own. that stock has been obliterated. what are your expectations tonight? >> yeah, i've started nibbling on the stock i couldn't own it for a long time i think it will be one of the leaders. yes, this company will make some money. at these levels, this is when i start to buy, when everybody else hates it. good to see you, everybody i'll see you in a few. "the exchange" is now. i'm jon fortt in for kelly evans. here's what's ahead. just three days ahead of the july jobs report, mary daly tell me there's still a long way to go in the fight against inflation. what she thinking needs to happen with in -- we're going to talk to the ceo of misfits market and chips, coffee and

credit, the action, story and trade on amd, starbucks and paypal as they report this afternoon. first, to dom chu on today's market action. >> it looked like it would be a sell-off today, but it's not >> everything happening right now is leading to at least a bit of moderation. the s&p 500, again, session highs, up 21 points. we were down as low as 39, so 17 points, 4 is 36 the real outperformer up about interest rates. if you look at the spread, the difference in rates between three-month treasury bills and ten-year treasury notes, that's

one of the preferred gauges of the yield curve that some dreers and investors look at as a possibility indicator. at one point today, it actually inverted ever so slightly, only to go higher again we're now up by just about nearly 20 basis points there, so it's been pretty much a straight line higher since that touch of inversion so keep an eye on those interest rates one other to watch is the stock of the day massive move higher on uber. it reports a big loss, a wide loss due in large part to many of the investments getting -- however, revenue is coming in much better than expected. also some of the ridership metrics showing life as well and it became cash flow positive as a business for the first time

ever, all of that leading to some positive legitimate for a stock that's lost a third of its value over the last year we'll see if the optimism carries for some of these post-pandemic world type of trades back over to you. >> dom, thank you. this morning jolts report showing that a slowdown is beginning in the jobs market, something the fed was looking for, as it continues to hike rates in an effort to cool rising prices. today i got to speak with san francisco fed. mary daly about the fed's next move and last week's 75 basis point move i started by asking if the fed's job is nearly done. >> nowhere near almost done. we've had a good start i feel pleased where with we have gotten to by this point, but let's just remember the last numbers on inflation, 9.1%, those are far too high just go

to any grocery store and people are still struggling with the high prices they're paying and rising prices. the number of people who can't afford this week what they paid for with ease six months ago just means or work is far from down we are still resolute, completely united on achieves price stability. which doesn't mean 9.1 inflation, but close are to 2% gas prices is an example of how that will provide relief for some consumers, and it's cheaper than a metropolitan ago, that's good news. the housing market slowing is very good early signs. i'm seeing signs of more broader slowing. people are starting to think the economy is downshifting, but we can't stop there part of our work is raising interest rates the other part is telling people where we expect the interest rate to go in the future

financial markets, as you know, priced that in, and you're seeing that. we have to make good on those commitments to it into raise the interest rate or else of whole thing unravels, so part of us are expecting things to go forward, and reacting, and it would be premature to unwind all of that and say the job is done. >> steve liesman is here with some reaction. nasdaq has been rallying ever since that hike. i don't know if investors feel the same way as daly does. >> there's a bit of a gap between the market expectations and i think the fed rhetoric or the fed guidance what you set is they're starting to price in either a recession and/or fed rate cuts down the road i think what you heard from daly is a part of a process of fed officials trying to lean again

that but what he'd like to see is go ahead the range up 3.25, 3.5 range, and maybe stay there no while. what did daly say? she per membersed by the market pricing in -- you can see how the futures is priced. everybody is telling until by january but then you see the market trying to price in the rate cuts next year. both evans and daly are leaning against that pricing right now. >> yeah. she said she doesn't know what data they're looking at, but not only what you would expect, but it will be kind of jerking the economy around in a negative

way, hiking, then cutting, then -- you know >> to be fair i asked john williams about this a few weeks ago. he said there are times -- and eadvance etalked about this as well -- where the fed make tweaks it on the back side, but there is more than a tweak built into the market. i think, john, we have to talk about the full argument here of the fed. in part, they don't see the rate cuts, because they're not out there predicting a recession they have taken the two quarters of negative growth football and decided to run with it now, it gets to the critical question, which i don't think anybody can answer right now, but what happens to fed policy in a recession i asked evans about this, and he said if there's a recession where demand is coming down, we

would expect inflation to come down, but the other side of that was not necessarily so clear what you have a recession, negative growth and still high infl inflation. he was a bit on the fence with that but i think that's a question we have to start to think about indeed steve liesman, thank you so, is mary daly right is the fed's job far from over, or is the slowdown some say we're going going to force the fed to pause sooner? cameron dawson is c.i.o. at new edge wealth. what do you think? >> yeah, i think the comments about to get to neutral iter torrie and stay there is important. that's what the bond market is

phasing in she said we don't want to do that, because we can whipsaw the economy around and repeat the errors from the '70s that caused more than a decade of inflation remaining elevated. it seems to be that they want to get interest rates up and high, and keep them there, in order to make sure they have fully slayed that inflation beast right now the bond market doesn't believe them, but it's important to remember both the bond market and fed have been wildly wrong at predicting the path of the interest rates the data could definitely push us in the wrong direction. >> at the same time, i asked president daly, okay, what would it take to have a cut?

she sort of said, well, conditions would have to be pretty bad, some sort of shock that sounds like a hard landing. should stocks go up in anticipation >> in order to see the fed have enough bad signs so they say, ignore higher inflation above our 2% target, which will take time to get to, that we have to see weak jobs daughters, weak manufacturing data, but they're nowhere near bad enough to say that the fed can prioritize that data to do a cut we don't thing we have fully priced in the hard, and at about 4100, we're at 18 times. the last time we were at 18

times pre-pandemic was late 2019 the fed was cutting rates, not racing rates >> let's translate some mazy in this into stoic. here's what the ford ceo told us. >> i'm not going to pretty post-pandemic as to when the supply chain conditions would ease in our business, we have not yet seen a market improvement in the supply chain. >> how do you feel about machinery after that >> well, that supply chain issue is the reason why they missed a revenues, but it's not because of demand being weaker i think that was an important takeaway t they said outside of china, they're not seeing signs

of weakness. if you look at things like backlogs and orders, they were robust in the quarter and the fact they're not seeing any quarter cans ofations. typically you see companies cancel their order for being equipment, but they're not seeing that yet outside of russia because commodity prices are still elevated this would support continued investment, and also pointed to so overall, if there is weakness in the data, it's not showing up yet in cat's numbers. this remind me what we heard this morning from on semi's ceo, who said in their core business, autos and industrial, they're seeing a lot of strength outside of that, they're not

it makes me wonder what leaks into the other, the relative strength or weakness, especially if you wonder if the consumer will hold up into q4 >> that's such an important point. when we think of the economy outall we've seen these pockets of -- a lot less activity in housing construction you saw that in the data yesterday, which declined over 1% had has not spread to the rest of the economy yet i think that's the question. will we see this pockets of weakness, weak are demand for interest rate-sensitive parts of the cup? for now, credit carth growth is

really strong. obviously we're seeing weakness in goods demand, but services are hanging in it's a question of contagion >> that is true. thank you very much. >> thank you. house speaker nancy pelosi becoming the highest ranking u.s. official to visit taiwan since 1977, this despite the fear and fall outfrom u.s./china -- >> speaker pelosi was greeted by cheering crowds, and the tallest sky rap are let up a taiwan news report shows that

here she have visit parliament and activists, including those who have come from hong kong we're quickly getting a sense of what beijing's response will continue to be just days after her arrival, which china claims taiwan as its own, and seeing pelosi's visit as a challenge, called it a major prove provocation. >> it also initialated drills in the waters until sunday. >> a taiwan businesses are feeling the fallout. in fact, china said it's suspending imports of over 2,000 taiwan fool suppliers foismt jon? >> eunice, in the past there's been an ebl to organ, well

welcome, we can't control what with undoes. it will be different if someone from the executive break made this visit is that likely to temper china's response >> so far it is not. that's the argument that president biden is making. even whether newt gingrich visited taiwan, however, the chinese government says they still see this visit as a real affront to national sovereignty, in a way to try to encourage what china believes are separatist forces to become more emboldened, and they could see a taiwan moving in the direction of independence. so, when you look at this response, of course, it's still

unfolding, but what is interesting is the left of switchness and coordination with all 6 these government stops from various agencies, and overall just the snenl feel this is short of war that this response is quite serious. >> eunice union, thank you for that update. coming up, it's retailers versus recession fears while the industry is still opening stores plus if you're using the chips in your device to venmo someone for your latte, this is "the exchange for you, action, story and traces for starbucks and -- the results after this. your shipping manager left to “find themself.”

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guy welcome back to "the exchange." despite growing recession fears, the news seasonal all bad to retailers. in a new cnbc.com piece, the biggest shopping mall owners say retailers are moving ahead with plans to open new stores lauren, this seems part and

parcel of the big e-commerce boost during the pandemic coming back in line with the previous trend. >> that is certainly one factor at place here. you know, a lot of these additionally native brands are contributing to the store growth, you know, even just a traditional retailer like a macy's or gap that benefited online during the earlier days, now we're certainly seeing that shift. essentially the biggest mall -- you know, though you might expect, because cracks are starting for form in the -- that's really not the case simon said it reported the

highest per -- so it's really seeing companies hold true to those fans if thechd a few months bag they signed a lease, at least this is far. >> so are the rents just as expensive as they were before? is up, in essence, what he's saying >> we have seen looks at data in recent quarters, rents have started to pick back up. they really fell off, particularly in cities like new york, for example, where people fled, you know, everyone was

moving to the suburbs, and stores became vacant in 2020 there was a huge watch of store closures and bankruptcies across the retail and restaurant industry. those have started to come up in places look san francisco as well as new york one of the dynamics as play, construction has gotten really, really expensive so, as a result, you know, there's just less and less space available as businesses do look to move back into some of the storefronts. it creates a bit of a competitive environment, at least in some of the best properties simon is know for some of the best in class malls in the u.s tenants like an apple, so some of that space has become more competitive. >> whether it's food, gas or

commercial real estate, supply and demand is pretty much undefeated lawrence thomas, thank you. spin tre shares popping after the company reported better than expected user numbers. the fundamentals are still choppy that isn't stop elliott management from becoming the numb number one shareholder. we'll look at why here so bullish. how high can your grocery bill go we're inside a billion dar start-up where he says he doesn't see any signs of slowdown now cnbc trend tracker ♪

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welcome back to "the exchange." markets are mixed right now, well off the low, the nasdaq the biggest gainer right now, s&p just about treading water. here cease some of the movers, moulsen coors one of the worst performers, while the numbers are in line, we're told the beer industry saw softening sales during the second quarter. jetblue falling after posting a wider than expected loss, the

airline citing fuel costs and higher labor costs it says it's poised to return to profitability the back half of the year both cf and mosaic reported today. now to tyler mathisen for a cnbc news update >> in the next few minutes merrick garland with announce it's calling the first affirmative litigation to protect access to reproductive health care following the supreme court's decision to overturn roe v. wade since that decision, kansas residents are asked today whether or not to approve an amendment to the state constitution it would give its

republican-controlled legislature the authority to restrict or ban the procedure. right now the state's constitution protects abortion rights the vote is expected to be close. >> and stephen king testifying today, that the suggestion the two companies would bid against each other, is as ridiculous as a husband and wife would compete to buy the same house. up next, the street looking for any guidance how the chips act may impact amd starbucks facing foreign exchange headwinds, and shares of paypal have fallen in three of the last four earnings reports. we'll get the actions on those names, next.

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we have the,, the story and the trade of three names

reporting after the bell today let's start with amd, shares down 31% this year, but climbing 17% in the past week after the passing of the chips act investors are watching the seed of demand remain strong in the enterprise segment where it's seen trip revenue growth kristina partsinevelos has the story and jeff mills is a contributor. kristina, you first. >> amd did update their numbers, but the consumer client business, we saw weakness with several other chip makers, too the second point, like you mentioned, enterprise. data centers across the board will -- with intel you saw drop 16% year over year they said it had to do with equipment manufacturers, higher inventory levels, mentioned

lower pricing. the third point was competition, and who is intel's biggest comp competitor amd, and then the third point is just gp units, graphic processing units that are used in gaming. yes, prices have gone down, so from a gamer's perspective, that's good news, maybe not good news for margins, but on the enterprise level, you buy it as a mixed package, so it may have less of an impact. wall street is relatively bullish on this company, no doubt. >> kristina, makes sense jeff, how high are the expectations for amd, particularly when it comes to the guide, as we're heading closer to q4. >> listen, the as toic has moved 30%. you know, regardless of what you think, the mark razz priced in some level this stock is still in a down

trend. so guidance will be key. i think any weakness there, the stock could get sold i think on a long-term basis, though, amd is now ten -- and you can argue there's different growth profiles there, but from a long-term perspective, this is an interesting play to enter a stock like amd we're moving to compress thinks multiples, and from an economic standpoint, that's why i think i want those characteristics in a stock. maybe you have near-term volatility, but i think this is a reasonable entry point. >> starbucks, stock down nearly 30% as interim ceo howard shultz

trying to gear the company. >> analysts are liking to revenues of $8.1 billion same-store sales expected to increase overall, and 9% here in the u.s. that's a big jump. both here and abroad, inflation will be in focus last quarter the company suspended its guidance, and it's home market here in the u.s., and how consumers are faring will also be key analysts say it could weigh in on earnings, and finally any comment tears on the ongoing union effort for context, last quarter about 50 stores had voted to organize. third quarter it's now more than 200. they continue to -- the stock has down year to date, but in the last three months it's rallied. >> jeff, is this story mostly

about top-line growth or about costs? >> i do think it's a bit about both, quite honestly being exposed to the consumer the way starbucks is, that's what concerns me i think there's a bit of a read emphasize through there. even visa, they're saying no consumer weakness, but they're looking at overall spending patterns mastercard very similar. they're seeing this shift from goods spending all the way to groceries and gas, so this mix from discretionary to stable spending not necessarily good. weakness was in the consumer space. even though the cracks aren't totally visible, i would want to move out way of a company like starbucks. i notice it's cheaper than in the past, but i don't think it's a particular bargain here. >> kate, historically, is

expensive coffee a luxury? or is it the sort of thing your mainstream consumer has to buy, so therefore it's likely to get cut back on? >> such a great question chipotle and mcdonald's last week in particular talking about a pullback but analysts have positioned starbucks as a company that could do well in a recession, because the core demographic is higher-incrumb consumer that may bristle a little less. how much is that latte worth it to you that's a personal question, but it could hold you will fairly well moving into a potential recessionary period. >> we'll see the answer in the earnings results, i'm sure finally paypal shares are 70% off their 52-week high, but

up 15% on reports that elliott management has a stake in the company. kate rooney has the story on paypal >> paypal's cfo left for walmart earlier this year. i was talking to lisa elliott, saying there's been some concern that there hasn't been a resolution, there also maybe be a c.o.o. to step up, but there's been a huge focus, because there's a void here. the elliott investment, you mentioned paypal hasn't acknowledged that publicly, so any comment on that around the call elliott also has a stake in pinterest, but there's a lot of

speculation that deal might be back in play there's a thought out there that full-lr full-year guidance may have to come down. we've seen things like currency headwinds and consumer spending has been hit paypal tends to skew toward more discretionary spending so the bar has lowered for paypal in previous quarters. the question, though, john, is the barlow enough to paypal. it remains, investors call it a show he emphasize story. based on how many times they have moved the goal post in terms of their own metrics and targets. >> good question jeff, is the barlow enough how exposed is paypal to downward consumer e-commerce trends >> this is sort of a lukewarm answer, i guess, but if you own it, i think it's okay to hold it, but i don't think it's at risk of getting away from you after of rally

i put this almost in context with square, and i mentioned free cash flow profitability, quality. paypal fits the mold more than a square does. i prefer a paypal at sub-25 multiple versus something like square i do think elliot's involved is whether it's growth in other areas, the company is already doing things to increase user engagement >> all right square going by block now, by the way, wants to be seen for all three of its dim minkses kate, jeff, thank you. up next, another name that elliot has a stake in. why the firm is so bullish on those names and what the activist huge stake could mean before we head to break, a check on the markets

all three averaging now lower, s&p and nasdaq had been positive at the top of the urho "the exchange" is back in two tions i, technologists in india, and customers all on different systems. you need to pull it together. so you call in ibm and red hat to create an open hybrid cloud platform. now data is available anywhere, securely. and your digital transformation is helping find new ways to unlock energy around the world. ♪ in any business, you ride the line between numbers and people. what's right for the business and what's best for everyone who depends on it. solving today's challenges while creating future opportunities. it takes balance.

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pinterest reporting a decline in users and disappointing guidance, as elliot management discloses a big stake. julia boorstin has the story >> on the up side, pinterest guidance want as bad as fear after waerngs from others. what's really driving up that stock is the fact that activist elliot became the company as largest shareholder, shining a spotlight on its positioning to build a business around e-commerce and the ability to use products searches to better

target ads elliot says pinterest has a unique position in the advertising and shopping e-commerce systems baird echos elliot's per spect writing -- the qd 3 guidance support the idea that pinterest occupies a unique position between search and social, facing revenue headwinds not quite as severe, but perhaps not quite as resilient as google search elliot getting into the stock is one reason that susquehanna upgraded the stock, and tie to say paypal could mean he could eventually line up the two companies for a deal. >> thank you, julia. soft commodity climbing over the past year. we're going to talk to the ceo

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some headlines from cleveland fed president loretta mister. >> a lot of fed-speak. loretta mester saying inflation will not come down quickly and she's seeing little sign of inflation coming down. she says she needs to be convincing evidence before stop rate hikes they goes on to say there's a narrow path with not sparking an increase in unemployment one other thing that just came out moments ago, the dallas fed saying the u.s. did not slip into recession in early 2022 researchers looked at all of the stuff that's used, all the data used to measure whether the u.s. is in a recession, and they found that most of the indicators are running well above it it's just a lot of fed-speak

today, pushing back against this notion that the fed will imminently cut rakes or stott hiking rates you see the two-year note responding all day charles evans not quite ago hawkish. and now mester >> how does the potency look on the fed-speak? is it doing what it normally does >> it is what i was -- my first look, jon, was not at the two-year, but at the ten-year. if you would call that up in the back -- i didn't tell you about this -- but there was also an impact on the ten-year it's in that zone, jon, the five

and ten-year note which are indicative of the kind of rates that business does business at the two-year, there is some funding at that level. as you know, most businesses fund in that five and ten-year zone that is where we are seeing some potency. it's so down, jon. i think it was touching 3.5% if you go way back on that chart. the fed has a lot to make up it's seeing financial conditions ease, that's antithey cal to what the fed is trying to do here despite this bump today, it still has a gathering problem of easing financial conditions. >> makes sense i would like to claim i -- in and out something i think about often, so good to know, adding to my bank of balances. >> your tech company is funded zero >> that's right. steve liesman, thank you

one of the areas that's been hit the hardest is food, with the price of staples i. look cereal, bread and milk jumps 14% meat prices jumping 12%, while fruits and vegetables up 8%. high prices have been a boon for online grocer misfits market, which offers up to a 40% discounts to conventional supermarkets it says sales and customers grew nearly 50% joining us now is abbi ramesh, thank you for joining me what is it is it the growth you've seen is it the discount that people are coming to you for? >>. >> consumers are looking for cheeper -- the statistics are

staggering meat, seafood, dairy -- 20, 30, 40 years i think they're fueling that wallet, so i think they're looking for more affordable options. our value here is exactly that saving on -- >> how are you managing to scale in this when gas remains so expensive, like remains so expensive? >> it's challenging for us as well the big thing is we have built our supply chain from scratch. we operate our own fulfillment center, we manage our own middle

miles. we've been able to significantly limit the impact on our end. if traditional grocers are seeing, five, six, seven points in inflation, we're only seen one, two or three. we've been able to severely limit the amount of inflation one of to pass on to our customers. >> are you seeing peak inflation in your supply chain >> it's an interesting question. it's tough to know whether this is truly the peak or not candidly we're not seeing a lot of signs of food inflation abating any time soon. i think we have seen freight logistics and fuel costs come down about 20% that's translating a bit into cheaper food prices, but the actual core prices of these food commodities have not gone down

and i think that will continue to drive price pressure upward. >> you sound like the fed presidents abhi ramesh, thank you. >> thank you. what's driving those material gains that's next.

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or taste or do absolutely nothing with all those bubbles. without ever wondering if you're getting the most out of your trip. because you are. welcome back to "the exchange." this is our mystery chart, after democrats announced the inflation reduction act, part of that bill aiming to develop domestic supply chains and reduce dependent on china. pippa has more details.

>> there's so much focus on wind and other stock, but the act supports the industry in three ways it includes tax credits for battery production and mineral refining the second measure is litching it is ev incentives to -- over time for the credits to be realized more and more battery components need to be mined, refined or recycled by the u.s. or one of our three allyies. as william jones put it, this has become a choke point for the energy transition. there's still a lot of fine print around the funding, but there's a huge step in the right doctor direction

there are newer players like lithium america, and piedmont lithium. np materials operates a rare earth facility in california >> pippa, thank you. with the major indices dipping into the red, that will do if for "the exchange. "power lunch" starts right now welcome to "power lunch. i'm contessa brewer along with tyler mathisen bond yields are rising markets worrying about potential fallout from speaker pelosi's meeting with taiwanese officials. community has some tough warns for pelosi we'll examine what another u.s./china spat could meet for the markets. chip stocks having their worst year since 2008. will the chips act by enough to