andest mates are very conservative. >> it's had a nice move over the last few months after some serious questions. >> absolutely. it's still down 48% from its high. >> china has been a problem. great stuff, everybody. i'll see you all on "closing bell." "the exchange" is right now. ♪ ♪ thank you very much, scott. welcome to "the exchange." i'm dominic chu in for kelly evans this afternoon. here's what is ahead on the show. great for companies and households, but not strong enough to ignite inflationary pressures. so are we setting up for a goldilocks growth period? our economist thinks so. she's here to make her case. plus, here we go again. the countdown to a partial government shutdown is on. the biggest holdup this time, it's just that. it's time says our next guest. there's just not enough of it to get a deal done. he walked us through it and what would shut down first.

we have the action, story, on three more names reporting results. we're looking for the trade and our technician sees an opportunity to buy two of them. that's ahead. but we begin with a check on the markets right now. the dow, the nasdaq, and the s&p 500, currently you can see down one quarter to one half of a percent. take a look at what's happening with health care, one of the lagging sectors today. that's due in part to the underperformance in names like eli lilly and novonortis. those diabetes drugs and weight loss drug makers are reacting to the surge in viking therapeutics. that company just announced some trial results showing some favorable outcomes for a treatment that they're developing for anti-obesity. so those shares up roughly 100%, near session highs. so that battle for what's going to happen with the future of

weight loss around america and the world is picking up. check out what's happening with bitcoin prices. we're at just around $56,745. at one point, we did top $57,000, the highest levels going. you can see that chart all the way back to november of 2021. a lot of it has to do with the -- at least optimism around bitcoin etfs and also this idea that we're coming up on an event that reduces the supply growth of bitcoin called the halving. check out the stocks around the bitcoin ecosystem. coinbase, marathon digital, at one point we're up to date. marathon digital giving back some of those. on the markets, that's where we start today. our next two guests have washington on the mind, and one says congress could push stocks to the downside. the other says the fed could lift markets higher. joining us is jeff killberg, and michael shoemaker, wells fargo

global head of macro strategy. thank you very much for being here. we'll start with the macro big picture, michael. can we talk about how things stand with regard to your forecast with regard to how things are shaping up in america? i feel as though the markets are telling us that things are not as terrible as they were feared to be just six to nine months ago. >> that's right, dom. inflation is down a ton. we can see that. i would say the path forward is a bit bumpy. we probably always knew that would be the case. you can't have inflation go from very low to 9% back to two to three very quickly without some turbulence. but the interesting t ing thingw much of the recutting has been taken out. so it's more of a slow progression. the underlying economy looks pretty good, but not hot enough to spook the fed. so a good comfort zone for a lot of people. >> it's to goldilocks i

mentioned in the open, the idea that things are not as bad but not as good, this middle ground scenario, but it took one hot inflation print to send the markets down, and just to have it go straight back up because of all things nvidia. what does that tell you? >> it reveals the percentage of those rate cuts. it's a matter oh of not if, but just when. but i think the market got ahead of itself, dom. we talked about those price cuts coming in, in march and june. and now march is off the table. i think we took some of that performance. that's why we vaulted above 5,000 in the s&p 500. but i think we're going to be okay. i'm cautiously optimistic. it's not the rate cut story, it's just a matter of when the market is going to embrace it. >> cautiously optimistic. michael, we used that term and that cliche so much in the markets as of late. there are folks who believe that the soft landing is not inevitable, but the highest likely outcome.

is there a soft landing that's going to happen? if so, when? we haven't seen any kind of a down turn whatsoever in the economy. if it happens, what triggers it? >> if there's a trigger, dom, it's probably on the employment side. labor markets are fickle, and can go from robust to weak to unpleasant within three to six months. it's probably that sort of thing. it seems hard to believe at this point inflation would rocket up. i doubt that's going to happen. when you think about the labor market, maybe it weakens a fair bit. that's probably the most likely cause. the big question is, what's the chance of really nasty landing? so maybe growth tips a little below zero. does it go negative? we think that chance is low at this point. >> i think we are in the process of this soft landing. it feels like the wheels are down. we have $7.7 trillion on the balance sheet, cushioning the

tarmac for the soft landing. that's my belief. >> with that in mind, michael, if you look at the rate picture right now, long-term yields have crept higher. i don't say surge, because yes, it does look market from the three and three quarters we saw at this cycle-ish low. but they didn't rocket back up to 5%. we are in this 4% to 4.5% for the ten-year note yield. you're a rates guy. what does that say about what we think the long-term growth prospects are and the inflation prospects in this country? >> rates are still really restrictive, dom. if you think about the ten-year and focus on the real yield, it's about 2%. if you look at fed funds, it's about 3%. those numbers are very high. so what that tells me is policymakers at the fed and true at central banks, as well, they want to keep policy tight a bit longer, so they're taking out a prescription against the patient, really going crazy and

have inflation go rocketing up. but they can't keep rates restricted too much longer. so it's a tough path to walk. it sets the stage for the fed to cut, perhaps a lot less than people anticipated, at least this year. but you can't keep real yields back high for that long, or there will be real trouble. >> it might be restrictive, and that's true in pretty much in every academic sense of that term, but the stock market doesn't view it that way. we're just about at record highs. we thought that nvidia would have to blow it out of the park by a threefold to keep the market going higher. nvidia was solid, no doubt, but the market continued higher. why? >> i think it's the cash on the sideline. we're seeing cash and cash equivalence up to about $7 trillion. we are seeing what michael is calling about, the smaller cap

stocks are shrugging off the fact of the when and if conversation. they're anticipating rates coming down. so a lot of these stocks are saying yeah, it's bothersome, but we know it's inevitable the rates are coming down. >> what seems to be the most attractive part of the market right now? >> i think the ai plays that are underappreciated like a tesla, and the small-cap stocks ignored for so long. that mean reversion to the s&p 500 will allow these small caps to move higher. >> thank you very much, jeff. michael, stick around, please. we have seven-year notes up for auction right now. rick santelli is tracking the action from the floor at the cme. rick, over to you. >> yes, dom. best of breed. we had $42 billion seven years. not a record like the last two auctions in terms of size is. maybe the smaller size was a big help, because the yield of those

42 billion seven years, 4.327%, pretty much spot-on, which means pricing didn't help or hurt, but didn't hurt is maybe the operative phrase. if you look at all the metrics, we have really solid bid to cover, the best since august of last year. 69.6 on indirect. those are foreign purchasers, the best since october of last year. we were definitely light. weakest since october of 2020 on direct bidders. you know the large institutions, pension funds, insurers? that's surprising, and dealers took a little more than the ten option average. so b and in boy. the previous two auctions were average auctions. we want to continue to monitor, and let's get it straight, folks. i'm not saying when we give good or bad grades for demand at auctions that it's going to poison the well for all the auctions and all the paper we need to issue to satisfy the

debt. i'm just tracking it one option at a time. and over time, you can see how investor demand seems to be softening ever so slightly month to month to month. back to you, dom. >> so many variables make up that demand picture. rick, thank you very much for that. we're going to dive deeper into that bond trade and what it's telling us about the economy and the timing of the hypothetical first interest rate cut we have seen. let's bring in stephanie roth. michael is still with us, as well. michael, over the last almost decade and a half, we talk to you about the bond market and rates action. what did that serven-year auctin tell you? >> it was decent. when you think about what the auction is telling us, to me, it's a natural lead-in to month end. if you think about all the investors out there that have to

rebalance portfolios, and there are quite a few, they say stocks have been well this month, bonds have done poorly, so i have to buy some bonds. this is the last auction of the month. i suspect you're going to see it's probably this the after market going to do okay. but it sets the stage for a decent rebalance over the next four or five trading sessions into bonds. so the near-term path is pretty good. >> we got an idea of what michael's view of the economy is. i would like to get your take on this idea that the u.s. is not destined for a hard landing, and that almost tends to become a base case scenario, that the u.s. will either soft land or maybe not land at all and keep coasting along with this economic growth picture that's modest, but might get stronger. >> yeah, we totally agree. we're expecting a soft landing, that's our base case. for us, a soft landing is 2% gdp and inflation heading back down to 2%. we don't necessarily need to get

gdp running well below trend to get there, and that's what we learned last year. growth can stay modest with inflation coming down, and dare i say, inflation appears to be somewhat transitory, even though we don't necessarily use that word anymore. >> it wasn't transitory for a good couple of years there, and it became very, very not good to use that term because of it. there's a reason why it's a triggering word for so many people. we did get a couple of hotter inflation reads than some expected. we got pce coming out later on, right? the fed's preferred inflation gauge. do we think inflation could not yet be a mission tlaccomplished scenario for the fed and policymakers? >> the fed is going to want to see more data and january was a setback. this is driven by largely

related to annual price increases that go into effect in january, which is catching up to the prior years' strong inflation data. so we think this is very much a january trends, and in february, march, things should look more normal. but the fed will be on hold until june. by that point, the year over year inflation rate is going to be below 2.5% and they'll feel more comfortable easing interest rates. >> how quickly the narrative has changed. a couple months ago, it was half a dozen rate cuts and it was going to start in march and everything else. it shifted quickly, within two to three weeks is when that all started to unravel. what do you think your base case scenario is? do you think it starts in the summer months and do we get three or four this year or more? at this point, it doesn't think like the market thinks we're going to get more at all. >> probably in the middle of the year.

for most of the fewers ersviewe not too hung up. kind of tough to defend doing your first cut a month and a half before voters go to the polls. but middle of the year, plus or minus. total for the year, probably 75 basis points. but the key point for people investing in bonds, we strongly believe once that first cut is in, the market is going to price a lot more additional rate cuts than it has baked in. so what that means is that when that first cut happens, things like the two-year treasury yield go down a bunch. the three-year a lot. so the market is behind with respect to the fed's eventual destination, but it will take longer to get there. >> michael, this is an excellent point. stephanie, this is, of course, an election year. there is a lot of crisscross between what people perceive to be political or nonpolitical actions that affect our economy.

do we feel as though no matter what happens in this election, what exactly could the prospects for the american economy be after november comes and goes? what does 2025 look like? i know it's a long way out. >> yeah. our base case is that gdp could trend around 2%, but the things to keep an eye on are what is going to shape up in terms of to 2025 tax deal, which will be relevant for 2026. if we have a trump presidency that would look more like a $3 trillion tax deal, which is not stimulus, that's just status quo. that would be financed by tariffs, which would be negative for the economy. and if it's a biden presidency, we would get a $2 trillion tax deal, which is tax increases on the above $400,000 earniers. so this is a question about 2026 growth, but that's what the market will focus on. >> stephanie roth and michael

shoemaker, thank you very much. we'll see you both soon. i want to bring your attention to oil prices. reuters is reporting that opec plus will consider extending those voluntary output cuts in the second quarter to prop up oil prices. the group first agreed to cuts of a little more than 2 million barrels per day in november. coming up on the show, we're only four days away from a potential government shutdown as joe biden meets with congressional leaders to strike a deal for federal funding. we've got the implications for investors and foreign policy, coming up. but first, sources tell cnbc.com that warner brothers discovery is no longer pursuing a merger with paramount. those stocks are down more than 20% to start the year. we'll look at the fallout for the media land scape coming up next. "the exchange" is back after this.

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low. and warner brothers discovery not much better there. here with more with that story is the man on the case who is our media reporter alex sherman. this was maybe met with skepticism early on anyways, but it seemed promising at one point. what gives, why happened, why did it fall apart? >> yeah, so there's strategic logic to putting media companies together in terms of you're able to take out a lot of costs from the business. this was the playbook that warner media and discovery ran, pushing those two companies together. you take a look at that deal, though, and the stock has fallen 45% plus in the past year. 60% to 70% if you push it back to when those two companies came together. so while there is and always has been a strategic logic to pushing two medias together from a cost eradication standpoint, if you look back at all of the

recent mega media deals, so vie viacom or at&t buying time warner, there has been a colossal loss of value in all of those deals. so you're looking at two companies, paramount and warner brothers, both trading near 52-week lows. so i think the sentiment here, the investor sentiment are pushing these two companies back together at this stage is probably fairly sour. there's been a lot of track record here, maybe you guys should worry about getting your own house in order first and then look, just because there's pencils down now doesn't mean a deal couldn't come back around. >> so let's talk about this sell to somebody else hypothetical scenario. this is not that -- just because warner brothers discovery is allegedly, source familiar, not part of this conversation anymore. it doesn't mean that paramount isn't still a possible deal

target. there's still another party involved in this process? >> correct. that's why this is relevant. the reason warner brothers discovery entertained doing a deal right now is paramount global has said we're -- if you want to make an offer, now is the time. and so we know that sky dance media, they are in the process of doing due diligence. i'm trying to figure out, is there a deal to be done here? where sky dance media, a smaller media and tv production company would merge with paramount pictures, a larger studio company, and then either that would be a full takeover with die vestitures, or maybe you could merge those two assets and maybe the rest of the company trades publicly. the structure is very much still a tbd, and part of the reason why diligence on this has taken a fairly long time, this has been going on for months already. so warner brothers discovery

being out of the picture, good news for sky dance media if they want to do a deal, because it's just one less player around the hoop on this. but maybe warner brothers discovery feels like look, if a deal doesn't get done there, part of what i are theed is comcast is not interested. perhaps the warner brothers folks say we don't think a deal is going to get done or we don't see a deal that makes sense between those two entities. so maybe it behooves us to wait and see if paramount's stock goes down further. this is what john malone, a board member at warner brothers, said on our air about six months ago, that he feels like it's possible paramount global may be on a train to becoming a distressed asset, if you push this forward a year or two. >> let's talk about some of the outcomes. we talked about this in the lens o mergers. i remember, and i think about the deal that amazon did for mgm. this is a vertical integration,

a much larger company that goes after a smaller one. is there any prospect that a paramount could become part of a larger media or tech conglomerate? and if so, who could those people be? >> it's doubtful, because the tech companies have basically said, privately, we're not interested in legacy media assets. we can do it ourselves, and why incumber us with this dying industry? we don't want to deal with that, that's not our business. so i think it's the hope of paramount and warner brothers that a tech company would buy them. but there are regulatory issues there, and i think the transaction gets a little messy, because they're not interested in these dying cable assets. so yeah, maybe they would be interested in the studio or others. maybe you take the streaming and you put it together with prime video or something like that. it's possible. but there's a lot of hurdles there, and i think at this

stage, from what i can see, it's more wishful thinking than anything else. >> alex sherman, great reporting. thank you very much for the look there. for the full story, just go to cnbc.com. alex's story is front and center right now. still on deck, alphabet's artificial intelligence woes are back in the spotlight. we'll tell you who is in hot water and what's worrying wall street the most. hi, i'm sally. i'm from phoenix, arizona. i'm a flight nurse on a helicopter that specializes in trauma. i've been doing flight nursing for 24 years. as you get older, your brain slows down and i had a fear that i wouldn't be able to keep up. i heard about prevagen from a friend. i read the clinical study on it and it had good reviews. i've been taking prevagen now for five years and it's really helped me stay sharp and present. it's really worked for me. prevagen. at stores everywhere without a prescription.

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welcome back to "the exchange," everybody. as the dow takes a breather, i'm tyler mathisen with your cnbc news update. change, health cares, i.t. systems still down since a cyber attack was discovered last week. the united health care subsid sar says 90% of companies have found a work around but no word on when it will be fixed.

the u.s. army will reduce forces by around 5% to restructure itself to fight the next major efficiently as it struggles with recruitment. and shohei ohtani will make his spring training debut against the white sox. he will be the designated hitter since signing a ten-year, $700 million deal with the dodgers. much of this is back loaded. but no pitching yet. he suspeisn't expected to take mound this season. back to you, dom. >> tyler mathisen, thank you very much for the jus update. coming up, joe biden meeting with congressional leaders to avert a government shutdown. we have the details. what a deal could look like, and what it means for wall street coming up next. "the exchange" is back after this.

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welcome back to "the exchange." stop me if you've heard this one before. we're once again just a few days away from a partial government shutdown. joe biden met with congressional leadership earlier today to help hasten a deal. emily wilkins joins me now with those details and that meeting. emily? >> reporter: yeah, we're now four days out from a partial government shutdown, and joe biden met with top congressional leaders to urge them to prevent that shutdown from happening. speaker mike johnson told reporters as he left the meeting that he would be doing everything he could tokeep the government funded past this friday's deadline. >> we have been worki i ing in faith around the clock for months and weeks, quite

literally around the clock to get that done. we believe that we can get to an agreement on these issues and prevent a government shutdown. >> reporter: it feels like a familiar story here, but lawmakers are closer than ever before agreeing on the that first tranche of spending bills. this includes the department of agriculture, the fda, energy department, water related programs, and the departments of transportation and veterans. of course, among several others. lawmakers are negotiating a handful of provisions including conservative priorities, but democrats are also asking for increased funding for key nutrition programs for women and infant children. all of congress is waiting on the text of these bills to be released. that could happen later today. no guarantees, of course. at that point, the race to pass these bills begins. but the deadline is on friday, the very end of the day, midnight on saturday.

dom? >> i started off by say stop me if you heard this before. but could we find or see the possibility of a stop gap measure, a temporary fix put into place until they agree to a larger, more comprehensive deal? >> reporter: that's something we're hearing lawmakers talk about. you even heard senator chuck schumer and hakim jefferies when they left the white house mention this might be something we have to deal with. it's not the result that anyone wants to see. they want to get those bills done and the detailed spending for the rest of the fiscal year. but the absolute worst case scenario is a government shutdown. so they prefer having that stop gap than to having the gove government shut down. >> emily watkins with the latest there. thank you very much. with the house now not back in session until tomorrow, our next guest says there's simply not enough time to get four appropriations bills through congress by friday and a real

chance of a partial shutdown. joining me now for more is ed mills, washington policy analyst at raymond james. we all need more time. what exactly is going to get done in your mind, given the fact that there is no more time to hash things out? >> so dom, you're in a situation where if you have a clean bill, it has time. but if there is anything that is at all controversial, there is not enough time before friday at midnight to get that through the house, because they're not back until tomorrow. and starting the clock in the senate. the senate has all these weird arcain rules that you go 30 hours and you're able to unlock the next step and then another 30 hours. there's not that time there. you asked about a continuing resolution. that's certainly possible. there's a couple of problems there, though. one, house republicans have said they will not do that again. and two, democrats will be

needed to come along. what is their cost of coming along this time? is it ukraine aid or something else? >> okay, ed. there are some members of congress who are, in essence, telling the american public that they need to kind of get used to this idea that there could be a government shutdown. what exactly does a government shutdown look like come this weekend if a deal does not get done? >> so dom, the united states congress has 12 different individual bills that they fund the government. on friday at midnight, four of those bills expire. included in those bills are the department of veterans affairs, the energy department, the fda, transportation, housing and urban development. if you're watching the show and you have a flight on saturday morning, you do not need to worry whether or not those tsa agents are going to be able to show up. they will. they might not just get paid until the government reopens.

if you have a v.a. appointment over the weekend, that's not going to get canceled but certain new things will get cancelled the longer this goes on. >> a deal not getting done is not beneficial for the optics around either party or congress or the executive branch. this is an election year. what exactly are the tactics being contemplated now by both sides as to why you would even want to push this to the brink again? >> so dom, it's just a situation where the house republicans have a very narrow majority, and there's a small group who say if the speaker cuts a deal they don't like, they are going to have a motion to vacate them, and he's going to be former speaker johnson. that's what this comes down to. now, you say that there's a lot to lose across the board. however, politically, when we look at almost every other government shutdown, republicans are the ones that seem to get the blame here. so if speaker johnson is trying

to walk this tight rope here and telling his caucus, he's going to fight but he's not in a very strong negotiating position, because the dollars that are going to be spent were agreed on a year ago, bipartisan support. the final numbers what we're talking about this week were agreed on months ago. so it's just a question of, when will we actually get this deal done? because even if we're in a government shutdown, the only thing you do is reopen it at the numbers that are agreed to. >> let's not talk about this in terms of biden and trump. let's talk about this in terms of house leadership right now, and that is speaker mike johnson. is this dramatic or not dramatic to say that this is almost like a mini referendum on the speakership under mike johnson's tutelage? >> yeah. so dom, what i look at is, the speaker pro-tem patrick mchenry, who took over after republicans ousted speaker mccarthy, what he

said is, in many ways he's damned if he does, damned if he doesn't. that almost any deal is going to upset some portion of the republican caucus in the house of representatives. so his advice to speaker johnson, which i agree with, find a deal that you can cut, bring it, and if you can get policy, great. but if you're just trying to prevent yourself from getting ousted, we know from sports that the only thing that a prevent defense does is prevent you from winning. so i just think that we can look at these politics, but he doesn't have a lot of room to maneuver, to just cut the deal, keep the government open and figure out what policy you can get in that final deal. >> ed mills, saying prevent defenses are like death by a thousand cuts. thank you very much. coming up on the show, shares of alphabet are up 300%. and while investors may be

cheering, they have yet to launch a blockbuster product under the ceo's launch. that's next. as we head to break, here's a look at some of the names hitting all-time highs today, including autozone, o'reilly automotive, ulta beauty and others. "the exchange" is back after this. power outages can be unpredictable, inconvenient, and disruptive to your life, posing a real threat to your family's comfort and safety. when the power goes out, you have no lights, no refrigeration, no heating or air conditioning. the winds are not letting up at all here. we're going to see some power outages. number one thing to prepare for is extended power outages. are you prepared? you can be with a generac home standby generator. when a power outage occurs, your generac home standby generator automatically powers up, using your home's existing natural gas or propane, so your life goes on without disruption.

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slipping out of balance into freefall. i'm glad i found stability amidst it all. gold. standing the test of time. renewed concern today around alphabet's ai model as controversies mount at the chat bot's inracaccurate responses. some are calling for a change in leadership. why is this conversation coming up, deidre? >> reporter: you mentioned how

the stock has performed under the ceo for almost a decade. nothing to scoff at, but also this conversation isn't exactly new, right? there's always been chatter around google that it's not nimble, it's not quick enough. you have nicknames like grandpa google, this idea that where senior engineers go to do that, they stop to innovate and are slow to ship products. but in this case, it's all the more important. generative ai is supposed to be the biggest platform shift since the internet. so there's this idea google can't afford to have botched rollouts like it had with the gemini. this matters more than ever. so the ceo is taking a lot of the heat. not from major investors but more on social media. so it will be interesting to see if other investors like a tci for example, that was the activist that wrote a letter in 2022, telling google to get fit. or other large investors to see if they're demanding for changes

in management. there is another person to keep an eye on, it's google's chief of search, he's been at the forefront of ai announcements, demos, and the recent apology over the gemini image generator. so he's someone to watch, as well. the fact that he's out front, the head of search is the one that is announcing these new generative ai products may tell us something important, that google isn't ready to let go of search. that big question still looms over the company, what happens to its cash cow, search advertising? >> for sure. that's a huge part of the core business there, and obviously an engine for what drives maybe a lot of the other investment there. i wonder in your reporting, in your circles around the bay area and silicon valley, is there a sense as to what alphabet and google need to do to put themselves as a favorable

investor story up against the likes of companies like an amazon or a meta platform or other mega cap tech companies that have such ai ambitions, as well? >> yeah, i think the main thing is it has to be more nimble and move faster. when you think about what has happened with the gemini, it was barred and another project, google has had to rebrand products, relaunch them, take them away. they need to be more decisive and quicker, as well. chatgbt stole that main stream ai moment. it took google to get gemini out and it was still riddled with all these issues. not to say chatgbt didn't have issues as well when it launched. but there are also this idea when you look back at the ceo's management reign over google,

there hasn't been this big product development. the number three position, and until recently, it wasn't even profitable. so people here in the valley want to see more innovation. what wall street wants is better communication. but google has never been great at that in the first place. one analyst today called it the hermit kingdom. they don't particularly communicate well as compared to mark zuckerberg. he started to gear the message towards wall street, and we have seen what happened with that stock. >> and there are those that argue that everyone is still on that side outside of nvidia chasing microsoft and sam altman at openai. deidre bosa, thank you very much. see you later on. coming up, panels, pet insurance and payment. we have the action, the story and paid on these three ahead of earnings. that exchange is coming up after this.

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♪ welcome to "the exchange." earnings season is wiernding down but a few key names left to report. first solar, square space on deck. joining me here on set for the trades is oppenheimer's erie wald. let's start with solar. solar space is getting a lot of generation. 13 bucks a share from 20 citing uncertainty about demand after its report. demand will be a key factor watching first solar's report. the firm keeping an eye on falling prices and oversupply. what's the trade here? >> well, that's such a great point right off the bat. the weakness across the board, sun run, end phase, first solar. first solar worked during the initial stages of the bull narcotic 2022. now that's rolled other as well. you have the top down pressure. stock that initially broke down

last september. and here are the rules. prior to that, it was trading above a rising 200 day average. when that's the case, you want to buy pullbacks. now trading below a falling day rules you want to sell strength. i don't know how it's going to respond directly after reporting earnings. but if you get a pop in the stock, sell it into that 200-day average. one of the few stocks in a down trend as it stands. >> the charts are right there behind you right now. you can see that for first solar and the down trend long for the long-term 200-day. next up lemonade. up 37% other the past year. your colleagues at ap oppenheimer, ari, are staying positive. you're watching lemonade's technicals and see an opportunity from the fundamental and technical side as well. >> that's right. confirming disciplines here at

oppenheimer. one where you see the chart starting to reverse higher. it's part of this expansion and small caps that we're starting to see or at least the bull market is starting to broaden out a bit. a stock that is reversing the prior down trend. you see it in the slope of 200-day average which has really just started to take a positive tilt year to date. it's been up the last couple days. i think up 7% today. may be tough to chase it into earnings. one f you get a pullback into around 28, $19 or so, i think you buy it. i think there's runway into the last peak in july at $25, which is $4 of upside from here. >> all right. we're showing that chart right now with that longer term 200-day as well. finally, square space. those shares are higher today and up a little more than 3% so far this year. a neutral rating on the stock seeing several potential growth drivers going forward, including the launch of square space payments. but it's worried about the near-term upside as price increase tail winds abate.

ari, you're a buyer, though, of square space with these charts. >> this is a great-looking chart, dom. i mean, i think the set up here is here is a small cap growth name. i think at this point in the cycle, small cap growth just carries a great balance between secular growth leadership and the reation potential we see developing in smaller capitalized stocks. square space run right into resistance at $34. it hasn't been able to push through just yet. but i think with a bullish trend behind it, with this top down strength from a strong tech sector, i thu you get that break out to the upside. measure north $40 on that break out. pretty attractive target we see it. >> interesting move higher. speaking of payments, by the way, and platforms, reports are circulating that klarna is sounding out banks as a u.s. ipo for right now is possibly valued

at a $20 billion value yiegs. the klarna ceo will join closing bell ceo later on this afternoon 4:00 p.m. eastern time. k welc i also -- we have a little bit of time left. i want to call your attention to what's happening with the broader markets right now. if we are at an inflection point, or whether or not this is enough of a break out that we could continue to see bullish sentiment, specifically for the s&p 500. >> we think so. the market has run up undeniably so. sentiment indicators are more optimistic, but they've reached these levels in a very consistent and bullish manner. weekly rsi on the s&p 500, common offering above 75, only 4% of market peaks have occurred within rsi reading above 75. arguing against a top. the lingering concern has been small caps. they haven't made -- >> they haven't participated, right.

>> but that divergence now offers breakout potential. you're starting to see that in recent days. that could finally set up, dom, the bull cycle's long awaited broad base break away. we still haven't had that yet in a year and a half where you get stocks above their 200-day average closer to 80%. we have been calling for s&p 5400 since the start of the year and still then we'll get there. >> ari wald from oppenheimer, thank you very much. we appreciate it, sir. >> thank you, dom. that does it for "the exchange." coming up on "power lunch," shares of viking therapeutics are soaring today, doubling in value after experimental weight loss drug showed promise. they'll dig on to that story on the other side of this quick break. we'll see you tomorrow here on "t ehae.hexcng" do you have a life insurance policy you no longer need? now you can sell your policy - even a term policy - for an immediate cash payment. call coventry direct to learn more. we thought we had planned carefully for our retirement. but we quickly

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♪ welcome to "power lunch," everybody. alongside courtney reagan, i'm tyler mathis. glad you could join us. coming up a battle exxon and chevron over an oil project off the coast of south america. one complicating factor, venezuela's government. we'll explain that. plus, religion, politics, even sex. all topics many people would rather talk about than talk about money. why is it so hard to discuss personal finances? we'll dig into that. but first, let's get you a check on the markets. here just about 2:00 on the east