good monday morning. >> today investors playing their cards close to the vest with three js set to define the market this week. an ace in the hole with jerome powell in jackson. jenson huang cashing in and a potential house of cards for xi jinping. >> mohamed el erian is on deck to weigh in on all of that along with the strategic direction the fed should go. >> the market currently mixed. s&p trying to hold its gains

there. and the nasdaq up about 0.50%. at this hour, a lot to look forward to. you can see that with the mixed reaction in the market. but our very, very creative producers put together the three js with the gambling met aforeand what investors are looking for this week. of course, everything -- we talked about it last hour with nvidia on wednesday. you've got jackson hole. what's going on with china. all of these things are impacting sentiment. especially in august where, you know, volumes are light. directionality a little uncertain. these are the three things it you'll be watching. >> we're back to wringing our hands above zero day options. it will be a nice blend of macro, jobs revisions, housing data and micro, as we get a lot of specialty retail earnings, gap, anf and a few others along with splunk and snow, and nvidia is on the star of the show this week. >> when was the last time we saw a company like this who has

earnings coming out, just the overall barometer for the entire market sentiment? apple, sure, every quarter we talk about apple. nvidia in terms of its overall role on sentiment, a.i. spending, the directionality of the market hinging on one stock. it's remarkable. this is the world we're in. >> meantime, we'll look ahead to jackson hole. the fed speech on friday will be a major focus. our next guest says there are a few strategies he might take. he could signal short-term policy, he could dive into long-term policy or limit it to the economy with no immediate policy implications. here to discuss is mohamed el erian. what a treat to have you back. good morning. >> good morning, carl. >> so, you laid out some possibilities. talk to me about what's likely. >> so, what's likely is that he's probably going to talk about short-term monetary policy issues. i don't think that's the best

thing to do because it is a very delicate situation right now. the good news for chair powell is this is a target-rich environment. whether he chooses to focus on the immediate, whether he chooses to focus on the longer term or punt, as others have done in the past, and look at a narrow economic issue with no policy implications. he has a lot to talk about, carl. that just shows you how fluid the current situation is. >> right. speaking of target rich, you probably don't envision any attempt to make adjustments to the inflation target, or do you? i'm just thinking in light of the piece in the journal over the weekend about r-star. >> there's more and more people saying, look, if we were to decide on inflation target today, it would not be 2%. it would be slightly above that. i think that's a very strong argument for that. having said that, it is very hard for central bank to change an inflation target when it has been missing it so consistently.

so, yes, thaurz a theoretical argument for higher inflation target but don't look for chair powell to touch that issue in any significant way. >> interesting. i wanted to turn your attention to china. you were tweeting overnight that the news and the overall sentiment in the region is a reminder that old-fashioned stimulus measures are not as obvious or as easy of a go-to for the government as they used to be. at this point in time, do you see any additional stimulus from the region as they try to at least improve gdp in the region as to what the market expectations are. >> look, leslie, they have two issues. they have a growth problem and they have a debt problem. and because they have that second issue, don't look to them to do major stimulus. you know, the market was hoping for more, but they didn't deliver more. it's not because they're not worried about economic growth.

they're very worried about economic growth. they're very worried about youth unemployment over 20%. the reality is that they cannot use the old-fashioned stimulus measures. what they need is a fundamental revamp of their growth model. and that's not coming any time soon. >> are there any takeaways, you think, for other nations who have employed kind of infrastructure spending in a way that they have? obviously here in the u.s. we have been embarking on a lot of spending, a lot of fiscal spending. you know, in certain pockets of the economy. do you think there are lessons to be learned here or just a different situation all together? >> there are lessons. this is an important time to redirect economic growth. we have a green transition we have to take seriously. we have fragmenting globalization, supply chains are changing and certain currents like ours have tight labor markets. when you look at that you need a

major emphasis on the supply side. and carl was asking earlier about u.s. exceptionalism. u.s. exceptionalism is not just in economic performance, which is significantly better than most other countries, but also in the approach taken to future economic growth potential. there's been a major emphasis on revamping the energy equation to make it greener, to make investment in growth areas, and i think other countries are looking at that. and they're jealous of us because they don't have the ability to do what we've been able to do. >> we had a discussion with jim this morning about this piece on the tape today that basically argues that xi is running cold, running the economy cold on purpose because he knows they need to break this addiction to the empty calories of, for example, real estate development that is run on debt. i wonder if you think they're being that sophisticated about

it. >> i think they are. i think jim is absolutely right. they've had a scare, a major scare, and they recognize they can't just pump in liquidity because they've got pockets of leverage and excessive indebtedness that are turning systematic. that's the issue they learned. this is no longer about isolated pockets of leverage. these pockets have turned systematic. that's why they are being so cautious. and to the rest of us, they look like they're not being decisive. in fact, they are being decisive because they don't want their debt problems to be bigger. >> finally, and we asked jpmorgan's economist about this last hour, can we take some so will solace in what some are arguing is -- and now we have german ppi negative year-on-year? >> yes. carl, look, our problem isn't

goods inflation. goods inflation is coming down. we've had disinflation in many goods. what happened with the ppi would suggest that. our problem is service inflation. and to a certain respect, that remains the key aspect. and that, i suspect s what the fed is going to look at. we need to get service inflation down. because at some point goods disinflation is going to stop. it's really important to start seeing service inflation coming down significantly. and we have not seen that yet in a meaningful way. >> some would argue we might already be at that point. we'll have to find out. great to have you kick off the hour for us. thanks so much. >> thank you, carl. >> mohammed el erian. we'll have a lot more on the fed and, of course, powell's speech live from jackson hole thursday. the speech, of course, friday of this week. >> it's certainly a busy one. while the overall market has been on a downturn lately, there is one area that's seeing some green shoots. a little optimism. that is in the deal-making world. in m&a you have effectively a

bidding war for u.s. steel and starboard engaged and ipos. this is good news for a market that's been effectively dormant for a year and a half. acquisitions came in at a meezly $66 billion the first quarter of the year. that's about 16% below pre-pandemic first half averages. and ipos didn't fare any better despite well-publicized debuts like the likes of caba and k kenvu. they are raking in a tenth each quarter than they did in 2021 according to kpmg. while the engines appear to be turning back on, it's not quite full speed ahead. bankers and other sources i talk with say a lot of companies are in wait and see mode. they want to assess some larger ipos in the pike and then get a little more comfortable doing deals, especially in this regulatory environment, which has been such a hindrance here

before they jump in and do anything major. as the prospect of a recession seems further and further away, you can expect to see a little more activity than we've gotten used to. and i'm told you kind of after labor day expect to be a little busier. the regulatory headwinds not going away, but kind of this breath of fresh air in terms of the recession prospects has some in the c suite saying if a recession is not around the corner, maybe now is my time to do a deal. >> you've been wondering when the window is opening. we've heard from the banks lately it might be about now. interesting, you know, bob was talking about arm going to the nasdaq but the s&p is still leading year-to-date in terms of dollars raised. >> the nasdaq has been a tech-focused exchange. the nyse has been trying to change that over the years. this year we haven't seen nearly as many tech ipos. what will be interesting is what we see the remainder of third quarter, going into fourth quarter. hotly contested, you know, war

between the two exchanges to get those listings. extra, extra important in a year like this where there aren't that many to get. the pie is very small. >> some things never change. china beige book ceo leland miller is with us with a contrarian call on that country. ntue t see onhetrt" coins. 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. e*trade from morgan stanley. power e*trade's easy-to-use tools

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vmware is higher. follows a similar ruling out of the eu. broad com awaits a decision on the deal from china. obviously we've been talking about this, feels like, since we were little kids. >> i think we have, yes. my middle school project centered on -- no, just kidding. speaking of china, more than a few reasons to be bearish over the last few days. you have some of the street's biggest names cutting their growth forecast. issues swirling about evergrand and country garden. a swath of recent economic data coming in under consensus. and despite all of this, our next guest is urging caution on being too bearish. joining us, china's beige book ceo leland miller. this is a pretty contrarian

take. what gives you confidence that the sentiment is too bearish at this point in time? >> well, the keyword is relative. i think relatively speaking people are too bearish because all we're hearing about is collapse. china government, the collapse is here. none of this is actually true. you have some very, very bad data that are coming out right now. for different reasons. i think you have the pathetic recovery that happened. it was a recovery but it was a pathetic one in the second quarter with retail and services. and you have the property dynamic scaring everyone. all this bad news, everyone is saying, it's going to pop, it's going to pop. that's not the way chinese financial system works. >> i think you bring up a really good point because investors in china have gotten used to it, just overall support from the chinese government. that's a key point people are bringing up. this time around there hasn't been that huge stimulus push to

fix some of the holes they're seeing. they're worried that that may not ultimately come. what do you think ultimately transpires with regard to the beijing response here? >> i think what we're seeing in property is because beijing wants it to happen. we were talking about how the chinese government is moving actively to deflate the property bubble. guess what. it's not pretty, it's going to be painful. that's what's happening right now. china can control this because it has a noncommercial financial system, which means it controls the counterparties in the country. it controls the lenders and suppliers and borrowers. and both sides of cash flow and both sides of other transactions. so, china is allowing this to happen because it thinks it can -- it is necessary for debt sustainability in the long run. that doesn't mean things are good. it it just means we're not on the verge of collapse. >> how do you see that control

deflation taking place? i've seen commentary where investors say, we know what this would look like if it was taking place in the u.s. we know what would come from it and how to trade it, but in china things are a little different. we haven't seen such a deflation in many, many decades in that region, so what would you say to investors who are trying to figure out the next move on the chess board? >> well, two years ago we came up with the analogy they want to cull the herd. when it gets too bad, they ventilate the system. that's exactly what we've been seeing this year and last year and the year before that. beijing is stepping in. they need to make sure the system takes out the weak players, is less reliant on endless credit being pumped in the system, and also doesn't take out the stronger players and freeze cash flow. they make a big move, like they're making right now. when things get too bad, they step in with some support. not to juice the system. not because this is going to be some game-changer and go the other direction but because they want to stabilize the system and

make sure they're not wrecking property across the board. it's a painful process and i think people are getting too panicked about it. >> the journal, such a great piece about the economy there where they argue xi and his lieutenants remain suspicious of u.s. style consumption because they think it's wasted time when they should be girding for potential conflicts with the west. does that sound thematically true? >> yeah, i think that's right. the big question every china watcher i speak to has is why have they not done more on the household side, on the consumer side? when you see stimulus in china, it's always on the supply side. it's always pumping more capital into production. it's never supporting households. it's never supporting the consumer. right now you have very weak consumption, very low confidence. they probably would be very justified to put in some consumer stimulus. there seems to be a dogmatic mental wall. i think what they're doing in terms of consumption is quite

mysterious. >> what about the impact on the overall economy given the uncertainty here, given the slowdown. you've seen some multinationals redeploy efforts to pockets of asia, india, vietnam and the like. what do you think that does for the long run for china? >> i think investors are sensing this is a very different china than they were dealing with years ago. you do have slower economic growth. you do have more mysterious rule law but you have crackdowns on foreign businesses, you've got less economic data being released. i think people look at this, geopolitical tensions, supply chain problems, all the issues with covid zero before and after. so, you have all these issued. i think a lot of corporates are saying for a long time, you had to be in china, you had to be in china. some are still saying that and they'll produce in china for chinese consumers where everybody is saying, we have to have a plan b. we have to make sure what happens in china doesn't wreck what we're doing around the world. that's why things are different

than they were five years ago. >> there are a lot of layers to this story. a lot of nuance. you did a great job breaking it down for us. thank you for being here. >> my mr. you are. meantime, jpmorgan says it's time to bet on burgers, chib chicken and coffee. we'll break down the restaurant name they think can rally 20% as a sea change takes hold of that country. >> now i'm hungry. we're also watching palo alto reporting after the bell on friday. many on the street thought they would be trying to hide bad news but the stock jumping today after an earnings beat and outlook. crowdstrike and z scale up on that news as well. my cpa told me i wouldn't qualify for the erc tax refund, so i called innovation refunds. their team of independent tax attorneys will work with your cpa to determine if your company is eligible. [whip sound] take the first step to see if your small business qualifies.

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welcome back. european markets set to close in just a moment. mostly rebounding after four straight days of losses. data suggesting inflation is easing overseas. part of today's market story is german producer prices fall at

the fastest rate since 2009. a sharp fall in wholesale energy prices. which leads us to our story abroad this morning. that is energy. that sector leading today's gains as opec suggests crude oil supply will tighten, nat gas futures also rising over a potential union strike in australia. crude last week posted seven straight up weeks prior to last week, and, carl, as you look at the month-to-date, what sector, the only sector in the green, month-to-date, august? >> is it energy? >> energy. up about 8% and looking to be in the green, positive year-to-date. it's definitely a laggard year to date but the month of august it's had a decent rise. >> we keep shaking our heads why it's not responding more to a china slowdown. and meantime the rig count in this country down at a 17-month

low as some drillers see something regarding demand that's keeping them from adding more supply. >> it seems like the supply part of the equation really the driving force here. at least in august, in pushing prices higher. you're seeing that at the pump, too. i think prices are at the highest -- gas price is the highest since october 2022. over a year. you feel that if you're driving to the beaches. >> starting to see some four handles, that's for sure. let's get a news update with silvana. here's your cnbc news update. ukrainian president volodymyr zelenskyy with an historic agreement to get f-16s. he tweeted ukraine would get 42 f-16s from the netherlands and 19 from denmark. yet the dush government has yet to confirm that number. former president trump confirmed he will skip wednesday's republican presidential primary debate, but that's not the only one.

in a truth social post this morning he said he wouldn't be doing the debates. his campaign has not clarified whether that means the two currently scheduled debates or every future one. and a new report from the world travel and tourism council projects travel will be a $15 trillion industry in the next decade. that accounts for more than 11% of the global economy. by 2033 the industry is forecast to employ one of every nine workers on earth. leslie, back to you. >> that seems like a good thing. everybody going and visiting each other and, you know -- >> or we have to get used to really long lines at the airport. >> yeah, i feel like we already are at this point. thanks. up next, ubs says investors don't fully appreciate the macro challenges facing u.s. consumers and a retail reckoning is on the horizon. they're warning about the industry coming up. quick check on the markets here. as we said, dow lost about 200 this morning. s&p has given up some gains.

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duckduckgo comes with a built in engine like google, but it's pri and doesn't spy on your searches and duckduckgo lets you browse like chrome, but it blocks cooki and creepy ads that follow you a from google and other companies. and there's no catch. it's free. we make money from ads, but they don't follow you around showing the millions of people taking back their privacy by downloading duckduckgo on all your devices today. we were about two hours into trading. let's go post to post with bob pisani for a look at what's moving this hour. >> we started positive and we're negative now. we need a little help from sectors like, for example, consumer staples. energy was a great performer at the start. oil was near $82 at the open.

right after that, just droop now, $80. so, halliburton, all the oil service names were positive. it's now negative but it's had a great month overall. we were 30 and change and over that and just had a terrible morning. keep an eye on other things. i've been complaining about consumer staples. everything is down 5% this month. valuation concerns, rate concerns, i'm not getting that help either. i keep talking about some of these big names, general mills, another new low. campbell's, conagra, kellogg's, you can go down the list, not helping at all. nobody wants to own them, even if you're concerned, defensive makes a little sense. then we have the moves up in rates which is killing the rate-sensitive stuff, utilities, and we got utilities people love

for their yields. guess what. the yields are going up. we're getting new lows here. eversource. these are all the big regulated utilities that are out there. so aep, american electric power, dominion, all of these, these are what you call regulated utilities, they're having a terrible time sitting near 52-week lows. we had leadership groups. it's all right if tech underperforms, but if you don't have other things pulling it up, you get a 5% down month, which is what we're getting right now. carl, back to you. >> thanks. meantime, ubs's bearish outlook on retail grabbing our attention this morning. they say new market research shows consumer spending intentions have fallen in august after an uptick in june and july. while apparel spend is where people look to save the most, ubs sees some upside for the dtc focused names and forecasting downside for brick and mortar names like dsw, foot locker, macy's and gap. some report this week. courtney reagan joins us with

her outlook as we get a nice diet this week, court. >> there is so much we're going to go through this week, carl. of course, we'll get lows. that's a little bit of a different look than what we get for pretty much the rest of the reports. we got home depot last week. a little foreshadowing most likely to what we're going to see there. it seems like trends have followed a little more closely in recent quarters for those two names than they had in the past. so, i think we kind of know what we're going to expect out of lowe's. everybody else skews heavy in this specialty apparel and footwear category. that's where i think there's a bit of a tossup. that will separate the winners from losers when it comes to being able to really execute on the fundamentals because this is a category that is really under pressure, like we've pointed out in this note from ubs. you have to be able to deliver what consumers are willing to pay for right now, which is what walmart suggested. and i think it was really interesting how their discretionary category, yes, was still weak year over year but improved from last quarter while

target still saw that pressure and overindexed there. i think we'll get a lot of interesting reads this week from macy's, from nordstrom, from kohl's, from gap, abercrombie. i think uts going to be a mixed bag. >> interesting, court. so, in this ubs report they talk about how the u.s. consumer spending philosophy is increasingly live for today because tomorrow is uncertain. are you finding the same thing with the commentary on the calls? is there a sense that, you know, things might be peaking this quarter? . >> it's so funny. i thought there was an interesting call out. i thought, well, okay, i guess i kind of get it but i'm not sure i really heard that sentiment exactly echoed so far from executives. i think even the retailers have turned in pretty strong quarters still are really cautious for the back half of the year which hasn't changed from what we saw last quarter. it was very similar, how the year might have started out strong. i think most retail executives

like ubs are looking at bigger macro pictures and thinking, oh, my gosh, there's still a lot of pressures that consumers are dealing with and potentially more to come, when it comes to the resumption of student loan payments. i think that's still a really big question mark. no longer we have stimulus like during the pandemic. will that factor into the way consumers feel about their current financial situation as interest rates are considerably higher than they were several years ago. so, i think there's just a lot of question marks about the consumer. the whole, like, live for today because we don't know about tomorrow. good mantra to live your life by. i don't know if that's how consumers are feeling when they're trying to decide whether they should buy their next sweater. >> it's interesting. i was looking at a note today that was capsulizing the good guidance we got last week. we threw in there ross stores, tjx, walmart and even target, absent some of the other elements of that print that we got. and i just wonder if you think some of the guidance is based on wishful thinking going into the final quarter.

>> it very well could be, carl. i think what's interesting about that ross stores and tjx most specifically is how they obviously overindex in discretionary categories. an area we've all been really worried about. so, are they really just confident about their execution? i don't know. are they just thinking, look, christmas is a totally different story, right? people are always going to buy gifts, they're going to find something to celebrate in life, pointing back to that note from ubs. i mean, maybe that's some of it. maybe it is wishful thinking. ubs thinks there's a retail reckoning to come. i'm still surprised about that price action in target after that report. yes, margins improved but there was a lot of concern, i thought, still in that report. so, maybe retail stocks are due for a reckoning. we'll see if this very detailed note ends up coming true in the weeks and months ahead. >> yeah. a lot of information flow next few sessions, court. thanks. courtney reagan today on retail. another note grabbing our attention is jpmorgan, initiating qsr at overweight,

expecting nearly 20% upside. they sense a sea change in the business especially after last year's appointment of former davos chair. they expect international growth from burger king and horton's where some of the comps, kate rogers, have been impressive. >> definitely impressive and better than they performed here in the u.s. the headline of this note, though, does outline that burger king and qsr story is a complicated one. obviously the mention of patrick doyle, who laid the foundation for the technology pipeline, that has brought domino's so much success over the past decade is key here. he's one of those essential changes the note mentions being brought on as executive chairman. he invested $30 million of his own money in qsr stock to be held for at least five years. very much a vested interest in this turn-around happening. this 40,000 store growth unit will be achieved by 2029. it's going to be driven by this international growth in burger

king, popeye's and tim's. burger king in the u.s. is undergoing this revamp. that feels similar to what mcdonald's did under steve e easterbrook. as far as the back half of the year, we didn't see a lot of resistance from the consumer yet again in the most recent quarter. mcdonald's, chipotle, starbucks had all strong sales. starbucks and cava grew traffic, which is a challenge and not something you see across the board. i think you're seeing executives have a lot more awareness there's potential price sensitivity from shoppers. they're paying attention to any potential pullback or changing in habits of spend there. the downturn we've been warned of, that you just chatted about with courtney, hasn't materialized in the sector. in fact, the more expensive names for consumers in terms of meals, when you're going to dine out, the sweetgreens, shake shack and cava, those are some of the better performers for the

year. and fast food names like mcdonald's and qsr are lagging a bit. that's an interesting trend we've watched here. >> interesting, kate. you bring up a good point with regard to the more expensive options for people. what about the health trends that, you know, we've seen over the last few decades or so, people migrating to places they feel like it's quick but, you know, they're not necessarily, you know, unhealthy, per se. >> exactly. and that, i think, those names, leslie, are some of the names challenged by the changing dynamics we've seen with work from home and return to office. when you bring up health trends and quick, fast service names like a chipotle, like a sweetgreen, like a cava, for example, they are a little pricier. some have been challenged. you're seeing those names, interestingly enough, push into both suburbs and small towns. cava in particular focused a lot on dinner because lunch had been a challenged business. we saw that company turn a surprise profit in its first quarter as a public company.

that's an interesting trend there. one of the things piper sandler has noted as a tailwind for a cava in the back half of the year because people are more focused on health and wellness trends. i think that's potentially why you're seeing the names perform a bit better, even if they're pricier if you go to dine out. consumers are thinking about price and the big picture but they're potentially willing to spend a little more if there's perceived health benefits there when you're dining out. >> absolutely. it will be interesting to see what happens when, you know, those savings kind much get run down and the student loan repayment -- >> student loan repayment, exactly. >> still willing to pay up for the healthier option. seems like things are good to that front. thank you. >> thank you. after the break, wall street is wondering just how much rising wages could impact earnings. watching nvidia. higher again ahead of earnings on sense. hspc goes to 780 while baird names it a top pick.

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welcome back. workers at companies like u.p.s., gm and verizon are pushing for higher wages. the question for investors now, how will those costs impact earnings? frank holland has that for us. hi, frank. >> hi, leslie. $30 billion in new money, the teamsters say they gained this their new u.p.s. contract the union will vote on tomorrow, just one of the labor deals that have investors concerned about wage inflation.

that includes uaw and autoworkers, pilots at a number of companies like fedex, telecom workers at frontier and the teamsters say they plan to unionize amazon workers. data from nationwide shows inflation has not stopped equities from rallying. that spending power gradually declining while you see the broader market generally moving hi higher. >> you see more of the margin deterioration has been on a lot of the supply chain issues that hasn't necessarily been on pure wages. the wage growth has been a net tailwind, i think, for earnings. >> according to research from the san francisco fed, wages and benefits have increased around 3% since the start of the pandemic. if you use the labor department's employment cost index. however, their estimates show that has only created 0.1% core pce during that time. >> interesting. i wonder if something like that is screened through esg, you know, they look at the social issues as well. frank, thank you so much.

let's dig into the move lower we've seen across the major indices this month. our next guest calls it a healthy reset of expectations, moving closer to a sector neutral approach with an eye on potential slowdown later this year. joining us truist co-cia keith lerner. keith, you're still in the slowdown camp for later this year. >> great to be with you. the economy has been extremely resilient, but there's this tension between the fiscal dominance and monetary policy that's still, you know, tight and likely going to move tighter. we still think things are slowing down but in the near term, you look at the atlanta gtp, we're looking at a strong quarter but we think those rates will weigh on the economy later this year. we also continue to see some tightening in the lending standards as well. >> i see some lags out there. what are some other things you're focused on. >> well, more broadly for the market, you know, we came into

august thinking the market on a short-term basis was somewhat stretched and vulnerable to some type of corrections in time, meaning moving side ways or price, pulling back. we're seeing a little bit of both. i think the challenge be for the market right now is there's a lack of catalyst. we just got through the earnings season. and the earnings season was really good. the average margin of the beat was about 7%. but here's what the most interesting thing is, is, you know, stocks that had positive earnings actually declined. that's an unusual circumstance that we haven't seen often over the last ten years. so, we think we're just, you know, basically we had a lot of good news, a lack of catalyst and we're just digesting these big gains from the first half. just one last point is the good news is we are seeing that reset. we're seeing the amount of stocks oversold and sentiment come back in a bit as well near term. >> keith, what are your s&p earnings numbers for next year? are you tweaking that? >> yeah, you know, incentives are trying to predict a similar number.

we watched the earnings revisions numbers. what's underappreciated on the positive side is forward earning estimates are at 11-month high. a lot of negativity on earnings, but those earning estimates are continuing to drive higher. what's good about thispullback we've seen is we've seen the pe ofthe overall market contract while earnings are still going up. stocks are far from cheap on historical basis, but i think that's somewhat healthy we're actually seeing that reset. >> yeah. that's sort of -- i mean, that's definitely the bull food right now, is that positioning has had a bit of correction in itself, buyback window is opening up. as you said, that valuation not looking quite as rich. i guess i just wonder how far that carries you and whether or not you think conditions are ripe for any kind of chase mentality in q4. >> well, you know, the seasonal trends would suggest, you know, for the potential for better fourth quarter, the seasonal is just one thing. i will say kind of what we're looking for near term, carl, is

so far we're down about 5%. we have really strong support for this market, around that 4200 level. that was the old breakout point. that's about 3% to 4% below where we are today. one thing that is somewhat encouraging, we have an indicator that says what percent of stocks in the s&p are oversold, getting stretched. that's about 65%. that's the most since march. historically you don't go much beyond that unless you're back in a bear market. unless we start the season sanction the next few percent will be an important tell. again, these corrections tend to last one to two month. the average correction tends to be 7% or 8%. we're still in the ballpark of normal right now. at this point we think the primary trend is still higher. again, you know, in a choppy fashion and that's still our call today. >> as you look at your asset allocation, does that mean you're putting more capital to work in bonds and credit? you've got the ten-year yields hitting 4.35%, its highest level

since november 2007 today. we talked with bob pisani last hour about the risk-free premium and what you're getting commence sated for to take risk in stocks right now. are you changing your asset allocation to account for that? >> we're not changing our asset allocation yet. cash, stocks and bonds we are neutral. as we move up in yields, we think the risk profile is more attractive. if you buy yields today, high-quality bonds, even if yields continue to move up, you're protected on a total return basis to about 4.8% because of that extra coupon. we would say for investors that underweight fixed income, there's a lot of momentum. you don't want to try to call a top on the ten-year with all the momentum behind it. as you move up, we would be lagging into that. and, again, seeing, especially for investors that have a little longer time period, that's a good opportunity. and, you know, the good news is, we have that opportunity in yields now that we haven't had for the last decade.

both on the short end of the curve and longer term as well. >> a lot of attention paid these days to the rate complex. thank you, keith. appreciate it. >> thank you. coming up after the break, softbank's chip designer arm getting closer to its ipo. the latest details for what wall street calls the next big a.i. play. watching shares of amc, sharp move lower ahead of that stock conversion plan. the stock did start the day down ten. we're going to watch that, obviously down for the year to the tune of about %.25 almost a 2 and a half year low. e you heard of a town named dinosaur, colorado. we just got an order from dinosaur, colorado. start an easy to build, powerful website for free with a partner that always puts you first. start for free at godaddy.com

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soft banks are reportedly expecteded to layout. this is what to expect in today's tech check. it's getting interesting? >> it is. one key question, does this arm filing that will have to answer, is this a company that is a.i. centric or a.i. adjacent? the conditions for an ipo at the moment, a little mixed but certainly better than they have been in 18 months. mega cap has made a big comeback

this year, and over the last few weeks some of the year has come out of the tech rally and arm is not nvidia. its main business is smart phones, and it has seen a decline in the fiscal year. it's working closely with a.i. companies, but we're really at the show me moment, and investors want to see revenue derived from a.i. and not just told it's on the way, and we will see if arm does that. and it really needs a successful listing here and a liquidity event to go out and defense the bull defensive strategy, and we know him and he's not one to soft peddle anything, and another thing to look for when

the filing flips, and that's expected today are anchor investors. reports from amazon to intel to nvidia could play that role and that could help attract interest from other investors. isn't it nice to be on the ipo watch again? >> it is. >> we covered the class of 2019, 2021 and here we are in 2023. >> we should get our rest in now for what could be a busy fourth quarter. that's my question, how important is this deal for unleashing the floodgates for other companies, and there's a lot of pent-up demand for the new issues and this is one everybody is watching. >> to put it simply, yes. it's important. whether it prices correctly and sees that first day pop or maybe some of the air is taken out of it, and this recent transaction

valued it at $64 million, and instacart is a traditional vc backed company and it was established more than a decade ago, and that will tell us if the window is open for some of the other venture-backed companies, and arm lays the groundwork. instacart has been private for so long, and if the ipo window looks to be open even just a little bit, there's a lot of pressure, especially from its employees and investors that want to cash out for this one to go public. >> that's a good point. and valuation important for instacart most likely taking a lower valuation than it was valued at a few years ago, and showing the world it's okay to

take the medicine. >> and there's a huge difference between both of them, right? arm, whether you think it's a.i. centric or.iadjant a. ce. wealth-changing question -- are you keeping as much of your investment gains as possible? high taxes can erode returns quickly, so you need a tax-optimized portfolio. at creative planning, our money managers and specialists work together to make sure your portfolio and wealth are managed in a tax-efficient manner. it's what you keep that really matters. why not give your wealth a second look? book your free meeting today at creativeplanning.com. creative planning -- a richer way to wealth.

we have an interesting situation in the hedge fund world with the sculptor capital management. it has been for sale for quite sometime, and they signed an agreement with a real estate trust, and it's called rhythm. over the weekend we found out about this competing consortium of hedge fund managers that were looking to put in their own bid. they deemed it to be higher, about $12 a share. but sculptor came out and said financing is an issue, and we

don't believe they have enough of it. it will be financed by their own pocket books, and not lp money, but sculptor believes the consortium has under estimated on it, and it's a rare deal. >> yeah, the names make that story. we will watch that one. the dominoes are in for the judge. let's get to the post nine. welcome to the "halftime report." i am dom chu in for scott wapner today. our investment activity is joining me, joe terranova, and jim laboren thaul, and bryn talkington and steve weiss as well