average on the s&p, we could go back and visit the lows of this year, another 2 1/2% down. i don't think that we get down 10%. >> thanks a lot. you can tell we're getting close to the end of the show nine seconds thank you, liz young we have improved, we're not down triple digits on the dow, and you want to know what that means, make sure you join us tomorrow "squawk on the street" is next. good monday morning, and welcome to "squawk on the street," i'm sara eisen with jim cramer carl has the morning off david is on assignment take a look at futures as we begin a new week of trading off an ugly week last week we have cut our losses still looks like down triple digits, down 101 on the dow. s&p futures down 16. we were down about 300 earlier in the morning we'll begin with the markets under pressure as concerns about

inflation, and fed rate heights remain front and have, the dow had the worst one-day performance since october 2020, falling 2.8%, a thousand points there into the close, jim, all about the fed, and this morning, we've got new worries about china's lockdown, expanding to beijing, the heart of the country after some magss testing and shanghai has been shut down for nearly a month >> thank you important day, too >> yes, i think that we have to recognize that there are self-inflicted issues. when i look at the fact that china could have gotten the b biontech, and didn't build out the infrastructure to do it, thank you dr. scott gottlieb for helping me there, i wonder, what do they want, i hate to be too graphic, a stephen king's, the stand, where you can't control something. like that, your vaccine doesn't work it doesn't matter.

i'm more concerned with ukraine/russia right now, only because we haven't built in the declines in earnings per share that we're going to get from europe, and then your excellent interview, which tells me that we have much in store that's negative, except for the financials of which nobody wants to touch the analysts are flat footed here. >> capital markets out weigh higher rates on financials. >> true. but everybody could slow things. all right, so the fed could say, you know what, i don't want this, by the way, i want the fed to do 75, 75, 100. they got a win. >> they're not going to do 75. >> i know. but that doesn't matter. i'm telling you what i want. >> why do you want that? they don't want to shock anything you want them to shock >> i think the system needs a shock in the same way it needed a shock downward when we realized that covid was spreading. the reason i say that is because the ceos i speak to, they can't take it anymore. they can't take endless price

increases and think that they can do that. now, two quarters ago it was like, hey, i've got a product, and i can do a price increase, and i heard someone this morning say look, i want to own companies that can go through price increases. now, we're at the limit on a lot of different things. when i see what's happening in ukraine, and i realize, you know, putin is a madman, he is not quantifiable his soldiers are not doing well. the possibility of a stalemate there, and then a recognition that a path to crimea might be enough, so do that, you can say the chinese reverse direction, and the next thing we know, we come in, the only thing we're worried about is the fed, which i would say after listening to your interview, they're more in control than we thought. >> talked to the fed chjay powel she's got a single inflation mandate. inflation is obviously fight number one. >> right >> and they seem to realize they're behind the curve and

they've got to get on top of it. they don't want to crush the economy. i think when he says 50 basis points is on the table, it's more hawkish than before he's careful not to be too much. he talks about a tight labor market, inflation market i think they feel they can pull off a soft landing. >> they can do it. there's going to be a couple of bumps. i think the issue if you're jay powell, you must recognize what is being said by companies so you have brian moynahan saying the consumer is the strongest it's been. the consumer can take some pain, and not fall flat. companies are doing quite well they can handle the pain the people who can't handle the pain are the people at the retail level who are trying to swallow all of these different increases and you see that with the crunch take home depot a great company, and i use it as a metaphor, how many price increases can they

handle before people stop -- >> elasticity is the new buzz word. >> i want to be a little granular for a second. there's downgrades on treks today, and those are doing a deck at your house that is a beginning of what will happen which is that, you'll say, i'm going to hold off, it's too expensive. we're starting to get that it was a really interesting discussion about paint price increases, god love them that's task. how many more before we say, i'm putting the tio 2, the inside of white is too expensive let's go back to your interview, does jay powell know that things are so strong that we can take more than 50 >> i think so because he -- and his version of that is the labor market is very very strong people are getting jobs. historically strong, in fact, people are getting wage increases and i think he sees room there, and the consumer is in good shape, and the consumer balance sheets, i also get the

sense this is a fed that talks to business, that he is hearing. >> not a president, but a fed. >> not a president, not sure about a treasury but definitely a fed governor chair, i should say, who talks to business i think that the china, the china story presents a new risk because like, in a way like the ukraine story, it's a still stagflati stagflationary, and more potential issues for the supply chain. what does a powell do with that? they're buying bonds today. >> it's self-inflicted. >> china, yes. >> they don't have to do what they're doing. their hubris is extraordinary, and vaccine strategy. >> and their reports of -- they're fencing in apartment buildings in shanghai. >> this was a capitalist country that's gone back to communist dictatorship roots, and the fact that they don't seem to care

that they can save their people is rather extraordinary. the fact is we have areas of the economy where fundamentally things change during covid, truck drivers. a tremendous number of truck drivers retired. they were elderly. a tremendous number of people decided they didn't want to be truck drivers. plus, it's very difficult to learn how to be a truck driver, and you couldn't do it during covid. i find that until we get enough truck drivers over jb hunt, a great trucking company, we're going to continue to have this level of inflation here. again, these kinds of inflation are more of a mosaic in kchina, we could have another supply chain problem i don't want to go too far, and too deep in russia and china what happens if there is a resolution of she's saying, you know what, i'll go to biontech or somehow they get the pfizer

pill, i don't understand where the pfizer pill is, and russia, blinken is there. >> surprise visit. >> right surprise visit, and doesn't fear rockets. is he a fool or making a statement. >> making a statement. boris johnson was there. i don't know, if the u.s. government told me it was safe to go there. >> what does the u.s. government know >> blinken is there. >> if put wrin is such a crazy n why didn't he attempt to kill me the answer is he's not so crazy. leave everything on the table when it comes to russia. there's fighting in areas, putin is a great historian, and where they're fighting is in the areas that they had the worst defeat against the nazis, and he remembers this like it's yesterday. these are things he thinks about. i'm not saying he's -- he's more

than he is stalin, but he didn't attempt to blow up kyiv when he had a shot i'm positing these because we can get very negative right now. what happens if one of these three things gets -- what if it's turned and the sheet aluminum is now in abundance. >> sentiment should shift quickly. but how can you know what the end game is? >> be you can't vote against the end game if you decide, it's so easy to leave right now, but we will come in on monday, next monday, and hear that warren buffet bought deere or bought caterpillar and say to ourselves, did we miss the once in a lifetime, so i think you have to as a strategy for people at home, uyou have to find a stock that you never could believe has come down so far. >> are those some of the faang stocks we're going to get a lot of

earnings we're in a fed quiet period, and these stocks a lot of them, tom lee said a lot are looking at value stocks, he's looking at meta. >> it's very interesting, nobody expects a good quarter what happens if mark zuckerberg says i solved the reels, and they will be ready in fourth quarter in tiktok. now, i know that zuckerberg is working on these things. >> doesn't seem to like it negative cover. >> are they on facebook too like i am. >> good for them, i didn't know, i didn't bump into them. >> when you look at alphabet, they have a nice situation people are saying their ads have weakened those of us who use their ads know the roi is extremely good if you bother to listen the day elon musk decided to ruin the exclusive, you heard there's absolutely no way amazon isn't doing well, so i don't know, and netflix is still hanging over

us, isn't it. >> maybe replace the n in faang with nvidia. >> i backed away from faang entirely nvidia is difficult. >> i was asking your permission to change it. >> it is difficult you've got gaming, which activision blizzard is a disaster people are tagging that as crypto remember, they only make crypto cards from the those that fail to measure up to high performance computing. >> it's not like it got a big bet on mining. >> only using gt throw aways you don't know where the bottom is but you know what, again, i find these situations where when they're in free fall, attractive most of the time they're not in free fall. >> look what they have done this month, nvidia down 30% netflix, we know what happened there. any read throughs from netflix to the other big names this week. >> warner is tough >> should be interesting

cnn plus debacle. >> that's become a part of the game of what happened, and who knows. i find it boring let's talk about the things you have been seeing let's talk about lulu last week. lulu was extroaordinary, why. >> i saw your interview with calvin mcdonald. >> did you not think he was totally under control in the situation? >> absolutely. and the market reaction that day, it sold off, why. those were aggressive long-term targets and they didn't incorporate the net benefits like new product categories around yoga and sneakers. >> let's flip that maybe it's just sold off man has a five-year plan we saw what the plan is. it's extraordinary others are in the category you put lulu in your shopping list it should not have gone down and we look back, and say i remember that one day, lulu was a down a lot

did they like it >> you're about the up side risks today. that's what i'm taking out of every topic with you they're playing the music which means i have to go >> that's a different hour this hour we listen to the music, and it's just enjoyable they play beethoven if you stick around, the 6th. >> not what the producer is saying. when we come back, a closer look at what the driving coca-cola's better than expected earnings, we've got an exclusive interview with james quincy at 10:00 a.m. on "squawk on the street," and twitter and some reports that the board is considering this offer from elon musk might happen today take a look at futures i know you have a lot to say there. dow futures down 117 they have definitely improved considering some of the losses of 5, 6% in china on fears of a broader lockdown in beijing. s&p 500 futures down 17. more "squawk on the street" when we come right back

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twitter shares up sharply again in the premarket, almost 5% sources telling reuters that the companies is nearing an agreement to sell itself to elon musk for 54.20 in cash that was his offer best and final, he said, and the twitter announced the $43 billion deal later today, once its board has met to recommend the transaction to shareholderings. the deal collapses at any minute what a reversal from the board where are you on this deal this is more than $70 last year. >> what a reversal from facebook

and pinterest, and snap. you go over the snap quarter, which i thought was good, and it didn't matter. now you're saying, okay, 30, goes to 30 i don't want to be responsible for that. i'm willing to accept the fact that maybe i can't get an additional dollar if i were elon musk, listen, now it's 50. so i think they almost have to now, the one thing is they report this week i do not expect a good quarter, so what do you want to do? do you want to be hung, bad quarter, walk away, 28. >> but they could easily come back and say this stock price was sharply higher last year yes, it's a premium to where it's been this year, before elon started buying the end of january, and yes, he's got financing which appears to be a key development in this consideration. but the stock price has been higher before. you think elliot likes 54-20. >> they happen to have a very good board, and there is no road back to 70 there isn't because there was

hyper enthusiasm for everything at that moment, and these guys could disappoint on several metrics. i think that -- i'd like to know musk's plan over the weekend, but i bet you it's better than current management, which by the way -- >> we know a little bit. he's all for free speech one big question is does he let the tweeter and chief, donald trump back on twitter, people want to know, and he wants to get rid of all the bots. those are two big ideas. >> he's got three points over the current ceo who has not announced a plan i think the current ceo got a bad plan job in november. hasn't been able to articulate a position i would say that the people who use twitter regard themselves as owners of twitter, and the board uniquely seems to be a board that would be better for a tool and dye company. not one of them tweets so they didn't know the experience musk is personal, and doesn't answer people, but these are people, if you look at this

board, it's a really good board. i don't think they would know the difference between a heart and a block. >> a heart from a like, a like from a block. >> brett taylor who's the co-ceo of salesforce, he's a process guy, and also a nice person. i don't mean that in a negative way. a process guy who's probably open to elon musk. ned seigle is doing a terrific job as ceo, but at the same time, where is the money being made on twitter, where are the margins, we just go down, down, down. >> and user growth they haven't managed to get that up hereto. >> they have not been able capitalize on commerce i think a musk -- won't matter musk is not going to get to 70 he's going to have a terminal value. i think they really, if you're talking about liability as a board member you want to be liable for that stock going back to 30, and i think the answer is i'll take 52

over 30. that will take 52 over some day being 70, he dumps the stock the moment he doesn't get it. >> and the market has pushed them in that direction as well twitter has gone up every day in friday's awful selloff thursday's nasdaq. >> man has a plan, right man has a plan. >> look, i think twitter, if you read his feed, he's like the way it was supposed to be. it's fun, it's engaging, maybe he'll ask you, maybe he won't. my twitter feed on the other hand remind message very much as if i were, let's just say, in some sort of concentration camp, which i don't have any desire to be in. >> there's a lot of negativity, it that what you're saying. >> no there's the lot of comments there are people who leave twitter all the time because twitter allows, remember, twitter wants engagement engagement means to be foul and angry. >> misogyny, that's what my

twitter account is. >> fortunately, that's the one thing they haven't attacked before. >> does it mean anything for tesla, is that bad >> he's like five people >> the hyper loop, who is that man. >> he doesn't like traffic wants to get rid of terrific and he likes free speech we'll see if we get a deal today. could be exciting. coming up, it's cramer's mad dash as we count you down to the opening bell take a look at futures here. we continue to recover we're under a hundred in terms of dow losses. you want to see more of ka p-- four weeks at a low. >> thursday to friday, where it happens. >> yep, it was a brutal few days >> s 5&p00 futures down 16 more "squawk on the street" when we come right back

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dow futures under a little pressure kicking off a busy earnings week with a very strong quarter, surprised analyst expectations with 18% organic revenue growth and a pretty upbeat outlook as well they did not take down the outlook despite cautious comments we'll talk to ceo james quincey of coca-cola exclusively in the next hour. the opening bell just a few minutes away

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just minutes away from the open, time for cramer's mad dash, you're looking at telecom. >> a lot of our viewers are involved with verizon or at&t. it's a very important piece today by goldman sachs downgrading verizon to mutual, basically saying the risk/reward

for at&t with a similar dividend is i would say much higher verizon had a so-so quarter. at&t is spending a lot of money, obviously they're free from the shackles of what they're doing with warner, so i look at this, i myself was very skeptical about verizon numbers i i expected more growth. >> what happened there >> what happened there, i would tell you poor execution, i don't think there was any one thing. at&t is a black box. people want to buy that. people are selling them, they're warner and buying this i think it's important to keep track of the fact that there's a 5.7% yield for at&t. i point that out that this is maybe a shift. people want to be in the loser and out of the winner because verizon just did not deliver vesburg surprisingly did not put up the growth he hinted it and it was disappointing.

>> the growth is not winning even one word about slippage in growth -- >> forget it. >> everybody is prada. >> what's winning has been defensive stocks if you look at what's worked so far this month, utilities, consumer staples, a little bit of health care, mike wilson, the chief u.s. strategist of morgan stanley argues that those stocks have become stretched now. there's nowhere else to rotate s&p is going to join in the bear market because of hat. >> i think the utilities are about to be scratched. people watch american electric power, the best run, and by far, by the way, in great position given the fact that the heartland is picking up a gigantic amount of industrial. that's the one to watch. it's moved up a great deal dominion secondarily such a good company. it was deserved. he took some heat, but i think

that that group -- let's talk about -- >> on a downgrade today. >> and i think that those, input costs people are afraid of and of course the actual what's in the box and then the trucks, and quadruple play against it. >> coca-cola, kimberly clark, all had good quarters. >> there's the opening bell, cnbc's realtime change it's kim ball acquisition corp., wsss financials, selling the 35th anniversary as a public company there, and as we look for the open, it looks like, jim, the only two sectors that are positive this morning, consumer staples is utilities and real estate, so those are the defensive sectors still work sglg . >> can we talk about kimberly for a second. >> 10% organic growth. their china numbers were good.

and you know, it was a refreshing surprise quarter. and a place to go. now, it's not a place to go if you're seeking excitement, but it's a place to go if you're seeking a yield. it's a good quarter. >> people are spending time at home, and spending money on household products they seem to be prioritizes household products, toilet paper, tissue, and premium brands they didn't see a trade down at all. >> if you're looking for a work from home, you could do worse than that. the sectors that i like are work from home, and i still like cyber security, and i think people are ignoring the fact that at any given moment, we can expect something horrible to happen crowd striking in palo alto are my fauvorites. >> they have sold off. >> by the way, there was a terrific note today recommending snowflakes. >> saw that, yeah. >> and you know, the thing that's so interesting about

snowflakes is they actually have real growth, but is real growth a curse. >> at what price, though, jim? >> if i look at door dash, people are trying to call door dash at five times sales i'll take 17 times earnings any day. >> frank, the data platform tank >> frank the tank is kind of a cinema reference. >> $250 price target there >> that's an example i think people want so much to find something that's growth that they can get behind and then you look at a door dash, and you say, well, tony is doing a terrific job five times sales go back to 2016. >> you like it you think this is the opportunity for stock. >> nothing that sells at five times sales. anything that sells as a multiple to earnings i believe you have to be in companies that make things or do stuff at a profit, return capital that are not expensive i'm asking for five things give them to me. >> is coca-cola one of those

that is leading staples, it's also leading the dow 18% of revenue growth is better than any analyst i saw preview the company. they're seeing higher volumes, and i think importantly, they did not lower the guide at all, given all of the factors that will affect them from currencies to consumer spending to the china lock downs, the q1 net numbers were negative to the inflation story and the fact that as quincy said, it's well beyond just commodities, corn syrup prices have shot through the roof there's also transportation and low logistics and general expenses. >> yes, but he did talk about the idea of more can she when you have -- think about what goes into coca-cola i would say transport is more than anything. this was the first time i heard a ceo saying that some of the companies are reacting to the strength some of the plastic companies are trying to figure out how they should build more plants.

the companies that make cans are finally recognizing they've got pricing power and should do their thing. k coca-cola did well in 2000 you go to the ril period, we're taking that strategy >> already up 13% this year. >> look at j&j for a second. that quarter was pristine, and yet the stock fell is that right? aaa balance sheet, good yield, breaking into 3. finally get the medical tech doing well, and that day, people didn't care. that day, people didn't care and are going to look back and say that's my last chance, j&j it's an elite group. >> what other opportunities, you seem to agree that the reactions are not indicative necessarily of what should be happening? >> you know, you got to -- look, i took home stocks this weekend to look at, and look at the rails. it's the time for the rails,

but, you know, people are focused on the fact that csx couldn't find people. >> they're not necessarily sickly call, as much as a take away from trucks, and environmental csg. it's a classic example of who cares. what is china doing, going cold. europe is going to have to go coal, and we have a lot of oal >> serving us up >> i mentioned again, i don't want to cherry pick, i am saying that there are situations, i worked with stephanie for a long time it's silly season unless you sit down like she does and i do, and recognize when we go through certain companies, they're doing quite well, and if you got any sort of price relief, they would do even better what do you think of the home builders >> they have been slammed obviously. target number one from the fed is housing it's so hot. they raise interest rates. you see it in the mortgage

rates, above 5%, and the thinking there is that housing will slow. >> it will >> the question is have the home bidders priced in too much we have supply issues, right >> i'm not recommending toll brothers i'm looking at the compression, and a lot of the price targets coming in are compression, and people want to pay at what point will they pay four times earnings, when lenar cuts numbers big. the numbers must be cut first. >> i do wonder, though, we've got pce inflation. that's the preferred number on friday, and i do wonder if we are near a peak and powell would not say that we have to plan as if we are we may have peaked if we get a peak and inflation. >> what have we peaked. >> i'm saying we need, is it used cars, didn't get that last week we're not enough, i thought, remember, a lot of these numbers are down 30% from a ridiculous high we need to see used cars down,

lumber down. paint, well, i mean, used cars may be a little, but we need to see more than anything else until the world, semiconductor, and semiconductors continue to be the bottleneck, and we're not building semifactories >> no, that will take years. >> $40 billion in capex. we have to see more peaks. >> you're not convinced because a lots of people think that goldman sachs chief equity writer writing about how tech could start to work if the fed engineers a soft landing because of slower growth, not a recession, and if we're starting to see peak numbers around inflation. >> find myself agreeing with costen he's imempirical. most people are anecdotal. at a certain point we want growth again we have to have growth when price targets are cut and many people have given up have many people really given up, sarah, i think people are

clinging >> i think the sentiment is negative you're right it doesn't feel like capitulation what do we need to see to see that the price targets cut. >> we need to see people come in s and say, i can't take it anymore. door dash to a sell, and i don't care about faang, i think they're a disaster, they're not. >> they're all reporting >> i'll tell you what else i'm looking at, new autos. mary barton, new product lineup. jim farley, new product lineup will people care more about the product lineup or the $2.5 billion hit that ford has to take when it comes to commodities. >> we've erased a lot of gains around the hype around product lineup they're also cyclical and respond to higher rates. >> let's wactch. i'm looking at pfizer, bristol

myers, and i think a pretty good quarter and things that can buck this trend, and i also need oil to be down now, eventually the oil stocks, because a lot of them are offering a dividend that's variable. >> hello, 100 today on wti. >> 90. >> 5 1/2%. >> you need 90 it's on china. not for good reasons. >> 10% decline from the last month. when does xi come to his senses? >> even if he does, it's not like a quick fix even if they start to roll out mass vaccinations, right, we learned it's hard to avoid getting this thing >> i don't know, when you're a communist dictatorship and have the 8th army building bridges overnight, i think they can figure it out. >> there's now mass testing in beijing, and they're worried that the lockdown is expanding >> i have news for them, the two lines are red. i keep waiting for them to adopt -- >> we've all been there. >> i keep waiting for them to adopt something that we've done

right. but they're, again, self-inflicted and russia is self-inflicted russia is the wild card. i don't want to ever ignore it. >> i will say on the inflation theme, all commodities are lower on the china theme from zinc, oil, aluminum, iron ore. >> does jay powell say maybe it will go my way or does jay powell say i have to take it where it has to go. >> he has to take it where it has to go because it's so expansive. on friday, she was the last fed speaker to talk with the quiet period, you're not going to hear about fed speakers this week she said we don't need 75 because we haven't done 50 we can do multiple 50 which is more steady and see how the economy and the market react they're data dependent a lot of people are drawing '94 comparison actually in '94 after a lot of

negative sentiment when alan greenspan got really hawkish, summer turned out to be good, a big reprieve. >> absolutely. that was a market, you had a great fall and a not great fall, great autumn, better and i want that, but remember, they were 50/50/75 the 75 was in a movie, you're watching and the bad guy gets up one more time. >> they didn't have forward guidance, and they didn't have an inflation problem like this. >> i don't know. i'm reluctant to say this time is different >> if we did get 75, for which bullard has sort of put out there, i don't think it was his base case. he he was asked about it. >> we don't want to sit here and have water dripping. we need it done. okay we need the mortgage rates go to 5.5 and people are having the 27 best and final >> i'm saying, we need people to say i got my lock in

i'm not, you know, i got my mortgage so therefore i'm buying a house. that's what people do, get their mortgage to buy a house. you need people to say i'm not getting a mortgage and not buying a house this work from home has created two home situation so people feel like they have to have a second home who are wealthy enough, and then you have brian moynahan's number, people had a couple thousand dollars, now they have 10,000, that they can live on. we have ways to live in this country for a person who doesn't make a fortune i look at this market today, and i don't want people to buy this nondip you have to recognize that it's 942, we have tremendous margin pressure because people, they're still enough idiots, people who are stupid who are on margin >> i know that final hour at 3:00, we have been all over the map. we are selling off, and 3/4 of a

percent on the s&p . >> what do you think of retail here >> retail is, it's winners and losers i think it depends from the analysts i talked to, it depends when it comes to rising rates in retail, where you are on the income spectrum. if you're catering to the lower income consumer, a dollar store, a 5 below, those have been bett better, right? >> people love to trade down it makes sense. >> we need to see macy's up. >> that's the middle that's harder. kohl's, gap, look at what happened with gap. >> we have the middle class in the country. they're destroying the middle class in china who knows what's happening we want to see home depot stop at 290 we don't want to see home depot continue to cascade, home depot, will you look at that, my watch list. >> this is your watch list. >> yeah, that's my watch list. >> what about deere? got a bank of america, took it down they said earnings have not

peaked >> i'll take the other side of that trade >> fertilizer, saw some pressure there. >> manna from heaven. >> heard back from 40 dealers and less than 40% plan to order more equipment this year, versus 57% a year ago that was sort of surprising to them. >> all i can say is the farmers are a protected class, anytime you have a decline in inventory, they increased inventory i think ag co told a fabulous story. 13% of the calories in the world come from grain. there is a soybean -- there's a real problem with soybeans in brazil i don't want to get rid of this ag trade >> stick with it because of now structural problems. >> people are saying -- >> and the fed can't do anything about that. >> wheat and corn are too high, i'm not going to eat they don't go for familne

>> it's a disaster, at the imf's meeting, a lot of emerging markets in low income countries that don't produce these commodities, it's trouble. and imf is warning of unrest because in other times we have seen commodities scale these heights, that's what happens. >> famine, that's been the source of stress in history. very good numbers when it comes do dow that's a russian issue and farm equipment i'm building a positive case for ag if you leave ag right now, i think you're leaving one of the great secular growth spurts. >> fertilizer stocks, they've grown well that's a russia/ukraine story. >> they open one more plant it l plummets we need one more plant plastic, one more plant steel, look, i think you have to watch new

core, the best steal company in the world. -- steel company in the world. >> we are following asia and europe let's get to bob mpisani on the floor. briefly, consumer staples were in positive territory, coke up about 2% that was helping the dow but not anymore. semiconductor, etf, not that far from 52-week lows. it is interesting to watch energy weaken in the last three or four days there's the xop, the oil and gas exploration production, and even jets, which is essentially the airline business which had a terrific rally last month down in the last four days. let's me show you the production stocks, all lower. two things going on. you've got the covid restrictions in china which are definitely impacting estimates of global oil and gas demand, and we're going to see some

problems there and of course secondly you've got concerns about a slow down in general being induced by the federal serve. halliburton, these stocks were big leaders until about a week ago. same with the big material names, mosaic, freeport, i call them the big three of the material names freeport was $50.04 days ago we're talking 20% decline in freeport so one of two things is happening or both. they too are pricing in a slow down from demand from china or slow down in demand induced by the federal reserve. one of those two things or probably both hitting this sector as for earnings, the big story this week is going to be apple and microsoft. we need them to have decent numbers. it's been a very very tough time here, and microsoft frankly has not been a gratueat performer. people think it's been holding up well, but it's 20, 25% off

its high nvidia, 45% off. amd and ameazon, notable declines the only reason we don't complain about them, compared to the secondary names, the kathy, mega cap, what we call quality mega cap, the apple and nvidia are doing much better. st still, these are remarkable declines today, arc briefly opened positive you see that round trip. we bottomed back in early part of march rallied and then completely came back down. we're essentially sitting again right here near two-year lows here the loyal crowd, she has not lost any of her shares outstanding. that's remarkable. 45, 50% decline in one year, and yet the people who hold the fund of not selling the shares out. that's rather remarkable very intense loyal base still, meantime, the big discussion at the etf conference a week and a

half ago was bond alternatives the rias are panicking over the fact that they have 60/40 stock bond portfolios, and their investors are clamoring for alternatives we are seeing significant inflows in the etfs covering like covered calls, for example, getting inflows. preferred stocks getting inflows, master limited partnerships, despite the significant issues around t taxation are getting significant inflows. and sarah was mentioning defensive stocks the big star in the etf universe is a very obscure little etf that invesco runs, called the high dividend, low volatility, s ph. ph.d. -- sphd, but sarah, you were talking about t, this is stuff like altria, phillip morris, stuff that johnson &

johnson, for example, quality stuff that pays consistent dividend but not a big economic grower over all. back to you. >> that's what investors want, low growth, high dividends, lots of cash. bob, thank you get ininverting club with john sign up at cnbc.com/jointheclub. before we head to break, we want to hit the bond report treasuries, there is buying for a change with fields a little bit lower down below 280 on the ten-year that's interesting, it's given support to the stockmarket lately not the nasdaq they're worried about china growth >> we were above 280, they're scared >> under 280 we're panicking about growth it's always something. we'll be right back with "squawk in the street"

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. stocks are under pressure here in the early going. the hardest hit part of the market is energy there is a big look at the oil players. every stock in the energy sector is lower it's down 3.8% there are concerns about china's growth increasing lockdowns there on covid we'll be right back. you are watching "squawk in the street."

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>> they put up every single issue we have whether it be housing. execution is extraordinary let's give him that. >> that stock has really come down, 250. >> there's lots of opportunities, a 4% yield. 72 million shares goes to 60 million shares in five years >> outside risk. thank you jim. this was fun when we come back, exclusive interview with coca-cola chairman and ceo james quincy. they're on a downtrend we'll talk about the outlook struck a in the street will be right back

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the morning off. dana is on assignment. let's get a quick check on the market we see broad base selling and dow down 377 points and 1.1% the s&p down 53, 42.18 is the level there. the nasdaq back in or down in bare market territory, down more than 20% from its most recent record high. every s&p sector in the red. we are 30 minutes into the trading session. here are some of the big specific movers we are watching. we will start with twitter, rising on reports that they are close to dealing with elon musk. that's a day after the board met sunday to discuss musk's takeover bid we will have more on that later this hour. we see the shares up 4%. plus, energy stocks sliding. oil prices fall in fears of a global shutdown. chevron, conto phillips and marathon down over $100 a barrel we will have more on that with

jennifer granholm, u.s. energy secretary who will join us shortly. coca-cola rising on the top and bottom lines we have an earnings excludes whiff coke ceo james quinncy, those shares are trading higher. stocks are continuing to sell off, the s&p and nasdaq on pace for their sixth negative session in the last seven. joining us is david leb visit and charles schwab's susan saunders liz anne, i guess the question is, always, what's priced in and is it enough we have the market pricing in two-and-a-half percentage fed hike points, very much a look to sector leadership going on right here where does that leave us as the s&p tests the lows for the year? >> so i think, i suppose a soft

landing you could argue you is priced in. i don't think the session is priced in. i think what's maybe even more interesting than the latest market action was what was happening three weeks or so from the march 7th low in the s&p up until the march 29th high is leadership is decide well down the sector into negative signings cyclical industries underperformed even during that rally phase, it was accepting a message only reenforced by the move down more recently so soft landing, yes >> so, how narrow is that, you think the path is, to a soft landing that maybe the market is using as its premise right now >> i think fairly narrow, but keep in mind, the prior 13 rate hike cycles, we had ten

rece recessions, three soft landings. recession should always business a higher likelihood outcome especially now when you have a fed tightening into a slow economy up off the zero bounce, simultaneously trying to shrink the balance sheet with inflation at a 40-year high and a pandemic dill i still going on and a war in europe. i'm not sewer if that moves the needle from one to the other, how it argues a soft landing we can see inflation roll over through some of its own force. the financial conditions tighten enough that it slows growth enough and the fed may be later in the year. it doesn't have to be as aggressive i think recession in the tightening cycle is always the more likely outcome. >> david, today it's all about china. if you look at what is weakest in the market, it's everything tied to a coin growth story slowdown from energy to commoditys to an apple or a tesla or even a microsoft.

so how do we add that risk into the equation with a global economy that's already slowing on sky-high inflation, tightening monetary policy, a war in ukraine >> so i want to latch on to something liz ann said when investors look around the environment, they don't like what they see, they see the slower growth in china, omicron in our back yard and a fed looking to raise rates aggressively so i think investors need to recognize they can't have all good things and slower growth to the point that was made earlier could actually help us thread this inflation needle and allow the fed to take their foot off the break later on this year these cross-currents are causing uncertainty. >> i'll start with you, david, gip all these uncertainties, how did the investor put their money to work right now? it in equities

somewhere else >> we still see the sell-off has created some opportunity, particularly in the more profitable parts of the growth complex. we're seeing interesting thing in value they have much more operating leverage than their growth year counterparts to us it's an approach to price to earnings growth more than anything else. >> liz anne, same to you. >> i would reiterate the value piece. i often emphasize when i talk about value or growth, it's more around the factors, lower case, in fact, in the last few months, value factors are ones outperforming in a sector like tech so you can put value glasses on to look for stocks and not limit yourself to those areas that happen to be housed in the value indexes. i think positive earnings revisions has been a very benefit official factor right now as we see that revision story become more constrained, that makes more valuable those

companies that have that positive revisions, strong free cash flow yields i think you have to look for certain characteristicings as opposed to making a particular sector or two. i think that will be fraught with much more volatility. >> david, you mentioned that the fed cannot sort of achieve the conditions by itself and by acknowledgement of the fed chair, by the way, i think in the last press conference, j. powell was pressed a couple times, you think the hikes will restrain inflation he said, no, they operate with a lack they're hoping to be going in the right direction as perhaps inflation kind of rolls on its own for statistical and other reasons i guess. the question is, is this a 2018-type scenario if you thought this was going to be 2018 going in, you are not proven wrong yet have you defensive leadership, long-term yields go up to 3% the fed continues to say we're on course to tighten

is is that what with awe are looking at is that a helpful metaphor here? >> i think it's a fair analogy to draw. i would goba to if the fed is as aggressive as they've wade out and throw caution to the wind with respect to the outlook for growth then i think the probability of recession next year begins to increase i think what we need to watch most closely going forward is the way the private sector involves here. one of the things by looking at our colleagues on the chase side of the business is actively evaluate the health of the consumer when we look at the savings and checking account balance, they were above the levels that prevailed prior to the pandemic. we think the consumer is able to weather these tighter financial conditions and inflation simultaneously could be moving in a more positive direction that's how we get to where the fed says, things are moving where we want. we won't have to be as aggressive as the calendar rolls

into 2023. >> let me ask you about the megacap tech stocks? we're going to give them say a 25% of the market cap of the s&p 500 in a fed quiet period. it will likely dictate direction. do you think valuations look good in some of these names, microsoft is off at 18, 19% for the year alphabet, too, way down there ahead of earnings? >> as you know, i don't cover individual companies, but valuations have come down quite a bit. but what i think has changed with not just the megacap techniques i call it the super seven, but they're techie in nature they're very narrative rightly so they were a monolith certainly during the lockdown period and the aftermath, the so-called stay-at-home stocks. you can invest as a group. i don't think you can look at them with a monolithic lens anymore. you are seeing that in a draw down action, which is a much

wider dispersion than we seen in the past there is more discernment on the part of investors. you see companies get punished disproportion natalie than those that beat earnings i don't think that environment of rider dispersion and more discernment. i don't think that's going to change i think that's new term era with stocks like that >> yeah, folks bracing for what that means for alphabet and apple. liz ann, thank you for your time nasdaq is down half a percent. twitter shares have growth on progress on elon musk's offer. julia boorstin joins us with the latest >> that's right, shares are up nearly 4% on reports that the company is nearing a deal with elon musk. a source close to the situation telling me the board did meet yesterday to discuss musk's offer now that he's secured $46

pi .5 in financing. a deal between the company and musk could be announced as soon as today as first reported by the "wall street journal." now, there are still plenty of unknowns twitter secures a go shop provision to allow them to solicit bids from potential buyers, once the deal is signed. it is unclear what the breakup fee would be if the deal then falls apart. though a deal is far from certain, the seriousness of these negotiations is a meaningful milestone, dan ives said the street will read this news today as the beginning the of the end for twitter with musk on a path to acquire the company unless a second bidder comes into the mix analysts are starting to look at potential implications for the rest of the social sector. new research writing in a note last night, quote, musk taking over twitter is also good for meta and alphabet in the sense

that twitter will become the target for public debates over social media we are waiting for more from the company, no comment yet this morning from twitter morgan >> all right we remain on watch it's a big week for twitter. we get earnings later this week. thank you. as we head to a quick break, here is a look at our roadmap the rest of the hour, including an interview with the energy 2nd on crude oil prices, the energy outlook and more >> it's the fastest set of fed hikes. is that still not enough to tackle inflation we will discuss. don't miss our exclusive interview coca-cola ceo, the stock down 350 a. lot more "squawk on the street" straight ahead. >>

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...hbo max... ...starz... ...and peacock. just say “watchathon” into your voice remote and get ready to watch! i love you! i love you! i love you all! . earnings story of the day. coca-cola beating wall street estimates. revenue climbing 18% for the quarter with strength across the product categories and geography. the stock is up. ceo james quincy joins us now. good to see you. >> good morning, great to be here, sarah. >> so the quarter looks strong on all fronts. and what may be the most surprising is that given some of the issues out there, like inflation and slowdowns, you've maintained guidance. why are you confident in the outlook given all these headwinds? >> well, we are very confident

in our outlook we are coming out of 2021 with good momentum we have a strategy working for us a plan working for us. i've demonstrated with a really good first quarter strong results on the top and bottom line. what we see in the downhill is a series of factors. some are headwinds, some potentially tail winds we see it as a more complex volatile outlook we got to manage through it. remember in the downhill the conflict in ukraine is going to net out of the numbers and so that was, that will be there in the downhill but we are confident, we got a plan we are focused on the control. we see a wider aperture, a potential of things coming at us we feel confident for the year. >> let's talk through some of that, on inflation, specifically, you feel it on commodities, on transportation, how much pricing power do you have a lot of the sales beat was driven by price. volumes rose as well, how much more room is there to raise prices in this kind of

environment for consumers? >> a couple of things. firstly, we are benefiting part live with the reopening to the economy and the way from home, a positive mixesque. there is a bit of a tail wind, in terms of pricing, our approach is simple we got to deal with the logistic increases, the wage increases. we will ultimately need to pass those cost. our philosophy is to earn the right to price to make the pricing palatable to the consumers around retailers so we invested our market, innovation, our execution, particularly in providing packaging options that provide a wide range of price points so people of all pockets can find their way. it's a multi-factor approach to earning our right to price >> in the u.s. for instance, the consumer has been strong do you see any resistance to some of these higher prices and basics is that coming >> you know, clearly, a lot of

people have been taking place i price in the u.s you look at the u.s. marketplace, foot and beverage inflation, broadly, is starting high this year it was high last year. actually, it's only been above 4%, twice, basically in the last 20 years last year in 2008, it's likely to be this year. there hat none been a big consumer pullback yet. some of the poor income groups are feeling the squeeze on the real income. as we look ahead, history would tell us it's unlikely this will last forever there will be elasticity in pricing. we are very much focused on doubling down on earning our right to price and making sure we have affordable packaging options for when the squeeze on real incomes does start to put pressure on the consumers. >> what about china? that is the worry dujour for the marks today. the numbers were down, started the quarter well we started to see the lockdowns. what are you experiencing from a production and consumer demand

standpoint in china? >> yeah, clearly, there is a change a lot we started very strongly in january with chinese new year. by the time we got to march, it was negative the quarter ended negative, strong lockdowns in shanghai in simple terms, it looks very much as though we're back in april 2020 in terms of consumerably a lack of ofness in a lot of channels and having complication with the supply chain. but the good news is, you know, we have learned a lot over the last couple years of managing our way through these lockdowns. so we don't expect to be as dramatic as it was perhaps in the early years, the early months of the pandemic but it is clearly going to impact the business as long as the pandemic continues out there in china and certainly that's the direction for the near term. >> what about the portfolio, james, you made a number of moves lately the body armour acquisition.

tell us what you are seeing in terms of consumer trends, why they're going as we do see mobility continue to rise here, travel's up. what times of preferences you are seeing and whether there are changes you are looking to make big ones in the portfolio? >> yeah, consumers are kind of going back to the categories that they were looking at or particularly the channels they were looking at pre-pandemic we are very excited about the body armour acquisition. it gives us a great portfolio with power rates, it really makes strong headway in the sports market. particularly in the u.s. i think the one thing to pull out has been the strength of brand coca-cola. coke classic, both growing strongly both driving retail sales here in the u.s so it's really a story of the browns people have loved for a long time, it's being made more relevant with the marketing and innovation, engaging with consumers. also the new categories, that's

why our straej very much is about a portfolio -- strategy very much is about a portfolio of the cold brands and complementing with newer innovative brands and categories and really that portfolio is really helping us drive forward. not just in terms of global shares and profit but gaining market share and gaeng resonance with consumers with retailers. >> one of those new category also that investors are interested in. it's relatively new for you is alcohol. you are going deeper there, lemonade, hard seltzer, fresca tell us what you are learning and how big this category will be for you >> yeah. we've expanded our experimentation. it's an industry we don't, we recognize there is a lot we don't know and we're taking a disciplined approach to learning how to compete, how to engage

with consumers and how to create value for reretailers. we have a hard seltzer here in mexico and u.s. and europe we had success with our lemonade in china, expanded to the philippines. we learned in u.s. is more spirits based. really all of this is about learning about how to compete in these categories and becoming clear about whether it's a big enough opportunity that we should mesh much more seriously in it. still very much in the experimentation phase. lots of good learnings, lots of anxiety. still very much learning and experimenting. >> finally james on that note of caution you gach us on the outlook. you said there are risks upside and downside, clearly the markets are nervous. are you seeing evidence anywhere you said the u.s. looks to be in good shape in europe, are you

seeing signs of a slowdown, what would it take to make you change that outlook and take it down? >> look, there are lots of things happening out there some countries are reopening and their economies are growing faster and some are slowing down you can look at the i don't have all forecast from the imf and any of the institutions brigg down estimates for global growth, driven by a whole series of practice. so clearly, the sum of all the parts is softer than where we were three months ago at the beginning of the-year-old and' we really do we will focus on is controlling the things we can control. the cold system has done well in good times but has also done well in tougher times. whichever of those two faces us in the coming months and years, the coke company is really well prepared we have a strategy, we are confident we are grow our way through it and live for our

shareholders >> it's 10% more than that total return this year, versus the i don't have all market, which is down thank you so much for taking the time today i appreciate the interview thank you. coca-cola, morgan. >> sarah, great stuff. after the break crude oil continuing to drop, down 10% over trading we'll just with u.s. energy secretary jennifer granholm. we are back in two minutes

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welcome back to "squawk in the street." oil prices sinking on more global lockdowns forcing semi chain challenges, slowing economic growth. here to discuss the impact of inflation. high prices at the pump and a lot more is u.s. energy secretary granholm great to have you on thanks for being with us. >> yep >> so we have seen wti crude drop back below $100 a barrel this morning but we're still in general when you look at energy price at incredibly elevated levels we've had a number of industry expert was said, the financial reserve, until penalties on drillers for unused federal

departments. they are not incentivizing more oil and gas production in this country. your response. >> oil and gas production is increasing it will be increasing through the end of this year, according to our energy information agency the increasing amount of oil and gas production will be about a million barrels per day. that's what the president has released through the strategic petroleum reserve and in conjunction with our allies around the world to try to make supply and demand stabilize a bit. that's one of the reasons why perhaps you are seeing some leveling off of prices as well there is no doubt that we have to replace this supply that has come off the market because of putin's invasion of ukraine. that has pulled a million to a million-and-a-half barrels off the mark so we got to figure out how to replace that of course, europe is also considering doing additional sanctions. that will increase the

volatility of that so, the administration's ultimate goal, of course, would be in the median and long term to continue to decarbonize our fossil fuel industry move to cleaner sources of energy but that, of course, is in the medium to long term the president is really focused on what people are feeling at the pump >> i definitely want to get into that medium to long-term game plan in terms of a possible boycott by russian oil, the smart sanction, how could this play out and how does the u.s. aid in support in that process? >> yeah, i middle eastern, obviously, the u.s. is and canada, we're both in a position of being able to say we will not accept any russian oil we will not finance this war europe is more difficult for them, because of their greater reliance upon it however, if they do decide to as to some form or van or gradient version of that, then there will be an impact no doubt, on oil prices, because

that will pull more supply off the market and some of that supply could be absorbed through other entities, china, obviously, reduced demand for other reasons. so we want to make sure that russia's war on ukraine is not financed by the fossil fuel purchases. however, we also understand that there will be an impact at home. let me just say, we are fortunate in this country to not have to send, not sending our young men and women to fight this war and so there will be some consequence here and i think people are willing to absorb some of that, but we want to make sure that we lessen the amount, particularly for middle class, lower income people, who really feel this pinch more than anybody. >> yeah, of course, natural gas is a key part of discussion as well will you green light more projects for your concern?

>> we increased, permitted another two facilities to be able to export to countries with whom we don't have a free straid trade agreement, which means europe the president said he wants to increase supply by the end of the the year to europe so that is happening we are right now producing every single molecule of natural gas that can be liquified, where there is a terminal is liquified and sent we have permitted a huge number of terminals and you know cubic feet of luck wid financial gas we are waiting author those terminals to be built so we are doing everything to help increase supply to our allies. ultimately, we want to move into the direction of clean fuels. >> secretary granholm. on that point, obviously the energy prices is causing this global nuclear power i know you have been supporting

or enhancing nuclear power part of that was within the build back better. but where can we go to from here in terms of actually increasing, if you think that makes sense, nuclear's contribution to the grid >> yeah, nuclear obviously provides clean dispatchable base load power zero carbon power. that's why we are very interest in helping our allies achieve that, for example, some of the countries in eastern europe are much more opened to having nuclear energy than say germany is and so we are working with them. we are entering into a memorandum of understanding. a memoranda of understanding, for example, to be able to export nuclear technology to them there are other countries that are also very interested and it's -- it goes beyond nuclear as well. that base load power that is not as reliant on russia, includes things like clean hydrogen or

you know making sure that we de-carbonize our existing fossil fuel sector with strategies associated with carbon capture and sequestration technology and, obviously, wind, solar and the batteries that would store wind and sol la make those clean dispatchable baseload power. so all of those technologies are things certainly the department of energy is working on. that bipartisan lou gives us the means to be able to spend on demonstration projects in the united states to prove out those technologies >> secretary granholm, thanks for joining us today >> thank you it's now time for a news update. frank collins has that for us. >> here's what's happening at this hour. russia says it has 56 ukrainian military facilities overnight. they say the russian attacks included a missile strike at a train station near the western city of lviv russia says a large fire erupted near the boarder with ukraine,

but the reports do not say what caused that fire top u.s. officials say russia is failing to reach its water goals in ukraine antony blinking met with president zelenskyy. the u.s. is saying russia has made minor advances in the western region of donbas bang here at home, dare devils above the desert attempted sky jumps. both pilots made it down to the ground safety. they are facing an faa investigation. they say they denied red bull to do that stunt. after the break, we will check in with ubs on mark volatility we are off the lows. down 200 or so we are back in just two minutes.

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welcome back about an hour into trading nasdaq is up half a percent. technology goes green ahead of some very key megacap tech earnings that kick off starting tomorrow after the bell. mike, you always do a weekend column that incapsulates the key questions investors are looking at in the market it's a brutal four weeks or so back-to-back for the dow what's next? >> most of the damage below the surface, worse than that and we've also priced in a lot, arguably, in terms of what the fed is going to do from here with realso at the year-to-date kind of support area for the s&p 500. the key things is does the fed want stocks to go low tore achieve its objective? i think it's a let legitimate question my take is it's not the prime objective. but they're not sad to see it go

down trading 18 times earnings and go down from there if you are not creating a dip location that's number one. two, do all old megacap leaders need to surrender? we seen them go down one by one, obviously meta in a dramatic way. netflix, alphabet held up. it's rolling apple is the one that's been really sticking closest to its highs. maybe the reaction to earnings will tell us that. you actually see bidding here in alphabet now yields are down, too. then, finally, are people too bearish based on their sentiment positioning or bearish because of the backdrop? i think that's subject to interpretation, but you are seeing historic low levels of professed bearish i don't think and that seems to be suj up what the market would love answered, if possible. >> all right that will kick us off with our next guest, mike joining us now on the cnbc news

lean, the u.s. director of operations, art, it's great after the you bash on the show given all the market action we have been seeing and discussing of late. let's start with the technic also and key levels that are you watching >> well, we're calling in the process of testing as mike alluded to, the inter-day lows for 2022, and they're down around 4210 in the s&p and 33.4 in the dow and we've gotten down near there. it's trying to bounce. if they roll over and violate those, then viewers need to look for two things, is there a trap door reaction? do they suddenly begin with the free fall if they broke those old levels number two, i would carefully

watch if that happens. underline if, if that happens what does the vix do because we are looking at an area here if you get a volatile sell-off on the watchout sell-off you are going to need a confirmation from the vix. it will have to spike up into the 30s to tell you, yeah, they're throwing the babyout with the bath water. so, keep your eye on those former lows for the year i think they will be critical to the rest of the day. >> we can probably make the argument the treasury market and fixed income is signaling. we can see a rollover like this inequity, given the incredible volatility in moves to the downside we saw within that market. how closely do equity investors need to continue to watch the bond market right now? >> well, it's changed its

relationship they needed to watch as it was inching higher him right now we're having a flight too safety that's why yields have all moved lower. so it's not going to be any tech-by-tech relationship for a while until we stabilize you see the flight to safety as people moving out of rich assets all over, some of that's in oil. particularly some of it's in bitcoin. so, you can see that between what's going on with this new covid outbreak in china, which is a serious concern, i don't know how serious the condition is, but it's a very serious concern and it may, in fact, cause them to delay the central committee meeting, which could have great implications, particularly if we start to have flood inflation and food shortages. there is a lot in the market to worry about here the most immediate thing is to keep your eye on those former

lows and see if you break them in the intermediate term, you've got to see how the rest of the world reangst, we have volatile markets all around the world and as my friend the astute josh brown points out, when the s&p gets below its ten-month average, it then tends to experience some of its more volatile days. some of the sharpest daily selloffs him some of the stock markets off. volatility becomes a major factor i think that's where we will be for the next week or to. >> art, it's sarah good to hear your voice. i am curious from your his historical perspective lots of people are trying to draw comparisons when alan greenspan turned hawkish and the bond mark had a terrible year.

i am wondering if you see comparisons or a playbook for investors for the rest of the year based on what we've seen so far, which we've seen 11 hiking cycles you have been through a lot of them. >> well, my gut feel is that while right now powell wants to sound like he's paul voelker and i think he feels i don't want to use the word guilt that's not the right way, feels some responsibility for having said that inflag was tans itory and now clearly, that doesn't appear to be the case so, therefore, he's got to be a little tough on rates. my concern, while the market and everybody else is looking at rate hikes, it's the balance sheet that i think will be most important and when they begin withdrawing some of that support and when they stop buying and they, in fact, start selling some assets. that can have a tremendous

effect on the market and it will not be quite as invisible as you see in changes in rates. so, we've got an interesting time coming up in front of us over the next three months but i think powell will sound like vogueer i think eventually when they see the damage they do to the economy, to think it through the balance sheet, then i think the fed will begin to back down again. >> all right it's always great to get your insights thank you for joining us >> thank you >> as the nasdaq trades ever so slightly higher. sarah. >> net tech leading us higher no ar change. a quick programing note. don't miss an interview with interactive brokers chairman, interactive brokers chairman, thomas at the you're a one-man stitchwork master. needs to go up a size.--g n dow is down 338. you need to hire.

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a quick programing note.

new covid cases in by a jepg have investors worried about the possibility of a broader shutdown in china an china stocks are feeling the pain. seema mody joins us with these severe moves. >> this to the first options volume and the large cap etf is double the 20-day average. worth noting off the worst levels of the day with ali baba trading lower, jd.com and pin duo duo turning green in the last minutes as they post the economic growth. jefferies is saying it could reduce china's gdp 'by 2.5 to 3% there are downside risks to earnings in gdp. part of that reflect a fresh one of year low with the

yu an bank of america has lowered its estimates the most for 3m and ge partly due to the cost inflation story. 3m specifically has a lot of products made out of plast igs, we is derived from oil the supply chain challenges will be top of mind the companies on how the lockdowns are affecting productivity, their plans to diversify their manufacturing foot print same thing for honey wl and caterpillar. take a look at the price action. it closed down 6.5% on friday. that was the worst day since november of 2020 down another 1% at this hour, ever earnings on thursday morgan. >> it will be a busy week. china, china, china. thank you. coming up next hour, on fact check, we will do a deep dive in the ongoing weakness this tech stocks check out the big effort laggers on the nasdaq 100 just since the

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welcome back to "squawk on the street," i'm dominic chu, stocks are mostly lower today. the interior sector the worst performer. the only green speck is the communications services sector, a recently embattled one within the materials trade overall, what we are seeing is weakness in a range of names that have been maybe key indicators, or even beneficiaries of that inflation trade. we talk about minors, like freeport mack, payton codings companies like pp&g, fertilizer manufacturers, fertilizing shortages have sent prices to record highs mosaic, cf industries, are now sinking though deeper both down double digits in april but holding onto bigger gains of over 60% and 30% respectively.

the fertilizer makers, all of those things have play now morgan while you're here in studio with me. >> that's right. >> i'm going to send it over there across the way from you. >> 50 feet away. >> exactly. >> during april, thanks dom chu. during april we're celebrating national literacy month. here's contributor anna valdez how sources of growth can empower ideas. >> my journey through financial literacy started when i arrived here, came from mexico city. i was born and raised there. i studied there. i realized coming into this fabulous country that there were possibilities of growing my business through, you know, access to capital from banks, all the way to vcs and all these sources of growth that could empower a fantastic idea that probably wouldn't have happened in another country that was my journey, from mexico

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the fastest set of interest rate hikes by the fed since the 1980s. but that still might not be enough to effectively combat inflation. steve liesman has more steve, do you think they need to price in more? >> they could. they're now -- let's go through what they're pricing and deny enormous amount of fed timing this year, including multiple 50 base point hikes and a policy rate by year end that seeks to actively restrain economic growth the problem is, there's a lot of uncertainty whether this will be sufficient to restrain inflation. bank of the west writing we think the -- estimated around 1.8% a bit from here if they're going to make significant headway in reducing inflationary prices

the fed sees it going to 190 by august 270 by december. or above the fed's neutral estimate then goes further with the market pricing in a peak, rate of 3.36 by november 2023 how do you get there you have 50 basis point rate hikes next three meetings priced in with some chance of a 75, though that is way down today. it was higher on friday. then you have 25 basis point hikes priced in over the last lee meetings, with some chance of a 50 in the numbers the expected rise in rates of 2.70 base points will be the fastest the fed has done goldman, though, saying in a report this weekend, it believes inflation can be brought under control without a recession but it has to go above that 3.30 rate in order to get there maybe as much as 50, morgan, or 100 additional basis points. morgan >> steve liesman, thank you. more news tied to elon musk, meantime spacex struck a deal with

hawaiian airlines providing warless internet services. the deal marks the first comes under another deal with private jet service jsx. spacex has been testing the service with delta as well starlink is spacex's network of 2,000 broadband satellites the service is expected to be free for passengers of hawaiian next year. that's going to do it for us here on sidewalk on the street check tech starts now. welcome to check tech. today, tech stocks already, the nasdaq on a three-week losing streak, down more than 20% from its november highs where's the bottom twitter reportedly nears a deal to sell itself to elon musk. the very latest on that developing story, and why twitter is trending. and later apple amazon microsoft set up for a