much going forward or maybe can see interest rates start to play less of a story. we'll see what happens. >> all right, dom, thank you very much. interesting insight there. julia, it's been great being with you the past couple of days congratulations on the disruptor 50 to you all, thank you very much for watching "power lunch. >> "closing bell" starts right now. thank you, julia and tyler stocks are rallying with the nasdaq in the lead the most important hour of trading starts now welcome, everyone, to "closing bell." i'm sara eisen take a look at where we standing in the market, up almost 400 points on the dow, s&p is up 1.75%. every sector is green right now except for consumer staples. you've got technology stocks leading and coming back today. financials are also doing quite well, materials, so it's a mix of the cyclical groups, beaten down grumsoups the 10-year note yield also going back up.

we've seen that stabilize lower. it's still below 3% but it is reversing the trend of the last few sessions check out some of the to performers on that nasdaq 100 leading the charge higher. amd, we'll talk about it, up 8%. a lot of the semiconductors and chinese internet names are what's leading us higher today you've also got a lot of the software names leading and some of the mega cap tech as well we'll talk more about the strength in chips in particular later in the show. straight ahead an interview with jack lew on inflation fears and whether or not he thinks the u.s. is heading toward a recession. let's get to our top story, though two retailers with two very different earnings reports what does it tell us about the market and consumers inflation and supply chain eating into walmart's results this morning, missing analysts' estimates, lowering guidance, sending the stock down sharply lower. it's down over 11% home depot is raising its full-year outlook on the back of

stronger unearnings what does it mean for investors? greg, you cover these names. what does it say about the consumer >> it says the consumer has a strong balance sheet but they are starting to make choices so particularly lower ending consumers are choosing what to keep in the basket and where they can save some money because they're the ones under the most pressure but middle and upper consumers and homeowners are willing to spending given the housing shortage that we have out there. >> jim, you like consumer discretionary. it's the hardest-hit sector of the market this year amid inflation concerns what do you make of these two reports and what that says about the group? >> well -- >> we did just add home depot -- >> that was for jim. greg, i'll get back. i just wanted to jim in here too. >> no problem, no problem.

i think it could well say something about inflation's disproportionate impact on lower income groups than it is higher income groups on average higher income groups will be less impacted. as greg mentioned, starting to be more concerned about necessities, if you will, where lower income groups, the bigger portion of the demographic at walmart is probably starting to feel the pinch and looking more at saving money to get necessities. >> sales, greg, weren't they strong at walmart? wasn't it some of the cost inflation on food and transportation and energy and wages that's hitting walmart do you expect the same for target tomorrow or is walmart doing something differently? >> look, sales were good so sales for walmart were up 3%. for home depot it was a comp

the key is home depot is able to keep their margins and whatever costs they were seeing, they were able to pass through for the near term. and whereas walmart couldn't pass through all the rising costs they had in everything from labor to fuel as well as home depot was so from an earnings standpoint, that's where the market -- i didn't mean is the expert here on this. i would say if walmart is classified as a consumer staple stock. when you get a consumer staple stock that misses that much on margin and the earnings get talked down and there's a sign that there's an inventory overlead that could take a few quarters to get rid of, that's why walmart is getting hit so hard today home depot have the demand and inventory they need and no reason to have massive promotions to move it. >> greg, what about target tomorrow, wouldn't they be dealing with these same pressures? >> target will be interesting. i think the read-through here is the sales should be fine we think target's customer is in

a pretty good spot as we talked about before i think they have had stronger traffic, so i think traffic helps you. basically home depot has customer counts up 5% still from 2019 whereas walmart's are down 9. and target has been growing its customer counts over the last two years. so target has a shot to have strong sales the big question mark there is margins, and that's frankly why we've been in line on the stock. we think target is pretty cheap but our concern is the margins, not just the near term but particularly in the back half. >> jim, given all these pressures and changing dynamics, what do you do with this group how do you feel about retail, consumer discretionary, staples during this environment? >> i don't like staples but i do like consumer discretionary a lot. if i look back historically, all of the major performances by

consumer discretionary stocks were decelerating inflationary environments accelerating inflation were the biggest underperforming periods. it not only destroys demand, as we're starting to see, but it also pressures the companies' margins, as greg was talking about. worse than that, it destroys confidence and forces consumers to reel in their animal spirits, if you will. i think inflation is peaking as it does, i think we're going to see risingconfidence, greater animal spirits and to greg's point they're going to start using their balance sheet and good job market prospects in a bigger way towards discretionary items. these stocks have been beat up in the last year, better relative values. i think it's a great time to commit. >> yeah, the groupdown 26% thi year, up really well today we're seeing the cruise lines that are in that group, retailers like under armour and home builders catching a bit today. we'll leave it there

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index's 15% decline. walmart is really what's sinking, it's down 11.5% at the same time, we're watching a broad rally led by materials, tech and financials. the 10-year note yield under some pressure today with the yield nearing 3% again, the 10-year note under pressure yields are a little higher joining us now is johnny fine. johnny, i think the headline today is that the fed stopped spooking the markets we had how many fed speakers this morning and just heard from fed chair powell this afternoon in the last hour he was talking tough on inflation. we're going to keep expeditiously raising interest rates, going past neutral, whatever it takes to fight inflation. guess what, the market is still rallying has the market gotten past all this >> i think you're 100% right, sara we're moving to a point of inflection with respect to fed speak overall. really since the beginning of the year, every time there's an fomc member that's had the opportunity to engage the

public, they have taken the market to a more hawkish position than it was previously. i think today and maybe in the last couple sessions is the first instance -- effect yael the fed saying, yeah, the market has it right it's now priced appropriately for what the fed is likely to do. >> so what does that mean? does that mean that you should be buying bonds now? it's not working today, but that's been in the last week and a half the change. >> i think most importantly, it might be signaling that we're nearing the end of fixed income volatility one thing we've been looking at since february is the moving index. the volatility of u.s. treasuries, the second cousin to what the vix does. that's been trading at extraordinarily elevated levels. levels we haven't seen in a dozen years and even at the start of the pandemic where we did see a brief spike higher, we're not trading that far from those levels

i think one of the key unlocks from here is a tampering down of rate volatility in that move index moving lower. >> that could be good news for stocks a lot of talk of recession lately and are we going into one and how soon is it coming. the credit market could be a key signal there what do you see as far as recessionary risks and warning signs? >> i don't think the credit market is calling for a recession. yes, credit spreads have been widening in investment grade over the course of the year but they have done so in a very low beta manner to the equity market overall. it's sold off less than more one would expect and rallied more than one would expect. so i think what that's telling us is corporate america did such a good job in fortifying its balance sheet coming out of the pandemic that ultimately recession risk is low. now, we've taken down our growth forecast next year as i'm sure you've seen.

we see a one in three shot of there being a recession next year as does the market. it's enclclear that the fed hasa very tough job to land the plane here overall but there's no canary in the coal mine as far as credit is concerned. >> so companies still can finance? i know it's been affected somewhat having to pay higher rates. >> obviously the cost of financing has gone up from both the rate component and the credit spread component. to put it in context, we've financed $680 billion of investment grade credit alone. that's the third busiest start to the year that we've had on record markets are open deals are getting done there's strong sponsorship yes, costs have risen but overall there's no cessation of activity, no freezing over of credit markets the investment grade market from aaa down to bbb minus alive and kicking. >> when i usually talk to bond guys like you or credit experts,

it's usually sort of a pessimistic conversation and it's something ominous for equities but if i'm at home and wondering what's happening with the volatility in the stock market, it sounds like given the signals in the credit market you're fairly optimistic. is that the takeaway or at least a little more sanguine. >> i think that's right. not every corner of the credit market is working at investment grade. there's been changes in the dynamics in the equity markets over the course of this year that's made it more difficult to find a foot hold they have very small debt stocks outstanding. those are finding execution trickier and in some case not having the access that they wish that they had. that's something that i think with a tampening down of rates well fix that part of the market as well. but i say the market has had

liquidity strains over the course of recent weeks and months. >> well, we'll talk to you if we get there again or sooner. jonny, thank you >> great to see you. let's give you a check on the markets right now. today is a rebound day, up 431 on the dow jones industrial average. s&p 500 going strong into the close, up 2% every sector is higher on the back of those rising rates you are seeing financials do well. chips are in the lead. chinese internet stocks are doing well the nasdaq is up 2.7%. coming up, how concerned should you be about a recession in america we'll ask jack lew what he's forecasting. as we head to break, check out take-two interactive getting a big jump jim cramer will speak to their wl about the corner andal street's reaction tonight on "mad money." do not miss it we'll be right back on "closing bell."

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updating the market today, but the recent sell-off has fueled fears of growing fund outflows and management stocks have taken a big hit mike santoli taking a closer look at that group for his dashboard. some of these brokers you'd think would rally off higher rates. >> they did, especially at schwab the late part of last year they should benefit to some degrees athe fed raises rates. but the asset values drag on the other direction. with stock and bond markets both down, the value of the assets in the funds declines obviously that's what their fees are tied to and people are afraid to what's going to happen to fund flows. but you see the stocks over the past six months have already taken on a lot of punishment and so the argument now is, is longer term value being created in these stocks. so schwab, blackrock and t. rowe price are right down near the bottom of their 10-year range. charles schwab actually pretty close to as low as it gets that's in the grown.

t. rowe price very price again, high quality operating and blackrock as well. so if the earnings are in the ballpark of being correct, you might consider them to be leveraged bets on the markets finding their footing because they're going to have a magnified effect as markets do better obviously there's always a risk that doesn't happen, but this shows you that the market has already cheapened them to some degree. >> are we seeing a corresponding amount of outflows >> you're seeing the beginnings of outflows. only 3 or 4% of the money that flowed into funds in general last year have come out. the fear is that losses build up and people decide to flee or at least no inflows are not going to be likely any time soon. >> mike, thank you we will see you in the market zone. up next, former treasury secretary jack lew on whether the fed's aggressive moves to fight inflation are increasing the risk of recession.

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its worst days ever. earnings were a miss inflation is weighing on its bottom line. quote, u.s. inflation levels, particularly in food and fuel, created more pressure on margin mix and appear rating costs than we had expected, he said high er wages are also we get their profits. they cut their profit outlook and expects a decrease of 1% instead of profits increasing. inflation is hurting walmart's profits as it drives up costs. warren and others point to oil giants as well who have reaped billions in profits and are returning it to shareholders in the form of buybacks and dividends. again, they don't have pricing power. they can't gouge consumers when they sell oil. the reason profits are exploding is because global oil prices are way up to be sure, lots of companies are jacking up prices and boasting about their ability to preserve profits bypassing heex on to the consumer, but there's a limit there and they wouldn't be able to do it if their own

costs wreren't skyrocketing. and profit margins this quarter are actually declining after being stable the past three quarters so inflation objectively is more of a hit to profits at this point and it's not just walmart. hard to blame corporations for the inflation we are seeing. fed chair jay powell speaking last hour with "the wall street journal" talking about how the fed will try to tackle inflation without sparking a recession listen >> it is going to be a challenging task and it's been made more challenging in the last couple of months because of global events. so it's challenging because unemployment is very low already and because inflation is very high >> joining us now in an exclusive interview, former treasury secretary jack lew. secretary lew, great to have you again. welcome back. >> good to be with you. >> do you think the fed can pull it off, fighting inflation all the way back down without taking us into a recession? >> look, i think that it's a hard job

the history of rate increases to get things back to normal certainly makes the odds of there being some bumps along the way pretty high. but i do think the way the fed has managed since the beginning of the covid crisis should give us all some confidence that they're going to be moving step by step, watching what the impact is, trying hard to avoid the hard landing that would be very painful there are a lot of things going on in the world right now that they don't control some of those are contributing to making it much harder but they're on a path. they have been clear in communicating it and i think the road ahead is going to create uncertainty and volatility but i certainly hope that they can at least be bumpy and not hard >> where do you see inflation going? do you have a forecast of when in your mind you think it's going to peak and come down, given the fed's fight and all of the supply chain issues, the

war, everything that's contrib contributing >> i think you have to break inflation into multiple parts. the general direction of the economy, the demand in the economy, growth in the economy will be affected over time by what the fed does on instant rates but that's not instantaneous. when you see things like oil supplies shutting down because of a war and prices spiking, that has a much more immediate impact so i think you can see in some parts of the economy signs of inflation settling down. last month's jobs report showed a much lower wage increase than we've seen in the past one month's data doesn't prove where it's going but it's a good sign things like used car prices, they're going down, not up there are other things that are still feeling upwards pressure so things are going in both directions everyone i talked to expects that over the course of the year there will be a substantial

settling down, but i don't think it will be back to normal by the end of the year because the world has changed and it's going to take longer to get there. i think that one has to look beyond kind of the immediate six-month period ahead and say where is it going to settle down afterwards there does seem to be a risk that it's going to settle down higher than many of us would have liked to have seen. if so, that will mean that the fed will have to keep looking at what do they need to do over the longer term. i think they have been right to move gradually, because we don't know that's the case they do knowif they move hard and fast, they can trigger a recession. they're trying to thread a needle >> meantime, it's a midterm election year and this is becoming very political. it's the number one concern right now for americans, as i was alluding to, and there's a lot of blame, the blame game on who is most responsible or responsible at least for inflation. i just wanted to get your take

on something that president biden tweeted out and then got some blowback from one of the richest people in america, jeff bezos. so the president tweeted want to bring down inflation let's make sure the wealthiest corporations pay their fair share. then he got called out by jeff bezos who said the newly created disinformation board should review this tweet because raising corporate taxes is fine, taming inflation is critical to discuss but mushing them together is just misdirection. i'm curious who you side with in that debate? >> well, i don't participate in twitter debates, never have and probably never will. i think that the causes are complicated. i think that when you look at what we need to do in this country to address some of the problems that are not necessarily contributing to inflation but are making it harder for families to deal with inflationary pressures, we have to figure out how to pay for

that so take something like increasing the availability of child care credits, having families have angccess to refundingable tax credits. families, some of them middle class, some of them down near the poverty line you have to pay for those things one of the ways to pay for them is through some of the tax proposals. i'm not sure i would make it a cause and effect. >> yeah, i get it. i get it but raising corporate taxes and taxes on the wealthy doesn't bring down inflation but i think your point is interesting because you wrote an op-ed on making the child tax credit permanent with another former secretary. doesn't that increase more spending right now at a time where we're already dealing with inflation? why would you inject more into the economy? >> the point that we made in that piece that we wrote, if you more than pay for it, even though families that have low incomes are likely to spend at a

higher rate than those of us with higher incomes, you're reducing the deficit by more and net it's not going to be inflationary so it is a question of whether your fiscal policy reflects where you are at the point in the cycle. at the moment where there was a global health crisis and we just had to make sure that when you shut down the economy things could come back, no one asked what did it cost now it's right to ask what does it cost and paying for it is the way for it not to be inflationary. >> one of the -- i have to ask you finally, i've asked you as treasury secretary a number of times something that you were never able to answer but now that you've a former treasury secretary, hopefully you'll answer is the dollar getting too strong we're starting to see it impact earnings, impact exports, impact emerging markets' economies as we see the euro fall to almost parity against the dollar. is that going too far? >> it probably won't surprise you, sara, that i still see the

problem as other currencies and other economies are too weak driving up the strength of the dollar, there is this confidence in the u.s. economy still. we are growing still interest rates are going to be rising as the fed raises rates and other economies are not catching up as quickly so i think the solution is more global growth. as i have always believed, targeting the value of your currency against the notion of where it should be is a risky business so i think that we're at a moment now where you look at a country like japan, very weak currency now there are other examples i think getting growth up prospect better around the world is more of an answer if you look at china, the value

of the rnb is down because their economy is shut down again they have to get out of this covid shutdown in order for them to bounce back so there are a lot of things driving this right now. >> yep, agree. actually we've had a sharp three-day fall here but still near some strong levels on the dollar treasury secretary lew, thank you for joining me always good to see you. >> always good to see you, sara. we are holding on to the gains, up more than 400 points on the dow jones industrial average. if you look at what is driving the dow higher, we've got boeing adding a lot today, jpmorgan banks are in solid shape today home depot after strong earnings and strong sales, especially compared to walmart, which is the biggest drag on the dow, taking 106 points off the dow. s&p up 2% so we're building on those gains. a top market strategist reveals which part of the tech sector she is so bullish on right now. tech is coming back in a big way dawi t nasdaq up more

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check out some of today's top search tickers on cnbc.com the 10-year note continues to take the top spot. yields higher, just below the 3% level. walmart sinking 11.2%. this is walmart's worst day since 1987 if it closes down 12% it's the worst day ever in reaction to a miss home depot has better earnings and better sales of 2.5% tesla is rebounding to the tune of 5% and even twitter is up 2.8%, even though elon musk has put the deal on hold according to his tweets to find out more

about the bots and whether twitter is accurately stating that 5% bot level. amd shares also surging today on a big upgrade. how that is impacting other chip stocks. plus chinese tech stock taki o angffnd a bullish call on cybersecurity when we take you inside the market zone, next when you become an expedia member, you can instantly start saving on your travels. so you can go and see all those lemons, for less. - hiring is step one when it comes to our growth. we can't open a new shop or a new location without the right people in place. i couldn't keep up until i found ziprecruiter. ziprecruiter helps us get out there quickly and get us qualified candidates quickly. they sent us applicants that matched what i was looking for. i've hired for every role, entry-level technicians, service advisors, store managers. ziprecruiter helps me find all the right people, even the most difficult jobs to fill. - [announcer] ziprecruiter, rated the number one hiring site. try it for free at ziprecruiter.com (all): all hail, caesar! pssst julius!

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we are now in the "closing bell" market zone. mike santoli is here to break down these crucial moments of the trading day. kristina partsinevelos and kristen on where she is buying opportunities in technology. stocks near session highs. dow is up for a third session in a row but the s&p and the nasdaq

importantly are up strongly today, mike. how do you know whether to trust a rally in this kind of environment? because you know the bear market rallies can be fierce and can fool you >> yeah, for sure it's tricky. i do think friday's rally, the characteristics of it, how broad it was, gave you a little bit of a cushion in the sense that perhaps it was somewhat over due. we got washed out enough also incremental evidence that there has been sort of a sold-out nature of the market, whether it be the bank of america global funding manager survey, highest cash levels in 30 years or the reports of the big hedge funds on the ropes having liquidated out of the big tech stocks. just a sense that the market has less concentration risk, less crowding risk and the valuation has come down. i still think you can go up 5 or 6% from here and still have the decision to make as to whether we're selling these rallies. that only gets you back to 10%

of the all-time highs so that's why it is always a tough call in the moment. >> i wanted to highlight the consumer staples it's the only sector that is lower today and it's one of the best performing sectors of the year in fact it's flat this year, which is a win clearly walmart is weighing on the group, down 11% right now. look at some of these other declines general mills, kimberly-clark and hershey. on the earnings call on walmart, the executives there did talk about the consumer starting to trade down to private label from some of the brands and that would suggest some pain for some of these companies. some of them do make private label, but a lot of them get their premium pricing on their own brands it's also contrary to what we heard from p & g and kellogg and some of these companies that consumers are paying up for the stronger brands. i ask you because it has been a safe haven for this market in an inflationary and slowdown market, usually people go to these staples like walmart or some of these food companies does that change today after

what we got from walmart >> i think it's a big part of the story, sara. the fact that you did have a lot of people in this sector, a lot of dollars flowing into it mostly because of the perceived safety or it was supposed to be predictable and also a haven from cyclical weakness and when the biggest grocer in the country, effectively walmart, does say they're having a little bit more trouble having their customers pay up for brands, i get why those are getting a little bit of a haircut today. it doesn't seem like a radical exit from the whole group. it really is at this moment a little bit more of a walmart issue. >> cramer noted a much better quarter dealing with all this inflation. fintech stocks are flying high after coinbase announced plans to slow hiring and reassess its head count because of current market conditions. robinhood has a new crypto wallet allowing users to have full custody of their wallets. kate rooney just spoke to them

and joins us with the highlights. >> reporter: i spoke to the robinhood ceo. the company is letting them store their own crypto and nfts. they're competing with coinbase by doing this for free doing zero fee, similar to the brokerage side of the business he wouldn't say how they are going to monetize this yet he said revenue would could eventually i asked about robinhood laying off about a tenth of its workforce. he said it's about cost discipline here's what he said. >> it's about cost discipline. we obviously know that when the fed is sending stimulus and the markets are going up and interest rates are low that things are great and it lifts all boats. but i think it's the companies that exercise that discipline and show that they can stand the test of time through rough market conditions. >> the market conditions have certainly changed since

robinhood went public last august we also talked about the ceo of ftx. he bought 7.6% of the company. he said he knows him, he's met him, he's a smart guy. he didn't answer it really with a straight answer. he said that there are a lot of shareholders in the company. he said he's happy to have new investors involved, but no comment on if sam reached out to him or how that whole thing went down also asked him about charlie munger and warren buffett, two of robinhood's biggest critics he did say if they were starting their investing journey right now, they'd be using robinhood anyway, back to you guys. >> i think they'd beg to differ, kate how many of your companies that you cover in this sort of new, hot fintech area are cutting costs, pausing hiring, cutting staff. it feels like there have been a

lot of announcements right now. >> there's been a ton and i'm told likely more on the private side when it comes to venture capital. coinbase announced this morning they are slowing hiring, so no layoffs but they had huge plans to triple the workforce. they have called that off saying we're slowing down the hiring process. again, it's about cost discipline and needing to show profitability at this point. like you mentioned, the stocks are all down significantly from the highs last year. the pictures really change when it comes to fintech and growth at all costs it's now about things like cost discipline, like vlad tenev mentioned. >> and these companies have not been through cycles and bear markets and hikes and inflation. how are they going to make it through? are they good, sound investments right now because they have lost so much money? >> we don't know exactly how the customer base is going to react or evolve. so we don't know if the customer is going to either adapt and say we're going to build our balances up, we're not going to be all about free trading.

what i do think, though, is these companies have been whittled down to very modest market caps. i'm not saying that they're cheap because robinhood doesn't have earnings. but robinhood and coinbase together are less than $25 billion. they're now marginal players if they show staying power, it's an upside surprise >> kate rooney, thank you. amd one of the big winners on wall street today sparking a rally in chip stocks after piper sandler upgraded the name from overweight to neutral. hiked its price target to $148 from 98. the analyst says there are two old sayings. do not try timing the company and bee good companies when they are down amd shares have plunged 30% this year kristina partsinevelos joins us. what are the takeaways >> it seems like he's bullish

about the entire sector now. primarily the first point has to do with commercial pc sales. those are doing quite well and offsetting any losses from people like you and i who may not be buying laptops anymore. amd does have exposure to that market the second point is those custom chips going in gaming consoles if you're a parent you may know it's difficult to get an xbox or playstation so he believes that will further drive the market. i was just reading about chen bro and quanta computing they are bullish on u.s. and chinese consumers primarily because of the cloud which we know is a sentiment echoed by microsoft. and a second point is in the second half of this year we'll see new processor from intel as well as amd so that should further help demand. lastly, we've got to round it out with four points, that maybe some of these stocks in the sector have already taken in those police cuts for future

earnings so maybe they have come down in terms of valuation >> well, they are rebounding in a big way. one of the best subsectors chinese tech stocks also outperforming for several reasons. investors optimistic a key meeting between chinese regulators and corporations could lead to an easing of the crackdown on this industry there are also new hopes on the covid shutdowns that they could be lifted as a result of possible diminished risk jpmorgan upgrading its view on chinese tech stocks from overweight to underweight. jd.com reporting better than expected earnings. deirdre bosa joins us now. how do some of these names look on a valuation basis and how about that u-turn from jpmorgan? >> u-turn sgindeed it was only two months ago they called chinese tech uninvestable they're looking as attractive as they ever have been. remember, hundreds of billions of dollars have been wiped off the market caps, trillions even

when you take into account u.s. listings, hong kong. they cite valuation. they pointed to olalibaba's forward pe ratio interestingly, though, jd.com not included its forward pe ratio is at about 22 times that's below 25 to 40 times but that wasn't included with jpmorgan's picks it all begs the question, though, guys, why the change of heart. sara, you touched on this. we didn't know when chinese regulators would smack down these names. now they think this is opening up and it's a good time to invest we always say you need to have the stomach to invest in these chinese names. if you do, then these valuations are looking attractive but you've also got to believe there's stimulus coming. >> stimulus, chinese regulators. there's a lot of hard to figure

out things stocks look to close out with big gains nasdaq is up 2.5%. kristen bitterly joins us. technology, buying opportunities. would you go into this sector after some of the carnage that we've seen at this point >> what's really interesting is when you look under the surface, the nasdaq is down around 25%. we have 60% of those underlying stocks down 20% or more. 40% are down 40% or more and 30% of those underlying shares are down 60% or more so it's a very natural question as to whether or not there are opportunities here there's two things to keep in mind, though in this market and given some of the conditions and some of the head winds, we really wanting to delineate between what are profitable companies and what are hypergrowth stocks that are call options on unknown futures. we are leaning into quality and building positions in some of those names for the long term.

the second piece is look to some of the subsectors out there like cybersecurity. this is an area where there's going to be durable demand it is no longer a nice to have, it's a need to have from a corporate governance standpoint and really has become the g of esg, environmental, social and governance so some of the sectors we like but really focus on quality. >> how do you define quality right now in technology? can you break that down any more specifically >> of course so these are strong companies that have been consistently growing their earnings, they lean towards that durable demand and also have been consistently growing their dividends. this goes beyond technology in terms of areas where we have been adding exposure very comfortably over the past six months so this expands beyond technology but into areas like health care, where there is durable demand where you see areas like pharmaceuticals. those are the areas. if you look at the broad-based

sell-off we've seen in equity markets today, those types of companies are actually dividend growers, u.s. equity dividend growers are down 7%, where the broad based market is down 15% so this is not a unique view to technology but taking a step back and looking at those quality companies more broadly. >> mieke, the b of a fund managers survey today showed that technology stocks are the biggest short since 2006. >> yeah. so essentially active funding man fund managers are as underweighted as they have been since 2006 a lot of it is tell me about what the market did the last few months and that will color their stated positioning to me why it says there's a little cleaner setup here in terms of no longer as crowded in that area. i just think the general market feels as if it got pretty defensive in a hurry doesn't mean it's all culminate and doesn't mean that the

downturn is over, but it makes sense we paused just ahead of that 20% level on the s&p 500. >> kristen, you mentioned health care as one of the places that you like for quality can you get more into that is it biotech which has lagged is it pharmaceutical companies the whole group actually has been working. >> the whole group has been working and we've seen that as an area of strong outperformance compared to the broad based market the pharmaceuticals is the area that we like looking forward again, it goes back to this concept of what is going to be durable demand i think that's really interesting. if we look at what's fueled some of this rally today around retail sales and consumer spending, there are some cracks in terms of this consumer story. so when you look at what is actually fueling that spending, we are seeing pre-pandemic levels of the personal household savings rate we're seeing pre-pandemic levels when it comes to credit card balances and actually we had a record 537

million credit cards opened in the first quarter of this year in the united states and so when we see those cracks starting to unfold as to how consumers are actually spending, you want to lean into those areas, like pharmaceuticals, that will have durable demand. >> quickly, how much of your portfolio should be in cash right now? >> none. >> stocks and bonds? >> bonds are what we really like in terms of what we have high conviction bonds are back whether we've hit peak rates at this rate or whether we're going to see it throughout the course of this year, we are very confident in adding high quality fixed income in terms of u.s. treasury, investment grade and also in municipal bonds where we're seeing that yield ratio compared to tax equivalent at 90%. that's an area to add some hedging diversification and really asset allocation is back. >> kristen, thank you.

>> thank you. >> appreciate it kristen bitterly just under two minutes to go, mike what do you see in the market internals as we rally into the close? >> pretty solid, sara. not as dramatic as last friday but definitely pretty solid. take a look at the 2-year note yield. we did get a little bump higher on some of those aggressive seeming comments from jay powell but nothing really new the yield level tells you not a lot new. we're slightly below the highs it supports the idea that powell hinted at that maybe the market has priced the fed's intentions reasonably well. vix is down another point and a half or so, down around 26 so created another spike on the chart. it shows you the market is on a little bit of firmer footing. >> as we head into the close, the dow is up 400 points what is leading us goldman sachs contributing the moechlt. boeing, visa, caterpillar. walmart is a big drag on the dow

taking 100 points off the dow. s&p 500 higher to the tune of 2% so a nice rebound there. every sector higher except for consumer staples you've got technology, financials and materials in the lead the nasdaq closing out with a gain of 2.75% so a big relief day. unclear whether this is the start of a bigger bounce but certainly positive all the way around that does it for me on "closing bell." now into "overtime" with scott. sara, thanks so much welcome to "overtime," everybody. i'm scott wapner we're right here getting started. in just a few minutes i'll be joined by anastasia amoroso on whether this rally has some legs we do begin with our talk of the tape and it is the trustworthiness of this market move it sure feels good after all of the pain that we've endured but can you believe it it's the key question. we ask it of joe terranova of course the halftime investment committee a