underperformance of the travel and reopening names. this was supposed to be their summer. >> i think the headaches and the travel crunch that's happening now may have an undermining effect on some of these names. >> definitely. and on the consumer. wallet, all the rest of it all right, everybody, thanks for watching "power lunch. >> "closing bell" starts right now. stocks are trading in a fairly narrow range following the s&p's best day in 2020 on friday the most important hour of trading starts now sara eisen is on assignment at the aspen ideas festival she'll join us in just a moment. here's where things stand in the market well, you can see the dow is down fractionally, s&p is down fractionally the nasdaq down about a half a percent. some days are a marathon, some are a sprint some are that friend who's walking the 5k and that's today. but check out action in energy that's a little more exciting.

by far the top performing sector as oil prices move higher. coming up on today's show, we are going to talk to to toni sacconaghi if it's the start of a broader rebound for apple. plus scott chronert just slashed his price target representing some nice upside into year ending he'll join us to break down that call let's begin with the aspen ideas festival which is where we'll find sara eisen. business leaders are gathering this week on a wide range of topics nbc universal news group is the media partner for the event. sara is there and has some color from what she has learned so far today. hey, sara. >> hi, jon good to see you. good to see everyone this is the first time aspen ideas has been in person in the last two years nbc again with the big partnership. so people are happy to be here some key topics among the

discussions include inflation and the economy. are we peaking on inflation? is the economy turning into a recession? roe v. wade, of course, where the country goes from here after that landmark ruling by the supreme court last week. the future of the workforce post-covid how much is going to be hybrid what employees are demanding and then climate, which is very interesting right now, to talk about fighting climate change on the energy front in particular because we're in a time needing fossil fuels desperately to reduce dependence on russia. john dorr on "squawk box" this morning, here's how they're thinking about it. >> i believe we are in an epic transition from a fossil fuel economy to a clean energy economy. it's the largest economic development of our lifetimes it ranks up with the internet in terms of its impact. >> so clearly clean energy is front and center for investments and certainly among the

conversations here we're here all week long talking to news makers tomorrow on "closing bell" we'll have intel's ceo pat gelsinger along with senator rob portman of ohio. a lot of intrigue about what's happening with their manufacturing planting after that ground-breaking ceremony was delayed. trying to put some pressure on congress to get the c.h.i.p.s. act passed we have a conversation about the housing market the ceo of hp and pepsico on how to run a business with purpose we'll also talk to jessica alba of the honest company. i just wrapped up a conversation with the ibm ceo about the future of work got some comments on what he is seeing on hiring right now, and big tech spending. i will bring it to you a little bit later on this hour. >> look forward to hearing that for sure

ibm has a huge workforce sara, thank you. now let's get to the market actions. last week's gains have many wondering have we reached a bottom or is more volatility on the way? those gains did not stop our next guest cutting his target to 4200 from 4700 joining us is scott chronert and mike santoli good to see you both scott, so this cut to 4200, it's sort of like you got a worst case scenario, a best case scenario this is somewhere in the middle. so how much is it going to fluctuate based on the data and indications that we get from here >> well, you know, so i think the issues at hand here, the old target, 4700, was a soft landing scenario, which is something we talked about on this program previously and, you know, it involved ending the year with a clear line of sight of growth and

improvement in 2023. given the uptake in terms of recession expectations, not a certainty at this point but certainly a growing possibility, we felt it more prudent to adjust that back so what we're incorporating now is let's call it a blend of a recession scenario, which in our view has been 3650, which is a line in the sand that we drew just a couple of weeks ago and a little bit more of a soft landing scenario that gets us to 4200, which by the way also aligns with roughly 18 to 19 times where we think earnings for the s&p 500 will wrap up this year, right around the $226 level. >> mike, that still feels to me like a very nice scenario, where we endi up higher from here we just violated some levels a few days ago around 3850

there was the risk we were going down to 3500 suppose lead and getting all these warnings it's going to be choppy through the summer there are going to be bear market rallies here we are, low volume day. should we be optimistic? >> i think you should at least say we're retaining last week's bounce for the most part well off the lows. interestingly, scott's kind of mild recession scenario at 3650 is basically where the low was 3666 was the low on the s&p 500 on a closing basis so i think you can have a lot of people saying we discounted a lot. not necessarily all the bad. what's fascinating today is the market indicated a little higher, and then we got pretty decent durable goods and pretty good pending home sales numbers. we're grasping at secondary clues for what the trade-off is going to be between economic slowdown and whether we can see the end of what the fed is going to do. the market is struggling with that day by day even when there's not a decisive data

point to hinge an outlook on. >> scott, what about politics? what about midterms? so often there's the discussion if one party gains too much power, that's bad for the markets or maybe good, i don't know how much did what happened in washington last week change the calculus on the outcome for midterms and does that matter at all for these markets? >> you know, i haven't really gone down that path at this point. i think it's a secondary issue at this point. i really think when you think of the way this year has unfolded, and let's just kind of set the stage on this, we've talked about this you had a major valuation correction mainly on the growth side of the market that's been a function of the ongoing step-up in fed commentary with many economists out there now projecting fed funds approaching 4%, even higher than that and so the market has been in the grips of the valuation

correction, affected mainly on the growth side of the market. the value side of the market hasn't been so impacted thus far. so what we're trying to focus our view on is that from here earnings growth drivers become an important part of this equation at the same time, any signs of the earlier comment on a relief in the magnitude of fed hawkishness can benefit the growth side. i don't think it's the driver that we're thinking of in terms for the market setting up for a little better price action between here and year ending. >> mike, as long as we've got low summer volumes, is it telling us anything serious? >> i think it's okay to actually take it on face value, mostly because the market has been under so much stress you had a tremendous amount of liquidation that happened near the lows so i think if the market is able to relax, if you can get one of these tension release episodes, that's an indication itself even

though it's not telling you we're going way higher we still caught the low that would imply this is proving itself to be more than just another relief rally because that's the trap we've been in. you get a bunch of these 5 or 10% bounces and they have always been short-lived and rolled back over we're still short of that testing ground i would say 4100 is where we're looking on the s&p. >> okay. maybe a little melatonin for the market can't hurt. scott, thank you after the break, apple is coming off a strong week of gains but still down about 20% for the year we're going to talk to top stock analyst toni sacconaghi about where he sees it going next and his analysis of apple tv plus. you're watching "closing bell" on cnbc. - common percy! - yeah let's go! on a trip. book with priceline. you save more, so you can “woooo” more.

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get a great offer on internet and security, now with more speed and more bandwidth. plus find out how to get up to a $650 prepaid card with a qualifying bundle. it's team for mike santoli's dashboard. he's looking at tech. >> tech is still pretty top heavy as you'd imagine we're looking at the forward price-to-earnings ratio for apple, microsoft and the equal-weighted version of the tech sector of the s&p so all stocks counted the same both of these guys, 22, 24 times earnings apple and microsoft together are more than 45% of the market cap of tech. you level that out, equal weighted, you're at 16 times earnings so it gets to that idea that the fair amount of the payback from the valuation excesses we got into maybe is done at least with the average tech stock out there

this is relative to the s&p 500. you're about at equal weighted, which is 14 times earnings but microsoft hasn't given back a lot of that premium and neither has apple. maybe it makes sense, maybe they're defensive and good ports in this storm. but it shows you the story is not necessarily fully told by looking at the overall tech sector and saying still looks expensive and more to go on the downside >> if they were to fall, would they fall in isolation or everything else in tech freak out? >> most likely it would not be isolated to them even if it's mostly a catch-down move by those stocks that have held up better. for more on tech and specifically apple, let's bring in toni saccagnoghi.

why do they deserve better than a market multiple, or do they? >> i think in general, jon, that they do. platforms lead to increased stickiness and often lead to recurring revenue and so that type of subscription or recurring type of customer or ability to expand an addressable market through additional products or services is something investors are willing to pay for i will say it's important to understand whether the businesses are transactional and/or how much of the business might be recurring in revenue and profit in apple's case they have a very strong ecosystem, their customers are very loyal most of their revenue is generated from product sales and that's generated largely by loyal customers. if you get in a recession, customers can delay purchases

and delay upgrades and so that revenue stream isn't exactly recurring, it's largely transactional. so it really depends on what the underlying business model is behind these strong franchises in microsoft's case, there are a lot of software licenses or subscriptions that corporations have committed to and are more difficult to get back during an economic downturn. >> i think that's a great intro to talking about apple tv plus because you break down sort of the value of that to apple, how investors should think about it. apparently on paper it's costing apple more than they're getting back, but isn't that kind of like trying to assign an economic value to getting flowers for my wife? like what do i get, right, in return >> sure. so you're right. we estimate that apple might be losing about a billion dollars a year from an accounting perspective on apple tv plus i think with many of their

services, apple takes the long view and ultimately over time this will contribute to profits. but it also enhances the ecosystem. and i think perhaps most importantly it's something that can be bundled with other products and services going forward. the cost of apple tv is largely fixed, you're paying for the programs so if you chose to give that away for free, for instance, as part of a services bundle, which it could do, or as part of a hardware bundle, that could be very attractive in attracting or getting consumers to upgrade more frequently. and so i think there's a strategic element to it as well, jon. >> but isn't there also a defensive element to it. if you're an investor shouldn't you think what's the cost to apple of not doing apple tv. if microsoft, if amazon, et cetera, were able to build up an

ecosystem and able to come out with a virtual reality headset or phone or whatever it is and challenge apple, since content is so valuable, wouldn't that be bad? >> well, i think that's arguably debatable because apple is making the apple tv plus content available on other platforms so if you have a web browser, you can still access apple tv p plus you can do that from an android phone or other televisions it's not unique to apple per se. similarly if you're an apple device user, you can still subscribe to amazon prime or other services so i don't think it's essential in that it creates a lock-in per se because most of the streaming services or almost all of them are available effectively to whomever wants it. i think apple is doing this because it can be a profitable revenue stream over time it has a subscription element,

whereas apple's business is largely transactional and the market values subscriptions at a higher multiple than it does transactional businesses. >> all right great analysis toni, thank you. >> thanks, jon. now a market flash on robinhood. steve kovach has the details. >> robinhood shares are surging about 14% on the report that the crypto exchange wants to buy robinhood. it's not saying it made an offer, they're just thinking internally about how they could buy the company. keep in mind the firm separately had a 7.6% stake in robinhood so he already has a big chunk of the company and it looks like he's finding a way to buy the rest of it back to you, jon. >> i know you don't necessarily focus on the crypto space all the time, but there are a lot of crypto assets looking for other things to buy besides crypto. >> yeah.

you've also got to look at this. you've got to think that bankman-fried smells blood in the water with all these crypto companies just in pain with the volatility we've seen in crypto so they have become good acquisition targets. we've seen the moves giving loans to these companies that can give them an option to be acquired later on down the road and now we're seeing it full out here with robinhood. >> you've got to be careful about crypto lending. >> exactly. >> steve, thanks let's check on the markets meanwhile. the dow is still down fractionally you can almost call it flat. down just 41 points. s&p down also just fractionally. and the nasdaq down about half a percent. russell is slightly in the green. we'll have much more on this robinhood news and the stock move ahead on the show now as we head to break, you can check out some of today's top searched tickers on cnbc.com the 10-year yield is on top.

it's that kind of day, followed az tesla, s&p 500, apple and amon "closing bell" will be right back

welcome back let's check out today's stealth mover. old dominion, lthe trucking company one of the best performers after wells fargo upgraded the stock to overweight from equal weight, hiked its price target citing increased confidence in old dominion's growth opportunity in the less than truckload freight market. it was up as high as 266 today but it's given up a little bit of of those gains. up next, ibm's ceo weighs in on whether companies are cutting back enterprise tech spending with fears of a recession on the horizon. "closing bell" will be right back

welcome back business leaders are gathering all week at the aspen ideas festival nbc universal news group is the media partner for the event. sara eisen is there and just moderated a panel with ibm's ceo. sara. >> hi, jon i hosted a session on the future of the workforce with ibm's ceo. we talked about all the changes

that have come from the pandemic he said at the moment only 20% of his u.s. employees are at the office for three days a week or more and he doesn't see a scenario where they get back to 60% in the office ever remember, this is a company that has 250,000 employees globally we also talked about how hard it is right now to find workers and how inflation and the labor shortage is pushing wages higher listen >> i think if you're going to get an adjustment in wages, we can see that in the past year, i suspect that we will see a decrease in the growth rate so it will step down. i look at inflation, right now, what, 9% give or take? >> almost. >> i think it will come down by the end of the year or maybe next year. i don't think it will come down to 2. >> that's what the fed wants. >> the fed has put 2 out there as its target. >> so you think we're in for a lot more interest rate hikes and issues >> i think we're in for a period

of more sustained inflation than 2% i think the 2% may come back in three years, four years. but ike we are going to be above that from now until the end of next year. >> so you think we're going to have high inflation with a recession? >> i am one of the more optimistic people. how do you really get recession with full employment not only will you get high interest rates and high inflation, you also tend to get employment building up and that's what everybody -- that's the hard landing piece, right? so right now if you have 6 million, 9 million fewer people here than we would like, that means effectively the unemployment part has been taken care of. >> you can have a sharp consumer spending slowdown. >> you could will it really cause recession or a gdp slowdown.

that's the interesting question. >> are you seeing a slowdown in tech spending, in the tech environment? >> not in the b2b space. if you do more automation in your warehouse, do more in supply chain resiliency or less. if you're in pharmacy, you worry about how do you distribute drugs better or worse. if you're in biotech are you going to worry about how do you do your next four vaccines to come out faster or slower? if you're going into banking, are you going to do more personalization around loans or less so if you look at it, technology is real different. the same way as you go through these, 1700s roughly, i'm not a historian so hold with me if i'm off by a century the industrial revolution. i can bring the power to the factory as opposed to the factory has to sit over the

river and float logs down using gravity and water. you can go toward then to steam which was railways and steamships which was the a1800s. we saw the rise of the western powers you can go to oil and that led to mobility as an automobile you can separate and not have to be as polluting at coal. fast forward to today in terms of technology, which is why so much angst around semi conductors i would say that these things have shown they improve human productivity, improve the quality of life and the nature of work changes and ties back to these. so the nature of work keeps changing. >> we also talked about some of the cracks that are forming in the technology industry at the moment layoffs we've seen, for instance, at netflix, robinhood and a number of crypto firms he said it's mostly the unprofitable tech companies, but that those companies do have the potential to turn profitable at lower valuations it's very different if you're trading at five times sales than

if you go bankrupt so they need to position for the long term. perhaps a reason why ibm for its part is handily outperforming the market this year the stockes up 7% while the zs& 500 is down 20 i asked about the supreme court's ruling overturning roe v. wade and what he's doing for his employees. >> we don't want to become a political hot potato so we're not going to make any big public statements that said, we're always about giving our employees choice and protecting our employees i'll give you two examples ibm employed women at equal pay in the 1930s we had our fist women executives in the 1930s we had our first black executive in the 1940s in both cases the women had men working for them and the black executive had non-black people working would him. we gave the same-sex benefits in

1994, i believe. a good 10, 15 years before same-sex marriage got legalized. >> just because you've always had leaders -- >> we want to do this for our employees. i'm not sure that we want to make this into becoming the hot button for politicians politicians will do what they need to do i do encourage our legislature to get its act together because that is where the answer lies. so we will do what we can to protect our employees but we're not looking out there to creat it it's a deeply personal issue these are deeply personal to many people. when you listen to both sides, you do realize that forget is it exactly equal or is it not there's a lot of emotion and fact on both sides. >> that's what i was going to ask, how do you determine as ceo and as a business whether to weigh in on a political issue? because businesses have struggled. we saw disney and the debalk

nell florida we've seen coca-cola and the voting rights in georgia how do you determine which issue to stand up for? >> for example, one we did take on was the bathroom bills that north carolina and texas were after three, four, five years ago, somewhere in that neighborhood we did say that we would have to think about where our employees and future employees are on that basis. that's the only power that companies have we do not give any money we do not give any money to politicians directly not to pacs, not to anything we do speak up on policy issues but we don't have a checkbook we can use. but we do have employees. >> do your employees want you to speak up >> some employees do so we took those because we thought that is the vast majority if you look at those two bills, for example. so we did speak up where it is much more divided, you've got to let the political

and the judicial system carry its course out i actually do strongly believe companies and corporations should not try to replace those. certainly our voice should be heard so we're willing to make our voice heard, but voice is through actions as much as everything else. what do we actually do for our employees. and then if they would prefer employers like us, it will speak for itself. >> good thinking into the window of the thinking of a ceo as to whether to make a public statement coming out against something like what we saw from the supreme court or for it. instead he said it's too divisive it's too political and too emotional on both sides. therefore, not a place for ibm to speak up. of course they are, like so many other companies we've been covering going to offer the protection via insurance for employees to have reproduct i've rights and go to other states if they have to travel for abortions. that's just the way one company is thinking about it but clearly that has made it to the very top

of th of the agenda here at aspen ideas. >> and isn't that the ultimate public statement, sara, is not only your policy but your historical policy and culture. i mean people can tweet whatever they want in a given day but is that still going to be the company's policy five, ten years from now when leadership is different ibm has a bit of a track record. it's also interesting to me the context of ibm's statements, whether it's about social issues or it's the stock in this down market ibm's performance, which you mentioned, doesn't look so bad and that 4.6% dividend yield doesn't look so bad either. >> the fact that they have strong cash flow and they're a profitable company they're a turn-around story and seen as a value play which has worked better in this market environment.

i know you've talked to him about this as well he is really focused on changing the culture of ibm it's a big ship to steer with hundreds of thousands of employees, but wants to make them faster, wants to make them more competitive in what he calls the hybrid cloud, which obviously he sees as a big growth area. and in places like blockchain as well he said that the workforce is top three challenges and issues that he thinks about number one it's the challenge in russia and the lost business there and what they're doing with employees number two, the competition which he looks at and he mentioned walmart trying to do their own cloud business as well and three, on the workforce, which is clearly a big issue right now, especially with the acute labor shortage. >> yeah, it's great that you spoke with him, sara he makes a really interesting point about those quarter million employees that he's got, many of them technical in the consulting business. he's saying that in a pressured labor environment, he's got the

technical workforce that others need so in a way it's good for him. we'll see if that pans out and plays out in the stock sara, great stuff on your own show, of course. sara eisen in aspen. thanks for having me. >> thanks, jon. coming up, we will talk about the report that sam bankman-fried's ftx has a pathway to buy robinhood that stock is higher and an analyst will weigh in on what arolrsove would mean for shehde "closing bell" will be right back you see it's up 15%. ♪ ♪ jerry, you've got to see this. seen it. trust me, after 15 walks it gets a little old. i really should be retired by now. wish i'd invested when i had the chance... to the moon! [golf ball bounces off rover] unbelievable. ugh. [ding]

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welcome back home builders outperforming the broader market today after a surprising increase in pending home sales

diana olick has the details. >> hey, jon. yeah, it's also surprising builders would get a boost from this may reading given that several have already reported that the biggest slowdowns in home sales began in june that said, pending home sales rose very slightly, up 0.7% compared to april. that beat expectations of a 4% drop and broke a six-month streak of dleclines. sales still down nearly 14% from last year. this measures signed contracts on existing homes, so shoppers out in the market in may when rates came down very slightly after rising since the start of the year of course they then shot back up in june. more supply also came on the market in may. but even the realtors chief economist said may's reading is likely a blip in a down turn in demand due to higher rates. up next, josh brown on today's volatility and whether last week's rally was a head fake that story, plus a potential deal for robinhood when we te ak

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with powerful, easy-to-use tools power e*trade makes complex trading easier react to fast-moving markets with dynamic charting and a futures ladder that lets you place, flatten, or reverse orders so you won't miss an opportunity if you unlock a door with a key of imagination, you are in the market zone. josh brown is here to break down these crucial moments of the trading day, plus dan dolav on robinhood and leslie picker on the banks. let's again with the market. stocks trading in a fairly tight range today following last week's rally josh, not a lot of volatility to trade, but what's on your mind what are you paying attention to

with today's action? >> listen, i think all rallies are still guilty until proven innocent we are still very far below the major moving averages. on the dow, on the s&p, on the nasdaq but a lot of damage has already been done so we're kind of in a no man's land. i think you probably don't want to get too excited every time we have a one-day wonder rally like we did on friday, but the fact that we didn't get half or more of it back today i still think you'd have to say is a victory for the bulls. so trying to remain somewhat optimistic while not getting sucked into all the enthusiasm just because we have one green day out of the five. >> a lot of traders getting their ankles broken in this market speaking of, robinhood getting a late pop on a report saying same bankman-fried's ftx seeking a

way to buy the company dan, robin hhood is up 17% right now. what does that say about the chance of this hatching and about a bunch of these growth stocks that have been beaten down >> i mean, look, it's surprising and it's not surprising because it just shows you that we've always said and you remember we've always talked about it, how great of a business robinhood is and there's going to be -- ftx, i don't know i saw the news they denied talking m & a but there's going to be a lot of suitors for this business it's a fantastic business with amazing movement they captured a generation if it's not them, someone else is going to be interested. so i'm not surprised i think the stock is going up and this is a great business for the overall space to answer your question there's goingto be more activity in this space given the valuations right now. >> josh, great business? people were talking about a great business -- >> why is it a great business?

no, sam bankman-fried is very smart. the book value is 7 billion. they have cash on the books of like 6 billion so basically they can almost buy this company for free, assuming they're not about to pay a 40 or 50% premium. one of the things sam has done at ftx that coinbase didn't do correctly, robinhood didn't do correctly, he recognized there's no need to hire hundreds of engineers in the middle of a bubble so he's only got a couple of dozen engineers at ftx and he is competing with companies that have hundreds of them. i think immediately he takes some of the costs out of robinhood. but i still fail to see how this is a great business. the average user has $240 in their robinhood account. the amount they make per user is declining, has been declining quarter after quarter. and their user growth has now gone negative.

they are net losing customers. i'm not sure what's great about this other than if the curve steepens, there is some net interest from cash balances. whalgs are they doing here right? >> dan, weigh in on this there's all this talk about robinhood democratizing the markets, which i thought etrade did a generation ago if there is very little cash on average in customer accounts right now and if all of this rah-rah options trading is going away, why is this business good? >> and i want to push back on this one i think those are great points, but it's very easy to make these points on the back of the best year equities has ever had, which is 2021. so everything in relation to last year looks awful. and the way we look at it is basically what is the second and third derivative doing if you look at the numbers, a lot of these things that you

mentioned, josh, they're bottoming, they're troughing so the decline in the users is actually getting slower. the decline in the rpu is not that bad so it's coming off a huge mountain of last year and getting normalized remember, everything that went up goes down you'll see that the engagement, people on rob inhood use the app more than on any other app and that is very valuable. you cannot get it unless you have it, right it's a very valuable asset they really reinvented trading and i think they're getting that generation early on. we look at it like in a five-year time horizon and i think it's very smart what's happening today, i agree with that. >> josh, in a way isn't this a microcosm of the market? have we gotten too negative on the market in general, not believing last week's rally perhaps and we were in this pause moment of being able to consider what to do the rest of the week have we gotten too negative on

robinhood, is it possible? >> no. if you paid attention to what was revealed during the hearings, the best week robinhood ever had was also its worst week because they did not have the net capital in place to facilitate the level of volume during the gamestop trading frenzy thank god for robinhood that immediately following the gamestop and amc meme cresting, they had dogecoin come along but this is a company that has only ever gotten close to being profitable during months and quarters where there was a horrific investment bubble that was soon to rip out the lungs and hearts of the people that played along with it it's literally a firm that rides along bouncing on top of bubbles. so you will right that this is a great business if and when we have the next speculative fever or bubble in the market, because

robinhood will push as many of its users as it can via the user interface and all kinds of other tricks within the app to take part in that bubble. but bubbles blow in the aftermath, you end up with what we have now, which is literally millions of teenagers and recently teenagers sitting with a couple of hundred bucks worth of blown-up options trades and margin balances. and that honestly does not look like a great investment business you can buy sochwab right now, you can buy goldman sachs. these are great businesses this is really something that's very cyclical and needs a mania in order to make a lot of money. >> it sounds like you don't like it still dan, thank you >> just being honest >> hey, that's what we love. people don't have to guess big banks are expected, meanwhile, to announce their dividend and buyback plans after

the bell following last week's stress tests leslie picker joins us leslie, what are we expecting from the major firms this time >> hey, jon. so it was a markedly more difficult test for the banks this year, which resulted in what's known as a higher stress capital buffer that is something that indicates how much banks can return either in buybacks or dividends the higher the scb, the lower the amount of buybacks and dividends they can return to shareholders so a lot of analysts are expecting at least among the big fi firms, you can see there is expected to be a materially lower amount of buybacks this year compared to last year that's largely due to their performance on the stress test and the expectation that perhaps some of these ceos will wanting to preserve capital and maintain a more conservative balance sheet in advance of any

financial downturn or severe recession. >> leslie, thank you also after the bell, nike's fourth quarter results coming out in about 15 minutes. analysts have been lowering estimates for this quarter, coming down more than 5% sara eisen back with a preview sara, you could be in a nike-type setting right now out there in colorado, very outdoor appropriate. >> not quite in beaverton, oregon, but i'm closer so nike stock has come down more than 30% this year it's worse than the overall market and even worse than the ert. here are three things to watch china. nike relies on china for more than 20% of sales but it has been the growth driver for this company. lately, first it was nationalist ce sentiment and now covid lockdowns which have hurt the business and the entire growth story. citigroup analysts found more than half of respondents in

china saying the athletic category was more promotional lately number two issue, the strong dollar we've seen the strong dollar has cut into sales and profits at salesforce and microsoft those headwinds have increased and nike is a very global company with more than half of its sales coming from overseas. and finally, north america, the supply chain issues and shipping problems have hurt nike's business here in its home product in the u.s it couldn't get enough product out to stores and on shelves and to customers has that improved? you'll see that show up in the north american business. also, john, keep an eye on direct sales sales in its own stores, its sites, that's where they have revved up the growth and should be a good indication of brand strength overall if that holds up amid some of these macro issues, like china and foreign exchange. >> lrtdall right, sara, thanks.

josh, how much of the bad news is priced in >> look, i think we can say that a lot of the bad news has priced in in the technology sector. the problem with that is those are always going to be high beta stocks so even if we get to a point where you sayto yourself, okay this is the cheapest i've been able to buy this particular software company in three years, it doesn't mean that that valuation or that discount is going to give you the cover that you need to feel good about taking a position. so i would tell people act as if it's a bottom, not the bottom. the worst case scenario is you'll wish you bought more. but i think that that's a much better thing to have regrets over than making all-in bets at this stage of the game i think we're still in a technical no man's land and these things tending to take a little bit of time to work themselves out. >> so clearly not robinhood but

some of the quality names worth playing? >> yeah, jon if you go back and look at the last few major market bottoms, let's say just over the last 20, 25 years, you can always find large cap, well-known stocks that had bottomed well in advance over the overall market. amazon is a classic example of that and we can find companies today that may have seen their worst levels we'll only know definitively whether that's true on a case-by-case basis if we look back a year or two years from now. but i think it's reasonable to assume there are companies where their share price has more than discounted the challenging environment and has done going down. >> well, speaking of, josh, thank you. we are heading into the closing bell right now with the nasdaq near the lows. it's down almost a full percent. the s&p and dow still just down

fractionally they have been in about that range all day. the dow looks to be down around 70, 80 points. the s&p off about a third of a percent. meanwhile, you've got all of that but the russell had been performing better than those all day. it ends up fractionally. and with that, i'll turn it over to mike santoli in "overtime." >> thank you, jon. welcome to "overtime." i'm mike santoli in for scott wapner you just heard that we're just getting started. in moments we'll get earnings from nike. we'll get that plus instant reaction plus breaking news from the banks. they're expecting to announce their capital allocation plans after breezing through last week's stress tests. but we start with our talk of the tape. a bear bounce or a bottom? stocks taking a breather today after last week'