manage all your sales from one place with a partner that always puts you first. (we did it) start today at godaddy.com good friday morning. i'm sara eisen with carl quintanilla from post 9 at the new york stock exchange. two dow drivers in reverse. apple shares get crushed as china orders its government agencies not to use iphones at work. ahead of its highly anticipated iphone 15 launch. the street's top analyst weighs in on the stock. the disney drama, its feud with charter. is it the beginning of the end of cable tv as we know it? stock at a ten-year low. rodney mcmullen, kroger ceo,

announcing a $1.2 billion settlement for opioid claims. not enough to sour sentiment. stock near the highs of the day. the conference call is going on. we'll talk to him about that and the latest concession in the company's effort to close the albertsons deal as well. >> stocks have been adding to the open. you have almost every sector in the green. industrials the only exception. vix back below 14 as we continue to keep our eyes on energy and yields and the dollar. >> yields giving some relief for stocks, art cashin says. playing along at hoechl, this is the only thing that matters, if you want to know the direction of stocks. if you see the lower yields, they come off the high and he's watching the 4.35 off the ten-year. we're well below that. you see the direct impact on tech. matt maley tells me to watch nvidia. a lot of attention being paid to

the big decline in tech overall but the overall market is holding up. let's bring in mike santoli, senior markets commentator. techs are holding up. some are wondering, can that last? >> that's the key question. can you argue if it's a tell or not. apple and nvidia down since the begin of september, 6% to 8% each, together they're more than 10% of the market. take those two out of the declines, you have outperformed even more. i think it's probably helpful that they both seem to be moving on their own particular dynamics. obviously the china policy issues. nvidia was one of those we priced in the best quarter ever. we got the best quarter ever. we're selling the news a little on that, but not really cutting into too much of those gains. all that put together means, for now, the market is differentiating and it's hanging in there okay. i think the credit market's ability to absorb a lot of

supply without really flinching. i mean, the spreads have remained okay. it probably supports us. we have had some weak beginnings to months in much of this year. in august it was the start of the month. we have to see if this is get back to the august lows, get oversold before we get more of a push higher. you look at the market and say, it's not giving me an extra additional reason to be too concerned there's something sinister going on. >> meanwhile, we continue to try to keep track of the comments that hinted inflation. mannheim with a hint, comments out of kroger, leading up to cpi next week. >> exactly. nothing is going to trump the actual inflation numbers but it helps along the way to reinforce that idea. there's a lot of argument and valid ones, i think, for whether, in fact, this is now the hard part for disinflation or whether it's really just the statistical momentum to the downside because of what's going on with shelter.

is this going to get us down to the target or not? we can talk about that and the market can pay attention or not to that debate. the numbers themselves are going to tell us. i think the fed being done, that's like the goldman sachs case is, in part, because of that. not because they're afraid about what comes next in the economy so much as, you know, we're going to be -- we're going to prove really restrictive at 5.5%, 5.25% on the fed fund if inflation goes much lower. >> do you agree the strong dollar is a headwind -- >> 100%. >> i'm not sure. >> i do. first of all, i don't think it's some huge defining swing factor, but if you just look at oil, the dollar and yields, they're all tightening one way or another. financial conditions at least, to a degree -- >> i looked at a liquidity chart. coming down a few trillion -- >> look at how great the market's handling it. >> not this week, it's not. >> a percent and a half on the s&p 500. i mean, i do think -- look, want

to talk about $1 trillion, $1 trillion year to day in equity funds. we don't have to work off a lot of extra optimism about stocks. also that feeds into the fed can be done because the market itself is doing some of the tightening around the edges. that's colliding with an economy that was maybe growing 5% in july on an annual basis. that's not the worst thing. >> don't tell atlanta. >> that's what i'm saying. >> we'll see. 5%, 6% at the last check. let's dig deeper into the macro with our next guest whether we get a recession, he says we can guess all we want but at the end of the day the market right now is not signaling significant trouble ahead. joining us at post 9, bespoke co-founder paul hickey. good to have you. do you think the runway to a soft landing has gotten narrower or not? >> you look at what happened this week with the issuance coming in. the market has -- we're down

1.5%. we've been spoiled. that's not too bad. it's september. i think in this respect the economy is in such an interesting position right now because i could come on today and argue that a recession is imminent or i could come on and say, we're early cycle. i mean, it's that nuts when you look at it. you look at leading indicators in the inverted yield curve, there are flashing signs. but when you look at jobless claims yesterday were very low. we track momentum in economic indicators. looks at over 40 different indicators to track how their year over year readings are trending. july, the most recent data, that was the strongest month we've seen in a couple of years and it's not the type of reading you see when you're on the verge of a recession. what we did see recessionary levels is last year we were at recessionary levels the entire time. we've seen a big bounce back. the indicators not necessarily really strong but they're moving in the right direction here.

>> that said -- and you've posted charts looking at the avenue to getting to target on cpi. a few things need to go exactly right. >> we had easy work on inflation has been done. headline inflation, it's going to be harder and a longer process getting there. next week we'll see at least 0.5% in headline cpi. core is going to rise 0.2%. 0.2%, that's a -- take the year over year at 4.3, which is a two-year low. i think the fed -- when inflation was coming down fast, the fed kept telling us, it's core that matters. it's core that matters. now that's starting to drift lower as well. it's going to be a gradual process. but i think what we're seeing is that the -- what we've seen officials say is we can take a wait and see approach here. we can see what happens with the data coming in. you saw kroger report that sales were slowing because inflation is cooling. you see walmart lowering entry level pay. we're seeing these things

suggest the inflation pressures are easing a bit going forward. >> the question is how much of that is already baked into the stock market, which as you started the conversation, has performed very well around this narrative, that we could get away with a soft landing and continue disinflation. >> the stock market certainly rallied on the pullback in inflation. when you look at what you've seen, when you've seen the types of declines in inflation we've seen, it has been a very positive omen for the market going forward. a lot is going to depend on what continues happening going forward. do long-term interest rates start rising more? do we see a new leg higher? they've been rising in the last few weeks here. they're sort of stuck in that range, the ten-year for the highs that we saw last fall and earlier this spring. so as long as we can stay in that level, i think the market can do, you know, just fine. >> i've seen some jokes this week that if if you bought apple or tesla on every china geopolitical headline, you'd be rich. do you think this has more bark than bite? >> i'm not a geopolitical expert

but i would say it's more bark than bite. this is posturing going on both sides. we see a lot of noise and not much happens. there's a rumor that apple orders were slowing again. if we had -- like you said, if we saw, you know, $1 for every one, we would be millionaires now. >> we're going to get the arm ipo next week. i wonder how that will impact sentiment, potentially flows. it's a big one. >> so, it's a lot of flows coming in. it's more supply but look at what we had this week. we had a ton of supply coming in on the corporate side. and the market has digested that. it is september. we have to focus on that. and when you look back, take a step back and you look at how the market's performed this year, it's followed the historical pattern almost to a t. that would suggest a little more weakness in the weeks ahead. year-end rally. the third quarter of the year is the weakest of the four-year election cycle during this year. i think that tells us that, you

know, you could see more weakness ahead. earning season just finished up and we saw decent guidance from companies. we're not seeing a whole lot of hesitancy. >> news flow will pick up next week. we'll have a little more wood to chop. thanks for coming in. >> thanks for having me. take a look at kroger. reversing earlier losses after reporting an earnings beat and reaching $1 billion plus opioid settlement. deflationary pressures proving to be a head win wind for the company. stock has turned around on the conference call. it's up 3.3%. the ceo joins us later this hour. as we were talking about with paul, is the apple ovseerll done. we'll talk about that when "squawk on the street" returns. the people who live and work there. because you call these communities home, and we do too. pnc bank.

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shares have been hit hard after reports of iphone bans for chinese government officials and state-owned firms. huawei is launching another competitor. eunice yoon joins us from beijing with more on the moves. >> reporter: it's huawei's phone in as many as two weeks. they're taking new orders for mate pro plus. it has a greater memory as well as storage than the mate 60 pro which the company launched last week when u.s. commerce secretary gina raimondo was in china. for that one the speeds are as

close to 5g as people can guess, although it hasn't been confirmed by the company. huawei lists another highlight saying it has satellite messaging from china's beidou system. apple suppliers sank on the news. apple suppliers were getting hit around by more reports that restricts -- or reported restricts on iphones at government entities has been widened to local governments. the nikkei has been reporting and quoting sources saying state firms have also put apple watches and apple airpods on the restricted list due to national security concerns. the government as well as apple haven't commented. the foreign ministry did comment on the u.s. investigation into whether or not huawei or its suppliers had potentially violated u.s. export controls.

the foreign ministry said that the u.s. probe into the nua way chip is under reasonable suppression, they said, of chinese companies. and it only strengthens chinese determination for a technological breakthrough. sara? >> eunice, is there a feeling this could expand beyond apple? >> yep, there's definitely a concern that this could potentially expand beyond apple. as of right now, most of what we're hearing are just rumors about where the companies could be effected. >> thank you. our next guest notes while this sort of u.s. tech ban isn't unprecedented, the hit from state-owned enterprises could actually amount to 5% of apple's global shipments. while iphones make up half of apple's revenues, it, of course, acts as a main driver of services. tony, do you feel the move this week on apple stock has been

justified? >> good morning, sara. i think it's probably a little overdone, but it's a broader refl reflection, i think, of more than just dyna. the stock had been up more than 50% this year and its multiple -- and it was all multiple expansion in contrast to some other faang names where there was real earnings growth. you had a robust valuation. there's some concerns about how strong the iphone 15 cycle will ultimately be. there's increased legislation in europe with the digital markets act taking hold next year. and then you also had this issue around a potential ban in china. so, i think collectively it's more than just china that has caused this pullback. but to your opening comments, yeah, if we go to the most extreme impact and this ban extended to all state-owned en enterprises in china, that could be a 4% to 5% hit to revenue.

and the stock sold off by more than that. i do believe it's not simply china that is concerning investors at this point. >> although you might also make the argument that this could be just the beginning of bad news for china. you know, this sort of state ban could be a precedent to a larger restriction potentially on consumers. just the idea of apple getting in the crosshairs of the u.s./china geopolitical tensions, which have only gotten worse in many respects. that's enough to scare investors, isn't it? >> for sure. there are a few existential risks to apple. this has always been one of them. certainly at the beginning of the trump administration, china/u.s. relations were very strained and there was significant concern there. clearly, that's a factor. but i think that would very

broadly hit the markets because apple has high exposure to china. but most companies do as well. if we had strained relations much more broadly, that would be quite negative for a lot of u.s. headquartered companies. >> that's a nightmare scenario, tony, we've talked about for years on some level. even in theory. what do you think apple's response would be, accelerate the migration of their supply chain, try to make up some lost profits by raising asps in other parts of the world? is that, in fact, what's happening? >> well, certainly trying to migrate outside of china is something that apple has begun more in earnest over the last few years. but manufacturing assembly is still 90% in china. our research suggests that it's probably three plus years to even get to -- from 10% outside

of china to 25% outside of china. unfortunately, that's a slow moving process. apple would do everything it could in all likelihood to accelerate that. from a revenue perspective, look, apple's always trying to maximize revenue in every part of the world. i'm not so sure there's anything magical -- any magic knob they could turn to all of a sudden make up for, you know, suddenly lost revenue. i suspect, you know, this would be something that would occur over time. you know, there was a ban on non-chinese pcs put into place a year ago. the timetable for implementation was two years. and, again, we don't know to what extent this will be. we certainly don't know the time frame for implementation either. >> anything change for you around the event next week, the big unveil on tuesday? >> no, not really. our belief is this will be

incremental rather than revolutionary new iphone. and, you know, we have globally speaking, you know, an uncertain consumer back drop. we're somewhat cautious on the iphone 15 cycle. but there's nothing that's come out over the last few weeks from a news flow perspective that makes us more -- incrementally more bullish but cautious. >> been at market perform for a few years. tony, thank you. >> thank you, sara. still to come, the ceo of kroger with us this morning. announcing it has reached an opioid settlement which comes along with more than $1 billion in payments to plaintiffs and a hit to earnings. we'll talk about that, results, a new deal to sell stores. heavy news day for kroger. the stock is near the highs of the day. up more than 3%. watching rh, stock adding to some losses this morning after q3 revenue guidance did disappoint. they say the luxury housing market will remain challenging

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welcome back. european markets set to close in a few moments. mostly lower. actually, they turned around, higher this morning. the stoxx 600 tracking. it looks like looking to break its eight-day losing streak, which would have been one of its longest since 2016. staying overseas, the attention this week turns to g20 and india. president biden landing there earlier and expected to meet with prime minister modi this evening. one person that won't be there but definitely talked about is china's president xi jinping. that's proving to be a benefit to india. >> china's president xi skipping this year's g20 in new delhi and president biden and prime minister modi are taking advantage of his absence to strengthen and deepen their country's ties. when biden meets modi tonight

they'll approve ge fighter jet engines and ga drones. we've seen u.s. ceos from andy jassy to google's, meeting with india's leader this week nvidia leader, where they announced they're making a language model for generative a.i. the pivot to india is under way. also showing up in etf fund flows as well with india seeing gains of around 7% this year versus china's fxi, which has lost a similar amount during that time. and morgan stanley, they're expecting another 10% gain in indian equities ahead of the nationwide election in april, guys. >> pretty interesting, as we get some headlines in the next 48 hours out of that summit. thanks. let's get a news update as well with contessa brewer.

hey, contessa. names were left out of the donald trump's georgia election interference case. the full special grand jury report from fulton county came out this morning and jurors actually recommended the indictment of former u.s. senators david perdue and kelly loeffler as well as current u.s. senator lindsey graham. those three politicians were not among the 19 people indicted last month, accused of conspireing to overturn the 2020 election results. trump and his codefendants have pled not guilty. the operation could launch as soon as tomorrow to save an american explorer trapped thousands of feet below ground in a turkish cave. turkish officials say the american scientist was on a mission to map that cave last week and he had a medical emergency, apparently bleeding from his stomach and is trapped below ground. the irs announced it will pursue 1600 millionaires and 75 business partnerships that owe

past due taxes. the commissioner says the crackdown is possible because of a boost in federal funding and artificial intelligence research tools. you may escape the audit, but you won't escape the a.i., carl. >> great. thanks, contessa. disney and charter still locked in this battle over this carriage agreement for its channels, including espn. even with the nfl season now officially under way. stock at a 2014 low. what's at stake for the media giant and what does it mean for the future of television? . plus, check out a few names moving on analyst calls. gilead, first solar, adobe, adveflake, they got upgraded. he or to cnbc.com to read why.

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dispute passing the one week mark. charter's chief chris winfrey stated a stalemate saying, quote, if i had anything material to highlight, i would, so that should tell you something in terms of how we're do doing. disney did rebut saying the company abandoned its customers and the street is worried disney is playing a bad hand. deutsche writes, the outcome will be worse for disney than for charter. disney shares, nine-year lows as this dispute rolls on. joining us to talk about it, julia boorstin and former amazon head of strategy matthew ball. it's great to have you both.

julia, the journal has a piece. of course, there's been a lot of takes this week but the journal's lead is the endgame for cable tv has arrived. is it that broad? >> i've been talking to a lot of sources and the consensus is this feels like some sort of tipping point. the fact that charter, a paid tv provider, would even consider moving forward without espn, which has been in so many ways the glue holding the bundle together, and the idea that this is because iger is bringing espn direct to consumers. that's something that he's planning to do. this does feel like this is the beginning of the end of an era or maybe just the end of an era of paid tv. and so i think something is going to come out of this. even if these two parties do resolve their conflict and they do come to a deal before there is nfl on abc and espn on monday, it does seem like the conversation has shifted. maybe people can start getting more content a la cart and the

bundle doesn't stay together. >> directv says taking our money and weaponizing it against us is a problem. are you surprised at how quickly this conversation has come out into the open? matthew? >> we dropped his line, i think. >> julia, out to you. the rhetoric does appear to be getting hotter, yes? >> the rhetoric appears to be getting hotter. and i think we have to remember that monday night really is the deadline here. it is a deadline because if charter subscribers cannot watch football on monday night, remember, charter has nearly 15 million paid tv subscribers, then this is really indicating that a lot of those people are going to go elsewhere. they'll go to youtube with live tv, hulu with live tv and the conversation shifts. a number of analysts have pointed out, the longer if this drags out, if this were to go on for two weeks or so after the start of the football season, the more likely it is these two

parties never resolve their carriage agreement and the more likely we are to see charter offering a smaller, less expensive bundle without disney's channels and increasingly, possibly, without sports. so, carl, i think the big question here is the era of the bundle over? and what happens when disney goes direct to consumer with espn? how much is that really the nail in the coffin of the paid tv bundle as we know it? >> matt ball, i believe you're with us, former amazon studios head of strategy. where do you think this goes? >> i think we're seeing this echo of what happened early in 2020 when all of the traditional media studios and companies were confident that streaming was lucrative and they would be winners. it was in early 2020 they began harvesting the best of their programming. whether that was "1883," an unupcoming paramount network, shifted to paramount plus,

"dancing with the stars" which bob chapek moved from abc to disney plus in its 36th season or the ongoing investment of all of the best new shows becoming hulu exclusive or peacock exclusive. the response to that is understandably hostile from the cable companies who are now being asked to pay more for what is less than was promised years ago. >> so, julia, is it the consensus among wall street analysts that disney has more to lose than charter economically? >> well, disney may have more to lose than that if they were to lose those 15 million subs from charter, they would be losing out on a massive amount of licensing fees, carriage agreement fees. there are so many other pieces of this you have to remember. hulu with live tv, which is, of course, hulu currently two-thirds owned by disney, has seen a massive jump in signups for the live tv service. it's a paid tv bundle. managed by hulu.

it does have espn and these other channels on it. yes, we'll see a boost of youtube with live tv and hulu with live tv. that would benefit disney. and then there's another piece of this. right now disney and comcast, cnbc's parent company, are in the midst of negotiating how much disney is going to have to pay to buy out the one-third of hulu comcast currently owns. we'll see an increase in the value of hulu and that means disney has to pay more for a piece of it. a complex situation here. obviously, if disney owns the direct-to-consumer relationship and they can get a lot of people to sign up for the new direct-to-consumer espn plus, they would benefit from that. we don't know is what consumers are going to want to pay for, what they will be willing to pay for a la cart and how this will shake out in terms of the new direct-to-consumer relationships. >> as if it weren't complicated enough, then you have the notion of the strike and how this affects those negotiations, especially given a lot of the

marginal players, this particular labor cycle don't have this labor -- or this linear tv albatross and are looking to reset comp. >> look, i think we can separate between three different types of companies being affected by the pipeline of new original content. those whose bread and butter is live sports or news. an area where wbd seems particularly advantaged. another category, which are diversified but have the majority of their supply, upwords of 60% to 70% of revenue and an even greater share of programming hours coming from international productions that aren't as effective. netflix being the leading example. then a company that's a little more traditional, whether an nbc universal or disney, that seems the most exposed to domestic supply of creative scripted content. >> kind of rings with what barry diller said the other day about the strange dynamics of this.

matthew ball, julia boorstin, thanks, guys. >> i keep thinking about bob telling david at paramount when david was saying, isn't this a threat to you? he said, they have their relationship, we have ours. it's not a broader thing. one week to go before a strike. the uaw is calling general motors' new wage hike offer insulting. they say a strike is almost guaranteed. the latest is ahead with ford and gm down big in the last month. regional banks set for their fifth negative week in six. stay with us. every day, businesses everywhere are asking: is it possible? with comcast business... it is. is it possible to use predictive monitoring to address operations issues? we can help with that. can we provide health care virtually anywhere? we can help with that, too. is it possible to survey foot traffic across all of our locations?

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time to peculiar a side. the autoworkers contract does expire next thursday and still no deal. our phil lebeau joins us with the latest. good morning, phil. >> carl, we're getting some wire reports that telanus meeting with the uaw and we're hearing what was offered. sounds like 14% pay raise over four years. gm was 16% yesterday. at least we're getting some parameters when we hear from

stelantuis investors have baked in some of these automakers with a baked in strike. most everybody believes come midnight next thursday night at 11:59 p.m. the contract expires and we'll likely see a strike. what's at stake for stellantis, 44,000 members. their market share, over 10% here in the united states. 11 manufacturing plants including 6 final assembly plants, which is one being the belvedere assembly plant in illinois, they shut that down. that's a sore point with the uaw. they want that to be reopened. as you take a look at stellantis as well as other automakers, ford and gm, keep in mind we have seen the exchange of offers. today stellantis revealing

details about its offer to united autoworkers. we'll see this now over the next week. quickly want to focus on the suppliers. i've had a number of people say, the suppliers are going to go out of business if there's a strike. they're not going to go out of business. but they will be impacted. remember, they get between -- anywhere between 50% to 70% of their business is tied to the big three, but they also do business with other automakers building here in the united states. no doubt there will be an impact, but the extent of the impact remains to be seen in terms of which automaker is struck, how long the strike takes place and what's the impact in terms of inventories. >> phil, are the automakers themselves bracing for a strike? i have to think they have been preparing. >> yes, yes simproo i'm asking because i'm wondering if they're ramping production way up in the weeks or months even ahead of this, and whether that could be distorting some of the economic data? >> well, i'm not sure if you can say it's distorting economic

data. they've been increasing production. they've been doing that over the last year, as much as possible. remember, they were coming off extremely restricted production last year because of the supply chain and the chip issues. as that has improved, those two issues have improved, they've been able to increase their production, which they have done. and they have much better inventory than they had a year ago. stellantis, by the way, has more than 100 days' supply for all of their brands. but jeep and ram are really the two in focus. they have more than 100-day supply. which means they can withstand a strike in terms of how much it will hit them for several weeks. but at some point, because you do not build -- you're not building any vehicles if there's a strike impacting you oz an automaker, that will ultimately hurt what's at dealerships. >> going to be a heck of a week next week. we'll watch it with your help. phil lebeau on uaw. want to bring you headlines from the fdic. they say the cause of first

republic's failure was loss of market and depositor confidence. they add the downgrade of first republic to problem bank effectively eliminated its ability to borrow from the discount window. finally, they say bank supervisors were, quote, too generous engaging the banks' liquidity levels. wonder if there are any surprises -- >> i don't think so. i think we've been talking about that for months. i guess putting a finer point. the regulator is still looking into it. the ceo of kroger is next on the latest quarterly results. their proposed deal with ttme tayns and how its opioid selentod could hit future earnings.

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welcome back. stock story of the day is kroger. shares are up 3.75%. they were down earlier premarket. despite the company despite the company reporting a $1.4 billion charge in the second quarter related to a nationwide opioid settlement. the settlement, we've learned, will be paid over 11 years including $1.2 billion to states and subdivisions and $36 million to native american tribes. kroger posting an earnings beat, but a miss on revenue and affirming guidance but he can inspects same store sales to be at the low end of the full-year range and slightly negative in the second half of the year. joining us on all this in an exclusively interview is kroger ceo from cincinnati. rodney, good morning. >> good morning and thanks for the invite. >> you got a lot of news out there today. always happy to have you.

let's start with the underlying business, what you'rereporting and projecting because the sales miss wasn't very big, but it does follow a very long streak of beating same store sales and strong growth, so what's happening? >> if you look it's bifurcated, customers are continuing to shop more with us meaningfully increase and the positive is the customer base is more profitable overall. if you look at customers constrained on a budget, that growth, the trends are improving but not -- they would still be negative and that customer is still under pressure from lower s.n.a.p. payments, lower interest rates and the inflation. it's a bifurcation and it also shows you the strength of the overall dismodel with some of those things supporting the growth overall in total.

>> talk us through that. what does that mean? that basket size s are smaller, people are going to generic and private label? how does it impact you. >> if you look, people are buying entry price point items, items more when it's on promotion, smaller sizes so it's an 8 ounce size versus 16 ounce size. it's happening throughout everything. now we would not consider our brands as jegeneric. certainly you see more of the entry price point items. >> you warn that disinflation and deflation is happening faster and that hurts. what are you seeing on prices? >> if you look at, like, eggs, milk, some of those categories or actually deflationary, which is really good for certain customers. as an example on eggs, before

they were $3 to $5, so it is helping. if you look at chicken and some of those things, lower prices there as well. it is helping that customer on a budget to be able to stretch their budget. it's all of those things together. we would still expect overall inflation to be in the 1% type range at the end of the year. >> what's hashl with market share, rodney, and price competition with walmart, the largest competitor? they point to strength as consumers prioritize groceries. >> on market share it gets back to the things we were talking about before. the upscale customer, loyal households we're growing in and there's good strength there.

if you look at the customer on a budget, that would be where the pressure would be. overall we're not happy or satisfied with where we are and we're going to continue to focus on improving from where we are. but the thing that's really important is we have been able to grow households and loyal households and they move up a loyalty ladder and spend more money with us. >> you said in the beginning that some of the pressure on the low-income consumer, you saw improvements. >> we saw improvements in trends there, but there's still more work to be done. >> got it. let's get to the second most important news you delivered today, the $1.2 billion opioid settlement. how does this compare to your own expectations, and how do you think it will impact business going forward? >> if you look at the national

settlement it was pretty consistent with others that had previously settled have paid. that will be paid over 11 years and was really important to be able to pay it over time so we can manage it in the business, and it doesn't affect the money we would be able to invest in. we can manage it over time, so it was consistent with what we expected and we'll be able to move forward where we are. >> do you think it was an overhang on the stock? and, if not, what do you think is? even bullish analysts saying the stock is chief relative to competitors. >> each a great question. i think part of it is if you look at merging with albertsons, what is it so we can model the company in terms of what it will look like going forward.

we thought the announcement was an important part of the overall plan and it moves us forward to get to a point investors can look at what the merged company looks like. >> right, so this is the third bit of news. unions are onboard? >> what we communicated was 413 stores would be divested. we're selling three brand names and license the rights to a brand. it would also include warehouses, incredible, talented local management team and private label brands. a buyer who is investing in assets because they love the grocery business, has been in the business for over 100 years

and they're doing everything to make sure we are there for their associates 100 years in taking care of those customers. it worked out well and is consistent with what we expected when we announced the merger last year. >> where are the unions on this? the worry with them is jobs are preserved. >> the unions we've had an ongoing dialogue and we're sharing the information. it's an open conversation. we've always believed, in terms of strong relationships, and a strong relationship with our associates, better security in the divested stores as well. if the deal didn't happen, be the only one who benefits are

nonunion competitors. >> a quick one from me on macro, specifically on labor and the degree to which it might add to margin tail winds, retail giants tweaking their wage structure for new hires where they're paying less than a year ago. is that happening at kroeger? >> we committed to investing over $700 million in incremental wages. the only thing we are seeing is turnover starting to be reduced. for us when turnover is lower, we have associates that understand their job better but they connect with customers better. we feel good where we are. we've always paid our average hourly rate is higher than the market and we have a benefits package that's amazing as well. we feel good about where we are and we're managing that and the turnover is nice to see it

continuing to decline. >> gear up for an instacart ipo, i know you've had a partnership with them and do delivery with them. what's happening with online grocery business and who is taking share? >> if you look at overall our online business was up 12%. it continues to grow. for us, instacart has been a great partner for several years and it continues to be. if you look long-term trends for people moving more online, getting more delivery. our business was up over 20% in the quarter. all of those things would point to where you would expect it to continue to grow. instacart has been a great partner for a long time. >> thank you, rodney, for taking the time today. rodney mcmullen from kroger. the stock is doing well today. >> i made a short list of things coming up next week. it's going to be very busy.

oracle, adobe, lennar, dreamforce, the apple event, barclays financial conference and, of course, the expiration of the uaw deal on thursday. going to keep us busy. >> we'll talk to the ceo of barclays, hasn't done a lot since taking on ceo. the bank, the business and the economy. >> let's get to dom chu in for the judge. thank you, carl. thank you, sara. welcome to "the halftime report." i'm dominic chu in for scott wapner today. front and center this hour, was this week a turning point for the markets? and what's in store for investors as we head deeper into what has historically been one of the weakest months of the year. our investment committee is here to help navigate you through all of it. joining me for the hour bryn talkington, steve weiss, and here on set shanion saccocia and jason snipe as well. where we stand at noon eastern time. a mixed market overall. the dow industrials up a