since this morning and those are pretty much near session highs and 3.1% we did hit for the ten-year treasury. that does it for the exchange, everybody, but stay right there because "power lunch" picks it up right now ♪ ♪ no. welcome to "power lunch "qwest i am courtney reagan in for tyler matheson the dow has been off 1200 points intraday and we are off that just slightly. the nasdaq down more than 5% the moves, dramatic. the route, deep, but there are places to hide and opportunities to buy select names on the pullback, from tech to retail to commodities our market experts will help make sense of the sell-off what a day to be here with you, kelly. >> welcome, courtney great to have you here hi, everybody. let's get's check of the markets where the dow is down 3% 3.6% drop for the s&p.

look at this 5.1% drop for the nasdaq we are down almost 666 a quick check of the worst dow performer shows apple down 5.6%. we're really seeing the pressure here and down 156 and nike which has been down one of the performers, salesforce.com down more than 7% now over to rates. that's where you see the upward pressure here. the ten-year note which had been quiet, what happened at 8:30 eastern time, we've got the productivity and unit labor costs and quarter on quarter, that's a huge increase and productivity down 7.5% it's a toxic combination and a stagflationary one if you want to call it that and yields spiking just below 3.1% is where we sit on the ten-year right now. our market reporters are tracking these moves and we have bob pisani at the nyse christina partsinevelos at the

nasdaq and bob let's start with you. >> he didn't repeal inflation concerns let's just take a look at the sectors that are moving down most with ark fund one of the big decliners. higher rates impact multiples and that impacts tech stocks consumer discretionaries and these are cyclical sectors and tech cyclical. energy doing better because that's an inflationary sector. oil prices have been moving up recently and take a look at why inflation has not gone away and look at what kelly has been telling you this morning important thing is productivity down, labor costs up and that's inflation. it's hard for the economy to move forward and productivity going down and you heard brian sullivan lower and the trend is up and that's inflation, too sustained inflation erodes profit margins and the market's starting to get concerned on

that issue and look at what the impact on multiples are. remember, if rates going up impact multiples and the high-multiple tech names and cyclicals also tend to get hurt because the market prices in a potential of a slower economy. nucor and honeywell equal today and you have consumer cyclical names dealing with potential cyclical names and put owe the down side. defensive stocks yes, health care and consumer staple stocks, general, kraft heinz, general mills holding up better here's the issue, the s&p is down 13% for the year. almost all of the decline in the s&p is because the multiple has contracted what's the multiple? it's the p-e ratio what are you willing to spend for a future stream of earnings estimates that are out there you see it's down 16% and that's why the earnings are down and earnings are up 2% and you add

this up and what you get here, courtney, is down 13%. the big worry is whether or not earnings estimates are really going to come down in the next couple of months and obviously, the market is worried that that indeed will happen courtney, back to you. >> it is a sign of the market which is focused on these major macro economic influences and the nasdaq being hit the hardest. down 5%. christina partsinevelos is at the nasdaq i'm noticing almost all these names are lower and even names we don't often talk about like the international names like mercado libre and duoduo >> it's having the worst day since june 2020, but for the second time in basically a week, the nasdaq composite went from 3% higher and then dropped 4%. it did so last thursday and friday as well as yesterday and today. so what, you may think it's actually pretty rare the

index jumps and falls 4% on consecutive days since 1980, maybe a few years before i was born it has happened only 12 other times, lucky 13 if today's drop holds and to go up and down like this twice in the span of a week on consecutive days and the last time that happened was during the peak of covid in march 2020 and back in november 2008, the heart of the financial crisis and no other time since 1908 and the company is responsible for the massive swing downward, usual, big tech, apple, alphabet, you can see on the screen and a sea of red and microsoft and apple giving up their gains yesterday. the biggest laggards and chinese e-commerce platform and pin duoduo is 12% lower and 11% on weaker guidance and match group down 9%. today's trigger, you had bob mention it and kelly mention it and its highest level since 2018

and that makes the high growth toishgs. the semiconductor etf down about -- almost 5% and holding on to weekly gains and some of the biggest chip movers. you have corvo ol q2 revenue guidance their children china lockdowns and nvidia, marvell technology and on semiconductor down 5% and with the talk about inflation and the pinched consumer, courtney, i know you this, online retail taking a major hit etsy down 16%. they talked about the consumer not having as much disposable income and etsy is on pace for its worst day since november 2020 j.d.com, down over 6% and on a positive note, booking holdings and charter communications in the green, guys. the nasdaq 100.

>> not a lot of places to lack in the market and it's a broad-based sell-off christina, thanks very much. christina partsinevelos. we're pretty much at the highest levels here. what do you make of it >> it's the one-two punch of stagflation. how do you define stagflation? one way is low productivity and high unit labor costs and exactly the data i know we keep stressing it and it does suggest stagflation. even though two-year note yields are up and they're up nowhere near as aggressively as the longer maturities and yesterday's high yield was 2.85% and we're over a dozen basis points below that and that is significant. let's look at the counterparts' two year known as the shots and it's closed at a fresh nine-year high yield down and this is what it looks like when central

bankers are dragging their feet and whether it's here with $47.5 billion of reduction yes, maybe everybody on the inside knew they were coming and they're not happy with the pace of any of this we all know it will be since 202018, november, but if you look at her cart going further back, 3.3 was the highest in 2019 and those two height places and that's your next big resistance being, i was anything, but cheery about their economy, a fresh low going back to november 2020 in favor of the dollar and finally, yes here's the there are index two weeks and you talked about a u-turn yesterday and the currency in the reserve of slower growth.

the problem is dollar denominated-debt cost a lot more to service kelly, back to you >> rick santelli our next guest says she's taking advantage of the volatility by adding low and trimming high with us is liz ann sonders, the chief investment strategist at charles schwab liz ann, good to have you here even what rick just pointed out these 1% moves in the dollar we see them with flat-outic panic and what's your overall reaction to investors >> your tease was not quite accurate that was in the con tkt of allows investors to do i think stepping out on a day like today is pretty trench rouse unless you're an incredibly nimble trader and i don't make recommendations from a trading perspective, but yeah. the dollar surged today. it took out the highs from 2015

and 2016, yields firmly above 3% as you've been touching on the horrific combo of weaker productivity and higher unit labor costs as much as powell tried to talk down the likelihood of resessions, i think the needle is firmly pointing more in that direction than on a soft landing and it was more of a countertrend rally and today is more within trend weakness that we're experiencing as the market just starts to discount something a little bit worse than a soft landing. >> so do i just move to the side line this is the peculiar thing you know, people feel more comfortable on the side line even though inflation is 8%. you can't stay on the side lines in that environment, can you >> if by sidelines, if the question is should investors just get out neither get out or get in are investing strategies all of that is is gambling on

moments in time. i don't know any successful investor that did it by get in, get out. it's a discipline process over time and it is also a function of what your own risk tolerance is if you have a high risk tolerance and you have a long-term time horizon ask start to live on the income associate today week and it gives you are an aa fod any the principle then there's no one answer to what investors should do here it depends on the investor >> i would love to get a reality check when it's possible on days like today if investors are looking up todd or taken action yesterday and then what changed?

yes. we got the productivity numbers and so perhaps that helped us change a tone. really, if the s&p 5 00 was at 4202 and we're now at 4141, we are not so far off from yesterday. is this really pointing to a resessions to some of your earlier comments here or are we washing out a little bit of what was overdone yesterday >> i think what happened in the lead-in to yesterday as well as yesterday may be best described as a bit of an advance sell on the rumor meaning of 75 basis point hike and then buy on the news of the reality of powell pushing back the setup in addition to that on yesterday was the sentiment has gotten really, really washed out and that represents that, a setup. even if it's not overly positive

news you can get the countertrend pop to the upside, but to your point, the fundamentals of the economy haven't really changed i think there was a lot of short covering that seemed to be apparent yesterday and now we're sort of reaping the other side of that with the weakness, but i do think that the sentiment environment which has been less discussed was also a setup for a rally day and quite frankly, having huge rallies within bear markets is actually quite common so to see the kind of akd that we saw yesterday is actually very much in keeping with the history of bear markets. >> as we figure out what investors should do here parting comments, i know it's not like you're a stock picker, but is it price level that would interest you fed sectors where people can hide out here. asset classes? >> i think quality is the name of the game and you get the

short term bifrt and low-call id trade and this is the time for equity investors to not take too much risk relative to strategical kagd, but stay focused on the characteristics of value i'm not talking about buy the value indexes, but make sure you're not paying and make sure you're looking for positive earnings revigdzs and the quality rapper may be the place of consistent leadership in the midst of the volatility of the sector upon independent. >> thank you. >> joining us right now is neil hennessy shes s she's not recommending buying opportunity, and some of our viewers perhaps can make the most of today and make a little bit of money

well, courtney, is right, buy quality and hang onto it and i don't want really care if it's bondses, if it's housing and reynolds and if it's the stock market or whatever if you buy quality you will be fine over time you look at the markets and it's down a thousand points and i think the whole idea is to sit back and take a deep breath and look at the reality of the situation because i'm looking at this shake and bake market you put it in a bag with the spices and shake it up they're being put in a ziplock bag, shook up and picked out every day. i don't know what changed in inflation from yesterday to today. i don't understand what powell's remarks yesterday changed to

today, but i would look at it like, if there's plenty of quality out there, but there's plenty of excuses. it could be inflation. it could be the supply chain and interest rates and it could be whatever, but they're excuses because in the strongest position has been in the depression, in my opinion, the consumer is back -- they're back at concerts and they're back at the stadiums and airlines are full and the gyms are full people have tons of money on the side lines to spend. so i'm not sure what the whole shake-up in here is except you had growth that was way overvalued and if you're going to spend ten times on the price to sales then you will get hurt when the price is over >> if you're going to pay a dollar for sales you're not going to get hurt. >> it's interesting to hear your thought on the consumer. when we've heard of

consumer-facing companies even in the last 12 hours and it seems like it all depends on the subcategory that you're serving from the consumer. things are not looking so good wayfair, etsy, ebay and crocs had good demand and even pennsylvania real estate trusts which owns a number of malls and traffic is up 10% year to date and the consume err is strong so you don't believe the consumer weakness or consumer worry is part of what's percolating in the surface with the worries about inflation. do they have enough money even if inflation is at 8%. >> the left time i was on cnbc i was talking about the consumer and how it would slow down the spending online and they wanted to touch, feel, try on something and that's essentially what's happening. the estimate out there, courtney, right now is the consumer is sitting on $2 trillion in cash that's a lot of consumer

spending that can go along the s&p 500 companies are sitting in cash and companies are very, very strong cash wise and when you loaded up against cash flow and it's one of the lowest in years upon years upon years so the economy is not in as bad shape as people think it is i'm looking at the ten-year government yielding 10% and the 30-year, it is yielding 3.2. who would be the idiot to buy a 30.2 for 30 years? it doesn't make any sense. so essentially what you will see is people go back to value, investors will buy companies that are cash flowing, paying dividends and have the reasonableness of growing, maybe not in the disruptive way that people want the companies to grow in some sectors, but continue to grow and raise the

dividends and that's where value will come back and we've seen it before, courtney in the late '90s the nasdaq in '99 was up 6%. everyone was on growth and if it had dotcom next to it you made money and 'o 2 came and the market was up 45% and value did not lose 45% value damn near broke even across the board. >> neil, it's kelly here chevron is almost 10% of your position amgen, dow inc., coke, merck, ibm, verizon are these all names that people can feel comfortable owning here and for how long the durations? >> let me put it this way, if one or two of those companies go broke in the next 12 months or 24 months we have a lot more trouble in the country than we do in the stock market and here are high-dividend paying companies and companies that are cash flowing what we tried to do is just buy value, look at it. today the market's down 1

thousand points and god knows where it's going to end up it could end up 400 points in the next hour and 40 mondays this is all over there's no rhyme or reason that's why i call it the shake and bake market. it's not making sense which is really good long term. >> all right >> neil, we will leave it there. never one to mince words great to have you on today. >> thanks, guys. i appreciate it. >> neil hennessy with the hennessy funds, persistently high inflation will bea tough one and our next guest says the odds of a soft landing, slim to none he's peter vara with bleakley advisory group i would imagine you would agree with a lot of what neil was saying even down to those kinds of stocks in what you would rightfully warn would be a tough market >> i agree with him that value will outperform growth, but he's saying that he doesn't know why we're selling off and to me, it's pretty obvious in that

we're entering the storm of the most aggressive monetary tightening in 40 years, and whether that is on the rate hike cycle that has been, i think, priced in from a rate perspective and also shrinking the balance sheet at almost 100 billion a month that will start soon and you combine the two and it should be no surprise that the market is trading the way it is because we've spent years being addicted to the low cost of capital and we're driving economic activity and raising multiples on stocks and credit spreads. >> peter what i find interesting whenever the discussions come up and whenever we hear comments from the fed chairman is obviously the idea of inflation. we're living this environment that we haven't lived in in 40 years and at least some amount of it does come from the supply side and the supply chain which just continues and in some cases it's compounding and the fed doesn't have tools to really address the supply side of

what's going on with inflation so is the actions that they're taking going to be enough to help temper inflation? >> well, i think it's both supply and demand. when you think about what the fed will do, and like you say, they focus on the demand side, but they focus the demand side on interest rate sensitive side like housing and autos home prices are up 20% year over year. >> and with respect to autos, no question there's been supply problem and no pun intended, pedal to the metal, on the side. when you think of the price of a car being at a record high at 40, 45,000 and the median income in this country is 50-ish thousand and the only way to afford that is through cheap money and the fed is very responsible for pushing down the pedal on the demand side and then also other goods that

people finance whether it's buy now, pay late where you go to best buy and you can finance something and they're done through easy money and they have their fingers crossed that the supply side could resolve themselves about being to where the upon ten -- no so my eye right now is on the november 2018 high we got to 324 and that's level i had in mind, it was 22.8% now versus the 2% that we are now. predictioning where the u.s. ten-year will go you also have to figure out where european bonds are going. the european ten-ier went up through 1% today and we saw what

happened with the bank of england taking a very soft approach to inflation and if europe will behave that way it will tighten and u.s. rates will follow. >> if you're right and we're going to 3.25 on the ten-year is that mean that stocks will continue to fall from here they seem to be so tightly correlated and we're seeing thooiz moves on the tern-year and the nasdaq is down 5%+ today. >> the still trading at 19 times earnings and that's downward in earnings expectation for this year >> so if we're not going to have a soft landing then it will fall as the year progresses and on a p-e multiple basis. >> give us actionable advice before we let you go

if investors are believing in your theory, what would you say to make a little money >> i'm still bullish on commodities because of the strained supply side so energy stocks, and i like the report earnings be bullish and i like, and that's where the growth will be looking out 10 to 20 years >> peter var vara appreciate it. bitcoin is down 9% today to 36,172, throwing in some questions about its roles in inflation hedge and it does tend to trade like a risk asset kate rooney is tracking the move lower. what are you hearing about this, kate >> very much trading like a risk asset. crypt on currencies are not immune from today's market sell-off

bitcoin is now below 37,000 just a day ago. it had pushed back to almost 40k after the fomc meeting and still tightly correlated to qqq and, and yesterday's bitcoin rally was also accompanied by a boost in speculation, so they saw a jump in open interest. that rose by 6%, reversing a week of straight declines in futures will have ups and they did see a spike and some of the smaller crypto currencies are down, but they are faring better than crypto. hit by the double wham they have investors moving out for profitable names that was down twrefrl% we're seeing it as a proxy

dispute despite getting a proxy from bitcoin that stock is down double digits at len% and microstrategy, as well, down more than 13% at this point and then the mining stocks you have marathon digital, block chain down double digits at this point, as well >> back to you guys. >> can i ask you quickly, you also cover shopify and that's another name that did report earnings and look at the acquisition of delivery for $2, there. >> it's consumer spending and you've seen it hit paypal as well today and things like a firm goingly, you have block or formerly square today. that stock is less exposed to e-commerce, but they bought after pay which is a big buy now, pay later name so things like after pay in the umbrella or square and investors have a

spending slowdown in the online shopping slowdown as we see. inflation and a lot of questions we see with the consumer and shop my was highlighting, and we have a very busy day and thank you very much for joining us >> our coverage of the sell-off does continue. the consumer collapse. discretionary stocks leading declines in the s&p. travel stocks, tanking, a decline lep ar, dfrment r. horon just off 9% and we just talked about it, names like etsy, wayfair and ebay lots more "power lunch" straight ahead.

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>> we have just 90 minutes left in the trading day and we of the to get you caught up on the market sell-off. let's check in with bob pisani at the new york stock exchange bob? >> we have been steady since about noon and steady on the down side and we are essentially hitting lows for the day and we've been going around on the bottom there down 165 points for the s&p 500 and consumer discretionary and technology and the cyclical sectors are among

the weakest groups and consumer staples in healthcare, defensive sectors holding up better. if you want to see what inflation is doing, just take a look at the new high list on the s&p 500 and this is a new high on an intra-day basis and it's all loyal and the philips 66, the refiners have been hitting new highs and deafon energy and occidental petroleum all hit new highs earlier in the day today tech is the real story to watch. the nasdaq composite 10,315, that was the low on friday, as i recall, the closing lows and we may violate that and hit a new low on the nasdaq today and if you wonder what people are trading, you want to watch the etf space and it is all leveraged and inverse plays on the nasdaq 100 there are the pro shares and ultra pro qqq and what's that? it's three times what you've got for the qqqs here. ultra pro, qqq, tqqq, and i know

it's hard to figure out here, but the bottom line is it's three times the nasdaq ultra pro short is three times the inverse of that, and then, of course, you get two times the inverse and the ultra one down there on the bottom qid and people are making tremendous leverage bets one way or another on the nasdaq 100 and that's really where the actions we're seeing incredible volume in these particular stocks right now. so a lot of speculation one way or another courtney, back to you. >> the moves there are incredible, as well on the etfs. let's move to the bond market where yields are at multi-year highs and we have 3.1% on the ten-year what else is going on? >> yes, we do. >> it's wild it's over a dozen basis points below its high yield yesterday whereas the ten-year has had several sessions trading above 12% and it's a safe bet to close

above 3% for the first time in 2018 and let us not forget and not only are there market logistics going on and anybody who bought the big pop yesterday probably selling and very nervous and we have non-farm payroll, and the big april jobs report tomorrow and jobs, jobs, jobs are important and there's nervousness in the market and let's look at the job and it's the steepest in three weeks. okay but let's look at the true spread that's supposed to give you a warning sign meaning less than for for recession a seven and a half year steep and if we recall, the december meeting for the fed is right basically in the middle of the month. december 13th and 14th so steve liesman has been using january fed funds and that's the 31 of the of january and february 1st and it's cleaner

and let's do a three-day of january fed funds and what's interesting here on tuesday they made their low-yield the low price close and 97.115 it's only moved up a bit and as you see it now it's 97.16+ it's still implying 325 basis points of tightening and no matter what the fed does the marks, the referee behind the scenes for days like today courtney, back to you. >> nervousness in the markets to put it lightly, rick thank you. >> a volatile session for oil which is closing toward day. pippa stephens is at the cnbc commodity desk what's the action? >> crude moving between gains and losses before ending the day here modestly higher and opec and its allies met today deciding to boost output by 432,000 barrels per day, although i should note that it's been consistently missing goals

and it also remains in focus let's check on prices and a third of 1% at 108.22. brent rising two-thirds of 1% and nat gas continues to be the story here, surging 4.4% to $8.78, per btu, hitting the high today since august 2008. the contact now up 21% this week ubs noting that usually demand destruction would come from utilities swapping gas for coal, but there's no coal available and coal prices are also spiking. i also want to note, since we've been watching diesel, they've hit retail prices for the second straight day >> very active in the conference for more on how to play the rise in energy, paul sankey with sankey research. you say this is potentially the most interesting market you've seen in 30 years what do you mean by that

>> it is the most profitable for oil and gas and refining companies and it's a multi-facetted and you mentioned coal that's also raging and what we're getting here is companies that are maintaining capital discipline and just making enormous free cash flow, and it is coming on. >> is it sustainable, paul it was fascinating to hear brent fill last hour he was talking about how clients don't want to hear how they want to go to energy. they want to go to consumer staples and that's quite a comeuppance on the best performing sector over the past decade >> it's obviously a huge change. is it sustainable? it becomes an economic question and we're not seeing the demand destruction and the price is trying to encourage more supply or less demand >> today opec announced an increased production target over the past month against a

$400,000 barrels to give you an idea of just the supply of the markets. it's entirely possible we like chesapeake and any of the oil companies, they've all had very good results this week especially when you combine refining and exxon and it's a remarkable environment we're discussing europe cutting off the import of russian oil. what does that mean, big picture. >> it's a huge deal. opec says too much oil in the second half and they're still including russia in the numbers which is absolutely staggering russia, as you know is a major natural gas and exporter and russia will get more and more fed through into markets it takes weeks and month, but ultimately, as you said, yesterday the eu announced they will block oil and gas from russia over the next year is a

very, very big deal and it's enormously important for american exporters of both the oil and natural gas. >> paul, when people come into the space now, should they be putting money, you mentioned the place you like in the part of and are there any stocks that you look overvalued, richly valued like the tourist investor might get burned >> well, we're talking about oil trying to get to 10% in the s&p and we're up 4% so there really isn't. i don't personally love the service companies and we're seeing such great capital discipline from the emp companies and the big oils and historically and the service companies to get their revenue is a multiplier of revenues for the emps and if they have the dollar through the door they would spend $1.20. they are now at a point where they're under 50% in many cases and even less if the cash flow is going on increment as well

and they don't have the people and the steel to add in terms of production so as a result the service companies are one area that are less favorable, the schlumbergers, and the halliburtons and the baker hughes >> what about the natural gas and pippa stevens pointed out that in some cases you see companies swapping out for coal and that's also moving higher in the price action can you make money off of that play, as well? >> yeah. as i mentioned, we love chesapeake and entero and formerly in canada are great plays because they are infrastructure constraint. so what we try to do is buy the names that don't have that problem and the name like chesapeake which is in the area of natural gas and they're at a btu and we're not seeing significant growth here from the

producers outside and chesapeake is a great play and there are several companies that have come through bankruptcy and there's a trailing concern about the company because it's been previously been bankrupt and the fact of the matter is they have very free cash flow back to shareholders and everything that the nasdaq doesn't offer you. >> paul, we'll leave it there. thank you so much. he mentions he thinks energy could be 10% of the s&p and that could be because of the shriveling of technology on that note let's turn to the equities where we are at session lows the dow is down off 1200 points, that is 3.5% the dow down 682 points and the s&p 500 down about 3.8% and at 41.36. let's turn to art hogan. he's the chief market strategist at national securities art, you know, the market just botto bottoming here in front of you and ten years, 30 years and the dollar flying.

what do you make of it >> it's hard to have any ril good context around what's been happening with marks and the multiple compression that we've seen started arguably last november and that's been an ongoing battle, specially with the growth names when you look at the month of april, take next week and the average move of the nasdaq 100 was in either direction and we're seeing that and now it's 3% and 5% today. this isn't normal activity, but what i will tell you is i think in the lead that you didn't bury and that's what the market is trying to do trying to find the appropriate levelto say we've done enough damage to equity valuations with the information that we have right now. what do we have right now. we know that the fed will have to be aggressive and likely raise rates by 50 basis points so take a look we know china has a lockdown and it's certainly supply chains and we don't think it will last forever and we know that on its own accords and they'll start

coming down. the numberses on april, may and june it started pulling down goods prices and if you look at the folks that reported this week and talk about the consumer and they're consuming fewer goods and more services and that's healthy for inflation. i think we're in that period where we'll have that volatility and we're closer to the bottom than we are to some top. >> that's interesting, art do you think this is the market's way of voting that they heard powell and understood yesterday's rally and generally don't believe that the fed can engineer a soft landing with all of the things going on and all of the things outside of the fed's control? >> right it's the thing outside of the fed's con terrell that are the hardest to try to calculate, right and triangulate. >> we have to tend the rate hike cycles and seven of those times we ended up in a recession .07% is not for the fed to be facing into this and it would be

fine from the places that we're coming from. i think what the fed has done a good job of is be transparent and they're not trying to shock this market, and i think what we have to start doing is finding out how the financial conditions react when we start shrinking that balance sheet starting in june and when we get up to the 95 billion a month and see what the reaction in the financial conditions look like and that tempers what it has to do on rate. >> talk to us about opportunities, art where do you see them? >> i will tell you this, i would tell you that the most oversold sector right now is technology i mean the technology that actually is strength and when you look at the top five names in the s&p 500, you have them in this low they have a great financial crisis and if you carry oversold i think the most over bought to a certain extent is energy and the equity complex has followed the commodity and it's never had drawdowns and if you look at

chevron and good stuff i don't think it gets the full 10% of the s&p 500 and if you're putting new money to work, i would wait and if you're looking at the most overbought and most oversold. >> people listen to paul and now they listen to you and they don't know what to think that's the market. art hogan with the nasdaq down almost 700 points. >> check out the consumer discretionary sector of the s&p. it's the worst performer today down 6% right now and this includes tech names, think, and it's down 22% this year. let's zoom in on a couple of areas of concern and home builder stocks for one with diana olick and that's another one, seema modi. that's another one let's start with you >> kelly, housing stocks are getting hit by a double wlhammy and the mortgage rates loosely follow that yield. so the average rate on the 30-year fixed hit 5.62% today

and that's a new cyclical high according to mortgage news daly and it fell slightly after fed chair powell made no surprising moves and backed off more aggressive rate hikes and still, take a look at the homebuilders. big names down 20% year to date and lennar, pulte and dr horton down 5% to 6% on the day and the retailers that have taken a beating way off today and interesting that the home depot and lows not as bad as the decorator names and they get more commercial business from the builders consumers are likely pulling back more due to inflation and i want to throw that in there and mortgage lenders and loan depot which have been getting crushed on mortgage rates are also down big time, kelly. >> didn't we all know that higher rates were coming and we all also expected to be a 50

basis point move powell just potentially took 75 basis points off the table at least as for as the fed is immediately thinking, why such an extreme move in the homebuilders today that are so closely tied to the mortgage market >> that's because we expected rates to move higher, but not as fast and we started at a record low rate and we didn't expect it to move this high. they follow the ten-year yield and i don't think anyone expected it to be this high at this point and also there's the pullout from the mortgage-backed bonds which is having an outsized effect on mortgage rates and we're much higher and we expected them to be not this high >> any relief there? they say we have servicing businesses. >> yeah, no, i don't see that coming i talked to an analyst who said it's looking kind of ugly ahead for these lenders and you have a lot of public names that are

trying to pivot out of refinancing. they're down 70% from a year ago and they're trying to shift and then you see the housing market slowing down thanks, diana, thank you for laying it out there very clearly. >> now let's move to travel stocks which are pulling back despite the outlook for a strong summer seema modi, a lot of moving parts in this sector >> what do you do when companies convey a bullish outlook and still, their stocks are getting punished and that's what we're seeing across most of travel today and let's take a look at airbnb and the outlook and sufshg hanna are citing valuation concerns and it's trading to 142 a share and down 9% on pace for its worst day

since february 23rd and marriott also reversing some of its gains from yesterday when ceo tony capuano joinedo us on cnbc to discuss marriott this morning we heard from royal caribbean saying it's turning cash flow positive in april, but did hint at a potential slowdown in europe this summer. that comes ahead of norwegian cruise lines' results next tuesday. booking holdings and trip adviser both out with solid results overnight and seeing a meaningful uptick in experiences and dining in the first quarter and so far these two names are holding on to games and booking holdings up 3.6% and trip adviser up over 4% at this hour. kelly? >> seema, it is so interesting here all of the action that we're seeing in the travel industry and i know that bank of america's card spending noted that spending was up 60% spending at event ticket agencies up 140%

some of these names are still getting punished because of the action in the broader market and an expectation of a slight slowdown with some segments. >> also the outlook we're getting from a number of these travel companies and i would also point out to the hotels, obviously when the financing costs for the future pipeline and right now what we are seeing is a slowdown in the construction of new hotels, so that's giving investors a little bit of pause, even though of course right now the demand, bookings right now, remain strong. >> all right, seema, thank you we appreciate it seema mody. let's shift gears back to tech, the worst performing sector with nasdaq down 5% names like apple, amazon, alphabet, microsoft. microsoft is down 4.5% amazon down 7% let's get out to steve with more on these moves. >> these were the stocks that people really liked to park their money in just a few months ago, and now we're seeing them just erase the gains they made

yesterday. let's start with apple down more than 5% right now. you might remember last week they reported this wbig warning because of the covid shutdowns in china, up to an $8 billion cost for them. microsoft down 4%, erasing their gains from yesterday and then some they warned in their earnings report last week it was all about azure and the stagnation in cloud growth which is something we're seeing across a lot of cloud companies, from gaming to cloud, you name it, that's really tough as they come out with tough pandemic comps. over on meta, even worse of this group that i'm talking about here it was down about 7% last i looked and we know they had a lot of headwinds ahead. we just got that report yesterday that they're doing a hiring freeze or slowdown as they deal with inflation and worry about the consumer and ad spending and finally alphabet, same story as what i told you about meta.

missed expectations last week on the youtube revenue front and just, again, concerns about consumer spending and inflation, the same story we keep hearing so big tech once the place to park your money and now look what's happening, a blood bath. >> it's not like small tech offers a lot more respite. a thought the comments last hour, talking about snowflake, which he likes fundamentally but is trading at a valuation so high if multiples keep compressing, you've got to be careful. >> it's the tech stocks, like the cloud companies we saw ipo during the pandemic, they're not growing at the same way they used to be and the comps from early in the pandemic just look horrible. >> i'm going to be curious about the mood in san francisco because this is starting to feel like dotcom. we may be closer to the end than the beginning, but as everyone remembers, it took many years for that eco-system to fully recover. >> yeah, that's right. we heard people who lived through it, we had bill gurley

on yesterday and he was talking about just this. these people lived through the hard times and know what it's like there's this theme going on throughout silicon valley that the newer people, people maybe my age and your age who don't remember living through that or at least being investors at that time, they're going to get a real reality check pretty soon here. >> thanks for putting me in that basket. >> we're the same age, i think it's about right. >> steve, thank you. well, online retail taking a big big brunt of the sell-off in tech some of the biggest laggards getting whacked post earnings. w wayfair sinking after active users dropping 20% year over year ebay and etsy dropping on weaker than expected guidance let's bring in scott nations, president of nations indexes scott, welcome let's just start with your take on wayfair this was a darling for some time during the pandemic. the ceo is suggesting that, yes,

consumers are still spending but they're starting to make more discerning purchases as they have a lot of things tugging at their purse strings, including inflation. is this temporary or a permanent downturn for a name like wayfair. >> for wayfair, they're really getting discerning and deciding not to buy from wayfair. this is going to be a tough time for wayfair going forward. you pointed they had a decrease in active users. the problem was the expectation was active users on wayfair would increase and now we've had four quarters in a row of decreases. they're also talking about energy costs are hurting, they're having a tough time with labor. so wayfair, which is down by about two-thirds from itsrecen high, is really going to have a tough time they're really in the crosshairs because nobody wants to go and buy a sofa right now we've done all that. we want to get out of the house. we don't want to buy furniture right now. wayfair will feel the pain.

>> it's interesting. the ceo says consumer spending is still climbing. shoppers are reprioritizing experiences like travel as we just discussed with seema mody let's move on to ebay. what do you make from their results? a lot of things to not love so much about this one. >> well, if you just look at the headline numbers, and there's plenty to love ebay just beat on revenue, they beat on eps but the guide appearance was absolutely horrible. >> right. >> they just killed the stock by guidance also i think that the strategy for ebay is more than a little bit of a mess. they're talking about auto parts, vault storage, volume there, users there has also declined so i think ebay -- all of the trouble ebay faces is of its own making again, the guidance going forward was just terrible. >> you know, we want to move on to etsy here really the cfo had some interesting comments in the release and talked about the

macro headwinds going forward and all of the different pressures, again, that consumers are facing but you actually are liking etsy here, even though this is the worst day that it's had since 2020, i believe? >> and etsy right now is the worst performer in the s&p that's partly because wayfair is not in the s&p wayfair is down even more. but i think etsy has the best franchise. people like it and it doesn't have the problem with big ticket purchases that wayfairdoes it certainly was a darling during the pandemic, went from 32 to 300 and back down to 90 now. but the strategy makes a lot of sense. they did have a sellers' strike because they tried to raise commissions. that caused some trouble but they beat eps. guidance was similarly horrible. they talked about the guidance that they gave for revenue was 10% below what the street had expected but the strategy makes sense, the franchise makes sense, and i think etsy, of all these names, has the most upside because they

really have a plan for growth. >> can we pivot, scott, from these names to the market more broadly. as you watch the price action this afternoon, what are you thinking >> i'm thinking that the fed waited way too long. there were a lot of really smart people saying that they had kept rates too low for too long and they were all no, no, no, no, no if so many people realize ed thy can't time the stock market, why do we believe the fed can time interest rates >> where does that leave the market >> it's going to be very choppy, very volatile and pretty sickening. but the worst thing that people can do, and i actually just published a book about this called "the anxious investor." the worst thing people can do is throw in the towel because they think there's going to be a bunch more downside. we saw that happen famously in february and march of 2009 so invest, continue to invest,

keep investing, don't throw in the towel and stop investing or the worst thing you can do is just dump your portfolio as an old trader, we would call it puking. don't puke your portfolio because you think it's going to continue to go down. the only thing you're doing is paying attention to what everybody else is doing and they're probably not any smarter than you are right now. >> that's somewhat reassuring. scott, thank you so much. >> thanks. >> scott nations. the gaming stocks have also been pulling back with caesars and penn national down about 6%. let's get out to contessa brewer for a check on these movers for us. >> yeah. can i pull up another stock that's really the laggard. draftkings just announced it has completed its acquisition of golden nugget online gaming. look at its stock, it's down more than 10% today. they were bringing in golden nugget because they need the igaming customers. they weren't getting them from the sports betting crossovers. earnings tomorrow, there's going

to be a lot of pressure on the ceo to explain and lay out the path to profitability. melko announced earnings today it had not a lot to say. at least ebitda is positive, unlike las vegas sands and mgm and yet look at what's happening with melko it's down 6%, las vegas sands down 5%, wynn off 5%, caesars down 6%. it had a pretty good earnings report when analysts liked you look at the las vegas strip and there's incredible room rates and occupy ancy levels bu just getting crushed with the markets. penn announced earnings today. its shares off 6% today. there was a lot to like there. their customer acquisition costs are far lower than many of its competitors, but right now the real questions about how

inflation will affect those gaming customers coming into play, kelly. >> absolutely. contessa, thank you very much. let's get a check on the markets now as we go it is the worst day for stocks of the year. rates continue to rise the 10-year back above 3%. >> i was hoping we could end on a positive note but i don't think it's happening today as we toss it over to our friends on "closing bell. thanks for watching "power lunch. world trade center. stocks are tanking giving back their post-powell gains and then some. nearly every name in the s&p 500 is in the red. the most important hour of trading starts now welcome to "closing bell." i'm sara eisen here's where we standing, another sharp sell-off on wall street we're down 1148 points lows of the low was down 1240 points, but it is ugly out there. every sector is sharply lower. consumer discretionary is getting hit the hardest, down 6% thanks to double-digit declines in names like