>> yeah. a bidding war breaking out for a car that no one has yet. it is featured in the new magic the gathering came from hasbro, which is based on the lord of the rings series. it is an extremely hard-to-find card. >> precious. all right. thank you for watching "power lunch". we will see you at 4:00. welcome to "closing bell", live from the new york stock exchange, i am sara eisen. we have an exclusive cnbc story about a meltdown goldman sachs could be facing. we will have details, coming up. this make or break our begins with the check sector, nasdaq on track to break a win streak. text funds are seeing their largest outflows in 10 weeks. it leads us to our talk of the take.

he joins me here at poorest nine. good to see you. >> thank you for having me. is tech exuberance fading? it has been a strong run that nobody predicted, year to date, month to date, and now down on the week. >> not extreme, but every rainstorm has to begin with a single raindrop, if that is what you believe. >> so, this is a rainstorm? >> i'm not saying that, the saying is apropos. you have had a terrific run in many of those names, as many are aware, and 50 is up almost 200% year to date. the law of large numbers? in at some point, so it wouldn't be whether in retrospect or in the moment, out of the realm of possibility to argue that most of those games have been realized, and perhaps some giveback or at minimum, a pause wouldn't be out of step. >> you don't think that you should buy nvidia because ai is transformational and we are just getting going? >> i am making no comment on

whether anybody should buy nvidia, or not. i'm saying when a stock the size of nvidia is up to hundred percent for a given year through six months, again, the law of large numbers says, are you going to be up 400% year to date? we saw the data earlier today that showed there were outflows of tech funds, and there is concerns about interest rates and global central banks are obviously being more specific. when you look at that altogether, can we have some pullback during the summer? sure. >> it is all of them, though. this was a week dominated by news of entral-bank hiking. and it came as a double from the bank of england, and in a surprise, a double from norway, which i know people aren't paying attention to. >> and the federal reserve as a double. >> jerome powell didn't say anything to dissuade from moore. >> it is a long list. >> so, maybe it was too good to be true that tech was rallying in the face of tighter policy and higher rates? >> well, i think the idea behind why you would pile into technology -- let's say on the back of low interest rates -- is because you are just looking at cash flows at a more attractive interest rate. if you are apple, nvidia, meda,

you are generating too many revenues, that become cash flows today, so i think that argument holds a little less water in the active side of things, then it does for, let's make another balance here, or workday, let's say, where more of your value is going to be realized in the out years, and terminal value. but, since we brought up the central banks, one cannot hide from the fact that central banks remain way more hawkish about inflation, then appears to be the market. the market continues to not believe what the fed is doing, they will not believe what the fed has done for six or nine months. >> one more hike? >> most of the stream is from the economic side of things, it appears to be at zero or even one. i think there are two shops that are -- andrew is a two, and i think our mutual friend, michael over at bank of america is now two.

everybody else is at zero or one. but, this is the story of the last nine months. >> the counterargument there is that they're closer to the end and even if it is one or two more, you know, bell is not going to ring when they are done. they are getting to the end. i think the bigger question is how long they stay at this high level and when they start cutting. >> i totally agree with you. >> does that change your view? >> listen, absolutely. the idea that one more hike is the straw across the camel's back, sure, maybe there is some evidence there, but at the end of the day, we have no way of knowing whether one or two hikes is it. but, with what you said, the longer you leave rates up at an elevated level, the more ocean you are churning, so to speak, the more refinancings are going to get difficult, the higher interest respect for on the bubble companies that are going to have more projects or investments that get put off because your hurdle rate is elevated. and again, the longer you leave

things up there, the more that starts to accumulate. traditionally, that is ultimately -- that, more than one more hike -- is what tips the economy over into a recession. if that is what happens over the next 6 to 12 months, then you don't really want to buy anything on an absolute basis, whether it be tech or industrials. >> i think this week they called it passive tightening, just to leave it on hold for a long time. by the way, i just want to point out the market right now -- because we are getting session those -- the s&p 500 down almost a full percent, nasdaq is down able percent right now, just adding to the losses for the week. again, down 1 1/2 for the s&p for the week. so, not a tremendous pullback, we are maintaining the gains for june. so far, a good month, 4% on s&p 500, but every sector is lower right now. what i want o introduce is weaker economic data, overseas and here in the new s. we know that the manufacturer is a sort of recessionary. but, do we worry about a recession, which we have been worrying about the last year and a half with nothing happening there? or, do you worry about higher interest rates?

bottom market can't do both. >> i would push back on, we have been worrying about a recession for a year and a half. on the idea that at least for me, i didn't think there was any probability of a recession last year. my estimate is that you would have a recession in the middle of this year. have we been talking about an impending recession for a year and a half? sure. >> we saw four .75% base rate hikes. >> ultimately what is going to happen is we underestimated where the neutral rate is, how high the federal reserve has to go to relieve the economic damage that i thought had to achieve. but, time will tell. but, with respect to the point about the passive tightening, i will just add, i don't think people appreciate this. if you leave rates up and inflation comes down, things start working against you from a tightening standpoint. policy just gets tighter, the more normal things get. with respect to the economic data that we see in the u.s., as that is happening, you are

starting to see cracks in the labor market and i do not think there is anything to fret about it just yet. but, when you have the work week coming down, and jobless claims going up, you are starting to see indications that maybe the strength in the labor market which everyone has added to a starting to crack. >> 260 jobless claims, stu stated hi. >> moving in the wrong direction. >> are you changing your posture? >> i have been less bearish this year, for sure. i would not say i have been bullish, but that is largely tactical on the idea that -- it doesn't matter, it is too long of a conversation. but, now, as any person who works in managing money will tell you, you have to think each day about the here and now, and not that then. it doesn't matter what i thought yesterday or the day before. what would i do with it now? if you're starting to see the labor market cracked the way they are, if you are seeing

global banks tightening the way they have suggested they will, then you have to start continuing -- i should say, you have to start being more concerned about the recession rather than less. it is important to point out that even if we are right, even if you are right, that people are worrying about a recession last year and it didn't happen, doesn't change the fact that the here and now means that worrying about it six months from now is what is relevant, not whether you are worrying about it six months, 18 months ago. >> so, now you are worried about it six months from now? >> i have been worried about it for a year and a half. but, i am wrong by now, hopefully i'm wrong in six months. >> was bring in cnbc contributor bryn talkington. are you starting to get worried, more worried about recession, and starting to reposition accordingly? >> we are not starting to reposition, shara. this year, we felt in terms of the economic data and the market that we had one of the widest ranges of outcomes, because to your point earlier, within a year, we have gone from zero to

5+ percent interest rates. and so far, the economy has been incredibly resilient. but, our concern at the beginning of the year is, we had 13 years of your zero rates, going so fast, so high, so quickly, it would create cracks in the economy. you clearly saw that in the regional banking sector. i think ultimately, you have this dislocation right now, where you are starting to see some economic activity, because while unemployment is getting a smidge higher, they are not staying unemployed very long and you still have 3 million baby boomers retired during covid and they are not coming back. so, i think as we are starting to have green shoots of on shoring, whereas the globalization happens, which is inflationary, we are missing these 3 million workers. if we go into a recession, it is not going to look like the past recessions. that has never been our call, that we are going to go into a recession.

we do think we are going and will continue to go into the slow contraction where gdp continues to come down, and naturally, that is a sector allocation of what you want to own and what you don't want to own as gdp continues to come down and inflation later on in the year remains sticky. >> what about the topic du jour about tech? the nasdaq rally has been surprising, and impressive so far this year. are we starting to see real cracks in that? would you change your tune there? >> no. i think that as of last week, it has come down a little bit, but as of last week, the nasdaq was 20% over its 150 day moving average. and sara, if you go back decades, that shows -- i mean, that becomes a very vulnerable, and in the first part of 2018, we saw a very big selloff from january to february because the nasdaq had got overextended. in the short-term, it is more vulnerable. but, this ai wave, i believe we are in the first and second inning and there are so few publicly traded companies that investors can own.

so, i still think companies like microsoft, nvidia in particular -- which maybe it's pe is expensive -- but, there has never, ever been a company , this big of a company raised guidance. so, i felt very confident that any maintenance on nvidia, people are going to continue to add into that name because it seems like a really clearcut way to get into that ai exposure, and it has earnings to back it up. >> you answered my question on that, with nvidia. dan, it gets into the -- i mean, the rally at the nasdaq this year has all been about expansion, right? are the earnings fundamentals changing for these companies? >> for the market, as a whole, you are starting to see earnings , revisions move to the upside for next year. and again, from a broad market standpoint coming into the year, one of the reasons why you would be optimistic is because you are looking at 6 to

9 months, and assuming, correctly or incorrectly, now we know probably correctly, that you are reaching something resembling a trough, and earnings expectations and you are starting to see that now, in which case if this is the end of the bear market, then you should obviously start buying, and the market would rally. i do want to make a quick point about ai and get back to that for a second. someone was making an analogy that i thought was really interesting about how we think back to the invention of let's say, refrigeration. nobody really knows who invented refrigeration, per se, but you know the cokes and the pepsi's of the world use that refrigeration to grow the revenues and earnings over the next number of decades. right now, whether it is nvidia, or adobe, or whatever, we are focused on who are the companies that are making the ai, which is not the right way to put it. >> it makes a struggle. >> that's right. and what will be really interesting over the next five years, which companies are going to use this. those companies are clearly not found right now. when they start to emerge, i imagine that is where you are going to make an enormous profit. >> but, you don't have any names for us, yet? >> i can't say any names on tv.

you must invest with the fund. >> so, what do you do, bryn, with the ai thing that has been in rising interest rates, worries about the economy, cracks in the labor market, valuation concerns on the market, i mean, it is hard to fight the ai wave though, if it is that transformational. >> you have to be patient. like i said earlier, there are soup so few public companies out there. i remember going back to the internet, when search came out, it was all about aol, yahoo, i mean, google hadn't even started then and that ended up to be the winner. so, i think investors need to be patient, don't chase it. that is why i was saying earlier, i still think nvidia, because they are creating that epicenter, that will be where assets will continue to flow, because it will be fair play. >> you say in your notes, markets don't care about the fed anymore. i'm curious about that, because i think i disagree. >> i care. i care about the fed. right? so, it is like, the market has

been very clear, if you see in this year's performance, what is working, the fed is done. the fed may, on the margin, go one or two, but i think to what you said earlier, to me, we are just going to stay at this level and go on autopilot around that 5% until we can't do it anymore. so, i am very concerned about it because i think jay powell has those 70s behind his desk that shows you that inflation had been trapped. and guess what? it started running up again. so, i think that will continue, in my mind, to be a concern, but i think the market has clearly shrugged off that they are going to do anything else other than rhetoric. >> but, don't you think the market is factoring in interest rate cuts next year?

sooner than the fed is factoring it in. so, do you see that as a downside risk if the fed doesn't do it, or do you see it as an inevitability? isn't that going to matter, and isn't everywhere going to be scrutinized until the fed starts cutting rates? >> if you and i are talking about it, it is already embedded in the market. i don't care what the future says. the market knows, what it predicts in the future. so, powell could say, we are not going to cut rates for two years. the market doesn't believe that, for sure. and i think it is unknowable, because at the same time, sara, they are human beings, they make their best efforts. but, jerome powell in may of 2022 said, we don't see any 0.75% rate hikes on the horizon, so these are best efforts, but they don't have the best track record of predicting, so it is still a concern of mine, but i think the market shrugs it off. >> i do think it is worth bringing up, down, and i will bring you the final word, that it is 37. so, it has come down on the week even with this titre talk and a tighter policy.

and they haven't broken to the upside, and maybe if that happens i could be a big headwind. >> traditionally, the two year doesn't trade that far under the fund rate, unless the fund rate is expected. let's say there is one more hike, you are a fairly large amount below where the fed funds rate will be. so, to your point, i don't want to predict anything, but i think the two years is probably not right, two years is probably going to have to go a little bit higher, especially if the fed hikes two more times. >> is not going to be a headwind overall? >> i don't know if it is a headwind, per se. but, this is the only question that matters for investors today, is if the fed feels like it is going to crack the labor market to ring that last one or two percentage points of inflation out of the economy, what effect does that have on the start stock market and corporate earnings? as long as the fed doesn't

think they have to do that, the market doesn't care. the second the fed is at the point where they are really doing damage to the labor market, in order to get inflation down to 2%, i agree they don't know, but if that happens, believe me we are going to care about the federal reserve. >> dan, thank you. have a good weekend to you both. that brings us to our twitter question of the day. we want to know from you, which one of these big tech stocks would you be buying on weakness? intel, amd, microsoft, or alphabet? you can head on over to cnbc "closing bell" on twitter to vote. let's get a check on the top stocks to watch as we head on into the close. christina is ere with that. hi, christina. let's talk about pdd holdings. some of the biggest on the nasdaq 100 today. unfortunately, heading for their first week since march. declines, over a ongoing concerns over the economic picture you ust discussed and china's own recovery.

this actually said to snap a three win streak at the moment. you can see pdd for example is down almost 5% right now. let's switch gears and talk about corn-based. coin base is higher up in the supreme court ruled that customer losses against the company could be paused while it aims at moving disputes into arbitration. but, the move is also being driven higher by a rebound in bitcoin that has been trading at its highest level in over a year, and topping $31,000. right now, it just came under 31 but it was above 31 when we wrote this. coin base, also 6% higher today. sara? >> thank you. we will see you in just a bit. we are just getting started here. coming up, our next guest is betting on one financial name as an under the radar crypto play. and later, we are setting you up for "nightly earnings." we will talk to a top analyst on what he is expecting from that report and what it says for the average consumer. you are watching "closing bell" you are watching "closing bell" on cnbc, down to 20 on the dow,

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last 18 months. but, there is definitely opportunities for some companies that are just not so far over their skis like the magnificent seven to keep these. >> but also, schwab is a top your list which is an interesting one, because it is a little bit controversial right now. it was considered after the failure to be in trouble, and manager came on here a three times, tried to reassure everyone. why are you buying schwab? >> not only did he reassure everyone, he also plunked down $500 million of his own cash to buy additional shares of the company. any time you see an insider buying like that, it definitely should get your attention, but i think that schwab is a unique story in the sense that it got thrown out with the bathwater of the regional banking crisis, but it is not necessarily a bank, it is a brokerage that also has a little bit of banking business. aside from that, what i think

is about to happen as far as schwab's shares are concerns, is the announcement of edx, the exchange for crypto trading that just got announced earlier this week. schwab is one of their initial investors. what that is going to do, is allow people to invest in crypto, hold their crypto inside of their brokerage accounts, alongside their individual stocks in a way that we haven't seen happen before. and i think that is a seismic shift for the crypto industry, because it brings some validity to it, it brings it to just being a fringy thing nly done ongoing base and others, and makes it more mainstream. and i think of the three, you schwab, fidelity, and vanguard as the major brokerages where people trade individual stocks. it is the only one that is publicly traded. fidelity is publicly owned. so, it is the only way to play that trade, i think. >> are you excited about that opportunity? it has been a wild since someone has been excited about an equity based on crypto opportunities, with all the fallout there. >> i would say that it is definitely early in the game. schwab always tends to lack its

banking peers anytime there is a massive selloff in the banking industry, so there is definitely still time to get into the trade. but, what i think is really exciting about it from a positioning perspective, it got sold off wholesale with the rest of the regional banks as we were just talking about with sbb. it fell 35%, so you are buying at a discount anyway, holding and waiting for the opportunity to cash in on the crypto trade. >> i mean crypto, are you positive on crypto as a real catalyst for this company? >> i think going into next year, when the appening is scheduled to happen, there will be a renewed interest in crypto, specifically in bitcoin, that is where the excitement really starts to rally. i think we definitely aren't done hearing and talking about crypto as a meaningful opportunity. >> i wanted to highlight another one you are uying, which is united healthcare, we saw this big pond, what was it, last week, on some comments at a conference that they were seeing more surgeries and more elderly people getting elective procedures and that was going to hurt the business, big selloff.

>> i think that was a mistake. i actually think the concern around elective procedures, hips, knees, replacements, those kinds of things that seniors were holding off on during the pandemic and decided to now kind of ramp back up, i actually see that spending as a positive. and if you think about insurers in general, when was the last time an insurance group actually ate the cost and it didn't pass on those additional costs to the nsurer? if you think about the insurance business in general and the way that it works, i think that 7% selloff actually presented an opportunity and we will find out after earnings, mid july for unh, just how true that is. but, i think the holds, selloffs, and all of the insurance names was a mistake. the reason why i like unh out of all of them specifically is because it is the largest holding in the dow and the 10th largest stock in the s&p 500. so, it is going to benefit from that trend. >> a long-term chart on unh is

pretty amazing. it has been a moonshot over the last five, 10 years. but, it really has been marching in place just the last year or so. where is valuation? >> so, we have been very bullish. we as a firm have been bullish on healthcare the past couple of years. and you are right, that was a trend that was doing us very well once upon a time. in the last year, that thesis has cooled off. but, i don't necessarily think that is indicative of a complete stock, or a slowdown in the health industry. i still think there is a lot of spending that is having and will continue happening in this space. as earnings start to come out, q2, q3 is going to make the case for a renewed interest in healthcare. especially as we look to rotate away from tech and try to figure out what comes next. i think healthcare will be a big beneficiary of that. >> may be some signs of that this week, the only sector to close positive this week, in a down market. malcolm, thank you.

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day now. kayla tausche is live in d.c. with how that decision might impact the u.s. economy. kayla, what do we need to know? >> sara, we didn't get the ruling from scotus today, but it could come next week. regardless of how the court rules, borrowers are preparing to resume their payments in september after three years of a pandemic era pause on $185 billion in payments to the government. the pause saved borrowers between $300 and $500 a month according to the education data initiative. that is money consumers will no longer have to spend elsewhere. so, what is the impact of that spending on the economy? goldman sachs' analyst, alan phillips, says it depends on part on when the supreme court allows the president's loan forgiveness plan to go forward, writing, in the case, the impact on spending is likely to be modest in the medium-term. we estimate student loan repayments will subtract .2% from pce growth this year. if the student loan forgiveness

plan is struck down, or .1% of the plan stands. the other question is, for how long? interest kept accumulating on the nearly $1.8 trillion in outstanding debt, even if those payments weren't being made. now, many borrowers are underwater. the center for responsible lending took a snapshot of borrowers and found 63% of borrowers owe more than they originally took out and a third of those owe more than 125% of the original balance., chipping away at that debt will take time and the white house is not prohibited by congress from extending the pause any further, and it could take borrowers a long time to catch up with that. sara? >> so, what is the expectation? is it that scotus will rule against the president's plan? >> reporter: the expectation is that scotus will strike down the plan to forgives of to $20,000 per borrower.

you could be surprised, but that plan is an estimated $400 billion boom to the economy. if it goes forward, it would keep a lot of that money in borrowers' pockets. the expectation is that it will get struck down at some point. >> kayla, thank you. let's get back to christina who is looking at how the scotus ruling could impact payment stocks, so fight in particular has moved a lot on this. >> i want to piggyback on what kayla said, because you have a consumer high of 17 trillion, people 30 days late on their auto and credit card debt, now you have the student loans that are set to be repaid back in the fall. the consumer right now has helped lending as well as by now, pay later companies like a firm start, sofi. those three names, not paypal, those three names are at least 50%, year-to-date hire, fastly outpacing the s&p 500. the issue with the analysts, they are saying student that

has been priced in because we knew it was going to end as of june 30th, that moratorium. compass has a sell rating on sofi in particular with a five dollar price target, and they point out that the pause was scheduled to end on june 30th. that is why you are saying the stock is down today. paypal announced another deal with a private firm earlier this week to by its european by now, pay later debt, which is definitely good news for paypal because you are externalizing the credit portfolio but bad news that the company still has named a ceo, cfo successor, either, and is facing increased competition from the likes of apple, for example. also part of the reason why that stock is down year-to-date compared to the other players. then, you have a firm seeing total delinquencies increased in may after two months of decreasing. but, still says this is a buy because this is one of the leaders in the space. sara, i just named a few names, there are so many in this space, which is why saturation is considered a negative, and the fact that already priced in that made it more difficult for many of these names to climb higher. >> christina, thank you.

is still to come, driving growth -- carmack shares are popping today. i want to tell you what is behind that move. plus, your earnings rundown, we are setting you up for nike results next week. the key metrics every investor needs to be watching for, all ahead on "closing bell". we are still at about 200 points hanging around this level. we will be right back.

goldman sachs facing a big write-down on its troubled green sky deal, that is according to the latest scoop from cnbc.com. what have you learned? we knew they were putting this for sale. no update, but you have been doing some work? >> they are gaining out of consumer finance, large. so, this is part of that. however, they are finding that the market in the middle of 2023 is far different than the one in which they purchased it in late 2021. >> how much, again? >> they announced 2.2 billion, all stock. it took six months for the deal to close, and the economics was roughly $1.7 billion when a close, i'm told. so, the offers they are getting from the likes of -- we are talking about some strategic purchasers, kkr, poly global, they are talking about a

valuation for the origination business of roughly $300 million-$500 million. two, there is a delta of that in the purchase price, of well, as one $.2 billion. what we don't know is, there is also a loan component. so, might be getting credited with creative loans in the past year, and they are going to sell that loan book, as well. that can offset the hit from the fact that they lost money on the sale of the origination business. >> where does this fit in overall, with the goldman strategy? green sky was part of the consumer push. >> and worked very hard for that. he purchased it. so, you know, it just shows it is sort of a whiplash kind of moment. here, you are inviting a business in, you are saying we are going to be your long-term stewards. about a year after he closes it is like comic just kidding, right? there's whiplash on the part of the employees. they want to put this behind them. they said that this is behind them. however, in the coming quarters,

they're going to have write- downs from this and other things. so, it will be a reminder of a deal they preferred not to have done, sara. >> well, looking at the models for earnings in this quarter and the year, and in our interview he talked about some real estate losses and equity exposure real estate losses. but also, $500 million in impairments related to greensky. >> you, thank you. another great scoop. keep us posted on what you learn. last chance here to weigh in on our twitter question. remember, we asked, which big tech stocks would you be buying on weakness? intel, amd, microsoft, or after that? go to @cnbcclosingbell on twitter, we will bring you the results right after this short break. ♪ these are the people, who help you stay well. ♪

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let's get to the results of our twitter question. we ask you, which one of these big tech stocks would you be buying on weakness? it turns out, more than 40% of you said, microsoft. 43%. the next was amd, 21%. and then, 22% for alphabet. there you go. up next, carmax shares popping today. we are breaking down the used car market, and what that strengthened sector could mean for the toau space. then, we take you inside the market zone, down 170 on the dow. we will be right back.

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we are now in the closing market, as cnbc market commentator mike is here to talk down the moments of the trading day. plus, carmax shares, and brian on by next week's earnings look promising. mike, with the market, which is feeling soft as we head into this weekend, also a couple things going on with rebalancing and expirations. what we need to know? >> a lot of mechanic stuff going on. mostly, it is a volume issue, a big sweep of orders at the close, as the indexes get reconstituted. i think the biggest issue this week, is the first sustained selling you have seen each day, profit taking in a big nasdaq stocks, as well as regional banks down 8% on the week.

you have semiconductors like, 6% off their highs. all that considered, a very orderly pullback, in some days, textbook. this is disproportionally a down week, but modestly so. we have seen that so far, i don't think it leaves us with really looking at any clear page coming our way, if you are below. just because i think sentiment has improved enough that it is no longer possible to say that everyone hates this market. obviously, valuations have gotten higher again, but we are in this window where economic surprises are coming to the upside, and the fed's messages are consistent, but not incrementally more hawkish, i don't think. all of that mixed together means it is kind of a coin toss in terms f the next few percent, but the market uptrend has been maintained. >> let's get to what carmax's quarterly could mean for the big car market. a big move up here, phil. >> big move up.

biggest move in about three years for carmax shares. this is a case where they beat on the top and bottom line. the numbers within the numbers show that you are still looking at a business where revenue, in terms of what they did last quarter, it was down 17.4% from a year earlier, so they have a stronger inventory mix. if you look at shares of carmax over the last six months, they really have had a nice move higher. remember, as the interest rates have risen for auto loans, and as the market has become so heavily, highly priced, the importance of having lower priced vehicles, it can't be overstated. that is important because they have 25% of their vehicles priced at under $20,000, makes sense, sara. if you have a market where people are looking for the best deal possible, and they are looking for those vehicles under $20,000, if you can play in that market and make a profit, you are going to do well, that is why shares of carmax are higher. by the way, all the auto dealers who has been either expressly with used vehicles, or have a heavy mix with used vehicles, they have all been

moving higher over the last several months. so, today, carmax, not a surprise as they beat the top and bottom line. >> mike, some interesting applications for inflation and monetary policy. remember, it all started with those used-car prices. >> yeah, they are not really cooperating with the rapid d inflation story. other parts of the economy are. although, it seems like auto related expenditures are stealing share of wallet from other things. if you look at the bank of america consumer spending data this week, x auto was much weaker than everything else just because prices are higher, as phil said. i don't think it is necessarily the cleanest story for the economy, but it is going to need carmax shares of like, 16%. people really thought that event was going to be much worse for the auto business than it has been. >> auto loans in particular. ryan and neagle of oppenheimer, let's discuss nike. you have seen promising signs heading into that release. explain? >> good afternoon, sara. i do.

the center around nike has been very negative lately. it is the same story over and over again, investors are worried about some pullback, that is spending pullback catching up with nike. but, if you look closely, there has been a number of reports lately from dick's sporting goods, academy sports, they have all topped up, if you will, underlying strength in the nike brand. so, the one place we saw weakness was fort walker. i think it is mostly for locker problem. we have seen a lot of innovation in the brand. i think underlying, while there are points of weakness in consumer spending, i think overall, the consumer is in pretty good shape here, buying products like nike. >> i think the concern around nike this quarter in particular is first of all, inventories might be bloated and the china recovery might be bumpy, which has been key to the nike story. >> i agree. i mean, that is what we watch.

so, next thursday night, mikey is reporting it. those two points you brought up are exactly what we will be watching. from an inventory perspective, if everybody looks at this leisure channel, inventories have really been cleaned up. if we go to nike's last quarterly report, i think nike's inventories are basically back in balance. so, i don't think inventory is an issue. china is more of an unknown. but, what we have been hearing from nike and others is that as the chinese economy has moved past the covid crisis, you are seeing more activity there. i think to the extent that nike comes out and shows sequential improvement, that is a positive of the stock here. >> what has the stock been doing, mike? >> it is right in the middle of its one year range. i would argue it is holding up relatively well, considering -- and if you look at calendar year consensus earnings for the current year -- we are talking about 2021 levels of eps. i mean, that is just consensus,

not using the fiscal year. it shows you that there has been this reset on profit expectations. it has maintained most of its valuation. i think it has that quality by us, that people want in the market right now in the consumer area. so, it is hanging in there, and it is all about getting some kind of clarity as to whether there will be more of an upswing, in terms of demand. >> it also reminds me that we have brian and wells fargo downgraded from under armour today. they cut the target from eight dollars to $12. obviously, a totally different story. wells says it is a self-help story. we wait to hear from the new ceo to see what the plan is for a turnaround. but, who is gaining shares here? lulu has been on a really strong run in terms of performance. nike seems to be firing on all cylinders. what is happening with the rest of the group? >> i think you summed it up well. lulu has been performing remarkably well. after every quarter, the quarterly reports, loop message is, what recession? nike is not far behind. it just grows fast.

under armour, i like under armour. i think there is a repositioning story that is happening. it is going to take time. like you said, sara. there is a new ceo. i think she laid out a great plan, it will just take some time here. arguably, under armour is probably donated a share right now, probably to lulu lemon. >> brian, thank you. good to talk to you. we will have those nike results next thursday. and as we head into the close, mike, we will give you the final word. now, that could have been higher this week, considering all of the hawkish talk from powell, kind of hawkish. but everybody else still raising rates. >> it threatened to go higher, actually, for a little while. there has been this undertow of weaker global macro numbers, and that has dragged down globally. i don't think you can necessarily dismiss any of that.

i know the economic surprises are running well in the u.s., so it seems like we immediately sidestepped that recession risk. markets have flattened out and are tilted higher over the next 12 months. all that said, it is where it is, leading indicators are where they are, and you haven't repealed their power, necessarily, to say that there could be a downturn coming. i think really, the argument comes down to, what work has the overall stock market done to take account of the possibility of targeted further declines in the u.s. economy? so, you don't stay in the range past five for stocks. it is more about the message that it sends, in terms of whether we are going to have this weight of the leading indicators of the recession drag us in that direction. >> what are we watching into next week to find out whether this selloff will be something more pronounced? >> if you just want a straight up seasonal pattern, those are probably more weeks, but then you have to perk up into the very, very end of the quarter. july has been okay. i think what we are looking for

is, we have the university of michigan consumer numbers next week. so, some numbers about the consumer. and then, we are going to be focusing right in on second quarter earnings before too long. it is looking like a trough. it is looking like a 6% expected to decline year-over- year. but, s&p 500 for the second quarter, let's say they come in three percentage points better than usual. still, a decline. third and fourth quarter, we are talking about flat to up. so, getting some guidance over the next couple of weeks i think will be somewhat significant to see. also, this ai wildcard, you know, it is kind of this source of animal spirits in the market that you don't really know what to do with. but, if you look at c-3 ai, that stock has gone down from like, 46 to the low 30s from the highs, but it is still up massively. that is sort of sloshing through this market, and the options flow in things like tesla and nvidia still show signs of getting overheated. >> and we have corrected the

positioning that is coming in saying, that is why the market goes. everybody was too bearish. >> i think all that has been taken care of. in theory, if we get out right driven, there is room to go. >> all right. there goes the bell! market friday not going to close down more than 200 points. s&p 500 down by .08%. and nasdaq down, as well, for the first time after an eight week run. that is it for me. now, over to morgan and john. that's right, stocks ending lower, the worst week since the average since march. welcome to the "closing bell", i am morgan brennan with jon fortt. coming up, it is double trouble for us. >> oh, yeah. >> we have former facebook executive and current disney end board member, carolyn everson, joining us about her latest appointment. plus, her read on the consumer and advertising industry