today as well where we see interest rates rising because there's concern about the size of deficits, the size of treasury r treasury issuances. >> the stock market is down 225 points. remember earlier in the show we were down north of 300 points, so trying to find some stability there right now. >> thank you for being here, dom. >> thanks very much. thanks for watching "power lunch." >> "closing bell" starts right now. kelly, thanks so much. welcome to c"closing bell," i'm scott wapner, this make or break hour begins with the major averages trying for five straight days of gains. that's clearly shaping up to be a struggle to say the least. rising rates, on that hotter than expected cpi report and a weak treasury auction right around midday. there's your picture. dow, s&p, nasdaq, russell all week. that's your score card with 60 minutes to go in regulation. there is plenty on the board, materials, industrials, staples drags stocks lower today.

it's pretty weak overall. you look under the hood, there's the picture from the three sectors i mentioned. financials, they're lower too as they get ready to kick off earnings season. citi, jpmorgan, wells fargo, all of that before the bell. tech, well, it was one of the only decent spots today. even it has rolled over. we show you the tech xlk etf. the nasdaq performing better lately and still on track for a relatively strong week, can tech alone carry the market higher into the end of the year as it did for the first six months of 2023. let's ask someone who count thes several tech names of top holdings. with us today at post 9, joe terranova, joe a cnbc contributor. it's good to have you both with us. amy first, we're still worried about rates, obviously. weak auction, cpi, ppi, both a little hotter than expected. how do you see it? >> yeah, i think, you know, the market is obviously on its toes.

you've got higher for longer. that's the bottom message. you've also got a number of market dynamics, whether it's strikes, whether it's oil prices moving higher. whether it's now geopolitical tensions around the world, all hitting the system at the same time. and quite frankly, the market's trying to find direction. we hope that the earnings season will hopefully provide that as we kick it off tomorrow. >> glad you mentioned earnings season. it does begin in earnest, and there's some suggestions that tech is really the only place that you can bank on for earnings season. that's still going to be good enough, if they come in good enough. joe's smiling because that's his suggestion, and i'll get to him if a second, but i want your take on it first. >> yeah, i think the bright spot probably would be tech, you know, you've got like take microsoft as an example. we're still expecting that it would be above consensus. we think that, you know, earnings, at least from the last quarter was up 21% on a year-over-year basis, and so don't forget these are also the names that have the strongest balance sheets, and i think capital strategies whether it's buybacks or dividends would also play an important role here, and i think that's going to help in

terms of the earnings profile. >> yeah, joe, i mean, look, that is your thesis here. it's why you've made a play into the q's more substantially of late. you think that's the place to be, and even if earnings aren't great, those earnings are going to be good enough, and that's the place to write it. >> the magnificent 7, plus adobe, lam research, broadcom, those are the names, those are the quality tech names. look at today, look at the price action today, whether it's consumer staples or utilities. look at technology, nonprofitable technology. hyper growth technology, biotech, dock usigndocusign, to. all down significantly. you're drawing the distinction between interest rate sensitive assets relative to assets that are not reliant on the cost of capital the, and in fact, the magnificent seven along with

some of the other technology names that i've mentioned are not reliant on that, so fortunately for the overall marketplace, they are dominant players in the actual construction of the s&p 500, and if, in fact, they're able to deliver earnings that are just good enough, i think you'll see resiliency. >> what if i say, okay, i agree with you. ky i can get my arms around the idea that these are the stocks that are going to have the better earnings, more bankable earnings. they're viewed offense and defense, but the market's different now. there's going to be more scrutiny on the overall market given where rates have moved now versus where they were then, and it may not be good enough to carry us higher alone because of that added scrutiny of just the overall more uncertain environment. >> probability for that does exist, but however, that's been the case for the entirety of the year. the rest of the market has under

performed. the rest of the market has not been contributing to the performance we're seeing year-to-date, and i don't expect that it will. you know, you mentioned that several weeks ago i bought the qqq, it was a seller of banks. i was a seller of nonprofitable software technology. i was a seller of biotech. so earnings is going to be incredibly critical. what we saw at 1:00 today with this treasury auction, it was remarkably powerful. i had a conversation with larry altman, who you know, scott, and we were questioning each other on when we could remember that type of a catalyst from an auction on the equity market overall, and what that does is it sets up november 1st tor be arguably the most important business day of 2023, not only because of what the federal reserve is going to do, but what the treasury department is going to do. on that day, you're going to learn what the supply is for five-year, ten-year, 30-year paper, and the treasury

department like the federal reserve is going to have to step back. >> amy, the fed done? do you think they're going to hike again? >> it's likely that they may have to hike again considering that cpi data as we saw this morning continues to be hot. i don't know if that's the right message now. i think it's really how much higher for longer is probably the bigger question looming over the market, if you ask me. >> but what if -- i'll give you that. but what if -- what if it's not quite this high, but it's still for longer, and it's just more normal? we're just normalizing rates. now, i don't know if the market can handle 5% rates and i'm not suggesting that it can, but if rates come down but still remain a elevated over historical levels is that really that bad as long as the economy remains strong enough? >> it really is a function of whether you're going from 5 to 4, and at 4, you're still 4 above what it was ten years ago. i think in this kind of market, smaller cap and mid cap players

that are a lot more sensitive to leverage, those are the players that i think will really have a tough time reinvesting and seeking capital, and that's why i agree with joe. these mega 7st or these top tech names is where we're staying at the moment. >> when you think about how long rates have been near zero, there are many people who have never known as an investor or anything but, so adjusting to a new and more normal environment still feels unsettling because we haven't lived, many of us, through a period where rates were anything but either zero or barely above. >> so what it does is it freezes capex for companies that don't have significant amount of free cash flow. just look at what's going on in the utility sector with next era energy partners, right? the renewable trade, which has to fund projects in the moment using the leverage they're unable to do so right now.

it freezes consumers who have been reliant on the cost of capital being basically free and are now witnessing a much higher entry point to lease a vehicle or to go skout and do some of t traveling and maintain some of the credit card balances. the economy one way or another is going to contract. i'm completely convinced of that. i don't buy into the premise that this is dpgoldilocks and we're going to have a soft landing. the economy almost has to contract at this point. i believe it will dismiss the third quarter gdp at 3.7 or whatever it comes in at. that's looking in the rearview mirror. that's not telling you the story. >> look at your top holdings, i feel like you're pretty much aligned to where joe's thinking is in terms of where the outperformance is going to be. alphabet, these are your top, let's call them six holdings or so. alphabet, visa, apple, tetra

tech, nvidia and microsoft. why such a heavy concentration towards the mega caps? >> we think that they continuously and historically speaking have delivered both on innovation, eps growth, we're still sticking with that balance sheet characteristic in a tough environment like the one we're in right now, cash flow is king and these are the guys that really have the free cash flow generation. >> yeah, so how do you look though, that's why people continue to nsinvest in them, a that's why in many respects they've had the leadership role. what about valuations? how do you square what their valuations are if we want to cite historical averages, many of them are above their tenure historical averages. >> you're right. valuation is a little bit higher than the market. in this kind of environment we will be comfortable paying a little bit higher for that balance sheet as i've mentioned and also for consistency. i think that's key in this kind of environment. >> the other side of that is the valuation of the areas of the

market that have under performed like financials, like some industrials, like materials, the valuation looks incredibly cheap, so it's important to remember that valuation, yes, it is critical in your fundamental analysis, but it's not actually sometimes a catalyst on the investment, because the valuation can remain cheap for an extended period of time, and the valuation can remain rich for an extended period of time, and that just might be the scenario that we have in front of us with the magnificent 7 as we move towards the end of the year. >> are there any other areas from those more depressed performance standpoints, more depressed valuation relative to tech that you like. >> you have to go bottoms up. just in the example of the industrial sector, there are companies like w.w. granger, copart, these companies are managing the business well, managing the balance sheet well, but you have to be active, and you need to go bottoms up in those instances because there is

this universal challenge x the magnificent seven given the cost of capital. >> how would you address that too? areas that have underperformed that, you know, on paper look cheap. certainly they look cheap relative to technology and com services. which ones, if any, stand out as being attractive. >> we like to balance technology with health care. that's one area that we also have some exposure in. hasn't made our top ten yet, but in essence, we think it does have characteristics, good cash flow, good balance sheet that can be a nice counterpart to some of the more volatile tech. >> why do you think it's underperformed to the manner it has. there are others who have picked this space early in the year thinking it would be a good place to be. and it just hasn't been, why? >> i think you're also entering a political year, scott. generally speaking when you have presidential election years, health care is the top of the game in terms of -- or top of the line in terms of whether

there's going to be health care cuts, medicare spending may be reduced, things of that sort generally are negative, political rhetoric tends to pick up. >> earnings season tomorrow morning bright and early, jpmorgan, going to be one of the companies reporting. it is on your list as one of your top holdings. it's by far the outperformer of all the banks in what's been a really disappointing and difficult year. jpmorgan is the only one that's really positive, like wells fargo is up i think 1%. jpm's double-digit percentage points higher on the year. why do you choose that over the others? >> again, we like the big money centers in this kind of space. i think jpmorgan has been very prudent in terms of their expenditures, in terms of their expenses. they've also been able to manage their net interest income and margins well, better than their competitors. we expect them to give us a little bit more on their outlook on that. >> what do we expect tomorrow? are we going to get out of the gates? this is somebody, by the way, who recently sold morgan stanley

and bank of america. are we going to get out of the gates and you know, the commentary from the ceos is going to be interesting to listen to. they probably have been more cautious, i'd say than most, certainly jamie dimon has over the last i guess it's fair to say many months. is that what we're going to get? is that going to color how earnings season starts? >> i believe it is, yes. i think it's rightfully so. jpmorgan is probably my single best equity trade of the year. i bought it in march in the midst of the crisis. i think jpmorgan has the ability to be the outlier to have some positive performance, net interest income is going to struggle in this quarter, but the acquisition of first republic actually is going to benefit jpmorgan. but i think scott collectively, the narrative you're going to hear from a lot of these money center banks is that they're going to have to have higher provisions for loan losses. because whether it's commercial real estate or whether it's consumers, the charge-offs are

going to increase year on year for sure. the securities portfolio doesn't look very good given the rise in yields, and i think there's going to have to be that acknowledgment that simultaneously is going to have somewhat of a muted if not discouraged tone. >> because you have the exposure you do to big tech and because you have the view that you do around big tech, and they don't report for another couple of weeks, are we essentially going to be in earnings no man's land, that the market's not going to really be able to do much until you get those reports? >> you have geopolitical headlines that i think will obviously drive the tape and certainly this afternoon is an uncomfortable reminder how powerful the rise in bond yields can be impacting the price of equity. so we are in a little bit of a place right now that makes me somewhat uncomfortable because my expectation is we could have a strong fourth quarter. >> yeah. how would you address that as well sorkt of an air pocket

before we get to the stocks that many are banking on to carry us, if there is going to be a year end run. >> yeah, i agree with joe. i think there are likely a lot of macro headlines if you would, i think there are also key players in different sectors that will be reporting, for example, united health care is a bellwether in the health care space. they're reporting tomorrow as well. i think there is likely to be some key players that will give us some insight into how those sectors are faring. >> i'm just looking, joe, someone's sending me a headline, thermo fisher, right, that's tmo? >> yep. >> that they cut their guidance. in the last day, speaking of health care, this whole new phenomenon of weight loss drugs has absolutely upset this group of stocks, joe, some of the hospital -- >> hca. >> yesterday were down sharply. many in this universe were down sharply. you have intuitive surgical and

striker, if i remember. >> correct, i do. fortunately we have limited exposure to health care throughout the year, the strategy has been reducing our waiting to health care, we were overweight health care one year ago, we are now underweight health care, so the strategy has worked effectively in that sensuous but the effect of ozempic is clear on a lot of the medical device names, the ihi was down significantly yesterday on the hospital's -- it's having a significant impact. >> what do we do about energy? obviously people are talking about it a lot, and i'm looking as i -- forgive me for looking away from you guys, but i'm looking at the sector performance today for the energy space, and we can pull it up there. you can see -- i mean, it's the only sector right now in the green on a reasonably down day, do you like it? >> in the long run, we have some exposure, but not a lot, and it's really because there's --

to us there's not a lot of ways to really think about cash flow for them, and the price of oil is obviously going to depend on supply and demand, a lot of macro factors that we don't have a lot of control over, and so from a fundamental standpoint, it's not top of list for us. >> how about you, joe? >> from a momentum perspective, i told you last week we kind of have this yellow light where the breakdown in oil futures reverse a ed a lot of the strong bullish momentum. positioning was very long when the price of oil was above $90. we've worked that off, but at this point it really is what's the direction going to be for opec plus? is it going to be that saudi arabi arabia, is it going to be that russia are going to add more barrels to the marketplace or not. >> by the way, we're are producing a ton of oil here more than we ever have before. i think i saw it's a record level of production in the united states compared tonight before. >> yes, 100% that is accurate. but i think we are in a police right now where the energy

market is waiting for information on upply, and also waiting for information on where the economy, what's the trajectory of the economy, the weakness that i see, okay, i think that's reflected in the price of energy and i think it's absolutely reflected in the price of gasoline. let's remember one week ago gasoline was reported on a seasonal basis. the demand was at a 25-year low. >> all right, we'll leave it there. guys, good to see you. welcome back, joe, we'll see you soon. let's get to the question of the day. we want to know will the s&p 500 be higher or lower one month from today once earnings season starts to wind down. you can head to @cnbc closing bell on x to vote. we are just getting started here on "closing bell." up next, star witness and former girlfriend of sam bankman-fried wrapping up her testimony after nearly three days on the stand. we'll bridgeng you a live repor

from outside the courthouse. we will take you there live, we are live from the new york stock exchange, and you're watching "closing bell" on cnbc.

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running up and down that field looks tough. it's a pitch. get way more into what you're into when you stream on the xfinity 10g network. our s&p sector heat map. we do have two sectors at least in the green, energy and tech. tech barely hanging on, but energy is the modest bright spot today, otherwise it's a lot of red on the board today. let's get a check on some top

stocks to watch as we head into the close. pippa steven ss here with that. >> there is more trouble in the staples sector with hormel sitting its lowest level since 2018. union employees voted to ratify a contract that includes the largest wage increase in hormel's history. separately, executives are laying out long-term financial targets at the company's investor day today and the street is underwhelmed, those shares down 11%. and keurig dr. pepper is hitting multiyear lows as bernstein cuts its price target to $37 per share ahead of earnings in two weeks. that follows citi reiterating a n neutral rating citing lower coffee volumes. those shares down nearly 5% today. >> we'll see you in just a bit. we're following the latest developments out of the sam bankman-fried trial. our own kate rooney is outside the courthouse with the latest. >> karen ellison is done testifying.

we're waiting for her to leave the courthouse behind me. you may see her walk out during this hit, but the defense team today really looking to show inconsistencies in her testimony, unclear how the jury will react, but it was a bit hard to follow in the morning, especially they did not appear today to have any big a ha moments. we didn't hear big bomb shells from the defense team. attorneys for bankman-fried jumping between topics. they did try to paint ellison as a bad leader and sloppy manager, one example a failure to hedge from market losses. there is talk about jealousy with another hedge fund, there was a quote about wanting to crush this other hedge fund. this all comes after really explosive testimony we got yesterday. ellison said after the two crypto companies filed for bankruptcy, quote, i felt a sense of relief that i didn't have to lie anymore. she said she had been living in a constant state of dread every day. this also comes after yesterday there was a side bar which we couldn't hear in the moment. we did get the court's

transcript, scott. the government attorney accused bankman-fried of scoffing, shaking his head during ellison's testimony and said that given the history of this relationship and the prior attempts to intimidate her, the power dynamic, their romantic relationship, the lawyer asked that the defense counsel tell him to control his visible reactions to her testimony. the judge then asked the defense team to speak to bankman-fried about it. there was some awkward tension in the room. these two had not seen each other since the collapse of these companies in november. the jury was very tuned in. we're going to get our next witness this afternoon, but caroline ellison the star witness of this case. >> we'll keep our eye on the door as well, and show you those live pictures when caroline ellison does emerge from the courthouse right behind where kate is standing. thank you. we'll talk to you again soon. up next, stocks lower as we head into the close. the dow is now down about 189 points. coming up, breaking down his

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the fed may interpret today's cpi report, edgar denny, he's the president of yardenny research. does today stay consistent with your thesis, or does it upset? because you've been more bullish than most. >> yeah, i'm not changing anything. i think the federal reserve is done raising interest rates, even though the inflation was somewhat hotter in the numbers that came out today. a lot of this problem is actually rent. you take out rent out of the cpi, take out shelter, which includes rent, the cpi both headline and core are up only 2.0%, so excluding shelter, we're actually at the fed's target already, and shelter inflation we know is going to be coming down. i know we can all look more closely at the cpi and find areas where there's going to be some reversals like in health insurance, but i think the fed has to look at the overall number, and the overall number

suggests to me that inflations turned out to be transitory instead of persistent. and i don't think it's very sticky. i think fed officials are looking at what's going on in the bond market and concluding that the bond market's done all the heavy lifting and they don't really have to raise interest rates anymore. >> shelter, hough, ed, is a critical component of where inflation was and why it's been so difficult in getting it down. it's also key on the fed's mind. i feel like -- you don't feel like you're being too dismissive of what for moany is a critical component in this who he has conversation. >> you could accuse me of what economists do. take out the numbers that don't support your story and say i told you so. >> you said it not me. >> forgive me for interrupting, there's caroline ellison leaving the courthouse getting into the

suv. she's leaving the courthouse, wanted to listen in for a second see if she would answer any questions shouted by reporters on site, including our own kate rooney after three days of pretty damning and explosive if not shocking testimony against her former boyfriend and the head of bankman-fried. we'll keep our eyes peeled there and go back to kate as needed. ed, i'll come back to you. as i was saying you're sticking to your bullish case. you don't think that the cpi nor ppi for that matter yesterday upsets it in any way. it just underscores the fact that inflation's coming down, but it's coming down slowly, and the bond market is still reflecting an environment in which, you know, higher for longer seems to be the play. >> well, you're right about all these concerns. i looked at the ppi and i particularly focused on personal

consumption, pen expenditures p. again, it does not include rent and it was up 2.7% on a year-over-year basis. back to the point about shelter, as you said, shelter reflects what happened yesterday. it's not reflecting what's happening today. there's, for example, a zillow index that shows that inflation is actually running in the rent category at 3.2%, and this is through september, whereas in the cpi, it's running at 7.4%, so the zillow index tends to be a leading indicator for the shelter, and i think we're going to see over the next several months that the rent component of the cpi comes down pretty dramatically and helps to bring the inflation closer to where it is without shelter, which is under 3%, and pretty close to 2%. >> okay. that's one part of the picture no doubt. >> sure. >> earnings season gets underway tomorrow morning, what are your expectations here? >> well, i think that we did see a bottom in earnings during the

second quarter. i think we're seeing a recovery in the third quarter. we had a very modest earnings recession, and it wasn't because of the economy going down. it wasn't because of revenues going down. revenues kept going up. what really came down was the profit margin because companies got squeezed, but somehow or other, companies are starting to figure out ways to make their profit margin go up. the analyst consensus expectations are showing that. so i think we're going to get a very good earnings season. i think that will help set us up for a year end rally, maybe a november, december santa claus rally year end rally. >> is tech going to be the thing that carries the market if there is, in fact, a rally? >> well, i think it's going to be a couple of things. i think we need to see the bond yield stabilized, and i think it's in the process of stabilizing right now. i think there was a lot of concern about oil prices and even with what's going on in the middle east, the price of oil is down from where it was in late september, the price of gasoline

actually took a dive so far in october, and that will be something that will impact the next cpi in october rather positively. i think the fed is -- at the end of october, early november when we hear their statement november 1st, i think it will be clear that they've come to the conclusion that the fed funds rate is restrictive enough in light of the backup in the bond yield, and the bond yield, if it stabilizes 4 1/2, 3 1/2 -- let's do that again f it stabilizes 4.5 to 5%, that's exactly the range it was in before the great financial crisis. the economy did fine back then and so did the stock market. >> i want to get back to tech, this story really is about tech in terms of getting us to where we've had good returns for the major averages. it's really been the whole story. can it still be the story? do you need more to come along? earnings are just all right, but tech is good, is that good

enough? >> well, i think the issue for tech has historically been their growth stocks and growth stocks don't do well when interest rates go up. however, one of the interesting things particularly about the mega cap, some people focus on the magnificent 7, whatever they are, the big tech companies, they really aren't that exposed to rising interest rates. they don't have as much debt as some of the other value stocks. i think tech could actually turn out to be the safe haven in an environment where interest rates are going to be higher for longer. >> all right, we'll leave it there. i appreciate it as always, ed yardeni, thank you very much. up next, we're tracking the biggest movers, pippa steven ss back with that. >> one dow component is seeing an injection of optimism. we've got the details coming up next.

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we're 20 away from the close. let's get back to pippa stevens for a look at the key stocks she's watching. >> fas nol is hitting its highest level since april of 2022. the company saw strong demand for its on site locations which offset softer end site demand for manufacturing customers. those shares up 7%. walgreen's is a bright spot on the dow as progress on its cost

cutting program outweighs a miss on earnings. it comes two days after the company named tim wentworth as its new ceo. those shares heading for the best week since november. back to you. last chance now to weigh in on our question of the day. we asked will the s&p 500 be higher or lower one month from today once earnings season is all but over, you can head to @cnbc closing bell on x, the results just after this break. what do you see on the horizon? uncertainty? or opportunity. whatever you see, at pgim we can help you rise to the challenges of today, when active investing and disciplined risk management are needed most. drawing on deep expertise across the world's public and private markets in pursuit of long-term returns... pgim. our investments shape tomorrow today.

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the results now of our question of the day, will the s&p 500 be higher or lower one month from today once earnings season is all but over. higher is the answer, near two-thirds. we'll talk to mike santoli about that coming up. also next, homebuilder stocks are sinking. we'll tell you what's behind that drop, what it could mean for the broader economy. i mentioned santoli. the market zone is coming up. he's in it. we're back next.

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stanley. we're now in the "closing bell" market zone, cnbc senior markets commentator, mike santoli here to break down the crucial moment of the trading day. ford's largest plant, the latest target of the uaw strike. that's why you see phil lebeau. we'll go to him in a moment. contessa brewer on the potential labor dispute hitting casino names as well. and diana olick on the selloff in homebuilders today. we begin with mike, treasury auction a little unsettling. kind of weak under the hood everywhere. >> yes, it was pretty weak pretty much all along. not in a dramatic way, definitely a little bit of wear and tear. look, four days of short covering, bargain hunting, a little bit of a chase going on. some relief out there that yields had calmed down, oil as well. and a little bit of a reversal here. here's how it goes, you think it's going to be a calm, nothing day. pretty poor 30-year treasury auction, sends yields shooting higher.

definitely back into the uncomfortable zone, that's when you can maybe relax if you're below that, shot above 470, still there right now. we're on guard, especially because the market, the s&p 500 has not proven it's more than a bounce yet. it's well on its way, but uyou haven't gotten above these levels from late september, that might tell you it's a little better than a reflex rebound. i guess it sort of explain, you know, the midday low. we were just about flat for the week. it seems kind of mechanical on one level, but very much taking its cues from our treasury yields going to get messy again to the upside or can we take some comfort that we've handled the move they've made. it's not about the fed. this gpi keeps the fed out of the game. it's all about the longer end. >> do you have a sense of 24 hours from now what we're going to be talking about, banks report obviously in the morning. it's going to sort of set the stages for earnings season. judging by the performance of the banks, it just hasn't been a great place to be. >> yeah. >> i don't imagine there's going

to be anything that looks really encouraging in terms of a turn around narrative, positive catalyst in the numbers themselves. it's really about relative to how these stocks have become priced, even jpmorgan, which now trades an absolutely tremendous premium to every other big bank on price-to-book and everything else, it's under ten times earnings. nobody's expecting this to be without its bumps along the way as credit concerns start to filter in. so i think expectations should be low enough, but you know, if you look at the financial sector etf, which is a lot better than the bank's etf, it's still, you know, still working underneath this short-term down trend line. i hate to get too much into the charts. that's what seems to be governing things right now. people getting very tactical. >> so phil, ford's largest plant in the cross hairs now of the uaw we hear. >> well, it's no longer producing trucks, that's for sure, scott. within the last two hours, we

heard from ford executives basically talking about where the company stands right now, and this is significant, as you take a look at shares of ford, the company's saying during this briefing with reporters and with analysts that it has hit its limit in terms of the economic proposal. we asked how much is that economic proposal in terms of billions of dollars, et cetera. they wouldn't go into that. they simply said we have hit our limit. this comes on the first full day of the kentucky truck plant being shut down by the uaw, 8,700 members walking off the job. let me put this into some perspective. this is the most profitable auto plant in north america. it is almost 20% of ford's u.s. production, the super duty is bit there. hugely profitable and popular pickup trucks, especially for contractors and for professionals who use it for more than just moving around. meanwhile, you've got gm and stellantis, according to the uaw

today, talks continue with those two automakers. scott, i'll send it back to you. >> appreciate it, phil. mike, you know, you look at the stocks, it's just been brutal. down 25% for gm in three months, and ford's down 21%, and by virtue of the news that phil was reporting, there doesn't seem to be any end to this in sight. >> before those declines, the stocks were valued as if, you know, the legacy business is in terminal decline, and maybe they're going to have to be able to perfectly orchestrate whatever transition they're going to make to evs. if you have higher labor costs, it's that much trickier. >> if you talk about low single-digits. four and five times earnings for these stocks. >> that's right. if you look at the overall capital structure they have all kinds of debt on top of that, a lot of longer term liability. not to say doom and gloom. it's much more about the market. to me it's more important for the economy than it is for these stocks. what does it mean in terms of general wage growth? is this going to be a little bit of a poisoned chalice if they

get the wage growth and the company is somewhat impaired or you're not able to be as flexible as you would have been down the road. what does it mean for overall labor costs and people, workers being able to capitalize on these gains that are being made by a lot of these unions. >> we've had these, you know, rolling labor disputes contessa brewer, and now we're talking about casinos. what do we know here? >> yeah, well, you were expecting thousands of workers in las vegas to go out and picket today. there's not been a strike yet, and i asked ceo of mgm bill hornbuckle at the global gaming expo, which i'm just back from in las vegas about this, he said we're going to get a deal done. we haven't had a strike here in, you know, 40 years. it's just got to happen, and they're expecting that to happen hopefully before f1. i think what you're seeing today, if you look at the broader group, see saer is down 6%. bally's off 8%. the concern here is not so much the stliekrike that affects thr

big companies in las vegas, but the cpi number coming in hotter than normal. remember, when you have people paying more for gas prices, conventional wisdom is that's less money than they have for discretionary spending like going to your regional casino and spending money. and who does that hit? that really hits caesar, bally's, penn, i mean, these are the big players in that regional market. i will point out that caesar's told analyst carlos cincsurgeon general -- week to date, this is down even further and i think that there's just real concern here over auto loan defaults and very low mortgage demand and how much money people have in their pockets across this nation, scott. >> appreciate it, contessa. and then diana olick, i just happened to pull up lennar. lennar's down 5%.

and that's only one of the homebuilder stocks today that are upset. >> it's all of them. this is all about interest rates, we got the freddie mac weekly numbers. even though that's an average of the past week, then the treasury yields moved higher this afternoon after the 30-year auction. so the 30-year fixed is now at 7.65%. that's down a little tiny bit from last week, but still up significantly in the past month, and so as you said, you see lennar, dr horton, basically all the builders all down on the day and on the month as well. i'll also add that the sellers, red fin, compass also down because the housing market is frozen before riwinter hits. the real estate agent said nothing is working the way it's supposed to and red fin this morning also put out a report saying its demand index is down, but supply is increasing at an unusual seasonal time, so you're getting more supply in october, just as we're going into kind of the dead season for housing,

which is december and january, scott. >> all right, diana, thank you. you know, mike, it's one of these days where it's sort of when in doubt buy tech. >> well, sure. >> if not for tech, this day would look a little messier nan it does because you've got nvidia is green, apple is green, amazon's green. you see broadcom today? up 3.5%. >> one of the top contributors to the s&p. >> some optimism about the vmware dealing getting done. it's helping the market pick look maybe a little bit better. >> quite a bit better. the equal weighted s&p is down a quarter percent. the question is whether you can bank on that relationship, just continuing to spiral higher, meaning the mega cap out performance over the average stock. you can right now above the former highs from 2020 and late 2021, in terms of nasdaq 100

relative to the average large cap stock. could we go higher? sure. at the beginning of the crash in 2000, we were like three or four times higher on a relative basis. so you can get wild, but i think it's a much healthier market if it backs and fells and you have some catchup by the cyclical areas of the market, the stuff that started to work, and it's happened both ways. it's not as if it has to necessarily break a certain direction. you're right, you know, the rotational action has insulated the index from worse wear and tear. it's kept what we've been going through since july into the routine zone, 8%, decline on cue during october, we start to get the bounce. we'll see if it can still continue to work together. >> still have a belief in many circles that as long as tech earnings hold up, and as long as those stocks hold up, you're good. you can get a late year burst. that's not going to please

everybody because of all the reasons you said. the rest of the market's weak. you play the score cards you have. >> that is true. if you're an index investor, if you're using that to benchmark what's going on in the market, and of course right now it's much more relevant than it ever was before because so many people do essentially just passively own the index. it is a measure of the amount of wealth that's being added or subtracted from the financial system, right? it's not just an abstract number on the screen. that said, i don't know that that is going to be a formula for the -- for things staying very happy. the math can work that way. it's still only 25% of the market cap of the s&p 500 in those stocks. >> so we'll finish red, we know that. we'll see what happens in the mortgage. i do want to mention before you hear the bell, that the members handicap children's fund is going to be on the podium today, they're having a big party here tonight. they do incredible work in the fund-raising that they do. so just keep that in your mind as you see them clapping and the bell's going to ring, and again, we're going to go out red, but

we'll see what tomorrow brings. i'll see you then. into ot with jon fortt. late rally, couldn't quite get there. that's the score card on wall street. welcome to "closing bell" overtime, i'm jon fortt. mo morgan brennan is off today. coming up this hour, former fed governor frederic mishkin breaks down today's consumer price index data and the renewed spike in treasury yields that sent stocks tumbling. bidenomics in focus as ceos from target, ibm and more gather at the white house for a meeting with the president. first, breaking news from boston fed president susan