> seema mody. and norwegian ceo will be joining jim cramer at 6:00 p.m. you won't want to miss that. and i'll see you at 5:00 p.m. on "fast money" with your countdown to the jobs report and that does it for the exchange "power lunch" starts right now and welcome, everybody, power lunch. here is what is ahead. retail investors are bailing on stocks according to jpmorgan, they haven't sold this much in individual companies since march of 2020. we'll tell you what they are selling, what they are buying and what they are getting rid of and it includes well-known names. plus rolling the dice, corporate america binged on cheap debt

and now a recession may be looming. which companies are most at risk you know who will tackle that, con contessa >> and hello, everybody. stocks moving lower, the dow down 283 at the lows right now sitting down 223 points, 0.75 percentage. and s&p off half a percent, nasdaq roughly flat. the only positive sector right now is energy. the energy etf on pace for its best week since late 2020. marathon, occidental, apa leading the sector higher today. occidental up 4.5% utility stocks are under pressure though, a number of names hitting new 52 week lows, including duke energy, dominion and eversource dominion off by 4% on the day. >> and the volatility in the market centered around what the fed may or may not do in the past hour, fed governor lisa cook said restrictive policy is

necessary. minneapolis fed chief kneel cash carky said until i see [ neal cash carky said until i see evidence that inflation has peaked and head back down, i'm not ready to declare a pause i think that we're quite a ways away from the pause. and atlanta fed president agreed but also gave a nod to the doves about a potential pause. >> ideally i'd like to reach a point where policy is moderately restrictive, somewhere between 4%, 4.5% by the end of this year and then hold at that level and see how the economy and prices react. >> our next guest says he'd prefer the fed to slow down the pace of rate hikes which would lead probably to a big market rally if nothing else. jim tierney from alliance bernstein. do you think this is the way the fed is going to go, jim? i mean, we've heard an awful lot of fed speak over the past ten days or so and it does not seem

as though they are ready to take their foot off the brakes, not one bit. >> i think the fed is going to talk tough until they move and until they moderate their policy that said, what we're seeing, whether it is home prices rolling oversee gwenn shally, whether it is rents finally coming down, whether it is used cars prices coming down, we're seeing a lot of indicators that the economy is starting to slow. and if that does play out the next two months, it lets the fed take their foot off the gas and i think the market would respond favorably to that. >> and so maybe just maybe we're seeing some of the tip tops of those data points and maybe things rolling over just a little bit one of the things that i thought was interesting in my note is that you are going to have your eye on in the fourth quarter the pace of buybacks you think that might be some fuel for the bulls in the market explain why that is an important indicator for you.

>> so with the tax changes that were instituted starting on january 2nd, any stock that company buys back, they will be subject to a 1% tax on that buyback. if i'm the treasurer or the cfo of a company, it would be in my best interests to speed up the buy buyback, get as much done as i could in the fourth quarter, lay down my cash balances and rebuild them naturally so i think that you could get a super charged rally if things start going in the right way where you have companies competing with investors for their underlying shares. >> one thing that is really striking me is that it seems largely to be maybe not irrelevant, but expected on the part of these fed speakers that we are seeing some pain in the markets. it is as though they are saying no pain no gain. you've got neel kashkari saying there will be losses, some failures around the global economy as we transition to a higher rate environment, that is the nature of capitalism here.

so what do you think the markets should prepare for through the end of 2022, jim >> i think the biggest part is the labor market we've already seen the good side turnover we need to see the labor market slow and what i've seen so far this week with whether it is the jolts report or the jobless claims, we're starting to move in the right direction that is the key. that is what we're really looking at and if that starts to moderate, it does allow the fed to ease up here >> yeah, that jolts report where they said a million jobs >> a million fewer >> openings. they are just gone >> poof. let's get to a couple stocks that you like. beginning with cooper companies. not the tire company moving on to automatic data, payroll company, and american tower. why these? what do they have in common even though on the surface not much >> sure, there is a real theme here which is i want to see companies that can put up great earnings growth in 2023.

regardless of the fed scenario, we're going to have a slower economy next year. so though companies that can buck the down trend and earnings pressure and grow right through it i think will be reready with aed rewarded so the contact lens business, most people if you have a slower economic environment are not going to stop wearing their contact lenses likewise with adp, if you are working you are still going to get a paycheck and certainly no one is ready to give up their cellphone, so american tower has persistence to their business that we think is valuable. >> thank you very much, jim tierney, appreciate your time. xwloo and retail investors are dumping stocks at the fastest pace since the start of the pandemic according to jpmorgan, retail traders were sellers of equities for a second straight week exiting $2.4 billion worth of stocks they even sold into monday and tuesday's rallies. and they were ditching names

like apple, alphabet, meta, microsoft and nvidia and they were rotating into etfs, inflows totaling about $1.4 billion here to talk more about the retail investor retags is herb greenberg and our own bob pisani bob, let's start with you. what are you seeing? >> the important thing is we are continuing to zero tags into the etf miss and passive business because the evidence is overwhelming active fund managers don't outperform their benchmark. that is the single most important thing. we have known this for 50 years, but it is only in the last decade that we've had vehicles that make it very easy, etf vehicles, that make it easy for people to invest and we can debate about whether some of these are necessary, i have my own thoughts about them, but overall, this business is meeting a real need.

>> herb, can you give me a sense of what the catalyst has been for the retail investor? they are dumping a lot of names that -- out of companies that they know and like and use their products >> well, i think if you are a trader, not investor, but a trader, in this kind of a crazy market, i guess etfs are the easiest way to go. but the bigger issue, which is something i wrote about the other day, and which bob and i talked about 12 years ago when i was at cnbc, the question of whether what we're really seeing is something that is posing somewhat of a systemic risk to the system now, i raised that question back in the day and i think i was probably wrong but then we only had 1,000 etfs. right now we have almost 9,000 etfs they have $1 trillion in assets and now $10 trillion and you are seeing just this impact of passive investing

where you wonder -- and i obviously deal with individual stocks in my current go-round on the long side. and you see so many companies that aren't part of the passive influx because they don't get some algorithm and some headline that gets them swept up in the trade of the day and that creates great price dislocations and great opportunities. and meanwhile we get back to the issue of etfs. >> what do you think, herb, number one, and number two, when you think of etfs and you describe them as passive, some are and some aren't. >> most still are and the issue of the role of -- the role of passive investing which is what i think you have to focus on here is, you know, when you have that kind of power in the market, what is it really doing. and i would suggest, look, you have different types of evident tfs.

you have the issue with leverage, with single stock etfs that trade derivatives of tesla. you have so many different things going on that you have to raise the issue of what influence do each of these have in the market place. and do any of them, or do all of them, sort of -- are they the tail wagging the dog, which bob when you and i were talking about this a dozen years ago, that was the issue >> a spac, bob, is a kind of cousin to an etf as herb was saying, there are single stock etfs. a spac is kind of like that. >> yes, so here is an interesting question most of the market is invested in passive indexed etfs. there are a small percentage of etfs that are different things 2% and herb mentioned leverage and inverse etfs do we really need three times leverage oil etfs? i don't think so

some people do, fine as long as it is not a systemic risk and here herb and i are in complete agreement on this and i don't see a lot of evidence of that single stock etfs, i'm not a big fan. does the world need three times inverse tesla etfs i don't think so either. but the industry is changing and evolving and now that it has been saturated with so many etfs, they are looking for new business opportunities i say fine as long as i don't see evidence that it causes weird gyrations in the overall stocks or the overall market >> and what kind of signs would you be looking for to indicate that is the case, bob? >> well, for example we did have a problem with volatility etfs a couple years ago and they had to change the eflt etf, they had to tighten some bands. and that is how the market evolves. the important thing here is we have to keep supporting some kind of financial innovation that is out there. and these are financial innovations. we know historically, herb knows

this, sometimes things go wrong. there is greed that gets in the way. people bring in stupid products that we don't necessarily need i told you, i just tipped my hand there, some leverage and inverse products i don't think we particularly need them, but the industry as long as they think that they can possibly make money off them, they are pushing them fine as long as we don't see a lot of problems around them and you will see if that happens. by the way they kept saying for 30 years, herb you know this, 30 years ago they said who needs etfs nobody wants to bet with the market and turns out they were wrong. 20 years ago they said wait until these things start seeing volatility, they won't be able to trade the underlying stocks or price the etfs, it will all blow up. they were wrong on that too. they have been wrong for 30 years. >> but right now i would argue this is a test this has been the big test and the other question i'd have to ask, did etfs cause an exaggeration and have they continued to cause an exaggeration of what we've seen

in this market and what role have they played and i can tell you when you look at stories and studies written by etfs, one of the great lines from a moodys report is that the whole growth of etfs was during a period of market calm. not in the sense that it was k5 calm, but the market was just going up, there wasn't this great disruption now you have this disruption and growth of these products and you talk about them, some people are just putting products out there, wrapping anything into them. think about this, illiquid names in liquid etfs, that is another issue. >> herb, bob, it is almost like you guys should have a podcast and duke it out. >> that is a great idea. >> i'll be your executive producer in my spare time. >> wait until you hear about the title of poe pisani's book i'll save it as the ultimate tease. >> he is like please just go ahead and say it >> no, i'll save it. coming up, some gaming

companies are more leveraged than others. will that special trouble. and the biotech etf getting off strong, but is there one major headwind our power playbook looks at the names that could power higher by year end and before the break, let's take a look at shares of costco a top gainer after reporting a 10% rise in september sales. were you there last month? >> every month

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welcome back to "power lunch. shares of penn entertainment up more than 2% they were at least now backtracking a bit af after a buy rating saying that there is a real potential in its digital gaming platform. i happened to just speak with penn ceo ahead of a panel we're doing next week at the global gaming expo in las vegas and he told me that even with recession looming, rate hikes and access to capital shrinking, he thinks in spite of the headwinds, he thinks penn is well positioned with moves that it made last year, paying down debt and sitting on a pretty pile of cash my next guest says not every sector is so lucky joel, good to talk to you a little bit talk to me about these gaming companies, where they are coming from and where they are heading

into in 2023 >> yeah, as we look backward, fundamentals in the sector are actually quite strong. i was in las vegas last week you wouldn't know there was any recession coming in vegas given some of the strong conventions and lingering leisure demand we have the industry has obviously benefited the last couple years from the surge in demand, a lot of cost cutting measures but right now we're paying attention to the look ahead in the industry and how potential impact of rising interest rates will affect a sector that has really grown over the last decade or so largely through debt financed acquisitions >> last year when i was at the same conference, the theme sort of was massive amounts of mergers and acquisitions, that consolidation would be the name of the game. if you are looking at the price of debt and refinancing that debt, if you are looking at the access to capital, how will that affect what will happen with m&a

in this space? >> it is a great question. so if you look at the cost of capital in the sector, call it december 31, 2021, you looked at about an average borrowing cost of around 4% ten months later, you are over 8% so bottom line, that will cause folks to potentially pump the brakes on making significant acquisitions ahead of a potential slowdown >> who you said folks >> well, i think, one, buyers are waiting to sell if they don't have to sell there are certainly folks we've spoken to who are contemplating mone monetizing casinos and they are saying if we don't have to sell our business today, maybe wait for a smaller pool of buyers i think those who made acquisitions, perhaps they haven't integrated those acquisitions fully and they are thinking how do these assets fit in my portfolio longer term.

and so that could be on the bricks and mortar side, on the digital side given all the growth and deal flow we saw on sports betting and online gaming side >> and we pulled the debt to assets ratio of some of these companies. we've got caesars on here, draft kinks, penn and balis. are there any companies that you think are particularly well situationed to manage rising rates coming down the pike, and any that are particularly vulnerable >> you've pulled up a couple interesting names here one that you didn't list is boyd gaming boyd is right now three times levered roughly, which is the strongest balance sheet position i've ever observed this company to be in in the 20 plus years i've been in the gaming industry so i would look at boyd as a company that owns all of their assets principally, has taken a lower risk strategy to sports betting and online gaming and really could play offense. so i think from my perspective

as an investment banker, should certain assets on the las vegas strip become available or regional gaming markets, and again somebody has to sell off an asset to create additionally liquidity or really once you get rid of the noncore business, they might be better positioned to move more quickly than others one other factor you have to contemplate particularly when it comes to m&a in this space is the rise of the gaming reits mgm growth properties was acquired earlier this year and you also have gaming and leisure properties, other folks in the real estate sector have realized that gaming is very stable and predictable business, it faired relatively well in the more recent covid slowdown once casinos reopened so i think a lot of people find it a scarce asset class. and because you have the reits involved, that ultimately has raised sort of the, you know, the buyer universe material, and

also probably helped the industry from a valuation and underlying multiple perspective long term. >> one more company i want to ask you about, draft kinks has been under a lot of investor pressure.kinks has been under a lot of investor pressure.i want to ask you about, draft kinks has been under a lot of investor pressure.kinks has been under a lot of investor pressure what does that do in this current environment? >> and draftkings i think is definitely mindful that they have to slow the rate of burn. they need to accelerate in the markets where they have it a number are set to launch in the near term such as ohio, such as kansas. all eyes right now in the industry are really on attention for california you've proposition 26 sponsored by the native american tribes, proposition 27 by the commercial gaming industry. the industry really needs a big state like california to come in, that will be a significant and massive market it is really a tipping point for other dominos to fall across the

country, whether it is texas or georgia. so we'll see how that shakes out. i'd say right now the consensus is that came cal islifornia is to be happening. so we'll see but punch line is particularly if we go into recession, gaming has always been a way for states to capture new tax revenue in the past the notion was let's build a casino that is more expensive, harder to finance, takes a long time. so sports betting, online gaming, these are much quicker solution for states to tap into those tax dollars. the industry has the infrastructure in place. and i think that this will create opportunity >> and although we're seeing chicago of course building its first integrated resorts casino and same thing in new york as well joel, thank you so much for joining us appreciate it. >> thank you ahead on our program, corporations feeling the economic pressure. general electric laying off 20% of its renewable energy team

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shares of ge down 30 % this year and they are announcing job cuts seema mody has the details >> i'm told general electric is laying off 20% of its u.s. onshore wind workforce, or hundreds of jobs employees were notified here in the u.s. yesterday as the company exams its workforce in asia and europe. ge renewable energy spokesperson telling cnbc we're taking steps to streamline in size our onshore wind business for market realities to position us for future success now, energy shortage may be wreaking havoc on citizens and countries right now, certainly accelerating the need to reduce dependence on fossil fuels but the rollout has been

challenged by inflationary pressures, ongoing supply chain challenges not to mention for ge competition from the likes of siemens energy tax credits also tied to the "inflation reduction act" help but some experts we spoke to say it will take time for those incentives to pay off. we've seen shares of ge trailing the broader industrial sector down about 8% in the past month compared to the xli etf which is down about 6%. >> thank you for that. let's get to leslie picker for our cnbc news update >> here is your update at this hour a number of robotics companies are pledging that their products will not be used as weapons. the companies say their robots will not add weapon technologies to be working with customers to ensure that robots are used only as intended. boston dynamics ceo also called on policy makes to really allows to promote the safe use of robots swedish officials say their

investigation into the leaks in the to nord stream pipeline is pointing toward signs of a, quote, serious sabotage. the security agency says detonations caused the leaks and the investigation continues to look at additional evidence. and the mexican government is planning a lawsuit against u.s. gun dealers to try to stem the flow of weapons into the country. mexican officials say 60% of guns seized in mexico were sold in just ten u.s. border counties and smuggled into mexico this comes just days after mexico's lawsuit against u.s. gun makers was dismissed by a federal judge. back over to you >> leslie, thank you very much still to come, the 40s day of our week long power playbook. today we look at biotech many of those names were front and center during the covid outbreak, but 2022 effectively marking the end of the pandemic, we hope, what does the future look like for these stocks holiday hum drums, 80 days

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we got always less than 90 minutes on the trading day let's get you caught up. let's begin with woubob pisani >> and we were briefly in positive territory at the open, but maybe three or four minutes. haven't been able to stay there any convincing length of time at all. and the problem is there is not a lot of direction right now there you see the s&p 500 had a great start monday tuesday ehh. wednesday not so great and you see today really not a lot of energy. the problem is we're not buying enthusiastically in the groups that were buying earlier which were more risk-on stocks so tech stocks are doing okay but not amazingly well so we see chevron big gainer in the dow. of course oil at 88 dollars. caterpillar is holding up. salesforce has been good so far but flat today

laggards tend to be consumer stocks and industrial stocks so for example, coke is flat, not doing much honeywell has been down. 3 m has been a terrible performer this year. and the banks have been a little weaker goldman sachs is a big cap name with a very high price so as it is on a down day, that will have a big influence on the dow jones. and we'll be wait fing for the jobs report tomorrow 150, 250,000 is estimate. and we want lower than expected job growth because that will support the fed's idea of a slightly slower economy to combat inflation try explaining that to your mother it is very hard. we want lower job growth well, no but the stock market does. it is hard to explain. >> it isle a alilice in wonder . bond market, yields are slightly higher.e alice in wondd bond market, yields are

slightly higher. alice in wonde. bond market, yields are slightly higher. rick santelli has the news >> and we can question a lot of the direction and reasons why markets are moving as bob just described, but when you have jobs, jobs, jobs in the morning, that may be reason enough. consider we were up 29,000 initial jobless claims we were up 15,000 in continuing claims but if you look at a two year, we made our lows at 8:30 eastern. which means that fed speak trumped a rise in claims because even though we want claims to be low, employment to be good, we have to play this fed game where bad news is good new, good news is bad news if you look intra day of tens, you'll see the same dynamic. and maybe what is even more important is you consider a ten year note right now is at the highest yield since friday of last week. we have crept back it wasn't that long ago we were in the 350s. ranges have been large, whether it is in the fixed income space,

the sovereign space in general, or in the foreign exchange space. just look at the dollar/yen today, at current levels dollar/yen on pace for another fresh this year low close against the dollar going back to the first week in august in 1998 and it is had a nice bounce today, but maybe the most important thing, yesterday's high was 111.73. minute we climbed above that, it accelerated. so a close above that so see a green light into hire index levels going into tomorrow's nonfarm. and let's talk about oil closing up for the day there you see wt i-88.50 and one day after opec+ members decided to cut production targets by 2 million barrels a day. and look at some of these one

week moves, oil up about 9%, heating oil up about 13% and there you see energy etf, on pace for its best week since november of 2020 remember about a month ago we were saying this was the 90th consecutive day of falling gasoline prices. that is in the rearview mirror, folks. now we'll focus on biotech which saw a bit of a bounceback this week but the etf is down 0% this year led lower by names like moderna, bluebird and here with us from e squared capital management, les, we're supposed to be talking about biotech but it seems from your list of picks that you like biotechs a lot less than you like other portions of the health care world including big phrma, managed care, hospital companies and the like

why? >> you make me sound bearish i'll say this, we've all become interest rates traders in the last quarter and biotech tends to be adversely correlated to rates. so even though we've had a nice bounceback the last say half year because of some great data, i think that biotech is going to have a hard time going up until we see the end of the rate cycle. >> so it is really the same argument that lot of people make about why technology shares are inversely correlated with -- technology i'm thinking of the apples and metas and so on they are inversely correlated to interest rates >> that's right. well, the tech and biotech is technology so, yeah, so while there will be some winners, and there will be some m&a and some good stuff this biotech, i think that you've got more of your leverage in the mid cap, small and mid cap biotechs than the big caps

which tend to drive the index performance. so, yeah, again i hate to use the cliché stop pick, but by toek, you pyou pick one and youn have i don't -- >> if i'm reading you right, you think that it may be a while before some of these smaller and mid cap biotechs are ready to move >> right and you know as a way to play it, we would suggest some of the helping companies like a cy tech or alumina but managed care, we have good visibility in the numbers. phrma probably should be okay, you know about, as a yield play. med devices, again, probably waiting for 2023 but they are doing fairly well and you know, as an interest rate hedge, we're in health

equity which does well when rates go up. i'd also point out there is a number of very cool private companies in biotech like valo that if the ipo window ever opens up, their representatives have exciting things that can come again though i think that is more of a 2023 story than fourth quarter. >> if you are paying so much attention to rates right now, how are you feeling about the stronger dollar and its impact on bay owe biotech and other ay fields >> well, biotech mercifully they are not really exposed to the strong dollar, but big phrma is. and large device companies are so they will almost certainly see an impact. i think they have sort of been rerated a little bit to reflect that managed care isn't so that is a good thing and also hospitals and some service companies are not. so again, i think some of it has been priced into fundamentals,

but i don't think we've seen the magnitude of the dollar move i think that there will be some very -- if we're going to switch from rates traders to currency traders for third quarter reports, we'll learn about the strong dollar. >> it is like being a jack of all trades, isn't it >> i want to go back to watching health care companies. i don't want to know interest rates or currency. but it comes with the territory i guess. >> for sure it does. les, good to see you thank you. up next, retailers expecting the worst from this year's holiday season inflation remains high there are concerns over the economy. that is not going away consumer cracks are beginning to show we'll dive into the latest reports on what we can expect. and then as we head to break, throughout hispanic heritage month we're celebrating our cnbc teammates and our guests here is charles schwab investment manager ceo and cio

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welcome back 80 days until christmas. the pressure is on already some retailers are starting to worry inflation could take a bite out of the holiday spending courtney reagan is joining us now with those numbers hi, court, nice to see you >> hi, contessa, good to see you. both target and kohl's kick off early sales events today ahead

of amazon's second prime day sale this year and although the american consumer is holding up brelt, there are signs that it could be a ho-ho-hum bug holiday season and while target and amazon are planning to hire the same number of seasonal workers this year as last, walmart and dick's is looking for fewer workers. why? possibly due to concerns about holiday sales. deloitte, alex partners and mastercard spending pulse all expect holiday sales to grow less than the current rate of inflation, effectively a decrease in real sales consumers are expressing concern about the economy and their financial health 57% told shopping traffic that finances will play a role when they begin holiday purchasing. that is up from just 14% that answered that questioned that way last year. and about a third of shoppers plan to spend less this holiday season, only 17% plan to spend a

little more. with 40% planning to buy more affordable brands due to inflation. >> all right so number one, i'm always skeptical about this because if somebody asks me how much i'm planning to spend on the holidays, i'd be like i have no idea until i decide that i'm going to buy the stuff so good for these people for knows how much they will spend secondly, we've talked so much about all this inventory and how the retailers are starting to discount is black friday just dead because we've already seen all of these sales happening online? >> such a good question. i wouldn't say black friday is dead and i also ask this question every year but it definitely has lost sort of the volume of sales importance it is still though expected to be the number one shopping day of the entire year according to sensor-matic which does count traffic in stores. and when you put the top ten

busier shopping days together, it will have accounted for 40% of all holiday sales but to be sure sales are stretched out. we talked about how target and kohl's are already starting events right now black friday is already a blurred line anyway. saturday, sunday, cyber monday still a big day, but might not be as big as it used to be. >> i'm skeptical that courtney is saying this because i feel like she's setting the scene so that there doesn't need to be a black friday reporter up at 3:00 in the morning and out covering the waiting lines outside walmart or best buy or whatever. courtney, nice to see you. >> i love it i live for that stuff. >> yeah, absolutely. coming up, we will run through some of the biggest moves of the day and get our traders to give their picks as the dow falls right now to session lows lost 343 points. s&p off a percent as wl. el

. time for three stock lunkment we're going to look at three stocks making moves. peloton cutting 500 jobs as it races to turn itself around, transocean shares after barkley

said the stock could surge pinterest said its shares could have 25% more upsitde let's start, jeff, with peloton. as people may know, i am an owner of a peloton i like the peloton they're cutting jobs, are they going to cut some of their instructor tor are these back office, manufacturing, sales jobs >> yeah, i think it's basically some of the back office staff. look, this is a covid darling but it's down a ton. the question is is there value here to your point you hear a lot about restructuring contracts, cutting costs. the announcement today i don't know that the news is good, and i don't think the stock is particularly cheap, and i think that's the key when a stock has moved this much. it's not supposed to be profitable autoout to 2027. if you take today's stock price at 2027 earnings, it's still trading at 230 times

i think there are better places to put your capital right now. >> that's a nice way to say it >> transocean is next. we go from cycles to the seas. >> yeah, a big difference here this is kind of a complicated one. the stock got whacked. it was down 40% last month, and it was really due to some liquidity problems that i don't know necessarily go away there may be some more shareholder delusion in the near tem. the stock is now up 40% in the past couple of weeks longer term, there is a case to be made. you have some of these rig rates going higher you can make the argument that you're at the dwbeginning of th upcycle. there could be upside in this name at this point given the problems with their balance sheet, you are making a speculative trade. >> we have another name that begins with p, pinterest, and look at the similarity between those logos there. peloton and pinterest. look, we got rid of it, but talk to us about pinterest.

>> yeah, tyler, this is one that i actually kind of like. i think about a bad market and a good chart, and this falls into that category. it held 18, which i think is a pretty important level the 50-day is now hooking higher it's now above the 200 day moving average for the first time in a year there's some momentum in the stock. relative to the business, sure, you're seeing some slowing growth, but user growth is now stabilizing, which i think is important, and maybe most important in this market, it's a money making business. you have improving free cash flow margins, really important in this kind of market, and you know, the new ceo seems to have a clear vision, really capturing more commerce related to some of their users. he has that background from his time at google this is a stock that i think there is some pretty decent upside. >> let's come back to that peloton thing. it's selling at 200 and some times what year's earnings >> so it's not going to be profitable until out to 2027 if you look at that out year

earnings and you put today's price on it, you're assuming it hits profitability out in '27, you're still talking about a pretty lofty valuation. >> five years to profits jeff mills, thanks. up next, how leaders and investors solve key esg challenges we hear from some of them, and look at the market right now boy are we losing some steam here on the dow jones industrial, off 1.22%, down 368 points we'll be right back after this >> catch the market zone today and every weekday on "closing bell," sponsored by e-trade from morgan stanley trading to help sharpen your skills, you can stay on top of the market from wherever you are. power e*trade's easy-to-use tools make complex trading less complicated. custom scans help you find new trading opportunities. while an earnings tool helps you plan your trades and stay on top of the market.

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welcome back to "power lunch," everybody. we close with this, the state of louisiana pulling nearly $800 million back from blackrock funds. the issue here is blackrock's es g- es mandates the state says is going to cripple, so balancing climat climate goals with financial needs. it was a key topic at today's conference let's listen to a little pit of what was discussed j we think the market is ready to have a conversation about economics and so we don't need political theater on either side we need to work with the biggest public companies in america as a capitalist system was set up to do to take material impact areas into account if you think about it that way and you think about it as aligning how the companies have higher value over time as well as how they can quantify and address their major impact areas, it becomes extremely

constructive >> we do it because we think it's right, but we also do it because we think it's going to be the better business i don't think there's any question for a modern company, a forward thinking modern company that we need to be carbonized. in fact, when i speak to our most important investors, whether they're european investors or american investors, they're telling us go as fast as you can, and that's what we're trying to do the policymakers, they set the framework, but then let the market do -- let the market do the magic. >> he was answering a question from jim cramer about you do this because it's right, right >> right. >> and he said, yeah, we do it because it's right, but we do it because it's good business and because that's where you have to go to be in a good business 15 years from now. >> i talked to houston's mayor who was part of this panel, and talking to him about their big esg plans for houston, and he said the energy sector in houston and the surrounding area

is partners in making this go forward, much to the direct opposite of what we're hearing from louisiana >> and you think, i think he mentioned the houston mayor said the percentage of renewable sources that they're going to like 80% by 2030 or something like that. >> you can see more from the mercedes benz ceo tonight on "mad money" at 6:00 eastern. that does it for "power lunch." >> thank you for being with us >> "closing bell" starts right now. stocks pulling back, we're sitting near session lows but still tracking for big gains on the week this is the make or break hour for your money welcome, everyone, to "closing bell." i'm sara eisen coming to you live from washington today take a look at where we stand in the market the low for the down is down about 400 points we're not too far from that level. the s&p 500 down a full percent. the only sector that's in positive territory right now is energy, oil prices, holding their three-week highs after we got that decision from opec plus to tighten crude supply, cut production everybody else is weaker, and then some sharp declines