san francisco, san jose and the new york city metro area as well so, interesting data from redfin on that. >> fascinating thank you, dom appreciate that. folks, be sure to check out delivering alpha tomorrow. i'll be there. i won't be with you, sadly. >> you know what, sometimes you have to ditch me for the big - >> hardly. >> movers and shakers. thank you for watching "power lunch," everybody "closing bell" starts now. another early rally attempt failing on wall street the dow giving up nearly 400-point gain the most important hour of the trading day starts right now welcome, everybody, to the "closing bell. i'm melissa lee in for sara eisen. it's been a wild session with stocks trading in a broad range. comments from chicago fed president charles evans helped drive an early pop in stocks particularly when he said he was a little nervous about the lagging data >> there are lags in monetary policy we've moved expeditiously.

we've done three 75-basis point increases in a row and there's talk of more to get to 4.25 and 4.50 by the end of the year. you're not leaving much time to look at each monthly release. >> that rally faded by midday. they had given up sizeable gains. allianz chief economist pegging, as feared, higher yields on u.s. government bonds have eroded what was a 2% bounce in stocks serves as a remind that's true a stabilization of the treasury market is likely to be needed to establish a sustainable floor under stocks, all of which keeps the markets' focus on the fed. we'll hear more from mohamed when he joins us live. bonds are becoming more attractive to investors like jeffrey gundlach who tweeted he's been a buyer of bonds, quote, unquote, recently joining us is deputy cia jeff sherman. great to have you with us.

>> hi, melissa good to see you today. >> hi. in a world in which there was no alternative for so long, there is an alternative at that point. i'm wondering how you view that opportunity right now for incresters >> yeah, i think mohamed's quote is correct all volatility runs to the bond market right now we've seen a very hawkish fed. not only was the fed hawkish at the meeting last week, but it kind of out-hawked themselves. you know, chairman powell was committed to the dot plots he's talking about they have to be forced by inflation and the bond market did a 180 from the interpretation we saw back in the july meeting where they interpreted the fed -- the fed chairman's comments as being dovish so, we've seen a massive repricing in the bond market not just in the last week or so, but really since the -- kind of the local low in yields on the 1st of august. just to put it in perspective, yields are up something like 140

basis points on ten years. the two-year is up over 150 basis points so, you're starting to get to the perspective of where, on a forward-looking basis, if you believe that the inflationary environment is on a trajectory to be contained and what's priced in the bond market, there's significant value in real opportunity that is return opportunity that can outstrip inflation over the next couple of periods so, from our perspective, we've been adding to our treasury positions to offset some of the credit risk within our portfolios just as an outright trade. the bond market's very oversold right now. if you look at relative strength across the curve, you can see just this carnage you've seen over the last week and a half or so and it really presents a buying opportunity. so, investors, like the fed, i like mohamed's comments that the fed is being backward-looking at inflation. the inflation data we got is the inflation that has transpired.

it's not the inflation data we have on a forward-looking basis. i think there are significant opportunities out here yields are to incredible rates we haven't seen since back in 2011 there's significant opportunity out there, and i think for investors that are timid and worried about the path going forward, there is a good opportunity to put together high-quality portfolios that can achieve some of their income and return objectives. >> the notion that u.s. treasuries present an opportunity, i think, a lot of investors can stomach. the idea that europe presents an opportunity is something, jeff, i think a lot of investors may not be able to stomach because the rise in yields may signify something else when you take a look at uk 30-year popping above 5% for the first time since 2011, or whatever it is, that signals the fear you're not going to be paid back later on. it's a whole other mess ak where you have yields go higher.

i wonder where you see that opportunity in europe. >> from that perspective, i think, you know, the uk still has some challenges. especially with all of the budget talks over the last week or so. really, you know, that they're going to try to stimulate here through tax cuts the market didn't want to hear that but i think some of the pain you've seen in the rates market here in the u.s. this week, or at least yesterday and today, is some of that selling from uk investors. they own treasuries. they were selling them to -- essentially they don't care about the level they sell back because the currency move way outclips the rates market. the standpoint of thinking about some of the pressure we've seen in yields here, it's because the world has been long the dollar they're trying to sell that to protect that currency as well. really europe doesn't really offer significant opportunity at these levels right now we'd be cautious on that the u.s. is the place to be. the u.s. is the carry trade

right now outside of the uk, as you pointed out, and it's a high-quality asset for u.s. investors, we think they should remain focused on the u.s. bond market today. >> last question, jeff what are you seeing in the credit markets a lot of people on the equity market look to the credit markets to see if there's any cracks, any signs there's stress what i notice in the notes thaw gave to our producers, liquidity continues to be poor want that there's less there's less liquidity by the fed's design, but that liquidity is actually poor how poor is it is it getting worse? >> it's poor in terms of bid/offer spread talking with our desk this morning and talking to the credit traders, it still is pretty orderly in these markets. yes, the bids are a little wider on assets out there, but there are significant bids across the credit spectrum. from a standpoint of liquidity, it may not be the price you

want, but there is liquidity in the market right now and so the liquidity has been poor, but this is also by design what i mean by that is the fed is tightening policy they're raising interest rates we all know that don't forget on the back end they're also doing quantitative tightening they're removing liquidity from the system this shot north with the dollar really over the weekend or so is also exacerbating some of those challenges with liquidity right now. ultimately this is kind of -- really it falls into the plan of what the fed wants in tightening conditions in general. but when we look at credit markets, they are behaved. they may not be the price people want if you look at like the largest etf out there in invest rate corporate bonds, it's now down more than 21% year-to-date some of that has to accdo with credit, some has to do with rates. the widening we've seen in corporate spreads and across the credit markets in general is commensurate with the rate

volatility we've seen. it may not be what investors want to hear from a standpoint of looking at credit but if you're calculated in the way you look at it and you're willing to take that risk, some of these investment grade parts of the market do look attractive they have recession risks. what is an investor to do? you can get double digit yields out there but you can pair it with the trade we start with we can talk about the treasury market, build portfolios to withstand some of that volatility the credit market is one of the most interesting places it's been in over a decade. we think investors concerned about equity markets, potentially they should look at some of these credit markets, putting some of these ideas together and building yourself kind of a portfolio that can weather the storm that's forthcoming from the fed over the next six to nine months. >> jeff, thanks for your thought. great to speak with you. >> great to see you. thank you. we're following a number of developing stories in the energy space today. first up, nat gas and suspicious

leaks in a pair of pipelines carrying russian gas pippa has that story. >> we're talking about the nord stream pipelines they have been hit by three different leaks at once raising suspicions of sabotage the swedish national seismic office said it detects two blasts they're certain were explosions rather than an earthquake this does not interrupt supplies right now, given that neither pipeline was actually carrying any gas. gazprom had already cut flows via nord stream 1 and production on nord stream 2 was halted earlier this year. it raises questions about future flows, especially heading into winter antony blinken said sabotage of the pipelines is in no one's best interest but rbc said this could be a burning down the house strategy with more infrastructure potentially at risk >> wow we also want to talk about oil and the impact from hurricane

ian. it's poised to strike florida's gulf coast what's the impact on crude so far? >> at the moment we're not seeing that much of a response hurricane ian is nearing florida but missing the panhandle, missing much of the u.s. production in the gulf of mektsco. about 190,000 barrels of day has been shut in, according to the bureau of safety and environmental enforcement. that's about 11% of the gulf's total production but the u.s. produces more than 11 million barrels per day so, this is really not a meaningful number. the regulator added that a total of 12 oil and gas platforms have been evacuated, including by bp and chevron. bp said this afternoon that the storm no longer poses a significant threat to its assets in the gulf and it's working to redeploy its offshore personnel. once the storm makes landfall in the u.s., this is quickly going to turn into a demand/destruction story florida is a big consumer, so while gasoline futures are up

about 4.50% today, he does not anticipate those gains holding >> pippa, thank you. pippa stevens. the s&p 500 now trading at levels not seen since november of 2020 after the latest round of selling chart expert chris verrone with the levels you should be playing right after this break

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the s&p 500 on pace for a new closing low after finishing before the june levels

joins us is chris verrone, a partner of strategis, a baird company. 3636 is in the history books what's the next level to watch >> there's modest support in the 3500 neighborhood, but our view all year has been that the market is going back where it was pre-covid. that's 3200 s&p. our big issue is the market is not that oversold. right now the s&p is about 12% below its 200-day moving average. historically you need to get that close to 20%, 25% to make a big oversold call. that's what we saw in the '70 low, the '74 low, the '09 low. the top of the market here is really where the risk is

look at the stocks that broke down first it was microsoft below its june low two, three weeks ago this is top-heavy. i don't think we're through it. >> is the further breakdown going to be driven bit bigger stocks in the s&p? the fundamental argument is we haven't seen the next shoe to drop when we haven't seen guidance from some of these companies. from google we haven't seen enterprise demand, for instance. what do you see in the charts? >> when you look at the progression of this bear market, this began in spring of 2021 with the ark stocks. then they hit what we call the almost faangss, names almost considered faangs. the stocks that drive us lower from here over the next several months are big waves i think it's apple, microsoft,

google, i think amd, nvidia. fair markets are a function of price and time there are certainly a lot of stocks here down a lot but we really haven't seen this from a time perspective long enough if you agree with me on the s&p up or down, i think the biggest story is time. this will take time, measured in quarters, maybe years to repair so many broken charts out there. >> in a world in which the s&p 500 does go to 3100, 3200, are there sectors, are there stocks here that are relatively defensive, or is everything off the table? >> i think the trick here it's almost shades of fall of '08, that climactic move lower were the defensive groups viewed as untouchable. i remember the summer and fall of '08 it was the walmart and exxon that drug you lower.

i think you have to be careful with defensive groups. a lot of money has moved into staples and utilities. they are not particularly attractive from value perspective. the final phase of the bear market tends to be when they hit the defensive groups you look at staples or utilities, they're still outperforming but only because they're going down less. if you look earlier in the year, they were outperforming and going up i think there's risk to defensive groups going forward. >> shades of '08 sent shivers down my spine, chris good to speak to you, nonetheless. lets get a check on the markets and where we stand as we head into the close. the dow is down by 0.3%. down by just 0.2 on the dow. after the break, we'll talk to the ceo of a rare year-to-date tech winner. shares of cyber security firm qualys the ceo is ringing the nasdaq bell

as we head to break, check out the cruise stocks having a decent session carnival, norwegian all outperforming.

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higher but weak and down more than 30% in 2020 one bright spot, cyber security. check out qualys in the green this year, up 3% companies are beefing up cyber security as work from home continues and cyber hacks have stayed in the news uber and take2 both hacked joining us is qualys president sumedh thakar. thank you for joining us. >> thanks for having me. >> i wonder what you're seeing and what you're projecting in a recessionary environment let's say there is, in fact, recession. we're hearing about corporate layoffs across the board if that translates into higher

unemployment rate. how do you think about that as it affects your business and revenues >> i think you have to look at how the market has evolved in the last few years we had a lot of companies use digital transformation and technology as a way to bring more productivity into their business i think in a challenging macro economic environment, companies will look forward to leveraging i.t. technology as a way to bring more efficiency, be more productive and bring more automation so they can do more with less. and cyber security becomes an enabler of that. i think that is how i see moving forward that -- and why we have seen today the robust budgets for cyber security continuing because i.t. spending is something organizations are looking to leverage in the digital environment. >> let's say simple head count goes down, does the spend stay the same at a company? >> the way that you -- today already in cyber security

specifically, there's not enough people and we hear that all the time, right, there's not enough qualified people in cyber security the focus for companies have already been on how to leverage more automation and leverage more cyber security platforms like qualys, which can bring multiple capabilities into a single approach. with automation and security, can you reduce the reliance on having to have put more humans on doing tasks you can actually have more automation that can get rid of the cyber security tasks and focus fewer humans you have on tasks that require a human intervention to look into what's going on in the environment. >> i want to -- i want to see what you're seeing right now, sumedh i'm not going to pick on the second quarter because that was a great quarter. it was a beat and raise kind of quarter in terms of ccb, it was up 18% year on year but you did see a quarter to quarter decline.

i'm wondering what you're seeing quarter to quarter and what the trend is. >> we're happy in terms of the acceleration we have seen in the business to come to where we were last quarter, obviously, 20%. margin of 40-plus percent on ebitda we run a profitable business we have $500 million on the balance sheets today, which is a rare thing in the cyber security stocks as we stay cautious with macro economic conditions and we continue to leverage the cash that we have on balance, we invest in the right ways and to look for opportunities to see how we can continue our profitable growth. that's really our focus right now. how can we add more value to our customers so they can do more with the qualys platform that way we can continue with having growth but with the profitability we have. >> so, the trend is still good that was the question. the trend that you're seeing in terms of billings growth. >> yeah. the trend we're looking at, billings is something we continue to monitor and wie look

to see how we'll do for the next guidance at the beginning of the year >> okay. great to speak with you. thank you. sumedh thakar. >> thank you after the break, mohamed el erian weighs in on the downside reversal and if he would be a buyer of stocks with multiyear lows stay tuned

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a check on the markets right now. the s&p 500 has taken out its june intraday low. we're trading at 3644, down 0.3% on the s&p the nasdaq is trying to finish out in the green with a four-point gain. joining us is mohammed el erian. great to speak with you again. we pay attention and watch the equity markets but a lot of the action is in currency as well as fixed income these days. what we're seeing overseas, i think, is really shocking and we may not have paid attention as much to it today, and we should. that's a move in the uk bonds, uk gilt. the yield on the 30-year, you tweeted the levels we have not seen since 1998. dalia tweeted levels we have not seen since 2002. whatever the year is, we haven't seen them in a very long time and we're seeing the ripple effects here can you walk us through what those dominos are. >> so, uk 30-year yields, 5.04%,

we haven't seen that for a long time they moved 100 to 125 basis points in three trading sessions, so that's massive. mel melissa, the general story is a simple one yields are in the driver's seat. and in the backseat are stocks and now fx so, depending on what yields do, everything else follows. and what we need desperately is a stabilization of yields. and we haven't had that. we've had a relentless rise. part of it has to do with the fed. part of it has to do with technicals and part has to do with people stepping back. what happened in the five-year auction today was very informative. >> what does it tell us, mohamed, that yields around the world are going higher all at once if there's not a safe haven trade, let's say, uk debtholders selling their uk bonds and seeking safe havens in other government bonds, we're not seeing that in the u.s we're seeing bond yields spike

here as well >> yeah, so it's different stories. i do think in the case of the uk, in the case italy, there's a sovereign risk story there there's an issuance story there. in the case of the u.s., it's a fed story. we've had a fed that made mistake number one, as you know, embracing transitory, falling way behind the curve and now the market senses that we are in the second part of that mistake which is the fed has dug itself into another hole. this time by being hawkish and being unconditional but looking at lagging variables so, what the market is worried about is the fed will continue hiking and will go too far because it's looking at lagging variables. why? because it's trying to restore its credibility. and that's what's pushing yields

up, especially at the front end in the u.s that's why the five-year today was a really poor auction. i would keep an eye on that because that has significant technical spillovers >> especially if the fed is starting to sell and there are no buyers on the other side. i mean, that's a problem down the road mohamed, you know, i've had the pleasure of speaking with you on "squawk box on friday" yesterday, friday and on "closing bell" today three days in a row. it's one thing to talk about extreme moves and the impacts in one single day but this is three days in a row we're talking about these sort of similar ripple effects of extreme moves. do you feel any worse about the market or the damage that is being done to the markets after three days of these sorts of movements we've been watching as opposed to just a single session? >> yes and no. first, i think we are causing

technical damage to the markets. i think people are more hesitant i hear nothing but complaints about liquidity. remember, you're talking about the most important markets in the world. and they are having technical issues, they have liquidity issues yes, i feel worse because this accumulates. the plenty surprise is we haven't seen anybody really get offsides not of yet, at least that surprises me. it seems risk management has become much better let's hope in the next few days we don't hear of any accidents but those sort of violent moves have tended to cause quite a bit of casualties in the past but we haven't seen it this time. >> it will be interesting to see in the weeks and days ahead if there are casualties, especially funds blowing up and that sort of thing we talked to chris verrone, he said 3100 could be in the cards. are you that bearish do you see further downside even from there >> look, i see value

i'll tell you, there are times i really want to buy but i also respect what's going on we're going through these major paradigm changes, not so much in liquidity but economic paradigm. the technicals are terrible. i would like to see a few days of really good stabilization and i don't mind missing some of the upside, to tell you the truth, until we have greater confidence we're starting to establish a floor. right now the market is so tentative that i would rather stay on the sideline i'm tempted but i'm trying to stay disciplined and staying on the sideline for now. >> we'll see if mohamed can be four for four tomorrow >> thank you let's take a look at where we stand in the markets. s&p down 0.50%, 3640

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welcome back we're in the "closing bell" market zone. barbara is here to break down crucial moments of the trading day and phil lebeau on tesla and a warning about mcdonald's let's get straight to the markets. off the lows, the stock market rout extending to sixth straight session today. the s&p 500 hovering as levels not seen since november 2020 if it closes lower, it marks the longest losing streak since february 2020. barbara, we took out a lot of important levels in terms of june levels. i'm wondering how you gauge what the market damage has been so far. >> well, i look at the portfolios and it's not pretty, but it hasn't been you know, for a lot of the year. certainly technically a lot of people are very concerned, internals and all those kinds of measurements are not looking attractive when you look at where the market has come from, it's down past the lows of june.

the concerns are now about earnings because the fed has embarked on the most aggressive rate-hiking cycle we have ever seen i think we're setting up for entrance into third quarter earnings i think earnings will be okay. there will be some disasters that will be taken down but i don't think there's going to be a wholesale decrease in earnings estimates which is what the market is discounting. i don't know where the bottom is i think we have to be close, although i said that in june but i think somewhere in here, a lot is discounted in the market right now. >> are you buying these days or are you waiting? >> well, i'm waiting basically as i am fully positioned and i have bought intodown turns what i would say is now you don't sell stocks certainly here but if you have cash on the sidelines, this is an excellent time to start picking up real bargains you can throw out great

companies, people don't know where the bottom is and you can nibble on very good names. >> those those results ahead of the delivering alpha investor summit tomorrow. do you like those sectors? >> well, it's interesting. i like the health care, i think, is a good defensive play when you have rising rates and uncertainty in the economy financials would be last on my list and the second one -- what was the other one? you said health care and >> energy. >> yeah, energy is interesting i don't invest a lot in energy, but certainly i think energy will outperform. it's at a nine-month low you have limit supply. hardly any spare capacity. inventory and as the world economy starts to recovery, which is not just at the moment but some time next year, i think you will start to see a

reflation. i think energy could do very well instead of financials i would prefer big cap tech. they are all down dramatically, 30% or more. meta down 60%. i think those are names that when they turn, they will turn big. growth is going to be scarce and these names still have a lot of growth and long secular runways. >> why don't you like financials is it the thought we're going to go into a recession? >> i think in financials you have to make distinctions. there's the paypal, the finteches of the world you have multi-capable banks like jpmorgan. they're in trouble in terms of trading side, and then the big regional banks, which should do well in terms of interest rates. but i think now you're starting to see moves in some of the banks that should do well. the question is, what do you see over the next year and i think they will not perform as well as these other three groups. >> let's get to tesla now. that stock bucking the market pullback on reports the company had called for an all hands on deck atits warehouses to

fulfill a surge to end the quarter deliveries tesla is a key holding in ark innovation etf. >> we're pretty excited about the next five years. i think this year there will be almost 8 million evs sold around the world. we think that goes to 60 million in five years. and we think tesla is in the driver's seat. >> let's bring in phil lebeau for more phil, we hear this at the end of every month, every quarter, that is. >> yes, we do. >> all hands on deck so - >> i don't think that's the reason the stock moved higher today, melissa we do hear this practically every quarter we hear, everybody's got to get involved. we have to make deliveries we can have a big quart fer we put our efforts into the end of the quarter. that's fantastic it doesn't mean the quarter is any any better or any worse than what people were previously expecting. and oh, by the way, when it comes to third quarter

deliveries, tesla is expected to have its best quarter ever i think that's part of the reason why the stock has been moving higher. >> phil, in terms -- it's amazing they still say, come on, everybody, help us with these deliveries when it's such a large company and they -- the numbers are so much larger than when they first started doing this in the parking lot in a tent >> sure. but i've had friends who have taken delivery near the end of a quarter. one friend in chicago had to go downstate illinois almost had to go to st. louis because that was the best place to take delivery of the vehicle. i think this is the way tesla has operated and will continue to operate probably for the next several years maybe. who knows. but it has been effective in terms of them being able to have a surge of deliveries at the end of the quarter and i'm not surprised we saw this memo saying, all hands on deck >> do you think, phil, do you think it has weathered the supply chain issues that have

hurt ford and gm more and are reasons -- tesla just -- it hasn't come out and warned it hasn't said it's had any issues with the quarter in terms of demand or fulfilling orders why do you think that's so, even now? >> well, they've done a much better job managing their supply chain than any other automaker that's been the case here for several quarters where there have been some issues, melissa, and we've talked about this, is china because of the issues with the covid shutdown and the inability to either produce and/or people being able to leave their homes in order to take delivery. it looks like most of that is in the rearview mirror now for tesla. and one reason why cathie wood is so optimistic about tesla is they have the manufacturing setup. they've got the pipeline setup they have the best position right now in terms of the growth of electric vehicles for the foreseeable future could be different in three or four years if you look out in the near term, tesla is in the driver's seat, as she mentioned

>> yeah. barbara, you have a small position in tesla. i'm wondering if it's -- well, obviously it's probably because it's a market leader in evs, but at this point, you know, high multiple stocks won't necessarily be in favor in a market like this and when does that concern enter the equation in terms of how you handle your tesla position >> i agree i have not been a long-term owner. it was always expensive and it is still expensive the small positions i established were on major drawbacks and some of these market drowndowns over the last nine months. i have not gone whole hog and i will not even though i think their long-term story is very positive i think the whole entire ev market will expand they may be able to maintain their leadership they have a lot of competition coming in. the pile will be so big, they'll do very well the question is, when do you buy this tesla only on major drawdowns do you add to this because it's

expensive. one of these high growth names that can grow into their pes but this one has a lot of fences to jump over so it can grow into it >> all right phil, thank you. phil lebeau on the tesla story today. mcdonald's, by the way, the worst performer on the dow today after citi issued a 90-day negative catalyst watch on the stock. weakening economic headwind are two reason to be cautious. john tower making that call. it's not often an analyst makes a 90-day call. what do you think is going to transpire in 90 days and how do those negative catalysts get resolved at the end of the window >> yeah, the 90-day catalyst watch is really just the street coming around and investors coming around to the idea that the operating environment for the brand in europe is going to become more challenging, not only from a top line standpoint but also on a bottom line standpoint i think the ceo even alluded to this two weeks ago at a

conference in chicago. on top of the fact that fx headwinds are not necessarily being accounted for in street estimates today. we think come the third quarter earnings call after that, the street will likely readjust their numbers lower going forward and reflect the fx headwinds and the operating environment that's about to come in europe for the brand. and the reason we call out mcdonald's here is the fact that they do have greater operating exposure to that market relative to any of the other brands in our universe so, it's calling that out. go ahead >> in europe, you see -- what are the major forces in terms of headwinds in europe? is it consumer demand waning, is it inflationary pressures whittling away at margins there, the inability to raise price as fast as inflation? >> it's all of the above the company's going to take as much price as they can while still trying to promote the

value message. an important part of the research we did today is taking a look at how the brand is positioned in those markets relative to other service chains and independents and unlike the united states where they hold a fairly significant value, in the markets they don't have that same type of price positioning relative to the consumer -- or relative to other competitors in the market so we think there's a little risk on that end to your point, rising energy prices are likely going to crimp consumer spend on top of that, the company has greater operating exposure in the market so their own stores are likely going to feel more pressure on the -- their own margins in that market therefore, profits are likely going to slip a little bit going forward. that doesn't appear to be reflected in street numbers today. looking at the numbers for '23, the street's essentially suggesting there's going to be a step up of 300 to 400 basis points for same store sales growth all the inputs we're seeing

regarding consumer demand across many of the major markets in europe suggest that things are rolling over now and likely going to start worsening as the winter months come along >> what's your outlook when it comes to asia? we heard earlier this week, maybe late last week, that mcdobld's raised prices in japan because of inflationary pressures and labor costs. what are you seeing in that area of the world and how does that pose any sort of a drag on the quarter? >> for mcdonald's itself because of their ownership structure, they've got less operating exposure in asia than, say, some of the other brands we follow. for example, starbucks but picking price, considering it's mostly a franchise business model, is actually a good thing for mcdonald's profit, supg you don't see a significant slip in traffic or demand in a market where they're taking price but, you know, asia, including china, still recovering from a lot of the covid challenges. china itself still in the process of reopening or still

has the zero covid policy going on, which is likely impacting demand into the third quarter. until that gets resolved, we won't get a better idea as to what normalized demand will look like going forward across the rest of asia, we're hearing mixed bag in terms of performance due to covid-related restrictions across many different markets. >> last question 90-day trading call takes you through the end of the year. does that mean next year looks a lot better for mcdonald's? >> well, no. i mean, investors typically discount 12, 24 months out what we're trying to do is point out the fact that next year's numbers still need to move a little lower, at least from from a street standpoint. investors need to digest what's going to happen with demand. once they do, investors get more comfortable with it in the multiple rerates first number comes down and multiple moves lower, i think that's when people come back to this from a defensive standpoint and start looking at the stock again. but right now t just looks like with earnings risk and the stock

near multiyear highs from an absolute and relative basis on valuation, it's hard to see a lot more upside in the near term >> all right john, thanks for your thoughts appreciate it. john tower, citi on mcdonald's. we have a few minutes left in the session here. barbara, i think this call on mcdonald's encapsulates the questions a lot of investors have, krs crosscurrents, and how that will feed into the third quarter and outlook for the fourth. >> currency impact is not taken all that seriously in terms of revaluing the stock. it's typically looked at at one quarter or two quarter effect. this time it looks bigger and we've had a big increase in the dollar in a very short time. i think the mcdonald's call is a good short-term call because 40% of their sales, you know, are in europe 41% are here you know they have a lot of

initiatives here it will send the stock down a little bit i would argue that the stock is already down 10% since mid-august i think it's -- if you only -- you certainly don't sell it here this is a great long-term core holding. this is the kind of stock, as it weakens, you can buy into this and i think you're going to see this happen. as third quarter earnings start in mid-october, i think you'll see exactly this kind of reaction to the downside, buy into that most likely. >> and, barbara, as you look into the market, we're in sixth straight session of losses here. what's on your shopping list if we go down tomorrow again, what's top on that list? >> well, we could go down tomorrow sentiment's terrible as we know, this could actually be the start or in the midst of the capitulation phase everybody has been waiting for all year. i think you look at, again, some of the big cap tech names. microsoft, meta, amazon, alphabet you can look at starbucks, which we talked about last week.

starbucks has great pricing power. they have a new ceo, all these initiatives. i'd look at that one united healthcare has been weak. they have a super business that shoulddo well through thick an thin then the stalwarts like a costco or walmart they're not cheap but these are names that will continue to outperform and should help you weather the uncertainty. we are going to have continued volatility in this market because we're not going to know for a while, you know, how much it comes down and when the fed is likely going to be able to ease >> do you think we're close to the bottom do you think we're close to that washout point? quickly, barb. >> it sure looks like it that doesn't mean it can't go lower again because sentiment is terrible it's not based on fundamentals it's based on the unknowable >> barb, great to get your take. we have 30 seconds left until the bell rings on wall street. watching the s&p 500 closely

3645 is your level here. we have notable moves. semiconductors have a nice day today. up by 1% we're also seeing some green arrows in sectors like tech, consumer discretionary, materials and energy up by more than 1%. that does it for us on "closing bell." i'll see you on "fast money" at 5:00 now let's send it to scott wapner in "overtime. welcome, everybody, to "overtime. i'm scott wapner you just heard the bell. we're just getting started from post 9 at the new york stock exchange let's get to our talk of the tape yields around the world rise and stocks fall from the uk to the u.s., uncertainty is mounting as investors grow more nervous about inflation and the ability to fight it. the only thing hanging in the balance now, of course, is your money. markets finding some sort of stability in the days ahead. can they do that let's ask greg