>> yeah, exactly. >> eva, thank you very much. >> i guess they don't fly into london heathrow. >> right i understand there's that much demand, but there's still a lot of bottlenecks crazy. >> and sas is on strike. i was planning to go to norway, who knows, we'lly. >> forget that. >> thanks for watching "power lunch. >> "closing bell" starts right now. stocks are searching for direction in another choppy day of trading as investors await tomorrow's big inflation report. the most important hour of trading starts now welcome, everyone, to "closing bell." i'm sara eisen the dow is down about 45 points or so. we've been in a range of up 172 at the highs and down 93 at the lows s&p 500 giving up half a percent. you've got strength in materials, consumer and some real weakness in energy stocks as crude oil sells off hard. health care, technology and real estate

the nasdaq down a little more than half a percent. small caps just barely positive. there is crude oil brent closing below -- settling below $100 a barrel for the first time in three months check out our chart of the day it is the euro against the u.s. dollar hitting parity overnight for the first time since 2002. according to cnbc data, that is one euro to one u.s. dollar. on the plus side it helps us fight inflation. double-edged sword. coming up, carson block out with a brand new short idea today and he is joining us first on "closing bell" to discuss it. it's an esg play called hannon armstrong and it is getting crushed on today's report, almost 17% he will join us to make his case let's go straight, though, into tech it's been a volatile session for the nasdaq, just like the rest of the year. our next guest says most growth stocks, tech stocks that is, bottomed in may and could become big cash gushers a couple of years from now

let's bring in eric jackson. eric, are you here to make a case for unprofitable growth tech companies >> well, sara, the best performing tech stocks, growth tech stocks over the last 40 years have always been big cash generators but we get caught up in talking a lot about profitless tech. you know, i think what goes unnoticed is that many companies which might be profitless today are potentially one or two years away from becoming and joining the ranks of big cash gushers. so you've got to pick your spots. but the big opportunities are looking for companies that are just on the verge of becoming free cash flow positive. and then obviously accelerating over time. those are where the real opportunities are. so don't get scared away from profitless tech.

>> well, i'm curious who you're talking about, because a lot of the names that you like right now have been absolutely hammered and it's because they're profitless and because they have sort of future stories and their valuations just got out of control. >> well, i mean i'll get into a couple of naemz i like, sara, uber and lyft. people think of those as the poster children for broken business models. we've given up on them they got obliterated over the last couple of months when lyft announced some driver subsidies. and yet both of these companies for the remainder of this year are supposed to generate cash from operations and also be free cash flow positive so for the year uber will be free cash flow positive. next year uber is going to be free cash flow positive even if you minus out stock-based compensation so when things like that happen in businesses like that, you obviously get a big re-rating of

the multiple associated with those companies. so those are two quick examples of companies which i own and which i think could be on the cusp of a big turn in their prospects. >> but what happens to those companies in recessionary periods? we haven't really seen it before >> well, one of the things i had a twitter thread about over the weekend is that it's really challenging in growth tech because the end of recessionary events over the last 40 years is pretty limited most of the time we default to the dotcom era or the great financial crisis but those are obviously very particular special one-time events i've been more interested in going back and looking at the 1990 recession, which has a lot of similarities with what we've just gone through, especially over the raft seven months in growth tech. back in 1990 you were obviously coming into a big recession that

really didn't bottom until the end of 1990 and the fed got looser in early '91, which perhaps we are a few months away from happening again and so you saw some growth tech companies just get wrecked in 1990 oracle was down 80% in seven months and finally bottomed in october of 1990. adobe, which was a new growth tech company at the time was down 65% and yet when things turned, and they turned for these growth tech names first before these other bigger s&p 500 type companies, the rebound was almost just as quick back upwards. a truly v-shaped type curve. in growth tech right now most people don't realize it because the faang stocks covered it up last year. most have been in recession for the last 18 months so the degree of drops in these companies, the magnitude of the drop and the length of time that

this has gone on is truly, you know, sort of beyond the norm. so -- and you can argue -- >> it feels like that. >> -- that they got carried away in covid and all the rest. but i think the timing is right and both of these stocks bottomed in mid-may. we could see a very strong powerful comeback in the second half of this year. >> uber and lyft are in one sort of category, eric, but i wanted to talk about some of the other names that you were long including carvana which a lot of people think is a zombie company. needs to raise debt or equity or else run out of cash and the markets are not too friendly for that this is a company that's trading like it's going out of business. where's the value there? >> and it might. it's quite possible it might i own some it's a very small position for me and one thing i don't like about carvana which makes me look at it with definitely a more skeptical eye versus an uber or

lyft or opendoor, for example, which some people say is a zombie company too. >> wait, open door, it's unprofitable, tied to the housing market, it's everything that investors don't want right now. >> and that's exactly why you should look at it, sara. it was something like $36 in february of 2021 it was $4, $5 -- it's $5 today, $4 a few days ago. this is exactly why you should be looking at it that one has been free cash flow positive the last couple of quarters i think it's a misunderstood business model but to come back to carvana, the problem with carvana is they never have generated cash in a quarter since they have been a public company from operations, let alone free cash flow they promised to do that because obviously all growth tech companies have to bow down to wall street and promise that they're going to turn things around and they have cut head count and all the rest

i do think there's something there in their business model. but it's a bit of a show-me story. but if they can't turn it around, i mean this stock went from $390 in august of last year to $20 today if they can turn it around in a couple of quarters, it could be a powerful gainer. >> like some of the most hated stocks, eric, thank you for joining me to talk about it. i know you like ark innovation as well. similar arguments there. that etf is working today, up 1.6%. we have taken a leg lower in the market the dow down 135 or so, so it dropped about 100 points in the last few seconds as we kick off this final hour of trading lightspeed just announcing a raise of more than $7 billion for a range of new funds, including a crypto-focused project. we'll talk to one of their partners about the kinds of companies he is looking to bet on with that new money, next you're watching "closing bell" on cnbc.

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check out today's stealth mover. it's pricesmart. shares fell after missing estimates because of supply chain issues and excess inventory levels that stock down 9% meantime, venture capital from lightspeed announcing today it raised more than $7 billion to fund early stage companies around the globe it includes companies like affirm, ftx and snap joining us is bejul.

it's great to have you on the show how did you do that, raising that money in this year's volatile environment >> thanks, sara. i think it's a reflection of the firm's performance and track record over time this wasn't something that happened overnight i think we're fortunate to have the support of an incredible set of limited partners who have seen the firm over multiple fund cycles and hopefully we'll reward that support with some good performance over the coming decade >> so clearly capital isn't a problem, but what about deals? >> well, i think in all of these areas, including an eventual landscape, the sense we have is that there will be a flight to quality. and so i think we'll see the very best companies, for example, as the very best funds perhaps benefit from an environment like this. but marginal companies struggle. in terms of the -- in terms of the environment right now, i

think it's a little bit of a mixed bag. growth obviously, the late stage privaties market is in a very tough spot not fully adjusted because a whole bunch of companies raised capital last year and don't need to come back to the markets. i think early stage continues to tick along there's still a lot of teams building for the next seven to ten years. and so we're continuing to see some pretty compelling opportunities there. >> what about -- i wanted to ask about buy now, pay later specifically i don't know if you're in klarna but that's the story of the week the valuation, $6.7 billion. this was a company valued at $45.6 billion a year ago 85% cut. so these down rounds are happening. what does that say about the space? >> yeah, sara, i think this is -- if there's a company that is out and has to raise capital

right now, it's really ugly. and i think that's a reflection. there's a lot of companies, as i mentioned, that don't have to right now and that's what in a sense is going to cause -- you know, cause the markets to take some time to adjust. i think, look, we've been through -- we've been through downturns, severe downturns before, post the dotcom phase. not as severe and perhaps not as long lasting in 2008 those were really times when some very compelling companies were born and those were good times to invest but also times when firms had to really steward their existing portfolios carefully. >> so one of the opportunities i think where you see value is crypto that's one of the vehicles that part of the fund-raising today where is the value in crypto right now and do you think we've

seen the worst of the carnage in some of these prices like a bitcoin or brokers that have gone bankrupt and not returned cash to shareholders >> yeah, sara. i think from our perspective, our effort around crypto is really focused more on the underlying technology, applications of that technology, underlying infrastructure. again, our view is very long term on this when the firm started investing internationally in the early 2000s, the question was, gosh, is there really venture capital outside the united states? and it wasn't entirely clear then i think with respect to crypto we continue to believe that there will be very exciting, very compelling applications of the technology and that actually over the next couple of years will be a good time to invest and build patiently because a lot of the tourist capital and a lot of the fomo-induced interest is out of the market, reflecting

in the price corrections that we've seen from a new investment perspective if you have conviction around the underlying technology, we think it will be a good time to be sensible and put some capital to work. >> bejul, thank you for joining me today to talk private markets, appreciate it take a look, with 43 minutes left of trading, the dow is down 150. the s&p 500 continuing to lose steam, down almost a full percent. remember, we dropped more than 1.2% yesterday so we're lower on the week by about 2% or so every sector has gone red, including those that were outperforming like materials and staples. they're still doing better and now energy at the bottom of the pack after the break we'll take a look at the relative performance of consumer staples and tech stocks and the premium being paid for predictability. te srtarr, carson block on his lastho tget in the esg space. we'll be right back.

today's big picture, the u.s. consumer still no recession signs, at least that was the message we got from pepsi earnings today sure, pepsi is a staple so it does well in good times and bad, but pepsi is doing really well and it's broad based 13% organic sales growth that was a beat. they lifted their full sales outlook to organic growth of 10% instead of 8%. it's not just higher prices driving this growth. volumes were up as well. i talked to hugh johnston, the cfo and vice chair, they're not seeing any change from consumers. no change in patterns. things like starbucks frappuccinos which pepsi does manufacture in bottles and at the low end like santita's chips. in restaurants, pepsi's business drew double digits there convenience stores up high single digits despite high gas prices

pepsi, like all companies right now, is raising prices or shrinking packaging. johnston told me he sees relatively low elasticity or pushback from consumers as a result of these price hikes and he thinks they're still benefitting from higher wages. as to whether the price hikes continue, johnston says it depends on whether the consumer continues to hold up so far despite all the hand wre wringing on wall street, at least one large consumer company isn't seeing it yet. mike, you're looking at the sector's performance. >> take a look at pepsi against microsoft. it tells a pretty good story of the last two years in this market microsoft, one of the reasons it was so valued is because of that perceived predictability of its results. it can grow in a secular way long term to all environments. microsoft got pretty hot, pretty

high momentum stock last year and it has surrendered alot of that and pepsi has nosed ahead take a look at the valuations of the equal weighted consumer staples sector of the s&p and equal weighted technology. here you saw this huge premium in consumer staples. this was coming off the recession scare and recession in early 2016 that's the last time that happened here you have it again just building a little bit. staples nosing ahead more expensive, therefore, more value. this is where tech obviously got ahead of itself. one final point i would make, at the absolute level of forward price earnings multiple is pretty much at the lower end of its range. >> i'm wondering where apple is on this chart, because it's often valued as a value. >> it's over 25 times or 25 times thereabouts right now. it is apple, microsoft, salesforces that do inflate the market cap weighted multiple

but on an equal weighted basis, not so much. >> all right, mike, thanks shares of renewable energy, firm hannon armstrong is plunging after carson block says that's his latest. why he things esg stands for exaggerating, scamming and grifting when it comes to this company. we'll be right back.

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one of the stock stories of the day, check out shares of hannon armstrong, a climate solutions investment firm and it's falling about 20% now this comes on the back of a short report out of muddy waters research titled esg is for exaggerating, scamming and grifting hannon armstrong just telling cnbc in a statement in reaction to this the report, which they put in quotes, by this deceptive short seller for which the justice department is investigating for suspected coordinated manipulative trading is an attempt to mislead and confuse the market the report is replete with factual errors and numerous inflammatory and misleading statements hannon armstrong's accounting is fully compliant and indicative of our performance we are proud of our long history of transparent disclosure and best-in-class accounting practices.

carson block of muddy waters research joins us now first on cnbc carson, great to have you. before we unpack that whole statement, for those not familiar with this company, how did it reach your desk how did you start looking into it and what did you find >> well, it's one of these -- so we have spent some time recently looking into these esg-type companies. and it's just one that seemed, first of all, on a valuation basis, even if you forget about the -- how much of the income is actually noncash versus cash, it was just expensive and it's one of these things where it seemed a little bit too good to be true. we noticed that disclosures about their emis, so these are companies that they take minority investment stakes in, that the disclosures had declined significantly over the years. when we see something where a material part of the business, where the disclosures are declining, that always piques

our interest so we dug in and it took a lot of digging i mean when the company doesn't disclose much and you really had to go to a lot of different places so, for example, joint venture partners, their filings to understand what's going on at these investee emis. delaware ucc filings we spoke to formers, former employees, so we had to do a lot of digging and it took several months but it's a pretty extraordinary story. you know, just partly to address what they said, but the crazy thing is, i mean given the misrepresentation of, you know, cash, of noncash income as cash, i mean there's nothing that's illegal. that's just how crazy the -- >> you're saying -- sorry to interrupt. but you're saying that they're understating earnings. is that the bottom line, through

accounting >> well, they're basically -- so the main sin that this company commits, and this is not illegal, but there's very odd accounting that occurs with these renewable projects because you often have what's called a tax equity investor. and the tax equity investor is effectively investing in the tax credit so once they have used their tax credit, then there's this bulk value adjustment that occurs for the other investor in there. now, hase ends up -- it can choose to offset this. but it takes that book value adjustment, even though it's not hasi's tax credit and never got any cash from this cash equity investor, it takes this -- effectively their tax credit and runs it through as its own income so its emis are actually by and large losing significant amounts

of money so, for example, its largest emi bias sets, jupiter, last year lost $380 million. and it looks like hasi recorded income, noncash income from jupiter of about $200 million. so i want to rephrase that rather than taking a share of this $380 million loss, hasi through the magic of this special accounting that applies to renewable energy projects said, hmm, actually why don't we say that we got profit from this of $200 million. so that's really the core of what hasi does and this is cash -- it will never receive this cash. what it does is it reverses that income gradually over 20 years and so it's going to reverse that at about $10 million a year now, it also makes loans, especially to its emis that are

pretty stressed but rather than hasi saying, hey, these loans are actually not going well, they're recording interest income in the form of piks, paid in kind. that's basically the borrower saying we're having a tough time, here's an iou, here's an iou, here's an iou so it looks like hasi is receiving interest income, but it's just adding to what appears to be this unsustainable debt load that these becorrowers already have but on a cash flow statement it looks like hasi is receiving cash some of the loans that they are making to these companies, the company will take out a new loan and repay a previous loan so hasi can say, oh, look, our loan book is healthy, we're getting loan inflows but it's just recycling cash

so hasi is -- none of this is illegal but its accounting manipulation is so extreme and so divorced from reality that it reported $127 million in net income last year i mean we think that the real number, if you take out all of these manipulative forms of accounting, at our mid-point estimate, the real number should be a loss of $235 million. >> the stock is down 20% it's technical, carson, it's hard to explain on tv. we appreciate you trying to do so it's a 27-page report that you put out. the rebuttal from the company clearly is sharp and i did want to address something where they go after you and your reputation they call you a deceptive short seller for which the justice department is investigating for suspected coordinated manipulative trading we haven't really heard from you since those reports surfaced earlier in the year. can you tell us about where that stands >> sure.

let me say two things to that. number one, i've doing this 12 years and i could have written that response myself i've been joking for many years that it's like mad libs when companies issue their responses so everything they have said there is basically pro forma for 12 years over than the doj thing. so yeah, it's been reported that the doj has a wide-ranging investigation into short selling. you know, look, companies have been trying to sell regulators on this fantasy that we short sellers all get together and decide like, hey, let's go destroy this company it's complete bs ultimately that's what it's going to be shown to be. but i don't know, i call it my first amendment tax basically. that's what this is and that's all it's going to amount to. >> do you have any sense of where they are in this investigation? >> no. they don't really talk to us but i'm not -- i'm not expecting

it to ever result in anything that becomes a problem for us other than the annoyance of dealing with it. >> my last question, carson, clearly you're shining a light on this company as an esg investor do you think there is other fraud, manipulation, i'm not sure whether this is or not, obviously, but is this an area that you are increasingly looking into there have been a lot of bold claims and a lot of love from wall street in this sector for a long time now. >> yeah, so listen, the answer is yes it's kind of amazing to me, and we also saw this with these government stimulus programs like ppp i mean there are a lot of people out there who the moment the government is offering money, the machinations their minds must go through to think about how to grab this money so given the significant subsidies that have been available for renewable projects, yeah, i mean there's -- i think there's a lot

of -- there's a lot of grifting there. there's a lot of grifting the government out of tax -- out of tax credits, and there's grifting investors as well, because there's been -- there's this robo bid for esg. everyone wants to pat themselves on the back through saving the planet for their investments and they have got this money that must flow into esg there are people that are bad actors and other management teams out there that are bad actors that are capitalizing on this besides hasi. so yeah, unfortunately -- and we've seen this in the vehicle space, right we reported on a company called xl fleet, that's supposed to be electric vehicles and that has blown up lordstown motors was greatly exaggerating its order book. and nikola rolled the truck down the hill the more i look at the space,

the more bad faith i see >> well, keep us posted on that, carson, on your next one this one certainly making waves. the stock down 20% or so carson block from muddy waters. here's where we stand over on the markets we just continue to move lower the dow is down almost 300 points, almost a full percent. the s&p down 1.3 oil prices raekweakening on recession yary fears. treasury yields are under pressure on similar concerns. up next, we'll discuss why airline stocks are soaring today and much more when we take you inside the market zone ♪ ♪ well would you look at that? ♪ ♪ jerry, you've got to see this.

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without ever wondering if you're getting the most out of your trip. because you are. power e*trade's easy-to-use tools like dynamic charting and risk-reward analysis help make trading feel effortless and its customizable scans with social sentiment help you find and unlock opportunities in the market 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 we are now in the "closing bell" market zone. cnbc senior markets commentator mike santoli here as always,

plus we've got pippa stevens on a rough day for energy stocks and oil prices, samira pandez. we are getting a late day swoon and the major averages are near session lows mike, we're seeing treasury yields falling, oil prices falling, the dollar rising it's ugly action ahead of cpi what's causing it? >> pretty listless in equities with all of that going on most of the day there was a pretty sloppy crude oil close around 2:30, kind of a weak 10-year treasury auction that's kacaused a blip up in yields very low conviction options expiration week. it seems we were trying to hang around 3850 on the s&p 500 that's one of those index strikes. that's the down 20% level from the all-time highs once we got a little bit of pressure, we clung down to 3800. so the next round number, i'm

not sure if it's anything beyond that but illiquid markets. >> the nasdaq is underperforming the s&p 500. we've seen some outperformance lately on some dip buyers but not the case today let's hit energy because it's the worst performing sector on wall street today. slide in crude oil prices. wti falling below $100 a barrel. it's below $96 right now pippa stevens joins us pippa, what is driving this big decline today? >> yeah, it was a really ugly day for oil. wti fell 8% and is just barely above its 200-day moving average of 95.35 it hasn't dipped below that level since december there area number of factors fueling this decline of course we've got the spike in covid cases in china we've also got the stronger dollar as well as recession fears. meantime, thin liquidity can lead to exacerbated price moves. traders, their net long

positions in wti have fallen by nearly 30 p% in the last few wek and are now at their lowest in two years. this all comes ahead of president biden's trip to the middle east and rebecca babbin saying there isn't any risk appetite to buy this dip ahead of his trip. turning to the impact on energy stocks, we talked with the technical levels on the xle last week you can see there was a slight bounce off that level but the sector has retested that 200-day moving average matt nailey saying if it falls significantly below that level it will throw into question the uptrend the sector has been in for basically the past two years. >> pippa stevens, thank you. mike, i feel like we're in a short term versus long term situation with oil prices right now. short term there are worries about covid and the economy really slowing down, especially in europe. but longer term we still have to deal with these supply issues,

especially if russia continues to be cut out. >> without a doubt i know oil bulls will point to the fact that, yes, there was a bad momentum break and it's testing some upward lines. but near term oil prices, spot and near term futures are trading at a big premium to the more distant months. you have that structure that still says that supply is tight. clearly the market is also saying that there's going to be some growth concerns but that's about down the road, it's not addressing what's happening in the moment on the supply/demand balance. so it's definitely tricky, but there's no doubt that it should help the peak inflation story, because obviously the fed has told you that's what you're watching but now it's much more about what it's telling us on the growth outlook. >> tomorrow don't miss the evolve global summit i'll speak with mike worth you can recommendingster at cnbcevents.com the drop in oil prices is certainly helping the airline

stocks they're soaring today, holding on to gains despite this late-day selling that falling oil price certainly helps with the jet fuel costs as they continue to deal with sky-high demand from travelers american the top performer on the s&p 500. updating its q2 guidance saying it expects total revenue to be 12% higher than 2019 we're getting delta second quarter numbers tomorrow morning. susquehanna positive on southwest citing its new fare class and a push to corporate travel check point numbers also trending better than 2021 and in recent days above the same day in 2019. check out boeing having the most positive impact on the dow up more than 8% it reopened 51 airline deliveries for june, highest monthly total since march 2019 the question everybody has and hopefully we'll get some clarity tomorrow is how long this pe

pent-up demand surge can last. >> exactly that's why americans' guidance was a little catalyst for some relief the airline group is down 40 something percent from its highs. 25% in the last couple of months so there has been some doubt built into the sector and if they can preserve any decent margins because they keep scrambling for staff and obviously energy prices going down is a little boost as well the southwest call is interesting. that's one of the big ones to a degree that still is in the reasonable zone, the pre-pandemic zone in terms of how it's valued. it didn't have to take on an enormous amount of capital the way american did in debt and equity sales >> morgan stanley downgrades america express to 143 from 223. the analyst there citing rising

recession risks. inflation taking a bite out of consumer spending and increased credit losses and unsecured consumer loans kate rooney joins us kate, american express versus some of the other credit cards how does it usually fare in this environment? >> it's interesting. amex is exposed to that higher income consumer who's usually seen as immune from inflation and price hikes. that's not the case for visa and mastercard they're more evenly distributed across income levels but all of the payment giants really said something along the lines they're not seeing any weakness in the consumer and the inflation wasn't hitting the spending point yet the average ticket cost goes up so people will spending more but ark investor cathie wood said that high income earner and argued the fed is making a mistake, still arguing for deflation over inflation, but

mentioned that the higher income earn rz are feeling the pain for a couple of reasons right now. here's what she said. >> if you break it down between high income earners and lower income earners, what you find recently is that high income earners are feeling worse than low income earners and they're feeling terrible because the food and energy price hikes have been a cruel tax on them high income earners, however, for the first time certainly in 40 years have not had the stock market and the bond market going against them at the same time. so their assets are being hit. and now housing may be joining -- may be joining that list >> so, guys, cathie wood's argument playing into what morgan stanley is saying about amex and the high income consumer back to you. >> kate rooney kate, thanks i feel like, mike, we should

disclose when cathie wood -- to her credit, she's been consistent she's bearish, she thinks we're in a recession and we're seeing disinflation that helps the ark innovation fund if we are in a low growth or no growth period, in a period where inflation is coming down or declining, that's really good for her stocks which have been crushed when it's going the other way. >> at least that's the type of backdrop in which those stocks could come to the fore the big picture view is that these massive waves of disruption arin parentally disinflationary and it's not going to be about the current economic cycle that's the reason that they perform right here when it comes to the financials, it is very interesting without a doubt, morgan stanley is correct if we get a recession and consumers are fully struggling the way they would in a normal recession, but we got upgrades from jpmorgan saying they're in

good shape if they don't get there. that's really the crux of the debate in the sector. >> 152 high today. the brewers are having a good stay just a few minutes away from the close. off the lows but still down pretty much across the board we were as low as 300 down on the dow. joining us right now is mira the focus has been on these macro numbers inflation, which we'll get tomorrow, what the fed is going to do but the bears at least for equities, their argument is we haven't factored in weaker earnings or weaker fundamentals for corporate america. what do you expect to see? >> i think we should see more realistic expectations on profits which are looking really rosy right now at the same time, i think we could eke out some positive earnings growth for the year as a whole because we do have a pretty good cushion in terms of

margins. what we're still looking for when we hear guidance from different companies is how is pricing power being exercised at this point how resilient is consumer demand what is the situation with inventories, whether it's a glut or still challenges in replenishing and ultimately how are companies managing through this pricing environment? is there any indication of employment changes, whether it's hiring freezes or layoffs. those are what will help us understand how revenues fare for the rest of the year and how do companies defend their margins. >> with that said, what are you telling clients to do? which sectors and what types of companies? >> ultimately we're looking for different sectors and companies that can exercise this pricing power and do tend to have a little bit more operating leverage we see that in more of the value oriented companies, whether it's energy, materials or financials that are able to more efficiently earn profits

but at the same time it's not a wholesale one sector or one industry or the other. it's really on a company-by-company basis because we see a lot of differentiation under the surface between how different companies are withstanding this environment. >> what about growth versus value? that is heating up again as we wonder whether inflation has peaked another strong down day for oil. >> even if inflation has peaked, we're still likely to see high inflation throughout the rest of the year even if inflation gets to maybe 5% by the end of the year, that's still an environment of high inflation even as we think about next year being closer to 3%, a lot higher than we've experienced historically, at least in the last 10 or 15 years so there's definitely a case to own value in this type of environment. but as we head to the back half of the year, people will be looking for portfolios and even if the fed doesn't pause or

pivot this year, we're likely to see a slowing pace in terms of incremental rate hikes if most of the fed hiking psych 'em is done by the end of the year, that does remove a serious headwind to a lot of growth. >> meera panvit, thanks. we're down 190 or so on the dow. it's been a volatile final hour of trading what are you seeing in the internals. >> it's definitely weakened over the course of the day, sara. it started out two to one or 60/40 positive for negative. the equal weighted s&p has been outperforming the market cap weighted version for a while but really not determining much of anything in terms of the outlook here $1.3 billion on the advancing side, almost $2 billion to sell. take a look at the u.s. versus the rest of the world. the s&p 500 still nosing ahead

here we have the strong dollar situation. the rest of the world clearly seeming like much more of a growth scramble at this point. the volatility index ticking above 27 we'll see if it can deflate after tomorrow's cpi tomorrow. that's kind of the next known catalyst that we have out in front of us. >> worst performer is servicenow at the bottom down 12% or so after warnings by the ceo of a tough macro environment. as we head into the close, we've got a 200-point decline on the dow. boeing is the best performer, at least most positive contribution right now for the dow. as far as the most negative, it's microsoft apple is contributing the most to the etf that tracks the s&p apple is bucking the broader technology sell-off. microsoft on the other side of it nasdaq down for the second day in a row and you're seeing broad-based weakness it's not just microsoft, amazon,

alphabet, adobe, costco, all a little weaker today. every sector is lower in the s&p 500. energy by far the worst performer, down about 2% on another big slide in crude oil and the treasury yields. that's it for me on "closing bell." now into "overtime" with scott wapner and welcome to "overtime," everybody, i'm scott wapner here at the new york stock exchange you just heard the bells, we're just getting started right here at post 9. lots coming up at this hour too. in just a little bit i'll speak to mike mayo about why he cut estimates and price targets for the biggest names. plus lo toney is with us on which tech stock will fare the best in the months ahead we begin with our talk of the tape judgment time for stocks that critical cpi report dropping in the morning, just as earnings season gets hot and heavy. so what are investors to do?