i'm sara eisen where we stand in the market, lower down 1.16% the only sector higher is energy the nasdaq down 1.6% as far as what's working apple turned around, higher. tesla strong as well amazon, microsoft, alphabet and nvidia holding back. the dow down half a percent as we speak so clearly some weakness but overall, pretty resilient, considering that strong jobs report and a move up in treasury yields, 3.5 is your yield. the key tech earnings movers alphabet lower, off its worst levels and soft youtube ads hurt them, down 3.5%. apple, up 2.4% pretty remarkable comeback, now higher despite a profit and revenue miss we'll talk about all these names in just a bit. also ahead, national economic council director brian deese joins us to talk about today's

blistering jobs number plus, we'll talk to the ceo of pnc financial for his read on lending and the american consumer straight to the market dashboard. another winning week despite the losses today mike santoli here to break it down mike, i would call this sell-off subdued given the magnitude on the beat. >> very contained, i would say and in a sense, really to be expected even if we didn't get that super strong jobs report, in other words, already up so much and getting stretched in the short term that you would have taken any excuse to back off just a little bit. you mentioned yields higher. they are although very much within the range of the last week or so so it's not as if it's really repriced fed intentions we have the s&p 500 actually made this new multi -- like a five-month high. still well -- i would say we get

a 3% to 5% pullback from here. it will look like regular old profit-taking. it will be hard to really dent this trend with a one-day pullback like we have right now. we also have this really interesting feature of the market, sara, this week which -- year to date, the crash in momentum stocks, momentum etf which tracks what's been doing well previously has completely unwound and here you have the momentum factor etf, mtum on a one-year basis, what we've seen, why is that, people say, oh, speculative stocks are running hard why is the momentum going down the momentum is 60% after last year's 60% health care an energy the momentum etf is defensive and basically stuff not cyclical and big unwind right now and the other side of this is the massive short covering we've seen if a lot of quant funds like

value and volatility and things like that and saw this upside down action so far this is what's destabilized some of the action, made it volatile but i don't think it undercut the message which is underlying economy stronger than anticipated. earnings not great but we already priced it in and the fed maybe kind of coasting to the end of its tightening campaign. >> the question is, is the fed still coasting toward the end of its tightening campaign. the move in the two-year note is significant, off the highs, back above 4.2 and now higher on the week, a bit of a change and recalibration of maybe how much more the fed will have to do. >> absolutely, although it's taking place on taking back some priced in cuts that happened beyond when they finished hiking so you don't want to get into necessarily every little twist and turn but i think at this point the peak rate is still seen as being one or two more quarter point increases then the real debate happens, does it stay for a long period of time

or will something happen that causes them to cut the repricing happened at the outer end of it which is will they cut in that one and two-year window after they finish hiking? >> it seems harder to believe. >> it does, without a doubt. i think it weakens the case for that call. >> right mike, thank you. see you soon let's talk jobs. that strong number that came out, nonfarm payrolls up by 517,000 in january crushing estimates. unemployment rate, falling to 3.4% the lowest level since 1969. average hourly wages gaining a 0.3% which actually is some moderation, something the fed wants to see all this coming despite the fed's efforts to slow down the economy and bring down inflation. i spoke with national economic council director brian deese and asked if he was shocked by today's number >> it was a surprisingly strong headline number and so certainly reinforces the strength and

resilience of our labor market but i think under the hood there were a number of pieces that were positive and positive in what we want to see which is this transition to more stable growth as well i would point to labor force participation that increased particularly for prime age workers. we're now at a -- seeing higher levels of participation, more people coming into the labor force, i think that's a healthy sign and, of course, on wages we saw stable growth in wages but moderation there as well so i think both of those signs alongside the very strong headline number reinforced that we've got a strong, resilient labor market, and we're seeing that progress while inflation is coming down. these are positive signs for where we are economically. >> the market isn't taking it well stocks are selling off on this idea that the federal reserve is going to have more work to do now on tightening to crush inflation and weaken the economy. is that the right takeaway >> well, look, more jobs for more americans and people making

higher real wages is good news it's good news for the economy it's good news for people across this country and i think if you zoom out just beyond this one month what we've seen over the last couple of months, the last several is precisely what we want to see in this transition, resilience in the labor market continuing to hit these historic levels in terms of low unemployment, the lowest in 54 years, wow we're also seeing prices come -- price increases come down. we've seen inflation moderating. we're seeing those signs across the economy so that's what we want to see. obviously we're going to have to keep a close eye on these things but i think it's hard to look at the last couple of months and not seem like we've made significant progress certainly from where we were several months ago. >> does this -- i guess my question is, does this make you fear that inflation will not come down as fast as we need to see? yes, it's great news that we're still hiring, great news wage is going up but we don't want to see inflation turn around and

continue to march higher or stabilize around these high levels so does this make you worry about that >> i would say a couple of things, first, this report underscores that we all need to have a high level of humility in looking at traditional models that have predicted past bouts of inflation i think it reinforces the unique nature of what's going on and that shouldn't necessarily be a surprise given that the pandemic and the response to the pandemic, supply chain challenges are all really quite unique things that we are living through. that's number one. number two is that what we want to see is more people coming into the labor force and wages, moderation and not increased upward pressure. we saw both of those things in this report as well and so i think at the end of the day if you step back we're seeing more jobs, real wage increases, low unemployment, and inflation all coming down. that's good news, obviously we need to stay vigilant and still have a ways to go here for sure,

but i think that we should take the progress that we are seeing in the real economy on both of these fronts and try to build on that progress. >> it's why the jobs number is so surprising and a little confusing. hard to square with what we've seen, the layoffs in the tech sector and i know it's a small part of the economy but spread to the banking sector and chemical and toy companies being more efficient and real weakness in manufacturing and housing so two key parts of the economy how do you put that together with what's happening with jobs? >> well, look, i think there are the headlines and the breathlessness by that was what it was, what you said. their share of the overall labor sector, i think there's a lot of extension of that and breathlessness that was overdone number one, that is. number two, weekly claims are

coming down and hit record lows and saw that in the jolt state of the hiring data as well so we're continuing to see a picture economywide, certainly there are differences in different sectors and seeing some weaknesses in some sectors and grete and strength in others but economywide overall we have a strong labor market, a resilient labor market and we're seeing that resilience even in the face of prices coming down so i think that's the core takeaway. >> then the services number too was pretty decent. it does make you wonder if the economy overall is accelerating or stagnating right now. which is it? >> well, look, we have for months now been in this constant state of people projecting three, four, five months out saying there is a recession on the horizon. people were saying we're in a recession now which i think no rational person can look at the data we're seeing and draw that conclusion i think what we're seeing in this economy is resilience i think we're seeing resilience

as we continue to move toward a more stable equilibrium and more steady growth and think that is what we're seeing right now and there's no certainty we will see that going forward what we have seen over the last couple of months should give us increased confidence in that outcome and from a policy side there's a lot of things we can do to try to reinforce that in particular implementing infrastructure, innovation investments and -- in a way that gives companies the certainty to invest through this transition and, of course, avoiding the kind of unbelievably negative self-inflicted wound that we could do if we had drama around the debt ceiling >> so are you leaving on a high note why are you making the decision to leave now is this your last jobs report? >> well, i made the decision to serve this president for two years. i've got young kids at home and it's the right time for me to pass the baton, but it's been an

extraordinary privilege to work for this president over the last two years. it's been extraordinarily unique and i will pass the baton and continue to road for this president and support his policy agenda from the outside. >> will you go back to blackrock? >> i am going to go home to my kids and recharge, that's my only plan that i have right now. >> all right well, keep us posted brian, thank you very much appreciate the time. >> thank you no word on the blackrock question biden denounced deese's stepping down and hasn't named a replacement. lots pointing to the vice chair of the federal reserve to take that job as the national economic council director. taking a look at the market, we are at the lows of the session now down almost 200 points on the dow. every sector has gone negative, energy just joining the rest down 188 after the break amazon and alphabet holding on to gains for the week still and strong gains for the year despite today's

earnings pullback. we'll dive in with an analyst who cut his target on both stocks you're watching "closing bell" on cnbc.

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missing on earnings and revenue. joining us now to drill down on those two in particular alphabet and amazon, joseph spoolly yusuf, it's down more than 8% at this point you still think this is a buy. did it not shake your confidence in the story >> no, it did not shake our confidence in the story. the reason the stock is down on what's happening on aws. that growth did slow we were hoping they would maintain high teens in 2023. now we're talking low teens but we still think it will turn the other way and start accelerating we don't think this is a structural issue we think it is a temporary issue and have seen it with azure and

our google cloud so don't think it's particularly, you know, worrisome long term. short term clearly, you know, as revenues go down this is a high margin business. margins go down and has an impact on amazon's overall productivity if you look at their e-commerce business they grew 14% in the u.s., right? they continue to grow market share even though they control 45% of e-commerce. advertising business, they grew market share they grew at 23% advertising by and large. growing like 5%, 7%. a lot of things to be excited about but aws is a black eye for them and valuation is still attractive. >> the weakness in aws, you noted it came on revenues, margins and the guide down for the first quarter s. that macro? are you saying you think it's temporary because it's influenced by the -- >> that's right. >> or is something else going

on >> no, that's it i don't think it's competition what we're seeing is the workloads across the entire swath of industries, maybe less travel recently because everybody is traveling again but, you know, number of industries that are just seeing less consumption and because of that they're pulling back. at the same time all of these companies, you know, ours included are looking for ways to be more nimble more efficient with costs so a lot of large companies that have already moved to the cloud have been changing their contracts with aws and jwp with azure from kind of a long-term guaranteed type of consumption monthly over quarterly to more flexible structure for them, you know, to pay less when there is less consumption. that's what they have had to do over the last two quarters unfortunatelily, again, i think it will continue for the next

two or three quarters but don't think it's structural. >> what about alphabet clearly the disappointment there on the weaker advertising environment which is something we heard from the others, even meta, though the stock reacted positively there what was the problem here? did the street expect more cost discipline >> well, yeah, so i don't think honestly it's about necessarily the top line on the advertising side because, you know, consensus was thrust 1 they came in at plus 1 or plus 0.9. the issue was more about to your point cost discipline. you know, this is a great team, great company. they don't tell you much on the conference call is the bottom line a lot of investors and analysts went into the call hoping that for once they'll actually commit to cutting costs by a certain amount, hitting certain margin thresholds, et cetera and they didn't do any of that so that was a big, big issue for a number of investors. the other is called microsoft, right? microsoft is working with --

>> yeah. >> they're trying to incorporate chatgpt in their search algo so that's been seen as many as an existential threat to google or alphabet we wrote quite a bit about it. we think it's too early to make -- for a determination but you step back and realize that alphabet has been investing in a.i. more than anybody else and for -- really longer than anybody else and so next week they're going to be launching or unveiling their own lend out which is their natural lend which model similar to chatgpt and then we'll see where that goes from there but those are the two issues that have been weighing down the stock. >> so you like it. 120, numbers go down so of all of them one second left. which is the best opportunity

right now after earnings >> between the two i'd go with google >> what about your whole coverage list? >> oh, well, i mean -- >> your favorite >> one of our favorites going into 2023 with facebook and that's obviously a lot higher. amongst smaller names the trade desk, a great play connected tv. we like double verify which is also a partial play on play tv. >> youssef, thank you for joining me from truist. down 120 on the dow. we recovered a little but still heading south. down 1% on the s&p 500 it's a winning week. the nasdaq is still up 3% and energy is just popped back into the green on the day everybody else is a little lower. consumer discretionary getting hit the hardest, an amazon story. the nasdaq down 1.5%

ryan cohen's latest investment and a brewing boardroom battle the meme king's next target. as we head to break check out the biggest winners on the week in the nasdaq 100, which itself had a winning week at 3.5% align, meta, amd, we'll be right back

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what is wall street buzzing about? activist investor ryan cohen and his latest target nordstrom is one of the largest nonfamily shareholders, wants to use his position to shake up the board to support cost-cutting efforts as well and no markdowns here. look at shares surging on the news 25%. they were even higher earlier. still down nearly 70% from all-time highs that were back in 2015 we reached out to nordstrom for comment, the company telling us,

quote, while mr. cohen has not sought any discussions with us in several year, we are open to hearing his views as we do with all nordstrom shareholders we will continue to take actions that we believe are in the best interests of the company and our shareholders remember, koberstein made his fortune with online pet retailer chewy grew with the meme crowd when he used his stake in gamestop and took a stake in bed, bath & beyond but exited in august and built a stake in chinese tech giant alibaba other investments include apple, wells fargo, citigroup and netflix according to "the wall street journal" which first had the story and mike santoli, the 25% move up in order strom justified? >> i would say not on any basis in terms of what cohen might be doing, maybe to spotlight the fact this is a depressed stock at the lows in january trading at less than 20% of sales. that's as low as it's ever been basically if you go back decades

so, yes, down on its luck department store stock, fine, maybe as an entry point, but not based on anything cohen has done in other challenged retailers like gamestop and bed bath -- even the chewy piece, sold, you know, for a fraction of what it would be worth a few years later. apparently petsmart had to build a lot of that company while they owned it since then the gamestop was just really a lightning in the bottle mania that grew up out of almost never. >> and the company didn't turn around and bed, bath & beyond went bankrupt. >> there is a way he monetizes the kind of afterknow of the gamestop experience, but it doesn't necessarily mean anything is going to happen as a result >> it is a thin -- it's a small board, a thin board and the former bed bath ceo is on that board so making interesting point. >> there may well be moves to

make >> the family owns 30%. >> they wanted to take it private years ago. >> they tried. mike, thank you. this will be fun to watch. mike santoli. up next the pulse of the economy and consumer lending when we are joined by the ceo of pnc bank be right back.

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as we head into the final half hour of trading we're seeing the dow down 125. the s&p 500 down a percent as well still hanging on to gains for the week but combination of weaker response to earnings from amazon and alphabet and, of course, that very strong jobs report, pressuring stocks today. the nasdaq down 1.5% that blow-out jobs report, of course, concerns about tech earnings, all hurting the market snapping a three-day win streak. for more on the economy let's bring in pnc financial services ceo bill demchak joining us in a "closing bell" exclusive interview. bill, welcome back good to see you. >> hi, sara. it's great to be back. >> we've got to start with that stunning jobs report we got this morning. how does it fit into your view of what's happening to the u.s.

economy? >> i'm going to try to do my best to not be the next armchair economist but no matter how you look at that number, that was a wow number and it fits into, you know, the thing we're seeing across all of our clients. there's nothing in that number, nothing we're seeing that, you know, is suggesting we're heading into a slowdown any time soon. >> so do you forecast a recession? >> we have it in our official forecast but it's -- you know, we like everybody else, we keep saying, all right, we know this is coming then every single month something happens where we push it out to the next quarter or the next month and, you know, it just seems as long as the market is going to keep fighting the fed here, we're going to have this big showdown at some point and it will happen, and, you know, in some ways the longer it takes to get there, the worst it's probably going to be >> so tell us a little bit more about what you're seeing, bill, or not seeing in this case any softening in commercial or consumer credit?

>> no. no not really you know, we had an isolated incident in the fourth quarter, we've seen some normalization in what you would expect to see with the consumer, but if you go back to basics, our basic consumer checking account, you know, is materially up from where it was, you know, pre-covid. it's lower than its peak but it's a lot higher than it was and the days spending coverage the consumer has against ordinary monthly bills is much higher things feel really healthy >> they do but you're putting aside more and more provisions for bad loans so clearly expecting it to turn >> well, welcome to the world of cecil. we have a model. we make a forecast, you know, and just like every other economist, you know, not every other one but basically consensus view we'll run into some shallow recession and

that's what we have and we run a model. if that happens at least against history we'd have bigger provisions and losses. part of the issue is we run into, you know, we're running into this potential where we'll have a full employment recession where maybe gdp slows for a bit but the labor market continues to be really strong. and that's unknown territory in terms of what happens to credit losses i think if that happens credit losses are a lot less than what people would otherwise expect. >> but you have to see it in part, the housing market, commercial real he late loans. there's got to be stress there. >> so in the housing market so residential, housing prices are coming down. the affordability of a new house, it's tougher. but the loans we made, you got to go back most of the loans we made over the last handful of years, the market ran up from when we made the loan so the loan to value is still good

the affordability for the loans we own is great because interest rates, you know, were coming off a base of zero so a new loan today, that's why there aren't many, it's much more expensive but the stock of what we own is fine you know, there's a little stress we don't play much in the space but stress in the used auto market because of how high residual values got but don't see it in our balance sheet. part is who we are but i think a broader piece of that is just the economy is stronger than people think it's coming down from what was, you know, just a roaring growth in inflation and wages and jobs and everything else and spending and it's slowing down at the margin but you got to go all the way back to precovid and feels good relative to where we were precovid. >> do you think the federal reserve will keep raising interest rates it obviously impacts your business and has been helpful

for your net interest margins. >> yeah, i think -- i don't get too hung up on whether they'll go another 25 or another 50 or keep -- it's a function of how long they keep them there and i'm in the camp that they're going to stay high for longer, you know i take powell at his word. my own economic views are closer to what the fed is talking about than perhaps what's priced into the market even after today's move. >> right you don't see the cuts coming any time soon? >> i don't i mean, the basic notion, if we -- even if the economy slows down if we're running near full employment and even if we get inflation to a two handle why would they cut, real rates would be marginally higher, why do the and run the risk of lighting off inflation again and they'll get there at some point but i don't think there is a hurry to do it. >> some of the analysts were confused you've given a pretty positive

outlook. loans rising, interest rates are rising that you talk down your net interest income numbers and there was disappointment after the last quarter. >> yeah. >> how do you explain that >> well, a couple things the -- for 40 quarters we missed our earnings guidance three time, one of those times was in the fourth quarter this year where we had some anomalous one-time expenses and we had one big credit that was going to go bad no matter what the economy did and what point in time it was, it was a poorly run company and we had a larger position than we should have in it. and that, you know, we're predictable and we weren't in the fourth quarter and disappointed our investors and so, you know, that -- we look into this year, you know, we know they'll go higher simply because the model will force them to that place we talked down versus what analysts estimated on net

interest income and we did that partly because deposit costs are rising, no surprise, fed shrinking its balance sheet. rates going up paying more to consumers to keep our share but because unlike the capital markets, credit spreads in the, you know, largely investment grade triple b area which is where we lend, credit spreads haven't gotten wider it's not reflected, banks are slow at this and so, you know, so part of what we would have otherwise had in our head two months ago was credit spreads and revenue will go up more than we put into, you know, the comments we put in the fourth quarter. we'll see what happens we're no different than any other bank maybe we're a little more straightforward but spreads go up, it will benefit other, if deposit costs go up, it will hurt us and other banks. what are credit costs going to be and what are deposit costs going to be into this year

that's going to be driven by the market and economy >> what about -- why aren't you paying higher rates to depositors. >> we are paying higher rates for depositors you know, it's -- a couple things are happening first, you pass along, you know, you get a particular margin on deposits and rates go higher and pass on that incremental margin but also the competition for those deposits is liquidity generally is drying up on the back of the fed's efforts makes it more scarce so if you looked at our average cost of deposits over the course of the last year, hasn't gone up as much as the fed is, that's kind of the beauty of retail banking but it's gone up materially. >> all right fair enough. well, that's why investors like to hear from you, bill you are straightforward. see if it proves conservative or not. appreciate it. >> yeah. >> bill demchak, the ceo of pnc

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anymore. find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com. check out today's stealth mover, generac experiencing a blackout guggenheim downrating them to neutral from buy removing its current price target citing valuation and concerns wall street's earnings estimates for this year are too high the stock had been a real power on wall street up nearly 30% year to date after being one of the biggest losers in the s&p

500 last year. that has been a pattern. a lot of the losers of last year, some of the biggest winners of '23 weakness in china pulling off shares of starbucks today. find out why the company thinks the head wind could soon fade straight ahead that story plus apple rallies and ford falls when we take you inside the market zone 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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on ford. mike, we're still hanging on to gains. the nasdaq down the most 1.7 feel like the market can't figure out coming off of that high from wednesday and the fed meeting where powell talked disinflation, powell brushed aside concerns about looser conditions can't figure out whether it was a game changer in terms of how the fed would think of how many more interest rate hikes are to come or what's next. >> part of the reason why they can't figure it out. i doubt the fed itself would know exactly what their response would be because there's going to be a time element to how they change policy from here. we have, you know, six weeks to the next meeting we'll see what the data looks like over that period of time. going in small steps, i don't think there's going to be a overreaction because the premise was already, this is a tight labor market and powell explicitly declined to try and

pinpoint some very big jump in unemployment that he believes will be necessary to get inflation under control. for that reason the market is treating it, you know, without huge stakes attached to today's number and, by the way, just in general we came into the week up 6% in the s&p on the year, the common refrain was going to be tested we have a fed meeting and we have the big tech earnings and through it all even though all the tech earnings weren't great we're not only up for the week but up 2% from right before the fed announcement came on wednesday afternoon. so obviously we cleared that test we'll see where it goes from here. >> how about that? let's hit some tech earnings apple investors brushing off a weak quarter managing to overlook the company's largest revenue decline since back in 2016 the drop was largely tied to currency pressure and production setbacks stemming from china's covid disrussians. shares had been lower to start the day and rebounded shortly after the open, mike why the rethink? >> you know, first of all, it wasn't a dramatic reaction

i feel like people were definitely brace the for a not kuwait quarter there's clearly a lot of faith that when you have management credibility as, of course, apple does and when they say they see things bottoming and turning soon and will be able to get production back where it needs to be even though they didn't give explicit guidance, the idea they will make it work the other factor is whenever there's a little bit of a short-term setback for apple, it almost gives the bulls a reason to say, here's what's going to get better there is not a great growth story here, especially in the near term, much more about steadiness so i think the market where apple outimportants by a lot from here is not a great stock market in my opinion it's still going to be mostly defense. but it's holding its own without a doubt and it's, by the way, almost triple the s&p return over the last three years so owes you nothing from this point. >> let's hit forward it is tumbling ford came in below estimates

supply chain to blame. the ceo there discussing the quarterly miss with cnbc earlier. >> we lost about 100,000 units of production and that's material for us. came in late in the quarter, most of it's chips but some new supply issues that you could say, hey, that's kind of bad luck for ford. that's not how we see it we could manage our supply chain, also different ways, we were dependent on broker chips, things like that >> emanuel joins us now. he djust downgraded the stock an you heard the ceo there, he blamed the supply chain but i read your note and it sounds like you see bigger -- more varied problems here >> yeah, hi, sara i think it's more than just supply chain. i think there is a few things that bother us with the print and outlook. i think there's lack of

visibility and planning i think from the company they had a profits warning in the third quarter but swore it would still be able to deliver the full year guidance and three months later very large miss in there. i think their cost structure remains high fixed costs as well as in terms of their bill of materials and there's no traction that's coming across the numbers and so as people want to be optimistic or positive on ford they're essentially thinking, look, could these guys improve their margins interest their current lefts? we're not seeing any traction and the outlook they gave for 2023 seems aggressive to us and we see quite a bit of downside >> right, yeah, you have to compare it to gm which reported earlier this week and had a good quarter, didn't it >> yeah, absolutely. gm had a great quarter their guidance at the time might have felt alittle aggressive now in retrospect seems conservative to what ford is saying because ford is essentially saying, look, we

didn't perform well but we will get $2.5 billion in cost savings as we move into '23 in the case of gm they're expecting a few hundred million dollars of savings and guiding for earnings down at gm which is realistic len ford expects theirs to be flat which will be difficult to achieve >> so why is there a problem with visibility on supply for ford and not as much for gm or tesla or some of the others? >> yeah, so i think this is our point. that supply can absolutely be destructive one quarter to the other. rewind back to middle of '22, quarters gm missed as a result of not being able to secure enough chips so these things absolutely can happen. it's just when they happen, you know, on a regular basis when questions are being asked. in our case we think the ford issue is less about supply,

which maybe created weakness in the quarter and much more about their cost structure which is considerably heavier, you know, than gm. several points of margin and investors were under the impression that they were working on it and it does look like this is the case so far so now the message from management was don't worry, this year, i think is quite difficult to accomplish the sort of very large savings they're targeting while investing at the same time so much money needed for electric vehicles and that's i think the conundrum of ford. they need to fix their combustion engine operation and invest at the same time and prompting to improve earnings and returns at the same time as well all of this is extremely difficult. >> emmanuel rosner, thanks for joining us today appreciate it. with ford down almost 8% starbucks shares are also sinking after the coffee chain posted an earnings and revenue miss weakness in china one particular

pain point here. outgoing ceo howard schultz saying a third of its locations in china were closed during the latest covid surge the company's cfo sat down with "squawk box" to talk about the situation in that country. >> we have every confidence that the head winds we're seeing in china today will lead to tailwinds and that's what gave us the ability to reaffirm our guidance on a full year basis but also gives us a lot of confidence in the growth that we've -- the growth that we've outlined for the years to come >> mike, what is the market's take on this one jo. >> i think it's a little bit, first of all, this is one of those stocks that had performed very well in the last 12 months. it's -- >> 52-week high. >> exactly and basically for the last year it's performed pretty much in line with chipotle so naturally people were in the more stable consumer names not super cyclical so a giveback there and then the story gets refreshed a little bit with a

potential china re-opening and maybe currency getting a little easier around the world. so, you know, it's hard to say that there should be a big swing one way or another, trades at a midhigh 20s p./e. where these companies are these days and, you know, market is absorbing it okay in the context of how much the stock had done last year. >> overall earnings reactions? are you getting a thread it feels like it hasn't been the best earnings season >> it hasn't we've finally nudged up to 70% of all companies beating estimates which is roughly the historical average but it started very slow and there's been some sloppiness when it comes to guidance. a lot of downward revisions. the fact that the market toughed it out and looked beyond that probably shows you that the analysts' consensus were lagging what people were expecting, in other words, the investors themselves pretty much figured it wasn't going to be great. the other thread is, obviously meta, the most dramatic example but the sense out there that

management have costs and do what they can won't be successful in all instances. there's retention of a lot more employees across the economy we saw today than we might have thought. but right now we didn't think it would be a great earnings season and we're holding on to most of the gains year to date this week >> i'm really thinking about bill demchak, ceo of pnc telling me no real weakness in credit for commercial or consumer two minutes ago in the trading day, what are you seeing in internals. >> giveback under the surface. it's been a feature of the market, it is negative you see almost 3-1 declining to advancing volume so you have not just a weakness in the megacaps driving down the s&p, it's pretty broad today take a look at natural gas making more new lows, actually the fossil views in general weak today but natural gas over two years is kind of a crazy round trip actually now negative on a two-year basis but sort of a

bonus for the rest of the economy typically all else being equal. volatility index a little bump midweek when you had catalysts from the fed and jobs number coming up. quiet right now, some are going to say a little too low. maybe we'll get there if we dip down to the midteens but so far shows you a market much more stable and row take and bond volatility is way down. >> well, looks like we'll end an up week on a down note with all of the major averages lower. the dow which got about as low as 200 points or so at the low down 133 right now as far as what's having the most impact, home depot, honeywell and tech has been strong, not so much today and explains the s&p 500 down 1%. you have every sector lower here into the close but, again, for the week we're still nicely higher, 1.65%, fourth up week in the last five, the nasdaq down 1.5% today but overall for the week as a whole up 3.4%.

today it's a story of earnings weakness, amazon, microsoft, alphabet, nvidia all pulling back but overall held their gains with that celebration earlier of fed chair powell potentially hinting at winding down rate hikes, at least that's what the market took out of it even though he didn't say it explicitly there goes the bell, three major declines -- not major, minor declines that's it for me have a good weekend. see you next week. >> welcome to "overtime. you heard the bell and getting started at the new york stock exchange coming up we are going to have a look back at one of our most memorable moments. the brawl that started it all. icon versus ackman can you believe ten years later? i spoke with mr. icahn today what he told me about that shocking day a decade ago. we begin with our talk of the tape the state of the ral