an environment where central banks are not on the same page. >> yeah. all right. falling dollar is better for multi nationals who want to get more dollars back when they bring them back. thanks for watching "power lunch". >> "closing bell" begins right now. a volatile day for stocks with a 400-point swing in the dow. the most important hour of trading starts now i'm sara eisen take a look at where we stand in the market, down 200 points in the dow. low of the day was 270 high of the day as you can see, we tried a few attempts earlier in the session, up 145 points. these negative reversals are becoming a theme lately. the s&p 500 down 0.4%. it's helped by the defensive stocks which are higher on the day. groups like real estate, utilities and health care. the nasdaq is under performing as treasure yields shoot up,

10-year yield past 330 and the nasdaq down 0.3% health care, one of the winners with names like johnson & johnson, united health and merck, leading the dow a deal cvs for signify health and traditionally a safe haven or a defensive place to go when there's worries on wall street coming up mark mobius on the recent weakness here and abroad where he's finding opportunities amid the volatility and we will discuss the outlook for consumer spending and inflation with the ceo of unilever, alan jope today's market dashboard, mike santoli tracking the pullback, down 0.5% on the s&p what levels are you watching >> 3900 the one that it's been toggling above and below for a while today. also in focus on friday the s&p was down about a percent and a half in the last few hours of trading on friday, so 3900 in addition to being a round number

is where the lower end of this range has been and we've only dipped below it in june and july so far it's defined the prevailing lower end of this range since about may. the other part of it is, it's kind of the uptrend from july's roughly right in there it shows you it's a little bit of a somewhat decisive area in terms of whether that rally in june is going to stick over sold conditions developing in stocks right here going up against those higher treasury yields and dollars and macro pressures we know about. that's why the market isn't down in a comprehensive or direct way. we are kind of over sold we should get some bounces in here that might be why it's holding together at 3900 if we were to go down a couple percent you would get more oversold and the makings of a better, not necessarily having to go down to the june lows. global bonds and stocks are walking each other down.

this is the global government bond etf so that's the price of bonds. yields going up. you see these times when yields led the way lower and stocks kind of caught down and this is the global stock index that suggests, at least, that it is still going to be a drag on what equities do globally. >> and data keeps coming in good services was a beat of a four-month high. the momentum in the data now seen as bad news. >> that's right. so we got a decent numbers at 10:00. the markets took heart and then yields flew because it does suggest that fed is going to see no real reason in there to let up on the 75 basis points pace and that is the idea that the fed is willing to break things along the way if it does so. >> mike santoli. >> let's bring in mark, founding partner at mobius partners do you see these trends continuing throughout the year how much worse is it going to get? >> yeah.

i still think it's going to get worse for a number of reasons. first of all, look at europe europe is in deep trouble and the european central bank will have to raise interest rates dramatically and the u.s. can't be left behind because you have a situation where the u.s. dollar will get too strong -- already the u.s. dollar is too strong -- so that's a real problem. the interesting thing is that some of the markets in asia, particularly indonesia, thailand, india, are beginning to out perform the u.s. market that tells you a lot about how those countries that are not impacted by what's happening in europe with ukraine and what's happening with oil prices to a great extent are going to do much better in this market generally speaking the picture looks very bad. >> so are you making the case for -- i know you always are invested in emerging markets and your fund has been tracking emerging markets -- but it hasn't looked that great lately. the stronger dollar is a headwind for overseas currencies, right?

the energy crisis, china being in lockdown with a very uncertain trajectory for a recovery it doesn't look that great when it comes to the cards stacked for emerging markets >> no. you're right if you look at the emerging markets index it's been terrible, under performing, and the main reason is because of china. it represents 30%. as you know, china is in real trouble. it's probably going to get worse there. but what we do is look at individual stocks and individual countries, so, for example, if you have indonesia out performing the u.s., you will find some stocks in that market that will do fairly well against the u.s. stocks. it's time now to be very, very picky in what you want to buy anywhere in the world, wherever you are, including the u.s so the indices look bad for emerging markets but individual countries in some cases are going to be okay. >> what about china? you have liked china before. have been investing in china

during some of the uncertain periods around regulation. they're still pursuing the zero covid policy and the tensions between the u.s. and china are getting worse. is it investble? can you invest there >> china looks bad, and we've had a less in china than we have in india and taiwan. of course, with the taiwan crisis we have to be careful about what's happening there as well generally speaking, the situation in china looks bad, not only because of the lockdown and the covid lockdown, but also because relationships with the u.s. and with other countries and the incredible dhaeebts tha have been run up not only in property but the belt and road initiative -- they lent billions to countries in africa and other parts of asia and even in parts of europe, so it's become a situation where the banks in china are going to have a real problem. i think the china market does not look very good.

>> what about europe are you putting any money to work in europe and any european countries with the energy crisis going from bad to worse? >> no. we're not putting anything in europe we think it's going to get worse before it gets better. don't forget, the winter is coming and things are going to get very, very tight it's not only about consumer prices, but also about industry. industry can't get energy in europe, and they have to start closing down or slowing down their pro duction. this is a bad scenario for europe. >> mark, thanks for joining us. >> thank you. up next, former saudi ramco executive on how opec's production cut and russia suspending natural gas supplies to europe will impact oil prices. later, an exclusive interview with the ceo of unilever on the state of the consumer and his strategy. the dow down about 180 you're watching "closing bell"

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. major heinz in the energy sector, russia cutting off gas flows from the nord stream pipeline until sanctions on oil end. opec and russia agreeing to cut oil production by 100,000 barrels next month joining us is former saudi

aramco executive vp sadad al husseini it's good to talk to you again first on the significance of the opec plus cuts, we haven't seen anything like this since the depths of the pandemic last month they were boosting production what do you think? >> well, good afternoon, sara. it's not a big adjustment. it's a 100,000 barrels out of a global supply of 98 million barrels. it's just an indication they're watching the markets very carefully and they're prepared to react, even if it's a small adjustment now the big problem isn't just now it's what's going to happen later in october and november when russian oil supplies get out of the market. that's when they will be poised to do a lot more right now it's a small adjustment. >> have you been surprised at how russian supply has held up despite sanctions? >> well, the russians have been very diligent and somehow managed to keep their oil flowing. a lot of their ships are owned by greek and cypriot ship owners

so they will be subject to the european regulations once they have to conform with the sanctions. they're doing okay they've had a six-month window to keep selling, but they're running out of room to market. it's going to be a real challenge for the market to replace the russian oil once it comes out of the market. >> obviously, this came after the g-7 is agreeing to cap the price of russian oil on the market is that something that you think will work, will inflict pain for those that go along with it that get cut off from russian oil >> this is a big deal because we're talking about the third largest economy in the world, which is europe, and we're talking about the largest gas reserves holder and nuclear power which is russia. when they come into a conflict like this, it can be a big issue for a long time. so trying to put a cap on

prices, i don't think it will work i don't think the chinese or the indians or anybody out there buying russian oil is going to want to see a price imposed on them they'll negotiate their own prices, but the problem is going to be beyond this. it's what you do in 2023, 2024 what do you do when russian oil and gas are forced to stay out of the market? the world is going to have to find alternatives. this isn't afghanistan or iraq this is russia this is a big deal >> where do you think this goes in terms of the impact on prices both in oil and nat gas and the effort to find alternative sources? >> yeah. what we've learned is alternative energy can't cover everything europe, between nuclear and alternative, can only cover 25% of the requirement 75% of the energy in europe is still oil, gas, and coal so that's going to be a reality for a long time, not just for

europe, but across the world and that means prices will stay high as long as the russian supplies and the rest of the world are at odds with each other. it's got to be resolved or we're going to see high prices for many years, well into the end of the decade. >> wti coming back, it was under more pressure under concerns of chinese growth sadad al husseini thank you for taking the time. >> my pleasure. >> do not miss tonight's special "energy emergency" for more on the outlook of oil and natural gas, tonight 6:00 p.m. eastern here on cnbc let's check on the markets right now. the dow down about 141 we recovered a little bit since the start of the final hour of trade. the s&p down less than a third of 1%. it is coming back. industrials popping into the green with health care, utilities and real estate. still ahead, bridgewater's karen tambour reveals where she's finding opportunities, plus wall

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. what is wall street buzzing about today? kanye west waging war on adidas. over the weekend he posted on his instagram account taking aim at adidas board members accusing the brand of making decisions about his line without his input and of stealing his designs. he's also taking aim at adidas senior vice president daniel cherry posting a picture showing a civil war between them previously west went as far as to post a mock "new york times" cover announcing adidas ceo casperwarsted's death on september 1st. west has been working with adidas since 2013. it's been a profitable relationship for the german company. in august last month, told me kanye is their most important partner worldwide, and he is very happy with the

relationship today, adidas is telling us no comment. this matters to investors. the line has becomom berg reports the brand is valued between 3.2 and $4.7 billion which also includes a smaller gap partnership. let's not forget famously left nike in a similar manner back in 2012 after reports the relationship was too difficult to manage. we'll see what adidas' threshold is here when it comes to kanye west the stock is down more than 50% over the last 12 months due to other factors like china and, of course, what's happening in europe when we come back, bridgewater's karen karniol-tambour joins us with her portfolio profession playbook and where she sees opportunity. she's worried about a stagflation environment. dow is down 132 and continues to recover off the lows we'll be right back.

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♪ ah, da, da, da, da da, da, ah, ah ♪ . take a look at stocks right now, down day on wall street the nasdaq down for its seventh day in a row longest losing streak since 2016 higher treasury yields, weaker euro and the energy crisis in focus. joining us is karen karniol-tambour from bridgewater

associat associates you still think the market is paint too long rosy of a picture of what's going to happen with the economy and fed. >> yes the market is just starting to catch up if you look at what you can see in the market pricing and you try to basically disaggregate what is the market saying, if you split out in the bond markets what are really inflation expectations relative to what are rate expectations and real yields the market is still expecting that inflation comes down relatively quickly, this inflation problem is short lived through across countries, europe, the uk and the united states, and if you look at the stock market and try to aggregate what's happening to earnings expectations and how much do we expect earnings to be hit by this and how much is the stock market down because there are higher interest rates you want to discount earnings at a higher interest rate of today markets aren't discounting bad earnings scenario. that adds up to feds that have to hike, but their hikes are enough to magically bring inflation down pretty quickly

and get an earnings outcome where we don't need a particularly serious recession to get things back on track and that's unlikely, not to mention that we don't have a huge risk priced in for what it's like to live through volatile inflation, stagflation, needing to ration those things are getting priced in which is why you're seeing terrible market action. >> you don't buy the idea that inflation is going to come down very fast, even though part of the thinking is if we get a recession and weakness in global economic demand that will pressure inflation even further? >> right you need to either get a serious recession, which is not really priced into markets and we know from the past there is a lead lag. it's not like the economy slows and a minute later inflation comes down we've seen it takes six months to a year to make its way through inflation. you get deep economic pain before inflation starts to slow and some of the i think overly optimistic views are that this

energy stuff will kind of just go away and not realizing how much it has second and third consequences if you need to ration what you're making in the economy because you don't have enough energy, that's an input into everything and now you have a supply problem that's more pervasive and longer term and slow demand even further and a deeper recession before those price increases stop spreading across the economy. >> it's a pretty doom and gloom scenario you paint of stagflation, which you've been warning ability for a while. in the past you said commodities are a good place to shelter but if you're worried about recession, is that still true? >> i think commodities are not great in the true stagflation nary environment for the reason you're saying when growth is weak, demand for commodities will slow at the same time and you don't want to be idiosyncratic in those the most squeezed stagflation is the toughest environment for investors, you don't want to be exposed not to strong growth and not to weak

inflation and most assets are and leaves investors with tougher choices of looking for inflation protection wherever they can and to me one of the easiest things you can do is change some of your nominal bonds to inflation linked bonds. everyone has a treasury. you might as well get paid whatever cpi ends up printing because there's a decent chance it will be higher than what is priced in. in addition to that, yeah, look around the world not every country in the world has as gloomy of a stagflation outlook as the united states places like china and japan look pretty different and so just diversifying what you're holding geographically gives you some access to other places where stagflation is less on the agenda than certainly in europe and the uk and in the u.s. in a different way. >> so china might not have stagflation here but it has other problems and some of them potentially bigger when it comes to geo pliolitics.

it's getting worse on taiwan, between taiwan and china, the u.s. make a move for nvidia, a certain ban on exports why is china a good bet with that going on, at the same time it's locking down millions to deal with video? >> i think the risks you paint in china are absolutely true, and cannot be ignored by investors, should not be ignored by investors it's matter of kind of diversifying your risks and not having your whole portfolio in wealthy country stagflation. the chinese risks are true, they're real, some of them have knock on effects on us if there's a serious heating up on taiwan that could hurt supply chains all over the world and with china you are getting compensated for the risks in a different way. if you basically say what do earnings have to do in china at a time where policymakers need to stimulate rather than need to cut back and, you know, make

sure that inflation doesn't get out of control but they can afford to system mu late, what do earnings need to do to break even talk about zero earnings growth relative to what you need in the u.s. and europe which is higher so you're getting the higher risk premium and different risks, everything you hold has risks in it, the diversification starts making sense and doesn't mean you don't think about the risks seriously and weigh them. >> got it. good to see you and check in karen karniol-tambour. take a look at where we stand in the markets ability 30 minutes left of trading. down 150 on the dow. we've still got four sects positive in the s&p, industrials joining that group the worst communication services, energy and technology. the concerns about the economy and higher interest rates. up next the ceo on unilever, whether he's seeing consumers trade down to cheaper products you can listen to "closing bell" on the go, following the podcast on your favorite podcast app we'll be right back.

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growth lots of pests. up next a top market strategist on the recent pullback and whether investors should be selling into any rallies. that story plus porsche going public and potential trouble for a spac seeking to merge with former president trump's media company when we take you inside the market zone. the dow down 219 we'll be right back. the best price on every trade, which saved investors over $1.5 billion last year. that's decision tech. only from fidelity.

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moments of the trading day looking at the broader markets the dow down 200, the nasdaq almost 1%. but there's buying and names that are working today for instance, in the nasdaq tesla is up, starbucks is up, some of the defensive groups i almost want to say it could be worse, given some of the headwinds that the market is looking at around europe and the energy situation we've got an ecb meeting this week, around the u.s. and the better economic data and higher treasury yields. what's your take >> could have been expected to be worse catching up on three days worth of pretty tough head lineds. not just the european situation with the natural gas turn off, china stuff not good news coming in i understand this is why we're, you know, we're down a little bit. it's lethargic the s&p, it was down 9% over the course of three weeks from that mid-august high, so we've done a good deal of unwinding of that rally we got in june that's one reason, perhaps, it's

not rushing floer a broad way today. >> i think some of the bears, i was reading mike wilson at morgan stanley, who has been pretty bearish throughout, says we're still going to make new lows in the fourth quarter that earnings expectations still have not moved lower enough to reflect the weakening fundamentals we will get if the fed raises rates on the other side the economy appears to be picking up steam or hold something momentum here despite the interest rate hikes. >> you can't disprove the idea that earnings have downside risk given we've seen slowing and given what's gone on, profit margins being pressured. more than two-thirds of the way through the third quarter, it's not as if the economic performance we can observe in the u.s. is something that would necessarily cause earnings to collapse for the third quarter yes, it always is a question of what the outlooks are going to be, we hear about the corporate conference schedule going on right now and whether that's going to be some land mines coming out of that, but i do think it's a good debate at this point. i also find it interesting that

people are comfortable feeling as if, sure, there will be a year-end rally, but you get chance to buy them lower from here or at least below the june lows it's plausible september is not friendly. the fed is tight noong a slowdown all the basic inputs into a broad market view suggest the downtrend has the benefit of the doubt here, but, you know, at some point it gets too crowded and requires new bad news to keep the downside case going. >> i don't know if you were listening to the interview with karen karniol-tambour, dire forecast in terms of the stagflation outlook, not priced in, inflation doesn't magically come down and the economy is going to get worse what's happening in europe, china, and with the fed. and that's a tough environment for investors. what do you make do you think the market is too rosy on that if we go into something more stagflation nary for longer, what who >> there would be further downside to valuations in that

scenario no doubt about it. i don't think we're priced for stagflation. however you want to define that. does that mean inflation goes down to 4% and growth struggles and get a stall speed, earnings flatten out or go down i think that would be hazardous for the market i think it's not a foregone conclusion that that has to be the path right now this cycle has not really obeyed the day dense on the way up or the way down of a typical one >> let's talk about fedex tumbling after citigroup downgrades the stock to neutral, analysts feeling bearish heading too peak delivery system weaker freight activity could impact growth this year. citi's price target slashed to $225 that still implies upside over a sharp decline over the past month and questions swirling about whether fedex's performance reflecting something broader with the global economy. what do you make of the call >> macro driven. kind of cautious about most of the group so it susisn't just a

fedex story and ratifying how the market has been treating fedex right now. not a lot of earnings growth expected this fiscal year or next a turnaround play if you believe in it at this point. dollar headwinds all the reasons you would think to be cautious on fedex are in this call, but again, it's calling for like a 10% upside would mean fair value based on citi estimation. i don't think it's desperate, but freight rates are going down it's good for the inflation story. it's not great for transport stock performance story. >> let's talk autos. porsche going public volkswagen announcing plan to spin off the sports car maker later this month or early october. the ipo could have a valuation up to $84 billion which would make it the largest european offering in decades. but it does come at a time when aston martin and ferrari have seen their valuations decline. robert frank joins us. the timing is interesting given what's happening in the luxury space, what's happening in europe how much investor appetite is there going to be for this ipo

>> yeah. sara, what's happening in the markets and with ipos very difficult time to come out with one of the biggest ipos in recent history certainly in the auto market. now on the bull case this is a chance to own one of the most storied names in the auto sector that gold porsche badge is a profit machine it's got margins of 22 to 25%. in the auto world that is massive. you know, they had -- they're expecting sales this year of around 38 billion euros onlyon production, but around 300,000 cars qatar trying to buy large blocks of stock on the governance side you have the family that's going to control this through a special block of voting shares the public shareholders will get nonvoting shares that's an issue. second issue the ceo of volkswagen will also be the ceo of porsche and for investors who really want these companies separate, it's a problem to have

the ceo running both companies the devil will be in the details, but this is a great brand, certainly, in the auto space. we'll see whether it's overpriced. >> why is volkswagen doing this now? obviously, you mention the ipo market has been shut down. why do they feel now is the time strategically for the parent company? >> well, there was a lot of negotiations with the heirs of the porsche family, so this has been in the works for many years. they've finally got that settled. the bigger issue, though, is volkswagen needs this cash to switch to evs. the investment on the ev side from all these companies is massive and they need the cash infusion from the spinoff to fund their ev side. >> got it. robert frank, thank you. the timing will be interesting. it's a large offering, happening over in europe at a time where we haven't seen too many large ipos it could be different just because of the name brand and

people like it, and it's an ev play. >> value in the most elite auto brands out there clearly. also when ferrari came public and split away from fiat chrysler it was in early 2016, industrial recession, valuations were depressed that is not necessarily something that makes or breaks a deal for the longer term there's an argument when an ipo does get done in a slow time for offerings in general when the markets are a little bit under pressure, it usually means that it's a deal people really want and, therefore, can perform over a longer period of time. does it get out and if so, are we valued at a pretty on demanding level because the markets have been tough. >> they have one thing going for them which is a weak euro which helps the translation on earnings. shares of digital world acquisition, the spac planning to merge with trump media and technology group, big loser on wall street today as you can see down more than 16.5% the company is now delaying a shareholder vote on whether to

give the deal a one-year extension until thursday which is the deadline to take trump media public according to a published report today, digital world has not been able to secure enough support for an extension leslie picker joins us what happens next and why the delay? >> basically they need a sizable turnout to get this extension approved they needed 65% of shareholders to vote in favor of this extension and as you know, dwac has a very large retail base which tends not to have the highest turnout when commit to corporate governance now they had two weeks to drum up enough support for this extension. they weren't able to do that they are now delaying it by two days we'll see if the media attention from today potentially throughout the rest of the week will do the trick, but clearly, the market is getting a little concerned they will be able to get this deal done, given all the regulatory scrutiny. that's why they need the extra

time to complete the deal. >> got it. leslie picker, thank you. the unilever ceo speaking at the barclays consumer staples conference today is seeing trading down among consumers including in the americas where people are swapping out, for instance, body wash for bar soap but also there's pockets of strength including e-commerce where he is seeing customers add on to pints of ice cream, for instance, on their uber eats orders joining us is unilever ceo alan jope it's good to talk to you, given you have a broad reach across food and household products. what are you seeing globally right now from the consumer as we monitor how they're holding up in the face of a lot of macro economic challenges? >> you bet hi, sara thanks for having me i mean, unilever is quite a different company from where we were three years ago that we were entirely focused on growth. we're not tied to a long-term margin commitment. we're executing with more discipline

we've made clear strategic choices and we find ourselves in a position where we're quite well equipped for the continuous volatility we're living with it's wrong to make sweeping global aggregations and generalizations. what we're seeing is continued strength in asia, particularly south asia, our business in india is doing well. the consumer there is holding up well similarly in southeast asia. latin america and africa continue in difficult circumstances to deliver strong growth we've seen the u.s. to be fairly resilient. i think high household savings levels and the fact that we've not yet reached peak inflation means the u.s. is doing well and europe has been one of the softer parts of the world. by and large, there is a limited down trading the example that you gave are people moving from body washes to bars is an exception rather than a rule. i think we're going to be in a

period now where we will have to watch carefully as the northern hemisphere starts to endure winter heating bills as costs start to peak and as household savings are being depleted i think the next few months we're going to have to watch carefully. >> you said something about inflation not yet peaking in the u.s. is it your view that it's going to get worse what's happening with your products and your categories >> let me restrict my comments to our business where the basket of commodities that we use across agriculture, raw materials, pet trol chemical, freight distribution, logistics, we are not seeing an easing off in our costs in those types of commodities and so i'm afraid any early optimism that inflation had peaked and was behind us is misplaced

we will -- we anticipate that we're in this for a few more months yet. >> so are you continuing to raise prices on products >> yes we are we will continue to take sequential price increases. >> you mentioned at the top that you guys were in a different spot and i know you've been making a lot of strategic changes and going through a restructuring. still over the last year, the stock has under performed and down about three times as much as procter & gamble and even more than that of nestle, some big competitors. why is that? >> yeah. i think if you look over the last six months you see quite a good rally in unilever stock what we understand is that the market is valuing consistent, steady growth. in a couple years ago, we had one or two too many surprises for the market and we're really focused now on that steady,

reliability of top line organic growth and as we've delivered that over the last three quarter, we are seeing it reflected in investor confidence in the company and in the strategy that we're following. >> how is it going with trian partners and nelson peltz? what have those conversations been like? >> we brought nelson on the board because of his track record in the consumer sector. we're enjoying an extremely collaborative relationship nelson, like our other board members are keen to see the trapped value in unilever unlocked we think we're a business that's under valued one area in particular where we've enjoyed the engagement with trian we're moving into a new, simpler organization. we've ditched our metrics organization we've had for a couple decades and now running the company end to end through five simple divisions and that enjoys a lot of support from

trian and nelson and he's keeping the pressure on us to make sure that we realize all the benefits of that simpler organization, specifically the improved accountability that it brings. >> i mean, this is the strategy that he helped create, the structure at procter & gamble. is that the kind of structure that we're talking about that you're adopting? >> i think, yes, it's similar. trian, like many investors, has what they think works on a particular sector and what trian are seeing from unilever mirrors some of the success they've enjoyed with other very successful consumer investments they've made in the past. >> really quickly, alan, on ben and jerry's, we've been following the news, they're suing you because they don't want go through with the israel sale to the franchisee should they scrap their lawsuit and have they gone too far >> that's for them to decide,

but it's too late. the sale to the israeli franchisee is closed and we wish them luck with their business in israel we're back to focussing on making great ice cream in vermont and championing causes that are very important to ben and jerry's, like climate change and equality we're thoroughly enjoying having ben and jerry's in the portfolio and the situation in israel as far as we're concerned is closed. >> alan jope, thank you for joining me it's good to talk to you from the barclays consumer conference we're going to have more on the state of the consumer tomorrow an interview with the ceo of kelloggs steve kahillane he's in the process of breaking up his company into three companies, cereals, snacks and the plant-based foods. stocks are lower into the close. there could be worse to come bring in kristen bitterly at citi global wealth

it's good to have you. what should investors be doing on big sell-off days like today? seven in a row for the nasdaq? >> i think right now we need to play a little bit of defense and that's something we've been doing in our portfolios being very balanced across both fixed incomes and equities and leaning into quality parts of the market unfortunately, i think the market is trying to find some signs, some dovish signals, signs, look at the jobs report, maybe that was goldilocks, but ultimately we are in an environment where there are tightening financial conditions and that is going to impact the consumer and it is going to impact earnings. that's not something that we would have seen in q2. that's something we're going to see with the fed's trajectory going forward. we are cautious here. >> i guess a pushback on something you can point to, i'm not sure how much of a bullish argument it is, positioning is light again and people are getting very bearish again, and last time that happened, we saw, what a 17% rally in the market in mid-summer. >> that's absolutely right and i think it's one of those

things from a positioning standpoint if there were something to turn, you would see maybe a pretty fast rally off the lowe's that being said, where the market is pricing right now it's not pricing in a recession it's not pricing in any type of earnings contraction as well, so that's why it's not a function of not being invested in the market, it's picking your places in the market. if you have equity exposure leaning into quality and some of those sectors that are resilient in recessionary environments like health care, like consumer staples and then balancing that out with some quality fixed income where now you're earning yields that far exceed the dividend yields in u.s. equities so having that balance is a way that you can benefit from some of those bounces, not to the extent that we saw, bill stbshs but still have skin in the game. >> why do you like health care and staples over real estate and utilities? >> so i think health care is one of those areas it's an area that we've liked for some time. it's, obviously, held up well and it's a favorite of many people for that reason i think when you

look at if we are nervous about earnings contractions, if we are nervous about that tightening of financial conditions, you need to look to places in the market that have inelastic demand health care provides that. when we look at the past three recession nary environment health care has been one of the few sectors that has been able to consistently grow their earnings for that period of time that's where we're very specific we want that inelasticity of demand in terms of where we're picking our spots. >> thank you for joining me with some of the advice you are giving to your clients just under 2 minutes to go here just over that, mike, as far as the defensive stocks that kristen mentioned, real estate and utilities are working today. what do the valuations look like if you are feeling like you want to take an opportunity on the sell-off to get more defensive. >> you're paying up for the privilege in a sense in most of those areas. real estate is -- has been tougher but utilities never really looked that great based on standard valuation metrics.

they're bought for the safety as opposed to the earnings they're going to deliver the leverage to natural gas has helped out a little bit. you look at consumer staples, there again, you have to generally pay a bit of a premium there if you want the smoother ride it has paid off and people have been willing to do it. what's interesting to me, that type of thinking and those flows have not made their way toward what we used to think of as the more reliable areas, which were some of the big tech platforms and things like that, which got too expensive. people don't want them yet. >> tesla is higher, starbucks, lululemon adding 4%. what you seeing in the market internals? >> softness there. we've been toggling mostly below the flat line all day and it's more than two to one, 2.5 to 1 pretty consistent at the index level there. take a look at the communication services sector. made a new low today actually as a group while the s&p has not made a new year to date low.

you talk about traditional defensives the telecom, cable stocks really look awful right here. people are concerned i think about things like cord shaving and cord cutting comcast, charter, all those things not working and then meta and google are also relative under performers that's an area that probably is starting to look statistically cheap, i would imagine volatility index not doing much. perked up into the 26s it's elevated, not panicky we had a little bit of a monday rebuild in volatility, but you see that chart there, shows you higher lows and we're in between panic and concern. >> that's sort of what jives with what the market is it telling you, concern but not pandemic the dow into the close, down 165, we've come off the lows as well it's been a bumpy ride in the final hour a few attempts to go positive earlier, up 145 at the highs didn't work. united health, visa, boeing, the biggest adders to the dow. what's hurting the dow, goldman sachs, 3m, microsoft, most

stocks are lower s&p down 0.4%. the defensives are working utility, health care, real estate, industrials are positive on date. communication services, technology, weaker, along with energy off the back of oil prices and materials the nasdaq down for 7 days in a row. that's it for me on "closing bell." see you tomorrow we'll send it into "overtime" with scott wapner. all right. thank you very much. welcome, everybody, to "overtime. i'm scott wapner you heard the bell we're getting started from here at post nine at the new york stock exchange in just a little bit i'll speak to eric jackson, why it's time to buy that space even with the nasdaq on this long losing streak speaking of, we'll get you set up for apple's big event tomorrow out in california what it means for the stock which some say right now is the most important in the market. we begin with our talk of the tape nothing but negativity that is pretty much what you hear from almost every investor you talk to these days are things that bad?