year micron ceo told the "new york times" that the decision was made because, in part, the $52 mil billion in grants passed in august and favorable tax treatment and partnership with new york's state government. >> not pottery >> can you see that like in "ghost." >> make sure you join us tomorrow "squawk on the street" is next good tuesday morning welcome to "squawk on the street". i'm carl quintanilla we get this dovish surprise hiking rates less than expected, raising the received likelihood of rate hikes. a road map begins with wall street's rally mode. investors await new commentary from the fed three speakers will cross the

tape this hour >> plus, oil prices are rising on top that opec may agree to the biggest output since covid kit. and watching credit suisse shares recovering so far in trading today after hitting an all-time low yesterday skill a lot of market skittishness about the future. let's begin with the markets to extend yesterday's rally, jim. i wonder if you think the rba is material here. >> i think it is material, yes, that any good news is met with the belief that it's funny you have a piece by dave collison katie, you bring out chart work. at the end of the tunnel may be earnings recession train a lot of people seem to think, david, did anyone think that this light at the end of tunnel might be an oncoming train

did they think that was new? >> i know that is disturbing you how often that is used >> they must use the same writer allen brady or something >> how about a canary in a coal mine >> time will tell. jury is still out. >> the newer is still out. runaway grand jury >> also i like when it comes to the market action, just positioning. >> oh, don't you love that >> yeah, just positioning. i think we could end the show now. it's positioning >> yesterday i didn't get to say it, there are more buyers than sellers. >> okay. enough that with he got that out of the way, you have the vick's below 30 in more than a week >> i felt yesterday was the most disbelief -- disbelief -- rally in the history of -- i don't know everyone i talked to said, look,

it's this one off, it's over the experience is if it does not collapse by 11:00, this is a brand-new recipe for a rally so, david, i look at things and say no, no -- here's a piece from bank of america ugly third quarter >> what has changed? >> are we in the third quarter >> we're in the fourth quarter >> what is an ugly third quarter? >> yeah. >> what has changed? >> what has changed? there's a belief from the two-year that we are about to have some soft numbers let's say we get a soft number of any sort on the employment number people will say why did i not buy? it is close to going under 4 >> under 4%. we pointed out many times of late that it is the key you want to watch for this market you and i like to talk about the

key. >> like amazon by the way, in terms of the hill layerity hilarity, they are saying you are getting retail for free >> i'm not sure retail makes a lot of money, so it might be a good thing >> i almost feel like i have to stand up. >> so stand up >> all right poshmark got a bid there is a deal for posh >> spice is going to get a deal next no that's unfair. >> it's a billion dollar deal, right? >> the company is a real company. but it was part of the dumb class. i was in the dumb class until 5th grade. no, actually, in fifth grade i was in the dumb class >> what do we call it on the calendar >> 2021. >> posh is a company that is part of that whole apparel

business but it's also home decor, beauty and a money loser. for money loser to get a bid makes me say uh-oh we may be at that moment at last where the companies are so low, david, they are getting bids >> well, there's that. as we said, the trajectory of rates and other central banks. dalio finally saying when facts change, i change my mind cash is no longer trash. >> i saw that and i said oh, my -- he is going with gains we are beginning to see some people saying enough is enough and i think since november it's been pretty grim powell might be winning. >> powell what might be winning >> never mind. >> but the analyst, just do not

believe it this is all just tom foolery you're going to get crushed, david, if you come in here >> tell me what the numbers look like for next year that's really all i want >> you're buying 15 times. everyone says that's a bargain if the earnings are much too high, you are probably paying 18 times. >> and that's too high >> that's too high now we have more on the down side if earnings are going to be down next year, the market obviously you can't have a down year and expect the market not to be down from here but the other thing that's happening is that we all thought oil was going to collapse. oil stable sizings somehow sit being viewed as positive we all decide apple is no good jpm jpmorgan, bank of america, they all hate it.

how about the app to or commentary we get negative app store commentary from bank of america. and the stock is finally on fire oh, and then here. the jonas brothers throws in the towel in september september '01 sales, residual down, rates up >> his larger point is i told you not to buy a car, to wait and your patience is finally paying off now that inventory is at a 17-month-high >> i had mercedes on yesterday the electric lineup is much faster charging stations are all over the place. how many >> carl gave me a number yesterday that said there are more in manhattan there's only seven gas stations in all of manhattan.

>> i guess the question is, are you going to chase it, jim >> we are all in for the trust. >> you're all in >> i need the market to go higher >> when did you buy? >> all last week the market was so oversold >> perhaps you're not alone. >> see, we're right you didn't say -- >> well, you were right so far it's only tuesday morning at 9:08 >> tuesday morning's stock. >> they are on pace for 60% increase. >> fourth quarter is doing -- look, you need one part of that number on friday to be soft. the pmi was soft yesterday

starting to see central blanks kind of blinking >> people will start to lose their jobs and savings will go down. >> have you spoken to anyone who has a 401(k) >> yes >>st we're back to that, i didn't look. i was in philadelphia. i said, man, how is the stock portfolio look i stopped looking at that a long time ago it's one of the stages of grief. >> and costin had 100 billion being taken out by people. how do you come up with that figure some. >> i don't know the mysterious ways >> 100 billion out of households for the whole year isn't that huge a deal.

>> no. there are baby boomers who may be nuts to keep the money in but i just feel like there are signs, there are signs that this rally has until friday >> until friday? what does vladimir putin have to say about that >> i don't know. sending trains of nuclear weapons >> because that is sort of -- it's not even an outlier anymore. it comes up in every conversation, which is frightening in and of itself >> i was with people last night trying to figure out how far a dirty bomb does go and i said, well, i think the idea that we're discussing this is not great although they had the big readings in chernobyl. >> he obviously was talking about a tactical nuclear weapon not just a dirty bomb. >> he has 2,000 of them.

they turned out -- i know there is a lot of people in russia and it's the same size as texas. they turned out to have a corner on fertilizer, on natural gas. >> the economy is the same size as texas >> yes on natural gas, on oil, they have nuclear weapons and everyone is -- all the countries, europe, trying to figure out whether -- there's a lot of talk. by the way, musk has joined the talks that ukraine should capitulate >> got reamed for it by zelenskyy and the "post" >> my experience has been those who have success seem to think their expertise then extends to subjects throughout humankind.

i would without a doubt defer to elon musk on so many things, space, electric cars, solar. but stkes anything about -- >> his coin for wanting ukraine to capitulate not popular anywhere other than the kremlin. >> when he owns twitter, what are we going to do is he going -- >> he's going to have his own -- >> mandatory feed. you have to follow me. twitter musk >> would it bring trump back >> still to come, jeff shell is here, discussing streaming, theme parks and a lot more got calls on media names like paramount, berkshire

another busy day for autos

let's get ford sales >> we have ford down 8.9%, a little bit better than the expectation from edmunds.com, a decline of 12.8% really what you are seeing is the story that we have seen from a number of other automakers they have been able to gradually increase their production in the third quarter. and that's why the sales are coming in just a little bit better than expected but make no mistake, ford, along with other automakers, they remain constricted because of the supply chain they issued guidance that the q3 revenue would be light of expectations because they have 40 to 45,000 vehicles that are built but not fully finished therefore they cannot give them to the dealers who will sell them to customers. so, as a result, what you are seeing here is an improvement certainly compared to september of -- or compared to earlier

this year in terms of sales. but you are seeing an industry certainly not back to where it was prepandemic levels >> phil, talk to us about inventory. we talked about the prospect of lower prices there is at least new day supply as they say, right >> right you're up to 30 to 32 days supply for the dealers at the worst of the pandemic it was down somewhere in the 22 to 24 days supply that's just ridiculous being down there that's why they are out with this note saying, look, we are starting to see an increase in the number of new day supply at dealerships. however, keep in mind 30 to 32 day supply is nowhere near normal for the auto industry, which is 60 to 75 day supply it is gradually increasing but a long ways from what we would

call normal. and the contention of adam jonas, you add in higher interest rates, you add in this inventory that is starting to build. we will start to see prices come down we are not seeing it a lot yet we might see it on the lower end of the youth market. guys, i talked with a dealer just a couple of days ago, and he's getting strong pricing. he is not seeing diminished pricing. so it is still out there in terms of near record-high prices in terms of new vehicles that's what we saw in september. the ample transaction price, or the average amount financed 41,000 compared to 38,000 a year ago >> yeah i know the bronco, f-150, because of the name plate issue. they have sold those it's just the shortage

i spoke with the people from mercedes-benz. they are pushing into the ev do you think ford will be able to mercedes wants to own it >> everybody wants to own it >> that's true >> i give mercedes credit, this is where you have to be. whether it's the whole lineup that is coming, look, those are impressive vehicles. jim, did you see the price tag on the eqs guess where it's starting at right now. >> not more than 90. >> you know where it is. 104,000. 104,000. >> i'll take a gander at that one. >> i know people will sit there and say, well, it's early. it's the first edition models. pricing will come down over time sure, pricing will come down over time.

meantime, you know who has the hammer when it comes to supply chain, when it comes to manufacturing, when it comes to name recognition, you know who it is. it's elon musk and he's putting the hammer down >> elon putin musk you know what the great estebar be greatest bar was a long line but a car that turns heads. ford is -- has a lineup that turns heads. you've got to give them that, phil >> and they're new, jim. when you have the new cadence of new vehicles, that's when you can really make headway. that's what jim and his team are doing right now. you would rather be -- some of this comes into where you come into your administration as a ceo. some of this is because they're coming in right as they have these new wave of vehicles coming out carl, they will benefit from that no doubt.

>> phil, we'll check in with you in a bit important numbers. we'll talk about cathie wood buying some tesla yesterday >> fascinating. >> countdown to the opening bell with he get tuesday under way. so, you're 45. that's the perfect age to see some old friends, explore new worlds, and to start screening for colon cancer. yep. with colon cancer rising in adults under 50,

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as we said, bulls will try to make day two of gains futures are pretty good. yields with some relief. the two-year got basically to 403 or so. opening bell a few moments away. catch us any time, anywhere.

listen a flondolw "squawk on the street" opening bell podcast

let's get to mad dash. a little more than three minutes before we get to trading here. >> i need your help. >> i'm here for you. there was a piece by moffitt davidson called networks curb your enthusiasm. people are excited about the advertising here netflix outperformed since the early spring >> it has. it's actually -- during the third quarter, it was one of the best performers. >> so my question is, david, how many people are really going to want the commercial tier if it's great, it could reflect positively on disney >> yes >> and you have a very important interview coming up. >> that's actually something we will talk to jeff shell about. peacock was the first to offer,

ri from its outset, the offering. jim, what i have heard and i'm shermichael nathanson has heard it too because he speaks to a lot of investors, a lot of potential response to the idea that an ad supported video on demand or streaming at netflix will be well received. >> i know. >> they've got good people in there. i don't know what he's saying, but maybe they will launch sooner than anticipated. and it's going to do very well >> raising 2023 estimates by 10% to 1020. >> what is the curb your enthusiasm then? >> should we be skeptical because there are lines skeptical. that's because so many people thought this is the savior i don't know whether that's the case that is something to ask jeff >> and disney coming with its

ad-supported service in november neutral at worst and potentially aoe across the streetive overall. it is not a bad thing because it equals, if not exceeds the revenue number >> well, disney has been a terrible performer from my travel trust the idea was somehow it would fix the balance sheet during this period. anything that indicates that losses are stabilizing, which would be netflix for advertising. it is really fabulous. i think moffitt is right that the hype is so great but the numbers go up. this is a media company. media company numbers going up [ applause ] >> let's get to the opening bell

in the cnbc realtime exchange. specialty materials company celebrating its 50th anniversary. american electric power doing the honors trying to get above 3700 >> look, we left on friday with a level of despair that made me feel like i just don't know who is still left to sell. of course i was watching the semiconductors, which were incredibly bad performers. we have had back-to-back days of nvidia doing well. advanced micro down from 170 qualcomm is 160, 170 so people are starting -- this is a group so despised

i guess there is a short clearing i don't know >> you don't know? >> no. the numbers are still too high gaming just failed to come back. that's why the app store is not doing well gaming, david, turned out to be peloton. >> we've flushed it out before we talked about 2018 it was weak for a quarter or two. then growth resumed. >> wellive to tell you that i think that advanced micro, the crushing of that stock is overdone >> nvida, amd down roughly the same for the year. 56% for nvidia 52% for amd. >> amd's multiple is back to 15. and nvidia, a faster grower,

admittedly, you've got one that's double that it is actually 37. so one is cheaper than the other. the one that's cheapest, there's been no sign of any deterioration by advanced micro. i wonder what you think of a chance that there could be a come back for intel. >> are you asking me that question so i can turn around and ask you that question, jim >> yes, exactly. >> that's what i thought >> it was a rhetorical question. someone this weekend asked me, do you and david get along >> i get that all the time do you really like each other? >> i have seen a lot of an tip think. >> it's love

>> you're ali mcgraw and he's ryan o'neal. >> amazing book, too >> wait. i want to stop for one second on intel. you did answer it in a way did i miss it? was there a moment when amd market cap passed that of intel, or are they neck to neck same as i did with verizon, t-mobile i mean, the idea that intel would have a smaller market value, or doesn't right now. it's $2 billion ahead. amd when -- >> they're around the same size. >> remember when sanders ran amd. >> yes we felt intel would keep them alive >> speaking of chips, this story in the syracuse paper that micron will pledge $100 billion to build a mega complex of

computer chip plants in syracuse's suburbs this would be the largest private investment in the state. >> try to get a lot of industrial upstate i would say sanjay roach played his hand closely he was here last week giving a forecast that was highly negative and the stock is doing why the well since the forecast. >> it's true we did wonder was it sold out? did it bottom in a sense because this was expected, or worse, might have been anticipated. there was nothing particular positive about that forecast >> wouldn't it be amazing if you had arizona, texas, ohio, new york, all competing for this reshoring or at least increase in capacity?

>> our system is weak. educational system is weak do we have enough people to build these? do we have enough people if honeywell can't find -- >> that's a really good question we should ask one of your guests in the future about that new york state has a number of universities, obviously, that produce a lot of scientists up there in upstate got rpi, not to mention obviously cornell, syracuse itself, rochester. >> the president just put out a statement as well. >> on micron >> never bet against the american people. today is another win for america. another massive new investment >> how many years is that stretching >> it's 20 billion this decade 100 over 20 years. >> look,micron is the one. let's give them credit they have been here the whole t time they are america's semi company. >> don't they have an effort under way as well? >> in ohio >> spending enormous investments

spread over a long period of time and spurred by the chip sacked that was signed -- >> commerce secretary has reached out to both sides of the aisle. they have done a lot of building i do think the big question will be do we have the people we are short staffed everywhere. we're deadly short staffed when it comes to this kind of thing it's worrisome we don't have the education. i love the fact that you are right about universities but we have not been a place where we have used a lot of engineers. that's one of the reasons taiwan semi was able to >> that's right. and samsung matching them down to 2 nanometer technology. the key misstep there was just missing a transition >> yeah. you know what we are good at bow lara opco a piece about bowling alleys the number two player in bowling. how did we go from chips to

bowling? >> i'm saying this is what we're really good at we're good at entertainment. we're back to that again we're back to soft drinks and entertainment. remember, when we had that manufacturing renescence >> evidence lab. it's about time. because this has been in freefall wow, look at that. they are recovering like mad just mad there is a lot of positive commentary >> nothing like a rally like yesterday to bring out the positive catalyst watch city on jpm. >> did you read that i've been speaking to a lot of banks. they tell me stay tuned. you might be surprised >> in a good way

>> in a good way >> stay tuned. that amazon piece you referenced earlier seems to be having a positive impact. >> that was a great piece. the issue was -- >> in her performing a with their peer cap. >> people have hated amazon. they have just hated amazon. david, did you see that bed bath creditors are organizing >> i did see that. >> lithium you know who hates the high price of lithium >> pune -- i mean musk >> we're going to leave you out there with that one. >> i don't mind. >> did you see disney cutting numbers but loving it.

>> downgrade of comcast part of that as well they are talking about the decline of the linear cable ecosystem. although shares of your parent company are up had a nice day yesterday as you see, of course, a very, very difficult year. guys, i want to come to a special situation, small company but one that -- >> us? us >> no. sculptor capital management. >> danny >> i can't get anything by you >> i worked with danny >> i know you did, 100 years ago. danny is not happy he sued ceo after he paid himself 145 million bucks in 2021 they sued him on escalating compensation awards. they wanted emails, text messages so that continues. but why we are talking about this now is because of a 13d

he still owns 12.3%, dan och in a filing, in an accompanying letter as well, he basically says, hey, we've been contacted by third parties that want to buy this company i, as well as other founding partners, have been contacted by several third parties who asked whether we might be open to a strategic transaction. this is a soap opera, again, a small relatively small company people may remember when it went public originally. the first of many of these asset managers to try to go public and then he goes on from there as well to talk about his fear that the board's prior actions and omissions have facilitated the entrenchment of the existing management team despite his poor performance. and the company cannot afford to put the interest of management above those of stockholders.

so wanted to note that it's a nasty fight it's getting a bit nastier but the stock is up on this idea that, hey, he says there are third parties that want to own the company. >> battle of rich people. >> yes battle of wealthy people its returns for decades was pedestrian that was the busy model, never lose money bring it in and don't lose it. don't lose money on it have gains >> dan och has been tremendously charitable always have to bring it up why not? >> jim, one thing that caught our eye was this piece on berkshire's greg able, likely successor to buffett it appears to be his first purchase since he assumed the

position >> they are fantastic businesses the insurance business is fantastic. i think greenberg would tell you that right now with rates where they are so the past is berkshire is all great. and no one is talking about it i think it's quite wrong it is the right stock for this moment they have a fantastic pipeline business i think pipelines should be valued at a premium yet they are valued at a discount if you have one, you will be able to raise prices so i like raised prices on insurance, you raise prices on -- not rails but raise prices on any gas transport or oil transport. guys, since we spent a lot of time yesterday, shares of credit suisse are having a good day. assuring customers, employees, counterparties and anybody else who wants to listen that it

doesn't need to raise capital, that its liquidity is strong you typically want third parties to do that >> let's be honest you keep your ubs? >> i don't hear ubs. >> the lehman moment are already in place to bail it out. one way to do that would be obviously to say, all right, they can force a merger, yes that doesn't mean that's happening. we're still waiting for the 27 but there continues to be this belief that ultimately they will need to somehow raise equity for a split, for funding businesses that are obviously kind of -- or for providing capital cushion for unoff, revenues are declining rapidly on we'll see. but it is notable that the stock has rebounded quite a bit from that all-time low that it did hit yesterday >> all right. i have to tell you that that

fearmongering yesterday butality of the way you can manipulate stocks on twitter. it was tremendous. >> can be. >> you get everybody worried on false swaps. hey, look what is happening. you can move the market easily and the stock follows through. you're right there are a lot of games that you can play here. you hope that would not be the case but, again, for those uninitiated, let's call it insurance on their death it costs more. >> i want to give you a traditional couple of calls. gochman comes out saying you should own starbucks we have been buying it since we went out and visited them. starbucks had annual forecasts i don't know it's just my own work. i think starbucks is the one

company that has not been hurt by china their china numbers are better than everyone else's certainly better than nike last week so i like this call. i like the deutsche bank call. but they're saying mcdonald's is weaker mcdonald's has been a trusted name during the slowdown but this is the second call in the last week that mcdonald's is going to miss numbers. i think starbucks is the safer bet here i think that howard schultz, in a very short period of time, made a technological improvement. cold brew, 75% they can make it faster than anyone now they were so slow through cold brew that one of us actually mentioned we liked dunkin' donuts cold brew, and i think howard took it personally. kicked out of the roastery voted off the island >> well, guys, 3760 a 10-day

high only three names are red good morning, carl another risk on rally. what does that mean? several sectors i watch every day. if they are outperforming, it's risk on. metals and mining, they're leading. they are outperforming number two, semiconductor stocks they also have leading and outperforming. number three are the transports. there's three risk-on groups when they are outperforming, it is definitely a risk-on day. energy is doing well because we have west texas intermediate knocking on the door, $86. look at some of these metal stocks freeport is the leader you always want to watch that. century aluminum, cleveland-cliffs, alcoa. that is continuing today same with the transports fedex has stopped going down fedex is up 5% this week and the airlines, you know how

terrible, they were all at new lows a couple of days ago, they have been balancing. and the railroads, also at new lows, they are also bouncing so it's a risk-on rally. there is a chorus of international agencies coming out in the last few weeks complaining about central bank raising rates. unctb said central banks were too focused on dampening inflationary procedures. a real danger that the policy remedy could prove this agency works on behalf of developing countries around the world. what got everybody's attention overnight was the reserve bank of australia phillip lowe, governor there, had this comment they raised 25 basis points, not 50 so they're at 2.6% but he said the cash rate has been increased substantially in a short period of time reflecting this, the board

decided to increase 25 points as it assesses the outlook for inflation and economic group in australia. that is a central bank pause the bulls are screaming. here you go. here's the first to actually have a pause it's not a pivot but it's a pause. does this translate from australia to the united states we don't know, obviously but take a look at the s&p 500 the real rally started at 10:00 a.m. that's when we got ism prices paid lower. new orders weaker. this is kind of what the federal reserve wants, radio it? we did see a move up starting at 10:00 a.m. i think that's when the real rally starts we're 125 points higher in the s&p 500 since the ism report came out all right. does the reserve bank of australia make a difference? maybe a little economic news has been trending our way a little bit carl, we seem to be in the midst of a tradeable rally we certainly have a tradeable

rally. back to you. we see bonds, the cow up 600 points two-year, back to 409. just below 4.1 plenty of fed speak today as well low gans, jefferson daly dollar tree and dollar general back in a moment

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rets get to jim. >> you referenced the heat map, procter & gamble, has been longstanding, 2.28% yield but it has things going for it for this particular market. the two-year going down in a yield versus the 2.82%

the number of pieces today how the plastic complex is coming down they use a huge amount of plastic. they use a huge amount of paper for wrapping, paper is coming down most importantly, the dollar has now had -- actually had five straight negative days the dollar's really, really hurt them so, if you want a blue chip to buy that is down substantially, 165 to 129, you should consider procter & gamble >> all right, jim. how about tonight? >> we have sunto ary and vlad coric celebrating biohaven, chief spokesman for american migration foundation, and his drug is completed by pfizer and i think will be back for billions of dollars because that man has spent a lot of time

helping someone with migraine. happy to use that when i have one. >> jim, we'll see you tonight. >> i can't wait to see jeff shell on -- with david. >> yes, very soon. >> i see him warming up in the bullpen. i'll tell you, dodgers looking good has anyone won more games? >> no. >> they're up 127 games. somebody over .500 craziness. >> baseball thanks you, jim. >> we'll see you later, jim. dow up 632 we'll stay on top of this morning's rally, jim's right, dollar below 111 s&p has added almost 200 points in two days. wim® by td ameritrae is more than a trading platform. it's an entire trading experience. with innovation that lets you customize interfaces, charts and orders to your style of trading.

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good tuesday morning welcome to another hour of "squawk on the street. i'm carl quintanilla with morgan bren enand david faber more outsized gains, s&p adding almost 100 points as we get a dovish surprise out of australia central bank but more data crossing the tape, including

jolts. let's get to rick santelli. >> yes, let's start with joltz this is an august number, always two months in arrears. consider every month this year has been over a million until now. 10,053,000 first time since september we are under 11 million a still very solid number. it does underscore a slight deterioration in what has been and what continues to be a very good jobs market slightly over 10 million openings we know there's 6 million people out there that may be looking, we could see the inhinequitable. august factory orders, the first negative number since september of last year if you strip out transportation,

it increased up 0.2. that, of course, is your august. now let's go to durable goods. durable goods are august final reads. durable goods orders expected to tb down 0.2% delivered exactly that, which matches the mid-month read prior to that, we were down 0.10%, so back-to-back negatives. strip out transportation, and like factory orders t improves, up 0.3%. up 1.4 on capital good orders, a proxy for business and capital spending, 1.4, solid numbers this series has been rather impressive, as of late, and that is depicting potentially good things down the road finally, when you switch gears from orders to shipments, we're up 0.4%, follows up 0.3% durable goods orders, no improvement on the headline versus mid-month, but all the

other metrics are a bit better factory orders improve we see yields are back to lower than yesterday's close on all maturities, twos through 30s we did see some yield bounces as equities started to pick up strength and the mid and longer maturities actually traded in negative territory, meaning higher yields than yesterday, albeit, very briefly morgan, back to you. >> rick santelli, thank you. we are 30 minutes into the trading session. here are three big movers. credit suisse, shares recovering after sinking yesterday to an all-time low the bank is embarking on a massive strategic review under a new ceo following a string of scandals and missteps. shares are down more than 50% on the year you can see there, up almost 8% this morning rivian also rallying the ev maker saying their production increased 60% from q2 those shares are up 6.5% we'll end with another big mover to the upside.

poshmark, the online retail site is being bought by south korean giant neighbor for roughly $1.2 billion in an all-cash deal. that's roughly half its ipo price. shares up 13% right now. carl >> as we head into what's shaping to be a second day of gains, our next guest is keeping an eye on inventory metric as a key indicator for q4 joining us, adam parker is with us great to have you. >> thanks for having me. >> pretty hard bounce. 6% in a couple of days does it last >> well, we did some work. we've only had six -- we had a bad six months, down 15% or more in q2, another five in q3. we look at 100 years of s&p performance, that's only happened five times. you can get a relief rallying, positioning, sentiment rally when you analyze the quarters after that, it's mixed to not great.

q4 '08, it wasn't great. i think everyone knows the estimates are too high for the consensus, but you point out, i think, what's going to be a key performance indicator, if you look at what happened last week, nike, micron, you started to see some inventory builds. i think that could be the key thing to follow in october earnings because as we know, it was hard to get supply everyone ramped up production. now we might be at the point production is exceeding consumption and that could be a problem for margins. we're laser focused on that for the companies reporting next week. >> beyond apparel, right >> yes. >> what else >> industrials, machinery, semiconductors obviously a key area, because you're so -- you know what happens. if you can't sell something because your suppliers aren't there for you, you start ordering like crazy. make sure 12 months from now, 18 months from now, i have the parts i need now as we get production catching up to consumption, we're going to start building inventory. that's bad for margins and probably bad for the stock market, you know, six, nine months >> you see an inventory buildup.

how long could that stretch out in terms of the earnings picture and what that means for stocks more broadly. >> yeah. it really depends on the perishability of what you overproduce. if you produce and the pricing gets killed, your margins go down a lot micron was 5%. it can be bad for a real commodity product. other businesses maybe won't slash the pricing so it won't be as detrimental the way we're looking at it, gross profitability for the s&p 500 is 300 basis points too high probably continues to come down. that makes the consensus 10% to 15% too optimistic for next year. >> you write the s&p 500 earnings expectations are now 2.7% lower for the full year than they were at the end of june 6.7% lower for the pending third quarter results. is that enough >> you know what it's like, i a lot of times companies guide down and beat it by a little bit.

in aggregate they're still lower than they were three months ago. i'm focused on what they're going to guide as you get numbers and what they're going to think about 2023. there's some numbers you can't forget the average consumer company in the s&p 500, no matter what you're looking at, apparel, retail, restaurant, grows around 6% top line and just grew 15% to 20% the last three months. there's no debate about whether they're overearning. the debate is when will it come down and when will it bottom i've been warming to this idea in the last two or three weeks, the consensus we get a bottom and recovery in 2023 might be wrong. we might have a slower decline from a nominal gdp now and maybe 2024 numbers are below '23 and maybe we're underwriting a recovery that's a little too optimistic. >> that doesn't sound good for the market at all. >> i don't think so. i don't think that will be great. you have to focus on, you know, relative estimate achievability. where the numbers relatively more achievable. i think what's hard for

investors is the place we think they're more achievable, staplesings utilities -- >> health care >> i think health care is probably more achievable and less expensive i actually like health care more than staples and commodities because some staples are so defensive and people have been defensive. you have to find the relative achievability. >> would you be putting money to work in this market? >> we have equal 10% down, 10% upside that's not great risk/reward for the first time in my career, in the last few months it looks pretty good to buy the two-year yield and get the guarantee plus 4% i'm not positive it will be upbeat two years from now. certainly that's more attractive than it's ever been. it's not great for price to earnings ratio for the market. you have to find things that can grow and that the estimates are achievable i think everyone wants the fed to get dovish because they think that price-to-earning ratio will exwanted pand.

you'll be multiplying higher price to earnings against lower earnings and you might not get the price you want. >> i know your old friends at morgan stanley are at 212 for next year. >> we posted a 218 from the top down i think the real debate, though, will be, what do you get after that if i'm right that maybe it's 210, something in 2024, then, you know, to david's question, that might not be great for the market it's not apocalyptic i don't think we have banks collapsing, but what causes troughs every time you know, a collapse every time. huberus and debt fancy new headquarters, spending, you're starting to see excesses from the last 6, 12 months. >> meanwhile, it sounds like active management should be what works, and yet -- i mean, i'm looking at hedge fund numbers that continue to be terrible. >> this is interesting we just did a big note on the quarter. if i told you at the beginning of the quarter we would be down

five, you would not have said hypergrowth will beat growth, growth will beat value fy told you energy was down 25, do you know how many times in the last 40 years the oil prices have has been 25%, the market's been down 5 and energy was up? three or four times. we've seen an unusual microstructure what's happening underneath for a market that's been this bad at the top line. >> which goes back to a point you made where the fed is concerned, that is the irony if you're betting the fed is going to be forced to pivot, it's probably because something's breaking >> yeah. they've caused a deep decline in the economy. i think that's right you're going to be weighing those two notions. and i suspect the math is pretty easy for people to figure out. the cpi will stay high for a long time because rents are a big chunk of it and rents are going up every new home buyer is faced with the wrong quadrant. they need something to collapse before they can come answer. they're going to rent. you have to pressure things up and the fed will react to the elevated cpi maybe inflation has peaked

i don't think that's a debate. it's just how fast will it come down and when will it trough i think it's going to take longer than maybe the consensus. >> rent is troublesome when you see wages on friday that was great, adam >> good to see you guys. have a good week. as we head to a quick break, let's give you a look at our road map for the rest of the hour it includes an interview with our boss, ceo jeff shell we'll take a look at the streaming, the universal parks, and a lot more. the ceo of defense contractor l3harris is joining us after inking a deal with viasat satellite

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no shortage of things to talk. i want to talk films and parks investors really want to talk a lot about peacock and direct-to-consumers. they try to understand the new landscape. there's a downgrade of our new parent company comcast today they start the downgrade by saying the linear business model underpinned media is set to decline rapidly, pivots to direct-to-consumer are dilutive to margins and earnings. give me a response to that thesis >> well, so, i think the -- there's no question that's not new. there's no question the whole television landscape is changing just look at how consumers behave and how they watch tv you have to get deeper into it there's definitely a shift from linear to nonlinear. streaming is really nonlinear, watching stuff when you want to watch it really it all goes back down to content. if you have the right content and offer a broad distribution platform, your consumers will find you that's what we're doing with peacock. >> when it comes to peacock, though, there continue to be questions about how robust the

service needs to be. 13 million paying describers right now. ryan roberts had a conference, 16 million total but obviously a lot of them are comcast subscribers. ebitda loss of $220 million for 2022 what do you say direct-to-consumer is important, the nonlinear business, but how are you going to make it profitable >> let's break it down a little bit. we entered streaming, as you know, about two years ago, two years and change ago when we looked at the market, we looked at the upper end of the market, netflix, you know, disney plus, no ads, premium, and even back then it looked pretty frothy, looked pretty competitive. we decided to enter in a different way. we entered as kind of a broad dual revenue stream model which we thought, a, was the more attractive business opportunity, but it happened to fit really well with our company. that's what we do in our regular business that's what our content is that's where our advertising strength is.

so, we launched with all that. we are doing really, really well in that model. so, as of this quarter, we have 30 million active accounts that are watching us monthly. of those 30 million, we're actually up over 15 million now paid giving you some news this morning. >> okay. that's 2 million more than - >> over 2 million more since the end of last quarter. if you look at since the beginning of the year, it's 70% more than we started the year with we've grown paid up 70%. if you look at kind of what's driving that in the quarter, why are we growing when some parts of the market are flat it's driven by the content for us there are four different pillars of content sports has been really successful for us. we have the best sports offering of any streaming service all of our major sports offers on linear, we have nonlinear rights and ong-term stability. nfl, english premier league, wwe. you've reported we have big ten rights coming next year with a lot of rights on peacock biggest sporting event in the

world is world cup coming in a month, which will be streamed on peacock. second part of it is going to be our studio i think we'll talk about our film business hopefully later. >> of course we will. >> our film business is cranking all those films we spent -- the investment you referenced, most of the investment we're making in peacock is on our own content. a lot of that is film. films are coming directly to peacock after their transactional window minions, jurassic park, black phone, all this quarter drove growth and all those movies stay on the platform and every quarter we add new movies. film, we have the best studio, therefore, the best film product of any streamer. third category is our linear business, even though you mentioned they're declining, they're still very strong and number one across the board. all of our content that's on nbc, bravo, our other channels for the first time in the next couple of weeks is coming to peacock where it used to go to hulu we terminated our hulu

programming agreement. if you want to watch "saturday night live," real housewives, those are all coming to peacock. that just started. and lastly, we're doing originals which we have a prudent strategy. >> why the continued chorus there's just not enough scale on peacock? again, i'm quoting from a bank of america note that came out last week. given small amount of net adds and lack buzz around hit shows, we worry peacock may struggle to hit engagement after ten hours per month, per consumer, and they say cnbc is the greatest risk of the companies to follow. how do you respond to that continued question whether there's simply not enough scale? >> there's an easy way to respond. everybody is talking about subscribers. all subscribers are not created equal. you have to look at the real numbers. once again, in this quarter, we're doing an arpo of close to $10 on paid subs

which is healthy we did over $1 billion in the up front for peacock, linear is second up front since we launched two years ago the third quarter on a run rate basis, our third quarter, we would do $2 billion in annual revenues on peacock. so, i don't know a lot of businesses that you've covered that in two years have reached the point of $2 billion. we're right on the trajectory we wanted to. we're growing subs, we're dw growing our revenue and we have the scale to do what we want. >> are you investing enough? as a company we invest over $20 billion in content but specifically to peacock, i mean, disney plus, chapek said, $16 billion. netflix is at $17 billion. is it enough at peacock? >> going back to the beginning, we are a different strategy than netflix or disney plus we don't say, this is how much we're spending on nbc or peacock. we're building a platform where content creators can have a platform that offers them the best chance of hit as they move

across different devices for consumers to watch and allows advertisers to have the full platform we think our platform is the best we need a streaming part and peacock is perfect we're growing where we need. >> those who would say, you need to figure out a deal whereit's paramount or warner bros. discovery, perhaps some time from now because direct-to-consumer is the key and it's simply not big enough you say? >> first of all, just the scale question i find completely baffling i've been at comcast for 20 years, at nbsz universal for over a decade. there's not been one time i've had an investment we wanted to make we think would drive a return that we couldn't make because we didn't have enough capital. our competitors that you cover can't say that, right? so, what scale i mean, scale -- we have all the scale to do what we need to do we're making huge investments in our theme parks, twice as many movies as our nearest competitor and we're buying all that content and moving it to peacock to establish the streaming

i think we have plenty of scale. sure, if you can make acquisitions for the right strategy and right price, we've been a company that has always made acquisitions as part of our business dreamworks we bought six years ago. people questioned the price of that it's been an unquestionable success, adding another animation studio at a price that looks favorable. i won't talk about the tra transformative deals, but for people that say we need to do something, with he don't need to do anything. >> i want to share a quote, saying the linear model can no longer be saved so there's less and less energy being devoted to saving it. do you agree with that >> i think whenever there's a shift in businesses, people tend to get to the end of the movie without following the movie through. there's no question that linear is starting to decline you see it in your own behavior. linear is still an incredibly important business and important to businesses and advertisers. look at the nfl which we just renewed last year. look at the numbers of the nfl or olympics.

linear is part of the overall ecosystem. >> produces a lot of cash. >> a lot of cash flow and a lot of viewers people don't just go home and say, i want to watch linear or streaming. i want to watch a show sometimes it's a live nfl show, bingeing drama on the streaming service, sometimes watching a chicago episode live because you saw it on peacock last week. it's more complicated than that picture. it's over. >> what about at 10:00 at night, can they still watch nbc programming or going back to the affiliates >> when you look at the investment in peacock, most investment is for our own programming putting it on peacock. if we're being prudent operators, which we try to be, if you're allocating a bunch of resources to one part of the business you have to look at allocation of resources to another. i don't think we're ready to make a decision on 10:00. >> when are you? do you know when you come to a decision given it's -- >> whenever the numbers work right now we have a lot of great shows at 10:00 we make a lot of money at so:00. we still have a lot of viewers

at so:00 there's no question throughout the day as linear declines, you have to make some tradeoffs. we'll be looking at that as our investors want us to look. >> we've mentioned parks a couple of times but haven't focused on it. one of the important growth components of the company. perhaps not thought that way when the deal was done it's a star. can you continue to make the kind of investment that will generate the returns you want? >> the parks business right now is just cranking if you look at our domestic theme parks are way above where they were in 2019. approaching historic levels. we're taking share in florida. that's all with international visitors way down from where they were prior. we have runway for international visitors when they come back internationally, this is going to be the first quarter, the third quarter we're actually profitable in beijing. even with lockdowns, with travel restrictions, that park is slowly, steadily climbing. >> i would assume it's slow -- >> sure. you can't travel from outside beijing into beijing given all that, we're generating

enough visitors to be profitable that's promising for the future. and what's really promising is the end of the third quarter was really strong in japan, osaka, one of our biggest parks the most promising thing to me is it's being driven by the investment we made during the pandemic on a new nintendo land, which is fortunate because we also invested in building that in hollywood, which is coming in the beginning of next year coinciding with the launch of our mario movie at universal and building epic in orlando, our third park, anchored by nintendo the theme park business we continue to invest during the pandemic and all that investment is paying off. the growth in the theme park business is dependent on how much capital we want to allocate to the business but it's a great business. >> great business. >> great business. >> the film business, how would you characterize that, is that still a great business you mentioned earlier, in terms it of delivering things directly to the peacock platform or continuing to first have them on amazon and netflix and then ultimately on peacock? >> two things happened to the film business during the pandemic the first thing that happened is

windows finally collapsed. the windowing scheme on films is much different than it was going into the pandemic where you have a shorter theatrical than we do with something called the pevod window which is transactional. that construct, you know, of the windowing combined with the fact of streamers really want movies. movies are driving platforms has, in my opinion, made the movie business economically stronger than the entire time i've been in the movie business. we have reacted to that by putting more capital into the movie business during the pap while everybody else was scaling back -- by the way, we have scale at our company to take a movie like minions and not release it right away, sell it to a streamer while the business recovers. we're making more movies because we believe in the business and also attracting the best film makers because of the model. we have the best distribution scheme we have the best marketing - >> you don't think you need to send things directly to the

peacock platform to, perhaps, make that more robust? >> in the third quarter where we've grown pretty robustly at peacock, we had jurassic world, minions and black phone, three good theatrical movies that all drove peacock subscribers. all those stay on the platform in the fourth quarter and then nope, the jordan peele movie that had a great summer, and doing a day and date with halloween and tracking well. i think it really depends on the movie. for me, most movies are -- feel like movies when they get a big, robust theatrical launch and end up at peacock a short time afterwards that's what makes a movie as opposed to a long tv show. occasionally there's a movie like "halloween" you can be strategic about and put it on peacock at the same time i think the movie business is great. i think our movie business in particular is very strong looking out at our slate and i think because we bought our rights, that's going to contribute to the growth of peacock going forward. >> you mentionedpulling some

content off hulu i wanted to get a sense from you, would we want to own all of hulu if we could actually work that deal the other way? we own 33% now we being comcast or is that something that in 2024 you're going to say good-bye to? >> well, you know the deal, the mechanism is there's a buy/sell at the end of next year. our anticipation is going to be that disney is going to pay a lot of money - >> certainly sounded like that having spoken to chapek a few weeks ago. >> which i watched it sounds like they're going to buy it as brian said a couple of weeks ago, it's a great asset. if it was put on the auction block, it would fetch a high price. it would be a pretty robust auction. we would want to participate in the auction. we like a lot of others would want to own hulu we don't anticipate that happening but it would be a great asset. thanks for taking the time, david. >> pleasure to have you, jeff shell, ceo of nbc universal. carl, over to you. >> david, fantastic. thanks. coming up, we'll go live to vienna ahead of tomorrow's big

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cathie wood's flagship ark fund moving higher today still down nearly 60% for the year the etf buying more top holding tesla in yesterday's trade after that stock sold off on record delivery numbers that, nonetheless, did disappoint. the ark fund picked up more than 100,000 shares of tesla. tech up next, we'll talk to cathie wood in an exclusive interview at the top of the hour we'll talk about some of her recent purchases, the prospect of deflation, innovation and so forth. >> that will be must watch tv. as we head to break, take a look at the s&p gainers. the s&p up about 100 points at 3776 every sector right now is in the

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welcome back to "squawk on the street." we're one hour into the trading session. all the major averages are higher let's get over to bob pisani for a check. >> we are having quite a powerful rally only three stocks down in the s&p 500. that is quite a move to the upside what's moving things i want to show you the s&p 500 for the last two days because we really started rallying when the ism report came out. that was at 10:00 yesterday. the key here is we see prices paid lower, we saw new orders a little bit weaker, and that rally has continued into today we got the jolts report out a half an hour ago it showed definitely weaker series of job openings that are

out there. again, this all supports the fed's thesis of slowing down the labor market a little bit. so, we're 160 points higher, guys, than we were at 10:00 a.m. yesterday. that's a very, very powerful rally and a risk-on rally. that means semiconductors, metals, transports, these are cyclical groups that do well when things are looking a little better take a look at semiconductors, for example, amd nice moves up here up about 8% or 9% the last two days micron, nvidia, broadcom and metals and mines had been deteriorating throughout the month. nice big rallies as well all the airlines, 52-week lows last week. the railroads were hitting 52-week lows all these stocks have bounced. even fedex has bounced it's up about 5% in the last two days those are pretty good signs overall. timely, the vix, we didn't get really into the panicky territory. in my mind, that's over 35

we got to 34 and change in the middle of last week. let's call it close enough for the moment vix now back below 30. carl, back to you. >> bob,thanks for that oil prices is a big part of the puzzle on expectations that opec plus may agree to a large cut in output at its meeting tomorrow our brian sullivan is live at the group's headquarters in vienna and joins us this morning. hey, brian >> reporter: hey, carl yeah, listen, we got the place to ourselves today the meeting is tomorrow. opec's headquarters is here. first in-person meeting in 2 1/2 years. we thought it was going to be virtual and over the weekend they said, we're going to do it in person, which has led to expectations that something big is going to happen let's walk through the three things to watch. i got a piece up, by the way, on cnbc pro on just this. number one, are we going to get a cut? if so, for how big and how long? the expectation is a cut between 500,000 barrels, 1.5 million barrels a day. a lot of talk about that million mark even if we get what, probably

won't take 1 million barrels off the market physically but it would be symbolic to support the market two, how will the u.s. react if, indeed, we get that cut tomorrow i can personally tell you from talking to people, the white house is, shall we say, less than pleased with this meeting and expected rate cut. will the u.s. react by pushing through the nopec legislation? will there be calls to stop selling arms to saudi arabia how will we react if there's a cut? going to be a big deal and then there's the russia factor it's opec plus meeting russia is 11 million barrels a day. they are the big plus in opec plus and while i can't say for sure, the expectation is that the russian delegation will be attending in person. alexander novak, former ministry is now deputy prime minister i asked opec a short while ago, are they confirmed they said, we think they're coming we're not sure that would be a really

interesting geopolitical situation given we are in europe, which i've been told by some people that there is an energy crisis right here in europe, carl so, three big things to watch. the opec meeting tomorrow. should get a big production cut. in person for the first time in 2 1/2 years. >> all this back and forth, brian, about the possibility of a price cap on energy. how is that factoring into, i guess, the chess that's being played now with this opec meeting happening? >> reporter: well, said. i think it is a game of chess. i don't know where we are in that game, morgan. certainly there's talk about this price cap there is the december 5th sanctions, which are supposed to kick in, which effectively would ban russian seaborn shipments of crude oil by making it impossible to ensure the ship. a ship of crude oil is about 500 million bucks, roughly you're not going to let that go to sea without insurance the sanctions that are on now haven't really seemed to work. we've seen a huge increase in sales to countries like india.

they're going to try to do the cap, do the banning, by the insurance route. russia is not happy with this. this move, if they do cut, maybe to try to bring prices up in the near term with the expectation that we could see a price drop if we see a global slowdown, whatever may happen, are they trying to firm up the market i think, guys, just again, covering opec for as long as i have, i will editorialize a bit. i think it's more symbol of we're still in charge, who's going to run the global oil markets right now if we do get that cut you saw the tweet from democratic congressman from california, this is your world, defense, and i know you have l3harris coming up where they basically said, if we get the cut, we'll stop selling arms and aircraft parts to saudi arabia so, this sort of relationship deterioration potentially between the saudis and the united states is a huge overarching back drop of what is going to happen inside that

building all day tomorrow. we'll be here to cover it as well in person in vienna. a lot of -- it's a lot more about than just oil. >> yeah. it's certainly high stakes of course, all of this conversation happening, what, a month before midterm elections here domestically as well. brian sullivan, we look forward to your coverage thank you. shares of viasat skyrocketed yesterday on news that the satellite operator is selling military communications unit to l3harris a nearly $2 billion deal, all cash expected to close in the first half of next year. here to discuss the deal and broader gop political landscape we just touched on, in an cnbc exclusive, l3harris' chairman, chris kubasik. great to have you back on the show. >> morgan, great to be back. >> we have a lot to get to i want to get your take on geopolitics, but first the deal itself, it not only sent viasat

shares surging and l3harris' shares as well what does this enable you to do in terms of future pentagon contracts? >> always good to see you. last time we were together, we talked about our trusted disrupter strategy i just rolled out the agile development group. we just announced our strategic partnership with a venture capital firm today we're excited to talk about our first acquisition since the merger of l3harris l3 and harris three years ago. this is a huge win for the war fighter and the employees are excited and the shareholders, obviously, are reacting positively we have both been around a long time it's unusual to see an announcement where both the viasat stock and the l3harris stock moved positively for two consecutive days it's being well received by everybody. at the end of the day, when we listen to our customer, they want to be able to connect the satellites to the airplanes to the ships, to the soldier on the

edge this solution, this technology enables l3harris to do that. >> yeah, the joint demand and control, which is this very ambitious concept the dod is rolling out to enable all of that connectivity, the biden administration has been pretty averse to deal-making across a number of industries, including aerospace and defense. why do you think you can get this deal done >> well, first of all, i think it's been positively received by our customers so far to date and this is actually creating more competition l3harris is a midsize company. i think our ability to make acquisitions is going to allow us to be a solid sixth prime, thereby, competing with the big five primes. great companies but double or sometimes triple the size of us. we've been punching above our weight we've been winning prime programs couldn't be more proud of the workforce. but we need to be able to grow organically and inorganically.

this acquisition creates competition, which is what the department of defense needs. >> certainly l3harris is coming off a busy summer. over $4 billion worth of high-profile pentagon contracts won. can you remain aquisitive after this deal? >> that's our strategy we're constantly looking at opportunities to grow as a partner, venture capital, whatever the case may be but absolutely we'll continue to look for opportunities the immediate focus is obviously to get this deal closed and continue to execute on the strategy that we've laid out >> let's talk a little bit about the world and the geopolitical landscape. i mean, it seems like this year it's become a more dangerous place. you have russia invading ukraine, threatening use of tactical nuclear weapons just two weeks ago. then just yesterday north korea conducting its longest range ballistic missile test to date have we entered a new era of geopolitical uncertainty >> yeah, morgan, i think it's

always been an uncertain and challenging world. it seems over the last year or so it's becoming more visible. i think these threats have always existed they may have not have been understood by the general population unfortunately, we're seeing them in front of us today so, that's all the more reason why this acquisition and the ability to basically have network warfare is so critical i referenced jadc2 how do we connect everything that's the future of warfare we're well positioned to support our customers. not only in the u.s., but nato allies and other allies around the globe. >> markets seem to be largely focused on central bank policies we're certainly seeing that this week with the big bounce in major averages here, but you have this rising rate environment, inflation, supply chain and labor woes, and even oil, which we were just talking about, as some lawmakers here

threaten crackdowns on saudi sales -- or saudi purchases of arms from the u.s. if that opec cut takes place. it all funnels back to national security and to the defense sector how are you navigating that? >> yeah, i've got to say, it's been a challenging year, not only for l3harris but the whole industry there's a lot of uncertainty we spend a lot of time talking about let's control the controllables. there are things we can control and there are things we can't. when we can't, we have to adjust and be agile i think we've been doing a pretty good job of that. you mentioned supply chain, and that is a big challenge for everybody. when we spoke previously, i would tell you we had 20,000 suppliers. that's what we have at the first tier of l3harris over the last year as we go down into the details, today we have 600,000 suppliers to tier two, three, four and further down each one are dealing with challenges, covid shutdown,

attrition, the ability to retain and attract people has put pressure on the system later this week we are hosting the aerospace industry association supply chain executives over 100 companies coming to our rochester, new york, facility for a few days best practices, how do we work together we compete with these companies, but at the end of the day, we'll all interested in national security we're all working together i'm proud to host that event. >> international sales, specifically, to put you on the spot a little bit, saudi arabia, a huge purchaser of arms from the u.s. and has been for a number of years. if that were to change, given what we're seeing play out with opec this week, what would that mean for an l3harris what would that mean for the defense industry where scale is so important >> 20% of our revenue comes from our international customers, our allies obviously, uk, australia, canada, far east, mideast around

the globe. we adjust accordingly. we obviously follow the rules and regulations. as of today, you know, we continue to support our allies a lot of this acquisition, we talk about the network going across services, going across platforms. not only does that apply to the u.s., it applies to our allies coalition warfare. they'll either be part of this process or not we'll have to see how it plays out in the weeks and days ahead. >> chris kubasik, always great to have you on we appreciate your insights. the ceo of l3harris. stock's up another 2% today. >> thank you, morgan as we go to break, it has been a nerve-racking year for investors, as you know, experiencing market volatility, high inflation, rate hikes helping them navigate what may be on the horizon, the advisers on this year's fa100 list revealed earlier this morning. you can tune into "the half" at noon eastern to meet them and check out the full list at

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the street." i'm dominic chu. every s&p 500 is up. consumer discretionary over this shoulder up 4.25% are at least toward session highs at this point. within that group we're seeing gains in travel and leisure stocks like caesar's also the cruise lines and expedia, as well domino's also in positive territory after ubs upgraded that stock to a buy rating the analyst says concerns over demand are on overload and they have above-average resiliency in an environment where consumers are cutting back on their spending picture and watch domino's right now i'm sending it down to you at the stock exchange. >> a big show is coming up on "tech check. don't miss our exclusive with cathie wood. that's coming up at the top of the hour first, throughout hispanic heritage month we are celebrating our teammates and contributes and here's saul

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rights to the board, and he's essentially stepped down from the firm, again, that he once controlled and obviously built into the world's largest hedge fund he had been a co-cio for some period of time he had stepped down as ceo some time back, but at this point now, particularly with the fact that he's transferred all of his voting rights to the board of directors and stepped down as one of his co-chief investment officers, he will continue as a cio mentor you see that right there and obviously -- not obviously, still be on the company's board of directors morgan, those kinds of transitions are very difficult particularly for a private firm, founder-led, oftentimes they go away when the founder goes away. the key is giving the keys to the next generation and they seem to have done that here. >> to your point, this has been a slow and orderly trudge to this moment of transition and also seeing headlines that the

alpha flagship strategy has gained almost 35% so far in 2022 so i'm sure that helps the cause, as well not a bad time to say see you later when you're up that much in a very difficult year >> moving on sales of luxury apartments in manhattan. they fell 18% in the third quarter and that was the biggest drop since 2020. robert frank has more on what has been behind that slowdown and what it could mean for new york's taxes and recovery from, of course, the pandemic. robert >> good morning, david in manhattan and the rest of the country it's the top of the real estate market right now that is seeing the biggest drops and prices are still rising with the average price just under $2 million, but prices, of course, lagged sales and you look ahead and it's the high end that is getting hit the hardest and prices over $4 million fell by 50% and eight-figure apartments that had been selling quickly

now sitting in the market a lot longer and the supply of luxury apartments up 29%. discounts are now the highest for apartments priced at 10 million or more. sales are simply returning to normal levels from pre-pandemic and manhattan is less sensitive to mortgage rates, but falling stocks, weak wall street bonuses and office cutbacks and the impending financial crunch in new york city as the federal aid starts to wind down and same thing nationally sales of luxury homes falling 28% in the quarter and that's the biggest decline since 2012 david? >> robert, thank you robert frank we have the s&p on a tear. all you have to do is change the calendar to the fourth quarter and suddenly it's just positioning as you like to say and nonetheless, a significant rally under way. >> the s&p up % 3% and up 107 a

selling at rosh hashanah and yom kippur which is tomorrow and we'll see how that theory plays out, but many folks saying we're due for a technical bounce here, and it seems to have some legs at least to start the month. that will do it for "squawk on the street." "tech check" starts now. >> good tuesday morning. welcome to "tech check." i'm carl quintanilla the dow making it two days in a row. how should investors think about this bounce and the dean of valuation will join us plus, what can amazon tell us about q4 and the overall market and we'll tell you what they're seeing in terms of cloud, contracts, enterprise for retail and more finally, you won't want to miss our exclusive with ark invest cathie wood buying that tesla after that 8.5% drop yesterday, jon? >> we're talking about thi