>> i think there's always been this level of interest from a lot of these countries to find other places to put -- to allocate their capital, whether it's gold or another type of alternative currency, there is that type of appetite and interest for sure. >> all right, seema mody, thank you. and that will do it for "the exchange." "power lunch" starts right now >> thank you very much, john, and welcome, everybody, to "power lunch," along with courtney reagan, i'm tyler mathisen, here's what's ahead this hour, stocks mixed right now following yesterday's big selloff. top tech watcher will tell us if this selloff is warranted after the two-month rally we have had. plus, is american reliance on chinese manufacturing ebbing, becoming a thing of the past apple for one stepping up production of its newest iphone in india, what this shift could mean for the u.s. and chinese

economies. courtney. >> thank you, tyler, thanks for having me. i am courtney reagan markets are mixed, the nasdaq the only major average in the green right now. a reversal from what we saw yesterday. it was hard hit and down for four of the past five sessions, down 5% in just a week, still up nicely off the june lows helping tech today, chip stocks mostly higher on a semi and mat, mat tell leading the way also cybersecurity stocks are higher after palo alto posted strong results medical guys, bio tech, pharmaceuticals, health insurance, all those names are lower today. a day after a big selloff and stocks are mixed today, barely holding on to the gains earlier in the day, should the rally off the lows have been trusted and where are we finding opportunity now? to discuss that we're joined by ser rat settee, a managing partner and portfolio manager at dcla, also a cnbc contributor.

sarat, as always, great to see you. the market went up for two months, better than, i guess, off the lows it's been taking a little bit of a breather here. is the breather signaling anything to you that could be longer term, or is it just a breather >> i think short-term it's a breather, tyler. i think we've got a couple of things going on right now. one is we're in this little quiet period earnings have all come out, so we don't really know what's going to happen for the next quarter, but those estimates are coming down. i think you're seeing the market react to that. secondly, friday is a big day. chairman powell gets to speak and talk about where we're going to go with inflation and really what we're going to do with rates. so as always when we don't know what's going to go on, uncertainty is in front, the markets take a pause it's fine to take a pause because we had such a good run up so the question will be really what does chairman say in terms of the trajectory of interest rates, and then secondly, as

earnings come in, there is a -- you know, there's a group of bears out there saying that, hey, the p/e on the s&p is too high and it needs to come down. >> and you've got interest rates on the ten-year back above 3%, at least they were yesterday i was texting with a friend who's an astute investor, and he said what people seem not to be talking about is the pace of quantitative tightening or that the money that the fed is taking out of -- out of the economy, is that contributing here >> i think that's a big part of it because we haven't seen that before, and really, what happens there is you're going to see a huge amount of treasuries come on the market. that's going to cause the price to go down and rates to go up, so you're seeing that on the computer the interesting part there, tyler, is to watch the inversion of the yield curve from 2 to 10, and if that starts flattening or starts moving upward, which it hasn't for a long time, but if

it does, that is an indication in the market that things are going to be better ahead so just like when we had qe and you had issues as to what is really going on in the bond market, now we're on the other side of it, and we're going to see really what is the true test of the market when rates actually start moving up >> sarat, if we can, we have some very specific picks from you. i would like to start with xbo logistics. why this name in particular when you could look elsewhere in the logistics space? usually xpo is not one we hear talked about as much as some of the others. >> so it's really a valuation play hear. this one trades at nine times earnings they're spinning off their freight business they're selling off the european business, and it's really what you'll own is called ltl, less the truckload, so it's really a company that's focused on digital transformation where their vendors and customers can use them to ship goods, and there's no real hard asset there, so it's really margin as we've seen, one of the things

xpo had, it was a good thing they had too much demand for their product. we think this is an underappreciated asset it's a little confusing for people because you're spinning off freight, you're going to be left with the pure ltl bids. times like this we like companies that are trading way below market averages. we demand growing and having pricing. >> a second choice is -- i don't know whether it's haleon, is that how you pronounce it? it's a consumer products company but it's in a real low growth part of the investment world so i assume it's a defensive choice >> it is a defensive choice, and here's another -- here's why we like it. it spun off from glaxo, so whenever you get a spinoff of the first months, this is the only large pure play consumer health care space. that space by itself grows 4 to 6% a year, but the margins are

very high. this company's going to have close to 2.5% dividend, and really they have so much wood to chop here. they've got good products, like advil, things like that where people, the demand for that is inelastic. it trades at 14 times earnings, the closest comp to it is p&g at 25 once the sellers kind of move out of the way, we like companies like this that are under appreciated, not even, you know, understood at this point in a space that as we go through some choppiness and volatility in the market, you want to own strong cash flows. >> sarat, always great to sea you, sir sarat sethi, we appreciate it. >> always has interesting ideas, too, not necessarily names we talk about all the time. investors may have thought tech was having an all clear moment as it led the recovery from june lows this week may be showing that things aren't as rosy for the sector as many thought the nasdaq dropping over 2.5% yesterday and really starting to

fall during this hour of the day. so do the bears or the bulls have it right? with us is steve melonovich, tech adviser with llc. steve, this is an interesting question because it seems like this tech group can have some narrow leadership. where do you think we are right now in the cycle, and how does tech give us a clue to that? >> i think tech is reacting to the rest of the market i would say unlike 2000, this certainly isn't tech specific. however, i do think that we've seen the near-term top in tech, the nasdaq 100 peaked a week ago. it was up 23% from its mid-june low. it's down about of % i would guess there's another 10 to 16% to gochlt from a tech technical perspective, it became oversold that's practically screaming sell. >> what about the semi stocks in particular as a part of tech i know we have an awful lot of

focus there, but for good reasons. there can be some good indicators. >> i think the risk across tech and into semis at this point is probably less p/e than it is earnings we've had interest rate hikes. the risks that a lot of strategists are talking about is that earnings late this year into next year are going to be disappointing. semis are cyclical, sensitive to the economy. we all know automobiles and other products are including more semis there was also a lot of double ordering, there's supply constraints and so forth micron has talked about some weak pricing i wouldn't necessarily say semis are in a different position for the rest of tech that i think you're likely to see earnings start to get hit here, and particular to tech, you see a lot of share based comp i'll be very careful in looking at tech stocks in terms of what are the earnings. >> i'm sensing some caution here with your belief there in tech does it mean you shouldn't be buying any tech if you don't have it right now, but if you do have it, are you suggesting we

hang onto it >> well, depends on your time frame. i think a trader probably should be unloading a bit here. i think we've, you know, been near the highs i think it's going lower how much lower, i don't know on the other hand if you have a longer term perspective, technology is the answer to a lot of you are problems. a lot of interest, obviously in esg and energy as much as the government is involved in trying to finance, ultimately it tends to be the free market and technology that does that. also, we've been in an inflationary environment a lot of companies are able to raise prices if they bring inflation down, it's going to be harder to do that tech at least is a deflationary business it's used to prices going down, so ultimately when inflation is cured, i think technology and growth should be in a better position. >> so in the world of technology and semis and cloud, give us some names that you like right now. i know you love to do that >> well, sure, tyler again, i'm generally cautious, but areas of interest to me would be the analog

semiconductor names like analog devices and on these semi equipment names, particularly over time like kle and lamb i think are well-positioned. software is selling about seven times revenue, might still have further to go on the downside from a valuation perspective, but always an interesting place to be. informatica is back to the markets. i think that's interesting security is always an interest, we saw what happened with palo alto z scaler is another name that's interesting because it is a bit of a pure cloud play those would be some names. in the past i've covered apple, ibm, ibm is probably fairly defensive right now. apple, lover it long-term. >> steve, thank you very much for being here with us of tech adviser llc. >> thanks, courtney. all righty, coming up, doing business in china getting harder and harder as the economy slows. power shutdowns begin and the

tensions with taiwan grow. is it best for companies and investors to diversify els elsewhere? plus, intel, five-year low, nvidia warns and the semi etf is down nearly of % o6% over the pt week is the semi trade coming to an end? we'll talk more about that when "power lunch" continues. it was just take, take, take. so i broke up with bad banking and moved to sofi checking and savings. now i get higher interest, pay no account fees, and get my paycheck two days early. break up with bad banking. get 2.00% interest, pay no account fees, and get your paycheck up to two days early. download the sofi app and earn up to $300 when you set up direct deposit. sofi. get your money right.

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[ cheers ] are we actually going? yes!! and once in a lifetime moments. two tickets to nascar! yes! find rewards like these and so many more in the xfinity app. welcome back to "power lunch," everybody. apple reportedly moving the manufacturing or at least part

of the manufacturing of its new iphone in india much earlier than normal compared with earlier models a sign the company may be shifting capacity away from china and apple is not alone according to data from the reshoerg initiative, companies are announcing at record rates the intention to bring manufacturing jobs back to america with nearly 350,000 announcements, i guess that would be 350 job announcements projected this year. our next guest helped the company do business in china and says he's seeing an acceleration of businesses assessing whether it is worth it to stay long-term over there back with us again is dennis unkovic, veteran china watcher dennis, good to have you back. we noted apple seems to be moving some of its manufacturing of its latest iphone version or the one that will come out to

india sooner than has normally been the case. is this what smart companies increasingly are going to do, move manufacturing away from china? >> hi, thanks for inviting me and courtney back again. the answer is yes. frankly, i think apple is a little late to the party they probably should have done this earlier, but what we see happening is china for many reasons other than the very expensiveive labor market it has making it more difficult for foreign companies to do business there, and i think apple is sort of hedging its bets by going to india, and i thit more difficult? obviously xi has complete control of the economy, they have beset with power problems they have been beset with covid problems, but what are they doing that's making it harder for non-chinese companies to do business there >> there are a couple of things. the first thing is the chinese are very determined to get intellectual property in whatever way they can, and if you're a company with intellectual property that you

want to protect, you have to be very careful being there in china. secondly, the chinese are today encouraging companies, either if you have a joint venture there or if you have your own operations there to put people from the government on your boards of directors and overseeing and so china today is a lot like what we used to talk about years ago, big brother, and so as china becomes a more powerful economic force, it's the second in the world, it wants to put enormous pressure on companies and companies that are particularly technology based don't like that. >> so this makes sense to me, but it also seems to be difficult for companies to actually successfully reassure when it comes to getting the right skilled labor, the people that want to do the jobs and have the skills to do it, and frankly, even just the manufacturing capability and facilities here in the united states so what has changed, i guess, with these 350,000 new jobs that are expected to be reshored this year do we now have the skilled

labor? do we now have the facilities to be able to bring these jobs back here in a way that is still profitable for the companys? >> courtney, that's a great question let me say first of all, i think americans companies were really not recognizing the risk that they had, but when we've had the blowup or the fragmentation of the supply chain, that sort of brought it to their attention. i do think this is going to be a gradual process. wro i wrote in my book a year or two ago, reshoering was going to happen as you just reported now it is. over the next five years there will be more training. now in the u.s. we have kids that are learning s.t.e.m., and we're put aing a greater emphass on that kind of education. the workers in the future are not going to be putting together a peace of plastic for mcdonald's, i think the u.s. has open i think the biden administration in supporting the microchip legislation that's just been signed into law is an example of

what's happening >> xi is coming up on a party congress later this year where it's all but ashaursured that h will get another five-year term, but he has some internal headwinds, does he not, that could make this next term -- if it's his final term or not, who knows -- this next term somewhat drircht from what he's had to deal with before, correct? >> absolutely. he will gate third term. he certainly has no political opposition in china, but the chinese economy is growing at less than 5.5%, which is probably the lowest in the last 36 years except for when we were in covid he's got an economy that's not collapsing but becoming more like other developed economies the other thing is chinese labor is now expensive relative to what it was. back in 1976, tyler, if a chinese worker was making $0.05 or $0.10, the american worker was making a dollar.

today that has compacted and so while workers in china are still less expensive than the u.s., they're relatively expensive that's why i think as you said a few minutes ago, apple is looking to say why don't i go to india. they're highly educated, well trained and less expensive than the chinese workers. >> i heard a report this morning, the average factory worker in bangladesh make dollars 1.05 a day, which is criminal really. we appreciate you, thank you >> thank you for having me today. coming up, looking for some potential stability in cash flow on your next stock pick? who isn't, we'll trade three names with low data, stable yields and positive returns. one markets veteran says if you think the fed is done with hikes and will keep the punch bowl out for a little while longer, you're ifon r a rude awa awak awakening. he joins us with that theory coming up next

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inclusion is a strong part of this. i am peter akwaboah and we are morgan stanley. welcome back to "power lunch," chip stocks have had a wild ride this year from the lows of the shortage, the passage of the chips act, and now the news keeps on coming, earnings from nvidia and a deal for intel, let's get to kristina

partsinevelos, she's got it all for us. >> let's actually start with that cash injection for intel. think of it like a joint venture between intel and brookfield asset management they're going to invest $30 billion in two fabs in arizona. intel will pay the majority at 51% of total costs and retain control of the fabs, and then you've got 49% for brookfield. the cfo said this could potentially be something we see in the future, more partnerships like this in the chip space. intel expects to fund these from cash flows from operations and government incentives, which means it's still reliant on things like the chips act, which would help bump its cash flow by $15 billion according to the company. the company, though, is pretty good at raising capital, right what about that execution, this stock yesterday did hit a five-year low. it's trending higher at $34 a share, but down on the year. on a yearly basis, though, 12-month chart, think of that, nvidia is the stock that has fallen the most from its 52-week

high its earnings are out tomorrow. the company preannounced weaker revenue stating the gaming space faced a crypto hangover and the challenging market conditions would continue into the third quarter, which means data center sales will be a far larger business until gaming issues work themselves out. and marvel technology on the other hand is considered more of a pure play data center company with strength in 5g, especially with 5g expansion. their earnings are out on thursday this stock, though, is one of the worst chip performers this month down over a little bit under 7% right now, but both of these companies give insight into how the lucrative data center business is holding up and if these companies are successfully stealing market share away from intel. >> kristina, let's change subjects just a bit. we know you've been following amc and their issuance of what are known as apes or apes,

they're a preferred shared class. jim had some interesting things to say about what he's doing and how he's playing this arbitrage. let's listen to what he said earlier. >> we actually just initiated an amc short. we were short last year. we just initiated a new position yesterday. however -- and just calm down apes i'm actually an amc security holder on the other side we actually bought the new ape preferred, and we have shorted the amc common against it. they are economically the same security they are not froeely convertible into each other, but they are economically the same security >> what does that mean what the hell is he doing? i mean, not that -- >> the shorting and the long position part, but why do this, why would he have both sides of it >> he believes ape and amc

shares should be priced the exact same it's not the case. they're almost the same class. that means amc's business if that improves over the next few months, both shares should benefit or vice versa, but he plans to make money by exploiting the difference between the price of amc and the price of apars sh-- ape shares. that's the key point, it won't happen right away. it requires shareholder approval, so who knows how long that takes, and technically right now like i mentioned, they're not convertible. they don't have a cash dividend. i'm talk about the apes. also, he have the same voting power as amc shares, but preferred would get paid first in the case of insolvency, which is a huge perk if you're bearish on the firm and don't want to short the stock. the company can actually issue more ape shares down the line about 483 million are still available, but not unissued, and

chanos did question if this entire thing was the right thing to do because that's a lot of cash that they're raising, a lot of risk that they're adding onto the balance sheet, and that could potentially hurt shareholders down the line, especially when they issue those 483 million shares >> if he's short amc and long the apes today, he's looking good >> very interesting stuff. he makes money, right? >> yeah. >> he's rich for some reason very interesting stuff >> do you mind if we wish you good -- >> oh, yeah, of course. >> kristina's getting married this weekend congratulations. >> saturday. >> and have fun. >> make it the day of your life. >> thank you. >> if we don't see you before then, have fun. >> i'm done after this, well tonight. >> have a great weekend. >> thank you let's get to kate rooney for the cnbc naews update. >> paul pelosi has been -- facing five days in jail after pleading guilty to driving under the influence.

pelosi must pay $6,000 to cover court fines as well as the victim's medical bills. the u.n. security council holding an emergency meeting today at russia's request over the situation at ukraine's zaporizhzhia nuclear power plant. the power plant is europe's largest. it was captured by russia in march and has repeatedly come under fire in recent weeks spasp sparking fears of a nuclear zas n disaster russia and ukraine have both blamed each other for attacks on that plant hyundai and kia are telling owners of some of their large suvs to park them outdoors and away from buildings after a series of fires involving trailer hitch wiring the automakers are recalling more than 281,000 vehicles in the u.s. because of that problem, which does not have a fix yet. the recall covers the hyundai palisade through those 2022 model years. thank you very much. and ahead on "power lunch," not all growth is created equal when

it comes to picking stocks, so how do you know which ones are worth buying we've got that one next. plus, it's been a rough ride for shares of service now this year, we'll hear exclusively from ceo bill mcdermott on the future of the company and where he thinks the company's strengths lie. "power lunch" is back in two (vo) this is more than just glass, walls, doors and carpeted floor. it's a place to change the world. loopnet. the most popular place to find a space. this tiny payment thing- is a giant pain! hi ladies! alex from u.s. bank! can she help? how about a comprehensive point of sale system... that can track inventory, manage schedules- and customize orders? that's what u.s. bank business essentials is for.

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we've got about 90 minutes left in the trading day. we want to get you caught up on the market, stocks, bonds, commodities and whatever else there is the bullish investors are in for a rude awakening let's begin with bob pisani where things turned lower about this time yesterday, bob. >> yeah, and we're treading water. the dow has been underperforming because united health is significantly underperforming. 60 or 70 points of the dow's decline is due to united health. what's outperforming is energy stocks a lot of people are unhappy when they see this happening. energy is a proxy for inflation. we're at two-month highs for the s&p 500 energy index we've been creeping up in energy stocks recently. natural gas 14-year highs. this is not helpful to the bulls who want to see oil as a proxy

for inflation, and nat gas as a proxy for inflation comes down elsewhere big tech, it's down about 4% in the last week or so. a major reason we've been down is a correction in growth stocks some of the selling may be exhausted, at least short-term big pharma big mover in the last week or so they've held up very, very well. it's an interesting sign that today, that's the week a sector of big pharmaceutical stocks in addition to the sub sectors like the ones that united health are in markets just moving around here. they're just moving a lot of money around on a daily basis right now. the market fearful of a lot more hawkish stance by powell on friday why isn't the market down again today? it's very obvious, we've got real issuesmen new home sales, i services, manufacturing at the lowest level in several years. slow economic activity, that plays into the hands of the bulls out there who are arguing can powell really sound that much more hawkish at this point.

we do have the slowdown materializing that they are lacking for. guys, back to you. >> thank you very much, bob. we're going to to move on to the bond market as the ten-year yield is holding onto its big rally. rick san tetelli is in chicago. >> yields popped up a bit. they are hovering close to unchanged. the reason i brought it up is we had a two-year note option that found very little sponsorship by investors. i gave it a d minus. do remember jackson hole at the end of the week is one of the reasons yields have been to the upside, and speaking to the upside, let's look at july 1st of ten-year, ten-year on pace for one.5 month high yield close. europe pretty much as well they closed just shy of 260. they're at two-month high, and if you zoom it out 2014 we are close to the highest levels in about eight years. and boon yields closed at 132.

they're at the highest levels in one and a half months. if we look at the foreign exchange side, the european currencies are where all the strength in the dollar index is coming from. let's look at the pound versus the dollar right now it's hovering at levels that we haven't seen seasons the covid effects of 2020 however, if you go back to 1985, outside of that covid effect of march 2020, we would be at levels we haven't seen since 1985, and finally, the euro versus the dollar, almost 58% of the dollar index is at 20-year lows versus the green back, which puts the dollar index, you guessed it at 20-year highs. tyler, back to you. >> all right, rick san ttellisa, thank you. oil jumping after a few days of closing at $90. let's go to pippa stevens. >> oriole is up more than 3% today. following comments from saudi arabia's energy minister he said that opec and its allies

can adjust to fluctuations in oil prices including by cutting production he added the market is in a state of schizophrenia with a growing diverse jens between the financial market and the physical market. he said the reason volatility is harmful and that this yo yo market is sending erroneous sills when greater clarity is needed so let's check on prices. wti at 93.81, for a gain of 3.8% brent crude back above 100 with a gain of 4% turning to natural gas, which has had a roller coaster session around 1:00 p.m. it dropped sharply after freeport lng pushed back the restart date for its texas facility to november the plant, which is about 17% of the u.s.'s l and g export capacity has been shut since a fire in june, and prices are now down because traders are worried about oversupply in the domestic market and the big reversal came after nat gas earlier topped 10 bucks, courtney, for the first time

since 2008 >> a lot of wild things happening in the energy patch, i know what they're dealing with in europe is one of them thank you very much. ahead of the jackson hole summit this weekend, investors are watching to see whether the fed might be pivoting or not my next guest says this recent rally might be overly optimistic, and the fact that we are still even talking about meme stocks and crypto shows the fed has a long way to go in tightening joining me now is richard bernstein. we've been paying an awful lot of attention to what the fed is doing with monetary policy in terms of interest rates, but liquidity is something that the fed has had a very big hand in for many, many years do you think we are still too high when it comes to liquidity levels in the markets right now? walk me through the theory. >> yeah, courtney, i think, yeah, the fed kind of opened the spigot correctly for the pandemic, but never really shut it the way that they probably should have, so the result was you had tons of excess

liquidity, a very speculative environment. and speculation causes misallocation of capital within the economy, and so you ended up with crazes and meme stocks and cryptocurrencies in tech innovation disruption. all these things became very popular because it was basically free money, and if it's free money, why not take a gamble on the stuff. and so the fact that the fed is tightening, yes, they're tightening, but are they tight and have they gotten rid of the speculative fervor, the answer is no. why is that important? it continues to have this gross misallocation of capital in the economy and in other words, capital goes to things we don't need and not to things that we do need in the economy >> we were speaking a little earlier about what's going on specifically in the tech sector and the narrow leadership therein. you think that's a signal we might be towards the end of any kind of a rally here >> i do, courtney. i think that one has to remember

that when you kbegin a bull market, you have kind of the wind at your back, and what happens is that economic boost propels all companies, right, a rising tide lifts all boats and as the economy matures and you begin to lose that backdrop, that stimulus backdrop, more and more comt with service now ceo

bill mcdermott you know who he is now, but wait until you hear how he got his start in the business. as we head to the break, remember, you can now listen to "power lunch" on the go. look for us on your favorite podcast app, follow and listen at aor augstn.io th'sn der. thank you. this thing, it's making me get an ice bath again. what do you mean? these straps are mind-blowing! >> announcer: the bond report is brought to you by pimco, a global leader in active fixed income and you are? i'm an investor...in invesco qqq, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech.

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. welcome become to blu"power lunch," high growth technology stocks facing uncertainty as investors weigh the impact of rising interest rates. this week jon fortt brings us up close with a ceo who uses communication and optimism to focus his work force on the future hi, jon. >> hey, ty, bill mcdermott is ceo of service now, an enterprise software company, trying to change the way businesses run internal operations he grew up in a working class

long island family and eventually became an executive at xerox and ceo of s.a.p. before that he delivered papers, bagged groceries, waited tables, even ran his own deli starting at age 16 competing with the local 7-eleven >> and then ultimately, you know, we built this video game room i don't know if you remember that, jon, the asteroids and the packman. but my idea was to get those kids to walk a block and a half past 7-eleven to my store. >> the 7-eleven would only let them in four at a time, right? >> they let them in four at a time, and i went down there -- >> because sl shoplifting concern? >> i said don't worry about that, letting them this my store 40 at a time. >> you can't shoplift an arcade machine, you got to put the quarters in. >> also i let them hang out at the store. and at the end of a long day, one of the young people said to me, bill, when, you know, went

to have good food, play video games and be treated well, we come here, and when we want to steal stuff, we go to 7-eleven so i mean, you know, you get what you invest. >> you get what you invest he's applying that philosophy in today's environment, a strong dollar is blunting the potency of international sales as you mentioned, economic uncertainty, lengthening sales cycles across the industry, but mcdermott says he's continuing to invest for growth at service now because he believes the company has loyalty and momentum with existing customers. we also says the business imperative to digitize for efficiency is going to continue even in a recession. >> we are a standard in the global 2000, but even where we're heavily penetrated in businesses that really lean on service now, we're only like 15% penetrated because service now has built so much innovation into the platform and the categories we just discussed that customers had a long way to go, so we have the highest

retention rate because customers love the product, and we have the best same account revenue growth of any of the sasse players because we keep innovating, so i think we're one of those special platforms that's on the short lift, and you're absolutely right. the projects that get invested in will have a quick fuse to value. nobody has the temperament anymore for multiyear projects with kind of like squishy roi. they want facts. they want return on invested capital, and they want to do it with a platform that's a winner and that's where we come in. >> different ceos have different superpowers, right i've talked in depth to hundreds of them over the years bill mcdermott is an apex communicator which includes marshaling facts and reading his audience if he's right about the durability of software platforms in a rocky economy, there are quite a few bargains out there if they could get snapped up and folded into something larger. >> how did he make the switch

from a deli with kids to what he does now, and to -- is wha is it s.a.p. where he spent a lot of his career >> well, his parents wanted him to go to college he wasn't that excited about it because he had this whole deli enterprise he was running. he agreed to do it would have a book behind the counter while he was, you know, cutting the deli stuff when the customer came in, he closed the book and would do the deli stuff. that helped him pay his way through college. then he applied for a job at xerox, which he ended up getting, that started his corporate trajectory he would see these folks in suits in town and see that was the way out. that's what he aspired to. >> you can hear the long island in his voice still >> there you go. >> i think there's a loft lessons to be learned in food service, you can apply it to a lot of different things. >> all right, thanks, jon. coming up, for investors tired of being whipsawed by the volatility, we've got the trade on some low volatilitytos, sck they're outperforming and steady cash flow. three stock lunch is next.

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it's time for three stock lunch. today we're looking at stocks that may offer stability in cash flow, what's been a very volatile few stock years highlighting stocks with low beta, stable yields and positive

returns. the list includes kraft, kinder morgan and abvie here is quinn tatro. quinn, let's kick things off with kraft. >> yeah, i like kraft quite a bit, courtney. it's not that common to find a staple that has a relatively healthy balance sheet. this is a company that has less than 0.5 debt to equity. earnings coming in at about 276 next year. way healthy, well enough to handle the $1.60 dividend. so you get paid 4% to wait on this one it's a nice company when warren buffett owns a 4% position as well so we're a buyer of kraft here. >> let's move on to something pretty far away from kraft, and that would be kinder morgan. >> yeah, tyler, if you think oil is not done going higher or not ready to go down, i think this is a good pipeline stock to own. you really need to be conscious, though, of where oil or where

you think it's going, because basically the company pays out its entirety of earnings through the 6% yield if all of a sudden it runs into problems and oil prices start to sink, the company has a pretty good amount of debt so that could be problematic and i would expect some beta there but if you are thinking oil is going higher or just not going to go down, a great yield and great way to play it. >> and a final name we're going through again, abvie. >> yeah. i'm not a fan. i know this is tough because a lot of folks like this one for the dividend we've had it in our dividend portfolio for a very long time but i'm not a fan of buying this company right here they have a tremendous amount of debt at this juncture, debt toic equy is 5 for every dollar they own, they owe $5 but the company has healthy earnings still on the backs of

some other drugs but just not a buy for me because of the balance sheet. >> makes sense, thank you, quinn. for more low volatility stocks with yield be sure to visit cnbc.com/pro you'll get the full list. macy's cuts its full-year guidance and say promotions are ahead. the stock is moving higher and we've got the details d an exclusive comments from the ceo next bubbles bubbles bubbles bubbles

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macy's up nearly how many percent right now, 4 or 5% here. yep, almost 4% after better than expected results for the most recent quarter but the company cutting its earnings and revenue forecast on fears that customers will cut back spending on discretionary items. the ceo telling me that inventory levels are a little high throughout the industry and, quote, we just expect margin pressures and high promotions to be with us through the fall season. you know what, ty, macy's inventories were only up 7%. kohl's inventory is up 50%, same thing with footlocker, so much better but he said some categories are just out of whack with inventory, things people aren't buying as much anymore but things we are chasing inventory in things like dresses and suits are still strong, beauty, luggage, gifting people wanting to get out, celebrating each other

they want to take their pajamas off and put on real clothes. >> i wonder if he's actually starting to see a little bit of a pullback or is he just anticipating. >> he says in general transactions are down but he's not seeing the trade down. so a consumer that might have spent something at $100 going for something as 50, maybe that transaction isn't happening it's just a trade down. dick's sporting goods are saying we're not seeing a trade down but are less worried about the balance of the year and increased their guidance macy's lowered theirs out of fear and dick's did the opposite. >> there are still supply chain issues i know my son is a big consumer of sporting goods. he's been looking for a certain brand, i'm not going to mention the brand, of football cleat and he can't find them he just can't find them. >> i asked dick's sporting goods about the supply chain and they

said generally things have evened out i wondered if some parents had not wanted their children to play football because of the injuries i said if you asked me before covid i would have thought that would have fallen in demand but actually football is really up right now. but he didn't say supply chain is an issue overall but maybe the cleats is. >> i think you're supposed to buy those cleats in may and not wait until two weeks before the first game to get it. >> sometimes we have to learn hard lessons >> let's switch subjects here. some business deals just make perfect sense and this may be one of them. amazon reaching a deal to air its thursday night football games. remember, we talked about that last week. going to air those games in bars and restaurants. now those establishments are going to get to show the games amazon gets to reach a wider audience it's a deal with directv we talked last week about their billion dollar a year deal to get exclusive rights to the thursday games now a new era. the nfl had previously always

wanted its games on tv so here is a way to expand that audience. >> absolutely. it is fascinating to see the transition as it's happening >> it's a very different year. >> as long as you play the game i want to see in the bar i'm in at the time. >> you are viewing lots of changes among the sportscasting and broadcasting crews it's going to have a different feel to it thanks for watching "power lunch," verybody. >> "closing bell" starts receipt now. stocks trading in a tighter range following the worst day for the major averages since june the most important hour of trading begins now welcome to "closing bell." i'm carl quintanilla in for sara eisen. the bulls latching on to these robust tech earnings but bears watching some weak macro in both europe and the u.s both sides wary of what the fed chair may say at jackson hole on friday check out some of today's big earnings movers. palo alto a big boost.