health of their balance sheet. >> it has been a great point and it's been oddly quiet and we may not hear, that cab a trigger lauren, thank you very much. our lauren thomas, keeping an eye on retail and we are a week away from one of the large effort ports of america and what would it mean on the story of the year we'll have that on "power lunch" this starts righ ♪ ♪ >> and it most certainly does, kelly. welcome, everybody, to "power lunch. i'm tyler matheson, this is a very busy day on several months and look at the markets and the averages of at least 2% today and 5% on the shortened week, one of the rare weeks where we've had green numbers as we slide into the friday close, and th of course, the supreme court overturning roe versus wade and

we'll talk about the corporate reaction and we'll keep you on top of all of it as it breaks this hour. >> thanks, everybody as tyler said a big rally for the markets today and look at these week to date changes, this despite the university of michigan consumer sentiment showing a decline in sentiment in inflation expectations. so the latter is helping boost sentiment. the dow's up 5% this week. the s&p up almost 6% and the nasdaq up 6.5% this week so leading the dow today, salesforce and goldman and boeing, boeing up 17% in the past month and we'll have more on that stock coming up and this is the price action and 5% gains for these three and atop the s&p and it's travel everything and the cruise lines are finally soaring again after strong numbers from carnival and royal caribbean and norwegian in the middle there and the casinos are rocketing higher and mgm resorts and 10% gains here tyler? >> kelly, let's get back to the hi historic news out of the supreme

court striking down roe v. wade after nearly 50 years, even though we had an idea this would happen, the official decision sending shock w sending shock waves across country. >> it was turning the issue of abortion back over to the stateses and to the people's elected representatives and it took a short time for the people's elected representatives to start fighting about what will happen next including the possibility of a new federal law that would restore abortion protections on a nationwide level. no indication whether that will happen or not, but president biden talked about the prospects for it in his remarks to the country. take a listen. >> the only way we can secure a woman's right to choose in the balance that exist side for congress to restore the protections of roe v. wade as federal law. no executive action from the president can do that.

if congress, as it appears, lacks the vote to do that now, voters need to make their voices heard. this fall you must elect more senators and representatives who will codify a woman's right to choose into federal law once again. >> now republican leader kevin mccarthy for his part on capitol hill coming out just a few minutes after the president that republican leader suggesting that what the president was pushing for there is a democratic extremist policy. here's what mccarthy had to say. >> every house democrat has voted for extreme policies like taxpayer funded abortion on demand until the point of birth. the democrats radical agenda does not have america's support. to the contrary, america rejects because they remain committed to our values and our principles.

>> tyler, this is the first time that we've seen the supreme court withdraw a right that it had granted 50 years ago, a widely respected right now we'll see what the political ramifications of that decision will be. this is politically uncharted territory, so it's not necessarily safe for political analysts to say one thing or the other about what is going to han, but what is clear is that there will be an enormous political fight over this between now and the midterm elections in november. let's say, i think there will be a remote chance that the congress passes such a law as the one president biden was calling for there, what would stop then there from being action against that law and what would stop a federal court from declaring that law unconstitutional or the supreme court? >> nothing would stop it at this point. what you would see immediately after congress passed such a law, if they could, and not at all clear that they can. >> no. >> but if they had the votes and could do it, you would

immediately see lawsuits against it given what we saw outside of the supreme court and that would go right up to the supreme court and you would have the same 6-3 conservative majority court dealing with the same federal law implaycations and the positions are pretty well staked out on these issues and you saw clarence thomas saying he'd like to go much further, he'd like to have the supreme court revisit decisions on gay marriage, revisit decisions on contraception. a lot of things that had been settled issues in american society for decades now, clarence thomas would like to go back and revisit with his majority on the court and not clear that will get a sense of what will happen and this court is going pretty far to the right and pretty quickly >> eamon javers, thank you very much. >> corporations trying to navigate the issue bertha coombs has the latest >> corporations and the healthcare industry, kelly

50 years ago before roe it wasn't as if abortion was covered by insurance and by employers, now it has been over the last 50 years and as we look at where it is going to be illegal now it's going to create a very divided patchwork of benefits for insurers that provide them and they would not be able to provide coverage for individuals and small businesses who are often fully insured in most states where it is illegal. for larger employers they'll only cover it in areas where it is legal a number of employers have said they will provide travel benefits to be able to go to those areas where it's legal obviously, this implicates doctors. this implicates hospitals as far as medical procedures and it also implicates the pharmacies, as well. nearly half of abortions are performed medically. so the pharmacies dispense the so-called morning-after pills and they'll have to look at the

patchwork nationally of where they can do that and how they can help their employees and their customers to have access in places where it is legal. i spoke with ross brewer, the ceo of walgreens yesterday saying she said it was going to be very, very complicated. i spoke to her here at the aspen institute. she talked about how she's likely to respond with today's ruling >> i do think it's going to be complicated. i do think we will have to address it as a company and our benefits packages will need to adjust everyone, i think, in this space is looking at do we provide travel benefits if that's, you know, a requirement and it's back listening to your customer and your employees and i'm committed to listening to my employees and abiding by state l legislation, and so i'll find something in the middle there. >> a lot of companies trying to find the middle ground we haven't gotten an official statement from walgreen's and we

have heard from cvs which said it is going to support its employees and provide travel access of course, we heard from j.p. morgan, as well and citigroup had staked out a position on this and maamalgamated banks. the insurers, we heard from anthem and united health they are studying the situation and as cigna's ceo, david cordani told me a few weeks ago this is going to be a state by state employer by employer policy that they're going to have to develop. back to you guys >> bertha, thank you very much >> as bertha just mentioned, corporate america definitely, definitely caught in the middle on this issue. it is as thorny a social issue as a corporation's leadership we'll probably ever have to approach we've got employees on the one hand, consumers to take into account, shareholders and other stakeholders and board members more on the decision now with

kate kelly from "the new york times" and lecturer at yale university and both are cnbc contributors kate, as i just said i cannot think of another issue that could be harder to handle for corporate communications people, for corporate policymakers because there are so many sensitive spots in this. what are you hearing from the sources you are talking to >> yeah, tyler you're absolutely right. i think companies are trying very hard to thread the needle here i think what we saw over the last five or so years is that corporations and ceos were becoming increasingly vocal about issues they cared about. i remember seeing this as an emerging trend after the charlottesville, violence and corporate ceos stepped off of advisory panels to the white house in an objection to how president trump handled the aftermath of that. we've seen corporate leaders speak up increasingly about issues of immigration and the environment and so on, but it's

not without a backlash first of all, as you know, companies have diverse workforces in many cases they may have employees where the whole range of political perspectives around all 50 states and they don't want to alienate their employees and they also have stakeholders including clients, including local, state and federal politicians who govern them and may serve their services and there are a lot of people we're doing here i think what we've seen is a backlash and notably the groups and a stance where the company has taken and there is a group that's attacked black rock for esg investing and more recently they accused american express of being racist against white people abortion is the most controversial of issues and companies on the one hand want

to know that they care about their concerns and their well-being and that's where they see these sort of quiet policy chges around travel services to attain abortion if needed, but at the same time they're fearful of alienating people, and i don't think we've seen a lot of huge, bold statements in today's aftermath as companies try to take the temperature. >> i was speaking, joanne, earlier today to an executive whom both of you know who are in the corporate strategy world, and he said sort of the basic message coming out of both companies is we want to take care of our employees, that their health and access to equitably dispense medical care is their principal concern, but kate, joanne, just made a very interesting point. there are lots of people who feel that companies that come out on one side of an issue are, quote, woke. what is the possibility that there will be a backlash against

companies that in those states where abortion is deemed illegal, a serious backlash against companies that are in trying to serve their employees' medical needs really violating the law of the state for example, texas is there a possibility that those companies could be the target of violence and things like that. how much is that a worry for corporate leaders? >> there's so much in this decision tyler as well on and we've seen a backlash. florida and data, and it is revoking its land use right.

wide one of the things you hit on here is employees have been, treatmently rokal in these n couple of years to take a stand on controversial issues like that on abortion, but keep in mind it's been a tight labor market employer employers have had the upper hand in pushg the social questions. so if we are indeed heading into a recession or a slowdown, employees -- if we are no longer in a tight labor market and employees no longer have the upper hand, that can also play into how this all turns out and plays out over the next few months and years >> kate, final thought from you on how these companies are trying to thread the needle and whether ultimately they're going to be able to do it because so

many companies have employee bases in so many states, in states that are more liberal on abortion like new jersey and those that are going to be more restrictive search as presumably, florida, tennessee, texas, louisiana, et cetera. >> tyler, first and foremost these companies will want to follow the law if they haven't already, they have their internal lawyers poring over the current legal status of their states where they employ people to see what is possible. i think to the extent possible, companies will provide travel services and coverage for people to obtain abortion services because there could be cases where there is a medical need for abortion and they want to make sure they're present for employees in those cases >> i think beyond that there is a little bit of a wait and see approach bertha did a good job of what's been said already and this is not a surprise to people because of the leak of the draft

opinion. even with that, the actual news has had a company preparing for this one former ceo said he participated a few weeks ago in a 200-ceo session where this was discussed and people were on high alert and high concern about it i think there's a reluctance to be first in making what could be perceived as a political statement about there, having elt el settled that we will see a trickle of these issues. >> it will be interesting to see which companies do what. i'm thinking of a company like chick-fil-a or hobby lobby that have much more sort of faith-based businesses, let's call it. they may be on one side of this and other companies will certainly be on the other. it's always good to see you both, joanne and kate. good to see you. >> thanks. >> thank you markets are closing out the week with a big gain in the meantime the dow is up 900 points trying

for its first positive week in four up next one market watcher tells us what the battle of potato chips versus semichips is telling us about sentiment we're not kidding. we're back in two on that and much more on this huge market day. don't go anywhere. ♪♪ this... is the planning effect. this is how it feels to know you have a wealth plan

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welcome back to "power lunch," everybody. the dow is up the second time in the week if the last 13. the nasdaq is up 6% this week. our next guest still expects consumer staples to outperform he says when the conversation on wall street is about potato chips instead of computer ones that's when you know investors are scared pepsi down 1%, while nvidia down 2% the perfecten capsulation of the environment that we've been in in the past six months and is it possible that we're about to see a major regime shift >> so, kelly, there are only two certainties that we have going into the second half of the year and there are only two certainties. number one, profit growth will decelerate we know that we know the comparisons are very easy and they're very hard and the profits will slow and number two, the fed's going to tighten. if i ask you to take

combinations of profits growth in fed tightening or easing, i'm sure you would not choose the fed tightening and profits growth decelerating and that's the worst combination that you can possibly come up with. so what we're doing is we're straddling late cycle and defensive, and i think what's very interesting is the discussion in the markets has been pretty consistently, do you want growth or cyclicals only recently are you getting discussion about defensives and true defensives when you're full of recession when defensives work the best in recession >> can you go from late cycle to early cycle without having to end the cycle in between i sort of doubt that i suppose it's possible. anything is possible, but history says you go from late cycle to defensive and from defensive to -- to cyclicals and that was my point about potato chips versus computer chips. when everyone is embracing

potato chips and nobody's talking about computer chips and that's the signal that we're in the bottom in technology. >> so when you say we've toned down the cyclicality in our portfolios, put some sharp names on that. in other words, that means sell this, buy that and i don't mean you have to name specific companies, but sectors >> sure. >> -- or companies >> so tyler, we were overweight the energy sector and it's been my favorite sector for the past couple of years since after the pandemic, the 2020 story and the 2021 into early 2022 and it was all really about energy and we were dramatically overweight energy in our portfolios we are now slightly overweight energy and we are now more overweight consumer staples than we are energy. that's a huge shift in our portfolios whether you look at energy and you look at materials and industrials, and it's the late cycle play and consumer staples are now our biggest overweight >> so i want to go back to what

i said a moment ago, rich, to when we go to sort of defensives than to cyclicals and can you talk a little bit about that and like you said, if now you're seeing some signs of a breakout in technology, what would that tell you >> i think right now the breakout in technology is a little bit of a head fake. i think that people think that we'll magically return to 2018 and the inflation subsides and the fed stops tightening and it's all beautiful and we come back and talk about tech innovation, disruption and cryptocurrencies we don't think that's a very realistic scenario that you're not going to squash inflation without some slowdown in the economy and we can talk about whether there's recession or sht and you need a meaningful slowdown in the economy to squash inflation here. so we don't think that we'll return to 2018 like it was all a nightmare, a bad dream and wake up tomorrow. we don't think it will happen. >> how long do you think

defensives can outperform given that they can outperform for the first half of the year >> that's a funk of how aggressive one thinks the fed is going to be. my personal opinion is the fed hasn't even started getting aggressive yet given that the real fed funds rate remains historically negative and every recession in the last 50 years has been preceded by a positive real fed funds rate. we have a historically real fed funds rate when usually the positive one that precedes recession, so i'm not even sure, my personal opinion and i'm not even sure that the fed has started to get aggressive yet. they're talking the talk, but they're hunting it with pea shooters. >> in that case, it can all have legs and room to run. >> exactly like an elephant getting hit with a pea >> wouldn't want to be here that one. richard, thank you very much good to see you. >> thanks, guys. see you later. >> rich bernstein. >> if you want to look at a

stock at a stock that wall street can't make up its mind over, netflix. it's had as many up days as down ones where does it go from here we have an old bull versus bear debate ahead before the break, a check of the names bringing the nasdaq higher and here's technology outer with forming with datadog up 20%. okta, z kaler and mercado libre up 15% we're back in a moment your record label is taking off. but so is your sound engineer. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire hey lily, i need a new wireless plan for my business, but all my employees need something different. oh, we can help with that. okay, imagine this.

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welcome back to "power lunch," everybody. big news day today and a big market day let's go to dominic chu at the new york stock exchange for a look at today's rally and as kelly pointed out, we're going to have a green week, it appears. >> and a strong one, right a pretty decent sized rally we're seeing and it's broad-based tyler, to your point as well. at or near the session highs pretty much since noon at this point. the dow, the s&p and the nasdaq each gaining more than 2% on the day. it's the small and mid-cap stocks that are doing even better than that, sometimes 3% now from a sector perspective, it's the economically sensitive ones, talk of financials, materials, industrials that are leading the way higher and as

you might suspect the other end of the spectrum is the laggards and the defensive sectors like staples and utilities and those sorts of stocks. some of the stocks themselves posting big moves to the upside include the transportation names thanks in large part to fedex because the shipping and logistics giant reported mixed quarterly results because it did say it expects a key measure of profits to rise in the current fiscal year. oil and gas stocks trying to reverse the steeper losses we see in just the last pfew weeks. eog resources and occidental petroleum, hess, and occidental petroleum of the s&p 500 center. on the down side check out what's happening in lending tree and the non-s&p and the online lender lowered second quarter guidance saying inflationary pressures have hit its business and upside names and down side names in this market, tyler, back over to you >> thank you very much >> let's turn to rick sants

el sa santelli after bond yields are down this week >> down this week does summarize it and the michigan sentiment is a 44-year low going back to 1978 record keeping and we did go on to the five to ten-year inflation rates and that definitely seemed to make a difference briefly if you look at the intraday of ten-year note yields and right as they were being released and we were at a 309 yields and they were close to 312, so we're higher and that does give you an idea and it put a lot of volatility with inflation moves the market boy, we had an intra-day high of 350, we had a high close of 347 and here we sit at 312 quite a difference, fed fund futures, we rlook at a two-week chart and the 22 basis points above the low close and that's a

quarter-point cut taken off the table and from the intraday contract lows and higher means less fed built into that contracts and that contract always seems to get what it wants with regard to the fed and finally the there are index and we all know with interest rates coming down a bit and fed funds future is higher and it is down for the day and down for the week, but as you look at the one-month chart, pending from the high close that you see there because it goes all of the way back 20 years to 2002, tyler, kelly, back to you. >> i promised last week i would ask you a friday question every week it's got to be quick what did we learn this week? >> we learned this week that there is a tale of two fed chiefs the one fed chief during covid times was a cheerleader for more fiscal stimulus. as evidenced by many headlines by the financial times and this week it was all about sticking and he didn't want to talk about past, pressent or future when it came to fiscal policy.

i'm not sure i agree on that approach and it made me want to do a little riff thank you for the question. >> did i tee the ball up or not? >> you certainly did >> ahead on "power lunch." a bull-bear binge, laying off more employees and raising prices and shifting towards ad-supported content ask dealing with strong competition. the stock is up 5% today we'll be back in two minutes thinkorswim® by td ameritrade is more than a trading platform.

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but that was an epic fail. with xfi we can stream, share, swipe, like... impress your mom with super-sonic wifi. it's unbeatable internet for a more unbeatable gru. i mean, you. >> all right welcome back wall street growing more and more divided over netflix and the future of that streaming giant. the stock down nearly 70% this year and investors are starting to ask the question netflix asks every time you fall asleep on the couch after bingeing "stranger things." are you still watching some of the top issues on the watch list, subscriber losses, streaming competition, rising costs leading to layoffs, price hikes adding an ag business and take over potential. takeover they were supposed to be the buyers of everything and not even a seller. web bush's michael pacter is our

bull with an outperform of their 280. he says sell $157 price target michael pacter the longest guy running bear on netflix has changed his stripes, why >> mostly because i have integrity and i actually think the stock's worth 280. so when it was created 600 it was a sell and when it was trading at 190 it's a buy. and did you think that you were colleagues and your fellow analysts who kept saying that the stock would be running, running running. are you saying that you are equally wrong now in thinking like matthew does that it's going to go down, down, down, down, down in other words, the wisdom of crowds or the madness of crowds. >> i don't want to disparage

math and you i don't know what his thesis is, and i'll let him speak for himself and on the way, it's a tendency to sell side and to tell him what happened and extrapolate why it's continued to happen, and on the way down, same thing i think these guys had a hiccup. clearly competition caught up with them. clearly subscriber growth slowed they were a victim of an outdated model where they dumped all at once and they're being ginning to emulate the competition there. they're picking up ad support so they emulatedcompetition there and they're starting to cut costs and they're starting to focus on not making as many movies so i think profit growth make it worth 600 and it's worth 280 >> matthew harigan, hiccup or heimlich >> i think it's more of a heimlich people have approached this as a tech name and more or less as a winner take all outcome and somewhere in that direction, at

least. i really think it's a media name we've been pretty agile and have advised on this before and of course, i -- we downgraded again it recently. if you apply the parameters for media stocks, we assume they're getting to 350 million in the next decade, near 20%-type margin and that's what the stock would be priced if you ran a valuation all of the way out, 2033, let's say and if the markets there is short term success, but you have other big loss of subscribers and guidance in this quarter. i think the second half would be as robust, and if you have the forecast and more toward tw27 ad 28 and 157 and i don't think it will be easy to instill advertising business and cut down on the password sharing, et

cetera >> so math you harigan my question is while your price targets differ by $100 or so right now. the real question is whether in the fliknetflix is a $600 stock is there anything they can do to redeem the story matthew, what are your thoughts? >> the street crystallizes around this being ex-growth over the next couple of quarters and be very difficult to lift the margins given the competition given the newfound cost consciousness. i think our price target is generous and the uber bull instance and certainly an 800 million home camp with the mobile devices as well and margins going to 40% and i think that's highly implausible at this point frankly, the company has a mixed record on content execution on spending i.t.'s billions, and i know that the bulls like to talk about the deed being early

moderate next year, but you have to look at the free cash flow here, and yow have 3% free cash flow year, and it is well in advance of the amortizations i would be very kifl here. >> michael, you get the last word here. matthew is certainly correct and the company spent a tremendous amount of content. when they have a hit they really got hits >> true, and i think they finally have figured out the formula and they'll make 25 korean language shows because they've proven out that the split game plays across border and the west and we'll see those are low-cost investments i think that what they really need to do is slowdown on quantity, and focus more on quality, adopt more of an hbo model which is 30, 35 shows a year as opposed to a thousand that netflix has, and i think you will start to see that you're seeing the layoffs and you're seeing that they're cutting movie deals.

i think that they're getting cost conscious i'm not predicting that they'll make $100 a share and be a $600 stock. i predict they'll make their 15 a share in the next three or four years with modest growth and keeping their subscribers through all those different features and ad support and cracking down on password sharing just to keep people from churning quite as frequently if they do all that and they make 15 bucks a share, it's pretty easy to see how it will trade up to 15 times earnings and that's essentially the market multiple. >> so it's not going -- >> not going to command a growth multiple as you say. there's more ofa slow growth narrative. michael pacter, nice to see you again. matthew harrigan, fantastic. appreciate it. >> agriculture commodities are higher today and still showing massive declines in the past month or so and we'll dive into that with the ag-related stocks

showing a ton of red is this a sign of peak inflation d at comes next? we'll break down the impact on the industry stay with us you're a one-man stitchwork master. but your staffing plan needs to go up a size. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire

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welcome back to "power lunch," everybody. ag stocks are getting hit this week cf industry down 6%. agco, 5% and the drop coming as grain prices fall significantly. just this month wheat's down 13%. corn's down 10% and even soybeans down 10%. so is this a sign of peak inflation we've all been waiting for in let's bring in the president of blue line futures bill baruque good to see you and what is this price action telling us. >> i think we are getting a little bit of a peak inflation story and what the fed is doing has worked and this is also a story here in each sector whether it's agricultures, it was cold, wet weather that was tough to plan in iowa, indiana, illinois and he's are big producing states and we've had very good, shot weather

supporting the planting and that was a very bearish for price action here. you also have some positioning dynamics not just in ag, but across the board, actions on july futures expired today, so i think that helped drive positioning down a bit and same way crude sold off last week and july crude oil expired and those options expired last week. >> so we are at a juncture where we have oil prices dropping, metals falling and the softs are underperforming and should investors take this as a pause in the bull market or as the end of it. >> for now it's a pause if the bull market. what the fed has done is they tightened financial conditions and you're see something disinflation take place right now and that ultimately it is going to allow them to again take their foot off the gas potentially. potentially. i'm looking at the cpi numbers to come out in june, july and august and come out in july, august and september and that's

my narrative and you can have an inflation showdown at jackson hole in august, and i do think that the cpi numbers are going to cool. what the fed has done starting at the end of last year, and mortgage rates reacted and obviously, was there some supply chain bottlenecks in the war in ukraine that lifted some premiums on a number of assets and that's worked through the system so i do think that these -- that the inflation will beat lower when the data comes out and they will resupport commodity prices. i'd definitely look more positive in the future here. >> so let me make sure i'm understanding you correctly. i think you said a moment ago that yes, maybe inflation is peaking, but no, when i look at wheat, corn and soybeans and things like that, the sell-off that we've seen is not really because inflation is schooling and it's more like planting conditions have gotten better and that this is a pause in a bull market and that would suggest that prices are going to

begin to rise again in the soft commodities and maybe in some of the hard ones. i'm a little confused. >> absolutely. you do have what the fed has worked to disinflate the economy. investors, whether you're a portfolio manager and you're chasing the narrative. there are people who had no energy exposure buying energy stocks when it was trading at 140. of course, it will roll over and we've been long this narrative for quite some time. just last week to put this in perspective, xle had nearly 1 billion options that were in the money to start the week expired. so you're looking at reit losing again. what you're seeing is the prices coming in as people chased them as highs and in the same way, to shift gears here, talk about the equity market. you have people panicking on the lows and you should be managing a position for much of this

year, not just managing it over the last week to two after may cpi number was hot and you had additional selling so what we saw last week in the equity market was volume on russell 2000 futures for the week ost week and to the s&p and the nasdaq futures you have the highest volume since going back to march 2020, and you also saw bank of america numbers today that did say that there was 17 billion of outflows for the first week of outflows in equities so people are panicking down there and you're seeing selling across the board as people chased the commodities up and they're liquidating and that will be a buying opportunity around the corner. >> thank you very much for explaining it to me. thank you very much. bill baruque we appreciate it. >> we have boeing, wells fargo and bausch health. not the beer, our trader will tell you whether to buy or sell.

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we're trading three big movers in today's three-stock lunch. boeing up 5% after the ceo, dave calhoun, told investors that the drip, drip, drip of bad news should stop soon wells fargo up 7% after a

positive stress test from the fed paves the way for banks to boost dividends. and bausch health companies jumping 17% on the heels of a c-suite shakeup. lee munson is portfolio wealth advisers president and ceo let's go through the stocks, lee, beginning with boeing, which just announced it's going to move to my hometown of arlington, virginia. >> you know, stranger things have happened, let me tell you boeing does have this drip, drip, drip i think it's going to stop here's what they have to do because they have already told us the supply chain is going to be a problem until the end of 2023 and it's baked into the price. but if they can get that certification, that little golden letter, the golden ticket that says the 777 x is ready to sell, i think it's a real game-changer because it's going to be a high-demand plane. but they had problems with the 787 and luckily the public doesn't remember the 737 max

crashes and that debacle so you have a company with one of the most complex supply chain issues that has ever occurred in any type of company here and we might see in 18 months that lift so i actually think that you've got 40, 50, 60% upside on boeing and maybe only about 20, 25% if they can't execute again, this is not about the moves, it's not about the drip, drip, drip, it's about can they deliver these planes the way that they have said and can they get certified on the 777-x i think they can i think you should consider it. >> let's turn to wells fargo then in the wake of these stress tests. what would you do with this one, lee? >> i've hated wells fargo for years. as somebody in the banking industry i felt very betrayed from the scandals six years ago. now we have the new sheriff in town, the new ceo that's been there three years. he's doing the right things. first of all, the stress test, of course they're going to do well if you have so many tickets you've got to drive ten miles

under the speed limit, of course you're not going to do risky loans. i want to buy banks right now. i think wells fargo can go back into a basket. things like jpmorgan, bank of america. these consent orders are starting to lift these are the handcuffs they have had with regulation and they started to get lifted last year they're going to be continued to be lifted off. regulators are easing back and the new ceo wants to get out of the mortgage business because you can't compete with non-banks and they want to do wealth management and credit cards and compete with the big boys. i think they can finally pull it off. if you're looking at a basket, i would start considering wells fargo, not a value trap anymore. >> and a quick final thought on bausch health company. >> what a dumpster fire. i mean, you know, it goes up because some guy who did a magic tr trick, john paulson, 14 years

ago. what has he done since then? they have a skin care thing, they want to spin it off they have the bausch and lomb. bad timing, didn't really work well i would look at this as a perfect opportunity to get out see what's going to happen this is a great stall. if your you're an arm chair wannabe hedge fund manager and looking for an overly complex, dodgy trade, i just don't see once they get rid of everything, their core business, this was valiant. people went to jail over this company. >> we've got to leave it there, but man, lee, love it, man stake in the grounding, man. lee munson, appreciate it. a deadline is looming in time for a potential port shutdown that could further weaken the supply chain. we have the details and what's at stake, next power e*trade gives you an award-winning mobile app

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your shipping manager left to “find themself.” leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire as if the supply chain didn't have enough problems, in one week the west coast ports that handle half the ships of this country is looking at a shutdown >> 45% of all container imports into the u.s. come through the west coast ports including the port of l.a. and long beach. in one week the contract between the union workers at those ports

expires. while both sides say they're committed to reaching a deal, the last three negotiations have seen stoppages and disruptions before there was a resolution. back in 2002, an 11-day stoppage, 2008 three weeks and 2014, slowdowns. another disruption could benefit some of the transport stocks evercore says the east coast rails and that includes csx and norfolk southern, they would benefit. remember in may ports in virginia and houston reported double-digit increases u.p.s. and fedex would benefit for increased demand for air shipping demand for ltl spiked during the port log jams earlier this year. freight forwarders, companies that move goods a variety of ways could benefit ch robinson is the biggest from asia to the u.s.

other include expediters and the hub group. >> frank holland. >> a key event to watch. >> well, the next hour, the most important hour of the trading day begins very shortly. it looks like we're going to go out with a big green week. >> 6% or so for the nasdaq, everybody. thanks for watching "power lnch." >> and "closing bell" starts right now. >> thank you, tyler and kelly. stocks are in rally mode we're actually at the session highs, up 700 points on the dow adding to a strong week of gains. the most important hour of trading does start right now welcome to "closing bell." i'm sara eisen here's where we standing in the market the s&p up 2.6%. it's a broad rally with every sector in the green right now. the nasdaq i2.7% the best performing sector at the moment is financials clean bill of health from the stress tests yesterday also a cyclical rally in general. materials, industrials, technology, that is what's