nasdaq lower by more than 2% today. 10366. if you put bitcoin up there you would see carnage as well, folks. >> yeah. disney the biggest loser on the dow. that does it for "power lunch." >> thanks for watching today and "closing bell" starts in four seconds. lows of the day, stocks losing steam throughout the session with disney weighing on the dow, taking about 80 points off. crypto uncertainty hitting sentiment ahead of tomorrow's key inflation print. a make make or break hour for your money i'm sara eisen take a look at where we stand in the market, down 574 disney not the only story, unh, chevron, apple the biggest weighs s&p 500 down 2% right now. every sector lower hardest hit today is energy down about 5% consumer discretionary is slammed as well.

tesla is a big part of that story that has weakened more than 50% off recent highs in a downward slope since the twitter deal nasdaq down 2.3% meta one of the few winners in the nasdaq right now check out the carnage in crypto. two-year low on bitcoin prices as questions swirl about the ftx-binance deal there's bitcoin. coming up we will talk to real estate titan howard lorber about the state of his industry as mortgage applications sink and rates sit near 20-year highs levi ceo chip bergh will join us as michelle moves to the denim giant to inherit his role. the big stories we are following this hour, three of them, mike santoli, bank of america's jessica earlick is here to talk disney and jimmy is with us to discuss the implications from the midterms

mike, start us off with the market, weak 10-year auction, bo bitcoin, the midterms? >> a lot of excuses to lighten up on risk today you mentioned some of them we got an atlanta fed gdp update at 4% for fourth quarter gdp before noon. that was the highs of the day for the s&p. yopg that was the cause but creates this idea that it tops up the budget the fed has to work with raising rates. apprehension ahead of the cpi numbers tomorrow which have been big market movers. more to the downside than the upside it's brought the s&p down to the week's lows. this level 3750 we're hoping might hold to the downside it was pierced on the downside in september, chopped around that mostly in the last few weeks. a little bit of a decision point in the markets here. still in the downtrend i've been pointing out you can

read this as resilience, as huge tech disappointments the fed, all this stuff loaded on the markets hasn't broken down the other side it takes a lot of energy to tread water and sometimes you slip under the surface. energy relative to communication services has been the story of a tidal shift in the markets this dates back to the start of when the communication services sector was created they shoveled a lot of f.a.a.n.g. stocks in there to join media and telecom and had a run into the highs in 2021 and now energy is overtaken it over that span. what do you see? just the slightest curling in that direction meta is helping as disney's offsetting it today. i'm not saying it's necessarily going to reconverge but interesting how far things traveled away from the virtual economy back toward real assets and commodities in the inflationary times >> energy stocks punished more than prices today. i want to mention the bond market because we had a weak 10-year auction. i don't know if it's qt, the

fact that fed is taking away the punch bowl, less demand for dollars, what's the impact >> i think it's the cpi coming tomorrow and yields are in an uptrend has been a tough trade to buy dur race when in that situation and as i said the gdp now number was relatively hot before that. >> core cpi 6.5% expected, 8% overall. thank you. disney is the worst performer on the dow today after missing the earnings expectations and warning its streaming growth could taper let's bring in jessica of bank of america securities. jes cut the price target for disney down. worst day for disney in 2 1/2 years. do you think this is an overreaction >> look, stocks don't go up when estimate comes down and that's exactly what happened. the company unusually for them,

brought guidance - gave guidance and they're both cyclical and secular challenges. it's not any surprise that linear business is challenged because the paid tv universe is declining and it's been in an accelerated decline. advertising is challenged because of macro headwinds and that's true whether linear or digital. disney has positive catalysts coming up and we are sticking with a buy. >> it's at 87. you think it's worth more than it is. what are the positive catalysts and why were you and others on wall street so surprised have they not managed this in terms of expectations? >> well, the quarter was a surprise in theme parks for us they launched disney ship which is doing well. hurricane ian which we did anticipate and then costs were up in part due to inflation. looking ahead, i think there are a number of cat ta lists

this weekend's "wakanda" is tracking very well and before christmas, we have "avatar 2." the first was the biggest movie of all time. between now and then disney will launch the new ad tier and tremendous demand for this platform remember that when comcast, your parent company, introduced peacock, they generated $1 billion in advertising in the first year, with negligible subs disney has a big platform, tons of interest, three to five minutes an hour, so limited time this will be addressable and really added up. we think the ad tier is a big positive on december 8th they have a 38% price increase that goes into effect that same day, so there are a lot of things the theme parks are still incredibly strong, and we'll start to seat direct to consumer losses coming down sequentially in the first fiscal quarter of

the december quarter there should be a big swing in losses from $4 billion fiscal 22, our projection is $2.5 billion in fiscal 23, so it starts to move towards profitability in fiscal 24. >> and that is what the ceo bob chapek reiterated, that they have - they are hoping to achieve profit beib-- profitability in 2024. you are not questioning that and think that is achievable there are questions about execution. jim cramer raised them this morning. >> i heard no the dtc loss came in on target for our model the miss was on theme parks. look, disney doesn't usually guide so i'm sure numbers are all over the place, but the direct to consumer business is on track they finally related their content cadence stride 100 originals a year or two a week on average so i think the number --

disney plus is actually doing exactly what they said they would. the company said many times last night in the calls and the call backs that there's a big focus on cost control. now they need to execute i think that's what the street needs to see i think there are a number of catalysts coming up in the next few weeks. >> jessica, reiterating her buy, thanks for joining us from bank of america we'll turn to the midterm elections. investors are focussed there results are still coming in with the control of both the house and senate still up in the air but the democrats had a better showing than many were expecting. joining us is jimmy from american enterprise institute. as far as investors are concerned, jimmy, i don't know, if they were bullish on the idea of gridlock still looks like we're going to get that with the house of representatives going to republicans, even if it wasn't as big of a margin as they were expecting. >> if you buy into the notion that gridlock is good, and i

think gridlock is not good, we need to do a lot with immigration and deregulation, but if you think gridlock is good that might be the case unless, of course, the gridlock means there's gridlock over raising the debt ceiling that is not good i think before the election, people thought well, we might get good stuff here. gritds locke is bad. we'll extend the trump tax cuts or something now the gridlock is, oh, boy, there's going to be a clash over the debt ceiling which could happen and gridlock not so good. >> no. and that's why maybe there will be pressure on the lame duck democrat congress to pass something. do you think that can get done or no? >> they got to do a lot. >> on the debt ceiling >> you know, there's - remember that permitting reform bill supposed to go with the inflation reduction act, that's floating out there i think there's -- i think there's going to be a lot of pressure on the biden administration to get that done.

you can just see how this conflict is shaping up if republicans end up with only the house and barely the house, you know, the sort of wilder outlier members of the republican party are going to have more influence. it's just not hard to see how this can look really, really u ugly next year it would behoove the biden administration to get that done. >> the wisdom on wall street another reason gridlock is good at the moment is to rein in fiscal spend, that the republicans can put a check on the democrats' tournlg spend in an inflationary environment, good for bonds where we've seen a big sell-off shake the stock market there's something to that. >> we're not going to get a stimulus package at this point if there's a recession. >> maybe they can drop the student loan package, pair back the inflation reduction act. these are things we hear the candidates talk about.

i don't know what's achievable it would amount to less fiscal spending. >> listen, i think if you're going to bet on more or less, i think you would want to bet on less not only do you have this, you know, likely split where republicans may have very narrow control of the house, but then you have the business cycle, meaning the huge inflation surge which itself i think makes giving spending more spending done very, very hard because democrats au assume they hold the senate, they have a very narrow hold. if you're worried about a flood of spending that juices the economy to offset what fed is doing, that's not going to happen. >> jimmy, as someone who talks to investors, what is your read on where the market is on trump? because now there's a question, right, of whether he'll announce, how he'll take the

results where a lot of his backed candidate did not do well, including dr. oz in pennsylvania and what that might mean for 2024? where do you think investors are? >> i won't psycho analyze or get inside donald trump's head but when i talk to people, republican donors, they would love to see ron desantis run for president. i think ron desantis is going to run for president. i don't think he's going to make that chris christie mistake. at that point i think it's - i'm not sure you know exactly what is going to happen with the republican party, if it's going to continue down the trump populace lane or something that seems a little bit more recognizable to republicans where they talk more about tax cuts and deregulation. i think if you were expecting a sort of rerun of trump, obviously, last night puts that in some doubt. >> jimmy, thank you for your first take appreciate it. market impact on the midterms, down 500 points on the dow

just about the low of the day. the s&p 500 down 1.6%. levi straus dropping some big news this week announcing michelles michelle goss will move over to the chip chip bergh about his read and more you're watching "closing bell" on cnbc. this is redefining storytelling, at the speed of now. this is tracking and publishing your content in real time. this is the system you built, captivating a global audience. this is how. airtable.

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president with plans to become ceo over the next 18 months. joining me now exclusively is current levi strauss ceo chip bergh. welcome back. >> great to be with you. >> big announcement, how did this come together give us some of the back story, if you could >> sure. well, you know, as any board would do, our board of directors has had a very rigorous process, which i've been involved in, i'm on the board, around ceo succession and we've been working it more than four years and they reviewed twice a year external candidates as well as internal candidates and michelle's been on the list since the very, very beginning i would say we've been working it very aggressively when the activists struck kohl's in september, you know, the head hunter firm we worked with, i

called him up and said it might be time to give michelle a call and see if she will answer the phone and consider another opportunity. so literally, this moved very, very quickly, the activist situation at kohl's for the third year in a he row created the opportunity for michelle to answer the phone and when she heard the opportunity was levi's, words out of hr mouth were the same words out of my mouth 12 years ago, oh, wow, that's like a dream come true. and i've known michelle for ten years. she's an incredible reader and so this is also just a great opportunity for a well thought out and structured transition plan between her and me. >> well, as i pointed out yesterday, can't really be that much of an activist target with a family control of levi, so i understand why in that sense it would be appealing why michelle what do you tell investors who

look at the record at kohl's an she certainly had some successes, partnerships with sephora and amazon, but some mixed on the profitability front. there were activists involved and didn't sell the company >> right so i think i've gotten this question a bunch of times as you can imagine over the last couple days and it was part of a discussion with us at the board as well, you have to take a look at michelle over the course of her entire history and look at what she brings to this company when she joins she's got an extensive career over 25 years of solid retail experience, ten years at kohl's and another 17 years or so at starbucks. she started her career like i did at procter & gamble. she spent her first six year at p&g doing brand management where i started my career. i lasted there for 28 years. but, you know, she's got classical brand building skills.

at starbucks she's associated with so many great things starbucks has done when she joined they had 800 stores, when she left they had 20,000 stores. her hands were all over frappuccino the core franchise of theirs. towards the end of her career at starbucks she ran the europe, middle east and africa business, both p and l responsibility, franchise partners there as well hands on retail operations in that particular role then, you know, with respect to the kohl's question, here's the way i look at it, sara i think you have to ask the question, was kohl's better off because of her leadership? there's no disputing the facts around what's happened to their stock price and everything, but that's true for all of us in this industry and the department store sector, as you well know and we've talked about many times, is structurally challenged in this country when you take a look at the things that she has done there, the pivot to active wear, the

growth of their loyalty program, the doubling down on digitalization, their digital business has grown from a billion dollars to $6 billion, which by the way is about the size of total levi's, $6 billion over the ten years she was leading that business, and then, you know, the ju jitsu move of inviting amazon into their stores with the returns program, which was a stroefk brilliance when department stores were challenged with traffic, and then most recently whipping the shootout over ephora. >> yeah. >> i can tell you from a levi's standpoint we are seeing the impact of sephora on our women's business our women's business from the sephora doors is up meaningfully ahead of our women's business in non-sephora doors. that's an early data point i think sephora is going to make a long-term impact on the kohl's business

you can't argue the fact around the stock price, but i think she's had an incredible impact there and she's an incredible leader that really drives innovation. >> chip, question, you have been as a company, as a ceo, more outspoken than i would say a lot of corporate america on social and politically divisive issues, i'm thinking about coming out against the abortion ruling by the supreme court, on guns, and i'm curious how you view the midterm elections and are potentially bracing for more republican control in congress where a lot of republicans lately have called out companies like yours for being too woke. are you going to do anything different? >> no. i don't think we'll ever do anything different what we've done is what we've done as a company for 170 years. it is part of who we are it's part of what makes the role of the ceo here such a, you

know - such an incredible opportunity i think because we have moved the needle on many important social issues of the day in this country and even during the period of time that i've been here, you know, we took a stand on ending gun violence in this country and we back in 2019 we led a ceo letter to the house of representatives to get house of representatives bill number 8 passed we had four ceos sign that letter most recently with the safer communities act, we got over 500 ceos to sign a similar letter and that legislation actually passed and is law and it is starting to make our communities safer. so we really think of ourselves as not being afraid to lead and when we lead, others will follow we believe that part of the role of business is to make an impact in the communities where we live and work so we're not afraid to take

stands on important issues of the day and to stand up for what we think is right. you know, but the change in congress - i did it during the previous president's entire administration, and it didn't stop us. we'll continue to do it. >> and really quickly, could you give - i know you reported earnings early in october, update on the consumer any signs of weakness, whether it's dealing with the inventories and promotion or just in terms of consumer spending we're monitoring all these things for changes as fed continues to tighten >> yeah. you know, it's such a mixed picture, sara. the nrfs data, i'll tell you what nrf is saying about the holidays, going to be up mid single digit its i think we're seeing some softness in the lower income consumer segment we have two value brands that are mostly mass market, lower priced products and those are

feeling a slow down in demand and the lower income consumer is pulling back but, you know, the expectation is for a relatively strong holiday season coming off of a strong one last year it's mixed signals in the u.s. i would say europe it's a little bit more challenging right now and a lot of fear about inflation and the impact of higher energy costs heading into the winter but here in the u.s., our sense is the consumer is still reasonably in pretty good shape despite all of the inflation you know, we're watching it very, very closely but i think we're going to have a decent holiday season. it will be more promotional. there's no question about that consumers are going to be looking for good value and the great thing about levi, we're quality that never goes out of style. >> and we are all still trying to catch up with the post-covid

denim trends which have changed. thank you for sharing your conversations you're having with your investors rising mortgage rates keep taking a toll on housing demand. real estate investor howard lorber whether she sees signs of a rebound on the horizon we're continuing to lose steam dow down 543 we'll be back. a careful steward of the things that matter to you most. i promise to bring you advice that fits your values. i promise our relationship will be one of trust and transparency. as a fiduciary, i promise to put your interests first, always. charles schwab is proud to support the independent financial advisors who are passionately dedicated to helping people achieve their financial goals. visit findyourindependentadvisor.com

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. new weekly data on the real estate front mortgage rates continue to climb throwing cold water on demand for potential home buyers and third quarter stats from douglas el herman showingcondo sales falling in 18 months howard lorber executive chairman of douglas ellerman, how bad is the market pressured by the rising rates >> rising rates have pressured the market but realistically you can't use 2021 as a gauge for other years. i would say that our third

quarter was probably the second best quarter we've ever had in business the only one that surpassed it was 2021 so if you go back to like 2019, precovid, we did better than that this year. >> right so the comps are strong from last year. >> strong -- >> holding up -- >> i'm not saying it's holding up it's less than last year, but it's somewhat not a good judge just because you have one year which no one really understand how or why it happened okay >> yeah. >> and then you go back to more normalcy and everyone thinks business is terrible it's not terrible. we're busy doing deals all the time maybe we have an advantage because we're in the luxury markets and those are better than low-end markets. >> that's what i was going to ask, if luxury is holding up better what about rents because rents have stayed high

and actually climbed as people are sort of forced out of buying now into renting and that's a part of the cpi which the federal reserve is targeting w when do rent comes down? >> i've read in a lot of markets rents are coming down already. for sure in florida and in new york, the reprents are still hih on the luxury rentals the high end are astro nom al pricing, things we've never seen before on a square foot basis rents are in pretty good shape and maybe that's because people aren't buying as much as they did before and so they're renting and they don't mind paying more in rent. >> you mentioned new york and florida. i was going to ask about both of these markets because we got the results of the midterms, the governors stay the same overwhelmingly so. do you think when i talk to developers, why are people moving from new york to florida? a lot comes down to the

politics do you think the trends of business and hedge funds going to florida from new york will continue >> look, i don't agree those were the number one factor i think the number one factor i think there are two and they're close. one was taxes. okay no state taxes as opposed to new york especially here in the city number two is, quality of life people are moving down i think crime is less here they're worried about the crime in new york. having said all that, new york is not going away. and i've been talking to so many people and a lot of people moved here even though they moved with their families they still kept the house or apartment they had in new york. so that shows you what they think about new york i think and i've said it before and quoted that i think new york city, once they work a little bit more on the crime problem, get that crime problem down, i think will be the number one second home market to the world.

>> that's good news for us new yorkers. so howard, are you building right now? what is all this doing, the rising rates and changes in the market, doing to development and building pipelines and ultimately how is that going to impact inventory >> in new york, no one really has started anything new for the last few years since covid came. florida is booming on new developments there is so much new development in florida and they're at all ends, the lower, mid and really high-end luxury crazy prices we're seeing prices we just saw a sale in a project that we're selling on miami beach that approached $7,000 a square foot. >> wow no slowdown there. so no softening. >> nope. well maybe volume have softened a little bit but people are

still buying. >> howard lorber, thank you very much good to get color on the market. appreciate it. >> my pleasure thank you. let's show you what's happening in the market. we have just over 25 minutes left of trading and we've deteriorated down 557. we're negative on the week for, let's see, the dow is holding in there for gains on the week. looks like it has -- dow still up everybody is down. s&p down 1.8%. adidas generating buzz as it gives clarity on the full cost of cutting ties with kanye west. the impact on the company next

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what is wall street buzzing about? fallout for adidas from the ye debacle cutting its '22 forecast again, this time because of the breakup after the company ended its relationship after kanye's anti-semitic hate speech and says revenues will grow in the low single digit it rage this is fourth cut adidas has made to these numbers after china lockdowns, inventory pileups the russia business and ye it's a sharp cut from earlier this year when they guided 13% revenue growth and as high as 11% operating margins. executives making it clear that

adidas owns the ip and they will use the designs rebranding the sneakers as we highlighted they might a few weeks ago. there are plenty of issues for the brand new ceo to tackle. adidas did announce ba john gorgon who led puma will be the new ceo. the long-time ceo leaving after this week. the stock, up today, potentially because the company said it will adjust the size of the organization, i.e. warning of layoffs and cuts, hiring freeze in place since september but this is a stock that is down 64% over the last year when we come back, we'll hit the sell-off right now which is worsening down almost 600 points on the dow the s&p down 1.8%. ever corp's mark mahaney on layoffs. it is one of the few winners right now in the tech space. we'll be right back.

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breaking news on binance and ftx. kate rooney has it binance walking away. >> the wall street journal reporting binance is walking away from the ftx deal and binance's issues are beyond our control to help, they're saying a company's statement, we don't have the statement yet, again, this is according to dow jones, binance cites due diligence reports on mishandling of ftx customer funds for dropping that deal again, this was a letter of intent nonbinding they didn't have the obligation to go through with this deal it was up in the air we had reports they may not go through with it, but looks like officially the company saying

via "the wall street journal" a statement that they are not going through with the ftx bailout. >> wow kate rooney, thank you bitcoin falling now almost 10%, looks like broader market getting hit down 600 points on the dow. beyond our control or ability to help does not sound good >> it doesn't. it's the unknown what's below the surface with the iceberg's danger lies. that's been the concern for a while. look at the stocks leading to the downside, and it gives you some vague idea of what is owned by those who might also be very exposed to crypto. so things like nvidia, tesla down more than the overall nasdaq there's no way to say that one caught other, but that's the general environment here if you have a multibillion dollar loss you didn't expect to be there a few days ago, it's in the system, so i think it's weighing on risk sentiment the way i put it as opposed to threatening any chain reaction in the direct way. we don't know >> you don't think there's some

of that leverage tied to nasdaq stocks, some of those -- >> could be. but $6 billion is nothing against the nasdaq, right. i think it's much more about who has to sell stuff to cover other losses and again another excuse not to take risk ahead of a data release tomorrow in a market that's had a hard time summoning upside momentum. even though it stayed supported, we've not really gotten free of that lower end of the trading range. >> a lot of questions here, kate rooney looks like binance is citing due diligence, reports on mishandling of ftx customer funds. this is clearly something regulators are going to be looking at. >> this raises a lot of questions. investors i've been talking to in the past day poured cold water on the idea this would happen and the questions what happens if binance doesn't go through with the deal. is it bankruptcy court for ftx, the international side of the business what happens to those customer

deposits the legal liability. it's not clear there's another backup option that's going to want to come in here based on what we're hearing from reports on their balance sheet and some of the questions that binance had. who would have a balance sheet big you have no now bail out ftx based on who we know and have the risk appetite at this point to want to buy the customer deposits on the cheap and inherit the liability that will come with it >> what do we know about any potential investigation? >> so there's reports of an sec investigations we've reached out. i'm told this is a potential doj issue. investors say there may be liability in terms of sam bankman freed and what he told his investors of the co-mingling of customer funds and ftx, and alameda his hedge fund he founded, saying there's issues there. probably going to bring that to court. and he's going to have a lot of legal headaches here we don't have any clarity on

which regulator that is because there's multiple ones that oversee crypto. >> do we know anything about how the firm handled customer funds that would be problematic? >> we don't at this point. we don't have any indication that they were investing customer funds but that's one of the big issues that brought down companies like cell serious and voyager, they were taking risk with customer funds looking to get more leverage. that's something ftx should not be doing it's an exchange they should be the middleman between the buyer and seller no reason you should think as an investor or backing ftx that they would have that type of liability. i think it would come to a surprise to a lot of people if they found out that ftx was somehow this levered and taking risk with employee funds we don't have evidence yet that that's the case. >> hard to speculate, but either the financial hull was too big or there was something shady in terms of how they were dealing

with customer accounts >> right it could be any of the above it could be the risk/reward of absorbing the headache and liability is not there for binance. we, obviously, don't want to necessarily, you know, go into conjecture too deeply here, but, you know, i do think the first loss is likely those people who invested in ftx. we don't know how much in the way of other customer crypto holds are at risk. >> the venture funds sequoia. all these major players. >> with a relatively recent capital raise at a pretty high valuation. >> what about ftx customers? do they lose here? >> it seems like it. that's one of the issues here is if this goes to bankruptcy court, that the big thing sam bankman-fried said in the deal when he announced the begins of the deal saying customer deposits will be safe and been the poster child for consumer protection and one of the reasons he bailed out other

companies was his argument that customer funds need to be protected. it's not clear they will be in this case if they're not - if they don't have the capital to meet customer withdraws they don't have the customer confidence to not have people pull their money from the platforms that's a big question mark the other thing what happens to the deals at the other companies that sam bankman-fried bailed out. that ink is not signed voyager got caught up in state security company there's still customers with their money locked up on other exchanges supposed to be bailed out and get their money out that's not looking likely right now. >> kate rooney, thank you very much we'll come back to you as soon as we learn more not inspiring a lot of confidence, mike, in the system, especially with these ripple effects and ftx and sapds sam bankman-fried and more broadly than that. >> for sure. there were questions all along the way as ftx was acting as

savior, rescuing the other counter parties. it did seem as if, you know, ftx itself had exposures to them and relationships with them and there was all along the way this idea that it's - he's trying to essentially prop up the system and make sure the ecosystem didn't fail. look, we don't know exactly how this is going to play out. i do think it's still relevant that for the most part, the impact has been on crypto, prices of crypto there's been a multitrillion dollar on paper loss sustained in aggregate by the system if you thought of the entire world as having one portfolio that piece is down tremendously. it's almost a one-year anniversary of the peak price of bitcoin and you're down huge from over 60,000 to 16,000 so that's been absorbed and that is down much more in terms of agate dollars but so far in terms of stresses in the system it's stresses in the crypto ecosystem. what is it endangering in the

way of actual projects that might have sustainable value or role in the financial infrastructure in the future i have no idea and i don't think anybody knows that here we are with really a couple of individuals, personalities, deciding whether this entire asset class is going to have, you know, prospects beyond just having been speculative several years of upside and downside >> coinbase down 9%. robinhood, bankman-fried owns a stake in, down double digits we're going to follow it the news, binance walking away from an ftx deal that is being reported right now by the "wall street journal" having an impact stocks at session lows we'll go into the "closing bell" market zone. cnbc senior markets commentator mike santoli here to break down the crucial moments. julia boorstin on disney, mark mahaney on meta.

we are seeing stocks norv session lows, down 2% on the s&p. every sector lower and we've seen that it's really energy getting crushed the hardest down 5% right now consumer discretionary down 3% technology is having a rough day. most of these big cap tech the stock lower except for meta. to shortage of catalysts what are you watching? >> all of it the bond market, i don't know if it's a little bit of the safety bid but aside from the 10-year which had a bad treasury auction a couple hours ago, you have yields that are tame maybe that is because people are grabbing at something relatively safe i do think the fact that you have energy on the downside when you have mega cap growth stocks giving some of that back explains your 2% down day. lows of the week holding in that range of up 8% from the mid october lows seemed like two-way risk going into the cpi tomorrow honestly

because if it's a benign number people talk again about how we have the green light for that supposed seasonal strength meant to follow the midterm elections. >> disney biggest drag by far reporting a bottom line miss as well as weaker than expected revenue because of streaming business losses that doubled for more than a year ago julia boorstin joins us. what does the ceo need to do to reassure the investors he's getting the company back on track? it's not the first setback >> look there's so many questions here, so many challenges especially going into a tougher macro economic environment but so much of investors' concerns are about the fact that streaming business is losing money and this is an incredibly expensive venture here for quite a while the whole media industry was focused on growing those top line streaming subscribers, but the reality is now, the subscribers need to be profitable so i think in the coming quarter, the fiscal first quarter for distaney the compan

needs to show traction for their ad supported service as they raise prices for the ad vee frergs of disney plus, subscribers are not churning out at too high a level. how well bob chapek can start generating profits from the streaming business and perhaps investing less in the types of content that are not yielding real subscriber loyalty there. >> yeah. fiscal 2024. we will see. disney getting hit hard today, worst day in two years meta going the other way, higher after confirming reported job cuts, announcing layoffs affecting 11,000 employees or 13% of the total workforce mark zuckerberg saying he had overestimated post-covid growth. zuckerberg speaking to the company earlier today and meta employee impacted by today's layoffs provided this video to nbc news take a listen. >> i take full responsibility for this decision. i'm the founder and ceo.

i'm responsible for the health of our company, for our direction, and for deciding, you know, how we execute that, including things like this, and this was ultimately my call. it was, you know, one of the hardest calls i've had to make. >> let's discuss mark mahaney, maintains his outperform rating, $170 price target icy when wall street cheers layoffs like this. how should you look at the significance >> well, the note we put out, we described this as the biggest, fastest pivot i've seen in a two-week period. the setup is that the company, this is belt tightening mode all the companies, amazon, i look at, google, if you throw in microsoft, apple, all seeing softening demand trends so investors want these companies to tighten their belts two weeks ago, when facebook announced these softening trends

that were in line with expectations they refused to slow down their expense growth for next year or didn't do it enough they sounded aggressive about growth for the following year and so the market very quickly expressed its sharp disapproval, stock shares went up 25% looks like the management team and zuckerberg have listened, have - and are heeding that and changed their '23 capex and 2023 operating expense guidance that's a fast pivot but that is what is necessary, at least that's what market thinks. >> here's my question and the stock has been beaten up for a number of reasons. how much was the cost discipline a factor in why investors are just completely soured on this >> well, in terms of the last 25% move, i may be wrong, but i think it was 100% the factor when you look at what they printed in the september quarter results there was no issue with the users, with engagement and revenue results were weak. but right in line with

expectations in fact slightly better than it feared it all came down to the company's unwillingness two weeks ago to say that they're willing to tighten their belt, willing to slow down this expense growth and capex and expense growth that was the number one issue. further back there are other issues and the company has to address those, competition from tiktok, apple privacy threats, et cetera. the last 25% move all about costs. >> so you see this as kind of a game changer here? >> well, i think you'll see a recovery in the stock. i think they'll regain the 25% then we're going to have to go through the macro trends what's the market modeling, all assuming we should assume deterioration and ad revenue trends in the december quarter and march quarter and maybe start bottoming out in the june quarter. if that happens i think you'll start seeing a bid on the stock in the early part of next year we're waiting to see how the macro headwinds face between now and then and the valuation

stepback we're talking about an asset 12 times gap earnings with high margins, cash flow, buying back stock i think it's great value play in a tech growth sector not growing now but within 12 months it's going to be growing and growing sharply. >> mark mahaney, thank you for joining us reiterating the call. about 2 minutes to go in the trading day. looks like the dow is having the worst day, mike, since early october and first down day in four. >> it's pretty broad-based on the downside, sara yesterday was not too bad in terms of upside breath but today has been close to 90%. 2 year note yields worth monitoring but it is that raw nerve of the mark. the cpi will determine whether the market has the fed priced correctly. starting ta flatten out but a

longer term uptrend until it comes down, stocks can't get too much of a sustained advance going volatility index not doing a whole lot, hasn't gotten down below the 25 level perking up to 26, may be jeopardizing the downtrend we've had there. 2% days are not something that jars the market. we still are in a multimonth trading range even if it doesn't feel like it. >> as we head into the close every dow stock lower except merck. disney the biggest drag, unh taking 80 points off the news in the last ten minutes or so from the "wall street journal" that binance is walking away from the deal with ftx. bitcoin at a two-year low down more than 10% right now. we have the broader s&p also lower by 2% with every sector down energy hit the hardest consumer discretionary at the bottom down 3% tesla not helping down 7% and

more than 55% off its highs. nasdaq down 2.5% meta a rare exception. apple, amazon, nvidia, weighing on the nasdaq. that's it for me on "closing bell." see you tomorrow into overtime with scott wapner. >> thank you very much welcome, everybody, to a busy overtime you heard the bells. we are just getting started from post nine here at the new york stock exchange we have earnings about to drop as wynn and rivian set to report everything you need to know, we begin with our talk of the tape, that news, breaking in the last 15 minutes, binance walking away from its deal to buy ftx, stocks unsettled over the fallout of that developing story. josh brown is here from rit holt, the