kranch and now giving it a new name. i can't wait to see what she's eating watching the next game. >> the new york "post" had her on the front because they have nothing else to talk about, biggest thing in sports is the fact that she's coming to watch this weekend. >> "power lunch" starts right now. welcome to closing bell. i'm carl quintanilla. scott wapner will join us shortly with rick r ied er. we'll get his take on inflation and how to play the bond market. but this make or break hour begins with stocks making another attempt to bounce after yesterday's late day come back i go on. tech holding pretty strong. communication services, materials leading the s&p higher. although off the intra day highs. which brings to our talk of the tape. rising oil, negative sentiment, can stocks brush off the sluggish september and rally

into october? let's bring in joe terranova, of course a cnbc contributor. and thanks for joining us. i wonder whether you think that given the intra day action today, is yesterday's bounce called into question or not? >> well, it is end of the quarter. just look at oil. oil $95 early. today settles 2% lower, significant reversal because oil was technically overbought. so there is a lot of dynamics that are playing out in the market. small caps are back, small caps have been brutal over the last quarter. so a lot of positioning going on. i think that you have to now look forward into q4 and say to yourself is there a a catalyst ahead of us and i think that it would be earnings. i think that is the catalyst that can restore the prevailing bull trend for the equity market. we need technology, which has seen a lot of earnings revisions higher here as you march toward the end of the quarter, and that

is somewhat inconsistent to prior seasons. it is going to be technology that is going to have to lead us back hire. so it is all about earnings. >> do you think we've already passed the period by which we should have been warned preseason? >> without question. generally as you move toward the end of september, once you hit labor day, usually you bury those negative revisions in to the headlines coming back from labor day. we didn't see a lot of that. and actually we've seen positive revisions so far for technology. somewhat yousurprising. >> nicole, i wonder whether we reset here, a better setup, maybe we get lucky on some surprises regarding a strike or a shutdown. and then that seasonality of the year. you're like i hope so. >> i'm like where to start. it is so interesting. because when you think about the major indices, earnings season in october, is it going to be good enough to excite the market. so we got blowout earnings from

nvidia and we didn't even see that much movement. instead you saw this underlying response from names similar to nvidia. so when we think about technology earnings mid october, can it carry the major indices into the end of the year. but we still have this distinct bifurcation, 490 other names when we look at the index on a whole, when we think about 2024 earnings, just to pick on them a little bit, we were looking at lululemon, and we see no movement compared to that of peloton with this partnership rebrand intent. and it is because if you looked at earnings expectations for 2024 for lululemon, we see the softening of a consumer, we're talking about the stronghold and stickiness of inflation. we're not pricing in these incremental cuts until now maybe the back half of '24. if we need earnings to pull us forward, are they really happening, are we going to hit the 10% year over year

expectation. because seven is not good enough to hold us through. and so how do you reposition then into the end of the year. >> i think the earnings catalyst is for the fourth quarter. when you look into 2024, you have to see a softening economic environment that is going to call into question when we look three, four quarters out that you will be able to get the double digit earnings growth. i don't know that you will see that. i do think that you set up for a bit of a chase for performance though in the fourth quarter. where money managers who have been behind all year, money managers who are generally equally weighted in their strategies, are going to look at a lot of the mega caps. and if they have strong earnings and are off to the races once again, i think that people will chase them. that could lead by the way to a critical inflection point in the market. >> i agree with you so strongly in if you can't beat 'em join 'em might be part of the mentality in q4. at the same time you might see

this pickup in purchase into small caps, just under a price basis. also corporate bonds. so if we think about we went into this year with these deep recession expectations, so for 18 months now, you've seen ceos make decisions based on recessionary expectations. and so when we think about moving down even in that investment grade bond sector, all of a sudden you are not thinking about the same credit environment that you are generally thinking of, the surprise or the shock to it. and so when you can pick up yields at 7% and think about the mark to market performance of an active element in the bond market, next year starts to play out very differently. so again i think this repositioning might not go just to beat 'em unless your mandate of course is specific to energy. >> so you are saying best telegraphed recession in a long time and corporate treasuries have had a lot of time to prep.

same with the consumer? because that is the other side of this is that until now, who needs to finance. you've got tons of excess savings. but when that dwindles away and they revisited financial markets so to speak, financing cars, homes, consumer living, that is when the sting really happens. >> i don't think that it is the residential real estate that is the big issue. because 90% of mortgages are below 5%. but to your point, i think that you will see a lot of people riding bicycles. obviously i'm kidding in that sense, but it is the auto loans. and you will see the maturity on a lot of existing a auto debt that will be very surprised when they go back. to me the only way, as i said, the economy in '24 is going to weaken. and the other thing that i think is critical for investors and viewers to think about, is maintaining the perspective that you need to position toward quality. quality is a factor has returned, outperforming the s&p.

so if you want to own corporate debt, stay high up in quality. if you want to own equities, stay high up in quality. and i think that is the reason why you've seen all these mega cap technology consumer discretionary companies year to date outperform because they are the very nature of what quality is. >> and also seeing some of them sit at these oversold levels for an extended period of time. which is some indication that there is a little bit of wiggle room. so the flight to quality seems concentrated across apple, meta, alphabet. and so i think that we have a bit more confidence in this run into the end of the year. it is though a lot about earnings expectations for next year. and i think that this is where there are a lot of headwinds in the fourth quarter. also, you know, some enthusiasm that one could have because you have such a concentration in the major names. but it is hard to understand exactly where to put money to

work today for next year and beyond. and that is the nature of the consumer, the retail investor, versus those of us who are running a specific strategy or mandate. so living on the consumer side that is where i think that you will also see some of the technicals not move. and that plays into expectations on the back quarter of this year. >> is any of this conversation relevant until the rate picture kind of moves out of the bull's way? >> listen, i think what is going on in the treasury market is less about inflation and more about heavy speculation, first of all. i mean, that is clear to me. it is very easy right now to speculate against bonds being short the treasury market, it is a lay-up trade. you don't have the foreign buyer demand that you previously had from china and japan. you've got this increase in supply to fund the deficit. i think $500 billion alone in

the last week. you have the federal reserve that is easy, hey, we're still thinking the economy is a little too strong, so they are not to your point on cuts, they are pushing out the potential for cuts. so it is a lay-up to me right now to push up against the treasury market and expect that yields will back up. near term that seems like the easy trade. >> are you also of the view that this move is largely technical, not matched by break-evens or inflation products? >> absolutely. and also just when you are in this every day, you see the fed's dilemma. we're at above trend growth. powell was very straight forward when he said that we're going to need a period of below trend growth. and at the same time, we know the reacceleration that will happen at this moment in time if they were to start moving rates lower. that is all indicative of the strong hold of the higher for longer messaging and also though the length of time, the duration we've been talking about the recession, has a lot do with why those of us who speak about this

every day talk about the shallowness of the recession. because it doesn't have that same shock and awe mentality where we see a tread crisis, where ceos are shocked and have to lay off. we've actually seen so much incremental movement and then we saw a lot of multiple expansion in certain areas of the market this year, so now we have this hyper focus on earnings. that is a hard positioning to perfectly play out for us next year when we're so interest sensitive. >> and i left out the fact that we're in the middle of qt. so while not an active seller, they are certainly allowing those maturities to roll off the balance sheet. >> dimon has been talking about it for a long time and now we're beginning to figure out exactly why. joe, nicole, thank you. our queftstion of the day, what will have the biggest impact on the next fed decision? government shutdown, rising oil prices or pce inflation. you can vote and we'll get you

the results later in the hour. now over to delivering alpha where scott wapner is with rick reider. >> thank you very much. thank you for coming to us right off the stage. appreciate you being with us. >> thanks for having me. >> saw rates ten year, 4.59, but backing up obviously. are we going to 5% on the ten year? >> i think that you have -- we have to get better data. we have a core pce print that will be super important. i think that will be a softer number. you can't tell with one individual number. and then we'll get in to the payroll report, jolts data to show job openings. those numbers need to be supportive because the treasury is issuing so much paper that the markets need to absorb a lot of it. so do i think that we can back up a bit from here? i think you can. i don't know if we'll see 5%, but we'll get into next year where i think it will be a different paradigm. >> do you think we're close to peaking? >> i think so. but you have to buy into the

fact that this fed wants to bolt down that inflation will be did yourbly softer over time. so could they hike another time or more, they could. my sense is that they should be done, but could you back up a little bit more, i think you could. >> this is interesting. you say my sense is that they should be done. are they done? s sfwh. >> i've learned invest relative to what you think that they will do not what you think they should do. i think they should have been done before. i think the idea that, gosh, we'll make sure that employment is not going to pressure service inflation, we want to make sure that wages won't be excessive. so i think that they will want to see a bit of time and they will watch the data for a period of time. >> and the reference is that powell doesn't want to make the mistakes of the '70s, you take your foot off the gas too soon and then everything is on the table. >> and i think interest rate tool is not nearly as effective as it used to be. i think we're waiting what happens. when you move up interest rates,

the pressure you put on things like commercial real estate, local banks, and you don't have the same impact on a service oriented economy like it used to be, but i think they still believe that tool can be helpful to bring inflation down. >> you mentioned something a moment ago, the massive amount of issuance coming on the market. ken griffin was on the network within the last couple of weeks saying it is a real risk hire real rates for much longer as a result of the issuance, and who the buyers be. you were on the stage in that room talking about the same thing. is that real risk, do people appreciate how hot a real rate might be for as long as they could be? >> i think when you actually break down -- you think about it, we're issuing 330 billion t-bills a week. and that number is going up, it will be 343 billion next couple weeks and then 373 by the end of the year. we used to issue t-bills at zero or 1%. now at 5.5% to clear all the

supply. what happens is the government, what will eat up all of the fiscal spend in the country will be obviously military spend from the discretionary side, but then the debt service is significant. and by the way, for the next year nobody will run -- no politician will run under let's bring the debt down. so we'll be in 00 bit of a challenge. and the cost of the debt service in the country will be significant for the next few years. >> what does it mean for the markets then? >> i think the markets, technicals in the markets, equity market can absorb the higher rates. i was talking about it on the stage. i don't think that people realize we're getting 330 billion a week of treasury bills, this week 134 billion of coupons. almost 500 billion a week. kuwaiti market, ipo calendar after instacart and after a.r.m. is 20 billion year to date. and we're getting 500 billion fixed income and 800 billion of equity buy back today. technical in equities are pretty amazing relative to the bond market. so i think that the equity market can hold in being on and

next year you can still get 8% to 10% return in equities. >> even with higher real rates? >> i think so. even when you strip out the seven stocks, you talk about it, you have 16 multiple when you take seven docks out, earnings yield while it is relative to tens not take attractive, but relative to history it is not bad. so i think equities will do their job. like this year? probably not. but i think they will be okay. >> when -- you say equal weight s&p, you look at the small caps, the bears will say that that is not where the cheap part of the market is, that is where the problem in the market is. and that shows the overall weakness of the market, not where the opportunity is. >> so we debate this all the time. if you take those seven stocks, you take tech generally, if you actually look at the free cash flow generation and your ability to continue to grow, i actually think -- by the way when you

break down the equity buy back, a huge amount comes from these big tech companies. so i think that you really need those companies big tech to continue do well for the equity market to do what it will do and then you make some decisions. there are places in equity, health care, defense, where valuations are pretty reasonable on what are stable businesses. great roe. i still think that they will do well but you still need the big tech companies particularly when cap spend is in and around technology. >> and you think technology stocks can continue on go up at the same time that rates do? >> like ins i say, i don't thin rates are going much hire. >> but even if they stay near here. >> yes, i think they continue to do well. again you get in that technical condition, there is actually not that much. you think about -- i talked about the equity buy back. if you think about you want to run a balanced portfolio today,

you can build a fixed income portfolio with an awful lot of yield and chip away at some equities. and then the technicals will continue to support it. >> what do you think of energy? oil 94 bucks in the neighborhood. >> my sense is that we're in and about this range. my sense is that we're probably getting close to the peak in energy. some of the stocks though were receipt reasonable. i liked some of the refiners and service companies. and you are trading at multiples that are not terribly high. even if you assume that energy is going to come down from where trades are, those valuations are pretty reasonable. >> people look at you as a fixed income person, but you are head of the global allocation team, which is why you think so hard and speak so smartly about equities as well. i don't know. when do the first rate cuts come? >> i think that -- steve liesman said something that i think is dead right. i think that the fed is in no mood to do it anytime soon. i think that you have to see

some durably lower inflation and pressure on employment. and i think what he said that i think is right, if inflation is coming down, we think core pce by the beginning of the year is under 3, so you have a fed funds rate that is in and around 5 1/2, if the economy is slowing as i think it is and inflation is moderating, that real rate is pretty darn restrictive to just get to what would be a normal restrictive real rate, you'd have to start bringing the rate down. and i think that -- and chair powell talked about his focus is on real rates. so if that is right, they will have to start bringing the rate down to be sim pa threat ittic sympathetic to where inflation is next year. >> recession or no? >> i think that you are seeing a slowdown in it, but boy, when you add up all the pieces of the economy, you look at the spend we're seeing on the infrastructure, you take capex, you take consumer spend, albeit slowing, listen, could we have a technical recession after

tremendous nominal gdp for three years? it is responsible, but i don't think that you will see -- sals interesting. people say we're going to recession, we're going to recession. but when you break out the component parts, it is pretty darn hard for the u.s. economy without some exogenous shock to have that drawdown particularly when you have the saving and deleveraging. >> and you can be that confident about that comment with the lag effect still so unknown? >> i think the interest rate -- the interest rate tool is unbelievably blunt. what it gets at -- when you lift interest rates, you gets at commercial and local banks, the lower income strata of the country, which is part of the reason why i think the fed should stop, but 70% service oriented economy. it is not like 30 years ago. the big companies that spend on capex are the big tech companies that are free cash flow positive, don't need to borrow.

people have locked in their mortgages. when you lift the interest rate, it gets at only a targeted part of the economy and actually doesn't get at much of the economy until you get -- you know, you keep moving. not saying it won't have any effect, but it is so blunt as a tool relative to what it was years ago. companies used to borrow on the commercial paper on the front end and finance and capital expenditure. now they fund out the yield curve. so it just doesn't have the same impact that it used to. so yeah, i think the economy can work through it. >> i think last time i had you on was when you announced the flexible income. >> yeah, we launched the ctf and creating 7% yield. been doing that this 36 years, and you don't have to take a lot of interest rate or risk, you don't have to take a lot of credit risk and create 7% return by buying investment grade

credit, using thefront end of the yield curve. pretty attractive. never really had that before. used to have to buy emerging markets and high yields to get 4%, 5%. you can get a 7% thousand. so people think about their portfolio, i'm going to own equities, private credit, other things. but boy, if you can get a pretty safe 6.5% to 7%, pretty good for fixed income. >> for those who say reach for duration now, you say not so much? >> we've been extending out to the three to five year point of the yield curve because when the fed starts moving, that will be your fulcrum. and you can extend a little bit. when you get this much supply of treasury paper coming and you have a fed that is in no mood to start cutting today, so i don't think that we're in any race today. >> appreciate your time very much. >> thanks for having me. >> rick reider. back to you. scott, thank you. and don't miss his sitdown with bill ackman. you can catch that live on

overtime this afternoon at 4:15 eastern time. we are following a developing story out of washington today. emily wilkins is here with that. >> of course the whole congress is really trying to figure out how to potentially overt a shutdown that is now scheduled to start midnight october 1. yesterday you heard house speaker kevin mccarthy say that republicans need to have some measure on border security be attached to a stopgap bill to prevent that shutdown. and the senate is starting to listen. you have members today that are beginning to discuss adding an amendment to the senate's bill that would address some policies over border security. senator john cornyn after having a small meeting with a couple of his republican colleagues on the potential change came out and told reporters that what they are focused on is who is basically let into the u.s. a lot of immigrants are come up to the southern border, they will be processed and then they are allowed to go into the u.s. some of them to await trials and court dates to see if they can

be granted asylum. that is would not big area that republicans think that is of concern to them.not big area th republicans think that is of concern to them. but it has to get democratic buy-in. that is one thing that senators were are very clear about. they don't want to have a government shutdown. they want to be able to move their bill through the senate and through the house. and at this point it is just not clear if that is going to be happening. but it is certainly something that is now being considered. >> we'll see how it moves the needle across the hall if at all. emily, thanks. we're just getting started. coming up next, jenny johnson will join us and we'll talk about her outlook for the economy, the fed and where stocks may head from here. we're close to session highs with yields down across the curve.

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it's a pitch. get way more into what you're into when you stream on the xfinity 10g network. welcome back. let's get a check on some of the top stocks to watch as we go into the close. hi, christina. >> and car max is having its worst day in a year after a profit miss. revenue fell more than 13% from last year as they saw persistent widespread pressures. shares are down 12.5%. shares of amd though are up about 5% after microsoft chief technology officer shared that microsoft was working with amd and, quote, they are making compelling gpu offerings and will become more important in the marketplace in the coming years. he made this comment at a code conference last night. and amd's new aigpu chips are

set to launch in december as an alternative to nvidia. share up 5%. >> definitely helping out tech today. and stocks are trying to get back to session highs this morning. joining us ahead of her panel at delivering alpha is yjenny johnson. thanks for the time. >> thanks for having me. >> i know your view is that the markets may have overdid it with the soft landing chatter earlier in the year. that is the financial laws of gravity still apply, right? >> yes, i do. but i do think that we're -- you know, i think the equity market right now is kind of a bond story, right? we've seen the 10 year at 4.6. i think that it is kind of an indication that people think that it is not up and then down. it is kind of up and a plateau. and if the cost of cash becomes more expensive and equity

markets represent future earnings, i think that we were due for a little bit of a correction in the market and some volatility. >> right. if corporates have had time though to adjust to that coming wall, and if consumer balance sheets have been able to pair down some debt, where do you think the stresses will appear to the degree that we get them? >> well, i think that, first of all, you know, i do think that we are in for a soft landing. i think that it can be managed reasonably well. but i think the ten year may reflect the longer term story which is just the story of the massive debt that we have. if you look back in 2007, i think we had about $9 trillion in debt. and now we're over $30 trillion in debt and about 25 trillion of that has to be funded by -- well, the fed owns 25% of it, japan is the largest foreign holder of u.s. treasuries and that is $1.1 trillion. you know, and this year's deficit is going from last year's $1 trillion to $2

trillion. soadded to our debt and that has to be financed. so you have to make sure that there are enough buyers out there. japan is seeing inflation, so maybe if rates start increasing, maybe they won't buy as much treasury. we've letteheard the story of c being softer. and so i think potentially if you have a lot of supply in treasury and not enough demand, you will see prices go down and yields go up. >> yeah, the supply/demand imbalance definitely a story lately. i do wonder how you view client interest in stocks versus, say, al sister in a differences which i know have been a big priority for you. private equity, secondaries, real estate, how is that competing to what might be a classic return to stocks when the picture got more benign? >> first of all the one thing that holds true at all times is people should have a diversified portfolio. anytime you get away from that, that is where people get this

trouble. but what i like now is first of all you are actually getting paid to be in the fixed income market. and whether it is high yield, 9%, or if you could actually withstand the illiquidity of private credit, you can get better credits at anywhere from 11.5%, 12.5%, that is like an equity yield. so that is why the bar for equities has increased. love secondaries. you've had just again a supply and demand issue which is you had $6 trillion deployed in private equity and only about $150 billion do he employed in secondaries and you are sitting there with lps whohe employed i secondaries and you are sitting there with lps who are overall low indicated for a variety of reasons and they need to get some of it out of their current investment portfolio to make room for new cash or capital calls.current investment portfo make room for new cash or capital calls. they do that by going to secondary providers. and they are seeing some of the

best discounts. not a reflection of the quality of the assets, but a reflection of not enough secondary managers out there. >> and there is also the ongoing debate about whether or not alternatives have been democratized enough for the average investor to understand, whether education efforts are out there, or whether they are just easy enough to get in and out of it. >> they aare illiquid, that is fact. but there are excess returns in the alternatives market, and i will liquidity premium. and it is important. and i make it akin to when my grandfather got into the mutual fund business. average investor couldn't have access to the equity markets so people came up with the mutual fund. we're in a similar inflection market. private credit has grown and excess returns are only captured

by really the wealthy. so we have to think about creative ways to responsibly bring that to the average investor. and i think there is some interesting things that we can c do, but it rares education. that is why i'm a big believer that people should use financial advisers because they have to understand the risk of i wi wil liqu liquidity. >> jenny, thank you. enjoy the conference. still to come, workday stock is down nearly 9%. top analyst is here to break down the move. we'll talk about what it means for the rest of the cloud space. and cnbc celebrates hispanic heritage, we're sharing the stories of influential span issuing business leaders with you. this is shopify's counsel. jess hertz. >> one of my mentors was justice sotomayor.

i was able to clerk for her. and i remember all that she taught me, not only from an academic how to be a good lawyer standpoint, but from a human empathy standpoint. and really paying it forward is an important part of how we all par take in a community.

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shares of workday lowered today. and our next guest says consider buying the dip. brent, let's talk about the stock which kind of wiped out all the summer's gains. sounds like you are pretty confident in management's response. >> yeah, they gave conservative guidance and we think the fundamental workday is in a great spot. you have the new ceo and new

cfo. and i call them the two best co-pilots that you could have. karl is one of the most inspirational leaders in software, zane was cfo in the airline industry and knows how to navigate turbulence. and this is exactly what you would do as a new management team. if you and i started at workday, we'd set the numbers low so that we can clear the bar. so just a classic indication of a new team coming in wanting to ensure that the bar is low. we think again it is basically an ol la goply. they are executing very well and we still think that the stock can drind to $275 a share. so we're buyers. >> and a bounce right on the 200 day here at 202. does it call into question any resilience, are you on lookout for tape bombs going into the earnings season? >> i think overall demand is

pretty good. we had the aci hype scycle. and their software off its high. we think the ai hype got too strong and i think reality has settled in that ai will be a slow takeoff, not a quick takeoff in software like we've seen in semis, it was a fast takeoff there. it will be a slow gradual approach. so we think the setup is looking good. overall demand looks like things are bouncing back. we're talking about a more resilient small and mid-sized customer given the rate hikes that we saw last year. so everything we're seeing in our work suggesting things are stable, valuations are come off, the ai hype has come off the top. feels like a pretty good setup for the group. >> that is interesting. i keep thinking back to mcdermott's comment at s.a.p.

about elongated sales cycles that got us worried. you don't think that we revert to that period of worry, do you? >> not at this point. i think a lot of the rate concerns and a lot of the jitters we saw at the beginning of the year we've worn through and i think that -- bill meck dermott is a great executer. he can cut through that and i think a lot of software companies are realizing how to get through some of the hurdles. never say never in terms of hey, could we see another leg down here. it feels from again everything that we're seeing including real time data out of the number one player, to this you are saying small and mid size customer is stable, enterprise demand signals look pretty good. so it feels good. so i think if we're going to see an issue in software, it will probably be more execution related than macro related. again, it depends on where rates go. if rates keep going higher, we may have an issue, but right now we don't see that in the data

we're looking at. >> definitely opened some eyes today. brent, thanks for the time. still to come, we'll track the biggest movers as we go into the close. christina has that. >> and the meme king is back in the spotlight and one chip maker's recovery is taking longer than expected. both those stories next. this is american infrastructure, a prime target for cyberattacks. but the same ai-powered security that protects all of google also defends these services for everyone who lives here. ♪

about 15 minutes until the closing bell. back to kristina partsinevelos for key stocks to watch. >> and let's talk about micron. shares are still down about 4% after a mixed q4 earnings report. they have called a bottom but road to recovery is moving slower than anticipated. yesterday earnings call they said they still need inventory levels to come down. they are still going to be impacted low double digits by a ban in china and they anticipate free cash flow to remain negative until the second half of the year. koef founder is taking over gamestop. in a statement they said that kaaya cohen

ryan cohen won't be taking a salary. and last chance to weigh in on the question of the day. we asked you what will have the biggest impact on the next fed sus tethbrk. reltafr e ea

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nike reports in a few moments. we'll get you a run down of what to watch when we take you inside the market zone.

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and we talked about how many different pictures nike needs to give us. >> yeah, i think we want to hear a little bit of everything. we always want to hear about everything. expectations i think overall are pretty muted going into the court. it is the fiscal first quarter we'll hear about today. there is lower apparel spending in china. so continued concerns. remember china makes somewhere between 15% and 17% of nike sales but over 20% of profits. and then there is also worry about conservative orders from wholesale partners still working to control their inventory and prepare for potentially lower consumer spending here in the u.s. and investors though also watching margins. you might remember last quarter profitability was pressured by higher product and freight costs and hire gher markdowns. the dollar was a headwind for the second half. if they give guidance respect it is usually on the call. so we'll stick around to get more details there.ect it

is usually on the call. so we'll stick around to get more details there.ct it is usually on the call. so we'll stick around to get more details there. >> and we talked about how people with student loan debt are being cautious about spending. and they did cut foot locker at the time and on a relative basis they were like you have to look at the tjx and walmarts of the word. >> absolutely. i think it was something like 54% said that apparel would be one of the top things that they would cut and somewhere are around 50% said that footwear would be next. and so you think about so many retailers that sell those product categories, and who potentially could be hurt the most and if we're also seeing some potential continued weakness or at least concern out of what is going on with nike's business and you know that about 60% of what foot locker sells is nike, you have two cross currents going on there. retailer selling all sorts of apparel and footwear and a brand specifically that is not as strong as now as it has been in the past. >> costco i know was earlier in the week, but they gave us good color on the cadence of consumer

mindset. they talked about christmas already under way. you talked about your own shopping getting under way. i just wonder whether or not that fits with some of the survey data that we've seen, the deloitte numbers looking at maybe not as much growth this holiday as we've seen in years past. >> absolutely. and we all talk about inflation and inflation certainly still plays a part in that. both in sort of what we're going to see for the total numbers, and you know inflation will be a part of it, because as sales rise, they have to rise above the level of inflation, that is key, but also what it means for overall consumer spending and how much we're willing to spend. and i think what consumers say in those surveys at the beginning of the season and what they actually end up doing can actually be two very different things. not everyone like me has already started holiday shopping here in august and september when surveyed. so perhaps things can change in the months do. but i think overall there is definitely more caution going into the season. just because of all the unknowns we've been talking about all day all week all month from the student loans of course, but

still rising interest rate environment that we're sitting in. and just all of the other pressures that consumers frankly have really fought through for years now. and i think that at some point you might just say enough is enough. and there will be a limit to that discretionary spending. >> we'll see what happens. obviously gas prices, employment, so many variables affecting the consumer mindset. >> absolutely. let's get to mike santoli. we'll talk about alpha in a moment, but i want to know whether holding yesterday's bounce, 42.38, pce tomorrow, yields giving us some cover today? >> a little bit of relief. pressure is off obviously from the bond market. i do think that it is still tentative. we certainly knew we were very oversold coming into the period. we know seasonals kind of get worse before they get better. but i do think that we're able to kind of mark our fears to market when you get some of the economic data. so weekly claims coming in.

you have the economy you thought you had. as long as we don't have the messy selloff in bonds, we can find our levels. but still below the august lows. so work to do. i don't think that anybody will say that it is a bounce to be believed. >> some of the bull/bear sentiment, bulls lowest since march. i wonder, do you feel like that was reflected today at the conference, is risk avoaversione primary theme you heard today? >> i would say in general people think that there are probably other shoes to drop, whether from some of the credit markets, whether the lag effects of what will hit the economy. but almost universally though people are kind of using that presumption as an anticipation to pounce. and so there is a sense out there that the world is giving you more opportunities in the way of safe yield that let you take risks in other interesting areas and that the markets in

general have become perhaps maybe more difficult but more interesting terms of trying to pick your spots. >> and in terms of sectors doing well, consumer discretionary up one, materials up one, kind of reminds you of the story that some had hoped to see play out, and that is that other elements of the s&p would make up for maybe artificial intelligence sentiment topping. >> yeah, there is no doubt about it. i do think that some of the hard hit areas when you did have this rate scare, some of the cyclical groups did give a lot of the performance. but they haven't unwound their advantage. so i do think that it is reassuring. semis of course another story out there you like to see as risk appetite. core pce tomorrow might be one of those things that could be a trigger one way or the other. i do think that we're now back at a more comfortable zone of evaluating the data as opposed to gist worrying that people are just selling off so fast.

>> glad we had a chance to talk before the close. mike santoli at delivering alpha as we finish out the session the dow up about 123. s&p just about above 4300. let's get to overtime. a lot of green. and we're brfollowing two breakg news events. nike will be announcing their results in a few moments. we'll bring you all the numbers and analyst reaction. >> and also this hour, bill ackman on the record, scott wapner will interview the hedge fund titan. and we'll bring you that interview right here as it happens on