there with those stocks and those who think the worst is to come thank you. and thanks everybody for tuning in that does it for the exchange today. ahead on "power lunch," three big names are about tareport next week and we'll get the trade on nike, fedex, and micron "power lunch" starts right now >> welcome to "power lunch." i'm jon fortt in for tyler mathisen here's what's ahead. breakdown or breakout. the nasdaq hit hard this week, but do the charts signal a bottom is near when you look at the technicals to find out which two tech stocks are about to bounce >> plus, storied wall street bank goldman sachs reportedly has plans to shed 8%, up to 8% of its work force. are there more layoffs to come those stories and more in the hour ahead first, to kelly with a check on the market >> thank you, jon. welcome. hi, everybody. stocks getting slammed once again. the dow's three-day losses totaling more than 1300 points

we're down 548 at the lows, about a 1.5% drop across the board here 3833 is your level for the s&p 500. big options day as well meta is the best performing stock on the s&p after an upgrade at jpmorgan to overweight they're talking about easing cost pressures the stock eking out a gain for december meantime, the energy department will begin repurchasing crude for the spr, the first purchase since that record 180 million barrel release from the stockpile, with crude prices around $74 and change, now seems an opportunistic time to replenish it >> on wall street, the soft landing crowd is on the defensive, as calls for a recession, a hard landing recession grow our next guest says a recession is likely and that could shift stocks into neutral. let's bring in mark, the chief investment strategist at janney, montgomery, scott. why, first of all, are you

convinced that a recession, perhaps a harder landing, is in the cards? >> well, jon, first of all, if we do encounter one, it's more likely to be mild and relatively brief than even a typical fed induces recession which would be much more severe in nature and likely protracted. having said that, it seems by all accounts, particularly re-enforced by this morning's pmi readings for manufacturing and services, that are not only below 50, which is the line of demarcation between expansion and contraction, indicating contraction, but then secondly, dipping even further into levels that historically have been indicative of a recession or a recessionary like conditions in addition to that, the leading indicators, the yield curve being inverted, these are very prescient indicators that signal the prospects of a recession, some varies, but 7 to 12 months hence, which would put one likely some time in the middle

or second half of next year. for us, we remain generally cautious about exwitties in the near term, because of the discount applied to the stock market, perhaps a lot of that risk has already been pulled forward. at the same time, we may have to plum more lower levels before durable bottom is formed >> what's an investor to do if stocks are going to be stuck for a while? raise cash, hold tight >> jon, i think hold tight i think it's very difficult to raise cash because obviously the timing of that decision requires two correct decisions, when to get out and when to get back in again. the failure tends to come in the second one, when to get back in, because cash is incredible magnetic quality even though today it is yielding something that doesn't require a magnifying glass to see what interest you're earning on it. we have seen a pretty severe discount already applied to stocks the october low, we were down 27 pest, which is a typical drawdown if we avert a recession

in a bear market so i still think there is perhaps low odds, but some chance we avert a recession. if so, we have already perhaps seen the worst if not, we may have to go lower yet. at the same time, i think the prospects over the second half of the year into 2024 brighten enough to suggest investors should perhaps stay cautious in terms of their positioning sectoraly or with regard to companies of high quality nature or pay high dividends as a way to weather the tumult we might encounter between now and when things begin to brighten >> our guest last hour wer sticking investors with utilities, talk about defensive, also some health care, and you have united health as one of your picks service now as well. why these two stocks, why service now? >> kelly, service now, obviously a technology company in a space that we like, we think has very strong secular tailwinds in terms of software service as a

cloud i.t. management company. been beaten up like the rest of the tech sector, down about 40% on a year to date basis. not necessarily cheap on a pure pe basis, but relative to its 30% plus growth rate that it's been operating at and projected to continue to, looks more reasonably valued than in quite some time, and again, because of the thesis of business spending that disproportionately is directed toward software services and companies that have a subscription tend to do better because they have more persistent, more predictable results. >> is there a lesson from earnings like those of adobe which have that stock up 3% right now today despite the market being down, and even those like mongodb, the types of stocks some people were saying stay away from because they don't have profits yept, but they continue to grow, and faster than some expected. >> jon, that's obviously for investors who can, i think, have

the risk budget for those kind of speculative investments you're making an adjustment on price to hope ratios in this environment in which we think the economy is more likely moving toward contraction than reacceleration, which under a reacceleration scenario, perhaps you can price things to work out perfectly and they'll bail you out, but if that's not the case, which again, is central to our view, then we suspect those companies will continue to be challenged, and while perhaps tradeable for the most nimble investors, aren't prudent for most longer term or conservative investors. >> all right we're warned mark, thank you. >> thanks. now, the nasdaq is extending its losses today after closing below its 50-day moving average for the first time since early november what are the charts saying about the latest round of market weakness let's ask craig johnson, whois piper sandler's chief market technician i'm almost afraid to ask, craig, what do you see? >> not a very constructive setup

on the qqq chart we brought in here today we have been in a downward trendal channel for the better part of the year a decline in the 52-day moving average. when you look at the chart, we just can't seem to reverse the down trend we have seen the dow, which is my mother's favorite index, has already reversed the down trend, and we're setting ourselves up to come back and retest 259, but i have to tell you, even with the qqq's week, it doesn't mean the rest of the market can't work >> but how often do we really see that big of a difference between the nasdaq, say, and the dow and s&p? >> if we remember what happened post the dotcom bubble in the 2000 period of time, there was a long period over two years where people were talking about the market x that technology sector, and i suspect we're probably entering a phase like that again. this is going to be sort of x the faang stocks because if you look at amazon, you look at netflix, you look at even tesla,

if you want to add that into the faang plus type scenario, all those charts still continue to be trending lower in here, but when you look at what's worked coming off those october lows, the dow is up over 15%, 16% coming off the lows, and yet you can see the nasdaq was left far behind along with the faang stocks >> some individual stocks. looking at flex, that chart. what do you see? >> this is a great defensive play inside the technology sector it's been a big consolidating stock for the better part of a couple years and it's finally broken out above the consolidation range, backabove its 52-day moving average. these are the stocks inside the tech sector right now, defensive tech names that we think will continue to work for a while and it's one we would be buying. i would also mention, this was a great play, nancy at our firm has been talking about the reshoring theme. clearly, flex is going to be a play on that >> do you buy now, though? i mean, there's talk about a santa claus rally, and perhaps even though it might not feel like it today, there's been one.

we're just hearing about dark clouds perhaps on the horizon for the beginning of 2023. do you really need to buy -- even with the charts, if you look at broadcom, something like that, are the charts telling you now is the time to buy >> i think now is the time to selectively be adding to some of these positions. i think flex and avgl, broadcom, fit into that category, too. a nice down trend reversal a lot of what you have going on plays into the segment you were discussing about options and the expiration happening today you have $4.2 trillion of cash sitting on the sidelines, and you have seen over $90 billion go into money market funds over the last month there's a lot of investors out there who have swooped to the sidelines and any down turn reversal in the s&p 500 is going to drag some of that money back into the market. and yeah, i do hear the bells and i do think we're going to have a santa claus rally into year end >> okay, we'll see how high

those reindeer can fly craig, thank you coming up, the fed's fight with the market. is the central bank losing control, and what could that mean for rates and for stocks? >> plus, sunteen adjusting the 2024 forecast slightly below estimates. we'll ask the ceo about her strategy to improve earnings and improve care and bring down medical costs. she joins us in her first tv interview since taking the helm. a look at tesla, down another 4%, off 15% this week. wow. stock trading at its lowest level ncnomb 20.sie veer02 we'll be right back.

. welcome back the fed clearly tells the market it's planning to do more to fight inflation, and while stocks have sold off, bond yields have not reacted the way you might think. steve liesman joins us to explain what this means for the fed. no respect, steve. >> yeah, and right on cue with that outlook, san francisco fed president mary daly is out with a uniformly hawkish outlook. she said the fed once it reaches its peak rate may hold there for 11 months and everyone think it's going to be on hold for all of 2023. she aligned herself with the median outlook for the funds rate at 5.13%. compare that with how the market is prices for a peak rate of 4.85 right now and a year end rate that has a 50 basis point

cut built into it. treasury rates are flat, but this 4.36 compared with the 5.15 or 5.13 right now. it's a major way to steer the economy and bring down inflation. falling stock prices are a piece of it, interest rates are a more important piece and they're not helping the fed. the result is the goldman sachs financial commission has eased since november while the fed that supports economic growth, not less economic growth, raises the question whether the fed is losing its ability to control interest rates and what it may have to do to get it back. they're likely to raise by a quarter point in the february meeting but all agreed 50 is possible for february or later if the fed dudoes not get the response it needs on financial conditions from the markets. >> and we have really dug into this, steve, but the only thing that you wonder about is whether the fed itself is so lagging that they're the last person we want to look to for leading

information. in other words, i think i read last december, at writ large as a group expected two rate hikes for all of 2022 or something we're obviously way past that point. so whatever they're expecting for 2023, does it even matter or are the facts going to change so much between now and then? >> well, if you're asking me are they going to be right i think there's an even chance they're wrong. if you ask me if it matters what they think, i would say there's a 100% chance you ought to be paying attention to what they say, and it is, like i say, a forecast has nothing to do with the actual future. it is 100% accurate to what people think right now about the future if you ask the average fed folk, they think it's 5.13% for 2023, 17 of 19 above 5%, 7 of them above 5.40%. >> our next guest says the fed's objectives and gomes are out of

sync with reality. let's bring in ron insana. ron, what say ye, what's going to play out here >> i don't think the financial markets are acting any differently than in any other cycle in the past where of course they lead the federal reserve. interest rates are falling, the yield curve is inverted because the financial markets particularly the bond market believes the fed is overdoing it and driving us into recession, and the worry has shifted from inflation, which is clearly over the last five months in a downshifting mode, and we have seen that in commodity prices, lumber at 380, unleaded guess at 211. the market is discounting a future where growth is weaker, not where inflation is higher. i think the fed obviously is jawboning its position to make sure that financial conditions stay relatively tight. but in my estimation, and steve may disagree with me, i think the fed has this almost entirely

wrong at this jungture >> because you see a much softer economy? let's put it this way, ifyou think the labor market is going to crack on its own and doesn't need a further push from the fed? >> there's some weird things obviously, kelly, going on in the labor markets as we're short 4 million people whether or not companies lay folks off en masse remains to be seen given there are 4 million more jobs than there are available unemployed workers in the united states. that's somewhat anomalous. but i think as in prior cycles, the fed typically breaks something, and the markets discount that well in advance. and so if you look and analyze the last five months of inflation data, we're running at about a 2.4% rate. i think they have already achieved their objective whether they know it or not. i'll believe the markets cumulatively and their message over any individual forecast even from the fed. >> ron, you ignorant -- never mind friday, it's a long day. a long week with the fed meeting. i'm a little punchy.

ron, i don't disagree with what you're saying and i'm not going to be in a position in standing 180 degrees from the market's outlook. nobody has a lock on predicting the future, not the market, certainly not the fed. what i would point out is missing from your analysis though is this idea of wages and labor. the fed has this problem where it has not a cyclical problem of wages and labor but a secular problem. it has too much demand for not enough labor and if you look back at the speech where powell laid out what he thinks is happening with the labor market he pointed out retirement is still going on at an alaccelerad pace we lost more people than you think from the labor market from covid. that's three areas and he looks down the road, doesn't see that changes. sees an engngrained problem of

lack of labor in to housing which is 55% of the core and he sees that continuing to go up. he does not see a way to stop and reverse himself until he gets wages under control >> this is, steve, neither of us and i could include jon in this as well, can tear our hair out over this point, but if you have a structural shortage of labor, higher interest rates won't solve it if you raise the unemployment rate so people who currently have jobs that are paying and seeing increases above the inflation rate, the spiral has stopped. and all you're asking them to do is give up their jobs, go home, and come back to the same job 12, 18 months from now at a lower rate of pay. that makes absolutely no sense to me when the problem has nothing to do with interest rates. it has everything to do with what you and jay powell have described is a structural shortage of labor, immigration, birth raettes, and the like. >> steve, what does capitulation

h hypothetically look like for the fed. i can't imagine them doing exactly what the market thinks they're going to do, but guz it mean they pause sooner next year, instead of raising and then cutting >> yeah, first of all, let me give you the risk scenario i think it's much riskier if the market is wrong because if the market is wrong, the level of adjustment needed i think for bonds and stocks for a real funds rate of 5.12% or higher is pretty still dramatic, i think, from this point in time. it's much better if powell and the fed end up being wrong, have to turn down i think there's a hit to the fed's credibility, and this is really a conundrum for powell. because everybody i talk to says, if the fed does not get the response in the bond market that it needs to tighten conditions, its only recourse is to tighten more. that creates this problem. really what they want to do is slow down and go to quarters here and try to feel their way as to where that right moment

is but i think you have to pay attention to bond markets and that gs financial conditions index i showed you earlier if that doesn't tighten, i think powell has a problem if he doesn't get growth down substantially below potential. >> i just see they have already overtightened and already done it they have tightened financial conditions real estate, residential real estate has crashed, lumber prices have crashed, gasoline prices have crashed, retail sales are down >> you want to stop, ron, at 6% year over year inflation >> steve, first, year over year, i mean, i want to extrapolate the last five months, whether you look at core, cpi headline, pce, all of those inflation readings peaked in june or earlier and have fallen precipitously since. we'rerunning at -- >> housing was still going up. >> it's going down now, rents are going down really fast, more than most people had anticipated, including the fed

i don't know what else they have to do, and housing is like labor. we have a physical shortage of housing. we don't have a problem with respect to demand at the moment being so overwhelming for housing that we're short full supply we're short somewhere between 4 and 6 million units. >> i know we have to go, but it feels like that has to crack to really get us down to 2% >> i guess kelly, i heard you mention this and something i referred to the other day. if wages are rising above inflation, which is falling, that's not a wage price spiral that's wages being above had inflation rate which is reasonably healthy for the economy. >> as long as it stays that way. we'll end it there >> every little thing is going to be all right. you don't have hair, but you can do it. >> this is the argument for 2023 ron insana, steve liesman, always a pleasure. thank you both very much >> i for one hope to keep working in 2023. another down day on wall street.

s&p 500 down more than 1.5%, and down about 20% so far this year. given those numbers, a stock down only 2% doesn't seem so bad. take a look. centene seeing higher earnings, planning to spend $2 billion on a buyback plan the ceo joins us coming up on "power lunch."

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welcome back let's get to kate rooney for the cnbc news update >> hi, there here's what's happening at this hour alex murdaugh, the disgraced lawyer accused of killing his wife and son has been charged with tax evasion prosecutors say he dodged nearly $500,000 in state taxes on $14 million he earned and another $7 million he stole from his law firm with the nine counts of tax evasion, he now faces more than 100 charges, including murder and fraud. >> in berlin, rescuers managed to save about 30 fish from the massive aquarium that burst this morning. the 80 foot high tank held 1500 fish and 260,000 gallons of water before it ruptured officials are still investigating the cause, but there is speculation that

subfreezing temperatures may have cracked the aquarium's acrylic walls. >> and in chile, smoke from wildfires has triggered a public health alert for the 6 million residents of the capital santiago is also suffering from a heat wave that brought temperatures near the highest level ever reported in the city. fires have already burned more than 17,000 acres. >> wow, kate, thank you very much >> ahead on "power lunch," we're talking to the key ceo of centene, seeing higher earnings but lower revenue next year. we'll ask sarah london about that and check out shares of moderna which is now the worst performing stock in the s&p today down 7%, but still the best performer on the week after that positive news on the nccaer vaccines "power lunch" is back in a moment

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welcome back to "power lunch. a volatile week closing on a down note. let's head to bob pisani for a look at the latest market numbers. bob. >> we're down about 2.5% for the week at the lows for the day in fact for the lows for the week, a very rough three days. not a lot of new lows but some notable ones i want to show you some things credit cards have had a tough

week capital one at a new 52-week low yesterday. discover was down, amex is weighing on the dow this week, probably down 5%, 5.5% for the week not a lot of new lows elsewhere, but some of the financials, some of the big large regional banks have been terrible performers since the goldman sachs conference a week or so ago, that's a new low for comerica, m & t bank, they dropped dramatically after presenting at that elsewhere in tech land, salesforce is also a 52-week low, near a two-year low in fact i have been talking about the reits. a lot of concerns about the office reits and to a lesser extent about some of the regional mall reits. so sl green, that's a new low. that's the lowest in many years for sl green those are mall properties. they're down about 30% for the year so where are we? i think it's notal here, we're close to down 20% again for the

year on the s&p 500. we're probably about half a percent away from that, and that's pretty significant. only eight times since 1926 we have been down more than 20% on the year so you avoid that, that's obviously a little bit of a point to be wary of at this point. another half a percent or so back to you. >> well below that key 3900 level on the s&p art cashin warned about this week >> centene moving in and out of positive territory after the company increased the share buyback operation by $2 billion, issued new guidance at its investor day ceo sarah london joins us exclusively in her first appearance since taking over the top job. she's talking with bertha coombs >> hey, jon. thanks very much and sarah, thank you so much for joining us you just had your first analyst day since taking the ceo job in march. you were lowering your revenue guidance and part of the reason

for that is the public health emergency, possibly causing tremendous disruption in the medicaid market. >> yeah, first of all, thanks for having me. we were pleased to deliver guidance today that was in line with expectations from an earnings standpoint, but we lowered our revenue guidance mostly because of the phe and the impact of redetermination of medicaid centene covers more than 15 million medicaid recipients so we have been watching the phe and redetermination factors closely for more than nine months and working really closely with our state partners because we realize whenever that does start, there will be a number of medicaid recipients who will probably fall off the rolls. and one of the things that's unique about centene is we take a very local approach in each of our 30 markets that means we're able to partner closely with our state agencies and the medicaid agencies to actually figure out a collaborative process to make it as efficient and seamless as possible for members go through that process and then for those who are no

longer eligible for medicaid because we're the number one marketplace carrier, we can actually offer them an affordable alternative >> so hopefully there is some kind of smooth transition. >> that's the goal >> as states begin to look and lift that pause on people being kicked off the medicaid rolls. you talked about sort of the local approach that is part of your focus as you look to bring the company forward. for so long, we have known centene as a company that is very inquisitive, bringing in carriers in different states to get a wider footprint but now you're trying to integrate them and all use data driven st strategies to do that. >> interestingly, for as much as we have been inquisitive, the local approach has been a pillar of centene strategy from the very beginning in each one of our health plans we're embedded in the market we have team members who live and work in the communities.

and that gives us access to a kind of data that in addition to traditional health insurance data around medical utilization and clinical care, you actually can understand the factors in the community because 80% of health outcomes are driven by what happens outside of the doctor's office, and happens in the community, so we understand what are the resources we can activate when we think about the whole health of the individual and think about transforming the health of the community, that ultimately has better health outcomes long term, so that's really been our focus and we're amplifying that and investing in that as we go forward. >> kelly evans has a question for you. >> thank you hi, sarah. thanks for joining us. i know this is your first tv interview. my question is, can you give us an update on the health generally speaking of your population we're coming out of covid. we had a lot of horrible now flu, awful viruses, awful colds going around, and much higher mortality than is normal for the

u.s. what are you seeing, and what do you expect going into next year? do things look like they're on an improving trend or are we still facing tough times >> yeah, so we -- i was looking at the data this morning we're starting to see a little bit of the probably expected uptick in covid as we come into december nothing really alarming, but i think we all expected this just because everyone is seeing one another for the holidays and we're indoors. but interestingly, the acuity of the cases and the overall cost of the cases continues to go down which is consistent with the trend that we have seen over the last three to four spikes. from a flu and rsv standpoint, we are seeing an earlier spike in the flu season, which is actually very consistent with what we saw in australia's flu season it peaked very early it peaked high, but it peaked high on a relative basis it looked a lot more like 2019, which is what we're seeing nationally as well so the expectation is that we'll peak back to pre-pandemic

levels so it feels like it's a big deal, but in some ways it's because we haven't seen a lot of flu in the last two years. >> i wanted to end on you talking about local and working with people who are in the community. you told several stories on the analyst day about people in the community who really understand the experience of the people they're servicing and one of those communities is uvalde, texas, where you guys have been very much involved since the horrible school shooting there >> yeah, so superior health plan which is our texas health plan, has been in uvalde and serving the uvalde community for almost 20 years and so when we heard about the tragedy, we knew we needed to get involved in fundamentally a different way, so we have been down in uvalde for the last six months working really closely with community officials and talking about how we can help invest in the long-term health of that community, understanding

that the impact of the tragedy is going to last for decades and so we recently announced a $7.9 million investment to build out an expanded community center that will take the health clinic that's there and expand its services to include behavioral and mental health capabilities, youth development and counseling services and additional services again to really address the whole health of the community in addition to health care. and that's really a perfect example of how centene believes in partnering long term with our communities. >> we're going to leave it there. thank you so much for joining us >> thank you >> and kelly back to you. >> sarah london and bertha coombs, thank you very much. health care overall, by the way, having an outperforming year >> still ahead, banker blues goldman sachs adding to the list of wall street firms trimming staff. we have all the details and what it could be telling us about what happens next.

>> plus, fedex's tough talk about the economy in november. that sent the stock sinking. we'll trade thename ahead of its nextepwhh rort icis next week "power lunch" is back in two at fidelity, your dedicated advisor will work with you on a comprehensive wealth plan across your full financial picture. a plan with tax-smart investing strategies designed to help you keep more of what you earn. this is the planning effect. lily! welcome to our third bark-ery. oh, i can tell business is going through the “woof”. but seriously we need a reliable way to help keep everyone connected from wherever we go. well at at&t we'll help you find the right wireless plan for you. so, you can stay connected to all your drivers and stores on america's most reliable 5g network. that sounds just paw-fect. terrier-iffic i labra-dore you round of a-paws at&t 5g is fast, reliable and secure for your business.

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goldman sachs planning to cut jobs starting in january, up to 8% of the workforce cnbc.com reporting on that story, joining us now. hugh, given how much it grew over the past couple years and how in demand talent was, what does this mean >> it's a couple things. first of all, the bull market for talent on wall street is over, so if you have been at home and sort of playing it out, waiting to see, and resisting your manager's calls to get back to the office, that is over. that's over very soon. and a couple things. first of all, comp has been up pretty strongly. last year was such a strong year the boom obviously has turned into a bust. when that happens people have to be a lot more humble and open minded about what comp is this year except for the people who will get bageled. there are hundreds of people at goldman, thousands of people on wall street who are going to get

zero bonuses this year if that's a case, that's a message from management to say look elsewhere >> what changed? we know the environment for equity performance has been pretty woeful, bond performance has been woeful. has deal making helped that? talk us through why that's happening. >> you hit on the highlights the deal pipeline is down 40%. not as bad as equity capital markets which is down closer to 80% or 90% ipo markets are completely frozen when is it going to open up? do you know? i don't. there was a strain, and i went on with you in june and talked about what we felt was going to happen it came to pass. so the lack of activity in capital markets has sustained. we don't know when that's going to come back if you're david solomon and sitting at your desk on 200 west and saying when is it going to come back? do we maintain the capacity, hold on to our people, or do we just cut bait, close up now, and if we have to, hire again? this gets back to hire and fire,

the cycle on wall street >> where are we in this weather pattern? a few weeks ago, you broke the news about wells fargo and the mortgage business and layoffs there. now we have gotten goldman sachs coming up in january, 8% is a significant number is this rolling through? is there another shoe we should expect to see drop in february and march? >> i did cn't think there was, d now i have changed my mind morgan stanley, i think they're done i uspect they're done for the cycle, at least for a mew months folks like goldman sachs are much more highly levered to the capital markets businesses they're retrenching there. that sort of failed. if you're really levered to the boom and bust capital markets businesses, can you maintain your troops on the ground? i think for a lot of folks this is a sign that there will be potentially rolling cuts between now and through the first half of '23 >> it's pretty significant when we talk about goldman's marcus

furay having failed. and if that's true and that strategy of build a consumer business from within to rival the steadiness of a morgan stanley now has. if that didn't work, what does it do now? does it invest in something further in a time like this where it's otherwise retrenching, and if not, is it going to come back to haunt them >> the people at goldman sachs who never agreed with this venture into consumer, they won. and it leaves david solomon with the same pickle. he's leading a company that is overlevered, 60% capital markets trading or investment banking. those dozant merit a great return because they're up and down how do you diversify it seems like they're going to get further into wealth management it's not easy. if you want to buy your way into wealth management, it's high multiples. he's stuck in a position he was when he took over as ceo he's in charge of the best brand

in investment banking and trading, arguably, but overlevered to investment banking and trading. >> the danger in being an apple supplier you don't necessarily get apple's results even if you're supplying financial services as goldman sachs was. keep breaking the news hugh, thank you. >> all right, coming up, can fedex get out of its own way will nike's big quarter continue, and can micron escape the semi slump that's all aad ohen three-stock lunch. "power lunch" will be back in two.

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two days three stock lunch focuses on three big earnings reports due out next week, nike, fed exer, and micron let's get the trade ahead of results and we'll doing that with gina sanchez. gina, welcome. let's start with nike, which is actually up 26% quarter to date. >> yeah, nike is a stock that lito has owned for some time, and this is because it has a quality brand. people have brand loyalty towards this, and yes, everybody is getting hit by the spending slowdown we're seeing rare discounts out of nike, but the china reopening is going to help if we see more dollar weakening,

that could also help this is a brand with tremendous eyeballs on sunday, nike will go up against adidas and i don't know about you, but i'm rooting for nike, the proud sponsor of the argentine world cup team >> next is fedex, it's team. >> next is fedex, once we get past the holidays and they have to be thinking in that direction, do things get iffy for them how does it look >> no. one of the reasons fedex has had a drag on it all year is because of its exposure to em. fedex compared to ups, ups has done well, but its biggest liability is about to turn into its biggest asset as china reopens. we think there is upside to where fedex is right now and a stock trading at 8, 8.5 times p/e versus a long-term average r average that is 13, even if you assume that's lower now we're in

a higher rate environment, it's still an attractive opportunity to take advantage of the china reopening. >> all right so what about micron up 3% so far this quarter >> yeah. so this is a tough one you know, micron, obviously,ha negative guidance. people were very -- investors were not happy to hear that they were going to cut their memory chip supply. they were going to reduce capex. we're at a supply glut and we have been in supply glutsz before in 2019, we had a massive supply glut and all the d-ram stocks got hit and we went into a supply shortage and everyone started piling up and we're doing that again the long term on d-ram and demand for memory is very strong you just look at the kind of demand that will come from smart city buildouts we believe in the long-term story on this. micron is one of the more steady kind of more steadily priced stocks, a stock that tends to trade at 10 times, it's trading

at 6.5 times we think that it is a more stable way to play than like nvidia. >> let me ask you about the market more broadly. a lot of people are pointing out we're down 5% pretty sharply since the fed meeting. bond yields are lower. what is the message here do you fight it? do you stick with it what are your thoughts >> we continue to go out telling investors that in this kind of slowdown, you have to stick with it solid demand stories, high qualities, one of the underpinnings the portfolio continues to have. the fed was dammed if they did and dammed if they didn't in terms of what was going to happen they slowed the pace of their hiking cycle that's good news it means we're getting towards the end. it also signals to the market, yes, we probably are going into recession. that's just to be expected when you know you're going into

recession, then you care about how robust thedemand is for th products of the companies you own. >> right exactly. you have to get back to fundamentals, see who can weather it and as you indicated maybe a couple names we'll hear on that front next week. thanks for. >> thank you. we talked about chips. is the bottom in for semiconductors wall street remains divided. at nt. 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. -to-use tools and paper trading to help sharpen your skills, 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.

>> i'm here with marcelo, vice chair. so good to have you here with us there's so much talk right now about businesses cutting costs to prepare for an impending recession. where are you seeing companies continue to make investments >> there's a lot of positive activity throughout, particularly as it relates to customer driven transformation anything that has to do with changing the way an organization interacts with our customers, the product or service they provide. >> can you give us an example of a customer centric transformation >> we have a client here called

wawa that's an organization known for great customer service and they've decided to transform the customer experience from purely physical to one that is digitally enabled, making sure they keep their personal touch, which made them special. they're taking it a step farther to launch new business platforms in areas like catering to engage with the customer in a different way. >> what advice are you giving your clients >> take a look at your business cases and make sure the value propositions are clear if this is a program that will lou you to get through this time and come out of it, go forth and conquer. >> thanks for sharing your expertise with us. >> thank you for having me great to be here

it's been a rough year for stocks, tech in general, chip stocks specifically. the philadelphia semiconductor index, down 33%. that's a third this year is the bottom in depends on who you ask kristina partsinevelos is looking at what wall street analysts are saying. sounds like they're saying everything. >> it seems like that's the theme of the day, right. you mentioned the cma. that's why we always talk about it down almost 3% this week on pace for its first monthly loss in three. both bank of america and cowens, i'll get into specific names, are betting big on nvidia. bank of america analysts say, quote, a soft landing could drive hard takeoffs in chip stocks really, that's a bet that the recession won't be that bad. we can see nvidia shares are down over 41% right now year to date cowen also bullish on nvidia

said russia problems and crypto pain are added to the equation as well and nvidia will be a winner in a.i. we're talking about a bigger call from evercorps. they are arguing that bottom is in the index is clearly falling much more than the s&p 500 year to date. that was the chart we just had before and the drivers for that rebound is the china reopening, this is according to them, memory market bottom, and although we've talked about this quite a bit, inventory levels have been high with a lot of customers they believe had that companies will continue to keep that buffer higher level of inventory to avoid any future problems like a possible pandemic that's why they're bullish on marvel over here, 53% higher over the last year, asmlf, 24 and wolf speed 26% on a one-year basis whereas morgan stanley saying the opposite. they think we're in the first phase of an industry wide rec

correction and believe amd and qualcomm and lamb have more revisions to come. amd the worst performer out of the group, almost 53% lower on a one-year base. >> micron reports next weekend. >> that was in november but that shows we were talking about just the memory pricing they are warning that memory prices have come down and they're going to reduce their production you had a call on western digital as well, same problem. memory prices are coming down and going to lower the average selling price and hurt margins and reduce production going forward. remember we were talking about industrials the hour before. it's the same. do you believe that we're heading in a recession if you believe it's a soft landing bet on these guys, if not bet on these guys. that's how we're dividing them. >> it's simple but not easy as they say thanks. >> kristina partsinevelos. >> stakicking with text, a twee, and soon, ladies and gentlemen,

the coup de grace after tweeting today twitter was on fire musk's take overhas been a thorn in the side of tesla shareholders the stock is down 33% since its deal for twitter closed in october. since he made the offer for twitter in april the stock has lost half its value, $580 billion in market cap, which is more than it's currently worth right now. >> imagine steve jobs bought myspace, right, 15 years ago, and then like got distracted and stopped paying attention to iphone development. >> and apple lost half its value. >> i don't know. he says in the long term, tesla shareholders are going to get benefit from twitter. >> i don't know. all i know is i see more and more people insisting they want, you know, different leadership or more professional leadership, pr teams, ir teams, at tesla to kind of separate it from all the drama going on at twitter. people have made this point that creditors as well, musk's personal fortune is at risk here

and the creditors might be the ones that try to force something to ensure the value of their collateral. >> more than at risk he's a tesla shareholder and maybe repeating that to himself and eventually there will be a benefit here. >> say it enough times. >> maybe it comes law. >> "closing bell" starts right now. stocks under more pressure today as we wrap up another ugly week on wall street and we could see more volatility in the final stretch as a bunch of options expire this is the make or break hour for your money welcome to "closing bell." i'm sara eisen here's where we stand, down 348 on the dow, low of the day down about 550. s&p 500 down 1.25% every sector is lower. some of the commercial real estate places getting hit especially hard. we've also got groups like consumer