giving away dvds. i'm thinking about getting a dvd player so i don't have to pay $50 a month for disney+. i think that's the best deal in town. you can't auto roll to the next one. >> all right, folks, thanks for watching "power lunch." >> dow is down 36 points. "closing bell" starts right now. i'm carl quintanilla in for sc scott. tech is doing the heavy lifting, nasdaq the big winner. tesla, moderna, nvidia all powering higher, despite bond yields, as kelly and tyler said, hitting some 15-year highs yet again, as investors await key earnings from nvidia, and of course the fed chair's speech at jackson hole on friday, which brings us to our talk of the tape and who will win this market tug of war, the bulls or

bears. guys, great to have you both. let me begin with you, john, and just walk me through whether or not these last three weeks this month of august, this correction of sorts, has come as any surprise to you. >> carl, great to see you again. a couple things i would say, i'm not surprised at all that we've had a little bit of softness. we had a very strong market coming off of the october lows. inflation peaked last summer, it's come down every single month and in the last few weeks we've had a lot of market participants saying we think recession fears are lower so they kind of jumped on the bandwagon. the fed came out and said we don't see a recession. i'm not surprised at all that we're getting a little bit of a relief. however, i don't think that changes really where we stand on many areas, although i'll get to it in a few minutes, i think some different areas and different sectors are getting more attractive. overall we still remain positive on the equity markets, albeit some areas have gotten more

expensive. >> greg, to start with you as well, i mean, you've been equally as resolute in your view, even though you do acknowledge parts of your view for, say, 3800, was a bill too early. >> right. and so the view for 3800 is based on what i see for 2024. and, remember, we're in three of my bear thesis. the first leg was the fed needed to raise interest rates in '21, when they didn't do that, i predicted a hyper inflationary environment in 2022, and then having to raise rates aggressively. there's consequences. what we saw in the first half, what i think screwed my timing up a little bit, is we saw a really significant amount of government stimulus and spending. when you look at the gdp number for the second quarter, a lot of that was government spending. we have the chips act, cares act, we had the bank bailout, the employee retention credit. we have all kinds of stimulus

that went in buoying the consumer in the first half. so the last leg of the thesis is what happens on the other side of that aggressive interest rate increase? i think we're just beginning to see some of that in the early cyclicles. we're seeing the consumer, the stretch and the pain that's being thrust upon the consumer, both in terms of those rising rates referenced in the last show, as well in terms of the record credit card debt, as well as in terms of other areas we're seeing consumers with stretched spending. so i do expect that to curtail in the second half. when you get a curtailing of spending and demand, when you get continued disinflation and the fed continuing to push buttons, the path to the third earnings in the third quarter or 8% earnings in the fourth quarter, and so if i can make

the math work, i'll get more bullish. but i can't see that right now. >> interesting, guys. as we're chatting, session highs as we're back to 4400, john. there had been a discussion that unless the market -- if the bears were going to break, like, for example, nvidia, we'll see what the rest of the week brings, without that whether we were in once again a dip environment. do you think today reflects that? >> it's interesting, technology has been the clear leader, let's not forget they were the most beat up. the nasdaq was down 35%, so i think it's very important to look at the technology names, meta, salesforce, google, amazon, these were left for dead in october. no one wanted to own them because interest rates were high. now you have an ai frenzy and strong fundamentals. i'll be shocked if nvidia doesn't put up a good quarter. those bode well. one thing i'm concerned about is

the reason that people sold technology they're ignoring, and that was interest rates. i think the real opportunity, carl, lies in the interest rate sensitive areas. so the areas that nobody wants to own. you need to look at banks, you need to look at rates, and you also need to look at china. china is being impacted by the dollar, which is tied to interest rates. all of those interest rate sensitive areas are on sale, and while i totally agree that the slowing of credit absolutely will have an impact on the consumer, you have a lot of discounting that's already happened, even with the comments that came out and downgraded some of the banks. that's not really surprising. that's like telling someone to put on sunscreen after they have a sunburn. that's out there and in the news. we have a lot of discounting that already occurred and there's real opportunities. and what if, what if we actually get a steepening yield curve? that would be a great opportunity for the banks. and the other piece i'll say and then i'll shut up, now you're

getting all the defensive areas which were egregiously priced back in october, building up to the recession play, those are on sale. utilities are trading at some of the cheapest valuations we've seen in ten years, in some cases. nobody wants them because they're tied to interest rates. >> no doubt, some of the new lows are starting to look awfully familiar. greg, if there are pockets you like, or is your macro view where you're not interested in equities whatsoever? >> i'm at 3800, so it's not that draconian. but going back to the financials, what we've seen is this should be a agreement environment for a margin expansion, yet that's proven hard to come by. even by some of those large money banks that were a recipient of all the troubles we saw in the first half of the year, even they couldn't produce

much in the way of margin. i think that will continue and i am less enthusiastic about large banks. i think some of the delinquency rates will be higher than we expected. and on the tech side, frenzy is a word akin to bubble, and indeed, while ai will be a secular tailwind, i think the market will use the next two quarters to sort out what companies like nvidia are having an impact on their business from ai, versus those where it might not be of the magnitude or it might be two years away. net-net, i think the market will start to refocus around companies that can deliver double-digit growth and can show us expansion. we saw some of that in health care, we saw some of that with palo alto, even though they give the investors a heart attack. that's what i'm looking forward

to as opposed to seeing ai as a passing fancy. >> a return rate around 6 1/4, if that's too light, it seems like the fed can preface for that friday? >> i think that's exactly right. you probably when i announced the prediction almost a year ago and it was seen as rather alarmist. and yet here we are with 100 basis points of that. so i do think that the fed, unlike some of us, do not see a continued disinflation. look at the last few reports. out of 23 categories, we had 17 that were flat or up, and only five that were down. of those that were up, half of them are up 50 basis points or more. of those that were down, it was the usual three, airlines, used cars and electricity.

so i think the fed's job is going to be very difficult after jackson hole, because i think they'll see a re-acceleration of inflation, not disinflation. if that's the case, they have only two choices, maybe three. they can pray for divine intervention, move the goalpost away from 2% or say that there's work left to do here. i think that will be the posture and i think that will be surprising to some of the market. >> it's a huge question. i mean, the doves would say just wait, shelter is our trump card. that's going to be played in the months to come. but is that too much of a responsibility on one play, to get shelter to play along here? >> i don't think so. it's a very large percentage of the cpi, and the way that it's done is a little bit archaic where they have to call folks and see what the equivalent rent would be. i don't think so. if you look at what they've done with interest rates, it's like if you were to shut off the

water down the amazon river, it would take time to have impacts. it might kill the crops right near the bed at first, but it would take time to impact the rest of the rainforest. there's no question what they've done is having a dramatic impact on the consumer's ability to be able to go out and consume because of higher rates and i think shelter is the slower piece. i'm not surprised it's been stickier. let's not forget that m2 is negative year-over-year, so there's indicators that we should continue soy -- inflation. and with regard to the 2% cpi, it may be challenging for them to get back there. again, i would not be surprised if rents roll over as you continue to see those numbers trickle through. a lot of people are not moving, the housing market is remaining tight and that's created a unique environment where it's buoyed the prices for longer than people expected. >> greg, as for sort of market sentiment and positioning, i wonder if you think once we gut

out of august, if volumes pick up, maybe we get the ipos, starting to find traction, if that creates -- i wouldn't say fomo, but definitely an area where those who have been thinking about how nice it's been to sit and collect 5% in a money market, their ears might get perked up when it comes to stocks. >> i think you just described june and july, that was our fomo, coming off relief that we didn't have more of a debt ceiling debacle that we had, relief that we're past any more silicon valley banks, and i think before that's all said and done, cre will have something to say about that. i think we saw that. i think what we're seeing now when you look at the activity over the last two weeks, is a market coming to grips with perhaps we thought all these things were certain, perhaps we thought it certain that the housing component was going to crack. we see no evidence of that. jeff is right, i agree, there's structural elements that

probably make this time a little different, most notably that 90% of americans have mortgages that are less than 5%. that stock is simply not coming to market. when you have tightness in the buying and selling of homes, you have tightness in the rental market. we've been counting on the housing component coming down every month in 2023, and it hasn't yet, which leads to the question, will it? no, carl, i don't think we're going to have a fomo moment, i don't think we're going to have an excess activity moment. i think we've passed that and we're now going into the consternation moment. >> interesting. john, it would be curious if we priced a lot of that in this summer. although if you look at years where stocks were up 10% at the end of july, i mean, they do tend to add a little more in the last, what, five months of the year. >> they do. we would not be surprised to see a back half rally and i think there could be a different group of stocks that leads in that back half. i mean, let's talk about

multi-family for a moment. you're seeing some of the cheapest evaluations over the last secdecades, you're seeing and 4% on mid america properties with healthy dividend growth. when you have a situation where home builders have egregious valuations, multi-family residential real estate looks very attractive. you have data center rates and some of the industrial. so i think there's a lot of pockets that are very sdodiscoud and you could see those move higher. after the fourth quarter of '18, that was a negative down quarter, the semiconductor scuffle between china and the u.s., you had a big 2019. utilities were actually one of the best sectors in that year, so you can see utilities, some of these areas that people are not looking at that are very

levered interest rates really perform well if you get an easing in the ten-year yield. >> we'll see whether or not the dow can go positive. greg, i am curious, the vix is back below 17 today. there are those who argue unless you've got the vix back above 20 -- i guess my question would be, in the back half of the year, in q4, are you looking for some disruptive shock to come and revisit, or do you think you're target can be led through an orderly fashion? >> i think it will be quite orderly, to be honest. i think the first salvo has already been fired, which we've witnessed over the last couple of weeks, with, again, as i covered already, when we dig into the inflation reports, we're not seeing significant continued disinflation. remaining in the 30 to 40 basis points range up until the last two months, we've seen that for eight months. so the market is saying, okay, at least some of the market is

saying, okay, what's next? something else needs to change for further disinflation. i think powell's speech will be the next leg and what will have to have is significant downward revisions. think the third quarter is likely too high. i don't see how we get to the flat third quarter and i think the fourth quarter is egregiously too high. i don't see how we get to 8%. i think when you factor in some demand destruction on the consumer side, as well as tighter financial conditions, that consensus has to take those numbers into account. i think that will be the leg is that does a very, very orderly takedown of the market levels, just like we saw last year. >> great debate, guys. especially if you two because you've been pretty res louis in your views. thanks. we'll see you next time. let's get to our question of the day. who do you agree with, john, our bull, or greg, our bear? go to cnbc closing bell on 'x',

formerly known as twitter to note. meantime, nvidia up another 7% today. our kristina partsinevelos here with what is behind today's move. >> hi, carl. another day passes, another bullish analyst report, this time hbc analysts raised their price target to 780 bucks. the argument across the board is simple, nvidia is the only ai chip game in town. the strong demand for ai infrastructure will continue to outpace supply, which is already constrained, and everyone seems to be just clambering to get these gpu chips. even today the telegraph reporting that the uk is looking to spend over $125 million u.s. on gpus, which could include 5,000 nvidia chips. bulls are calling for data center revenue to jump to $15 billion in future quarters, versus the $8 billion estimate for q2. a contrarian view, nvidia's

ability to guide materially above the current level is, quote, highly unlikely. if supply is tight, how are they going to keep guiding that much higher right now? the few other concerns, this current gpu shortage and gold rush mentality are almost certainly leading to double ordering right now, which might be especially true in china due to the fear of getting cut off because of export restrictions. so could that be a hurdle later on for nvidia? and if we're going to talk about the stock moving today, nvidia's contractor, taiwan semi is up almost 2%. today it reiterated its prior outlook in light of prior reports suggesting conditions have weakened. one name i wanted to bring up is analogue devices, higher ahead of earnings about 1% higher. there are some concerns, though, about analogue demand, and weaker demand coming specifically from china. >> i'll tell you what, the sell side is giving us a lot to chew on just on nvidia alone.

thank you. kristina partsinevelos. still ahead, investors may be buzzing about nvidia, but one top investor says there's another key name investors need to be looking out for. first, bracing for a breakout, chris farone forecasting a significant move in one part of the market. we're live from the new york stock exchange and you're watching "closing bell" on cnbc.

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level in nearly 16 years. our next guest says the charts are signaling a further move higher. let's bring in chris ferrone. >> thank you. >> let's talk about the solid five handle that sounded alarmists. you don't think so anymore? >> i don't think so. it's a paradox of what has happened since what happened to be a benign cpi print back in july, that was 50 basis points ago. i think what's important, when you put this in a historical context, the question we're getting from clients is why would rates still be going up? our answer is simple, when you look, rates trade at a premium to cpi, 200 average basis points over. so we posed the question this morning, is a 3% cpi number and a 5% ten-year yield number that out of bounds? not at all. >> chances we could overshoot? >> absolutely. if you do a breakout, you're

looking at 490 to 510. that's very much in play here. you've seen real ten-year yields break out above 2% and i think where this is manifesting itself is how the leadership complexion of this market, i think, has changed dramatically over the last 12 weeks. >> interesting. meaning we were, what, reliant on faang and now not as much? >> if we look since that july cpi print, energy is outperformed tech by 1500 basis points, discretionary by 1200. you've seen what began as a subtle shift actually become a much more overt move over the last couple of weeks. a little mean reversion today. i wouldn't chase that. i think that's a bounce in the down trend. i think ultimately the bigger message is that energy has reclaimed the flag of leadership and i think rates have a big part of that. >> so you're looking for some loss and momentum in technology in particular? >> yeah, and go stock by stock,

all those bellwethers have lost their 50-day moving average, more and more are starting to lose the 200 as well. so when you think about this in terms of where are the most attractive technical setups, what was tech for a good chunk of the year, i think that's deteriorated in a meaningful way. apple below the 50-day, microsoft below the 50-day. it's really nvidia the last holdout. they say the best ones fall last. expectations are really high for the wednesday number. >> for the nasdaq to go to the 200 would require something truly ugly, yes? >> it's funny, i think both of these statements can be true. stocks can be in a longer-term uptrend and also they can revisit their 200-day moving average in time. we forget that 15%, 20% corrections are not abnormal, particularly in an environment where interest rates are more volatile. so i'm kind of thinking about this more in a 1990s or 2000s, or go back further, 1960s type

environment where volatility in rates leads to volatility in equity. >> finally, home builders, do you think sledding gets tougher from here? >> i think you had the first meaningful crack of what was a very resilientgroup last week and it's a reminder that there's no untouchables in this market and you broke the 50-day on lamar and d.r. horton. i think they're oversold, they can probably bounce in the short time. i'm inclined to fade that. >> it's got to be a good year to be a chart watcher. everything is interesting. >> we joked the macro is getting fun again. it's getting interesting. >> yes. chris, thanks. coming up next, while everyone is talking about nvidia, there's another key report to watch this week. we've got an analyst who is bullish on that at-dn beenow name. tesla popping into session. what's driving that move? "closing bell" will be right back.

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shares of snowflake trading higher to start the week ahead of the company's results after the bell wednesday. stocks under some pressure this month as part of a broader pullback for the cloud sector. our next guest is cautiously optimistic the melt is over. he has a buy rating on the name. tyler, great to see you. i was thinking it must be nice not to be the name that everyone is thinking has to make or break the market. you do think we've seen the last of the guidance cuts, right? >> yeah. thanks, carl. it's been a disappointing year for snowflake. you showed how it's underperformed a lot of its peers just this month. but you look at it year to date, it hasn't done much or participated in the broad-based tech rally, and the reason is the company has had to cut the annual guide three years in a row. they've been surprised by cloud optimization headwinds, i.t. budgets have been under pressure. we believe we're nearing the end of this. they have interesting new

products coming, especially later this year into early next that we think investors are going to get excited about once we get through the earnings this thursday. >> it's been a while since service now really started talking about sales elongation, and certainly snowflake has had some of that. you're saying it hasn't gotten much worse, right? >> yeah, i think you're starting to see some light at the end of the tunnel. one of the surveys we run every quarter is we interview over 100 cios and the second quarter survey we ran toward the mid-june timeframe was the first quarter in about a year and a half where budgets hadn't gotten cut. they didn't go up a whole lot, but was the first quarter where you started to see budget growth expectations stabilize and sl slightly improve. we're hearing different things when we talk to channel partners both in the snowflake community, as well as microsoft and aws. a lot of folks really hammered on their cloud costs in the

second quarter and third quarter of last year, so now you're starting to lap those compares, and ultimately we think that can support a stabilization in the growth of these companies, and especially as you get into the back half of this year, set up a much better environment for the stocks. >> i wonder how you think about sort of the nature of their guidance in general. i guess i would argue he's not subtle whl he wants to deliver a message to the market, he doesn't beat around the bush with corporate speak. would you expect him to be direct on wednesday? >> yeah, i think he's always been a straight shooter. i think the concern maybe investors have had with the guidance is it hasn't been particularly conservative. a lot of these hyper growth companies will purposefully guide low to beat it by 9% or 10%. that's never been the way snowflake has operated. during the good times when i.t. spending was strong, it didn't matter too much.

but certainly having three quarters in a row where you have to cut guidance has been a problem and i think it's prevented some investors getting involved in the stock. ultimately our view is those headwinds are largely behind the company and we're expecting at least a reiteration of the full year guidance. >> talk for a moment about where it fits in your ladder of favorites. is this the top priority for you guys right now? >> yeah, so i would say in general we had more cautious on the sector. most of our ratings we cover are not biuys. we have a lot of neutrals and some sells. it's hard not to like microsoft. it's got a great accelerating growth story, levered to ai probably just about as good as anyone outside of nvidia. we also like names like mongodb and we have conviction in the fundamentals. probably call it in the third to

fifth place bucket. definitely toward the top of our list, though. >> right. and then is there a macro test that the names in your coverage universe need to pass, whether it's exposure to financials or ai or china or something else that sort of levers the favorites from the non favorites? >> yeah, for sure. so i think the nice thing about software is there isn't a lot of china risk. i think at most you're talking 2% to 3% of revenue. so you don't really have that. generally speaking, the end markets are very diversified, no more than 15% to 20% of a single vertical, generally the largest verticals can be financial services, some are in a retail kind of area. so i think the big test is just around growth rates. obviously interest rates are higher, to have a valuation that is as high as some of these names are, you really have to deliver on that growth. there's been a lot of excitement around generative ai.

and frankly, with the exception of maybe microsoft and a couple other names, you haven't really seen the results accelerate because of generative ai. so i think people are looking for growth rates to stabilize and improve next year, these software companies need to show it in the numbers they're actually generative ai winners. >> wednesday night is going to be pretty spicy. that will be fun to watch. tyler, thanks for the curtain raise. good to see you again. >> thank you. coming up next, we're going to track some of the biggest movers as we go into the close. kristina partsinevelos is standing by with that. >> well, dare i mention a new covid variant and what it means for certain pharma names? i'll also have details on one potential cybersecurity deal that has shares of double digits. all of that next. to duckduckgo on all your device

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just about 22 minutes until the closing bell. market has been leaning on tech pretty much all day long. nasdaq with gains of 1 2/3 percent, dow did go positive, despite yields really not giving investors too muchcomfort with the two-year very close to 5%. let's get back to kristina partsinevelos for a look at some of the key stocks to watch. >> we're watching sentinelone because the cybersecurity firm is exploring a potential sale. early talks have not made sense

in terms of valuations, so it's possible the talks could end without a deal. but you're seeing shares up 16% on the rumors. and the major covid vaccine players are higher today, and not because of good news. new variants are emerging and investors look ahead to the fall rollout of new booster shots. moderna, for example, is up over 10%, biontech around 7% and pfizer around 1%. those names are still down more than 20% this year as demand for the vaccines has declined. one of the hardest hit names in the space is novavax, going from a market company of $22 billion at its february 2021 peak to just around $700 million now. nonetheless, shares are seeing a big boost today, up 13.5%. >> thank you very much. meantime, some negative news surrounding china, putting some u.s. companies with exposure in focus. it could have a big impact on their bottom line. seema mody is here with details.

>> tech stocks have the most on the line with semiconductor companies like nvidia, eqqualco generating from china. china's economy is slowing faster than expected and pointing to names like intel and tesla they could be vulnerable to a further pullback if china's growth story continues to worsen. check out the performance of u.s. companies with china exposure labeled here, the china trade index is underperforming the s&p 500 so far in 2023, up just 5%. with that said, there's still a number of consumer-facing names like starbucks, marriott, even walmart reporting growth in china that's keeping some inves investors optimistic about a turnaround. the question is whether that can really happen if china is not able to meet the 5% growth target. >> it's interesting, wells took a crack last week looking at the

underperformance of names that had 15% expose tour china, and the number one name was las vegas sands, and ironically macau has gained it back from las vegas. it's an interesting story. >> it's interesting and it tells us about the consumer that even though we're seeing signs of outbound travel start to improve, we're still waiting for the full rebound to lead into other parts of the economy, which are slowing, for sure. >> one of the good things they have going. seema, thank you. last chance to weigh in on our question of the day. we asked you, who do you agree with on the market, john, our bull, or greg, our bear? you can go to cnbc closing bell on 'x' and we'll bring you the results after this break. ♪

let's get the results of our question of the day. we asked you, who do you agree with on the mark, john mowrey, our bull, or greg banch, our bear? the majority of you said john, our bull. we'll see whose right. coming up next, zoom reports in a few moments. we'll bring tu key themes and metrics. we'll take you inside the market zone. don't go away.

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and stay on top of the market. e*trade from morgan stanley. we are now in the "closing bell" market zone. ubs's julie fox is here, phil lebeau on the rebound in tesla shares, pippa stevens looking at zoom earnings in just a few min minutes. let's begin with julie. i would love to get your view sort of going into year end where it doesn't seem like you think there's a lot more wood to chop, and also shorter term it doesn't sound like you think there are major surprises headed our way out of jarckson hole. >> the market is taking a

breather, stocks have done well so far, august is a seasonably weak period of time for the market. we want to hear if powell is more dovish or hawkish in his commentary. this isn't a fed meeting in august and the next is still a month away, so we think this month's jackson hole meeting will be important. if you look at the meeting last year, powell said the fed's inflation fight could bring pain, and he was largely talking about job losses, and the market didn't like that phrase. we've seen job losses over the past year, but the unemployment rate is still very low. if you take a step back, we think that most of the market's gains are in for the year. our year-end s&p 500 targets is 4500, upside from current levels, though it would mean a year gain of 14%. >> and then i think your 12-month is not much higher, 4700. i just wonder if you think this is going to be a deadly 12 months or if there's going to be

wild swings within it. >> we acknowledge that the backdrop for stocks is improving, clearly the market has already run a lot and we think returns are a lbit more muted. as you said, 12 months from no s&p 4700 because we're expecting earnings growth through 2024 and that's compared to none this year. so as the earnings growth comes back into the picture, we think the market starts to price that in and we see this grind higher over the next 12 months or so. >> energy, consumer staples, industrials. it sounds like your sector view is supportive of a benign macro. >> yeah, i think we continue to see an improving environment for stocks and a better risk/reward than a few months ago. as you said, we're favoring sectors that haven't participated in the rally as much so far this year, and those are energy, consumer staples,

industrials, energy is only up about 5% so far this year. you've got rising oil prices, improving economic backdrop, and that does bode well for energy stocks. and we also still see opportunities in high quality bonds. it's the time to be locking in higher interest rates. we're probably near the peak of central policy bank rate raises, so you'll start to see the risk that you'll start to come down over the next year. so where there is the opportunity to lock in five to ten-year rates where they are, we think they're attractive. >> are you finding that clients are still a little bit non receptive to equities because the returns in money markets, for example, are so strong, or are they interested in hearing what kind of stories there are from an equity standpoint? >> i think it's about being selective and thinking about the risk/reward and trying to find the right opportunities in the markets and finding the sectors that have underperformed, like energy, consumer staples, industrials, and really trying to find the opportunities within the market where you can still have some of that upside.

that's what we're seeing clients thinking about right now. >> interesting. julie, appreciate that. we'll see what the next few months thing. let's turn to phil on the tesla pivot. the bulls have been wondering when this was going to come along. >> they've waited a month for it, carl, and it's finally here. a true rebound day if you are a tesla shareholder. what caused the stock to move higher today, after dropping about 30% in the last month? baird points out that cyber truck production is scheduled to start later this year, along with the fact that the price cuts have been effective. all of that contributing to tesla moving up more than 7%. the flip side, take a look at the shares of nikola, the company saying that the recall it initiated due to issues that caused a couple of fires, they hurt their 2023 delivery guidance. as you take a look at shares of nikola over the last year, the

company also issuing or saying it will issue $325 million in convertible bonds. the chair became ceo earlier this month. he's got on lot on his plate if he's going to stabilize the situation. back to you. >> really quick, today it's more about saying, look, the cost cuts we've implemented are going to mitigate. some of that loss, we've got to partnership with vw. is tesla riding alongside the general view of what chinese ev makers are doing? >> to a certain extent, it is, because china is the largest ev market in the world, tesla is the largest player within that market. it's insulated to a certain extent because it's a much better run company than a number of the chinese ev companies, which are truly start-ups that are just starting to get their legs in terms of production. so tesla is better capitalized and a better run company than many of those chinese electric vehicle companies. nonetheless, when they go lower

and the market goes lower, that weighs on tesla. >> china, talks of aws in the coming days. pi pippa, another name not going into the print hot. >> expectations are muted ahead of this report with analysts saying there's a lack of catalyst that could lead to a re-acceleration with limited visibility for margin improvement. that said, morgan stanley noting that q2 likely marked the last quarter of meaningful churn, thanks to deals that were signed during covid. so maybe some stabilization there, looking forward, as the company tries to expand its product suite beyond just video calls. in addition to opportunities outside, investors will be focused on commentary around ai, which zoom has been investing in, that includes timeline and

monetization opportunity, including meeting summary and chat compose, shares are about 1.4% higher right now. >> pip pa, we'll be seeing you n a couple of minutes. bob, looks like we're going together the best day so far. >> friday, 4340 right at the open and we're just passing 4400. you notice the dow was flat today. that's because it's all about tech and consumer discretionary and communication services. elsewhere, banks, energy, consumer staples, really weighing on the dow right now. this is where you see the differences in the market capitalization. the dow, of course, a price weighted index as well. two things, every single big cap tech stock is up, and, again, most of the bottom was on friday. this is the most important thing, 9 basis points for the ten-year yield, this would have been catastrophic in the last two weeks, and yet all throughout the day is s&p has

been rallying and has not dropped tech, not dropped communication services. this is a change in trend. we've been totally wedded, obsessed with looking at the ten-year yield for two and a half weeks, and today suddenly it stopped mattering as much. i think that's potentially significant. so right now there has been speculation that higher rates are going to somehow kill earnings, kill the rally, kill the economy. but i think it's all speculative still. we need some evidence that this install creep-up in interest rates we've seen are somehow going to alter the fundamental outlook. i'm not convinced that's going to happen. so i see multiples have come down since the start of august, we're at 18.5, close to 19, almost 20 times multiples. earnings estimates stable, but much higher for the third and fourth quarter. number is cutting numbers on these slightly higher rates. so far in august i see seasonably light volume, the vix

at below 17. it just dropped below 17. so i don't see the panic out there right now. i see a little bit of concern about the speculation on the higher rates and what it's going to do. but i don't see the evidence that it's actually going to kill anything right now. it's not going to kill the soft landing, it's not going to kill the earnings. so i'm just waiting for evidence and i'm waiting for powell to somehow come out and tell us why we need to worry about this. >> you mentioned seasonably light volume. does this mean we're waffling around through august or is anything decisive right now? >> no. put it this way, it's always decisive but there's nothing i'm looking at that i'm worried about. the volumes are seasonably light today. if there was really a problem, there a fundamental issue that people were convinced the economy was changing, you would see much, much heavier volume. people would be making bets. they're not.

all this is is lack of conviction if people want to buy stocks, not people looking to sell. the vix, if there was more concern over a 30-day period, that suddenly we were going to see a blow up, all the vix futures are sloping upward. that's not a sign of investor panic. if there was panic, you would invert the vix curve. you would have much higher vix looking at the cash and months out it would be much lower. that's not happening, we were below 17 just a little while ago. right now i'm looking for evidence that there's actually going to be real damage due to the slightly higher interest rates and i still don't see it. that's why everybody is freaked out about powell. they somehow think he's going to turn around and say, folks, like last year -- remember the speech last year? >> oh, yes. >> he said, folks, you don't see it, we're higher for longer and we're going to stay there. let's see what happens on friday. right now i still want to see more evidence. >> last year's jackson hole,

we'll never forget that. bob, thanks. >> pleasure. >> as bob points out, nice little attempt here at an afternoon rally. the dow will close a little lower here. let's get you over to "overtime" and jon fortt. [ bell ringing ] carl, you got your scorecard. finally on wall street, winners stay late. i'm jon fortt. morgan brennan is off today. coming up, the majority of earnings season is behind us, but we've got some major reports hitting this week, including nvidia on wednesday. today we will get numbers from one-time pandemic darling zoom. we'll have full analysis as soon as those numbers hit. plus, we'll be joined by council on foreign relations president emeritus richard haass to talk china as they're