tried it, and got hurt in the process. >> accidents >> absolutely. check of the markets here. we're seeing them lower. the dow jones is off 80 points or about a quarter of a percent because of the stalled debt talks. >> good to have you here >> you too >> have a nice weekend thanks for watching "power lunch. >> "closing bell" starts right now. thanks welcome to "closing bell." i'm scott wapner here at the stock exchange former fed vice chair terrricha clarida is with us this make or break hour begins with more debt deal uncertainty, and it is weighing on the markets yet again today. were the republicans negotiators called to pause in those talks and that's pretty much where they have been the s&p coming off the tightest close of the year, sitting at that 4,200 level for most of the day.

just blelow it as you see nike following that cautious guidance from footlocker having the worst day ever after disappointed investors the nasdaq taking a breather too as alphabet and meta bring two-week highs that's the talk of the tape. whether we're about to break up or break down. let's ask the hedge fund head of goldman sachs with me once again on-set >> good to be with you, scott. >> i thought we were about to break out of this range. the headline on the debt ceiling duel what's your outlook right row? >> we walked into the office on wednesday, and the six-week trade range was the tightest in five years less than 3% >> yep >> we've obviously teased up towards the very upper end of that range around 4,200, as someone who's been in the camp, the collar feels a little tight at 4,200, but we've seen this level four or five times and it's held every single time. >> mm-hmm. >> i'm a believer it probably

does still hold, but i think the good discipline would be to lighten up a little bit on your risk at this end of the range, and i tend to believe if i look at nasdaq in particular, which has performed masterfully. >> we talked about it virtually every day this week, and for good reason because it's outperformed and there's so much hype around the hope for ai, and it's so overstretched to a point where it's going to have a pullback. >> i think fundamentally there's still a lot to like, of course i think we saw this in q1 earnings 5 for 5 with magna. >> mm-hmm. >> they beat expectations, and buyback, coupled with that issue last week. they're all running plays very few companies can run. that said, a look at yesterday the rsi and nasdaq pushes about 70 we have the largest one-day call option volume in nine years, and it feels a little bit short-term extended to me, although it's probably still the best in town. >> okay. so given your hedge fund client

coverage, right? you have a really unique window into where the biggest and alleged smart money is placing its collective we learned from the 13 fs that you're getting a big lean into ai and mega-caps steve cohen was speaking at an event, and it was reported from those in the room, he's bullish on the market. one of the reasons is ai is your client base by and large growing more -- i don't know, optimistic on the market >> a little bit. i think the general posture of the trading community coming into this week was actually very defensive. i would have said this a couple of months ago as well. goldman sachs the brokerage data, always a good kind of reveal of what they have on. net exposure length was in the bottom of a lookback when i look at s&p 500 features and i reminded myself they trade as much in dollars as the entire cash equity market, and that was near a record max short. so i think in general,

risk-taking had been very defensive. i think there's anyplace place where people had been pushing a few chips forward, it would be those mega-tech names that picked up that day i buzzed. >> toes are getting back in the water, that's fair to say? no one's jumping in? >> i think that's right, you know, we've constructed a basket of the perceived beneficiaries of ai winners. it's early, and i think it's kind of still rough work in this process, but what's so instructive is the reality is the perceived winners, the googles, the microsofts, the nvidias, they carry the bulk of the index weight, and i think this has been a very material tail wind for the s&p 500 in general. >> do you think this is done this week was interesting because you had a couple of different fed speakers, bullard and logan suggest, maybe we're not done maybe we need some insurance so to speak, and the fed chair today, he certainly didn't seem necessarily as though he was on the same page. the hawkish page as they were. >> walking into this week, i

would have said we think they're done as a formal kind of view as the house. the interest rate trip thought they were done most fed commentary -- i think there's 19 occurrences of fed commentary a lot of it felt to me like they were trying to keep their options open a lot's going to happen between now and june we have another payroll number we'll have a cpi number. presumably resolution with the debt ceiling and of course, kind of still the openness of the regional banking i think they'll wait on as many banking pitchies as they can at the start of the week, you would say, the fed may or may not this summer, but the pause is probably in come september, they're going to hike once a meeting for eight straight meetings which is a year in realtime, and the rate at the end of next year will be 3% that's a very kind of tidy profile of a soft landing. i don't think that was lost on the stock market i think that's part of the, you know, the strength we've seen in tech >> is the risk that the fed is going to be more aggressive than

the market, not only is priced for, but that investors expect because you know where the market has been placing its bets as you said, the narrative was, okay june's done. is it live or not? that would seem to me to be a good place to talk about where the risks lie. >> i think if one were to articulate the bearish narrative, it's where you start. wages are still growing more than 5%. historically, it would be an unusual place to pause so again, i think we have to wait and see how a few of these other events play out, but i think it's a risk that was reintroduced to the market's mind a little bit. >> you held a family office event recently i know because i know people who were there is there a difference in the way that family offices are approaching the market now versus just pure hedge funds >> i think there's an immense difference we have been sapending more tim with the family office community. i'm glad we have

there's an enormous amount of muscle and an enormous amount of fire power we did a survey early they are year 166 families and 75% of those are north of a billion dollars steve weiss was there, and had good things to say good to have him in the house. >> that's my mole in the room. he outed himself, so now you did anyway >> we'll take it he was polite. we'll take it. they said they have a meaningful allocation of cash, and 35% intended to deploy that cash to public equitequities, private ey private credit very much on the front foot of capital, and can essentially make moves no other investor type can >> i would think by a class of investors, it would be a bit more cautious than your typical hedge fund i mean, in some cases you have, you know, people bwho used to ru hedge funds who are running family offices maybe their -- their client base is not what it was, so maybe

they're thinking about the risk curve. >> there's that segment of family offices i used to run a hedge fund, and now i run family office money, and i run it a very similar way, and there's kind of everyone else there's the big american families who continue to have operated businesses and have done very well in the past three or four years, and continue to generate cash flow here's what's so interesting if you look at their waiting -- they have allocation alternatives and a 45% wait. private equity, credit, and maybe a professional sporting team that's, like, 2x, an ultrahigh network, and they're very much on the front foot. >> good to catch up with you thanks >> thanks, guys. >> goldman sachs, global head of hedge fund finalists let's get to our twitter question of the day. we want know if you think there's a bubble of in ai stocks let's get top stocks to watch as we head into the close. kristina is here now with that

kristina >> let's start with footlocker shares because they are plummeting right now after posting its biggest earnings miss in three years. revenues, sales that was a solid disappointment year over year leading to lower guidance. the stock is down 27% right now, but the ceo said promotions and a drop in discretionary spending hurt their bottom line listen in. >> we skew more middle and lower income where the pressure is higher the facts and the math is pressure will be different depending on the level of income. >> footlocker does apply lowering cost to shoppers. the luxury fashion online platform did post higher than expected revenues. sales volume continued to grow in the united states and china, representing strong demand for high-end goods even as consumers pull back on spending. the stock is up almost 19% right now. scott? >> kristina, thank you sticking with consumer names, our next guest says the key for investing in them is to

stay selective let's bring in i havery sheffie. >> good to see you, scott. >> this is interesting for retail the way that footlocker is trading and overshadowing everything today how do you view it now >> right so, you know, i like to be optimistic about the consumer. i think the consumer is an increasingly tough spot, and we've seen multiple data points through the week certainly this morning, and actually -- and previous reports even at the higher end of reports by companies like canada goose, like burberry, a showing that the u.s. consumer at both the higher end and the lower end is struggling more >> are you by and large worried about the consumer enough to say, you know what maybe it's too hard to be too selective? so why bother? >> right so we're watching very closely i am -- yeah

i think -- it's not why bother you want to be a prepared mind what we're doing is spending a lot of time looking at companies, not just the companies that you know are going to sail through this fine, right? walmart is an expensive sptock, but the stock's not up tjmaxx, but looking at the companies that are more beaten up, and likely -- that have the potential to really outperform, and have enough going for them that they can surprise us to the upside, that's where there will be opportunities, but the pressure on the consumer looks to be accelerating, not decelerating so i think being a prepared mind is potentially in the best place to be as well. >> i'll ask you a question because on a day like today, i look at footlocker and they've got their issues and it's talking about bloated inventory, and you have to talk about markdowns and more of them, and you look at nike is down in 4% in sympathy with that. do i need to think differently about the nikes of the world if i'm worried about the

footlockers of the world >> i would think differently about some of the expensive, great brands that are cyclical we did see with under armour's earnings, not perceived to be the -- have the same brand strength as nnike, but we didn' have data points on largest footwear company in the world, and it's hard to imagine that given that footlocker has, you know, 65% of their sales from them that they might not experience pressure too, and then the question of course, with all of these big brands is how is china going to do how is europe going to do? >> sure. >> if there's weakness there, there's room for multiple compression. >> are you reassessing as it comes to retail? the rebound from china has been weaker i think than some thought. particularly from a travel retail standpoint, ight? >> yes >> estee lauder comes to mind, thinking now differently >> yes so i have been more cautious on the china rebound myself i think it's been -- there have been a lot of differences across brands, right?

so companies that had -- that both produced too much inventory themselves here or had customers that bought a lot of inventory, and they were expect a strong rebound, they're struggling. those that managed their inventory more tightly look like they have decent results in china. you have to look brand by brand, and their inventory levels in the previous quarter to know, you know, where i'm going to continue to see benefit. >> you buying this ai move how do you think about it? is it a bubble you're laughing. i mean -- why are you laughing why are you laughing >> i'm laughing because it seems very bubble-like, but the bubble keeps growing, right it does seem like dot com. it seems like bitcoin, and as soon as it came out, i asked the ceo of every company i was speaking to. so tell me about your investments in ai. they said, oh yeah we have been investing in ai for years. is your cap expected to change not really maybe a little bit on the

margins. it seemed more incremental rather than revolutionary. certainly companies are going to be spending more money on it, and you are hearing about incredible demand for the chips, but will that materialize into the revenue and earnings expectations people are thinking over the next five to ten years? i think that's going to potentially be tougher, but what's going to stop it? i don't know because demand is accelerating it's just -- i'm not seeing enough use cases that suggest there's going to be enough investment to justify the current valuations, and also what's interesting at a chip level is you are seeing the primary purchasers of ai put out announcement after announcement about their own internal initiatives that they think are going to actually be better than the dominant players' chips over time, and that suggests there won't be a monopoly and spending might be lower than anticipated due to cost efficiencies. >> but it makes you pause if nothing else and say it feels a little reminiscent of that early run up in some of the stocks even though lets be clear, and we showed this earlier in the

week the valuation gap between then and now is extraordinary extraordinary. >> yes >> in the early days of the internet leadership stocks, if you look at those, i don't need to mention, and people remember what they are, and how crazy the valuations got. >> yes >> is microsoft at 30-whatever times earnings is not nearly as egregious as something like that >> right >> maybe in a current environment. just relative to, you know, where rates are, and what the trajectory for that -- and the economy, i can see that argument. >> look. microsoft might be an expensive stock, but microsoft's not a stock that's going to fall off a cliff. they've got a lot of good things going for them, and ai is going to be value for them it's a question of what multipl you want to pay when interest rates are 5.5% >> avery, i appreciate it. we'll see you soon. >> my pleasure we're just getting started here on "closing bell" on this friday up next, tech's transformational moment the hype surrounding ai sending that sector higher as you know dan ives joins us with hi

forecast he's just back from two weeks of checks in asia he's going to tell us what he saw on every stop he made, and later, what's next for the fed former vice chair richard clarida gives his first reaction to chair powell's comments on inflation early today. that's ahead you're watching "closing bell" on cnbc. there are some things that go better... together. burger and fries... soup and salad. like your workplace benefits and retirement savings. with voya, considering all your financial choices together can help you make smarter decisions. voya. well planned. well invested. well protected.

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rally in big tech, but is the mega-cap momentum and investor sentiment getting ahead of itself at this point let's bring in dan ives. he's here post nine. it's good to see you again just back from two weeks of stops in asia checking on everything that's going on in tech right now what did you learn what was the biggest takeaway you got? >> i think from an investor perspective, i think a star contrast i've seen in the last few years, appetite for u.s. tech, how do you play the winners? how do you actually see more and more from china tech to u.s. tech, and from a supply chain perspective, stabilization i think that's the biggest thing, spervcifically whit comes to apple and semis, and i walked away from that even more bullish on tech, and here's what we see from a demand perspective. >> do you have a hard time even as bullish as you are justifying some of the moves in the stocks that we've seen? and if not, why not? >> look. i get that many people think, all right.

can this be crypto, metaverse, and all ai in tech, it's probably the most transformational tech theme that i've seen. in terms of an opportunity, and i'm not saying in the next year or necessarily the modernization is going to be there to justify these moves, but when you look at microsoft in terms of what's happening, and you look at nvidia, google and others, this is based on our estimates, an $800 billion over the next decade. >> how do you get that number? every time we're trying -- we're in a moment in time where we try and justify a stock move or a group of stocks, and their move, we use things like total adjustable market and we come up with whatever number sounds amazing to us to try and justify that >> sure. >> where does that number come from >> i've talked to you about it before from what we're hearing from the field in terms of cloud partners, from microsoft across the board, for every $100 of cloud spend, $35 to $40 of

incremental could be ai, and that's when you start to trajectory that out. that's why the hype's there, because that's when jassy, and everyone will go after it in terms of opportunity this is not hype this is a real monetization opportunity, and it's a real winner, and this is why i think this is different than other themes we have seen. >> it's an arms race, right? an arms race means that you are going to spend a lot in the beginning to try and load up your arsenal, right? to be able to rule whatever world you want to rule, but the payoff, that's unknown in terms of the time frame. when's the roi on in all the stuff we're seeing in the return on investment that we're seeing now that's going towards ai. >> i think, and this is a big theme across asia. the investors are wondering,

when is the monetization, and especially with microsoft and cloud, i think we start to get there by the end of this year. i believe monetization and ai will be on cloud a lot sooner than expected, which is why, you know, with a lot of these names that continue to move higher, i get the skeptics, but what i believe is that it's this fourth industrial revolution that's playing out. jump ball is going on from a fed perspective. i think this is different. i really view that it's sort of a golden age for ai, and that's why everyone is trying to figure out. if it's not just microsoft and nvidia, how does google benefit? sale salesforce, and i think others -- there's going to be losers too that's what everyone is trying to figure out in terms of this ai field >> i remember way back when, watching documentaries and television, news programs called, you know, the new gold rush same kind of stuff you're talking about relative to the internet is how people are referring to ai now. i get it

i think everybody kind of gets it, but does that necessarily justify these near-term moves and some of the valuations that we now have in some of these stocks >> i think for some it does. i think microsoft is a good example where if they can really moneyize ai relative to cloud, they have a 4 in front of it, and they alter some of the parts. others, they obviously have to prove it, but i think that's why right now i don't believe it's hype because i do believe the monetization theme is probably as real as anything i've seen since the late '90s. >> thanks. that's dan ives joining us here. up next, the former federal reserve vice chair, richard cla clarida, he breaks down his forecast now for interest rates. we'll get his take on the probability of a june hike, what n' could mean for the economy. dot go anywhere. "closing bell" with that big interview is next.

at pnc bank, you can find us in big cities and small towns across the us, where our focus is to always support the people who live and work there. because you call these communities home, and we do too. pnc bank. fed chair jerome powell

signaling today that stresses in the banking sector may mean interest rates won't have to go as high as expected to curb inflation. what does this mean for the fed's road ahead let's bring in richard clarida he's the former fed vice chair it's good to see you again welcome. >> thank you >> so powell today said we've come a long way, our stance is restrictive. might not have to take rates as high because of credit tightening from the banks. are they done for the time being? >> i think that they've certainly paused time being, yes. let's agree. i don't think they want to declare victory. it's not mission accomplished. inflation is too high, but this is a very similar message we got out of the press conference a couple of weeks ago. i think that's what the chair wanted to convey, that they're going to pause at the june meeting certainly, and probably in july. >> i chose my words carefully in the way i asked you that question, you know, for a reason for the time being, but what you just said is very interesting to

me, and that, you know, june, okay, but you think they may pause in july as well? >> that would be my guess. that would be my guess now they are data-dependent. they've gotten off what some folks have called the hamster wheel of hiking at every meeting or if they at least pause in june, they will have gotten off the wheel. i take the chair at his words. they are restrisctive. there are lags they want to be looking at the incoming data. you know, you have some hawkish members on the committee, lori logan and some others, and so i think it's going to be a robust discussion, but i think the center of gravity now is that we have a pause, most likely for the summer >> but what do i do though with the hawkish, you know, speak that we got this week? you know, it was logan and then even bullard saying, quote, it may warrant taking out some insurance by raising rates somewhat more.

echoing what, you know, logan said and as you suggested, some others what am i supposed to do with that >> well, i think part of what's going on here is, and we've talked about it before on your show, and i've written about it. there has been a tug of war between fed messaging and market pricing. you know, just five, ten days ago, the markets were pricing in a high likelihood of a cut in july and a slam-dunk of a cut in september. that's all been taken out. right now the market pricing is if there is a cut, it would be at november, and i don't think they're unhappy with that. so part of what's going on here is not so much trying to tee up a hike at the next meeting it's trying to hit the markets away from teeing in imminent rate cuts. >> you think that's really what bullard and logan were after, is to try and get the market to move away from this idea that we're going to cut any time soon >> exactly i mean, i think also, you know, i respect them both. i know them both i've worked with them, and i

think that they do think probably the fed will do more, but right now, you know, the chair doesn't want to go that far, and at minimum, their fed speak has i think, done something the fed wants which is to take out some rate cuts they don't think are going to happen imminently >> do you think that chair powell is a little more worried about prospective banking issues propping up, you know, here and there than some of the other fed members are? >> i'm not sure about that, but he did emphasize it, and obviously the chair, i worked with him closely the chair does choose his words, and he could have chosen not to emphasize that so yes certainly if i were back in the building, it would be on my mind as well. again, you know, the banking system as a whole is sound, but, you know, there are challenges in several banks, and i think he wants to certainly avoid appearing to be relaxed about that so i think this is the wise course >> and to be clear as our steve liesman noted well earlier, these were not off the cuff

remarks that were made today by the chair. he repeatedly referred to, you know, either notes or a script or however he wanted to make sure that his words were clearly said, and that the market clearly got the message, right >> oh, absolutely. look anyone who watched the video can see this, and that's not new the chair has notes at press conferences and testimony, but yes. certainly, even though this was a, you know, far-side chat segment, powell always came prepared. >> what would cause them to cut, mr. clarida? if, you know, let's say the economy doesn't necessarily have to fall off cliff, does it, for them to cut? inflation could come down much faster than the fed maybe expects that it will what's the difference maker here >> yeah, you know, the reality is except for a couple of months in november and december, most

of the inflation news this year has been either as expected or worse than expected, but look. we're going to start to get relief on headline inflation as the housing market is turned and rental inflation drops down, and so yes if inflation comes down faster than they and the markets expect, and it looks to be persistent and returning towards target, then it could cut sooner they could also cut sooner if we get a sharper cut in the economy, and that will lower inflation pressure. >> when do you think the first cut comes? you must be in your current role, kind of thinking about that, talking about it with colleagues, gaming it out for people because you have been in the room when does it come? >> yeah. well, i have been pushing back against the idea it would be this summer or september as we move through the year, if they start to get better news on inflation, remember they have cuts pencilled in or written

down for the projections in 2024 so i can certainly see if the data breaks their way, then entertaining, you know, the conversation about cuts, you know, in the november or december meeting to tee it up for tnext year, but i would be surprised to see it before they seem unified in their public comments that part of the plan is to keep the rates at a restrictive level for some time. i think the hurdle is pretty high near-term to cut. >> i'm also wondering, everything to this point has been unanimous what impact would there be if in june there were dissents even if it was just one? >> well, of course, there can and certainly during my time during vase ice chair, we had dissents to be quite frank for your viewers, i don't think it makes that much of a difference. we're going to get the monetary policy that jay powell things that the economy needs jay powell is not going to make

a decision he doesn't want to make because of a potential dissent. but obviously the dissent will convey information about where the committee sees the risk. it would be informative when we get it, but i don't think that would change a decision. >> there wouldn't be a broader y issue if there was a fractured fed? the mere fact what was unanimous is no longer as we move into one of the more uncertain stages of this new regime from the fed >> i think it would depend on what the communication was, but certainly the chair could either through his own remarks or through people on the committee representing his views could convey the message obviously if the committee went radio silence after his dissent, that would reduce it the fed had three dissents over the rate adjustments in the

summer and fall, and it's not great, but the direction the chair wanted to go i don't think it would be a decisive, but it would introduce some uncertainty and some communications challenges. >> are you surprised by how resilient the economy and labor market have both been, and do you think the fed chair himself is >> well, yeah. the labor market in particular i think is surprising most forecasters, and, you know, that's a good thing, you know, we have a record low unemployment rate , and i just saw a rate today that job satisfaction is higher there's a lot to like about this market, and wage pressures are excessive relative to the 2% inflation target so, you know, i think that's -- that's the way that they're processing it, but the labor market has been very robust. >> has it impacted in any way, your own feeling on whether you think a soft landing is achievable >> well, it has, actually. ironically, the stronger the

labor market is right now, and we haven't really seen, you know, striking relief and wage inflation. it's down from the peak, but it's still elevated. i think what that does mean is, you know, in order to get inflation down to 2 point something, we will have to look at how long that is delayed and. >> would you entertain in any way -- let's say we get inflation down close enough and we go on with our lives and the world is a better place, et cetera do you think they would actually have a conversation in the room about changing the target? >> well, sure. they can have that conversation. the chair's been pretty clear that he would be against it. i think the challenge right now is that if they were to change the target, obviously to raise it, they wouldn't lower it if they were to raise the

inflation target, you know, what it would do is it would push out bond yields, and it would be very disruptive, not only in financial markets, but into the real economy the bond market now for all the challenges and the twists and turns post-pandemic, the bond market thinks the powell fed will get inflation down to 2-point-something over the next several years, and if they were to change that, what we would see is we oftentimes see an emerging economy and immediately the markets start to price in another devaluation. you can make a case that several, you know, decades ago, the fed and other central banks could have picked a different target, but they didn't. so i don't think it -- certainly they can discuss it. i don't think it's likely that they'll pull the trigger and do it though. >> the other thing i'm thinking of too, though, it's a dual mandate. you have stable prices and full employment, and here we are every day talking about the transformational ai, and what that's going to mean

>> yeah. >> and i really do wonder how the fed is going to view all of that, the possible disruptions it may cause within the labor market, and whether it has to change its own methodology in the way that it sort of games out or thinks about the future of employment in this country. >> i think it's an excellent question it wasn't even on my radar screen a year and a half ago when i was there, and certainly now it is very important in the sense that, you know, you can see not just in 50 or 25 or 10, but in the next several years, scenarios where widespread adoption of these tools could lead todrastic changes in the demand for workers to wages to the income distributions so absolutely, you know, it's probably not on the front of the radar screen now, but it will be especially once we get on the other side of this inflation curve. >> shouldn't it be on the radar now? i mean, the danger of course, would be, like, sadly other things that have happened,

right? the fed has been late to react in certain instances, and this is one where you wouldn't want to have that happen. >> no. sure we're on the same page i'm saying i don't think it's going to change the decision for june or whatever >> oh, i'm sure. >> i wouldn't be surprised at all. the fed has a great team of staff economists and they probably do have a dedicated staff working on these scenarios right now. what makes this striking is a lot of technological -- revolutionary technologies require changes in work flows and capital stocks in order to be adopted, and this is something that depending upon your view could be adopted actually quite quickly the change could be quite accelerated. i'm sure they are looking into that. >> richard, i appreciate it so very much. always good to catch up with you. be well. >> thank you all right. that's rich clarida, former fed vice chair up next, we're tracking the biggest movers as we head into the close on this friday chr

kristina is back for that. >> we told you about footlocker and there's another name with concerns about high promotions and weak retail spending i'll have the details and more after this break what do you see on the horizon? uncertainty? or opportunity. whatever you see, at pgim we can help you rise to the challenges of today, when active investing and disciplined risk management are needed most. drawing on deep expertise across the world's public and private markets in pursuit of long-term returns... pgim. our investments

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about 15 minutes to go before the closing bell. kristina is looking at the closing stocks she's watching. kristina >> i want to start with drug maker catalent investors are buying into this name after they said they can sufficiently service customer demand and supply was healthy. a vote of to confidence for shareholders catalent has been stocking up

over 16% at this point shares of ulta beauty are trading lower after analysts at oppemheimer cut their prices from $575 from $600. they say there is limited upside in the stock, and are worried about excessive promotions eating into margins. they report next thursday, scott. >> thank you last chance to weigh in as well on our twitter question we asked, is there a bubble in ai stocks? head to @cnbcclosingbell on twitter. the results after this break we're here to fight the big, intimidating, impossible-to-change problems. [beeping] from developing treatments at unprecedented speed to addressing threats to global health. we're leading the way with a revolutionary mrna platform that could teach our bodies to do extraordinary things. we're here to do something more than make medicine. we're here to change it. moderna. this changes everything.

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well, speaking of one of the best performing so-called ai stocks is nvidia we're going to set you up for those results coming next week we're going to break down the key metrics you need to watch. that and more when we take you indeheart nesi t mkezo i was having relationship issues with my old bank.

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week mike, i turn to you first. 4,200, the line in the proverbial sand. >> yeah. >> we were there, and now we're not. >> yes >> we're not that far, but we're not. >> we're roughly there, at least in broad terms, at least enough for people who have been believing, and i think it's the prevailing opinion that it is something of a cap on the market to get you to rethink that, perhaps. multiple things could be true at once, and if you get into those scenarios, the leadership market looks overbought and overheated and it's time for a rest when that happens you've only seen the most tentative signs of a broadening out of this market yeah, semis are participating, but just barely had small caps to break down. you think it's still very contingent as we get through this expiration trade, and maybe get the net looser i have to say on a net basis for the weeks, most things were constructive because most things we were worried about didn't get worse, and the market responded to that.

the s&p is up for the week as i say, the russell finally bounced, and the regional banks, they put distance between the lows and where they're trading right now. >> i tell you what these mega-caps right now, they may be taking a breather, but, you know, apple today, we think it was alphabet, meta, you're talking about some pretty lofty levels now >> they are. so they've broadly speaking, all recaptured the crush they underwent last year. i was just looking microsoft, alphabet, and meta as well as nvidia over the last three months have had significant upside revisions to earnings it's not just -- i mean, mostly it's valuation because they have had monster stock moves, but they've seen their fundamental outlooks improve a little bit. meta a lot i think over three months, the earnings estimates are up by, like, 23%. so you have things that are at least no longer as much of a head wind which is peak valuations on peak earnings. that's how we got into this,

november of 2021, and it's much more they're look a little bit rich, but maybe we see a path for them to resume growth >> all right leslie picker, big move lower in regional banks, and i'm wondering if the fed chair's comments today have anything to do with reviving the worries about what's happening there >> it could be a little bit of that, scott. it could also be the cnbc report that came out earlier that did send at least the etfs lower some individual names as well saying that treasury secretary yellen would be open to consolidation as a way to kind of calm some of the bank stress that's out there that cnn report citing people familiar with the matter i have made several calls on this, and have not been yet able to confirm that reporting, but the market says essentially that things must be so bad that secretary yellen would be willing to allow for greater consolidation to take place in order to kind of stem the issues that are out there.

>> the fed chair, you know, was talking about more so along the lines of, well, you know, maybe rates don't have to go up as much because of potential credit issues with the banks. i mean, it just gets everybody kind of focused on that issue. not to mention the uncertainty on the debt ceiling and just the overall feel about more, you know, potential -- potentially sensitive areas of the market. >> yeah, they've definitely been reacting to the debt ceiling news largely on a positive basis this week any kind of development on that front or any positive headline they seem to be reacting to. there's also on the fundamental side of things, we saw western alliance post additional deposit increases this week. that kind of creates this feeling that maybe things are starting to stabilize at least from a deposit front and the customer concerned front, and there were those 13 f filings. you had berk sshire hathaway getting into capital one, and all of these things are kind of votes of confidence which helps

in the stock prices of these banks off of their lows as mike alluded to, but again today kind of whips back into the red on some macro headlines as well as, you know, the potential for things to be really bad out there. so bad that the treasury secretary would be willing to consider additional consolidation. >> good stuff, leslie. have a good weekend. kristina, nvidia >> yeah, wow. >> stocks have doubled this year alone. there's a lot to live up to this week. >> it's the main beneficiary of ai they want to hear all about the data centers and gpu sales and we have to think too, gaming is another major contribute tore a revenue. there could be weakness coming out of china, and we'll be looking at that. will there be supply glut? will there be issues getting chips? this name is trading at 29 times sales -- 182 times earnings.

this is an expensive name. a lot of people are expecting it to keep growing. so that's why, scott, guidance for this name. guidance is going to be so important to see where we're going with this ramp up in gpus. will there be enough who else is going to be buying it, and what are they going to do with their products are they going to continue to ramp up their orders with tsmc that's another name to pay close attention to out of this earnings report. >> and we will kristina, thank you. got to run because i have breaking news on the airlines. phil lebeau has that for me. >> the justice department has won its lawsuit to undo the northeast alliance that is the alliance that allows jetblue and american to essentially work in a co-share operation for their flights in new york and boston, and this was one of those suits that people were watching closely to see if the federal government would be successful in saying, oh, no we disagree with what was approved during the trump

administration, and there were a number of people who thought there was a good chance that jetblue and american would prevail, but again, the doj has won its antitrust suit this would undo the american airlines and jetblue alliance. i should point out that both jetblue and american have said in the past that if they were to lose this opinion from a court, that they would be abieppealing that decision. i would expect to see some type of appeal formed or filed soon jetblue, we've reached out, and we have not heard from them. american said they will have a comment likely later this afternoon. scott, back to you. >> phil lebeau, as we approach the close. we have less than 45 seconds to go now you know, retail, big week this week discretionary which we don't talk about nearly enough this is the third best performing sector of this year we have a lot of questions here, with footlocker and nike with the dow down 3%. >> it's apparel and chain stores that have been the worst of it

and discretionary. it's a matter of what you think that the homebuilder stocks are telling the consumer households that are in decent shape along with things like semis, but, you know, transports, retail it's not been a great story, but there's time for this rally to broaden out. >> good stuff. have a good weekend, mike. >> all of you have a good weekend as well. i'll see you on the other side of that. morgan and jon are in ot a down day, but an up week for stocks that's the stcorecard welcome to "closing bell overtime." i'm morgan brennan with jon fortt. coming up this hour, michael hsu joins us to talk about the latest drama in regional banks as janet yellen reportedly raises a red flag about the potential need for mergers. >> and we talk to sal khan about how artificial intelligence is changing the game for market companies. >> markets trading lower