>> yes, it's fine, everybody we are busy people but tyler has the real wisdom, should we skimp or not skimp do we make the most of these days >> don't skimp. >> especially not on the flowers? >> i'm not a big flower guy. i like flowers, but i'm not a roses guy. i like to get arrangements >> this is wisdom right here. >> the roses are all inflated on valentine's day. we've got to say good-bye. thanks for watching "power lunch." "closing bell" starts right now. >> stocks giving up an early boost as investors weigh mixed earnings and a still muddled economic picture this is the make or break hour for your money welcome to "closing bell," i'm mike santoli in for sara eisen here's where things stand in the market at the highs, the s&p 500 this morning was up almost 1% it now has declined to basically the lows for the week. we hit these levels back in the early part of the week monday and tuesday. nasdaq still the outperformer but was up more than 1% a little

earlier, firming on the ten-year note yield as well coming up this hour, we'll talk to the ceo of sunnova as another name in that space sees strong interest canter's eric johnston joins us with a new warning for the bulls for what he calls sentiment and positioning in the markets that dramatic change in sentiment and positioning has been a big part of this story among this rally we've seen since october, which accelerated at the beginning of this year. it's brought the s&p 500 to this level. 42, 4,100 had been targeted for a while as a zone. it might be a little bit tough, a little congested we're consolidating that january gain this is roughly the upper end of the range we've been in for some months here. mostly just chopping around here, not a lot of downside acceleration either, but we are hesitating as we wait for that cpi report next week as well take a look at disney. the big story on the day, the stock is up, well-received,

earnings as well as a strategic plan, but here's longer term view of the valuation of disney relative to a couple of general peers and communication services sector, alphabet and comcast our parent company disney is already in the mid-20s in terms of a forward price earnings multiple. this you can kind of ignore, that's when earnings went away and the huge excitement around disney plus made it a pandemic stock. this is still kind of the highs. you also see all these companies were kind of clustered together around the same valuation, if you go back to the mid-2010s, and now you see this big premium with disney. what does it mean? it suggests that investors have been giving disney a certain amount of credit for under earning. they're going to get the cost cutting for the quality of the franchises and that they'll figure thing us of the with the scale they have built on the streaming side it maybe explains a somewhat muted reaction today in a stock that's come back pretty far in a

short period of time let's go a bit deeper on disney and the big moment of the day on cnbc that all of wall street has been talking about, ceo bob iger spoke this morning with david faber about undoing some of the changes made by his successor turned predecessor bob chapin. >> the structure of the company that had been changed by my successor and my predecessor, but bob, and he had a reason why he wanted to do that, and he articulated that, but it created a huge divide between the creative side of the company, the content engines, movies and television, and the monetization of the distribution said of the company, and while i think he -- again, he had certain maybe valid reasons why he wanted to do that at that time, it was very, very apparent to me both while i was out and when i came back that that was a mistake >> just after the interview activist investor nelson pelt who had launch add proxy fight

against disney called into squawk on the street with his reaction to the changes that iger announced. >> this was a great win for all the shareholders management at disney now plans to do everything that we wanted them to do we wish the very best to bob, his management team, the board we will be watching. we will be rooting and the proxy fight is over. >> let's bring in david faber for more on the big takeaways from iger and disney from the reaction to it all, david, and you know, it seems like on a simple level the street is saying that bob iger with these moves that he's unveiled, the reorganization, the plans for cost cutting, the kind of return to the core feel that he has conveyed out there, he's controlling what could be controlled and has a credible plan to execute on that, even if a lot of the big strategic, you know, kind of asset disposition

or accusation questions are still open >> yeah, i think that's a really interesting point you made with the charts as well there, mike we are seeing the stock to the point you made as well turn around this is a stock that had been up as much as 6, 7% in the after market, right after the conference call when they unveiled the cost cutting plan it was up a lot more this morning. it's now down n. in part i also think, i agree investors are willing to look beyond really the current quarter or the next quarter. when you do in particular -- and this may be one reason why the stock has turned around, you know, linear cable networks, which we also spent a lot of time talking about during our time together this morning, linear cable networks not doing particularly well. the overall revenue number is down 5%, they did not guide to any great resurgence there in fact, the opposite, and so i do think that's a concern of some investors right now

although, as you say, given the valuation, you're clearly looking past that to the point being that iger can deliver on so many of the things that he's promised now but that won't be front and center for at least a number of quarters >> for sure. and look, $5.5 billion in costs is a lot i mean, it's a real number, obviously it's not going to happen immediately or even necessarily in the current fiscal year, but that's a material number that should boost earnings from what we thought before i guess the other piece of it is, and the reason i talk about it being a credible plan, a lot of what bob iger spoke to you about, which was, look, linear cable is no great thing. we kind of know how to run it. it's in decline. we can be smart about it. and also his feeling that general entertainment content is just difficult to make money in. i hear that, you know how this goes back when iger first took the ceo job and, you know, the

mid mid-2000s, he said why are we making these me too pictures in other words, he's been shrinking the abc network for a couple of decades in a managed fashion. i just wonder -- it's just a familiar feel, he might feel like he's got the playbook even if the macro environment is not going to be that friendly. >> i think those were all good points, and he did double down on talking about general entertainment so to speak, even -- and this was a bit of news that he shared with us this morning when it comes to hulu where i think it's now far from clear whether disney wants to actually own more of that asset and might prefer to part with a sum if not all of it we'll see. he clearly indicated that because, in part, it has such an imprint in the general entertainment genre, if you want to call it that, mike. you know, what else has gotten people's attention when it comes to the cost cutting is the $3 billion they're going to take out of non-sports content

spending so that's going to come a lot out of direct to consumer. can you do that and still maintain the numbers if not increase them? they certainly are encouraged by the fact that they raised price on the direct to kmconsumer product disney plus, and did not see a lot of churn off of it if you give people less, are they still going to want to pay more that's going to be a question. they're doubling down to your point on their franchises because that is what has worked the best for disney throughout the years. >> yeah, and his, you know, professed flexibility on hulu in terms of which way that maight go, it really does raise the question of what was acquired of lasting value through the fox assets you know that was part of peltz's criticism. the thought was you're getting kind of control of hulu and then the fox cable networks, and the studio of course which was a kind of manufacturer of content for streaming.

>> yeah, i mean, they would still say, leisten, we got the main thing, which is the manufacture of content for streaming which allow us to increase our franchises, avatar being a key one, 2.2 billion or so at the box office, number four movie of all time, and enabled them to actually be able to withstand, if not benefit during the period where nothing else was open. there's always going to be criticism about what they paid for fox. if they do depart from hulu, it would seem they're probably going to get their money's worth there. on ska, when our parent company came through, they were able to sell those sports networks as well they're basically bankrupt there are certain things that move around when it comes to sort of valuing fox and how it ended up being for disney. you're right, you know, mike listen, direct to consumer is the key here it still will be the key they've got to get to profitability by the end of 2024 or at least that's what they say they're going to they're no longer pointing

people to sub metrics as much as they were in terms of ever increasing numbers they want to get to profitability. i'll come back to you, mike. we've had this discussion for a long time. iger pushed back on the idea that you can't replace the cable ecosystem with something that is as profitable as direct to consumer he says or at least still believes he can. i'm not sure we've certainly seen no evidence of it to date. >> no, we don't, absolutely not. nothing is replicating the economics. it's all kind of consumer surplus and people trying to get up to scale expensively. yeah, we will see how all that goes and you're right to point to the box office obviously a huge performance recently with avatar and they got a 20% market share of all global box office in 2022, so that's not exactly broken. david, great stuff as always, we'll talk to you again soon >> thanks, mike. all right, well, let's get back to the broader market and this downturn we've been seeing throughout the session joining us now is fair leaf strategies founder and managing partner katie stockton, she is also a cnbc contributor.

katie, love to hear your interpretation of what we're seeing this week, this sort of churn in the indexes is it just kind of a healthy digestion of this rally, or is there something potentially that's a more dangerous loss of momentum >> well, so far we don't hav any clear cell signals into this rally. it obviously has entered a consolidation phase. what we're seeing is really outside of the major indices the s&p 500 still has the support of the short-term trend, albeit not as much as last week naturally, but what we're seeing is a loss of short-term upside momentum behind the likes of bitcoin and chinese equities so areas of the market that are a bit farther down the risk spectrum are certainly showing some cracks. >> yeah, that's an interesting i guess distinction to make right now because so many of those areas did seem to get kind of over excited in the first weeks of this year, and the question has been whether they can calm down and leave the indexes more

or less unharmed the nasdaq 100, where does that fall at this point people keep fixating on particular levels that we're basically flirting with now. >> i think they should be focusing on triple q's or nasdaq 100 and really the megafcaps tha drive it the megacaps have exhibited leadership on the last push higher that last push higher allowed for breakouts in the likes of apple and microsoft about their 200 day moving averages, and at the same time we've seen breath contract so we're no longer really talking about the breath surge that characterized much of january, but now we see an actually pretty notable contraction in that pa participation. and that puts even more onus on the likes of apple, even tesla in there too, all of which still have the support of the short-term trend i would be very sort of carefully watching them because if they do start to pull back, i think that that could impact the major indices in a way that we have not yet seen and of course

market sentiment is at places where you could consider it to be overly bullish after january's rally really instill thes some confidence in the tape. >> i was going to get into the sentiment idea, this idea that there has been a bit of an embrace or at least a chase to grab exposure to some of the riskier parts of the market. the fear and greed index ticking up into the greed zone i guess the question is is that in itself a reason to be wary of the market because i assume whenever the next real bull market starts, if it hasn't already, that stuff is going to start to look better, and people are going to get more involved >> that is actually a really good point i mean, we definitely see surges in breath around the start of bull market moves the we do see sentiment improve. now, the key is that they have to hold sort of up near current levels so we need to be able to maintain that market sentiment in the way, of course, the

market could do that is by continuing higher, seeing more breakouts. so sentiment alone is not any reason to be counter trending. that's why we always go back to the momentum gauges. and as mentioned, short-term momentum is just not quite what it was before. so we're watching and waiting for our indicator to cross over, and that would be a trigger for a pullback we also continue to watch the volatility index which would suggest that sentiment is shifting to the downside meaning that people are losing confidence when that vix gets back above the 50-day moving average, which of course it's still very close to it those are our two risk metrics we think sentiment is tertiary >> just in terms of the s&p 500, if it broke below a certain point, where would that essentially say that the benefit of the doubt is no longer with the rally? >> i would say 3,900, that area

would be the -- that i'd focus on as initial support. it's defined by both the daily cloud, and if the high from february 2nd proves to be a short-term peak, well, then a 38.2% to get technical on you s not far from that 3,900 level. below that that's where we start talking about a more significant retracement, something that could be more than just a partial retracement and, in fact, a full retracement so that level certainly holds some importance going forward. >> all right, 7% down from here, katie, appreciate you always getting technical. thanks a lot we'll talk to you soon we have a news alert in the crypto space, kate rooney has the details. hi, kate. >> hey, mike, so we've got the latest crypto enforcement action coming out of the s.e.c. today the s.e.c. is charging crypto exchange cracken with failing to register one of its offerings. it's a $30 million fine for kraken they agreed to cease one of their offerings. it's essentially a way to earn

high yield on your cryptocurrency the release here says kr a, ken was offering up to 21% yield on this product they're saying they needed to register this as a security. it's something that coinbase has also talked about, the ceo of that company, brian armstrong yesterday tweeting about this issue and some of the rumors that the s.e.c. may be looking to end staking as it's called for u.s. retail investors. he tweeted saying that he hopes it's not the case. he believes it would be a terrible path for the u.s. if it was allowed to happen. this has been seenl as a big moneymaker for some of the crypto exchanges coinbase shares have been down for the last day or so, not necessarily after this news but taking a hit bitcoin has been down as well. you can see coinbase down here as well today. the latest action from the s.e.c. back to you, mike. >> interesting, seems like going after what they call unregulated securities is the path end for the regulators at this point thanks so much.

shares of solar tech company next tracker are jumping in their public debut today after pricing above their expected range. up next we'll talk to the ceo of another solar firm, sunnova about what that strong debut says about his industry. you're watching "closing bell" on cnbc.

ah, these bills are crazy. she has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call

coventry direct today at the number on your screen, or visit coventrydirect.com.

shares of solar tech company next tracker getting a big pop today. the ipo priced at $24 per share making it the largest ipo since mobile eye which went public in october. the company sells hardware and

software that enable solar panels to follow the sun, which improves the output of solar power plants for more on the sew already industry, let's bring in sunnova ceo john berger. it's good to catch up with you i know you're largely focused on things like in-home installations as well as some commercial applications. i mean, clearly the market responds to this ipo, a longer term enthusiasm for the area remains pretty well intact the question is near-term demand, i think. there's been some questions about choppiness in demand for your product and things like california where do things stand this year in terms of growth rate? >> yeah, thanks, mike. yeah, there's a lot growing out there in the solar industry both on the front of the meter, the utility side of the meter if you will, that's where nextracker makes their business and on our side the home and business side of the meter, so to speak, there's a lot that's changing, and some of that's brought about by technological change, consumer change, utility

rates are continuing to escalate as recently as some more utilities rates as recently as this week. and so, you know, if you go through and you look at behind the meter where sunnova is a service provider, there's about three things that are going on that are different there are changes, and that's giving investors a little bit different signals and there's reasons for it the first one is the sale's a lot more complex and sophisticated. it's not just about solar panels you have batteries, load management, there's a lot more going on there the ira which was a big law that was passed, that's got a lot of excitement here for nextracker, that's also setting a lot of production equipment there's been a lot of a shortage of equipment over the last few years, and we see that abating and flipping the other direction. we're seeing a lot of batteries out there, a lot of equipment, and the last is is that the ira, the inflation reduction act,

incen incentivizes a little bit different financing, leases, ppa, power purchase agreements, pay by the kilowatt hour like a utility versus loans if you're selling only loans, your business is going to go down sunnova you can do anything you want, cash, lease, power purchase agreement loans and so our business, what we look out there in certainly the the last few months, we see a lot of strength, frankly we see a lot of demand out there. we see the business overall growing quite nicely, and as recently as this week, we're still seeing a lot of demand from consumers to go out there, save money and have a higher reliability of power for not only their home, but also their car increasingly as we've seen those eb prices come down and incent a lot more consumer demand for evs as well >> draw the connection a little bit more between ev demand and why you might want to have this kind of in-home power situation? >> certainly, it's very simple instead of going to the gas station, you go to the house you can charge up anywhere even

the home, even the office rather or restaurant or something of that nature. of course you've got the super chargers, we've all seen those out there on the highway, but the home is the gas station. it really supplies a lot of the power to electric vehicle. i can tell you that that's what happens at my house, for instance, and so you got to get that power from someplace, and you want it cheaper, and you want it more reliable, and frankly, you want it cleaner that's exactly what sunnova's energy service provides. we're seeing a lot more demand if you buy an ev or two or three electric vehicles, you're going to want to have that, you know, sunnova service or power service to be able to bring that cost down and make it easier for you and, frankly, a lot more reliable >> what is the -- i mean, i know you can't always generalize about these things, but what is the pay back appeared for an existing homeowner to convert to one of your systems? how long would it take to essentially pay for itself >> well, we provide financing,

as i mentioned, mike, you can choose whatever structure you want, a loan or a lease or a power purchase agreement, so that the savings are immediate to be very clear about it. however, if you want to look at that from my side of the ledger, if you will, the payback period varies quite dramatically from each area. but typically is around ten years or so, and what i want to point out here is that we've actually seen the economics improving quite dramatically if you look at the price of electricity, utilities are charging homeowners, it went up more last year than it did in the previous ten years combined, and it's still going up. it's still going up. so even as we've seen some leveling off in economic activity, a little bit in interest rates, we're still seeing those rates go up there's a lag effect the utility rates didn't raise it as much in the front end as inflation was taking on. now they're going to continue to

rise even when inflation looks to be abating a little bit we're still seeing a lot of demand for obvious reasons, consumers want cheaper power, and the only way to get cheaper power is to have a service like sunnova. >> yeah, certainly people noticing that in terms of utility costs. john, thanks very much appreciate the update. >> thank you let's check on the markets we are at new session lows the s&p 500 now off almost 1%, new low for the week we're back to levels on february 1st or so. the s&p down 9/10 of 1%, the nasdaq composite down 1% shares of tesla are up for the eighth straight session and have climbed in 14 of the last 15 trading days up next, details about the ntsb's review about a fatal crash that raised questions about tesla's autopilot system at the end of the day,

my mom raised three children, including myself. and so once the client knew that she was heard. we were able to help her move forward. your client won't care how much you know until they know how much you care. ♪ at morgan stanley, we see the world with the wonder of new eyes, ♪ helping you discover untapped possibilities and relentlessly working with you to make them real. ♪ because grit and vision working in lockstep ♪ puts you on the path to your full potential. ♪ conventional thinking delivers conventional results. at allspring, we break away with purpose. harnessing data-driven insights and boundless curiosity. we dissect the market from every angle.

helping to build portfolios that redefine what's possible. because investing isn't one size fits all. allspring. purposefully divergent. (clearing throat) what do you... got there? a hospital bill for me? mm-hmm. for $1,200? ga-a-a-ap! did you say "gap"? yeah, he did. he's talking about expenses that health insurance doesn't cover. ga-a-a-ap! uh-uh. aflac! that's why there's aflac. it pays you money to help close that gap. aflac, huh? don't tell me he high stepping. af-lac, af-lac! he stole my move! get help with expenses health insurance doesn't cover at... aflac! ...dot com. 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. welcome back to "closing bell." shares of tesla are rallying

today off their highs, adding to big gains on the year. the national transportation safety p board issuing a review of a fatal 2021 crash which had raised questions about tesla's autopilot system phil lebeau joins us now with the results of that. hey, phil. >> hey, mike, i remember when this crash happened. it was in april of 2021, just outside of houston, and the reason this got so much attention is because this was a model s that had crashed at a high speed, and at the time the police who responded at the scene said, look, there's nobody in the front seat. immediately people started thinking, well, were they trying to test out autopilot system, et cetera. that got the ntsb involved here. today they ruled that the autopilot system was not the cause of the crash it wasn't engaged at the time. there were other factors including high speed, the condition of the driver. for ntsb chair jennifer homandy, the significance of this is she has long been critical of tesla's marketing of its full self-driving technology.

this was not an investigation of tesla's full self-driving technology, but a lot of people have said does jennifer homendy have a problem with tesla and its autopilot ystem. this investigation was just about this one crash, but it makes it very clear that in this case when there was a lot of speculation, mike, back at that time that perhaps the drivers had engaged autopilot, that was not the case here so this clears one of those questions that had been out there i think for a long time people sat there and said, look, it doesn't strike me as being an autopay lot accident now it's been clear by the ntsb. ntsb reviews accidents, makes recommendations, mtsa, which is the government agency that regulates technology and vehicles, that's a separate entity they are thfinvestigating tesla autopilot system in a number of incidents. >> yeah, and again, the marketing of that system i guess also under question. thanks a lot i appreciate it. jpmorgan's ceo jamie dimon

warning it is too early to declare victory against inflation. up next, a top economist tells us whether he agrees with dimon's assessment the first time you made a sale online was also the first time you heard of a town named... dinosaur? we just got an order from a dinosaur, colorado. start an easy to build, powerful website for free with a partner that always puts you first. godaddy. tools and support for every small business first.

indexes sliding to session lows you see the dow down 328, almost

1%, the s&p 500 is now down more than 1%, also the lows for the week going back to levels seen last week right before jay powell spoke and helped the market rally for a time. in today's big picture, is it too early to declare victory against inflation? well, jamie dimon certainly thinks so telling reuters as much in a new interview and saying the fed could raise rates above 5% and keep them there for some time. the comment from the jpmorgan ceo comes less than a week before we get january's cpi numbers, but a couple of data points are giving a sneak peek about what to expect in certain areas in coming weeks and months orange juice futures hitting all time highs of 265 cents per pound. futures are up nearly 84% from a year ago orange groves in florida are still recovering from hurricane ian. the department of agriculture predicts the state's crops will plunge 56% this season because of the damage, but some relief

may come from consumers, pepsi saying today it is not planning to raise prices again this year for its sodas and snacks another bright spot, wholesale egg prices, which had been soaring, of course, they've now fallen more than 50% from the december highs according to data from market research firm earner bare are our next guest says it could be energy prices that could be the wild card in next week's headline. >> joining is michael gapen, may cal, good to see you >> thanks for having me on >> so you fine tune your forecast for cpi next week we have seen an uptick in month over month energy prices how is that going to feed through to the final numbers >> that's exactly right. we project energy within cpi will be up 2% on the month in january. that's largely a response to the upward movement in gasoline prices we think that means the headline rate of cpi will rise 4/10 of a

percent on the month or 6.1 year on year. so that'd be an acceleration on the month on month pace. we do think energy will add to a fairly solid inflation report in january. >> and so where do you come down on the question of whether we really do have downside momentum in inflation in other words, can we start to project ahead in coming months that it's going to be somewhere close or within range of say the fed's target area, or is it going to get sticky at some point? >> we're of the view certainly that we've passed the peak in inflation, and year on year rates of headline are likely to continue to move lower we would suggest caution in terms of saying the battle is won because right now most of the disinflation, it's narrowly driven it's almost all coming from goods like new cars and used cars and household appliances and so forth it has not yet reached services. so you need a broader based slowing in inflation to make us

comfortable that inflation will be more say consistently back to 2% and services, historically is sticky i think it's too early to say we're out of the woods, but we're moving in the right direction. >> right, and of course fed chair powell has been pointing to i guess services, we know there's a big lag in the shelter readings i guess the question is whether, you know, the job market really has to weaken up very much or you have to have wage growth really come down a lot more beyond what already has happened in order to be confident that services inflation is going to calm tdown as well that seems to be the big question that the market was recently feeling better about that maybe the fed didn't feel like they had to get unemployment much harder but now i suppose it's still a question. >> it is an open question. we come down on the side of thinking we probably do need some softness in labor market conditions in order to get the fed fully comfortable that inflation will return to 2%. you're right, it's an open

question the labor market is extraordinarily strong we added 4.8 million jobs last year the unemployment rate is at five decade lows. so that certainly is contributing to the high rates of inflation we're seeing currently. >> and then, you know, the folks who are very confident that a recession waits for us somewhere in the next several months keep pointing to these indicators that have rarely failed. the leading economic indicators, the ism, the yield curve all that taken together, does it tell the story that we're pretty much beyond the point of hoping to avert a recession >> i don't think so. we are in the camp where we're -- we think it's more likely than not we will see a slowdown in the economy, broadly consistent with a mild recession. that does kind of fit our view that to get inflation down to two, you need to remove some of the imbalances in the labor market i don't think it's a done deal i would caution against over reading one or two specific

recession indicators and say it's done. household balance sheets are pretty strong. the labor market is strong there's momentum in the economy right now, resilience is more the word than a slowdown so i wouldn't get too far out in front of that right now. >> yeah, somewhat reassuring, yes, the balance sheet story for sure michael, good to talk to you thanks so much michael gapen b of a. here's are things stand in the markets. you have the dow down just under 300 points, the s&p off 1%, nasdaq composite down 1.1 and the russell down a percent and a half the s&p 500 is up by roughly 7% so far this year coming up, cantor fitzgerald's eric johnston kes mathe case for why this could just be another bear market rally.

i was born here, i'm from here, and i'm never leaving here. i'm a new york hotel. yeah, i'm tall - 563 feet 2 inches. i'm on top of the world. i'm looking for someone who needs a weekend in the city, who likes being in the middle of it all. you hungry? i know a place, and a few others nearby. it's the city that never sleeps. but hey, if you need a last-minute spot, i got you covered. you'll always remember buying your first car. but the things that last a lifetime like happiness, love and confidence... you can't buy those. but you can invest in them. at t. rowe price, our strategic investing approach can help you build the future you imagine.

let's check out today's stealth mover, borgwarner, the auto parts supplier is one of the top performers in the s&p 500 after beating earnings estimates and forecasting its ev business revenue will rev up by at least 72% this year, stock up 2.5% disney shares are now in the red despite beating earnings estimates and nelson peltz e ending his proxy fight omat story, plus more ai fallout fr alphabet, and what to expect from paypal's earnings when we take you inside the market zone. so i moved to sofi checking and savings. get up to 3.75% interest, and earn up to $250 when you set up direct deposit. sofi. get your money right.

rail vision is at the forefront when you set up direct deposit. of an evolution in train safety. using advanced sensors, ai and big data technologies rail vision is taking rail into the future, making it safer and more efficient, reducing railway accidents and downtime saving lives and money. billions of dollars are expected to be invested in rail safety in the coming years. rail vision has the solution today. learn more at rvsvinfo.com. rail vision is at the forefront

i screwed up. mhm. i got us t-mobile home internet. now cell phone users have priority over us. and your marriage survived that? you can almost feel the drag when people walk by with their phones. oh i can't hear you... you're froze-- ladies, please! you put it on airplane mode when you pass our house. i was trying to work. we're workin' it too. yeah! work it girl! woo! i want to hear you say it out loud. well, i could switch us to xfinity. those smiles. that's why i do what i do. that and the paycheck.

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.

we are now in the "closing bell" market zone, cantor fitzgerald's eric johnston is here to break down crucial moments of the trading day and kate rooney on paypal. let's first dig into today's market moves, got the s&p down almost 1%, eric, you've not been a believer in this rally for a while now. you have had some other skeptics have been kind of won over by some of the characteristics of this year's rally such as the breadth of the market, the fact that we have this positive midterm election cycle we're sort of shaking off some fed speak in a way we hadn't last year. why do you still believe we are headed perhaps to new lows

>> so our conviction is extrext extremely high right now, and some of the sentiment positioning factors that are going on right now are actually at a very important inflection point. so over the past five weeks we've seen a massive change in the positioning dynamic from institutions cta's are now max long in the 95th percentile, hedge funds have covered a significant amount of shorts over the last five weeks bringing their net exposure up, and mutual funds have reduced their cash levels and while that's happened, sentiment has also significantly improved the bull bear index is at a 14-month high, and overall people are talking about a soft landing becoming much more likely based on the payroll report now you have these dynamics where positioning is such that when we move lower, there is now going to be a lot more supply that is going to need to come to

the market, and we think that's going to happen because the fundamental backdrop in some ways is the same and in some ways has gotten -- has gotten worse. >> in what sense has the fundamental backdrop gotten worse if, in fact, there are some clues that there's a little more resilience in the underlying economy than we might have thought >> sure, so if you look at where we are today, for example, versus where we were on october 12th when -- of '22 when the s&p was at 3577, the lows, the two-year yield at the time was 2.29%. it's now 2.5%. the peak fed funds rate at the time was expected to be 4.6 of %. it's now predicted to be 5.15% the fed balance sheet is $3 billion smaller than it was then, and the earnings estimate then were $235 for the s&p they're now 221 and continuing to fall and we don't see, you know, the payroll report is giving people a lot of hope.

the labor market right now is very strong, okay? but that's not a predictor around what the labor market's going to look like in three, six, or nine months. we are at the peak of the cycle, right? by definition with an unemployment rate where we are at a full labor force. that is the peak of the cycle. as we know, before every recession, as an example, march of 2000 payrolls were 473,000. that was a three-year high, and the unemployment rate was at a 30-year low. so everything feels good from a labor perspective before a recession, but all these other indicators, whether it be rates, leading economic indicators, the yield curve all suggest that that is going to change going forward in the future. >> that is true. al though the s&p was at a peak when jobs were peaking in march of 2000. we did get a 25% drop. appreciate you coming on to freshen up your view today.

>> absolutely. thanks, mike. >> let's get another check on disney turning negative on the day, better than expected earnings, restructuring plans, and an abandoned activist push from nelson peltz had pushed the stock higher earlier in the day. reinstated ceo bob iger discussed with cnbc earlier the recovery from the pandemic and potential plans for a dividend >> we're still recovering from that, and we're still obviously losing money on streaming, and obviously that's one of the reasons we have to turn that around as we said on the call yesterday, we're going to get to a point where we're going to recommend to the board of dividends at the end of the year, that suggests some confidence in our cash flow directory and how we not only generate capital but how we allocate capital >> martin crockett just upped his price target on disney to 129 from 120 and reiterated a buy rating he joins us now. barton, i guess first off, you read on the market action today, is there a rethink of the reorganization, of the strategy

that was laid out by bob iger or do you feel as if the stock's just up a lot in the past couple of months and it's giving some back >> well, i think there's part of that i don't know if there's people who follow on with nelson peltz when he's moving in and now that he's activist, maybe some people are selling around that. you know, that would be speculation. i do think that your previous guest was saying, there is a lot of kind of concern, i think, broadly around the markets so i think the market's not -- disney either. >> and when it comes to disney specifically and the plans that were laid out, the magnitude of cost savings that are going to be targeted and things like that where does that get you? i mean 129 as an upside target certainly is well below where this thing traded in the past couple of years. do you feel there's some valuation headwinds at this point? >> i think that you're just taking this company and rebuilding it from the ground up so the good thing about disney

relative to the other media conglomerates is that they have theme parks and their theme parks are huge contributor doing great, that's something they have that the other media companies don't. they are like the other media companies going through this process of acceptance, of pay tv as a business that's in decline and perpetuity and hopefulness that the direct to consumer streaming can offset that. that's going to be a tough road. what we see here is that the cost cuts are necessary to rebalance those two. i think they could pull it off but you know, there's clearly going to be a lot of wood to chop to right balance the expenses relative to the normalized revenues andit's a business that's in transition. i think there's some question about where it settles out i think it will work, but i don't want to get over my skis. >> on the streaming side of things, is there risk in terms of cutting content spend too

much i know everybody in the industry pretty much is trying to cut back, but i just wonder if we know the right level or the sufficient level to keep subscribership strong. >> no doubt they have some numbers that will tell them that their franchises work, and if they lean in on those and cut back on some of the less franchise kind of general entertainment that, you know, that there's a decent trade in terms of engagement. do we know exactly how much you need to spend to be competitive? no is this a great setup for net netflix, you know, with all the competitors pulling back yes. but you need to right size this is the moment where we need to grow up, we need to make money in these businesses, so what disney's doing is the right decision, and we're going to have to count on them to manage the revenue and the expenses to an ebquilibrium that makes sens. i'm glad they're moving in that direction with the cost cuts. >> as they also cease disclosing

subscribership, maybe that's going to take a little bit of the pressure off thanks a lot thanks for checking in on disney today. alphabet selling off for a second straight day in response to its artificial intelligence chat bot making an error during an event on wednesday. google's bard was championed as competition to microsoft's own push clearly there was disappointment about the performance of that example of what the ai search could do, but to me there's also tremendous amount of renewed focus on the vulnerability of google search margins with the aggressiveness that microsoft is showing right now. >> and a vulnerability that investors far or a long time di' even think it was there. that demo was part of a very messy rollout which made it look like google, which is supposed to be an ai first company reactive there was an ai event and the

day before we heard so much enthusiasm from satya nadella, the microsoft ceo. so a lot of this is making investors question who is going to lead this next leg. i mean, we've certainly been hear befo here before in terms of threats to google search maybe not as existential back in 2010, bing and facebook were going to partner to take down google. that didn't materialize. the question is is more at stake here is this the biggest platform shift since the iphone, since google's search itself that's what's playing out in markets right now. investors think that alphabet is vulnerable. >> they certain ly do. it's well over 100, $150 billion in market cap. very dramatic rethinking of that business thank you so much. paypal is one of the big names set to report earnings after the bell kate rooney looks at the key number to watch for. >> paypal investors want to hear how this company is navigating a challenging macro environment. payment volume is kpey

it's expected to come in around $360 billion watch commentary around competition and user growth. there's been fears around apple pay eating into venmo's market share. paypal announced last week it was conduct about 7% of its work force. finally, strength of the consumer ceo dan schulman talked about people pulling back discretionary spending in the last quarter and paypal could really be another window into the health of the consumer right now. back to you, mike. >> i'm sure it will be, kate we'll talk to you very soon, as soon as those numbers come out the market's right now set up for a down close, though the s&p 500 a bit up off the lows, down about 9/10 of 1% it is below that 4,100 mark. market breadth has been negative all day. you have seen a turn about in the nasdaq that was a point of strength, and now outside of tesla, you have mostly profit taking in that index as well you see it down about 1% on the

day. we are still above where we traded early last week in the s&p 500, so we're still kind of hovering not too far below those recent highs the vix is above 20 again. it seems as if investors are worrying we've lost some upside momentum with this rally attempt, as well as bracing for that cpi release that comes on tuesday. that is going to do it for "closing bell. now back over to "overtime" with scott wapner thank you very much, and welcome to "overtime." i'm scott wapner you just heard the bells we're just getting started here at the new york stock exchange we have more earnings imminent, paypal, aexpedia and lyft we of course will show you the stock moves as they happen star analyst dan ives is waiting in the wings as well to tell us whether ride sharing is a winner take most business with uber shares the best way to play it we shall see we begin with our talk of the tape, to