i'm in nor tyler mathisen. nasdaq down as well investors concerned the fed's relentless rate hike campaign tipping our economy into recession this hour a look at the health of the consumer, recession protection and what a slowdown means for oil, tech and the trade. first a kelly and a check on the sell-off, welcome, hi, everybody. tech hit hardest under recession fears. we have the s&p down about 2.7% today but 3.4 nearly for that nasdaq selling picked up after a bad retail sales report this morning showing worst drop in 11 months. other poor data as well. tightening out of the european central bank add it up, it's landscape now. apple worst performing dow stocks, as a matter of fact. netflix down big on advertising concerns down almost 9% today more on that later alphabet, microsoft, google shares down 5% the bond market, yields falling on concerns over growth. ten year back below 3.5%

remember, 361 highs we saw after that cpi report but done a big about-face more with bob pisani at the new york stock exchange. >> well, the problem today, kelly, that the soft landing crowd is having a very tough time of it remember the narrative here. the stock market's lifted off its october low under the belief that, well, we may see an economic recession or slowdown next year. it's going to be a mild one. the fed will raise rates finish in early 2023 and then maybe consider lower rates in 2023, the end or early 2024 and the market and economy will hold up earnings not have a precipitous decline. that question mark exists, or a big question now, because the earnings situation may be more precarious than people think rate higher, soft landing harder to make. lousy information on retail sales, industry production maybe a harder landing

if we get a harder landing in the economy earnings coming down modestly not much and not accounting for a hard landing maybe 4%, 5% not a big number a valuation problem now, guys. the important thing now, what side of this recession debate are you on the harder landing side and today because of the economic news that's got a little more currency than the numbers have got to come down market's got to come down. valuations are too high. earnings estimates have to come down more. >> bob you, said the word "currency. what about the weaker dollar definitely, slowed down. tremendous hike over the year. only up 9% for the year actually down 6.5% q4 how does that shape what we're looking for rest of the year >> and ecb raising inflation forecast generally that's good news dollar down and rates down, particularly on the treasury rates moving to the down side.

the problem is very, very simple right now. the stock market is pricing in a somewhat of a very, very mild slowdown in the economy. and the evidence is starting to mount that that may not be correct. so, again, just keep going bouncing back and forth between what side of the equation you are. tell me where you believe the economy's going to be a year from now and a pretty good idea where earnings will be right now most of wall street has earnings down, flat to down about 5% a very modest earnings recession. but in a notable recession, earnings can drop 20% easily the market is not anywhere near anticipating that and the kind of economic news we got today indicates maybe we're on the harder than softer side. >> certainly something to watch, bob. ten-year rates at 3.44 bob pisani, new york stock exchange thank you. and turning to retail. s&p retail down 3% on today's disappointing retail sales report off 31% this year declines in the report broad

across most categories including furniture. autos and electronics, suggesting inflation is taking a toll on the u.s. consumer. here to discuss what this says about the consumer and health of the retail industry is ceo of storch advisers and former toys "r" us chairman and ceo. great to see you. >> my pleasure. >> you're about apparel and toys, merchandise in stores but i want to touch on one thing talking about the health of the u.s. consumer, but look at the auto report. down more nan 2% isn't that the one area we supposedly had a lot of pent-up demand what does it mean seeing alto sales decline by 2%? >> cars are expensive and often financed that requires -- interest rates have a huge impact on big-ticket items. absolutely no doubt it's hitting the consumer across the board. i look at this ort two numbers you need to know grocery up 8.6% year over year basis and department stores down 3%

need to eat versus look good spread over 11% to 12% difference in consumer trends. massive. consumers forced to spend money on necessities and don't have much left over. >> mentioning increased price of food seen on the cpi report and shelter costs went up. what's going on? i remember black friday, looked like sales would be strong, looked like a strong holiday season what's changed has the consumer lost spending power or confidence in ability to spend now with an uncertainty 2023 ahead >> hate to tell you, i was on yo show cyber monday and told you then justof hooli black friday wasn't good at all. record sales black friday and online sales show add 2% increase year over year, tragically bad 2% online sales, horribly off. it wasn't a good black friday

online or in the store certainly is not a good black friday or good holiday season. anyone sells goods that are not necessity. >> jerry, saw a november charge-off data, delinquencies last month across major card companies. a break in the trend if you call it that. peculiar to me several months real wage gains had been above inflation. so i don't know if that's going to bail us out here with a little lag, or not i mean, what's do you make of that >> consumers getting more and more leveraged and can't keep spending at the rate before. look backwards, can see we've lost a lot of our, or some of the government stimulus helping consumer along we know that credit card spending is increasing consumer leverage starting to grow absolutely no doubt we're seeing signs of a stretched consumer.

i love the american consumer, spend until runs out of money. seeing so many signs starting to run out of money basically spending money on food, gas, the other big number in this still up big year over year spending on gas. people doing one thing going out to eat increases in restaurant sales. depending on services not in these reports. no information about airlines or hotels or other traveler services keep in mind, a lot of that is price inflation for the same aline flight. >> quick, jerry. is it possible just pulled into october? an amazon effect >> no doubt some was pulled in october. racing to the first outender the theory didn't have to be faster than each other just faster than, faster than the bear just the fastest retailer pulled a lot of sales in october doesn't mean it's coming back. spent in october november down. i don't hear from anybody out there sales are breaking guns

now. ten days left to christmas almost, i don't have time to make it up retail is promoting wildly incredible promotion out there we're not talking about the impact on retailer margins sales might not just be soft but margin rates hit plus another, hate to say this, inventory hangover into next spring. >> leave it there. not your usual sunny self this time around. a lot of doom and gloom about the retail picture always appreciate the insight. if he's right look at ways to protect your portfolio as recession ricks grow and with us, fbb capital partners do you share his pessimism about the consumer >> a little. key issue, depends last guest talking about a lot of pressure in the retail space, pulled forward to october, november wasn't looking that good really depends what kind of retail sector you're looking at.

generally we prefer scale. like barriers to entry, and conference sending gaining share. a company like lowes make a housing bet, a lot of scale. came out with guidance next year baking in potential pressure ways to play retail without kind of getting burned on smaller caps jerry clear to say, look, talking about stuff you buy. maybe at a mall. we're not talking about services are people simply going back to spending as seen on those taylor swift concerts, maybe even airfare, vacations again is this just a mix >> seeing a lot of that. it's been sort of a big cycle between the stay at home period during covid a shift but depends what angle are you looking at it? some people say, well, i want services i want to have a good experience

for example, a good home situation. i'm going to do home improvements others say, go and have discretionary at retail, et cetera another athal, despite the shift towards services probably heading into recession generally people like to scale up, et cetera. ways to own that theme as well even if goods in general are under pressure something like a costco may benefit as people look to buy bulk even as that kind of mix for goods and services starts to shift. >> and i want to switch from retail for a second and get to another pick ticker, a conglomerate with insurance, investment business $80 billion market cap not a stock talked about often best known to our audience at the parent company of mercer and an asset manager with abouts 3ds 50 billion in assets under management this current environment, what makes a company like this so attractive to you? >> really, this is a bit of a

macro call and heading into possibly recession you want to have a pretty solid company in your corner. marsh mack, the big brokers, in good shape a lot of times when there's fear in the market, that's generally helpful for insurance demand they want to stock up on insurance. done pretty well looking into next year if there is some type of slowdown you are likely to see that again typically this company does well through a recession. a little bottom's up theme with reinsurance. likely a benefit there and a month of broke mahr max small companies they're better positioned. a good company, good part of the psych's. something to own for the defensive part of the portfolio.

>> bob pisani said market looks overvalued, top-down strategists see things where do you see that? what does it mean for stock prices now >> seeing additional pressure on h earnings jay powell squeezing the economy. investors worried seeing basically the ghost of christmas future like today retail sales under pressure what does that mean the next six to nine months filtering into earnings we see a bit more pressure. typically in a recession you see profits come down 10% 15shgs% maybe 10% still in early innings. adding to investors volatility getting into the spring i do think earnings will trickle down you may get a tipping point where earnings are down say 10% and investors say, okay. look over the hill earnings may go down more but start buying more of a track tickle opportunity looking into spring. >> mike, thanks for joining us

tough market optimism today a lot of people telling us, rough sailing. >> dow down 903. >> coming up, trade down on travel why a leading analyst says white collar job uncertainty could impact marriott's bottom line in the new year. plus tech taking another beating. netflix down 52% and uber down see biggest bounces in 2023. "power lunch," right back. i promise our relationship will be one of partnership and trust. i am a fiduciary, not just some of the time, but all of the time. charles schwab is proud to support the independent financial advisors who are passionately dedicated to helping people achieve their financial goals. visit findyourindependentadvisor.com

travel and leisure stocks hit on concessions today not just the retails sales report marriott, norwegian cruise and mgm relatively minor drops but still 2 to 3%. our next guest downgraded shares of marriott to equal weight. what is it white collar uncertainty great to see you you pick up on a dispersion between white collar and blue collar right now right? >> thanks for having me, kelly yeah look, i'm not a macroeconomist but we've seen this anecdotally a little a little while now. our own companies hiring at hotels or casinos are still not fully staffed from the pandemic. right? the idea they would go and cut people just to try to hire them back 6 to 12 months later for us doesn't feel like it's how this

macro will play out in '23 we see the tech layoffs accelerating we see white collar, or blue collar job postings gains share from white collar postings wee see blue collar wage growth outpacing white collar wage growth a little shift under the surface there. >> certainly points to a profits squeeze implying earnings going down because of what you're paying for labor force going up. same time end demand kind of falling off a bit. who else other than marriott is going to be feeling the squeeze here >> yeah. so for our call today we do focus on marriott, but i think it's going to be across the board. for high-end leisure travel. right? i think that there, it isn't going to fall off a cliff. travel and leisure will be a bright spot in '23 relative to other relative consumer discretionary segments but i think price sensitivity will

form at the high end look, the world is different than 12 months ago less pent-up demand for travel specifically there is just a, less confidence in the economy overall so we just think there's going to be a little trade-down. >> and frank here. i know there is a bearish call on marriott generally in the travel sector sdpp that factor in china seeing signs china could reopen and pent-up demand ebbed here in the united states and maybe in europe, certainly a lot there. people who have been stuck in their house and generally chinese travelers are high in consuming? >> thanks, frank yeah look, china, we are bullish on china's reopening in '23 a tailwind for all of our companies that are exposure to china. the exposure for china for marriott, let's say, less than 10% rooms. pretty stable across most of the companies we cover, and it

various, but fees, net fees to these companies are even below that number because they make a little less royalty fee in china than in the u.s. it's a tailwind but i think the u.s. is still the core business and the profit driver. that's sort of front and center. >> let's get a little more g granular >> moved to sidelines on marriott equal weight rating at our price targets trade at a pretty full valuation that's well above historical multiples. it outperformed its lower-end peers this year by 20 points that was because, we were, had a buy rating because the tailwinds into this year were a big you know, broad recovery of group travel, a broad recovery of high-end business travel, and the high-end leisure consumer holding up the thesis that played out going into next year, less group

recovery tailwind? right? group okay less tailwind. and business travel high end more sensitive to macro than the low end of business travel that's where marriott is positioned just seeing less tailwinds and slowing of growth as a sort of a base case with the full valuation. >> fascinating call. for what it's orth, people looking for a pick-up, wyndham overweight looking into next year thanks for joining us. appreciate it. netflix, one of the hottest stocks in the market up 60% over the past six months. today, falling 9% on concerns its new ad supported tier hasn't gotten off to a new start. mark mahaney makes his case coming up. heading to break, a look at other names in addition to netflix dragging on communication sectors. meta, alphabet and disney hit

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[finger-tapping] if your work, works for your community, then you're on team earth. welcome back to "power lunch. netflix falling by pe 9% stock

over the place this year 77% off lows and about 22% higher quarter to date, but still down about 50% since start of the year. hope you followed that. our next guest expects the rebound to continue into next year here to talk about netflix and other picks mark mahaney nice to see you. talking about it here. netflix up in q4 excitement at first but off to a slow start what's setting it up for a strong start in 2023 >> we do want, did turn tacktively constructive in 2023. multiples and estimates derisked costs on unprecedented level of rifts across the space creating a sling schott oshot all that said, seen it in

commerce and other checks. want to be tactical. find companies already taken out costs, have a new revenue stream, recession, somewhat recession revenue streams and companies with a new product cycle. that's netflix our top pick for the year. taken out qucalls earlier. cheap as you can get for entertainment going through recession. this advertise business is the real deal. off to a slow start but have you seen ads haven't seen them in the u.s., germany or the uk, three largest markets. doing in other markets i think we'll see more of it rolling out password sharing plans next year. so i city think it's the major catalyst, addressing rising price sensitivity at the company and they can do it in a way positive for unit economics. sticking with netflix. today's move doesn't 23phase me

>> stay with netflix a minute. big hit shows, "stranger things," "bridgerton." how about to keep keep people and watch to the end >> extremely important two most important reasons people turning off netflix in the past, used to be content then price actually became a bigger driver. i thought ad support initiative could be useful in terms of helping grow subs, but content is still king here with all streams companies. netflix's advantage, gone through accelerating competition in streaming in the last three years. overstate. that changed when disney fired its ceo generating excessive losses in disney+ streaming. entering streaming industry rationalization. i think that helps incumbent leading incumbent is netflix, suspendeds 17 billion a year on

con hits and need subscribers to support that netflix has that and scriber base will continue to grow, i think. content is king but i think netflix has the pml and the subscriber base to afford paying whatever king-like levels of content spend. >> markets, kelly, two other big picks jumped out one uber, tough year, and the other we don't talk a lot also down 50% uber and wicks people looking across the market wondering of a couple cheap stocks, why those? >> three screens i use names with recession resilience. i don't cover a defensive sector tech, much more discretionary especially consumer side even enterprise side slowdown there find something somewhat recession resilient. mobility is that still need to commute. still want the social rides, to and from restaurants, home,

movie, whatever on weekends. still have airport trips i don't think mobility, more utility than consumer discretionary item and uber has taken out air and mobility name hs to take those 20% to 30%. that bad, rifts way back in 2020 because of covid meaning going into next year cost bases are matching what could be a softness in revenue. then a couple interesting prop initiatives i've liked out of uber including up-front pricing. a huge boost for their drivers and a countercyclical edge to uber getting month are drivers coming on the network, they need the side hustle. uber a quick way to make an extra $30,s $40. continue to generate to uber more value investors will come in. >> and push back a little. a question about wicks and uber

replaced i feel like the economic slowdown possible recession is a double-edged swords. uber, and wicks start up a website not feeling satisfied in their job perhaps lose a job same time, doesn't that reduce demand because less people fly and less people do things on the websites that wicks already has its customers? >> frank, this is a cyclical sector really trying to find who's less cyclical a business that's got reasonably sticky demand? demand softens in recession and will soften all all of these businesses including surge and cloud. no question. people need a web presence during recession and may get a greater start-up community with all of dislocations seeing in tech jobs. i think demand may hold up reasonably well for something purely discretionary like apparel, fashion, and again with mobility the question will we still commute? still some travel?

still social outings and what's the alternative pay for an expensive taxi in new york, trieses have gone up there 25%. still safety concerns. you have with other modes of transportation so i think the demand for mobility at least for uber sticky at least through the recession more so than other areas. >> mark mahaney, appreciate insight. thanks for being here. >> thank you. over to steve kovach. >> what's happening at this hour georgia become the latest state to ban the use of tiktok on government phones and computers. governor brian contempt called tiktok a national security threat which could share user information why the chinese government pop more than a dozen states recently announced similar bans. and chemical and phrma giant bair paying $700 million to end a pcb pollution case in oregon originally brought against monsanto bayer owns.

largest recovery in history. boris becker released from jail from a 2.5 year sentence convicted hiding millions in assets declaring a bankruptcy. he's already returned to germany. >> i'm take it thank you. steve kovach. digging into all angles of the market sell-off. bonds trending lower sea of red today including in oil. right now it's around $75 a barrel up next we'll talk to the man who may have made the call of the year, predicting in february when prices were soaring that oil was on its way, all the way back down into the 60s what is he saying about crude now? you'll want tota sy tuned on "power lunch," right after this.

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welcome back, everybody. it's been relendless all day today. 90 minutes to go dow down 841 points. let's get caught up across the markets with bonds and commodities as well including looking back at perhaps what was the greatest call of the 2022. before all of that, though, start with stocks. down 950, lows today backed off of that a little by

about 100 points s&p still town 105, though, to 3889 and nasdaq down worst 3.9%. ecommerce hid hard talked about it earlier. wayfair, overstock, shopify, wayfair down fintech knocked around and visa, master card, paypal not a lot of places to hide firm down 7%. verizon only one higher. calling it attractive value up 1% today. bond market now, yields falling. not a lot to help the stock market a lot of recession fear es are everywhere. >> maybe the stock market would be down an extra one or two% we don't know the counter factual. we do know post-fed, two and three-year notes higher. fives and sevens eventually unchanged, 10s, 20s, 30s, yields

lower. i don't know jay powell would have suspected that type of arrangement. look at week to date of two-year note yields. higher on the session but lower on the week. week to date of ten-year yields consider this. they trade below 3.41% and close that will be a new low for the week and actually it would be a three-month low yield close should they do that. look at boom deems completely different picture. a week to date of booms up, up up and away closing a whisper under 210 at a one-month high yield. means if you look at relationship between the two, it's gotten closer together. as a matter of fact, there's only 136 basis points that separate our yields in tens from yields and booms meaning closest together in 26 months. look at fed fund futures everybody's saying, hey, lower on the session look at the june, june is the

folk crum and they're right. lower means more fed but still higher on the week, which means the pushback in treasuries by investors trading them is still probably bugging this federal reserve. kelly, back to you. >> sure it is. thank you very much, rick santelli. oil closing for the day. dropping about a percent and now barely higher for the year on those global downturns fears let's get more on what was kun of the biggest market surprises this year, in fact, as wti crude is around $76 a barrel today yes, earlier back in february, before that big price spike, most in the market believed the price of oil headed relentlessly higher perhaps over 100, even $150 a barrel not to the downside. exactly what we've seen play out. this is not a surprise to at least one analyst. citi's ed morris said when asked in early february why he thought prices would end the year lower. listen.

>> heard 120, 150. my next guest sees prices falling. with us citi's global head of commodities research ed morris how low could prices go, ed? >> bottom, what the top is figuring about a mid-$60 for brent. lower $60 for wti end of year. based on numbers looked at and wild cards to change it one way or the another mostly to the down side. >> let's call him mostly, probably right ed morris joins us now citi's global head of commodities research good to have you looks like a lot of reasons cited. excess inventories is the dynamic takes place in the market today what happened? >> what happened, we had a price spike really, a result of the initial reaction to russia's invasion of ukraine, and europe and others deciding to get off of russian crude and a scramble

to find alternatives so there was a bidding up of brent and other related cruise a crude and yet the market turned out what what it's turned out to be now in a very different situation. not expecting last march the world would face recession look at 2023 versus now, looking at demand growth that's really on the very low side we're looking at demand much lower than most other people thinking demand about the growth of 1.3 million barrel as day 1% basically where we're looking at china right now, which could have growth, but its demand at this moment about 1 million barrels lower than a year ago. europe enters recession. demand lowering. lower than a year ago with nowhere to go. the u.s. is seeing no year on year growth in demand whatsoever with a recession lying ahead three big economies that are not seeing significantly robust growth with the only hope for it

being china of the big three as it may or may not come out of a slowdown. >> ed, is it fair to say more bearish now? >> we are bearish, but a new factor in the market that's the u.s. acting as a floor price agent. we've heard that the white house is very public about saying there's a price at which we're going to start buying spr oilthat price seems to be wti hitting $70 a barrel got to take it as a message to believe. particularly as china, also, starts buying prices as well and we know opec-pressed countries want to see the floor on prices pup a lot of dynamics in the market for buying crude, moving back to stock released in abundance this past year to bring the price tag and succeeded in doing that. >> frank holland here. you mentioned china a second ago. when you made the call, hard to

believe you knew that the zero covid policy in china would extend this long i don't think anybody knew that. also factors china will reopen seeing signs and reports and chinese people will not only get out of their house, travel around their country and to other countries as well? >> absolutely. in our low case for demand around the world, half come from china believe it or not. a complicated story in china the big growth of new oil demand is going to be clearly on the aviation side. we're seeing international flights already starting to grow at an incredibly rapid rate. there's another hidden thing we don't much think about and that is what it did last year last september when they started having fwlblackouts stopped exporting petroleum products and they started slamming that down. they were exporting last summer, a year ago, in summer of '21

around 1 million, 200,000 barrels of day petroleum product and stopped doing it altogether last september and now opening up again so, yes. we expect chinese demand to actually grow, but we expect chinese exports to grow as well, and we think they'll be back up to that 1.2 million a day level by the time we get to q1. >> final question, ed, for investors looking into 2023 and wondering if energy stocks are the place to be. would you caution them away from that or do you think they can still perform well in the price environment that you anticipate? >> yeah. sorry to disappoint you, but regulation not allowed to talk about equities we think oil prices will be volatile and moving to the down side may have a strong q1, because at the time other than that, and the russian issues that are uncertainty, we think there's going to be inventory guild upagain through the year the only things stopping slide into the 60s is u.s. purchasing

of sfpr oil along with healthy chinese and indian purchasing surfe suris a fesuffice as well. >> thanks for being with us. coming up next, nasdaqow dn, chip stocks hit harder details next on "power lunch." >> announcer: the bond report is brought to you by --

snee. welcome back to "power lunch. bring in kristina partsinevelos. >> and recession concerns and pressure in stocks those like technology nasdaq almost below 50-day moving average, a key technical threshold. nasdaq 100 already lost over $5 trillion just this year alone and today continues to fall well oesh herb 30% -- 3% 30% year to date big gap cap tech having biggest impact names like apple,

microsoft, nvidia, over 3% today and others only one nas 100 in the green. up over 3% today one report i saw a line popping on positive comments regarding its chinese business things maybe doing well there. and weaker than expected november retail sales ecommerce hit hard look at wayfair down almost 10% lower. overstock over 7% lower. etsy 3s% and names kla, asml don over 4%. not only demand weakness, uncertainties with china and what that means for exposure going forward. investors concerned about this going forward. >> right cyclical or a similar political issue. know both. what's the latest on the chine ma front >> a cold war, chip war, whatever you call it

the fact the unite imposed restrictions in early october. now added 30 names to the entity list, which means companies will have to get more licences to do business with certain chinese tech firms specifically related to more advanced technology. so that china won't advance any artificial intelligence. military applications, china retaliated filing a complaint with the wto, and second thing they did, just reuters roiting 143 billion dollars incentives for chinese semiconductor space could be implemented next year to possibly change things helping china maybe come forward in mature note seconds, not blocked right now. if that's the case, keep developing that could lower prices and hurt competition here in the united states all of these factors to consider. >> absolutely. maybe at the worst possible time for investors already nervous about it kristina partsinevelos. and big drop in retail sales

leading to today's big sell-off on wall street. up next, looking for opportunity and which stocks can you be best positioned heading to break, look at some consumer names selling off on macro fears. etsy, ebay, target, even c chipotle off.

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welcome back to "power lunch" with the market selling off we're focussing our three stock lunch on recession resistant names. bank of america calling meta platforms a best positioned large cap name if a recession happy. war by parker saying the market is recession proof and delta, a top pick for 2023 saying the airline should return to profitability even in an economic downturn. here to trade them is courtney garcia, great to have you here let's start with meta. >> thanks for having me. meta, i would not agree this is a recession proof stock. about 98% of revenue is generated from advertising revenue that's one of the first things to go if a recession happens. as a longer term investor what i

like is it's gotten to a reasonable valuation i would have this as a hold. i think it has some near term issues when it comes to advertising spending but long-term i think it holds a place in your portfolio. >> also, a lot of small business exposure do you think that's one of the first areas we'll see the ad spending slow down >> very possibly i do think that's -- the question is is a recession going to happen, if you're the mindset, we're going to see, that's going to be an issue. >> if you think recession is going to happen, there are some saying warby parker is recession proof. you buy it >> this one i have a hard time with i have it as a sell here a couple reasons we are in the interest higher rate environment and where profitability is going to become important as well as valuation warby parker is unprofitable currently. they're trading 30 times year over year revenue at their i.p.o., at their recent quarter reporting only able 8% year over

year, slowing growth unprofitable, i think they could be at risk from people trading down from warby parker to a lens crafters >> are people going to trade down from delta to something else >> delta i have a buy. i'm optimistic on delta. airlines in general i don't think the demand you've had from covid is ending any time soon, especially with business and international travel which delta has a lot of sources there one of the things that's a drag on their earnings is the fact that fuel prices are so high weer seeing that come down and over the next several years they're going to upgrade their fleets to more fuel efficient aircrafts. this has a lot of trajectory to go and trades cheaply at eight times guarforward earnings. >> do you think it's okay to be invested in the market

>> absolutely. but you want to be strategic where you're invested. make sure you're well diversed, only adding things likely to do well in a recession or higher interest rate environment. >> thank you, we appreciate it. up next the bright spot in one of the most hard hitec stors of the year. what is it can you guess? more "power lunch" right after this power e*trade's award-winning trading app makes trading easier. with its customizable options chain, easy-to-use tools, and paper 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 okay there are some bright spots in the market, one in real estate one of the hardest hit sectors of the year. let's get to diana with more >> you can thank fast falling mortgage rates for all of this the builders are reacting to the deep dive in the yield on the 10 year treasury. freddy mack released its weekly report showing a small drop last week but rates have dropped more look at mortgage news daily which posted a 14 basis points drop just this morning to 6.13% on the 30 year fixed the rate last peaked october 20th at 7.37%. so that's a big move in a short period of time look at the home building etf, the builders were down in the premarket due to the earnings release yesterday. a wider than expected drop on new orders and missed on earnings in a conference call this

morning, stuart miller harped on the lack of supply in the market and said the short fall leads the industry in what we believe will be a short duration correction, saying linar is not fire saling its hope despite reports it was back selling. >> what do we make of this, do we call it a counter trend move? green shoot for housing? the stocks have been leading the market. >> go with either one of those we heard the ceo of toll brothers last week calling it a potential green shoot he didn't want to say it was a market turn the way he did in august he did expect some green shoots but remember we're in december which is the worst time for home sales. nobody buys or sells a home for christmas. so we probably have to wait and see what happens in january but this trajectory is going lower if it stays lower or moves below

6% that could be strong for housing. >> bizarre to think if mortgage rates go below 6%, wow would have seemed crazy a couple years ago. thank you very much. frank thank you as well. >> always great to be here with you. >> thanks for watching "power lunch," everybody. >> "closing bell" starts right now. a fed hangover and down beat data sending the market tumbling today though we are off the worst levels of the day, the dow is down almost 1,000 points at the low. this is a make or break hour for your money welcome to "closing bell," i'm sara eisen look at where we stand in the market the dow, only one stock higher today, which shows you the breath of the selling. verizon is the outlier everybody else is down goldman sachs, united health care, microsoft taking the most off the dow. s&p 500 down 2.3%, every sector lower