expected to do well in part because china's own huawei stopped selling these premium phones, courtney. >> very interesting stuff you know we'll follow closely when we get closer to the iphone launch steve, thank you very much thank you all for joining us here on "power lunch." >> great to have you, courtney. >> thanks for having me. >> "closing bell" starts right now. fed fears and bank earnings sending the major averages lower but we are well off the worst levels of the session. in fact we are near session highs. it's been a remarkable recovery. the most important hour of trading starts now welcome to "closing bell." i'm sara eisen the dow is only down about 150 it was down 630 this morning at the lows of the day. the s&p 500 off a third of 1%. two groups actually in the green, technology, information technology the chips are leading. qualcomm, applied materials, analog devices and consumer staples are positive everybody else is down but a lot of these losses have been recovered. energy, materials and financials

the bottom performing groups check out some of the top performers right now in the nasdaq 100, which is leading this market comeback i mentioned qualcomm, there's costco as well and some of the semi conductors which have been hurt lately on these cyclical fears. we got a big change during the day after some fed commentary. governor waller throwing cold water on the 100 basis point rate hike talk for july. we've got a big show coming your way. we will talk to max levchin following a major down round from klarna. plus a new partnership sending his stock higher today also hannon armstrong is fighting back. we'll talk to the ceo that is the subject of muddy waters' report let's get straight to the market as stocks try to shake off these fed concerns and disappointing bank earnings. the dow was down more than 600 at the lows after jpmorgan and

morgan stanley missed wall street estimates joining us now richard bernstein and david ellison. good to have both of you gentlemen here dave, i'll start with you as the bank portfolio manager i know you have morgan and jpmorgan in your funds, correct? were there any big surprises here weren't we gearing up for sort of a negative report >> well, i don't think the reports were negative. conditions are actually pretty good i think that's not -- i think the issue -- >> i guess i mean the setup was negative going in. >> people were worried about rates going up the numbers were fine. credit is fine the margins were up a little bit. the problem is that things are too good the bank industry, like some other industries, need a cycle to make money. we haven't had a cycle in a long time because the fed has held it up so my hope here is that we have a credit cycle, we have a rate cycle, we have a real rate inversion cycle, we have a liquidity cycle, and that allows

people like me to actually buy stocks that will go up after that's over as opposed to sitting here with everything is good but the stocks really don't go up when things are really good in this industry. >> so to be clear, you're buying now on hopes that the cycle turns again? >> well, the truth is i hope things get worse because then stocks will go down and i'll be able to buy them when everybody is afraid, just like in the pandemic, just like in '87, '92 and the financial crisis of 2008 that's the time to buy financials when everything is in trouble and you buy the best managements. obviously morgan stanley, jpmorgan are at the top of that list you buy them, hold on to them and make money as they recover the problem is that everybody is doing well everybody has no nonperformers, everybody has decent loan growth and the nonperformers are key. if nonperformers don't go up, the stocks won't go down to a point where actually you can build wealth owning them at the

bottom so again, the money is made when there's blood in the water i'm hoping that we have blood in the water. i know that's not what you want to hear or what the market wants to hear, but that's what we need to get to to make these stocks attractive. >> rich, what was your takeaway from some of the bank earnings this morning as it relates to their performance, which is weaker again, and we do have that inverted yield curve and the broader market. >> sara, i think part of it is exactly what you said. it's a simple model of financial profitability and the better the margins on lending and activity. so that's not real good for the future of banking. number two, i would point out that if you're a devout monitorist, you'll say that credit is the life blood of inflation. and so if you believe that the fed is going to fight inflation, you should believe that credit is going to slow and credit bill

get riskier as a result. so on top of that, we have valuations that are down so in the financial sector, you've got narrow inverted yield curve for all practical purposes, you've got valuations that are down and credit that's under pressure, and that hurts the investment banking side of the equation as well so this is just not the time to expect banks to be shining stars. it's just the wrong part of the cycle, which is what i think david was alluding to before. >> agreed. i want to bring up first republic bank. that's one of the bank stocks higher today, it's up 2% reporting earnings, really strong loan growth, dave, strong on a number of metrics credit quality remains excellent according to the ceo how do you explain that, given what we've seen from some of the big banks? >> well, it's a niche bank, does a good job of serving their basically middle to high-end

customers. the mortgages or the debt, you're buying a $2 million house and have a big mortgage, and so they do a good job of doing that they have been doing that for a long time and they haven't -- so it's a growth story, and that's okay i've owned it on and off over the years. i don't own it now because i think the valuation is too high and the forward-looking opportunities aren't as good as they were given that rates are up and housing has cooled so we'll see what happens but there's a lot of those in this market. i think the opportunity -- and again, that stock is down too pretty hard from its high. it's not like it hasn't gone down with the market, but again, it's a well run bank, it's a niche, done a great job over the years and has a premium valuation that it deserves but it doesn't mean it won't get caught up in the maelstrom that seems to be developing in the market with rates and credit and liquidity problems. >> true. 42% off its highs.

we've got to leave it there. dave and rich, thank you for joining us today good to see you. shares of esg name hannon armstrong are down about 20% this week following that short report from muddy waters carson block who told us on this show tuesday this about the company >> none of this is illegal, but hasi's legal accounting manipulation is just so extreme, it's so divorced from reality. >> hasi is the stock symbol, hasi up next, the ceo with his first response to the allegations raised in this report. you're watching "closing bell" on cnbc. the dow continues to recover here, down a little more than 100 points - hiring is step one when it comes to our growth. we can't open a new shop or a new location without the right people in place.

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and it's only available to comcast business internet customers. so boost your bottom line by switching today. comcast business. powering possibilities. let's check out today's stealth mover. it's ao smith, one of the bigger underperformers in the s&p 500 bayer downgrading it from neutral to buy cut its price on the stock from 60 to 72 down 3.3%. down 200 on the dow and the nasdaq is back in the red. shares of climate investment company hannon armstrong in the green after falling nearly 20% on tuesday after muddy waters published a short report targeting the company titled esg is for exaggerating, scamming and grifting muddy waters coufounder carson block joined us tuesday to make

his case last night hannon armstrong released a response that sets the record straight and the ceo joins us now first on cnbc jeff, thank you for joining us with your side of the story. so what exactly does muddy waters have wrong in this report about your company >> well, let me get to that but let me first for the audience just explain what it is we do. we are an investor of capital in the physical assets that reduce carbon, wind projects, solar projects and energy efficiency we get repaid when those projects produce energy or when they save energy our investment thesis will make returns investing on the right side of the climate change line. we do this with the best energy and infrastructure companies in the world, ng and clearway on the renewable side, sunpower and sunrun on the residential solar and siemens and johnson

controls we've been doing it since the '80s the firm is 40 years old and we've been public nine years it is a really complex business and it's a really big opportunity. but let me be perfectly clear. we absolutely stand by our accounting and financial reporting 100% we believe our press release has indeed set the record straight and you'll probably ask about conditional questions that he posted this morning. i think if there was a careful and studied reading of what we posted yesterday, you would understand that we've already answered his questions >> well, let's talk about it for the sake of our audience so one of the accusations or questions is around the dividend and how you're funding the dividend and whether you're funding the dividend with cash flow so the question there is the accusation that muddy waters raised is that it comes from external financing debt and equity and that ultimately it might not be sustainable

should investors be worried about the dividend and can you clarify where it comes from? >> investors should absolutely not be concerned about it. cash from our portfolio more than covers our dividend that is full stop. this should be the end of the story. >> fair. what about -- even the analysts, jeff, raised the question and said that the business is very complex and the accounting is complex, right, so it's not necessarily easy to explain, for instance, the gains that you're getting from some of these investments and what is realizable and what is not i guess that's the crux of carson block's issue can you just clear up for us an stand by all of the income that you have reported? because he is saying that a lot of it is just not realizable >> we absolutely stand by every dollar of revenue we have

recognized accounting is very complex and i don't think there's anybody in this industry who is a big fan of hypothetical liquidation at book value gaap accounting, it is hideously complex. >> don't understand it. >> we do it. yeah it is an arcane specialty that all of us would be thrilled if there was some alternative to it there isn't. we are fully s.e.c. kplcomplian. we do our accounting the exact same way as our counterparties do their accounting. and we know that what we're presenting is the best possible way to present our economic performance with the accounting -- with the gaap accounting rules that there are. now, we've been working for a while on an additional disclosure that we've been talking to investors about and announced yesterday in the press release that we will try an

additional disclosure to try to get to the cash question that has perplexed muddy waters and some others. it isn't easy. i wish we could make it easy with a magic wand, but we do have a disclosure that we think will absolutely reinforce the statement that cash from our portfolio pays the dividend. >> right because i guess his point is that some of the noncash will never be received ultimately as part of earnings, right? >> it's one of the many misstatements he makes we have a very rigorous quarterly process. we're audited by a big four accounting firm. we have a terrific accounting team we have a quarterly process to evaluate every dollar on our balance sheet, and its collectability and what is the appropriate discount rate.

we look at it every quarter before we report earnings. we are confident that we expect to receive every dollar. >> well, a lot of companies do get audited. and it should be clear, i just want to make clear that carson didn't accuse you of -- and muddy waters didn't accuse you of doing any illegal, i think it was just aggressive accounting metrics in this report >> i think we have a reputation as one of the most conservative firms in the industry. we've been around for 40 years there's a lot of ups and downs that have affected this industry and financial services like '08 and '09. we've gone through these we've been through much tougher times than the industry is going through right now with a slight tick up in interest rates. we report earnings august 4th. we would be delighted to have as many people listen to our

earnings call as can spare the time we will continue to engage with our shareholders and with our analysts to make sure they understand, and frankly they do understand from the conversations we've been having this week, of the validity of our accounting and our financial reporting. as to the future, this is a phenomenal time in this industry we have a very big problem in climate change the incredible change in technology to address this is increasing our investable universe every day and then if you overlay the russian invasion of ukraine, it reminds me of when i got into the business in the '70s of the oil embargoes. energy security is national security and we need all of the above. we need hydro carbons, solar, wind, and a lot of other technologies that haven't even been invented.

when we do that, when we take all of the above, we can have energy security and we can have a meaningful impact on climate change >> it's one reason why your stock has been so successful since the ipo. i think that a lot of investors buy into that narrative. jeff, thank you for joining us and sharing your perspective here on this story and keep us posted. >> have a good day thank you. >> you too. let's check in on the markets right now. down about 163 on the dow. we'll see if the nasdaq can avoid a fourth down day in a row. it's trading just along the flat line, had gone positive. the s&p down 0.4 of 1% again, we were sharply lower at the lows of the day on the s&p down about 80 points at the low. we're down 14 right now. the nasdaq 100 is positive by a quarter of a percent after the break, the one level of the s&p that should be on your radar. and later max levchin on the future of buy now, pay later

following a big downgrade for rival klarna also stripe getting a big downgrade in its valuation as well check out some of the top search tickers. 10-year yield in the top spot. yields are a little higher, pushing up against that 3% level. jpmorgan down 3.6% off earnings, spending buybacks and the s&p 500 down a third of 1% with crude oil a little higher. it was a l lerotow a little earlier in the session and it's been turned around we'll be right back. ment. the new frontier. ♪♪ eh. ♪♪ it's not time to escape. it's time to engage. it's time to plant more trees. hoo! ♪♪ time to build more trust.

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nice comeback today in the market s&p 500 cutting its losses the nasdaq currently positive. let's go to today's dashboard where mike santoli is here with a long-term look at the s&p 500 and some clues maybe as to where we're going? >> yeah, possible downside levels to keep in mind, sara you have a lot of strategists trying to figure out what the potential downside risk might be short term we have stayed above

the mid-june lows, just above 3600, so right here you have this 1,000-day moving average, 200 weeks, and this goes back over 20 years, like 24 years since the bottom in '09, you've bounced off that level several times. we cut through it just briefly in 2020. that is right around 3500 at this point, just under 35, and it's also halfway between the march 2020 low, which is 2200 and 4800 which is the all-time high you cut off of that appeared get to 3500. a lot of strategists have over reasons for it but that would be a little bit of a test it's not that far below the recent lows that we already have hit as recently as a month ago. >> we will keep an eye on that level. up next, max levchin on the outlook for the buy now, pay later industry as the valuation for rivals klarna and stripe today plunge we'll be right back.

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fintech company stripe is cutting its internal valuation by 20% this follows klarna's valuation haircut of 85% another buy now, pay later company making headlines is affirm that is getting a pop after

announcing a new partnership with seatgeek. joining us now in an exclusive interview is affirm ceo and founder max levchin. max, it's great to have you back on the show. welcome. >> thank you great to be here. >> i feel like some of these announcements with these retailers like seatgeek or amazon was a huge one, the market gets all excited about the announcement and then totally forgets about it and starts fretting about higher interest rates and inflationan the consumer explain what the significance is, why these announcements are so important as far as future revenue. >> if i could explain the stock market here, i would probably be in a different job but fundamentally, we're really focused on driving long-term value for our shareholders, executing on our vision, making sure we are staying on track with our mission every time i have a chance to announce a really exciting partnership, it's certainly a lot less about the stock price and more about signaling to

other retailers and most importantly our consumers that affirm is available, we are a more responsible, more intelligent way to buy things and it's just great to raise your happened and say if you're thinking about going to a concert or traveling, we're here to help you out. i think the stock market today is having a good day with that and i'm sure tomorrow they'll have their concerns. >> it's up 6.5%. max, does it signal that this business, buy now, pay later, is still growing as fast as it was a few months ago >> i think the stock markets in and of itself is a signal that i cannot interpret but i can absolutely tell you that affirm as a business is doing really well and we are absolutely still growing just as well here are a couple of fun stats fourth of july weekend because it is relevant to this announcement, airline purchases more than tripled just for that weekend. people went out to see their family and concert tickets

10x'ed obviously we are coming off a pandemic-induced lack of going out but that's a growth signal buy now, pay later is expanding into something that is very underconquered right now. >> have you seen any softness in demand for buy now, pay later services >> we're growing both by signing new merchants, growing within our existing partners and through our partners like shopify, amazon and walmart. and so our growth that's been going really, really well is probably not indicative of consumer shopping. i think as inflation we just heard another concerning report goes up, the demand for buy now, pay later actually increases because your ability to buy goes down as prices go up and your salary isn't keeping up. affirm will help you manage your cash flow more over weeks and months so the demand is actually increasing among consumers. >> isn't that sort of a double-edged sword if people are increasing their

use of it might find themselves in more financial trouble and in more debt than they might know just because it is so accessible, these services >> i would argue that credit cards are infinitely more accessible what we have to offer is a much more intelligent alternative our particular interpretation is extra responsible. we don't benefit when consumers are late because we don't charge late fees and don't compounding past the number that we advertise at the moment of purchase so we have aligned ourselves with our consumers' best financial interests and continue to do so so i feel very, very strongly that what w have to offer is much, much better than credit cards and we are absolutely watching out for our consumers overextending ourselves and sometimes you have to say no to a transaction and we have a chance to underwrite every transaction and we have to say no and tell our consumers you're overextending yourself and please don't buy this.

>> what are you seeing with delinquencies right now? >> i think you can start to see the signs of concern on the horizon, but because of the structure that we put together for ourselves, very short-term transactions, underwriting every single transaction, we are able to drive delinquency as an input into our models as oppose d to a consequence for lending. as a result we feel very prepared for recession but there is no doubt that rising prices will stress consumers. >> what do you make of this klarna markdown? a company valued last year at $46.5 billion gets marked down to $6.7 billion. what does that say about faith in a model in the industry and could it be an opportunity, competitive advantage for you? >> i think each one of the bnpl players is very different.

we're going to be the superior technology, the superior risk manager and do the best to our consumers' financial interests and merchant partner needs i think other companies were just growth at all costs and unprofitable so the market is -- i think the right time to ask the question of what happened to all of the bnpl players, we feel very good about our ability to survive and thrive and add value to consumers and mechb anlts we'll see what happens to the rest of the market. >> the stock has trashed and if we are seeing something like a dotcom bubble bursting with all that liquidity going away from the federal reserve, there are going to be ultimately winners and losers some are looking at buy now, pay later as a sign of that high

liquidity and wondering if this is an industry that will be around in the next ten to 20 years, a real survivor of this >> i'm obviously heavily biased but i'm very confident affirm will be around ten years from now. we have over $3 billion available cash we were very lucky to raise right before the current hard times began. we have exceptional partners that we have done great things with and continue to do great things with. we're growing really well. we're trying to be a very responsiblelender. we have lots of things to build and deliver on and will continue to do so i'm sure ten years from now the market will appreciate that. >> what about all this competition, max i know you get questions about apple, paypal is getting into this the barrier for entry seems low because you have all these players jumping on the bandwagon. >> that feeds into your prior question i think the barrier to entry seems low. underwriting is hard

it's something we took 11 years to build we feel great pride and confidence that what we have created is complex and a real moat something others can't do simply by saying up we'll show up and do this too. again, our technology and underwriting skills are unique and different from the rest of the industry and that's what it takes to survive in a stressful market in many ways as much as i don't want to sound like i'm taking a victory lap too early, the recession is a test. that's what you find out if your underwriting is any good. >> and high interest rates also. i think the market is very concerned about that and the impact to your business model in particular, max. the other risk i read about here around this space is regulation. what are your expectations what are the regulators looking into here and what can they do >> actually i think that's probably the single -- again, it sounds too -- a lender that doesn't charge late fees,

doesn't do deferred interest, all the things regulators love to point a finger out, we don't just do none of those things, we actively try to help our consumers not get into financial trouble. i think regulatory attention to this space is good it has to be thoughtful and has to consider the interests of the underlying consumer. but creating a simple set of rules of how to report loans to the credit agency is really important and i'm excited there's good work happening there. regulating things like excessive fees by some of our competitors would be a good thing, so on and so forth generally speaking, i think that's a net positive for the industry. >> max levchin, addressing all the concerns out there that the market has and the new deal today. we appreciate the time thank you. >> thank you for having me. >> ceo of affirm. take a look at where we stand right now in the markets the continued recovery is amazing. we were down 630 at the lows this morning, down 144 on the dow. we're positive on the nasdaq,

looking to break that losing streak we have seen pretty much all week long, at least on the nasdaq the s&p still down 0.4 of a percent and most of the sectors are still red. financials and industrials at the bottom of the pack but technology is positive, chips are leading and staples are holding up quite well. up next, a pair of new reasons on why the fed m he ayav a hard time fighting inflation well would you look at that? ♪ ♪ 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]

in today's big picture, a few data points. the inflation issue is going to be hard for the fed to con taken. the average monthly rent for a manhattan apartment surpassing $5,000 for the first time ever $5,058 to be exact

according to a report, averages for rental prices were up 29% from last year then we got the june producer prices for the country up 11.3%. that was near a record jump. measures what suppliers charge businesses and other customers for goods at the wholesale level. and even without food and energy, which is a big part of it, wholesale inflation jumped 8.2% from last year. it's a signal that that inflation is permeating the production chain but energy prices have come down brent crude oil falling below levels it saw they start of the russian invasion of ukraine. they're about flat right now, below $100 a barrel. we'll keep an eye on it. up next, we will discuss whether taiwan semi conductors better than expected earnings are calming concerns about chip stocks. > >>plus another big deal for ev maker canoe when we take you inside the market zone

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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. mike santoli is here as always to break down these crucial moments of the trading day leslie picker on the banks and kris tear kristina partsinevelos on the chips mike, it's still a pretty strong recovery from what we saw this morning. what was it, the fed speak >> it seemed like it was the fed speak. it seems like we're trading between three-quarters of a

percent and 1% in terms of an expected rate hike in july once we got governor waller essentially not endorsing a full percentage point, you saw the 2-year note yield come off the highs, you saw the u.s. dollar index go down half a percent, give up its gains so that's basically the story. the s&p did test the low end of this range we've been in the last couple of weeks beyond that, there's not a whole lot driving it except that sensitivity to every little new fresh input about what we might expect out of the fed so far. >> just wanted to share some reporting about a big bond deal. pepsico had three tranches, a $2.5 billion deal. the demand was off the charts, $16 billion in demand. we're talking about corporate bonds. apparently pretty tight spreads compared to, say, the 5-year yield, mike. it just speaks to the fact that there is still very strong demand for investment grade credit, especially a name like

pepsi, which does have very good earnings and is considered a safety stock in this kind of environment. but some people look at this, especially the investment grade market, and say there's a bit of a disconnect with the stock market where the stock market is more bearish. >> i would say possibly that is the interpretation, although it's a similar dynamic in the stock market you do have a bid in predictable, steady, quality type assets. it's the same type of thing with corporate bonds. pepsi is like an a-plus rated credit incredibly safe. given what's gone on in treasuries, you have rebuilt a little bit of a nominal yield cushion so maybe it fields attractive you're getting 4% or whatever it is on a five-year paper. so it's understandable even when you have riskier debt, it's been selling off and spreads widening out. >> let's talk about the bank stocks because they are under pressure after disappointing earnings from jpmorgan and morgan stanley

jpmorgan was hit by an increase in loan loss reserves and suspending their buybacks. morgan stanley missing on the top and bottom leslie, what is the read-through for the rest of the banks reporting tomorrow and monday? >> it's interesting, sara. if you look at how the rest of the banks are responding, all of them are underperforming the s&p 500, but morgan stanley is the best performer out there which would indicate the market isn't too concerned about the results they saw with regard to investment banking they were pleased by the offset that came from trading activity during the quarter but underperforming in addition to jpmorgan is also citigroup and bank of america which have much more exposure to the benefit, one would suspect, from second quarter net interest income, which was served as a tailwind from rising interest rates. that's of course the profitability metric that they get from being able to charge

more for loan making so it's kind of surprising to see such a large sell-off in the more commercially oriented banks, whereas the wall street ones are holding up a little bit better despite the big slump in investment banking. >> really quickly, leslie, jamie dimon usually sets a tone in what he says he said the hurricane a month ago and people are still talking about it what tone did he strike today? >> he struck a more measured tone, especially related to the tone that he had back at that bernstein conference in early june where he talked about the economic hurricane is essentially coming, it's just a matter of how big it's going to be we're being very conservative. today he definitely highlighted more positives he talked about the strength of the consumer he talked about how business credit was better than he's ever seen in his lifetime and because of that, the consumer is in a really good place leading into some of the potential risks that are on the

horizon, noting that we should know within the next six, seven months or so what all pans out with the likes of quantitative tightening, with the likes of inflation, interest rate hikes and the like and how that all impacts our economy. >> down 32% this year, jpmorgan, down about 40% almost from its highs. don't miss first on cnbc interview with wells fargo cfo tomorrow at 3:00 p.m. following that earnings report. let's hit the chips. taiwan semiconductor a bright spot, hiking its full year sales forecast, partially due to strong demand from automakers. kristina partsinevelos joins us. kristina, investors like these results and it looks like the whole sector is rallying any red flags to be aware of >> tsmc is a incredible company. the company management did acknowledge that customer inventory levels are elevated.

what does that mean for future orders the second point, we've talked about a lot, the slowdown in pc sales and handsets and consumer electronics as a whole the third point is that supply chain issues are still persisting within equipment so much so that the company itself is lowering its capex. that could mean that there will be delivery delays going forward because they just can't get the tools that they need nonetheless, sentiment is pretty strong you're seeing qualcomm and analog both possibly hitting their second week in a row of positive territory and amd getting a price target uplift of 15% higher from bank of montreal so sentiment is strong with tsmc but there are some spots to focus on and keep in mind for the future for semis. >> got it. thank you, kristina partsinevelos. i want to move on to ev news because we got a lot of that, including a pair of analyst calls on tesla

morgan stanley lowering its price target to 1150 from 1200 citing slowing economic growth and credit headwinds then there's truist initiating coverage of tesla with a buy rating and a $1,000 price target citing significant margin upside potential. look at shares of canoo. on the heels of a deal with walmart, which is acquiring 4500 electric delivery vehicles that stock has doubled since that deal was announced. phil, is tesla's dominance starting to erode? that has been the question all along, but we are seeing traction from some of the competitors. >> well, some traction, sara remember, tesla still sells 71% of the evs in the u.s. that's how much of their market share they had in the first half in the first quarter it was 74%. so a little bit of erosion they'll still remain strong over the next couple of years the call from adam jonas, i

should point out, is not just about tesla, it is about the auto sector overall and the fact that if we are approaching a recession, you've got a number of factors that could be a headwind not just for tesla. adam jonas cutting the price targets on a number of the auto stocks 5 to 15%. you mentioned slowing sales growth pricing could deteriorate rather quickly if the country moves towards a recession. i want to talk about canoo, this contract with the army is with one vehicle. the potential here is why the stock is up. it's not actually a contract where they're providing x number of vehicles, but the potential here is significant. you take that with the walmart news, that's why the stock has moved higher this week. >> got it. phil lebeau, thank you very much mike, on tesla, the stock is

still trading in the 700s, so even though it's a price target cut, it's still higher today and they still see the price going higher from here. >> they do the firm has been pretty big tesla bulls. what i find interesting is the rationale. the way adam jonas gets to this 1150 price target, which is only $565 of tesla's core auto making business in other words, even if you believe they're getting there to 8 million units in eight years, he thinks that's about half the market value the rest of it being the mobility business and some third-party sales and the rest of it. i i think that's instructive in terms of what's built into this price. >> jim cramer will talk more about evs on "mad money" and will be joined by gm ceo mary barra. we've got three positive

groups now, technology, staples and utilities just popping into the green so it's a bit defensive there. more grim news for shoppers. conagra, the food company which makes hunt's tomato sauce and duncan hines says it's going to keep raising prices for consumers. the forecast was right for the latest quarter shares are down more than 7% this comes after yesterday's hot cpi report showed food prices increased 10.4% from a year ago. mike, what was also interesting about conagra, sure the company is benefiting from pricing but that's where all the sales growth is. they had declining volumes, unlike pepsico so maybe there are increasing signs that the consumer is pushing back. >> right i do think that's what's being expressed in the market right here there is some concern about how long you can essentially defend revenue with the price increases

in the categories that conagra competes in with their brands. the company has an investor meeting in a couple of weeks maybe the street will be alert for anything in the way of potential brand sales or portfolio trimming, things like that it's like a cheaper stock within staples but it's really been sideways, this stock, in the 30s, more or less for seven years. so it's not a new story that there's a lack of faith and a lack of enthusiasm on the street for conagra in particular, but what it says for the macro is interesting. you'll have to second guess the plans for pricing power and the claims of pricing power probably for a lot of companies this earnings season based on what's gone on in the economy and the commodity market. >> well, it's going to depend what brands you have and depend what categories you're in and whether consumers are still spending we've heard of a little more softness in the durable goods category

i don't know if you heard the max levchin interview but he said they are starting to see a turn but didn't necessarily say it was all bad for his business, that people are using buy now, pay later even more because they're struggling amid higher inflation. i was curious of what you made of that interview and those comments, especially on the weakness we have seen around klarna and affirm. >> the market is kind of saying it's an interesting new user category they are going to get more market share longer term, but it's not fundamentally different from providing personal loans, selling those loans into the market, wholesale funding into a slowdown it's not like you're getting better and better caliber of credits as you make personal and product loans. so it's a tough business at this stage and the market more or less reflects that. >> down about a hundred, well off the lows what do you see in the internals? >> it's been pretty weak to start. it was almost 90% downside volume it's improved just slightly.

still some broad declines on the new york stock exchange, the nasdaq outperforming home builders this month worth taking a look at still down much more than the market on a year-to-date basis but they have started to improve, as you see up almost 8% in the last month or so. the volatility index, not a lot to say here, kind of snoozing in the high 20s pretty much as expected. it's a hedged-up market going into the cpi the market suggesting that we clear the macro away and it's holding above the lows for now. >> goldman sachs, travelers and caterpillar are the biggest dow drags right now. the nasdaq is positive that was the first place to see the turn we're seeing strength in groups like the chips as we mentioned, information technology is your best performing sector right now on the s&p 500 consumer staples and utilities are positive as well what's not working today, the banks at the bottom of the list along with materials, down 2% on the financials index that is on top already of a big loss we've seen so far year to date down 21% on the big

banks. as we go into the close, the nasdaq is barely positive. apple is a big gainer and that's part of the story there. costco is doing well, so is nvidia, so is amazon meta not participating in the tech rally that's going to be id t here for "closing bell. i'll send it to "overtime" with scott wapner all right, sara, thanks very much welcome to "overtime." you just heard the bells, we're just getting started right here, post 9, new york stock exchange. in just a little bit i'll be joined by stephanie link who will tell us what stock she just added to in today's sell-off but we begin with our talk of the tape is this a preview of what's in to come? and fed fears front and center as some expect an even bigger rate hike at this month's meeting. what is an investor to do? let's see if he has the answers.