the start of the pandemic. that's according to bloomberg, about 160 firms have moved their headquarters out of wall street since 2019, taking nearly a trillion in assets under management with them. it's been a rough day for the dow, all in the red. thanks for watching "power lunch." >> "closing bell" starts right now. welcome to "closing bell" here at the new york stock exchange. we begin with unsettled stocks, an uncertain market. here is your scorecard with 60 minutes to go in regulation. nasdaq barely holding on. falling stocks. stop me if you've heard this before, but it is again the story today, the ten-year reaching its highest level since '07 and stocks sinking into the red again. the nasdaq coming off its best day since july, but volatile today.

shares of nvidia were up and then rolled over. it comes ahead of their critical earnings report tomorrow. rest assured, tomorrow we are all over that. elsewhere, a couple of retail wrecks not helping the story, either. macy's and dick's sporting goods falling sharply on earnings for those companies, and then there is the banks, where more credit downgrades see those shares fall across the board, including most of the well-known regional names. it brings us to the talk of the tape, where it means a fall to fear for investors. let's ask gabriela santos, global market strategist. nice to see you. i look at your notes and you say this is not necessarily the start of something worse once we hit the fall. >> i think we've come a long way in a year and a half in terms of appreciating that the bear market is likely behind us, as we believe, and that we're back to seeing a normal period of volatility in equity markets

from time to time. so a 5% pullback once a quarter or a 10% pullback once a year within a bull market. that's where we think we are. since late july, we think this is good old-fashioned profit taking, you can really see that by the underperformance of those companies and sectors that had led before, whether it's large cap tech, semiconductors, home builders, or recently banks. so ultimately how far this goes, we'll have to see. it's seasonally a weak period and it will very much depend on what happens with earnings and cpi in the weeks ahead. ultimately we still have a constructive view of stocks. >> correct me if i'm wrong, you sound more positive on the market than you have been since we've been having these conversations. >> yes. and that has really changed since the end of may, because we, like a lot of people, came into this year expecting a hard landing, or it was always a conversation about a mild recession, but there was an

expectation of a recession taking hold mid year, combined with margin pressure on the earnings side. and since then we've had substantially better data on the macro front showing a normalization of the labor market but not a collapse, so that can still support positive consumption. at the same time that we've had better data on the inflation front, especially june and july, super core increasing only 0.2%. we've also had better earnings data. if you exclude energy and materials, energy is actually -- earnings actually grew in the second quarter. so we have now come around to this view of a soft landing, of the earnings recession being behind us. >> the problem with all of that, and it's all, of course, valid, what you've also gotten, higher yields. that's been the picture of late. since the start of earnings

season, the yield on the ten-year is up 50 basis points. the market is unsettled about where rates are. the stronger economy perhaps means higher yields than we thought and higher for longer than we want. what do we do with that? >> i think our conversations with investors the past two weeks have been entirely about this move in long-end yields and there being a lot of confusion about why that's happening. and i think, first of all, it's been a sudden move, 60 basis points since july, but it's also been the lack of clear understanding why. if we translate that to stocks, not all reasons why yields go up are the same for stocks. some are more positive than others. if it's really driven by a fear of a no landing or a re-acceleration, that's not good. >> is it a legit fear at this point? >> we think that's a bit overplayed. >> the no landing idea?

too strong economy for everybody to handle? >> for everybody to handle. first, if you look at break-evens, they've moved higher 10 basis points so it doesn't seem like it's really driven by higher inflation expectations. on the growth side, this idea that we're actually going to get third quarter gdp of 6% seems very, very unlikely. historically when it's over 4%, it usually at this point overestimates growth by 2 percentage points. we're still expecting a normalization of activity, especially consumption of services. that's a soft landing. >> okay, you need jay powell, the fed chair, and his panel to be your friend from here on out, don't you? in terms of jackson hole, a few days from now, what's the risk? the risk is that he's more hawkish than the market is willing to accept, right? >> i think more recently there's been an interesting conversation that's taking place, rather than

about the no landing fierce, it's migrated into a conversation about our star, so what is in today's economy a neutral real rate. and i think that's where there's an spec tag there could be interesting academic papers published at jackson hole. we'll be reading those on friday and over the weekend. and really it's about why our star could be higher. is it because we've gotten better news on productivity? that's a good thing for stocks. how high has that gone up, from 50 basis points real rates to 200? that seems very sudden. we really think it's just marginally higher. that's an environment that stocks can do quite well. >> what if we thought what was the neutral rate was a good place to be, the stronger economic growth that you rightfully cite suggests that the neutral rate isn't high enough. >> i think what we're really expecting for the second half of the year is okay growth.

so i think good news, bad news, is bad news good news? okay news is good news. so it's really a story of normalization and growth, a little sub-trend, a little below 2%, higher rates are still having an impact, and rates at nearby 5.5% are still way too restrictive given that implies a 200 basis point real rate. so we can see rate cuts even in a soft landing scenario. >> is that your playbook? do you think we're going to get rate cuts? if so, when? >> we do, and i think it's less of a mispricing for 2024, the fed is likely going to take its time. it's more about the estimate for 2025, which by the end of 2025 investors are pricing in rates at 4%. that's the 200 basis point real rate that, to us, doesn't make sense. settling in something closer to 50 to 100 basis points real rates or rates close to 3% seems

more reasonable. we've been advocating for adding duration as a nice hedge also against the more positive equity view. >> what about the lack of leadership, if you will, or the loss of leadership? you've had tech stocks sort of drive the train and now over the last, you know -- over this month they've obviously weakened somewhat. if you don't get a re-emergence of those names, the apples of the world and nvidia, which reports tomorrow, which seems critical given everything that's gone on, is that a problem? >> absolutely. and here is where this is the second biggest conversation we've been having with investors, which is even if we subscribe to a soft landing view and have more comfort taking on risk on the equity side, that doesn't translate into buying the market cap weighted s&p 500. there's a lot of discomfort with this record high concentration of the top ten companies at valuations that are 145% of long run levels. so, really, a clean way to do it has been -- there's been a lot

of conversations about equal weight approach, but we could even do a bit better than that by doing actual active management given that there's a much bigger dispersion happening not just between sectors, but within sectors between companies. so thinking in a non-zero rate environment about valuations, about quality, about different structural opportunities, and we find that in other tech companies, but also in industrials and health care and energy. there's a lot to do there beneath the surface. >> we'll continue that conversation in just a second. let's bring in lauren goodwin of new york life investment management. it's nice to see you. welcome to the conversation, one of which it certainly appears and sounds like gabriela is more positive on the market than she's been for an awfully long time. you've been in the cautious camp for a long time. what about her view? >> hi, scott, gabriela. one thing i agree on is this is

not the beginning of a protracted bear market. i am a little more cautious toward the end of the year because i think that something in current market pricing has to give. if the soft landing narrative is true, then i expect we would see stabilization or even modest re-acceleration of inflationary pressure, as gabriela rightly pointed out, i think that's tricky for yields and equities, the playbook we saw last year. or if we don't see that, then we see a mild recession, in which case the bond market pricing is more correct. in any case, i do expect that we'll see some equity market turbulence, likely closer to q4 when we see either new inflation data that makes us concerned or new economic data that makes us concerned. >> what about the pop in yields? gabriela obviously doesn't think that it's that sustainable from here. what about you? >> well, i agree with the point that the way we would see a

sustainable or stable, rather, increase in yields, one that could be constructive for the markets as a whole, is one in which productivity or potential gdp is pulled out further. that's likely not what we're seeing right now. what we're likely seeing is a little bit of confusion around the inflation story head, because in part, due to the data we've seen in the past couple of weeks, like outsized retail sales, this idea that the economy could be reaccelerating. the other factor that's contributing to long yields is the term premium, supply and demand issues with large treasury issuance on the table, with changes in monetary policy that are on the margin impacting demand for u.s. treasuries, these are all factors that can contribute to market volatility and for that reason we're actually not in the camp of adding extensive duration, unless you can do it incredibly tactically. this is an environment where, because the medium-term

environment for yields is so murky, we prefer short duration and corporate credit, adding duration only in sectors like municipal bonds. >> do you want to respond to that? >> i think for us the duration conversation is not going from record money market flows to 10s and 30s. there's no need to go that far out on duration. we think a sweet spot is neutral duration, where we would be speaking about a six-year duration, because that way you can lock in these yields for multi years, not just for a few months or a few quarters, you can also benefit from potential capital appreciation and you get the diversification benefit if fears about the economy come back. so it's more of a sweet spot. >> so, lauren, about jackson hole on friday, last year we all remember, what's he going to say, there was so much anticipation, it ended up being eight minutes, but it was a powerful eight minutes, because

between when he spoke in late summer last year and october, we hit the lows in the market. what's the risk this time around? >> well, i think that the risk is not likely to be meaningful news on the monetary policy front. last year jay powell had a very clear message to send, which is we're not done on inflation. this year he can continue to thread the needle that he's been threading, i think, with respect to we've seen some progress, but we're going to have to look at the data ahead. i don't think we're going to get much news on the near-term policy rate front. where we might see excitement is in this conversation about the neutral rate, which gabriela pointed out. if there is some sense within the fed that actually there is a marginal difference in the policy rate ahead, we could see what i would expect to be a tactical modest expectation change in long rates, because that would, again, reset the curve higher. >> is that the risk you see as well? >> absolutely. we're still going to watch 10:00

a.m. friday, powell's speech, but we think more important are the academic papers that are published. that's the theme of this year's conference. it's always very academic. this year it's about the structural changes in the fwlglobal economy and you've seen a rise in u.s. term yields and a global move in yields, a global discussion. so that's where we can calibrate the discussion. it's probably marginally higher, but not four times the level that it was before the pandemic. and that can help calm some of these fears. >> lauren, there are so sectors today that i think really sum up where we're at. financials have been weak, and now you have the down grade, the credit downgrades and the risks around that and the potentially weakening economy and what it means for stocks. let's deal with that and the idea that the consumer can only hang on for so long. i mentioned at the very start of the program macy's, dick's

sporting goods, stocks that are having awful days. and, yes, the consumer has been spending, but that spending has been tailored toward travel and experiences. we think that's going to continue and the ceos of those companies come on this network repeatedly and suggest they're seeing no signs of anything weakening on that regard. but what can the market truly do if financials remain as weak as they appear to be in the environment we're in? >> the market can keep doing what it's been doing, which is hold on. there's just been so much support for the consumer, details that we've been, i think, learning in real time, the policies from the pandemic for not just consumers directly, but to their employers through corporate programs, these remain important programs. now, some of them are starting to roll off, including student loans in the fall, and we do see mounting concern for the economy as a whole. i think this comes down to the foundation of our economic view,

which is so boring at this point, but the idea that when the fed starts raising interest rates, it takes 18 to 24 months to impact the labor market, even though the fed moved quickly this time. that timeline hasn't changed. so we do expect consumer malaise to begin to mount later this year, although not expecting outright declines in employment until the very end of the year. that's when we see the equity market turn. >> is it just a matter of time before the consumer runs out of steam? >> so i think in everything we've heard today it's not consistent with an idea there's a massive re-acceleration happening in the economy. we've been hearing from deta retailers and home builders have consumers being more value driven, more cautious of discretionary projects, about seeing credit card delinquencies going up. it's just that it's a normalization of spending patterns in our view, rather than a collapse in consumer

spending. and what helps that view is a normalization in the labor market rather than a collapse in hiring. >> i want you to answer the question, the next question. lauren, i want you to do it, too, and then we'll be done. the biggest event this week, nvidia's earnings -- we're going to ask our viewers the same question. the biggest event this week, is it nvidia's earnings, just given what's happened with tech recently, where the ai narrative has gone, or is it powell's speech? >> we would say for the s&p 500 it would be nvidia's earnings just given how much ai enthusiasm has fueled the equity market and giving the weighting of those themes in the index in and of itself. but i think if you look across assets, then the academic papers published at jackson hole are very, very important for the discussion on yields. >> lauren, same question. >> i have to agree. i think that it's nvidia because when it comes to the tenor of this market and some of the support we've seen in risk assets, that's where some of the

key questions lie, where i think for the next couple of months the monetary policy story is more established. now, one area where i would take a slightly different view than what gabriela suggested has to do withvaluations in the mega cap magnificent seven companies. not that they're not high, but rather the demand for semiconductors fueling the ai trend is not only high, but the main area of demand, the other six magnificent seven companies, they're not particularly price sensitive. and so while we do expect -- we do see the valuations particularly high, we know that valuation is not an important market timing indicator, in fact, it's not particularly helpful at all when it comes to market timing. so we're taking a more balanced approach with respect to tech, including mega cap tech companies, but also looking to the support of those companies, the digital infrastructure and

the new application companies that may come over time. >> it's going to be exciting. we'll see what happens. lauren, thank you. it's nice to see you again. gabriela, nice to see you as well, here on set with us. it brings us to our question of the day. we want to know what you think. what matters more to the market this week, nvidia earnings or mr. powell's jackson hole speech at the end of the week? you can head to the cnbc closing bell on the formerly known twitter called 'x' to vote. let's get a check on some top stocks to watch as we head into the close. kristina partsinevelos is here with that. >> let's talk about regional banks because they're lower yet again as s&p global downgrades several names. associated bank corp. and valley national's ratings were cut. why? well, there was funding risk and the reliance on broker deposits. that's why you saw them lower. umb financial and co-merica and

key corp. were cut. comerica down about 4%. at least the bank of monopoly is doing just fine. bank of america's raising its price target and reiterating a buy rating on hasbro thanks to the success of the monopoly go game, analysts say investors don't fully appreciate their potential to earn big licensing revenues from intellectual property library, including franchises like transformers and power rangers. all of that especially after we saw the success of barbie. shares up 7.5%. >> thank you, kristina partsinevelos. we're just getting started. up next, signs of life in the ipo market? arm holdings filing for its ipo this week. is this the start of a bigger boom in public markets? we're joined just after the break, we're live from the new york stock exchange and you're watching "closing bell" on cnbc.

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now's the time to see it's to die for. and it's all right here. streaming was never this easy, you know. this is the way. you really went all out didn't you? um, it's called commitment. could you turn down the volume? here, you can try. get way more into what your into when you stream on the xfinity 10g network. welcome back to "closing bell." chip design firm arm holdings filing for its initial public offering this week, in what could be a major test for the broader ipo market. our next guest says it could lead to even more activity into the end of the year. let's bring in star venture capitalist. it's nice to see you. >> how are you doing? >> it's been a minute for tech ipos, especially ones that are grabbing the headlines like arm

is. what's your expectation here? >> so i would say arm is kind of a tech ipo. what we're really looking for are the growth ipos like you might see in an instacart. but this is beggars can't be choosers at this part of the market and we're seeing that looks probably more similar to the j&j consumer spinout of a slow growth, but at least a tech company looking to do tens of billion ipo. so at least we're excited for that in the interim. >> you mentioned instacart, stripe is on everybody's list, i think. what are the other names you're excited about, and if you think they're closer, how close are they actually? >> so i think you're going to see probably data bricks, instacart. i think the conventional wisdom is plus or minus four or five high-quality companies that are willing to go out for various

reasons in q4. then there's another wave of companies coming in 2024, high-quality consumer companies like discord, high quality enterprise companies, similar to snowflake, that are part of the ai revolution that are capturing the ai zeitgeist, as well as having great fundamentals in their core business. >> will we be back to, quote, unquote, normal then as it relates to companies going public by whatever means they choose to go to the public markets? you guys as venture capitalists have certainly had to change your expectations in terms of timeframe, maybe size as well. are we going to get back to some state of whatever normal is? >> i think we're probably a year or so away from whatever the historical norm was. this is definitely a cyclical market. 2021 was a wild rush in the

market. i think there was 121 growth ipos at the point. last year was dead, this year has been dead probably up to this point, depending on if you count some we're companies that aren't really traditional growth ipos, like a cava or an arm. so it's going to take a little to get back to it. the first companies that go out tend to be very high quality, they tend to be willing to take a little bit of a hit on valuation, and they tend to be smaller ipos that want to get out. whether it's arm, because of the s softbank aspect, you hope that the first companies are high enough quality and have enough demand that they draw in the ipo buyers back to the market. >> the other piece of the capital market's pie are deals, right? >> yes. >> maybe some tech companies are emboldened by microsoft and activision and their beating the ftc, if you will. what does that mean for the appetite among big tech to try

and do stuff? >> well, i think you hit on the two key levers. the first key lever, especially for the larger deals, having an ipo as an alternative means that their window is not -- means if you're going to buy a company, the window might not be there for very long because the public market is an alternative liquidity source for shareholders of the company, and without the ipo market the bidders don't feel as aggressive or the need to bid before they miss the window. the second piece is, as you've alluded to, the ftc, especially under the latest leadership, has been incredibly aggressive in shutting out especially big tech from the m&a market of size, so they've had both a natural governor on them from a regulatory perspective and a market governor on them, and we hope that both of those things loosen up a little bit so we can go back to what we've seen as

the normalized m&a market. as you're seeing on the screen, the m&a market is down 50% to 70% from historical levels, which is bad for the entire ecosystem. >> the vc world, i presume, has its eye pretty clearly on smaller tech for obvious reasons, for much of what you do. but big tech has dominated a lot of the conversation. and i'm wondering what that view is from the periphery, if we can call it that, of an nvidia, for example, which, as we suggest, is so critical tomorrow for the earnings report in "overtime" that we're going to get. how do you view where that stock has gone, it's 200 or whatever percent it is to date, and now the pressure on companies like that to not only deliver, but to keep the ai narrative intact? >> i think you're exactly right. everyone is saying, how do you play ai? a lot of the companies are going to be meaningful and material

and the next generation of what was amazon or google are still private companies. so you can't really play them as a public equity shareholder. so you're looking to buy at this stage of the cycle the picks and shovels, which effectively nvidia is. so now you're looking to that one company as kind of a barometer of the health of ai, which is the current meme. so it's going to be choppy, i'm not sure what the earnings are going to be tomorrow. but hopefully they'll do a good job and you'll be able to see there's continued interest in ai across the board and people are building out the picks and shovels. but i hope people realize that this is a medium and long-term play and maybe interim quarterly results might be choppy on their way to this ai boom. >> they reset their own expectations with what they delivered in terms of the guide last quarter. we'll see. rick, i appreciate it as as well as. we'll see you soon. >> always great to see you.

up next, trading the uncertainty. morgan stanley's jim cairn is flagging a big buying opportunity. we'll get his take on a potential recession that could surprise you. later, your retail rundown. i mentioned the stocks earlier. that's just ugly. macy's and dick's sporting goods both sinking harin tayd od's session. we'll break down those moves ahead. "closing bell" right back.

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stocks losing some steam now with the dow heading for its fifth negative day of the past six. our next guest says any further downside could give as a longer-term buying opportunity. let's bring in cio of morgan stanley investment. nice to see you. >> good afternoon. >> bull trend intact. why? >> well, you know, the way we see this is that we've had a pretty significant earnings decline, first quarter, second

quarter, and the third quarter on the same path. if we believe, which we do, that we're going to avoid a hard landing, and we may have a mild recession, soft landing, however you want to categorize it, this could serve to be the inflection point where we start to see more of a broadening of the breadth and you see an increase in earnings potential as we move into 2024. for sure, i do expect we are going to see a mild recession, it could come in the first part of 2024. we could even start late this year. but the point, though, is that i think that the broader parts of the markets are already anticipating this and are reasonably priced for it. so as we start to roll the clock forward and as we start to think about this inflection point, if we avoid a hard landing, then if we start to see, you know, in my view, another 3% or so decline in the overall level of the equity markets, this becomes a very nice spot to think about what could be more closer to

$240 earnings and about a 19 multiple, and you could see levels of the s&p up close tore 4600 or 4700 or potentially higher. >> if you lay out your case that if you think there's going to be a mild recession, that that would suggest that earnings haven't troughed just yet, which would then suggest that the market is not potentially as, quote, unquote, reasonably priced as you just suggested it was, because the implication being that even weaker earnings potentially couldn't possibly be priced in? >> yeah, no, that's a good counterargument. and it is a two-sided risk here. we think that the asymmetry is still to the upside because effectively people are -- i would argue more underinvested in the equity markets. most people came in this year more overweight bonds or thinking about fixed income and less on the equity side. the recent couple of months has

caused some shift in that sentiment and some shift in that narrative, but i would argue that there's going to be more support in terms of buying on the downside than there would be selling on the upside, because people are already too wide at this point. if the markets were overextended long, then i would agree with you. but to the extent that i believe that i don't think that's the case, i think the markets are still underinvested in equities, that essentially that dip is likely to be more dominant and that's more supportive. so really what i'm looking at is continue asymmetric profile and i think the asymmetry still leads me to believe there's going to be more aggressive dip buying and rally selling. >> what about the backup in yields and what that potentially means for your projections on where we might go, if yields -- they're up, what, 50 or 60 basis points since earnings season began. if they remain higher for longer, what's the upset to what you just said?

>> yeah, well, i mean, it's really a question of the feds, how high are they willing to take these rates? if we get the slowdown, which i think that we will, this is actually good news for the fed. it tells them that they don't have to hike interest rates. so what i'm concerned about on the rate side is if the fed sees that we're having too frothy growth or if the markets aren't correcting, and that brings them into hike even more than what people are anticipating right now, then i think that would be very bad news. if they start to fall behind the curve of inflation and start to see that inflation as unanchored, that would certainly be very negative, because then the sky is the limit on how high they can hike interest rates. but if we see the slowdown, which i do think we're going to get, we are seeing a slowdown in the data, then i think that things stay higher for longer but pause. and i think that pause in and of itself is actually somewhat positive for the broader equity markets. >> i've been asking everybody,

so i'm going to ask you as well, because we're thinking so much about nvidia's earnings tomorrow. the importance of that report at this particular time, especially, is what? >> well, look, it's clearly importantly, it's very much a headline stock that's out there. we don't play it from a stock-to-stock perspective. i would say that it would make people rethink growth. but from my perspective the growth sector, i think the opportunity is more in the value sector. to the extent that growth has a correction, i think value is a beneficiary. i think it's significant, but i think it's significant for different reasons. >> because you can say that because you think the economy is going to still be better off than some would otherwise suggest, so a rotation there would make sense in your world? >> exactly right. that's exactly right. so for our thesis to play out, we need to see a broadening of the breadth. it's about the real economy growing and moving higher. it's not just about the growth

sector moving higher and dragging up the indices. i think that's unhealthy. i think we need to see the broader markets participate, and i think in a more healthy economic environment. so if we get a mild recession, the sooner we have this recession, the better off we'll be, because the sooner it is, the more mild it is. if it happens later in the cycle, then the more deep it's likely to be. so i think that if we have the slowdown, it's a good correction and i think we can reset, move higher, and the breadth of the markets will start to broaden because i think other sectors like industrials and materials and consumer staples and discretionary, all of those can start to participate in a much more meaningful way. >> so far it's the long talked about recession that hasn't happened yet, and i guess we're going to find out. i appreciate the conversation very much. jim kairn joining us. up next, we're tracking the biggest movers. kristina partsinevelos is back with us for that. >> there's a rare nvidia sell-off, but don't worry,

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about 15 until the closing bell. let's get back to kristina partsinevelos with the stock she is watching. >> thanks, scott. well, cosmetics company coty saw

customers splurge on expensive perfume and makeup but forecasted annual profits below expectations, the reason being is because of high production and labor costs, and those costs, along with the stronger dollar, are why coty plans to raise product prices. shares down about 2%. touted as the earnings report of the year, nvidia is set to report after the bell tomorrow. i know that's one of our twitter questions right now. shares are about 3% lower, but for context, it opened at its highest level on record, and after an 8% rally yesterday, monday, after yet another $700 price hike from a wall street analyst. separately, nvidia and vmware announced a new software product for customers to build in their own private data centers, versus on the cloud. this partnership demonstrates how nvidia aims to provide the total ai package, not just the hardware. be sure to catch an interview

with vmware's ceo coming up on "closing bell" "overtime." >> all right, we will see you tomorrow as we look ahead to nvidia and we look forward to that. kristina partsinevelos, thank you very much. last chance to weigh in on our question of the day, what is the most important event this week for you, investors? nvidia earnings or jay powell opens jackson hole speech on friday? het to cnbc closing bell on 'x'. the results after the break.

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the results of our question of the day, we asked what matters more for the market this week, nvidia earnings or mr. powell's speech on friday. the majority of you said nvidia.

i mean, it was close, though, 51.7%, 48.3%. next, toll brothers is reporting in just a few moments. we'll break down the key themes to watch. that and much morehen wwe take you inside the market zone. cheesecake cookies? the chookie! manage all your sales from one place with a partner that always puts you first. (we did it) start today at godaddy.com

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watching. diana olick is looking ahead to toll brothers after the bell. mike, yields very much a story today, and then you saw the vote from our viewers on the most important event, nvidia, and powell, pretty split. i'm wondering if you think we need, quote, unquote, favorable outcomes from both to sort of reverse this malaise we've had in august? >> i would say the first thing we need is for them to be out of the way, because honestly a lot of times it's the anticipation that's more crucial than specifically what we get in detail. i don't know that we need favorable outcomes for both. at this point there's a chance that fed chair powell has no real strident agenda in terms of market or positioning, it could just be we're data dependent, we're almost done but not there. nvidia is more interesting, the idea do we have to kind of convey the notion there's not going to be a place to hide and

it's not a secular growth story that's going to protect you against this corrective period. i'm not sure. i do know we tagged a 5% decline on the s&p, just tagged it. we got the sort of minimally acceptable oversold conditions going into friday's close. so it was sort of like enough to get you a bounce. beyond that, we're reaching for reasons for why we're doing anything. bonds are quiet, yields have been oscillating around flat. i don't think that's been a major push. the other thing is, we can come to some kind of an understanding and a peace with this yield level if it's happening for acceptable reasons, if the economy is truly resilient, it's not inflation getting out of hand again. and, you know, the growth proves that housing is not going to be killed by the yield levels. >> courtney, big story, dick's sporting goods, macy's. two ugly stocks. there's that, and now what we might expect from urban outfitters. >> and don't forget about

lowe's. lowe's beat on earnings, beat on comps. you've got macy's, that beat on earnings in revenue but disappointed on comparable sales. then dick's sporting goods misses on earnings, revenue, comps. you can see the performance, dick's down almost 25%, almost losing a quarter of its value. macy's down 14%. lowe's, the lone outlier, up almost 4%. bj's wholesale and urban outfitters reporting, each down about 5%. haven't heard from urban yet. we are expected to see comp sales grow near 5%. weakness expected in the namesake brand. double-digit gains expected for anthropolgy. they're downgrading shares on urban to neutral and it looks like investors have doubt as well after what they heard from other retailers in the specialty area outside of lowe's, if you will, today, on what we're going

to hear after the bell. >> thank you. appreciate it. courtney reagan, we will find out. the other story, toll brothers. i don't know what expectations are, but the stock is down near 7% in a week and 7% is a key number because mortgage rates are north of 7%. >> what a coincidence, right? it's all about mortgage rates. toll is expected to increase revenue and earnings as the luxury home builder capitalizes on strong demand. they reported while sales were down in every price category in july, they were down the least in the million dollar plus range and toll's average price last quarter was roughly a million dollars. they were outperformed by raymond james last month and i would flag the mortgage rate, the changes we've seen over the past quarter. the 30-year fixed was around 6.5% at the start of may but spent june and july solidly over 7%. in the last quarterly report the ceo mentioned improved demand,

combined with a strategy of increasing supply of spec homes. we'll see how that plays out in this new range of higher rates. >> thank you so much. we'll look forward to seeing you in "overtime" with that report. so, mike, we're going to have the two-minute warning in a moment. we're talking about rates and powell at jackson hole. this march higher in rates, 50 to 60 basis points higher since earnings season started, which maybe thwarted some of the good feeling and has done some of the work for the fed chair, maybe he feels a little bit better about where things are, given that, okay, let's cool things off a bit, stock market is taking a breather, too? >> there's a lot of sense going through the summer that while 500 basis points of fed rate hikes since march of last year really hasn't dented the economy, are we a lot less interest rate sensitive than we thought we were? it would suggest we're still consumer, the way consumer cyclical stocks have behaved,

macy's ceo talking about an uptick or normalization in credit delinquency rates, all of that feeds into the notion that you're going to start to feel a little pinch. and for everything that reinforces the advantage that new home builders have in the housing market right now, it really just feeds the idea that the overall housing activity is kind of hurt significantly by the fact that the existing home market has locked up. all that does suggest that there is slowdown. i think what's also happened is the move higher in rates, which coincided with the 5% drop in the s&p, that's not major, but it's also not insignificant. it's done a lot of what had to get done in terms of moderating off of extreme levels. i mentioned oversold condition. probably has more to go. everything is moving in that direction for a normal type of correction, pullback, reset in the context of slightly higher

yield numbers. >> directionry is positive today. >> you can't look at tesla. there's the bell. we're going to go negative on the dow, 185, as we settle out here. i'll see you tomorrow. i'll send you over to jon fortt. it looks like the nasdaq hung on by its fingernails. that's the scorecard on wall street. welcome to "closing bell: overtime." i'm jon fortt. two key reads on sensitive parts of the market are coming your way. we will get numbers from urban outfitters, following brutal sessions for macy's and dick's, follow troll brothers, and the ceo of vmware is going to join us to discuss the cloud tools and expanded ai partnerships partnership with na.