space, electronic equipment and containers and packaging equipment. >> leslie, thank you ty, what steve did talk about? globally exposed chemicals >> chemicals and things like that i'm not sure that based on how well hedge funds do to take any solace that they have been selling tech kelly, see you tomorrow. everybody else, thank you for watching "power lunch. "closing bell" right now ♪ welcome to "closing bell." i'm wilfred frost at the new york stock exchange. the major averages may appear calm at the moment but it is a wild day of trading on wall street following wednesday's sell-off. >> welcome, everyone i'm sara eisen look at what's driving the action the focus on the bond market following yesterday's hawkish fed minutes. rates on the 10-year topping

1.75 today bitcoin below $43,000 in the session. energy and financials adding to the blowout start to the year. 59 minutes left to go in the session. coming up today, a can't miss interview with bridgewater founder ray dalio. that exclusive interview is coming shortly asking bank of america's head of commodities research where he thinks oil prices could be headed next. >> let's focus on the big stories this hour. mike santoli tracking another wild day joining us with his take adam parker mike, what are you focusing on right now? >> tentative steadying action is not movement under the surface there's a weak bounce in the growth sectors after being

oversold today the s&p 500 did go down and held the initial technical areas people were looking for. it comes up in there really what we have done is tried to stop the bleeding in this area. right around the november/december high just there's been a lot of money in motion and seems like today with a payrolls number first thing tomorrow morning sometimes the market idles in neutral before that. this is happening across the market real economy stocks are back in favor. here you have regional banks in financials they have converged. similar total movement here's the big reopening trade with regional banks. yielding going up. and then delta comes in and the asset managers take over

now we have a catchup by the regional banks very similar within sectors going on around -- among sectors, too look at the risk appetite frontier plays i like to call them tesla, nvidia, amd do you think maybe similar people buy these things? yesterday the biggest net buys from retail traders and see they have gone back to the exact level where they just went vertical and broke out this means an overshoot and now being corrected in this fashion. speaking of overshoot, look at forward valuations on a pe basis. this is the software market. pretty sharp reviersal there bak to 2021 in terms of first got to the levels of valuation.

that's the adobe, salesforces. companies like that. microsoft the bellwether of the group at a prem yum and getting back to the expensive levels and that's the nasdaq 100 and the s&p 500. moderated valuations but not getting back look at the bottom in late 2018 when there was a valuation opportunity, guys. >> mike, thank you well off the lows as we stand. fractionally lower on the dow. we have breaking news on the fed. hi, steve. >> hey, wilf st. louis fed preseident, providing new details on the views saying the -- supports balance sheet run-off together with raising interest rates. sara said it was the bond market it is for bullard, also. he said the fed could have an

influence through selling of the -- letting assets run off on the long end and raises the short end and could in his opinion avoid more disruptive rate hikes on the short end bringing the balance sheet of many years to pre-pandemic levels or lower and saying the fed could tighten as soon as march and fed credibility at risk with current policy. >> another sort of hawkish tone from fed speak thank you so much for that let's bring in adam parker adam, i guess a little bit more fuel on to that hawkish fire that probably is the key cause for markets pulling back this week. >> yeah. that's probably right. you saw that in november and then a reversal. i think people are overreokaying to what they perceive as

hawkish. i just don't see how they argue in this environment. i don't believe that people's perception to remain there for long. >> so in terms of the correction we started to see most pronounced in the unprofitable, small, mid cap tech stocks but infecting other areas, that sort of sector rotation, does that continue or already talking about buying opportunities in the areas that pulled back >> i spend time with investors this week and what sold off in q4 that's an opportunity what can i press the short and then rotating in this year the same thing i have to break those up last year bull oish on equities and energy it's not like it's different

than last year it's skewed to the positive and the stocks are cheap this is a pure reaction to interest rates and the 10-year backing up i continue to think banks will be challenged on growth. i like the big banks simply because they have other business lines. i can see selling some banks in the short term to fade this. >> but if you don't think that the fed is really going to go through with the number of interest rate hikes which is a reasonable assumption then wouldn't you be buying the high growth tech names that have been hardest hit? >> generally we had a slight underweight view on tech i think that the -- i partially agree.

their targets for acquisition. the pe part isn't as relevant. if you're a company that's got pricing power, positive free cash flow in tech it macks sense. the things that sold off are probably bio tech. mid cap bio tech down 45 so if you look at the forward sales growth it is probably the same and a harsh correction for innovation in that area. probably like bio tech more. and then the stocks that got pricing power. maybe salesforce.com down on the slack deal and other stuff. i use them as a -- i'm a customer and they can raise pricing on me. i think it's pricing power. >> what about those names that ark universe, the hope and

dreams sector? are those still ones to avoid or have pulled back a huge amount that you have been looking to buy? >> most probably shorts in my opinion. i think it really depends. if they don't have a tangible cash flow in a margin expansion story in 12 to 18 months i think they're still shorts i would rather own in aggregate. are any of them? some of them in the basket that's not where you want to be i think some work from home stocks that pulled back, docusign, zoom, peloton, i think you want to be cautious. they don't seem to have technology books that are strong so i wouldn't be attracted to that group that sold off either. >> adam parker, thank you for joining us with your picks. >> happy new year.

>> happy new year to you, my friend after the break, the egs collusive sit down with ray dalie. where you should be positioned and many you are watching "closing bell" on cnbc.

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stocks are more stable today s&p is higher. dow lower after that big sell-off yesterday that sent the nasdaq tumbling down 3% on fears of faster tightening from the fed. the money printing and debt binge that the central banks to prop up the economies is one of the three main themes that ray dalio takes on in the new book "principles for dealing with a changing world order." i asked how concerned investors should be today as the fed removes that stimulus. >> besides how the machine works, we've created a lot of must be and debt a lot of buying

power. you don't create more wealth with more money. where the checks and the money came in, and yet before at the beginning of the phase all that money is being spent on increasing the inflation and with it throughout history it causes good services and asset prices to rise we are in the third year in the cycle and naturally there will be a tightening of monetary policy the problem with that is there's a great deal of interest rate sensitivity. because it's so far and extreme just the pulling back of that is

a delicate thing we're in a situation that the raising of interest rates and the tightening of monoetary process begins the process that normally is not enough to send the cycle down it can send financial asset prices lower but i would expect if you understand the short term cycle this typically seven-year type of cycle, it is the beginning of the testing of the brakes. >> so not necessarily a recession but could see increased volatility you have said you don't want to be in cash and bonds but if the fed does embark on the tightening and slows the economy and the market it feels like a turbulent time for

equities. >> the important thing to realize i think is the federal reserve and central banks will have to keep a negative real interest rate. right now bond yields have a negative real interest rate of nearly 1.5, 2% depending on where. the cash rate is minus 4% so that all investors will be in a position where the value of their money in cash or in bonds will not keep up with inflation. i think investors need to think about returns differently. i think they look at the amount of the returns in nominal dollars. how many dollars do i have they don't look at the amount that they have in relation to real dollars in other words, adjusted for

infl inflation. while there can be somewhat of a tightening it can't be enough to raise those returns on cash and bonds to be good enough to compensate for inflation because if it is, if you had a large rise in interest rates that would first set the economy down so when we look at the circumstances today, coming into the 2022s election and then 2024 elections, ifthe federal reserve tightened the monetary policy enough to cause a downturn, if we are at each other's throats when everyone received as much money, just imagine the consequences that that would have so i don't believe even behind the curve i

don't believe they'll be able to catch up and make cash and bonds an attractive investment. >> sounds like you don't see many hikes this year do you think they can get three done as expected >> i think that is a reasonable thing but they're going to be guessing and because the duration of assets is long, in other words when interest rates come down sensitivity to markets is greater, even modest changes are going to have an effect. you will see a monetary tightening taking place also where the rate of fiscal spending and what will come down both will be very large. fiscal deficit will be very large and the monetary

stimulation by a level basis will be very large but coming down so they will have to be testing the braking and finding out exactly how much they can handle it is a risky situation. >> no doubt. you said to be diversified what do you do with tech stocks which seem in the direct cross fire here coming to fed tightening >> again, tech stocks have a long duration, meaning they're sensitive to interest rate changes because the earnings and the payoff of tech stocks is very much in the future so they're particularly sensitive to interest rate changes and also experienced in many cases a bubble type behavior so they're more sensitive than the meat and potato type of basic company

type stocks. so that type of behavior, this is not an environment that's particularly conducive to those type of investments. >> so you put out a warning moving on to the second big theme and the political and wealth gap after key elections coming up. in this country 2024 it's plausible we might not have a clear result or disputed result. how would that manifest do you think in the markets what should investors be doing with that type of situation? >> well, i think that investors look at their whole position, there are people that think about many things. you know where they live and so on. let me describe that environment. i think we are coming into an environment, we are in an environment in which there might

be irreconcilable differences and people adjust not just for taxes but places they feel might be more whhospitable sometimes it causes a hollowing out as people take -- richer people leave to go to places they feel more comfortable more conflict. so also this dynamic in which there's maybe a question of rule of law or the constitution resolving these types of things has implications in terms of the l locations or the ways that people diversify i think investors and in the broader sense people seeking well being have to be aware of

those things it could be state taxes, the financial conditions of the places that they're in i think they have to be aware of those and of that in the broader sense. so if -- it also moves in a direction that is questionable it opens the pandora's box to what it means when we don't have same rule of law or working in the same way that opens a lot of questions. we'll have to see how that transpires but there is that issue. that wealth gap will be between increasingly more and more extreme left and right and more and more and that will have implications for taxes locally and federal taxes and the like. >> a warning issued on january

6, one year from last year's insurrection in which he called a straw in the wind. we will have much more from that interview later in the hour and the thinking on china and the criteria he uses to make investment decisions tried to give you the bigger themes which is all this money printing and did debt binge and starting to change as he said and interesting he doesn't think we'll go in recession and that cash and bonds are not a safe place to be because he doesn't think the fed takes it too far to hurt the economy and an idea out there right now. the clash between the u.s. and china which we'll get to in the next hoir and a political gap he says we face and could have implications for investors thinking about the future. they're playing out right now. i'm going to share with you what he says to do in this sort of

changing world order if it means the u.s. loses the biggest gift which is the reserve currency. >> i look forward to that part i thought clearly he is not super bullish but he thinks there won't be that many rate hikes and the governments can't afford to do that. it is possible that he is wrong on that point if inflation is out of control or whatever the trigger might be and presumably he would be more bearish quite interesting i think. clearly everyone listens to his view on the market. >> there's a short and long term story there. the long term perspective he's putting out there and he likes gold which we know and he'll talk about later is one that bill gates and the endorsement of the book said is a scary

message. the really being shifting dynamics in the world order which according to dalio happened many times and something for investors to pay closer attention to and not necessarily pricing the risk as they should. >> we look forward to part two still to come on "closing bell." by the way, we have slipped a little bit with 34 minutes left of the session the s&p is just holding on the dow down about 120 points or so still off the session lows but not significant gains there. coming up, crypto's slide and the key levels to watch. what's behind the latest weakness in bitcoin. here's a check on the top searched tickers on cnbc 10-year already in the lead having taken the crown for 2021. might it take thecrown for

2022 if today's performance is anything tgoo by perhaps. your doctor gives you a prescription. “let's get you on some antibiotics right away.” we could bring it right to your door. with 1 to 2 day delivery from your local cvs. or same day if you need it sooner. but aren't you glad you can also just swing by to pick it up, and get your questions answered? because peace of mind is something you just can't get in a cardboard box. that's how healthier happens together with cvs.

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welcome back to "closing bell." bitcoin and other cryptocurrency sinking. dom chu's got more on the moves for us. >> wilfred, the two cryptocurrencies that are the most important are bitcoin and ether because they're the biggest two out there and with what's been a 37% draw down from record highs near 69,000 for bitcoin it gives notice here ko according to data bitcoin's market cap is roughly $822 odd billion. at the highs the market cap was roughly 1.27 trillion with a

"t." loss of $450 billion like losing an entire johnson & johnson for context. for ether a drop to $410 billion. $159 billion in a drop or nearly as much as the value of a union pa pacific. sara, it is a level to watch to see whether or not to hold the september lows key for crypto traders out there. >> all right thank you good to have you on "closing bell" for a change. cyber security stocks having a rough start to the year. there's a call from wells fargo. we'll talk to crowd strike ceo about the biggest cyber threats facing companies this year this is the epicenter.

another pop for yields 10-year touching 1.75% still higher across the board. 1.73%. that helps financials climb to the top of the market with energy up 2.25%. utilities the biggest laggard. we'll be right back. at fidelity, your dedicated advisor will help you create a comprehensive wealth plan for your full financial picture. with the right balance of risk and reward. so you can enjoy more of...this. this is the planning effect.

welcome back we have got 25 minutes left of trading. individual stock movers for you. bed bath & beyond shares

lackluster q3 results. causing the shares to slash the outlook for the full year. the stock sank on that news and since rebounded nicely up almost 10%. shares of constellation slumping the company sees net income fall and sales beat estimates constellation with a new deal with coca-cola to bring the new fresca mixed cocktails into the market this year it's a second drink for coke. >> not the very nice tasting in my view seltzers but more flavor and fat to it? >> flavored. >> what flavors? >> lemon lemon lime is the flavor of fresca.

the canned cocktail phrase. >> better than seltzer just there's a news update for us. >> hire's what's happening why the south getting hit with snow and mix. nashville three inches on the ground total may hit five inches and flight disruptions are up again with more than 1900 u.s. flights canceled today former "the new york times" columnist will not be allowed to run for governor of oregon failing to meet requirements federal special itselves are looking for what caused a philadelphia house fire that killed 12 people a child that escaped say a christmas tree caught fire. former fed vice chair clarida.

his transactions included the sale of stocks which he then bought back three days a little every. previously the fed said it was porl rebalancing but the stock sale makes it the explanation harder to justify. back to you. >> rahel, thank you so much. 22 minutes left of the session. negative for all of the major averages nothing too pronounced and not moving in the right direction. after the break scott wren will join us to talk about this wild start to the year for the markets. f you really want” by jimmy cliff]

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markets are lower. not sinking. sinking is not the right word but definitely moving lower approaching the close. comes after the nasdaq's massive decline yesterday. joining us is scott wren with wells fargo investment institute. good to see you. do you think we'll have more of the same in the coming months that we have seen to start the year or a short temporary blip that presents a buying opportunity? >> i think it makes some sense that we could have some more downside volatility. looking out three, four months from now we'll see the downside volatility as an opportunity we have a lot of clients, a lot of retail investors in general with us and the competitors that are sitting on a lot of cash they have been trickle it in a little bit but basically underinvested so we like

technology we think it's going to be a leader this year so we want to take advantage of the pullbacks and i'm not sure how much of an opportunity is 3% pum pullback is it's a better chance to buy stocks at a lower price. >> you like technologies you are not afraid of fed hikes? >> no. you know, sara, the market -- there's a relationship between how tech stocks are valued and where interest rates are and we have looks for the 10-year yield to go up to 2.25 by the end of the year that's still a low rate. do we think interest rates will -- i don't know if normalize is the right word but be more norm over the course of the year yes. if the pace we expect is pretty

slow and orderly i think tech stocks do fine if we have bouts where the yield jumps in day or two that puts a headwind for the technology sector but we think it's temporary. you need growth in the portfolio. we like communication services too for the same reason. you can count on earnings from these companies so that's what we've been attracted to as far as technology goes. >> we have seen energy up 9% this year. are the gains coming too soon to be buying them today >> we have liked financials and had financials on for a while. it's been a stop-go kind of thing and happy to see a big jump there we had been overweight energy for a while and probably got out

too early and the sectors that are sensitive to the economy will continue to do well energy is sensitive to the economy and then we've been watching the yield curve and expect the high every rates and the curve will steepen and benefit financials financials are a place where people underinvested so i think you are seeing some money jump into there since the fed is talking some higher rates. >> certainly been strong so far. 4% for the year. thank you for joining us. >> thank you. humana falls a live. we take you straight inside the market zone. 15 minutes left of trading cash payment. we thought we had planned carefully for our retirement. but we quickly realized we needed a way to supplement our income. if you have $100,000 or more of life

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welcome back we've got a big lineup in the second hour of "closing bell." we'll talk to the head of the commodities research of bank of america about energy and energy. the second part of an interview with ray dalio we'll talk cyber security with the crowdstrike ceo. we'll look ahead to tomorrow's jobs report and what it means for the market and the economy 11 minutes left of the session mike santoli here to break down the crucial moments of the t trading and day stephanie link with us, as well let's kick things off with the

broader market a volatile week and a negative session yesterday but going back negative again today not anywhere near as negative but lower all three major averages dow in particular down half of 1% a lackluster follow-up to yesterday. >> it's hesitant it's still looking like a rotation that action is still occurring with the real economically sensitive areas are doing better pressure on tech but trying to bounce meta and paypal are leading in terms of s&p impact but the average -- equal weighted s&p on the day. russell 2000 is up it's not as if this is everything held in check it is definitely still kind of a money moving from one pocket to another in the market. >> steph, in terms of beaten up

spots of the market, the chinese internet names are higher and some worst performers like peloton is up. crowdstrike. talking to the ceo in the next hour any opportunities in these names? >> it is very hard because right now it seems that everyone is buying all of the laggards from 2021 in addition to the interest rate sensitive names. the problem with the growth names is when the momentum is on their side they're growth to own and not pay attention to valuations and talk about total addressable markets until the cows come home but when things turn there's no valuation support. i would like to see the chinese internet names are beaten down i just feel like there are other

places to put your money into 2022 because you don't get visibility from any chinese company. i might as well buy companies here in the states to exposure to china boeing wynn this is a really interesting start to the year. higher rate just huge rotation the fed. all in the first four days and volatility higher and still see the decent economic momentum with housing and isms and auto production loosening production is 25% below pre-pandemic levels why can you imagine what kind of demand will be there of course we always talk about the consumer being strong and adp number really good on services and leisure jobs, as well we have omicron and will slow down but i think you will snap

back after that. you have inflation no surprise there and why the fed is doing what they're doing. i was surprisedby the reaction yesterday. the fed is hawkish and will do it it is a matter of being in the right sectors and at least for the first four days is cyclical and interest rate sensitive. you know that's where i have been in my portfolio >> maybe too hawkish and late. technology is worst performing this week. i talked to bridgewater's founder ray dalio and asked what the investors should do with the group. here's what he said. >> tech stocks have a very long duration, meaning they're sensitive to interest rate changes because the earnings and the payoff of tech stocks is

very much in the future so they're particularly sensitive and experienced a bubble type of behavior they're more sensitive than the meat and potato type of basic company type stocks so that behavior, this is not an environment that's particularly conducive to those types of investments. >> summarizing there what we have seen of carnage lately doesn't sound like he's excited about tech is there anywhere within software names, cloud names, chips, mega caps, anywhere that interests you in the tech group? >> yeah. look i am 28% weighted in technology. excuse me. 22% weighted in technology but my benchmark with technology and

comm services is 28% there's some opportunities in security and cloud for sure that i will take a look at but i sold fortnet before the holidays up 120% any bit of news not positive that stock would fall 10%. year to date it's down 14% in 4 days i do like the total addressable market stories very much i would look at salesforce you know i pitched palo alto before for the time being i own earners and valuation supporter stories why that's hpe, cisco, ibm, facebook 20 times trading at a discount to the growth and semiconductors and lam research and broadcomm.

i think there's plenty of places in tech but got to be careful and earnings are coming from. >> and you like ibm that outperformed this year want to hit the health insurers. humana is getting crushed. bertha coombs here to explain why. >> maintaining the owner guidance for 2022 but low every the growth forecast due to competition. company projects growth to be between 150 to 200,000 range that's about 30 to 50% below the previous outlook the kroechlt said they saw much more members switching and shopping new plans in florida where they also saw aggressive price jg the comments at the

goldman sachs conference this afternoon. humana today on pace for the worst day since february 2009 and weighing on rivals look at clover they're hit hard, as well. >> thank you we'll rush through the story just bank stocks having a strong start to 2022. a number of wall street firms with 2022 outlooks for the group today. goldman sachs with a downgrade to neutral at bank of america saying it sees limited surprises for the stock in 2022. they like citizens and downgraded zions to ungds perform. goldman sachs also came out with the top picks. jpmorgan and bank of america with the highest rate sensitivity and should benefit from fed tightening.

very quickly, steph, where are you positioned at the moment >> yeah. so you know i like the banks it is a big weighting. bank of america i think is best positioned for 202 with interest rates. wells fargo right behind it with the sensitivity. m&a is alive and well. goldman downgrade doesn't make any sense to me and like american express >> two minutes to go in the trading day. mike, what do you see? dow down we have moved south all hour. >> mixed under the surface you got fair margin of advantage on the advancing volume. i mentioned earlier the equal weighted indexes are beating so i see some hesitant action in the big caps definitely going to the

sidelines before the payrolls number with a wounded growth tape this is what's happening in the nasdaq 600 new lows today volatility index holding pretty much yesterday's garn gains. still on alert that payroll number tomorrow has something to do with why investors are weary of what might strike the tape here. >> we have lower across the board. gist slightly. s&p down 107 nasdaq down 15 and then the dow down about half of 1%. we do have therefore a mixture in the sector performance. health choir, materials and utilities at the bottom of the pile microsoft and apple down again today. ark etf down

following a big decline yesterday. now down 9% just this week yields of course moving higher the 30-year back flat today. at the close, slight declines to each of the three major averages led by the dow down 0.44%. ♪ only the small caps ended higher dow, s&p, nasdaq lower i'm sara eisen here with wilfred frost and mike santoli coming up this hour, billionaire investor ray dalio on the trades to make. stephanie link is still with us. mike santoli, as well. steph, you are bullish on the

economy and the slcyclicals. have you made adjustments given the tone from the federal reserve? >> well, no. not really i'm looking for opportunities in some beaten down tech names and did add to facebook/meta this week just given it's had a big pullback but it is the only faang i'm overweight and plenty of tech names to watch and see on weakness. i still think given the economy that it's doing very well. mine is omicron. first quarter numbers coming down 2% on gdp minus that after that i think you see a snapback in growth so the fed should be tightening. that's why i own -- 600 basis po points overweight financials

so for now i'm not changing. but let's watch the economic data really. we are data dependent again. >> in terms of the intraday action and seeing the big cap tech names decline for a second day in a row is that a concern for the market bulls that think they should perform well even if rates decline? >> we came into the year with pent up profit taking to be had. t maybe it looks too hot and why not wait for the new year to lighten up on it leslie was talking about the goldman sachs with a purge of hedge funds in the names and now underweight tech i don't think it was decisive to tell you which way the indexes are tilted but a rotation.

you have yields up across all ma whic -- maturities today more the market builds in the expectations maybe the less the fed will have to do so i always think the fed wants to preserve flexibility. we'll see what the jobs number has to say about that. >> the dow, s&p 500 and nasdaq on track for weekly losses let's bring in aly mccartney have you been telling clients to buy this dip >> yeah. yesterday was a great day for us actually when you think about it you have a marlgt that of the last two weeks up 5% for the s&p. you have a one-ish percent decline yesterday. the market is trying to figure out the new narrative and dominated by the fed and not covid anymore i don't think. omicron and the sensitivity to

subsequent waves has been less and less from an emotional reaction an economic perspective and the question is what is going to take us to the next level. we think that we are in an environment where, yes, we are going into an increasing interest rate environment. we all knew that was happening maybe the pace changed slightly but yesterday was an overreaction to that pace and what these dips allow us to do especially while institutions are keeping up technology and everything else with it is to take advantage of what may be finally the beginning of rotation to cyclical and value and cement some very specific u.s., europe, japan mid cap and cyclical names. >> give us some specifics then. >> look. so we talked a little.

there are certain parts of the theme that i think resonat and continue to see cyclical growth. again, we have all talked about this nothing new. financials, industrials, energy. some other spaces and poktds of technology, cyber security that is a big one. a huge theme for us. big data is another one. south of taking apasrt companies which are price deciders not takers which are beneficiaries of the massive amount of cash in terms of high earners with cash on the balance sheet and going to get into the market both by buying equities and by spending whereas people that have less money and existed in the last number of years on checks and

social programs in trouble and we want to focus on individual stock selection. we want to get out of largely the mega cap space and stay defensive. we had talk about bio tech health care. there are defensive themes in there. there are a number of themes supported by that. >> steph, i want to bring up unh with you a huge drag on the dow today had an awful day related to the humana warning are you in this stock? >> yeah. it is my largest health care and if it falls more i would add to it it was up 40% last year. it is not cheap but number one player in the industry and diversified especially with the

optimum business and this is the number one player in the industry with the best management team on a pullback own this there's a reason it trades at 25 times. because they have been able to deliver. humana is a pure play medicare advantage play and no way to hide for them and down 18% today let the dust settle. let's hear what they say next week. >> finally, aly, just on this idea that you said the market overreacted to the fed days like yesterday felt scary epa getting more accustomed to them and if the fed does start to change the policy it won't be the last time. are you saying it's an overreaction because the fed won't go through with three hikes or that stocks can rally in that environment?

>> yes and yes so the fed got slightly more hawkish and sent the market screaming down but when you really think about it in terms of what was priced in we know that we are going into an increasing interest rate environment and whatever language is used about inflation it's been pervasive and significant at 7%. none of this is particularly surprising potentially the pace is surprising but when you think back and look at history increasing interest rate cycles have been kind to equities, especially the kind of equities that we were just talking about, especially into the first interest rate hike and i think when you start to talk about what is going to happen to equities in this increasing interest rate environment you start to go back to the point i thought was really great that ray made which is that you can't go to bonds right now. where else are you going to go

we have taken earnings down so low that we expect to see a major bump there to cat liz everything the market reaction when you look at how orderly was with internals, defensives being -- sticking in there. cyclicals coming out very well i think that all of this sort of makes sen and the growth story and everything about the reemergence and the fed that's supportive, none particularly changed. >> aly, thank you for joining us >> my pleasure >> before we let you go, steph, zone in on a best trade idea right now. what is it >> match group it is a reopen name.

it is a laggard. it was flat last year. but yet you see record engage. only 25% of the singles in the world are using online dating. these guys are the number one in the business with a very strong portfolio 15 million active payers two of the key products hinge growing at 100%. more like 50%. 100% last year is a big number tindr has new products and monetization i think 2022 sets up well. easy comparisons dating growth at 17% and did m&a that's going to be synergistic i like this. got to be patient but i think for 2022 this is a good story. >> steph, thank you so much. thank you for joining us today. >> thank you. we are just getting started

here on the second hour of "closing bell. energy sector is red hot a top strategist on whether oil and energy stocks continue to rally. later ray dalio explains his latest thoughts on china we are back in two minutes ♪ ♪ wow, we're crunching tons of polygons here! what's going on? where's regina? hi, i'm ladonna. i invest in invesco qqq, a fund that gives me access to the nasdaq-100 innovations,

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welcome back excuse me. cyber security out performing tech today crowdstrike coming in asa big winner by 4% after being initiated at overweight by wells fargo. despite that, the group had a rough start to the year. all by more than 8%. we are not in fact going to discuss crowdstrike right now. apologies for that we were due to do that and have the crowdstrike ceo on that will be later in the show still coming later

someone will confirm that. don't miss the sinterview and th interview right now who is an expert from bank of america merrill lynch and joins us now hi sorry about that some issues happening there on the technical side but great to have you with us let's start if we may with gas prices why we're still seeing a big gap between u.s. gas price movement and europe and asia. there's always a difference but recent events and lng shipped from u.s. to europe. >> remember, the u.s. only has so much capacity to export gas internationally. about 11 billion kubik feet a day and that capacity is -- only

place forrist gas to go is u.s. or mexico. there is a bottleneck there. we can't keep pushing more gas and the europeans have low -- they have a major gas issue. now protests are breaking out beyond what we have seen already. the tensions between russia and the ukraine. clearly european gas traders are concerned of pipeline supplies of gas and the big spike of last week atraktded imports into the region but still not enough. europe is in a very difficult spot domestic supplies have gone down quite a bit and it's a combination of factors it came out of the winter with low inventories to begin with. underserviced in infrastructure. and become very reliant on russia and global liquid gas going to china for quite

sometime until the last couple weeks. >> what about the outlook for coal prices? >> right so coal should respond more. depends where you look u.s. coal, global coal on the coal side the key element that is changing the market around is the fact that china reopened its domestic coal industry after seeing prices spike dramatically later last year we saw a big spike in gas in the midst of the cop26 summit. the chinese government relaxed domestic coal production and helped bring prices down so we are not as bullish on coal we think this commodity is going to level off but on the global gas there is not enough gas and a different gap between coal and

gas. we see higher prices for longer. coal will start rolling back. >> francisco besides oil and gas, is the other commodity, broader commodity complex giving you a sign that inflation peaked how do you read the rollover in prices >> hey, sara, thank you for the question we have upside across the energy complex. we will see oil prices rise higher current prices for both brent and wti are $6 lower on average. prices could spike by the summer we still think oil will drive inflation higher for the commodity complex. higher interest rates do not

impaktd commodity prices in the first year so we are likely to see pressures across the board on commodities to the upside led by oil and a recovering trapg. we have the omicron spread in front of us and brentd trading at $82 a barrel. >> so what is your call then in terms of best exposures to have in the year ahead? will henry hub catch up more than oil from here >> we think that some of the better commodity trades to next year, we have different exposures. brent will do pretty well. i think heading boo the summer months there will be a chase up in both fuels. refineries struggle to make them both and eventually we'll see

the u.s. and the bigger story moving from energy independence to energy dominance and part is thinking of the world economy china has the might but not the resources, the energy. russia has the resources and not the might. europe seems to have neither anything energy intensive around the world will be made in the u.s. we have seen a big rotation away from chinese aluminum, steel production and exports of bitcoin moved out of china and coming to north america where you have abun dance of capital and energy we don't have enough people to fill up the jobs. >> yeah. energy is working up 9% so far

francisco good to have you as always. >> thank you. up next, ray dalio's latest thagts on china, bitcoin and more the countdown is on for the decemberjobs report. how the mb cldnuerou impact tomorrow's trading day later on "closing bell.

welcome back deal news from "the new york times. hi, julia. >> wilf, "the new york times" company made a deal to buy the athletic for $550 million. dealset to close in the first half of the year athletic has 1.2 million subscribers and tapped into demand of sports fans. the company has about 600 employees. two thirds are reporters covering nearly every professional sports teams in the u.s. and european soccer clubs this is a way to reach the target ahead of the 2025 goal to hit that goal. now to give a sense of valuation

bezos bought "the washington post" for $250 million so these valuations have been going up pivoting in the media and communications space t-mobile released fourth quarter numbers announcing 4.8 million net additions. expected to be the best in the industry but that stock is trading down almost 1% in after hours trading on that news guys >> yeah. they have set expectations high. thank you. conflict between the world's two biggest economies is only heating up the tension of taiwan a risk factor for investors. this is a study of the last 50 years including china as a global superpower. as far as u.s.-china tensions go

i asked him if investors understand the risks and ramifications of this brewing battle. >> there are five types of wars basically. there's a trade war. a technology war a geopolitical influence war a capital war. and could be a military war. all of those five have implications we are seeing all of those intensify. they have investment implications they have geopolitical implications and i don't think that they're well understood so i think they need to be better understood. that's why i wrote the book. >> what do you think investors should do about that for instance there are a lot of u.s. multi-national company that is do a lot of business in china. are they at risk or are you

talking about something broader around the markets >> right now, our economies are so interlinked, everybody is involved right? every time you buy nike sneakers or you buy an apple product, buy so much, more than a fifth of our imports of manufactured goods come from china. all of that, general motors sells more cars in china than the united states. there's an interconnectedness there that's i think unavoidable. the separation of those things would be catastrophic. so i don't believe that either

side wants to produce that kind of separation. i think that would be terrible for everybody. i don't think that that's going to be as much of an issue. there are geopolitical issues. you know such as the taiwan issue and so on but i don't think that these will be allowed to get out of control because the consequences wo would be so bad so i think it will be more like a competition and the most important thing is where will there be strength and capabilities in other words, each side in this competition, the main thing isbe strong, be capable. and you want to invest in the places that are strong and capable and i think you want to

be diversified to some extent, of course, in the united states. to some extent elsewhere, perhaps some in chin and places around the world i think the most important things are to longer term not be very much in cash or bonds as we have this tightening there will be some corrections but we are in a new paradigm and those will be bad assets and it is important to have a well diversified portfolio and that diversification includes not some sectors but countries. >> the other fact or of comp tigsz of the u.s. and china and you look at the world through this lens is competition for reserve currency status.

how we go into the new world order. do you see the competition between the u.s. and china and do you see china taking over that reserve currency status >> changes in reserve currency status on evolutionary if the world language is english most everyone will learn english and has supply-demand issues i think the united states is testing the limits because when th there's a production of a lot of debt, debt is a money, a promise to receive money, that is sold the world is overweighted, has a lot of u.s. dollar denominated

debt therefore promises to receive dollars. and it is going to receive a lot more with large deficits, bonds that have to be sold and as a result of that, the world is also underweighted in china assets it is diversifying more. china is the largest trading country in the world and also larger than the united states in terms of the important capital flows for lendsing and such. and so there is an evolution in favor of china having a larger share of the reserve currency status that is our greatest strength right now. the reserve currency status because it is that which allows us to print money, the world's

currency that is a great power and to have it accepted it is being taken for granted and it is being challenged should the united states lose that because of the supply-demand issue that i'm referring to that would be very bad. i think what you are seeing right now is that all currencies are going down in value relative to goods and services because i think we're in a situation where all countries are producing more debt and money and not so much relative to each other and having the affects on the markets and the economies that we are seeing. >> how do you diversify away if the currency are devaluing themselves how ultimately do you see it playing out? >> i think currency is a medium

of exchange and a store hold of wealth one has to realize that it is an ineffective store hold of weltd. in other words, when you hold an interest rate, an asset, that depreciates in relationship to the purchasing power so what that means is that the most moneys, it is not going to be an effective store hold of wealth and why one should look at other store holds of wealth, assets that don't depreciate in the paradigm that we are now in. this is a paradigm in which there will be more depreciation of the value of money. not every day. not every month. not every six months. >> sure. >> but over the period that -- over an extended period of time.

so we should look at other sourszs of store hold of wealth. >> is bitcoin in that category >> i think we are entering an era where the question will be what are the moneys? what are the store holds of wealth what are the items that you can globally take from -- move from one country to another to buy things some that the governments will not be able to influence such as gold and bitcoin and so on but there will be other currencies i think you will see china's currency become more internationalized in the range of choices will be increasing. we are entering a new era of what is the money that is the

store hold of wealth bitcoin has accomplished a lot over the last 11 years not been hacked and still operative and constant evolution. nfts and so many different things that are new. i don't think they're nearly as likely to be supported as other investments. those other investments might be gold, can be inflation index bonds not given enough attention by investors i would expect there will be an interesting redefinition of the popular moneys are and you are correct. no country wants to have an alternative currency because controlling a currency is one of the most valuable, important

powers for a government to have and certainly history has shown there's a risk of outlawing that compete with the regular currency it will be interesting times in the years ahead particularly as we get into 2023 and 2024 with the political situations and all that's going on, even globally with the competition of china. >> no question to wrap it up why the main 'm in from you and the studies and the takeaways are investors should be diversified but not in bonds and cash it sounds like gold is definitely on your list. stocks but not necessarily tech stocks give us a sense of what you think is safe in this increasingly scary environment. >> well, to think about, for example, also including

inflation index bonds as a possibility in the portfolio to be thinking about other countries. when thinking about other countries to think about them differently. like i have just a few basic criteria and looking at almost every country as well as companies are they earning more than they're spending do they have good finances, good income statement and balance sheet? do they have internal order? do they have civility? do their populations behave well with each ore so they have internal order and do they have a risk or not of external order. when i look at different places that is a checklist i keep in mind in this environment what

will be the safer assets. >> kind of a to-do list there for investors from ray dalio given the work done studying a few hundred years and the cycles and the current issues we face with massive debt that governments have taken on and the escalation and the political we wealth gaps. gold, inflation linked bonds and a worlds with challengers to the u.s. dollar, a big concept investors always refute it but in the big picture like that it's something to think about, something he says that the u.s. is taking advantage of and will be challenged. >> but his view there on the future of the dollar and the threat pose id to it by assets like crypto it is interesting with a clear vision on that we

haven't seen more regulation or janet yellen aren't as concerned as him if he is right - >> look at that china. >> there will be a big ger clam down as he sort of indicated. >> agree but i do think china is a example because china did basically eliminate bitcoin mining from the country and as he said every government wants to control their own currency. i think that's an interesting con conflict and clash if bitcoin is too big to do that and seeing a crackdown. doesn't seem like a systemic threat for the fed or the treasury at this point but you know they're watching it and keeping a close eye to make sure it doesn't become that. >> great interview

more online. cnbc.com to check out. we have a market flash on gamestop hi, julia. >> hi. gamestop shares higher on a report by dow jones with the nft and cryptocurrency plan. "the wall street journal report"ing that gamestop hired 20 people to build the unit. the report also saying that gamestop is close to signing partnerships with two crypto companies to share technology and co-invest in the business to work with a dozen or more crypto companies in the coming year and to invest tens of millions into this as you can see it is really playing into that meme trade and the stock is up nearly 16%.

>> thank you mike, it is so easy. 16% jump thank you. >> this is a $250 stock 6 weeks ago. 16%. about a billion and a half dollars on the market cap and the move seems like the intuitive direction to go. where is gaming going? what are meme stocks to capture? crypto energy out there. makes sen. you have open "c" that's the marketplace for nfts, a boom-bust stock. it doesn't really provide an answer to exactly how financially to have a way forward but they're fine in terms of capital they can expossibility in this area. >> gamestop up 16% 2021 marked the rise of retail traders whether theyonnuto ctie have a

whether theyonnuto ctie have a huge impact on the market. nurse mariyam sabo 24-hour hydration. no parabens, dyes, or fragrances. gold bond. champion your skin.

it is time now for a cs in news update with shepard smith welcome back, shep. >> thank you so much here's what's happening now.

the challenge to authoritarian rule is violent in kazakhstan. a police officer shot and one beheaded as demonstrators storm government buildings, began as pushback against rising fuel prices now the largest city, russian forces put down the uprising antonio brown is released why the wide receiver stripped of the uniform during a game on sunday and said he was in extreme pain but the organization claims he never told personnel he was hurt the incident sparking a debate about the mental health of athletes. city leader in philadelphia they're bringing in more resources, fire protection after a row house fire earlier yesterday killed 12 including 8

children. tonight, january 6, the investigation, the political divide and the inrecolsurrectios place in history back to you. >> thank you. we'll be joined by the ceo of crowdstrike, we hope. - [narrator] it's a mixed up world. and the way we work looks a little different. but whether you embrace the new normal or just want to get back to the routines that feel right, x-chair continues to be at the forefront of change,

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crowdstrike, higher by more

than 4% after initiated overweight by wells fargo why the group has had a rough start to the year. lower by 8%. let's bring in ceo george kurtz for an update. the stock is hit hard lately off the highs and the market is going through this valuation reset on the fed but has anything fundamentally changed in your business or the outlook for 2022 >> when we think about cyber security i don't think there's a more important category. you can't have digital transformation without a security transformation and the threat perspective gets worse. you will see markets do what they do but from the overall trend, massive opportunity and needed for every company in the world. >> i was interested in reading the notes that the team shared with us. we talk about the supply chain

disruptions and put down to tensions or to covid related issues but a lot of it is down to cyber attacks is that right? >> that's a major impact on organizations over the last year certainly. we saw supply chain attacks happen at the end of 2020. this past year coming into christmastime we saw a vulnerability that's massive in a logging system used by the websites that we frequent across the internet that caused a massive disruption to i.t. departments trying to get that patched you can see the impact with operations and then there's an immediate need to patch which there was in this vulnerability and certainly we did see that across the industry late last year. >> what about competition? there's a fear in the market that some of the newer names and

start-ups are going to be taking a piece of the market and specifically competing with you. is the pie growing large enough fast enough to accommodate a lot of winners how do you view that landscape >>

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december jobs report comes out tomorrow gamestop surging on the dow jones report saying it's entering the nft and cryptocurrency markets it's up 22% almost we'll be right back. retirement income is complicated. as your broker, i've solved it. that's great, carl. but we need something better. that's easily adjustable has no penalties or advisory fee. and we can monitor to see that we're on track. like schwab intelligent income. schwab! introducing schwab intelligent income. a simple, modern way to pay yourself from your portfolio. oh, that's cool... i mean, we don't have that. schwab. a modern approach to wealth management.

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welcome back we are counting down to the december jobs report consensus estimates suggest more than 400,000 jobs were added in the month of december. about double the number added in november the unemployment rate expected to come in at 4.1% compared to last month's 4.2% and all eyes on the number, of course, as always, sarah, and particularly what it does to yields. >> and also wages which is a key component of inflation remember in november they saw that big drop -- big jump, excuse me, 4.8% rise that feeds into the higher inflation numbers which is moving the fed we'll look for that number i think it's estimated around 4.2, 4.3%.

also, guys, an update on the gamestop story a source close to the situation has confirmed the dow jones report saying the company is getting into the nft and cryptocurrency market. the stock post market here up nearly 30% jim cramer's tweeting. he loves the idea. he's been advocating one thing to watch for tomorrow in the coming days whether the meme trades like this one can survive a tighter monetary policy path because up until today it's been kind of bumpy for them on all of this talk of fed hike >> doesn't look like we've got mike. >> no mike for mike. what were you going to say, wilfred? >> no. i was going to say it will be really fascinating to see. clearly more interesting when we get to the next fed meeting. this will massively influence what they are or aren't going to

say at it. we'll see over the next couple of months whether they'll get spooked by the stock market moves or continue to focus on the stock market economy. >> a lot of people think they are dictated in some parts by the s&p 500 and we see more tough days like this it could be harder for them to carry out their business, not to mention it's a mid-term election year it's going to hurt the economy. >> negative day for the s&p 500 but not too tough. just down 10 basis points. we're out of time on "closing bell." "fast money" starts right now. tonight on "fast" we are breaking down the banks. the financials on fire our traders are playing this trade. plus, sheep in wolves' clothing they're dressed like big, bad growth names and later the bitcoin breakdown. the cryptocurrency lower today it's now lost a quarter of its value in the past two months i'm melissa lee.