>> joe t., the last word. >> to jimmy's point, valero is my final trade it's just a great edge against the growth strategy here one last check in the markets before we get going, markets moving higher, remaining higher, s&p off of its highs, but still up almost 2%, the dow up 1.5%. that does it for halftime. "the exchange" begins right now. >> hi, everybody i'm kelly evans. ahead this hour, stocks are surging after a lighter than expected inflation report. that's the good news the bad news is we're seeing the weakest productivity report for any expansion in post-war history. what does it mean for the economy? we'll discuss. the discussion has already

started carter worth went short the xle and long the broader market that bet paid off. he's closing that position today. we ask him where he's putting it next and earnings are going to be reported today, so we'll get you set up first, dom chu has the latest numbers. >> as kelly pointed out it's a very strong day for the markets overall. maybe no surprise, it gives you an idea that the path of least resistance too on the up side. they got a bit of good news, but it's very bad, but maybe it's a sign of things getting better. nasdaq with 2.5% gains there even the s&p 500 almost re-claiming 4200

it did up, nearly 2% gains there. 1.5% gains for the dow industrials. if you are looking for a place you can see in the market that's really reacting to some of that softer than expected inflation data, it has to be in consumer-oriented companies that could benefit if people had more spending power look at norwegian cruise lines the best performing stock in the s&p today, it's up 13% discover financial, on the consumer spending sigh, credit card issuers, that sort of thing, up about 6.5% etsy and target, and then darden restaurants up 3.5% if people spend less on certain things, maybe they can eat more, travel more, those sorts of thing interest rates, that was the real sign that things may be shifting this is an intraday chart. right here was 2.8%, right

before the inflation numbers came out it got as low as 2.67% on the heels of that inflation data it's been steadily moving higher through the course of the day, still, though, it's a sign perhaps that interest rates could be calming a bit if interest rates are generally viewed as going a bit lower, the expectations a little bit less aggressive, check out the technology and growth stocks many will find out netflix, amazon, meta, you name them. >> having since july dom, thank you very much inflation coming in lighter than expected, unchanged in july year-on-year consumer prices still 8.5%, but does it signal a smaller rate hike next month former treasury secretary larry summers just said he doesn't think so. >> i think it would be a mistake for anyone to radically revise their view of the situation,

based on these numbers this report is a lot like the report in march, which was followed by very discouraging reports afterwards, making the on optimists look wrong several months later >> joining me now to react and discuss, michael darda, and steve liesman. welcome to both of you mike, just a knee-jerk response i imagine on some level you agree with larry >> i think we with crook forward to it coming off the boil in the second half here inflation

expectation have also come down. there are signs of economic slows, you know, we've had a very strong labor market, but you've reported on first-time jobless claims moving up, so i think the combination of inflation easing and growth slowing will allow the fed to slow the pace of hikes they will not stock and reverse course unless something catastrophic happens, but i think they'll slow the pace of hikes. >> steve, what would you add to hear a comment like that from larry summers, he's become one of the more influential hawkish voices out there do you think at the change the fed's mind possibly? >> yeah. larry anchors the hawkish wing of the debate. i would point out to larry, it's not a lot like march, because

it's july, and rate hikes are why a bit higher as mike sid, the economy has slowed you've had a chance for some of the supply chain issues to ease, and i am, contrary to almost the entire economics universe, am in believe that putting people back to work is not inflationary. i think it's disinflationary, and we solve supply chain problems when we put people back to work. i think the mistake that larry makes, with huge respect -- i've followed him for decades, going back to russia -- but i think over laying old '70s-style analysis over the 2022 pandemic recovery is a mistake in terms of analogy >> mike, maybe you can weigh in on this. you just pointed out after

yesterday we have tipped into negative territory for productivity but what do you think is going on there how much of the story is about high wages how much of the story is about work from home can you gdp data even be stretched? >> i think it could be the adverse supply-side shocks that steve mentioned. part of it could be measurement difficulties the statistics are super volatile and notoriously challenged in terms of measuring underlying efficiency, so hopefully fingers crossed, we start to see better numbers, but this eight-quarter run has a dishonorable distinction of being the weakest, you know, for any recovery so far. hopefully those numbers improve. if some of these temporary

factors start to self-resolve, that certainly would help. >> you have a glass half full kind of story about this >> let me say, whatever mike says, he wins, because his dog is so chill. there's no way i could do this with my dog. mike wins that argument. i don't understand how people can be upset or concerned about productivity when we have the same number of workers doing 4% real inflation-adjusted gdp. when i look at gdp per working, from $129,000 to $163,000, there are forces that are working against stellar productivity the idea we're going to be on-shoring some production, that's probability of probably not as productive. the idea that we're going to be essentially doing some things for security rather than for efficiency, deglobalization is not productivity, but in any

event, at the moment, we have a huge well of productivity from the pandemic that we're working off, because we're putting people back to work. i'm not worried about productivity mike, is that wrong? i really need to know that absolutely it also has implications for policy, right? should the fed be trying harder to boost gdp which type of government policies is the right type here? >> you know, it's very uncertain on the productivity side, but i'm root fog steve's view. that really is how we raise the standard of living the fed can control the demand side they don't control the supply side as some of these shocks reverse, and they should eventually reverse over time, we'll start to see better numbers there. if we're close to the trend of the last cycle, then about 4%

nominal gdp growth would -- if we're way below the l.a. cycle, that does not put you in a good place. that mean the fed will have to have even more nominal gdp to stabilize. that's uncertainly at the moment, but i do think the fed has made some progress on moving very rapidly over the last five months, whether you're adjusting nom snead or real, in a way over five months we haven't seen since the tightening cycle of the early 1980s. that will have an influence with a bit of a lack, but the markets are looking forward. you look at they inflation expectations in the bond market coming down sharply, commodities rolling over, so we're going to get better news on the headline inflation. larry is probably a about i too pessimist you can there, but he's had a good call

>> he's 100% right i may be eating my words over the next several months, but when you do a goose egg on the headline inflation number, and 0.5% on wages, americans got a wage. >> finally. >> now, to be fair, real wages are down 3% year on year, but if you look at the chart and you have to go back to september to the last time americans got a raise. if we continue to print these lower numbers than the wage numbers, standards of living there rise i hope i don't eat my words two months from now. >> guys, thank you both. all three of you, i should say michael darda and steve liesman. rick santelli has the results of the ten-year auction >> it went well. let's go through it.

35 billion ten-year notes, the second leg, three-year notes were yesterday, 2.755 is the auction yield, and it's a big below where the one issue was trading. all the metrics were pretty good b-plus, and i think the most stellar feature of today is the fact there was so much buying coming into this auction is testament that not only the markets, but, of course, who is behind the message of the markets are investors. investors have been more correct in my opinion than many of the analysts and the economists. they gone along with this move and they have gone along with the move with regard to interest rates being well below some of their peak closing yields from the 14th of june kelly, back to you. >> all right a b-plus, 275 on the ten-year. rick, thank you very much. coming up, etfs focus on

single stocks splashing into the market one name in particular getting a lot of attention we'll tell you what it is, and what it means for investors. plus, can disney dispel the downers? will and can canada goose cap off its longer winning streak in nearly two years that's all ahead as we look at the markets, the dow is up about 1.5%, the underperformer the s&p up 2%, nasdaq 2.5%, the small caps 2.6%, back in a moment

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the most successle so far has been the access tesla bear etf this provides 1.25 times inverse. if tesla is down 1%, if it's down, this etf will be up 1.25%. it's the inverse, a short. yesterday various long and short exposures there may by hundreds more coming as it is etf industry seeks to leverage the public's interest the advantages, there are some, you don't need a margin account, for example, to own them but a lot of people in the business are not happy about the development. they pose far more risk. single stock etfs reset on a

daily basis over time you'll likely not get the return you might think. they're just plain different to understand, all of which has led gary gensler to say these kinds of complex products can present a sneak and potential risk to investors. this is kind of what happens when you get an etf industry looking for business opportunities on top of retail traders. it's sort of the perfect marriage of business needs and people looking for other things to do. >> do you think it's proceeded tore, or does it level of playing field? >> well, that's what the industry says. this is where they say sophisticated investors, but the

truth is that it's really difficult to make that distinction. no matter what you say, i've been doing this for years, it's really hard to explain the daily reset. they think after a month you'll be the 4%. that daily reset makes it difficult to track what's going on as a result, it could only be used by professionals, but most of is know that won't happen bob, thank you very much my next guest is picking up some of the hardest names hit hard amd is down about 4% kim, by the way, do you worry at all about the single stock

thing? inch i really do if anybody is out there listening, you have to sit down po a pencil and paper and watch how your earnings disappear because of single-day reset it's difficult for professionals to understand you think you should get the difference, but that is not the case anything with inverse or leveraged, you should stay away from it probably has a single-day reset, which is just crazy to figure out >> i'm a little surprised. it's a democratic administration, obsessed with crypto, doug the right thing there by this feels like, i don't know, maybe there's a justification that i'm missing or maybe these even scary, maybe

they don't know how it works, either >> amd and micron, what do you think is going on here what is the real story sure, no doubt things like amd and micron have benefited from state at home, and work at home. they're getting a one-two punch we all use pcs if you use spreadsheets or word documents, right? so that is gone people at home are not buying them right now. the gaming market as well for nvidia here's the thing, if you're going to hold this for three to five years we are going to increase the amount of digitization, and these are the companies that are going to make

the chips. it really is that simple of a story i'm just going to go there, what about intel? is the rise the tide going to lift all ships here? as a taxpayer, i'm not jumping up and down about giving alps money, because it's not free, it is our money, but it's important to on-shore some of these fab plants i think he has the corporate understanding of the company, and i think he has the chops to do it i'm for intel. >> we're all rooting for them.

i'm looking at, p.s. where they're firing some of their terrible customers, money-losing customers. who wouldn't love that and coke seems to have gone away from fizzy drinks. i think that's a bold step, and they should be able to benefit from that. >> kim, thanks for your time today. we'll dig into the bank's growing pains, and elon musk with a huge sale of tesla

shares, parent in case he's forced to buy twitter. the fallout is ahead here's a look at the 30 components of the dow, with boeing, goldman and salesforce the biggest gainers today. we're back after this.

welcome back, everybody. we're sitting near session highs, up 590. we're up 498, 100 points off that level the s&p up, the nasdaq up 2.6%, undoing a lot of the damage from earlier in the week. home builders, big theme today,

lower rates definitely helping with gains of about 4.5% these names are still only trading around 4 1/2 time earnings crypto higher because inflation was lower. just below that level now. that's been a key with unto watch for a lot of folks even coinbase, even though last need, and today marks seven years since google announced the creation of alphabet they're having their worst year since 2008 let's good et to tyler mathisen for a news update. >> the deposition of former president trump continues today, but just before the session, he said he would refuse to answer any questions in new york's state civil probe of his business

he invoked his fifth amendment right against self-incrimination lawyers for the attorney general's office are expected to ask all their questions anyone, and that could take hours. damage from an explosion in crimea, appears to be worse than the kremlin's public assessment of it. officials have declared a state of emergency, say dozens of homes were damaged a ukrainian official is saying that the country's special forces and local resistance fighters are behind those blasts and parts of england and wales will be under an extreme heat warnings lasting through the weekend. britain is struggling wednesday again with high temperatures and a severe drought after the driest july of 1935. tonight on the "the news with shepard smith," how schools are trying to cope can a severe

shortage of teachers i hope you'll join us. back to you. >> i'll see you soon, tyler. still ahead, what do the three companies have in common here all up at least 18%, and all offer clues about the consumer we have that on disney, bumble and na gsehecadaoo aad in earnings exchange. bubbles bubbles so many bubbles! as an expedia member you earn points on your travels, and that's on top of your airline miles. so you can go and see... 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. ♪ ♪ wow, we're crunching tons of polygons here! what's going on? where's regina?

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welcome back time now for earnings exchange, where we have the action, the story and the trade on three names getting set to report results. today is a bunch of consumer names, including the one doubt component reporting this week. that's where we begin with disney up about 3%, but 40% off the highs. is sentiment starting to shift, though disney shares are up over the last month david katz has our trades today. and julia, what are we watching? >> disney is expected to show a

21% increase that's expected to be driven by progress at the parks division a lot of pent-up demand to the parks. there's another factor that's very much in focus that is did i any's streaming subscribing numbers. it's expected to at 10 million subs in the quarter. there's a lot of concerns about given the decline we saw from netflix, but there's also this quick of whether they're on track long term to hit the guidance between 230 and 260 billion subscribers. and then also, kelly the advertising market, as well as the traditional media guys, about how there's this ad recession, and they're trying to sort it out. we'll by listening for that as well

>> maybe going back a couple weeks or months, how do you feel about it we do think the stock can be meaningfully higher. >> i know you're saying don't get too excited in the next. >> unless you have a great conviction about a company, we would not step in front of the earnings, especially the day of. bumble reports after the bell, up nearly 90% from its last report. five out of the last six times, and has risen on three of the last four results. julia, what is the story here?

>> whether it is managing some of the broader suggestions the number to watch is not just revenue, but also that paying user base. and the yes is whether or not we see some of those same issues that match had match warned that people are not starting to experiment with dating services in the same way they did pre-pandemic. are they able to draw new users, are some of these inflationary pressures keeping people from wanting to spend money on this. >> you're saying, maybe in the long run, there's something to like here?

>> sure, it's a pretty expensive stock. if they have a good quarter and keep the growth trajectory, we think for our growth investor, we think it's probably fine. this one will move a lot tomorrow we just don't have a sense which way? >> if it moves to the up side, do you think it gives you some long-term confirmation in other words, it tells you something about the fundamentals being intact in. >> it does we would feel comfortable buying in a better environment, if they disa disappoint, we they it probably haus down side bat numbers, we would not step in julia, thank you as we turn to canada goo, higher today, still digging out

of a big hole. the shares are down 40% this year 16% solar interest, and courtney reagan has the story on this one. china a big thing here still, cort >> i think so. you can understand what's going on with the rolling lockdowns that china still continue to say face with their zero covid policy i don't think expectations are high for china that being said, i think it's all in the commentary from canada goose how the high-end consumer is holding up around the world. i don't expect it to be disappointing, frankly none of the high-end names are seeing any signs of consumer slowdown i would point to the real real as one area of weakness, but again, that's sort of a

secondhand higher-end consumer it doesn't point out a lot of concern for canada goose for me. they usually beat their earnings expectations, but the shares can be volatile. still, canada goose, to your point is digging out of a hole, but has outperformed the s&p 500 since it last reported in may. so we'll see what it has to say, but really it's all about the high-end consumer, kelly, and most of the time it's not going to be inflation that hurts that consumer, but more of a volatile equity market. i think that does bode well for this high-end consumer i know it's like 90 degrees in much of the country, but pretty soon we'll be buying these big parkas. >> david, the last word here what do you think of the stock >> we think it's a powerful franchise and at a reasonable valuation. if they do well, we think

ultimately it would recover a lot of lost ground, so we would be a buyer if they have good numbers, but we don't have any sort of conviction, because there's been a lot on the retail side don't step in front of this one as well. >> even though it's padded, cozy thank you. that does it for "earnings exchange." for issuer goldman the apple card has been anything but what customers call a complete nightmare and the resulting investigation, next. ♪ i was having relationship issues with my old bank. it was just take, take, take. so i moved to sofi checking and savings. get 1.80% interest, and earn up to $300 when you set up direct deposit. sofi get your money right.

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want an engaging website to boost your business? you're just a click away from five star fiverr talent. hundreds of freelancer skills like web design. head to fiverr.com today and get something started. cnbc.com reports that the majority of goldman's card loans and resulting issues are from the apple card, which was launched in partnership with the tech giant about three years

ago. joining me now is the author of the piece, cnbc's banks reporter fantastic reporting in here. it's amazing two such high-profile companies could stumble out of the block. >> you called the tagline was created by apple, not a that leaves out the servicing is done by a bank that's the cause of some issues they had specifically there's a rising trend in the credit card industry called chargebacks. that's when, you know, you go to your issuer and say, either, i didn't make that charge, or i received this product, it wasn't's promised, or that's not me, that's i.d. theft. chargebacks are a big trend. merchants hate it. goldman sachs, as it turns out was overwhelmed by the number of

chargebacks. >> not its fault, you say, but they didn't expect the volume. it's classic customer service. >> apple chose goldman sachs, because they were a blank sheet. this could start this platform on the cloud they weren't going to be like citi or chase with a 25-year-old or 30-year-old credit card platform they wouldn't want to see the cool things that apple card can do goldman sachs had automated a lot of the parts for the front end of this. that means i go to my e phone, i go to the wallet and say this transaction, i didn't like that, boom, boom, you disputed it, and you started the chargeback they neglected to automate the back end when the complaints come in, and they can be complex to adjudicate, but they that for

later on, so the service personnel were struggling. in some cases, they've had people who said, i provided goldman sachs with evidence this wasn't me, and yet they still sided, after four months, with the mvp. >> the users have saying going to the cfp with your complaints. with all of the complaints and the challenges they two companies have faced is there pretty wide adoption what do you think both will continue to invest in, in terms of trying to, if they're still trying to build out this business >> yeah, we're stuck with imprecise figures. nobody actually discloses how many users there are course to advisers last year they doubled to 6.4 million as of may of '21. other folks have said active and inactive users are close are to 10 million

so, it is a runaway success. to be fair to them, there are people who say even on reddit, i've had a great experience. so, you know, it's a lot of big numbers. they obviously weren't prepared for the number of folks who adopted this, but goldman sachs wants to be big in consumer finance. you know, they're working on a goldman sachs proprietary card if they want to be big in this, they have to fix this business i'm sure there's plenty of people chuckling a bit to see this customer service problem by such an issue. hugh, great reporting. everybody should read the piece on cnbc.com. thank you. >> thank you. one of the guests called the top on this, and what he calls the singlemost development in

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welcome back to "the exchange." falling energy and commodity prices playing a huge part in

that cooler cpi number today, and my next guest called that top back in may, setting up a long s&p 500, short energy pair trade. it's certainly paid off. carter worth is here, it's good to have you. i'm nervous you're not short energy anymore, but talk to me a bit about what you're seeing on the charts here. >> sure. of course, thanks for remembering the good ones. well all have our duds i have them in spades. so far, so good. the idea was that energy was just so loved, right the word or phrase "overbought" could be implied, but when things get so loved, from time to time it's right to take the road less traveled now we have this big relative underperformance, some 1400

basis points, so far i was just thinking, you know, i don't want to be short energy relative to the s&p anymore. mean that opportunity has come and gone i do think that there are things in the market that, as was the case with centering versus the e interesting here in terms of inflation point asks one of these is small caps versus large cap. >> i noticed that. that was a day or two ago that jumped out at you. why? >> right so we know that looking at a ratio, it is -- some people say esoteric and not relevant, but a ratio is simply a way of expressing relative strength and small cap stocks have underperformed for the better part of a year and now are starting to actually outperform the s&p, and so whether it's an overall bullish call in the market some people think that's where it has to be, i would leave that aside, but i would say that the

setup here is small cap is beta, and small cap is probably the better trade on a week over week basis. >> what about the broader market >> right so what needs to be determined and we're all trying to figure out and a lot of people on both sides is the rally and the 14% move off of the low, just another countertrend because we are on a downtrend since january or if it's something the beginning of something more enduring my thinking is it remains a countertrend and we've seen several and while it's longer in terms of managing and it's not a whole lot different, but there are many people starting to make the case and they're entitled to do it. they're in that's always tempting and i don't think we'll escape that easily >> what about tech are we seeing a notable resurgence i don't know if we'd go so far as to call it leadership since early july >> that's right. the rotation has been the

reciprocal of energy, right? you've seen materials and energy and otherses that are highfliers come apart and you've seen a reciprocal move in sort of hated tech, and to some extent that puts the market overall at a moment of equilibrium, right having drawn down some 25% from its peak and now rallied 14%, 15% from its low, the market's almost half way back to the high point from the low fibonacci is not the answer to all things and a 50% recovery leads the market in a level where it belongs and it's apparent twos. >> last one for a grab bag, as i mentioned, financials and consumer and discretionary and staples which i know you've recently been less bullish on the staples and do any of those staples jump out at you as flashing obvious opportunities here >> of those choices i would go with health care and financials have struggled as we know and

health care has the offensive and defensive and it has the defensive characteristics like managed care and it has beta cyclicality because of biotech and that's pound for pound the best idea of those three. >> carter, it's great to have you on >> thank you so much >> yep, absolutely closing out one trade and putting out a few others carter worth with worth charting coming up, elon musk unloading shares what's behind the move, what does it reveal about the twitter takeover we'll dive into that next and a quick check of the markets with the nasdaq up 2. 7%. the dow off session high levels and a strong market session all day. we're back in just a moment. stay with us

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exchange," everybody let's take a quick look at the markets. the dow is down 500 points and a quick check of shares of tesla we saw obviously last night the news of a major share sale by elon musk. this despite the fact that he tweeted in late april that he was not planning any further share sales. look at the reaction in the session today. tesla shares are shaking it off. perhaps you can say they're pricing that news event in the rising 3.5% to $881. i don't know if we can zoom out to show the longer term performance and this was a stock that was under severe pressure as elon musk share sales remained in overhang here's the year to date down 16.5% or so, so they had certainly stabilized and climbed to the upside in recent days and now take a quick look at shares of twitter the speculation here why would musk be executing such a large share sale, perhaps if he is forced to fund his purchase of twitter. that's up to the delaware court. if they ruled that he has to

follow through on it he would need the capital to do so. shares of twitter today reacting positively as well, growing 3% to around $44. we'll keep an eye on both of these names for you, as i mentioned and that's the latest on share sales of tesla and twitter. that's the latest for "the exchange," as well, everybody. thanks for tuning in "power lunch" begins right now welcome, everybody to "power lunch. i'm tyler matheson glad you could be with us here it's a little cooler in the northeast on a lovely wednesday. rally on wall street investors cheer wider than expected inflation numbers and we will break down where prices are decelerating and where they may still be rising and if it's time for a new investment strategy for you plus did july mark the bottom in housing? a power call on that sector. the names that could lead the group out of its slump kelly?

>> a perennial favorite topic of discussion, tyler, thanks. here's where the markets stand the nasdaq leading it up 2.6% and doing a lot to reverse the weakness with the chip stocks lagging today and reversing that and then some. 42.03 and the dow industrials off 493 or 1.5% and it is pretty much session highs for the nasdaq all of this kicked off by the drop in rates after the softer cpi print this morning and we'll have a whole lot more on that in just a moment and more on this themed yesterday's laggards are now leaders. take a look at the cruise names and we told you about norwegian up 11% and today it's up 13% and yesterday it was all about its warning that the consumer wasn't coming back pre-pandemic levels for another year or so today it's a different story and rcl carnival, and tech stocks outpacing thebroader market. meta, netflix.

look at the gains and even salesforce they're up around 3.5% it's one of the best performers, tyler, in the dow. >> let's get to the top story of the day and that, of course, is those inflation numbers. the consumer-price index coming in lighter than expected and that gives investors hope that inflation might have peaked a month or so ago. the cpi year over year rose 8.5% in july. that was a little bit lower, 0.2% lower than the 8.7% expected and it was flat for the month. in other words, sequentially, so where did we see drops in prices and where are things still a little hottish let's dive in to different sectors of the economy energy, food, housing, cars and we'll start with energy and pippa stephens a lot of us know the story or the basic one, pippa, but fill in the blanks for us >> hi, tyler energy is at the center of this inflation report and the