>> even as you're talking, the biden administration saying they're going to do everything they can on gasoline prices. >> we haven't even talked about nickel and base metals a lot of dynamics at play, but wheat prices caught my attention. six straight days of limit up. >> big problem for emerging markets. and thanks for watching "power lunch," everybody. >> "closing bell" starts right now. >> thank you, jon and kelly. welcome, everyone, to "closing bell." i'm sara eisen a sell-off on wall street to start the week as the war in ukraine starts to inject uncertainty in the market. nasdaq seeing the sharpest declines, down almost 3% as we head into the close. >> i'm mike santoli. let's look at what's driving the action futures tanked overnight as oil prices surged to their highest level since 2008 crude has since pared its gains. the u.s. is considering a stand-alone ban on russian oil more on that in just a moment.

financials are getting hit hard again today. even as the yields move a bit higher consumer names like mcdonald's and nike also sharply lower. and bed, bath, & beyond is the standout winner jumping after gamestop chairman ryan cohen revealed a big stake in the retailer 59 minutes to go >> we have a great lineup of market experts to help you, including rusheer sharma, oil expert tom cloja, alicia levine, and tony dawaier. take a look at kohl's shares falling hard as the company hosts the activist day we'll talk to the ceo in a first on cnbc interview. >> first, let's get straight to the market sell-off and the latest on ukraine. mike tracking the market action as always, ylan maui in washington with the latest on the push to ban russian oil, and joining us, rena sen

mike, start us off with what you're watching in the final hour >> really kind of a slow bleed lower. we're spending a lot of time on the s&p 500 right in the vicinity of those lows these are the lows that were hit in late january. again, in the fourth week of february and now again today. in fact, 4220-ish is where the intraday low was in late january, where the closing low was last month so clearly, there's some gravitational pull right here, and essentially testing these levels we did trait intraday lower than this back in february in the 4100 area. i think that's kind of the lower end of what you would consider this support range, and that's also the 15% down level of the s&p. every direction you look, flattening yield curve, no good. crude making new highs, also no good measures of financial stress, also building up at the bank stocks being lower however, again, not a real rush for the exits, just kind of a slow march take a look at commodities i like to look at the long term

view in nominal terms. this is exchange traded instrument that tracks broad commodity index. this is just too far too fast in terms of the velocity of price increases. this is dominated by oil, but it's all commodities what you see is it doesn't really compare to the prior spike in 2007, 2008 that really was the final push into recession and global financial crisis and it just shows you we're dealing with a fast adjustment, but an absolute terms, not yet crazy. how about positioning and sentiment? it's definitely become much more muted in terms of hedge fund positioning, in terms of hedging activity, but again, above the washout levels we have seen in deeper corrections there's nothing out of whack here with this gauge from goldman sachs being at this level with a 10% to 15% decline, but all of these had bigger declines and much more decisive bottoming washout action >> energy stocks at the center of the action. the sector is up more than 35% year to date

is it too late if you don't have exposure because this was such an underweighted sector even last year when it ran up, coming into this year as well, i wonder how much catch-up there is going to be from fund managers who have to build up their exposure, especially with tech underperformer. >> in the very short term, anybody's guess. very stretched, it's a huge gain year to date, but it's gone from about 3% of the s&p to 4% of the s&p. it's clearly not to the point where it seems as if in aggregate, investors have much of a bet on energy right now you know, i'm watching how it's trading relative to crude oil. and it's sort of been a little bit slippery you know, the overall energy etf today was not really doing much with crude making new highs. if you look at the xop, there energy exploration and production companies, again, maybe getting a little tired, but that doesn't talk about the long term. if you believe this is going to be a new threshold, there's time >> i think the question is whether it's a secular shift in the market, which we'll talk

about in a moment. let's get to ylan in washington for the latest on the push from congress and the administration, ylan, to ban russian oil in america. what can you tell us >> yeah, sara. we're seeing a rare moment of unity on capitol hill, as democrats and republicans in both chambers of congress announce an agreement to ban imports of russian energy and end normal trade relations here's how it would work, according to a source. what they're telling me is that congress would authorize this ban on oil and gas until further notice once the crisis is over, the president would have to take action to lift it. normal trade relations with russia and with belarus would be cut off. that would automatically increase tariffs on other russian imports. the biden administration would also have the ability to impose even higher rates. this bill would also urge the white house to call for russia to be kicked out of the world trade organization in a joint statement, the leaders of the house and senate

committees that oversee trade said they hope these actions send a clear message to putin that his war is unacceptable i'm told this bill could go to the floor of the house as soon as tomorrow. we'll see how quickly it might move through the senate because remember, sara, congress is also trying to pass $10 billion in aid for ukraine, and keep our own government from shutting down at the end of this week back over to you >> we have since heard germany is against an oil embargo. they're just so dependent on russian oil. so was this something the u.s. could move ahead with, without some of our european partners? >> yeah, this is the interesting thing because both congress and the president have authority in this area, and it seems that congress is already starting the process of moving on its own without the white house sign of approval just as of yet. of course, the president would have to sign this bill into law if it were indeed to pass both chambers so certainly, it seems this could scratch the white house's itch for further action, but the

president could also decide to move on his own as well. >> ylan mui, thank you the dow is down about 700 points we'll stick with oil at the center cride spiking to a threne-year high before pulling back, helping set a downbeat tone for the market earlier today joining us is amrita sen, cofounder and director of research just in terms of the price action, how much is priced in right now in terms of taking russian barrels offline if the u.s. and european countries move to restrict russian oil? >> i don't think all of it is priced in, for sure you have seen huge paralysis in the market we calculated about 70% of russian seaborn oil wasn't finding buyers of course, some of that is priced in at about $130, but the reality is that if, and i still think the white house isn't particularly keen to raise gasoline prices at the pump, necessarily, but if the u.s. and say down the line europe were to

ban oil imports from russia, then the price has to be significantly higher well above $150, because we just don't have the buffer anywhere else to make up for it so in that sense, not all of it is priced in at all. >> what is happening now in terms of the scramble for physical supply? you did mention that tremendous percentage of russian production, those barrels available are not really finding buyers right now i just wonder how much incrementally it would actually matter considering that the world is kind of shunning these barrels already? >> absolutely. i think that is the point, that it's not a lot of russian oil is getting around thanks to the banking sanctions or just self-sanctioning in europe and reputational risk, very few buyers are buying russian oil. what we have seen and this is one of the reasons why the white house might be a bit more cautious, all that's going to happen is discounted, very discounted russian oil will flow east to china. we have seen china buy russian

oil today. india is open to buying it it's just that europe and the u.s. consumers will hurt through much, much higher prices so that's where it's a big shift in trade flows, but that's where the big physical problems are. shipping is an absolute mess right now as well. so nobody wants to touch particularly in europe these vessels. >> what about iran what's priced in at this moment in terms of an agreement there and bringing iranian barrels back on the market at this precarious time? >> well, that's the one bearish news out there and i would say from the world economy's point of view, we need iranian barrels. we have been saying that for months, even before russia, given how tight the balances were looking we will absolutely need these iranian barrels this summer. of course, there's been a twist over the weekend russia is tying certain demands based on the sanctions it's facing because of ukraine and saying, well, the u.s. needs to

guarantee it can lift off the iranian sanctions, so it is basically tying the fortune of the iranian deal with the current crisis that makes the timeline for predicting iranian oil coming in harder >> thanks for joining us to comment on oil we appreciate it with a 2% decline in the dow, energy and utilities the only sectors higher kohl's shares getting hit hard today, down double digits following the company's investor day. we'll talk to the ceo michelle gass about her transformation plan she called a, quote, complete reinvention of our business model a ondur brand you're watching "closing bell" on cnbc.

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stocks continue to get hit hard today with the nasdaq seeing the biggest declines that index down 3.2% right now full percentage point almost, more than the dow. take a look at the nasdaq 100 heat map where you're going to see a whole lot of red just a handful of stocks to the upside, and pulling up the -- the bottom there, 3.3% now for the nasdaq 100, downside leadership >> amazon, microsoft, apple, nvidia, facebook, all the growth names getting sold hard today. shares of kohl's also sinking following its investor day where they issued new long term targets like growing sales by low single digits annually, expanding the sephora business andopingening 100 smaller format shops over the next four years joining us is ceo michelle gass.

welcome. >> great to be here. >> stock is down 13% how do you view the reaction a lot of people see it as a judgment on the forecast and the strategy you laid out. >> yeah, clearly, there is a lot happening in the world and in the market today as it relates to kohl's, we're running this business for the long term, and we have great conviction on the long term growth of this business, and we're excited to lay out that strategy with our investors today. >> i wanted to dig into some of the financials that you laid out. i mentioned the sales growth, the operating margins, you're targeting between 7% to 8% some people would look at that and think it's a resumption of where you have been in the not too distance past. it's really just getting back to growth levels from 2019 and trying to build on that, that it could have been more ambitious how do you respond to that >> sara, so what i would say first of all is we think running our business at 7% to 8% with

low single-digit sales growth and returning to shareholders is a great formula for kohl's 7% to 8% is actually a healthy margin structure for our business it is higher than 2019 you saw the results that we posted this last year, where we really reset this business fundamentally restructured the business for profitability, both in terms of gross margin, how we're running our expenses clearly, we won't cap ourselves at 7% to 8%, but we believe that's a thoughtful guide to put out as we deliver growth and reinvest back in the business as well as return back to shareholders >> michelle, you mentioned a lot going on in the world and the markets. there sure is in retail in particular your competitor shares down pretty significantly today, too, and it seems the market is showing some significant concern about consumers and their ability to absorb higher energy costs and maybe the effect on psychology of the ukraine conflict what are you seeing, if anything, in real time in terms

of customer activity and resilience or a little bit of a pullback >> first, what i would say is clearly there's a lot of uncertainty with the consumer right now. so we have to stay really close and present to that. i think what we have been able to demonstrate over the last couple years is that we can be agile, resilient we just posted record earnings per share for the year 733, eclipsing our high in 2018. i think more importantly is we are going to be responsive to the customer i think of that from a top line and bottom line as it relates to the bottom line, we did guide right in that 7% to 8% over the long term and for the year ahead as well. we had a lot of strategies under way as we restructure the business, and as it relates to pressure on the consumer, value is a core tenant of the company. and we have a lot of flexibility in how we price our goods, we have aspirational brands like the levi's and nikes we have private brands that are very accessible opening price

point and a great loyalty program. we just announced today 7.5% on the rewards with our kohl's card carriers so we're going to be there for the consumer to make sure that we take their lead >> i did want to just play a sound bite because earlier, you have a lot of activists have been all over you in the past year or so and currently, jonathan dusken was on halftime report, obviously not that impressed with what you laid out and with earnings want to play a quick clip of how he characterized the relationship >> i think michelle very much knows how we feel, that more needs to be done i think they're missing some of the basics with inventory turn, the merchandise architecture, merchandise assortment, the value proposition that i don't think they're addressing again, think about this. we added calvin, tommy, eddie bauer, nike, adidas, under armour, exited brands that weren't performing, we still can't grow the top line.

it's very troubling, and you know, a sale is not the only path forward we mentioned this a couple other times, a couple letters. material change on the board, change of control on the board, and getting the right people in there with the right expertise to oversee the transformation. >> just wanted to give you a chance to respond. >> yeah, well, first, what i would say, sara, is as i was saying, we have restructured this business for profitability. we posted record earnings results. we returned $1.5 billion to our shareholders last year, and we announced last week a lot more return to shareholders doubling of the dividend, a $3 billion share op, another this year those are all signs we're running a very healthy business. and then secondly, we're positioning this business for growth we have things in our playbook today that we have never had as we differentiate, as we elevate the experience think about one of the biggest growth drivers we have just launched the end of last year. it hasn't had a chance to demonstrate all of the growth

ahead. that's sephora 200 stores will be in 600 by holiday of this year it's going to be a $2 billion business we're seeing a lot of incrementality in the business, lifting the stores by mid-single digits you have sephora, you have new brands that just set the end of last year. as well as over the long term, we announced we're going to open another 100 stores the model is really healthy. so omni channel, digital growth, the stores, and doing all of that while running a strong profitability 7% to 8% and returning to shareholders. so we have tremendous conviction in the business model, and like i said, in our capital allocation strategies as we go forward, and the last thing i would say, as was mentioned in terms of the future prospects, we have strong, diverse board. we're always open to ideas that are going to crate shareholder value. we did have unsolicited bidders earlier this year. we're working with goldman

sachs, doing our fiduciary duty as a board to look at those opportunities against the very strong plan that we shared today. we had inbounds, we did some proactive outreach the approach has been very thorough and thoughtful, and we're going to have a lot more the details in our proxy in the next 24 hours. we're taking our responsibility very seriously, but i'll end where i started, which is we have a great plan that we have great conviction is going to deliver significant shareholder value in the years to come >> michelle gass, thank you so much for joining us. and do keep us posted on those explorations michelle gass is the ceo of kohl's who has been under a lot of pressure from a number of different activists investors around the stock >> chronically cheap stock for a while, and a tough sector. but yeah >> she has had some good earnings the sephora partnership is set to grow. so we'll see how this shakes out. >> absolutely. we have got less than 40 minutes, about 38 minutes left until the bell

the dow is off just under 700 points right now the s&p 500 hovering just slightly above its lows of the day. down about 2.5%. still ahead, market expert ruchir sharma weighs in on the sell-off and the next trade he's recommending for the next decade check out some of today's top searched tickers on cnbc.com, ten-year yield getting the most interest, followed by bed, bath, & beyond, crude oil, and the s&p 500. buffett has a stake in occidental we'll be right back. through our grow up great initiative. and now, we're providing billions of dollars for affordable home lending programs... as part of 88 billion to support underserved communities... including loans for small businesses in low and moderate income areas. so everyone has a chance to move forward financially. pnc bank: see how we can make a difference for you.

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with rahel solomon >> here's what's happening at this hour. president biden spoke with the leaders of france, germany and the uk in a private video conference the white house says they affirmed their determination to continue raising the cost on russia for its invasion and to keep providing security, economic and humanitarian assistance to ukraine.

>> refugees are leaving ukraine by land and water. this video from romania's emergency management agency shows people escaping from odesa and nearby areas after arriving, crossing the river by ferry. >> and during a roundtable discussion with florida's governor today, the state's surgeon general announced he's now recommending that healthy children not get a covid vaccine. that contradicts the cdc, which says that children 5 and older should get the shot. >> and in her first in-person meeting since testing positive for covid, queen elizabeth greeted the canadian prime minister at windsor castle today. trudeau said she's as insightful as ever. back to you. >> thank you, rahel. >> after the break, can the man who spawned the gamestop trading revolution due the same for bed, bath, & beyond there are hopeful traders today. we'll talk about what ryan cohen's plans are for the retailer next. >> speaking of retail, web bush just slashed its estimates on a number of names in the space over fears surrounding the war

in ukraine we'll speak with the analyst who made the call and find out which names are most exposed as we head to break, a check on bonds. yields are higher across the curve today. ten-year yielding around 1.77% maybe with all the inflationary concerns around spiking commodities from oil to wheat to nickel, some wild moves overnight. we'll be right back. ♪ ♪ i call it.... the wheel. ok, this is a miss. it's a fork. i got ten forks right here, baby. a toilet? we're not animals. we go outside like humans. nobody's going to the moon, ever! why not? it's too far! it's far. like i was saying, it's ftx, it's a safe and easy way to get into crypto. ehh, i don't think so. ♪ ♪ and i am never wrong about this stuff. never. the pursuit is on.

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shares of bed, be beth, & beyond surging after chewy cofounder ryan cohen revealed a big stake in the company. what more changes cohen wants to

see. hey, leslie. >> cohen wants the company to streamline its turnaround plan to further align management compensation where shareholders and consider strategic alternatives like separating buy buy baby, or separating the whole company. cohen owns 9.8%, his own money i spoke with a person familiar with cohen's thinking earlier today. he's not going to wait years for bed bath to change, and he even hinted in the letter to the bed, bath, & beyond board he's considering if need be nominating directors other than himself because he's chairman of gamestop bed, bath, & beyond responded saying it hasn't had prior contact with rc ventures but it plans to, quote, carefully review their letter and hope to engage constructively around the ideas they have put forth. shares of bed, bath, & beyond surged at the open although they have pared back the gains, still

up about 30% right now >> and a crazy volatile stock lately anyway. it was up in this area of 20 a couple months ago. what's fascinating about the response is, of course, ryan cohen, founder of chewy's. he sold chewy's, for like one fifth of what the company is worth now, five years ago, and created a company disrupting brick and mortar retail. there's no demonstrated ability to turn around one this is the third activist effort against bed, bath, & beyond in the past seven years or so. >> yeah, you bring up a really good point his roots are in e-commerce. what he did with gamestop and what he's learned from gamestop, according to people who know him well, is this idea that he now better understands what brick and mortar entails, how to transform a business into being more e-commerce focused and he's hoping to to the same thing with bed, bath, & beyond. taking a brick and mortar native

company and apply those then to bed, bath, & beyond in terms of a tonaround. however, unlike with gamestop when he first wrote a letter to that company, it was all about the transformation with this one, you also have ideas of strategic alternatives, the spin-off of buy buy baby, the selling of the company outright those would be slightly different activist moves we see a lot and have seen in, as you mentioned, a lot of previous activist ventures with bed, bath, & beyond >> how did he become such a cult figure for retail traders? for the meme traders i can't -- there's no one else really that they follow like this he tweets out pictures of ice cream cones and then the stock goes up. how did that happen? >> i think part of it is the fact that rc ventures, the entity by which he's making these activist investments, that's all his own capital so i think the retail crowd really respects the fact that he puts his money where his mouth is, he has skin in the game. it's not the same as other

activist investors out there that charge 2 and 20 or more than that to manage other people's money and may not, at least in term of the retail crowd, have the same kind of incentives as he does to transform the businesses in the way they want them done. >> leslie picker, thank you very much >> what's also interesting is it's been the target of activists. it's also been the target of retail traders before. because it was heavily shorted >> heavily shorted, low market cap, and beaten down after covid. absolutely that's a little bit of, yeah, flocking back to a familiar name >> like a revival of the retail trade. we have just under 30 minutes to go before the bell here's where we stand in the markets. not too far off from session lows down 750 was the low, it came just a few moments ago the s&p down 2.6 nasdaq down 3% technology hit the hardest energy and utility stocks are the safe havens today. up next, we'll have much more on the sell-off with ruchir sharma. his thoughts on the volatility and what he says could be the

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stocks starting the week in the red, as the crisis in ukraine continues with the dow down more than 2% heading into the close. commodities one of the few areas in the green again today wti crude hitting its highest level since july 2008. gold briefly hitting its highest level since august of 2020 let's bring in ruchir sharma, chairman of rockefeller international, for whether this is a trend that will continue. ruchir, good to have you i guess the big question is

whether we're seeing just a sort of fleeting leadership shift from those disinflationary growth stocks that led the way higher into this year and toward commodity based companies or you think this is something that might last >> i think this is the trade of the decade i have been speaking about that for the last few months. the trade of the decade is long commodities, short technology. we went into this crisis in russia with the world very underinvested in commodities and relatively overinvested in technology this crisis has shone the spotlight on the problem with that, and i think that even though prices may ease, if we get some de-escalation in this tension, i don't think this trade is going to end anytime soon and it could last for the foreseeable future which is basically a decade >> you know, this would

correspond, if it were to happen, and as you point out in some of your work, with what happened in the 1970s or into the '80s, and then again, of course, in the year 2000 and the decade or so after that. those were periods when equities in general experienced, you know, a pretty long and grueling bear market. do you think that's going to come along with it >> i think the price of money is still insanely cheap, so that is something which the fall in equities, otherwise equities would be down more i think this marks the process of a major regime shift. it's very interesting, if you look around the world, a lot of emerging markets that are commodity exporters are in fact outperforming this year. even to these prices you have these markets that are doing well, and a lot of the technology heavy markets, such as korea or even china before that, those are not doing that

well i think this leadership shift is very fundamental in nature and even if the fall in equity prices is cushioned by extremely low interest rates which would rise but still from a very low level, i think that cushions it. but yeah, i think what we have to focus on here is this major regime shift where the balance of power is shifting back towards the commodity exposures away from the importers, exactly the mirror image of what happened last decade >> so the investment advice, what, is to stick with the commodity producing countries? buy their stocks, their etfs and away from some of the importers getting hit like india what are some of the other investor implications? >> that's one simple investor implication, and i also feel the great unwind in technology stocks is well under way and this has further to go i think as we have discussed in the past, once bubbles begin to

deflate, they typically see a decline of about 70% now, whether it's the entire tech sector, it may not be a bubble there are unprofitable tech stocks, some of the key energy stocks i think all of those could be down 70% from their peak some are already down 40% to 50%, but may still have some way to go. yeah, staying away from the technology space in general and towards commodity exporting countries like the ones i mentioned, i think is the way to go for the next few years. even if that is a bit tactically strict right now, strategically, that has legs. >> ruchir, thank you very much we'll have you back to check up on the trade of the decade >> thanks a lot. >> all right, straight ahead, a top analyst outlines how retail stocks with exposure to europe are being impacted by the war in ukraine. he'll tell us the names under the most pressure. at nt t mkezone

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welcome back here's a look at what is ahead on the second hour of "closing bell." energy expert tom kloza will give us the reasons why he thinks we are witnessing the most serious oil crisis of our lifetimes. >> we'll ask jj kin ahen about how retail investors are faring and what he's advising them to do next. >> former defense secretary mark esper will weigh in on the debate surrounding banning russian oil and instituting more sanctions, and donee dwyer will break down his call for a year end recovery for the market. first, we have 14 minutes left to go in the trading day we're now in the closing bell market zone. joining us is xp investments principle.

welcome to the show, we'll kick it off with the broader market stocks near session lows selling off hard as commodities like oil, wheat, and nickel spike today. the dow is down 2.2% the nasdaq is down 3.3%. are you selling into days like this >> i really think you have to -- you have to take it all into account. clearly, we were already in a risk-off posture to answer your question, investors, myself and others, have been selling into what we have seen as a secular shift away from tech heavy s&p, nasdaq, and other subsector etfs and related securities but the geopolitical risk that's clearly headlining us has been underscored by other things that i think may be a little more nuanced. the twos/tens yield curve has been steepening. we have seen that translate to weakness in the banks which is why you see everything wrapped up in this risk-off posture. >> i guess the question is what you would be looking for as a clue that maybe it's running its

course is it as simple as if oil reverses lower, if the yield curve starts to resteepen again, or are you looking at anything in the equity market behavior that could tell you the correction is getting to a mature spot? >> well, given the sizes of the fixed income market vis-a-vis the equity market, i tend to thing that's the dog wagging the equity tail. certainly, the yield curve is a key data point and has been an indicator of recessions throughout history so that yield curve is definitely something i'll be having my eye on the price in oil and other related commodity shocks clearly isn't good for equities. i think there are commodity plays to be had here in an inflationary environment, but i think the yield curve is key, particularly when you start to drill down in the wage growth or lack thereof, jobs being added and the fact we're still trading down despite what was a pretty robust jobs report out friday. >> yeah, and obviously, a bit more than a week until fed comes in with the first expected rate

hike we'll see how the market absorbs that let's move on to travel stocks, continuing to get crushed amid the spike in oil prices. seema modi has more details. >> hey, mike we're starting to hear from more executives marriott ceo just spoke at jpmorgan's gaming and lodging conference on the impact of the ukraine crisis hitting demand. he said we continue to see strong forward bookings into europe and the last four or five days we have seen a really modest uptick in cancellations, but nothing measurable at this point. marriott has about 28 managed and franchised hotel in russia it represents significantly less than 1% of total fee volume. not a big market, but again, the concern is the extent to which geopolitics will prolong the recovery the cruise lines have fared the worst of all travel related names and as it pertains to oil, morgan stanley says royal caribbean is the most hedged followed by norwegian cruise line

back to you. >> seema, those things suggest what marriott is saying on bookings and what perhaps the cruise lines have to offer in terms of being somewhat hedged, would suggest that, i mean, we're basically, the market is trying to handicap some kind of significant scare in consumer psychology that's going to keep them from traveling, and we don't yet see it in the boo bookings >> not at this point, since the pandemic has waned, we have seen demand for travel accelerate as highlighted by the major travel companies since they reported earnings just a couple weeks ago. since the invasion related to russia and ukraine, getting concrete bookings, we don't have that clarity yet right now, we have to work off the commentary we're getting as soon as we do, we will report them >> seema modi, thank you >> what do you do with the airlines there was so much hope for another reopepen en opening ofe back of omicron, but that's slamming into a geopolitical crisis which keeps people home

and elevated oil and fuel prices what do you do with those stocks >> you hit the nail on the head. i was taking a look at the jets etf to give you a barometer of hour they're trading keep in mind the enterprise values really led by debt burden exploded through covid so they can navigate through that. you couple in the fact they have a tough time passing on jet fuel costs the end user, at least in a meaningful way it's just tough to be constructive the cruise lines, although hedged to an extent, that's still going to be more -- the type of travel you elect when you have discretionary income. being we're worried about consumer spending, being it's such a large portion of gdp, it's hard for me to really have a constructive stance going forward. >> what about the credit card stocks they're getting crushed today. kate rooney taking a look at some of the names there. kate >> hi, sara. visa, mastercard, amex, and paypal lower after suspending all operations in russia

it cuts off individual russians from making payments overseas or using e-commerce cards issued outside of russia won't work at local merchants or atms visa and mastercard get about 4% of revenue from russia the revenue impact on paypal is even smaller, about 1%, amex is even smaller than that but the other big factor weighing on these payment stocks, higher gas prices that's threatening consumer spending which could weigh on payment volume back to you. >> kate rooney, thank you. we have a news alert on cybersecurity firm mandiant. kristina partsinevelos with the story. >> a report that google is in talks to buy mandiant. this is a cybersecurity firm, such a purchase would allow google to expand its cloud services division and this potentially could be the second largest acquisition for google this information is coming out right now from the information website. we did see shares of mandiant briefly halted they jumped up about 12% and

we're seeing them higher right now on the news. i'll send it back over to you guys >> thank you what's so interesting about this is that microsoft was supposed to be in deal talks with mandiant a few weeks ago we had that news report out. we talked to kevin mandia last week i asked him about it stone faced, did not comment, obviously, on market speculation. this would suggest - >> yeah, you usually don't get this type of kind of multi-part chatter unless there might be going something going on this is a tiny deal relative to google, right? alphabet, you know, $5 billion market cap right now, but even so >> we were saying that on microsoft, too >> the sense out there that alphabet feels the can make this scale of acquisition at a time when the anti-trust situation is such that they feel there's a chilling effect. >> we do need to ramp up our cyber defenses >> it's not an area google has >> web bush wanted to hit the retail note, lower estimates and

price targets orb eight retail names today with exposure to europe the firm also downgrading pvh and ralph lauren to neutral from outperform those shares are getting crushed today with the broader market. joining us is the analyst behind the note, tom, tell us what you're looking for in certain names and why they're so exposed. >> so look, i think given what we saw in ukraine last week, especially after the attack on the nuclear reactor on thursday, that was a bit of a game changer as far as gauging european consumer sentiment i think a lot of these companies that have meaningful exposure to europe are at risk of seeing waning consumer demand and i thought that ralph lauren and pvh, which had very high exposure to europe and europe has been the primary growth driver for these brands as well. i thought that it made sense to step to the side

>> tom, i mean, pvh is close to cut in half off its recent highs. it looks like it's a relatively inexpensive stock. you're sort of saying even from here, you think the fundamentals are going to erode that much based on what's happening in europe or you just feel as if theer the investor mood in this direction is still going to be sour >> yeah, i think investor mood will be sour, and look, pvh is down almost 30% in the last two trading sessions so to your point, i'm not sure there's a lot more downside risk from here as far as the stock goes i do think given this overhang, investors may be hesitant to step in to buy a name like pvh, even given the pullback we have seen >> what about u.s. exposure? do we need to start worrying about the state of the u.s. consumer >> not yet i'm not worried yet.

obviously, if this thing drags on or we see much more escalation, it could happen. we have been a little more positively inclined towards the names that are more domestically skewed we upgraded carters today in conjunction with this note they generate almost all of their revenue in north america and has a much more defensive business, selling baby clothes it's not nearly as discretionary as the rest. so i definitely favor domestic exposure today over european >> there is one consumer discretionary name higher today. can you guess it >> tesla >> tractor supply. not even tesla, mike they're all lower. >> tractor supply is a great long term winner tom, thank you very much that carters also a play in a mini baby boom going on, according to his notes as well >> we are just hitting new lows just about for the session s&p 500 is hovering just above that 4200 mark that would be a closing low of

this correction, if we did get down there, it takes us back toward june levels of last year in terms of the downside is this the kind of close that you want to see to get some kind of maybe a little bit of a flush and a capitulation, or are we not there yet? >> i'm not sure we're there yet. i would still watch the 4100, 4200 channel we tested previously and see if we hold there. i definitely don't advocate throwing the baby in with the bath water you know, still continue to view the market, be cautious, and take your opportunities there. clearly, valuations have come off, so i think there's some opportunities. i just think you need to be a bit picky and choosy in terms of not trying to fight momentum and trend. >> how much exposure should you have to defensive sectors that have held up better? staples, utilities are higher today, and which groups do you like there >> sorry, i had a hard time hearing you there.

but generally speaking - >> asking about defensive. >> i would agree i would say health care sector definitely gives you a bit of a defensive posture. i would shy away from the consumer discretionary i would lean more staples, top of market type names costco, walmart, things of that nature >> costco actually has come back nicely since the sell-off following its results. and of course, it's part of consumer staples even staples getting hit today, down 1.8%. pretty broadbased selling all around it had the look of people retreating from equity exposure through the indexes in general take a look at the internal measures the equity advance decline line has been skewed to the downside. the declining volume well more than twice as much as advancing volume a there you have significant downside pressure. people feeling it has the look of some declines and margin

balances and things like that and maybe some margin calls out there in some of the highly levered names when you have losses taken on the short side i want to take a look at amazon because this is a stock breaking to new lows relative to january and february it's now down, that's a two-year chart, from all the way back to june of 2020 so both the retail and the cloud components, neither one helping amazon it's traded basically with both of those groups at times and both are under significant pressure the volatility index is up toward 36. 36 is the threshold that some people say, you know, over history, if you bought stocks when it spikes up to 36, it tends to be okay longer term, but there's a lot of anxiety built into this number the vix futures curve is upside down basically showing a big premium to near term volatility protection that sometimes means there is a bit of stress in there as we head to the close, the s&p continues to stick around that 4200 level 4100 to 4300 broadly speaking is

viewed as this kind of support zone out there that a lot of folks are looking for to hold, and if it doesn't, opening the way toward some crack of 4,000 in the 3800 would be something along the lines of a 20% decline from the high, which of course is rare outside of recession, but it certainly does happen as it did in 2018 >> a lot of selling there into the close. down 800 points on the close for the dow. welcome back to "closing bell. i'm sara eisen here with mike san holt santoli. coming up, tony dwyer on whether he sees buying opportunity amid the sell-off plus, mark esper on the possibility of the u.s. will sanction russian oil and gas that oil spike causing a lot of consternation about the economy and inflation. bon awn iceman is still with us. alicia levine joins the conversation alicia, really ugly close.

down 3% on the s&p nasdaq down 3.6% it was pretty bad all day, but saw a lot of selling there into the close. what are you hearing from your clients and what are you telling them >> look, it's pretty brutal out there. our clients are sitting tight because we ultimately think there's no recession in the u.s. this year. and so ultimately, wi think there's a market recovery in the second half of the year. but it does look like we have further downside in the next -- in the near term as we head into a fed meeting and frankly the war in europe is very uncertain. and the market is pricing in a greater risk of recession, and also just the uncertainty to how this actually plays out. so not entirely unexpected i agree that the final flush has not been done yet. and i guess what is somewhat disconcerting is the channels we have been in is moving lower so yes, 4100 needs to hold here. otherwise, there's risk to further downside

>> alicia, you said that, and certainly by the looks of many areas of the market, we are pricing in a somewhat elevated risk of recession, or at least flirting with the consumer type recession down the road. it's obviously not there yet, but if you believe that that's not the likely outcome here, would you be actually looking in those consumer cyclical type areas of other kind of economically sensitive ones to rebuild exposuro is it not the time yet >> i think it's not the time yet. it's fairly clear the lower end consumer is going to be hit and hit first because of where oil prices are and how that filters into the household budget. we're starting to hear that from companies. that the lower end consumer is starting to trade down to private label. we do like travel and leisure here, and i actually think the sell-off is a great opportunity because i think if there is a spend budget, must will go into

the travel and leisure budget. i think cyclicals in a rate hiking environment remain risky even as the stocks have come down so housing and autos i think are still problematic simply because we do see rates going higher the fed in the end does have to walk a tightrope, and they're going to choose to fight inflation even if we're in this kind of murky macro environment. >> i feel like we should not downplay the kind of moves we have seen in the commodities market lately. brent saw its biggest ever swing today, reached $140 at one point, nickel on the london metals exchange at one point was up 70% before coming back. gas in europe continues to surge. so have we ever been in an environment like that with commodities where we don't enter recession because of an energy shock, a potential food supply scare here >> arguably, 2011, you saw something like that where we are sort of seeing the aftershocks of the global financial crisis and you saw oil surge again.

never forget, the ecb hiked rates in 2011 because they were afraid of what was going to happen with inflation and oil. yes, it was a mistake. look, the argument against it as you know is we're not as commodity intensive in terms of every unit of gdp as we used to be, and on a very long term basis, nomtle term, not very hot. to me, the bigger immediate concern is the kind of portfolio stress that it reflects. in other words, somebody was short all these things or somebody desperately needs to find the physical supplies and deliver it or to use it. and so that's the kind of thing, i would love to have your take on this, unlike stocks and bonds, which are pieces of paper that people make a value judgment about when they decide how much to pay for it or to sell it for, when you're talking about if you need the physical product, you're going to have to chase the supply almost whatever the price is or go broke doing it so what does that mean, do you think, in the short term in terms of what the ripple effects

are? >> well, in terms of the commodity market, you hit the nail on the head here. it really is supply and demand driven and trend driven. it's a lot more inelastic from a demand standpoint in terms of what people need as an input as they're producing whatever distillate or end user good. in terms of there, as long as geopolitical headwind exists and persists, i don't really see how prices abate make no bones about it, whether it's wheat, soft commodities, or palladium and gas, other base commodities, they're coming utof that region that's having this cension, so there's really no way around it. in terms of how to play it, and you alluded to it as this being a trigger of economic decline, what's unique about this situation is the fed has little wiggle room in terms of what's they can do given the flainflationary pressures and where rates are. that sticks out to me. >> so alicia, why are you

sticking with the no recession call i realize that's consensus, but given that kind of backdrop, we continue to see inflation expectations surge here, the break evens, we saw yields go up today. and fed chair powell last week invoked paul volcker and said he was prepared to act like that, which ultimately ended up hurting demand and bringing us into recession when it comes to fighting inflation >> look, a great question because i do think the risks have gotten greater for recession, but ultimately, with the labor market this strong, you don't just head into recession out of nowhere and i think that, yes, if the geopolitical situation lasts longer, and 30% of the world's wheat, which comes from ukraine and russia, stays at elevated prices, you could have a consumer-led slowdown, but again, that, i believe, would be quickly reversed when the conflict reverses. because the fundamentals of the economy are actually very

strong it's easy to feel very despondent and to start playing takes from the 1970s and the 1980s about where we're going here, but i think ultimately, the fundamentals of the economy are pretty good. labor market is telling us that. so for now, we're looking for a midcycle slowdown. we are looking for earnings to come in. we don't think they're going to reach the heights that the sales flight has right now nevertheless, we think you end the year in a place that's not in a bear market, and you stabilize some time midyear. >> and alicia, if you do think that the economy has got enough stability underneath, enough momentum in enough areas, presumably, that's going to be okay for things like corporate bonds, which have sold off but maybe not to critical levels, but has any value been rebuilt in those areas in terms of just yields going up without that much erosion of fundamentals >> that right, don't forget, corporate america is flush with cash, and i would say the

sell-off in the financials here is probably an opportunity as well we are entering a rate hiking cycle. we have sold off meaningfully in the last two weeks bringing some of that multiple down. and ultimately, if your call is that there is no recession in the u.s., even if there's a slowdown, the banks are already reflecting that. i think it's probably interesting place to enter look, you have to be brave here. the time to invest is when everything looks the bleakest. this is what we learned over the last several decades of doing this so i think that if the fundamental call is no recession, then it's okay to start nibbling here. no question. >> down 13% on the s&p from the intraday record highs. down 21% on the nasdaq alicia, thank you for joining us good to get your take. bonawin, we want to zone in on your top pick. what is it >> so it's ctra, i'm going to ride the trend here. nine times price to earnings

5 1/2 times price to cash flow, and it's got about an 8% dividend yield i like that and the exposure to energy if i'm going to play something long, i'm going to ride the trend. >> thanks very much. appreciate it. we'll catch you again soon >> thank you >> all right, let's get to kayla tausche for the latest developments in the war between russia and ukraine hi, kayla. >> hey, mike an adviser to ukraine's president said there were small bits of progress in talks of a cease-fire, but that remains completely elusive a senior u.s. defense official says russian troops remain on the outskirts of the largest cities and russia has ramped up the usage of rockets, missiles, and artillery as ground forces have met resistance. today, the white house said 93 decision has been made on an oil ban of russian imports to further punish president putin and acknowledged the u.s. had held separate discussions with

iran and saudi arabia on inaern production, but there is no plan for president biden to travel to saudi to push up supply as had previously been reported mike and sara. >> what do we know about this executive order on bitcoin and cryptocurrencies as it relates to sanctions >> well, we know it's been expected for quite a long time the administration has been putting pen to paper on exactly what this is going to look like. and i have learned from an administration official that we are expecting to see that eo released by the middle of this week the executive order is going to be directing different agencies to various exercises in the policy making process where digital assets are concerned, with deadlines ranging from three to six months to turn in reports on how they will do that, so we're expecting that to come by the middle of this week. it's being closely watched by a lot in the crypto space. >> absolutely. thanks for the reporting there mike, sort of surprising that crypto hasn't done better.

i know sometimes it trades like a risk asset, so the market sold off t followed tech lower, but this was supposed to be a new use case for bitcoin, getting around sanctions, taking donations for ukraine, and it hasn't been acting that way in the last few days. >> russia itself was not very friendly to crypto i think that's one of the ideas. in other words, it wasn't as if there was a steady pipeline coming in and out in terms of transactions they could have utilized it too much, and lots and lots of logistical choke points in terms of trying to do anything in terms of size. but absolutely right even psychologically, you would think this would be the thing that would endorse the kind of promise of crypto, and it's not been the case. trading like it's on the nasdaq. >> although i guess it could be worse. it could be down with the wild swings in crypto, 10%, 20% >> yeah. all right, we're just getting started on the second hour of "closing bell. up next, we'll discuss the ripple effects soaring oil and gasoline prices are having on the transports and broader market, and later, former

defense secretary mark esper on the potential fallout omfr sanctions russian oil and gas.

we have some breaking news on the crisis in ukraine let's get to steve liesman steve. >> sara, thank you very much i just did an exclusive interview with president zelenskyy's top economic adviser. he talked to me from a location in ukraine that could not be disclosed for security reasons he urged the west to cut off purchases of russian oil and gas. calling the $1 billion of money sent to russia, quote, bloody money that finances the russian war machine and the devastation on ukraine and its people. >> it's just incredible because whoever is buying this oil and gas, they are responsible also for financing these aggressive russian putin russian machine which kills our people and all

these terrible dark ages things in my country. so for us, it's extremely important to cut off them from these bloody money and we do believe that by doing this, we will be able, really, to hit russia very hard. >> he said he has family cut off in the besieged town of irpin said many are cut off and don't have power, and says ukraine continues to pay its bills and civil servants and grain stored to feed its people the country had suspained roughly $100 billion in damages from the russian invasion beyond, of course, the horrific human toll and he said if ukraine crops are not planted in the next several weeks, ukrainian farmers who export considerable volumes of wheat and sunflower to the rest of the world will miss their

growing season entirely, and michael, he also pointed out that the very places where russian forces are, are the most prolific agricultural lands of ukraine. mike >> i was just going to ask a question first, we haven't even focused on the ukrainian economy because it's been such a humanitarian crisis and, you know, the safety concerns there on the ground how tied to russia is ukraine from an economic perspective >> it's very tied. especially in those eastern provinces. and so ukraine would get it from both sides, in other words, it would be hit from obviously the war and hit from cutting off from russia. and that's something that's going to have to be completely rebuilt, depending upon how this war comes out. that is an excellent question. ukraine is going to have a lot of problems, depending on how the war comes out. even if it defeats the russians. rebuilding part of the ukrainian economy that is tied to russia but also tied to the west, and

through its ports, its crops do go out to the rest of the world. >> yeah. obviously the stakes very high on so many fronts. steve, thank you very much for that >> sure. >> oil meantime as we have said, hitting its highest level since 2008 today tom kloza from the oil price information service says this is the most serious oil crisis in our lifetime tom joins us with cnbc senior international correspondent brian sullivan to talk more about it tom, so the most serious energy crisis you think in our lifetime does that mean that, you know, higher prices, you know, essentially don't bring out new supply, that in other words, we have repealed the rules of what represents a level where finally we're going to destroy demand and it's going to correct itself >> well, i hope we get higher supply here in the u.s and we are going to see more supplies from guyana, brazil, norway, and others, but there seems to be almost kind of a

gentlemen's agreement not to exploit the resource too much because people have been through these boon and bust cycles the russian oil, i mean, 9 million, 10 million barrels or whatever you want to call it, europe is the one that is desperate. europe is desperate for that oil. we keep talking about a ban or some sort of act of congress or whatever, but the way it is right now is there is a de facto ban on russian oil for most of europe, exception of germany, and we're even starting to see that in japan and we'll see tin the u.s. it's not a real -- it's not insignificant, the amount of russian oil we import, but it's not as significant as mexico or canada or some of the real big trading partners >> well, this is what i think is important to try to focus in on, because if there is, tom, essentially a de facto near ban on russian oil right now, then it's not -- it's not reflected

in the price that supply is simply not there. so where is the price headed if we have to be in the situation for a little while are we basically just going to, you know, kind of curtail demand and that's the only way out of this, or can we find an equilibrium before that? >> that's the real question. i have said this many times and adhere to this view that we don't measure oil statistics, particularly internationally, with precision instruments it's like cutting your hair with a chainsaw we don't know if the world is using 3 million barrels more per day of oil or 4 million barrels or whatever. we know it's being depleted, and we know we're going to need more oil. but we don't see anything necessarily to replace the russian oil anytime soon now, there will be demand destruction. the banks will tell you you're not going to see demand destruction until you see $5.25 gasoline and $185 a barrel crude

oil price. if that's the case, we're probably headed into recession in my belief, which we found out in 2008, the last time we had numbers that's were equivalent the kind of silent killer out there that really isn't being talked about and has been the product that's moved up the most, most recently, is diesel fuel you don't care aboutit unless you have a fancy car, but it fuels inflation in every nook and cranny >> that's a good point brian, you're at one of the biggest energy conferences of the year, surrounded by all these oil ceos what are they saying about the potential lack of russian barrels on the market, whether they can ramp up production to meet demand, and who else is out there? >> they can't meet this kind of demand, and opec is saying the same thing opec headlines, they can't make up for loss of russian oil maybe a million barrels, yeah, but not 3 million barrels, not 5 million barrels. canada, mexico, the united

states, even all coming together, probably can't meet that if you tied every major producer in the world in, you might be able to get to 2.5 million to 3 million extra barrels, but it will take six months to 12 months oil is a long term project it's not like we need more yogurt increase the yogurt supply, right? this takes a long time labor, drills, rigs, pipeline, people, everything so to make up that kind of loss is simply not feasible, sara, in the near term. everybody, i will say, we have talked to some people and got like seven ceos tomorrow, by the way, that this is not good for the industry there's a simpleton view that, oh, guess what, if oil prices are high, oil companies are going to boom. no, because number one, the public is going to have a backlash on them, start talking about the industry again as destroying america. and number two, you don't plan three years out because the

price of oil spikes to $125 overnight. they want stability of prices. two years ago, sara, we were negative $37 a barrel. now we're $137 a barrel. >> unbelievable. talk about a trade of a lifetime to buy oil down in that negative territory. brian, any targets you're hearing? what do they expect oil to do? how high could it get? >> well, it depends on two things number one, how long this conflict, this putin's stupid war goes on. if putin realizes he's lost, and he has lost, if he realizes he cannot win and somebody gives him an elegant or inelegant way out and the war ends, hopefully sooner than later, the price of oil may fall dramatically quickly because russia may be able to pump more oil. remember, a lot of the oligarchs there make a lot of omoney on petroleum. the other side is if there's direct sanctions on russian oil and/or gas and/or this war goes on for weeks or months and

russian oil stays off the market, there's no iran deal, there's no venezuelan deal like there have been reports on, there are targets out there that say $150, and i'll leave it with this, and tom probably knows more than i do, bank of america said today that for every 1 million barrel swing in supply or demand, it will impact prices by $20 a barrel. so let's say we lose another 2 million barrels, that's $40 a barrel puts us at $145. the inflation adjusted all-time high is about $180 in today's dollars. that's what we hit in 2008 >> brian sullivan, tom kloza, thank you both for joining us. brian, we'll look for your interviews all day tomorrow. >> when we come back, mandiant shares soaring on a new report on information google could be acquiring the cybersecurity company. we'll talk to the reporter who broke the story. >> later, airline stocks falling hard as oil prices rise.

the jet fuel costs go higher we'll get more on the outlook for the ct wn long llreturns."csi

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shares of mandiant surging following a report from the information that google is in talks to buy the cybersecurity

firm for $4.5 billion. joining us now is the reporter behind the story, josh sisco it's good to have you on here. i guess in simple terms, what is the appeal of mandiant to a company like alphabet, we already heard some rumors beforehand that perhaps microsoft might be interested. what specific role does mandiant play in the cybersecurity world? . it's a consult aancy that has st of focused on countering cybersecurity threats and for a company like google, it would really bolster its cloud business, which is sort of trailing behind amazon and microsoft. >> is it your reporting that microsoft and google are in some sort of bidding war, that they're both interested, or you're just discovering the alphabet piece of this puzzle? >> so it was already reported that microsoft was interested. we just discovered the alphabet google piece of the puzzle it does seem like they're in

competition for the company. it's not the first time, but that is the new interesting news here >> and you know, we were just sort of speculating before that of course while not a huge deal relative to the size of alphabet, which is over $1.5 trillion in market cap, it would be its second largest acquisition ever, google's would it at all trigger any scrutiny in terms of antitrust >> i think so. i think you can't talk about google and a large acquisition without talking about antitrust at this point. the climate is certainly turned against some of the largest companies, especially some of the largest tech companies and so even if there is no ultimate problem, i do think that the ftc or doj would definitely want troon it down and make extra clear they were comfortable before they let it go and that goes for international regulators too >> josh, we appreciate you

jumping on to fill us in on the story. >> thank you so much >> thanks a lot. up next, former defense secretary mark esper on whether the threat of banning russian oil imports will be enough to end the conflict in ukraine. >> plus, tony dwyer on whether he sees buying opportunities amid today sl-f.'selof leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire

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take a look at the dow winners and losers of the day. only four stocks in the dow up on the day here you go, energy and some defensives like johnson & johnson and amgen as well as merck. caterpillar up also .5%. the losers, financials had it hard all day american express was the biggest loser on the day and then some cyclicals and consumer branded companies having a hard time people think the global consumer is going to be in some tough straits with energy doing what it's doing boeing, nike, walt disney, and mcdonald's round out the bottom five time for a news update with shepard smith. >> thanks. from the news on cnbc, here's what's happening no decision yet on a deal to send polish fighter jets into ukraine. that from the pentagon spokesman john kirby in the last hour. he said nearly 100% of russian troops amassed at the border are

now inside ukraine, but there's been no or nearly no progress by russian troops in the north of the country that's forcing them to rely on longer range attacks. >> well, as gas prices huddle near an all-time high of $4.10 a gallon, there's bipartisan agreement on banning russian oil and gas. the leaders of the house ways and means committee and the senate financial committee today agreed to legislation that would ban russian energy imports to the u.s. whether president biden will sign that is an open question. he met with several members of his nato counterparts today but says a decision has not yet been made >> and the united nations relief agency or refugee agency reports as of today 1.7 million refugees have now fled ukraine. more than a million of those taken in by poland since the russian invasion began cnbc's perry russom is live for us in warsaw perry. >> shep, the refugees making their way west through pole nld, most of them are stopping right here in warsaw

we went to three train stations today. they were overwhelmingly busy. so many children we saw. we have been here for a week it's still incredible to see and think about the amount of kids we have seen on a daily basis here in poland today at the train station, they were sleeping on the bround. some were sleeping on benches, air mattresses, and some were simply running around. their mothers were just standing there stoically, trying not to show their emotions so their children did not feel what they're feeling. we talked to one woman and simply said how are you feeling? she just broke down can cried. we also went to a sherlt in warsaw there are 500 beds there people are being brought there on a daily basis but they can only stay there for three days, and then they're told it's just time to move on so they either get a train, a bus, or a plane, but they have to continue on their route west. we talked to a woman who is running that shelter before the invasion started, she was simply an event organizer. once the invasion started, she

dropped off her 5-year-old daughter at her mother's house and has been running the shelter 24/7 we can see how tired she was in her eyes and on her face we asked her how much more can you do of this she said she simply has no idea. shep >> perry russom live in warsaw on the extending refugee crisis there in poland and beyond tonight, in addition to perry's reporting we'll take you inside ukraine as stranded civilians desperately try to find a way out. plus, an nbc news exclusive. training with nato troops on the eastern front in latvia. that's on the news, 7:00 eastern, cnbc. back to you. >> all right, amazing to get those personal stories thank you. we'll look for you at 7:00 for more on the russia/ukraine kries, let's bring in mark esper, former defense secretary donald trump how are you thinking about the timeline now >> hi, sara and michael. good to be back with you again look, this is going to drag on

for many weeks if not several months and i think we need to be prepared for that. we reached opoint now where as in all conflicts it's a contest of wills in this case, you have the will of vladimir putin versus the will of president zelenskyy and all of the ukrainian people. so i see this as dragging on for quite some time. that means we need to be prepared and be doing everything we can to try to curtail the conflict and as i know many of your viewers are interested in, i have been arguing since day one we should employ the full panoply of economic and financial sanctions including energy sanctions on russia in order to get them to back down in this conflict >> it looks like there's some movement on that front certainly from congress and growing opinion in the u.s. that that is what should happen germany is not there yet if we do go that route, energy sanctions, do you expect it to change the outcome for president putin? >> well, it could, which is why i disagree with these graduated

escalating sanctions we should employ them all now. for the united states, i mean, russian oil imports are 8% the challenge, of course, is germany, which gets 70% of its energy from russia but that's no reason why we shouldn't. i'm glad to see there's bipartisan action in congress in both the house and senate to do this i don't understand why the biden administration won't move forward. the fact of the matter is gas prices will go up. they have. we breached the $4 mark today. i do think and polling supports this that the american people understand this and are willing to pay more at the pump in order to help the people of ukraine and the tragedy that they're undergoing right now >> mr. secretary, you said you don't kind of agree with this sort of graduated sanctions scale, holding things in reserve perhaps, but if in fact the u.s. were to impose sanctions on russia, what should it come along with in terms of a path out? is it absolute in saying full withdrawal and a return to what happened before the invasion or is there room within this to

negotiate stages >> well, we talked about this last week. and i contend we should follow the lead of president zelenskyy and the people of ukraine. my view is we should go back to pre-2014, before the russians invaded crimea and eventually d donbas, those are the historical borders of ukraine and the sovereignty we should respect. it's not just energy, we have consumer goods, agriculture coming from ukraine. it's hard to see where the supply lines stretch we rely a good deal on titanium from russia, so i think we need to be prepared for the long haul and what this means because also at the end of the day, if there is some type of agreement or not, if this just drags on, at what point do we think american companies or the u.s. government or the eu is going to relent on sanctions? i don't see how we can unless russia pulls out of ukraine consistent with what the ukrainian people want. >> only have time for one more i was deciding between iran and china. but i think both of them maybe

can go into one, which is the russian relationship with both china is backing them, the russians are participate of this resumption of nuclear talks which apparently is moving closer with iran and unleashing their barrels of oil how much support does russia have there between the two of them and what do you think happens with all that? >> well, they do have some support, probably more from iran right now than china china has been put in an awkward position in early february, she gin pang stoond alongside vladimir putin and they extolled their virtues of governing and how democracy is not working, yet china finds itself in an awkward position where it's long standing policy of no foreign intervention in other countries' affairs is undermined by putin's invasion of ukraine so they have been noncommittal, neither supporting russia in places like the u.n., nor standing with us they should stand with us. but that is the nature of the great power competition we're in today and will last for quite some time, unfortunately

>> and iran and the nuclear deal, if they agree? what happens next? >> we'll see what happens. the reports coming out is they're close on a deal. the reports also indicate it won't be a better deal than before it won't be longer or stronger, as was promised. we need to see the details but to think that somehow we're going to try to rush the deal to get more oil on the market or go to caracas, to venezuela to get more oil doesn't make sense. u.s. domestic producers can fill the gap if we sanction russian oil. i don't know why we don't move on both fronts >> mark esper, good to get your thoughts thank you for joining us >> thanks. >> former defense secretary. >> up next, a look at why bonds have not been providing as much protection for stock investors as they typically have in the past >> andlater, tony dwyer on why he still thinks we could see a year-end turn around for stocks. welcome to ameriprise. i'm sam morrison, my brother max recommended you. so my best friend sophie says you've been a huge help.

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stocks ending the day sharply lower. the dow falling 800 points at the close. the nasdaq finished lower by 3.5% let's go back to mike at the telestrator for an updated look at the correlation between stocks and bonds and they were not such a safe haven today. >> not at all. value of bonds went down therefore, yields wnt up that's been kind of consistent with a more recent pattern blackrock has this chart this is the gain in bonds on days when stocks are down. so typically, you had inverse

relationship and you would have some benefit from bonds when stocks are down. this is a small loss this is a medium sized loss. that's a bigger loss for stocks. this is different periods. currently, you're seeing very small gains in bonds on days when the equity market goes down clearly, the buffer effect is weaker, certainly relative to what it was in the 2008-2020 period people are looking outside of fixed income for some kind of stability in their portfolios. something that's going to be an offset within equities it's onbeen consumer staples or in general the idea of a quality type of large cap stock. so take a look at the performance recently of dividend and buyback stocks as well as outright buyback stocks. this is just pure buyback. this is dividend and buyback, shareholder return of course, that's the s&p 500 consumer staples but here's quality why is quality doing so poorly and underperforming?

because it's all tech. so it became a tech index, so really what you want is genuine diverse shareholder return, things like dividend and buybacks blended together, also called shareholder yield it's not going to escape stock market losses but it perhaps is going to mute the volatility >> if you look at what's working in the month of march, the sectors higher besides energy, utilities, real estate, and health care. consumer staples not too far behind >> yeah, absolutely. it's been pretty textbook in that respect >> gold got another 2% rise. >> the major averages did sink in the final minutes of trading. got even lower to new session lows fears surrounding the russia/ukraine conflict dominating up next, a top strategist's take on how investors can best navigate all this uncertainty and what he's restfocaing for the rest of the year "closing bell" will be right back

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investors of the current bull market tony dwyer says it's important not to become too negative he joins us now. tony, always good to have you. are you sticking with the forecast that stocks will rally and recover into the end of the year >> into the end of the year, yes, i am. i don't think we're going to have a recession i think it's already one of the worst years. you know, we're already down 20% on the nasdaq comp as of today, i'm told the russell 2000 is down 20% the s&p 500 is down about 14%. so you're in a situation where the market is already down so much as you know, sara, we came into the year thinking it was going to be a tumultuous year on the back of monetary policy uncertainty, economic growth transition from buying stuff to doing stuff, which was going to lower production all those factors are in play, and you throw in this terrible situation in ukraine, and you get the kind of weakness that we have had but i think it's important at

this point when the expectations for the fed are to hike so many times into the teeth of this global crisis, it seems like a stretch to me. so i could see some pathway to a better environment toward the year end >> what about just the fundamentals that have the fundamentals that have changed and nobody did expect like oil at $120 to $130 per barrel and wheat sources, we were already dealing with inflation problem you don't see that as a potential game changer here, that we have a new surge in prices from everything from metals to food to oil? >> ultimately, so that begs the question, when is it going to hit profit margins right. when will people spend less and not be able to afford anything it is a horrible thing an the problem with inflation, it hits the people that can afford it the least. the lower income brackets. the higher income brackets is not as much. just to give you an example in

the end of january, if you look at second lowest quent aisle, if you look at the lowest income, gas accounts for 9.7% of the income, for the top 10% it was about 1.5% so it really is skewed to the lower income individuals and sara, the whole point is inflation has been with us we've got it if you look at the fed funds futures relatively to what the dot plot is, the market is way ahead of what the fed has been saying for quite a while now so the debate isn't whether we have inflation and we've talked about this on the the show before it is there and it is obvious. it is what will happen into the second half of the year when you go through this growth transition and throw in economic slowing from what is taking place in europe and maybe you won't get the fed to be as aggressive as the market believes they will. >> tony, tumultuous first half as you've been calling for we're not even half way through

the first half so what is your best guess on the cadence of things? in other words is it plausible that we've seen the lows and are we going to have some of the downside over shoots. >> i think we have a downside overshoot. and i don't think it is one of those things that will last for two weeks. i think it is pretty quick and ultimately you should have a snappy reflex rally back and then the question becomes do you go back down if you look at 2018 when the fed started raising rates, it had a pretty big impact early in the year you rallied all the way to a new high before you got absolutely lamb basted into the christmas eve low. so it depends on how we bounce back from the condition and the question that i've been getting because i'm typically seen as always being bullish, the question that i'm getting, why aren't you going in and the answer is when you get this oversold, it typically gets worse. but we're getting pretty close

again, just the downside we've seen in some of the mega caps. mike, as you know, here is a great example of what the problem is in the indices and it is working on the way up and now down the top 10 stocks, by capitalization and the s&p 500 are 30% of the market cap of the index. they have an outsized impact in what is happening in the index and when you take them down 5%, 6%, it is going to have an impact. >> so does that mean you'd be a buyer of tech if you think the market will recover this year. >> so if you think the fed is not -- right now as you know, sara, first half, i'm not seeing any reason to jump in on the next tick. i know that is kind of a popular thing trending there but if you think that the fed is not going to have to tighten as much as the market thinks and if you think the noble economy is going to slow further, you are at some point going to be looking to predictable growth and in that transition that

portfolio managers have, banks were the favorite place until the beginning of the year and now they've gotten hit and now you have bank stocks down 30%. so when you do finally rally, i think it is going be a broader rally and should include tech given how decimated some of the names are. >> that is true. tech was kind of defensive for a while there on the way up. we'll if it regains that tony, good to talk to you. >> good to see you. airline stocks seeing a major sell-off today and the jets etf has now sunk more than 20% in just a week up next, we'll break down what is behind the big moves and ask if analysts are betting on relief for the struggling sector and don't miss prime time series no retreat, business bootcamp premiering tomorrow. that is on tuesday march 8th at 10:00 p.m. eastern time on cnbc. "closing bell" will be right back

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you've got to go back to 2014, that is the last time that we saw jet fuel prices at this level. so we are seeing a dramatic increase in costs for the airlines remember, that is the biggest expense outside of labor and as a result, you've got 52-week lows for american, delta, southwest, united, they're not as low as they were when the pandemic first hit but they're moving lower and lower and getting closer to that point. by the way, it is not just the big guy wloz are suffering it is all airlines look at alaska, jet blue and spirit, they're all feeling the impact as well bottom line is this, the airlines can try, try to make up some of this by raising airfares but they're not going to make up the increase in jet fuel don't be surprised if we see modifications, revisions to q1 and q2 guidance coming up in the next couple of weeks before we get the q1 results in april. >> saw it in t s