of next week. shopping around will be less expensive week with the biggest savings on the year on the way. walmart holiday kickoff and amazon prime day are going head-to-head, mega retailers offering flash sales and major deals from technology to clothing to twice. walmart started the discount on monday. amazon launches a day after. we will follow it all on "mornings with maria" 6:00 a.m. to nine eastern every weekday. i hope you will join me and i'll see you sunday morning on 10:00 a.m. eastern for the fox news channel "sunday morning futures" program. i have exclusive interviews with house judiciary committee jim jordan, byron donalds and fbi agent stephen friend and nicole parker. join me sunday on fox news for "sunda i will do it on fox business, have a great rest of the weekend thank you for joining us, i will see you next time. >> "barron's roundtable" sponsored by global x etf's.

♪ >> welcome to "barron's roundtable" where we get behind the headlines and prepare you for the week ahead. i'm carleton english and for jack otter. employment data for september shows surprising strength in the economy. i'll ask henry mcveigh what it means for investors and what to do as bond yields climbed to the highest level since the financial crisis, obesity drugs and medicare price negotiations making big waves in the market. our expert panel dives into what stocks to cashing in healthcare. later small-cap stocks have been in the dumps for a decade why there is reason to believe a turnaround is at hand. we began as always with three things investors ought to think about right now. markets ending the week up after september jobs data blue past expectation despite interest-rate and dysfunction

washington food stocks are being slammed as obesity weighs on the market and that created a buying opportunity and travel trend taking a new turn as americans opt for simpler cobbler experiences rather than adventure vacations and good news for leader companies. on the "barron's roundtable" my colleague ben levisohn, andrew berry and elizabeth o'brien. this week in the market my stomach was up and down and usually tell me why this week was so tough. >> i was going to describe as head spinning rather than head turning, it's the same thing it look like the market was on the point of breaking down hard we had healed surging in the job report far stronger than anyone expected. the market was okay the biggest turnaround of the market since march to finish positive after being down 1% in the s&p 500, the question of the market having responded to

interest-rate, bond yields have gone up so much and fallen so much how much more can you fall look like it's ready to move on and care about something else. carleton: you say the market is ready to move on but we near looking at bond yields in the highest level of 16 years or so. are we really ready to move on are we paying attention there. >> i met paying attention to the equity risk premium how much yield your given for owning stocks over treasury read what is interesting it is about the same now as it was in july 31 when stocks were at their highs. that tells me the market has adjusted quickly over said real-time to what happened with yields. if yields can stay where they are the market has done what it needs to indicate move on to other issues. carleton: other issues what you looking at next week. >> earnings from companies like delta air lines in the big banks, j.p. morgan, citigroup and wells fargo.

attorneys have to do the heavy lifting. we had a number of quarters were earnings were negative and they turn positive year-over-year. i think the problem that raises the bar. the companies have to beat it if they can if not, we can see the pullback in the market continue. >> another thing that's going on a return of ipos one of our colleagues lights to write about the ugly shoe index. what we have coming down pike. >> we have birkenstocks which got a lift from barbie and other things. they are having their ipo the pricing fairly and adjusting. if this is well accepted by the market well received i think it's a good sign the trouble over the past month and half or two months will actually be passed this. carleton: andrew, big story of the year end tabloids, weight loss drugs like eli lilly and it seems like there affecting more of the healthcare that a been upset with the earlier. >> america has been coming a

ozempic nation in the beginning to embrace the diet drugs. they are focused on the downside of what companies could be losers from this. walmart said people who buy the drugs are consuming less food or buying less food so that was a broad selloff of food stock, salty snacks and junk food and soda and beer a big selloff on coke, pepsi, monda lees, anheuser-busch and many of the stocks within over 5% with 52 week lows. carleton: you bet against or room for upside. >> pepsico and coked down 5% this week. they're yielding about 3% plus, 20 times earnings in the business is durable. i would not bet against the american either. and you have 1 million or 2 million americans on the drugs right now even if it grows dramatically i don't think you have a big impact on the companies and their sales. carleton: don't bet against the american either, i love it.

elizabeth last year 2022 was a story of revenge travel. you find something else is playing on the market now. >> people are burned out and were seeing the rise of bliss travel. people want to stress free relaxing vacation in another trend is leisure which is business plus leisure if you have to travel and get on a plane for work you might as well tack on extra days to relax. marriott is getting in on this and talking about sleep tourism which is the thing and the importance of the gues sleep experience. cruise lines could be a beneficiary of the relaxing travel trend and have their eye on royal caribbean which is one of the topics. carleton: there's a unique play on european trouble, can you tell us. >> it is a hotel booking site with the largest market share in europe. carleton: i'm guessing the fragmentation of the european hotels are little bit different. >> unlike in america we have

large chains and easy to book directly, the market is more fragmented and more mom-and-pop so they have a corner on the market. carleton: thank you so much yields jump in stocks swing after september's job report but the resilient dichotomy is sparking concerns among investors all ask kkr cio ♪ today, my friend you did it, you did it, you did it... ♪ centrum silver is now clinically shown to support cognitive health in older adults. it's one more step towards taking charge of your health. so every day, you can say, ♪ youuu did it! ♪

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carleton: markets rebounded after fresh report on hiring reveals a much longer labor market than economists expected but treasury yields at the highest level since 2007. how will the feds react and what should investors be responding. joining me cio henry mcvey. thank you for joining us.

>> let's dissect the jobs report the blue paschal expectation, what do you make of it. >> one is a services economy that is roaring hot and you see the and professional services, healthcare and leisure and hospitality those jobs are below pre-covid levels and the good news why you have a positive market reaction was a wage growth a little more subdued so the fed is not would be done until they temper the wage growth as well as the overall labor force that's where were going to go i think the upward bias is towards higher yields and will have until labor starts to settle down which we think happens in 2024. carleton: i'm glad you talked about the higher yields that was the story of the week or the year with yields approaching 2007 levels. just curious how much is the effect of the fed and the chaos

that we've been seated washington the risk of a credit downgrade. what are the dynamics of seeing in yields. >> the first thing of your viewers not paid attention is international holders of bonds, japan and china have been selling bonds that the technical with more supply and second a lot of chaos in d.c. fundamentally we are running with the highest deficit outside of war since before world war ii of the market is reacting to that to strong fundamentals in the form of growth but you also have less than spectacular technicals giving the supply coming on the bigger deficits as well of international holders owning less treasury, i don't think that goes away. getting back to the fundamentals that need to improve for the bond market and unfortunately that means lower wage gains and slower overall growth. there is a balance the fed is trying to strike i think we will get there but it will take more

time. >> there is something that you said that ties to this which is regime change played on the economy and markets can you spell that out for us. >> our view at kkr what we've been highlighting that were moving from low growth low information to a higher growth higher gdp with a little more inflation in the system driven by four factors, one that we saw labor and wages are still growing, to his bigger fiscal the republicans and democrats are still spending three the energy transition is bumpy and leads to inflation, the final one geopolitics as i travel around the world supply chain is starting to move to vietnam in the u.s. and mexico that is leading to less efficiency, those four drivers are the key things that lead to regime and investors need to think about how much they own in stocks and bonds and were particularly concerned we try to create products for investors to help them get the yield without the duration of volatility

associated with traditional fixed income. carleton: is there a proportion of holdings that make sense on the bond like investment. >> most people 60 - 40 that's what you hear quoted we would have a much lower percentage on the bond side there are other things you can do around owning things in the link to the growth in the economy that have yield and cash flow and housing in asset-based, general infrastructure it does really well in a stronger economic growth where we have pricing power and able to pass those along i think for individual investors and institutional investors you have to think differently about the regime change thesis. carleton: what are the other things that we are seeing is energy you recently said $80 is the new $60 how scared should i be in what's opportunity. >> you follow where stuff what we've been saying people are going to be too bearish that is faster and more.

what you see energy transition nad carbonized world, what happens company still invested much in the existing energy that is created supply and demand and what it means you have a higher resting heart rate for energy and that's our inflation cost. i think that is a reality in oil went up to 100 into new 80 but we do settle down a higher level and that is something that we need to think about as we fill up our cars or think about our houses or economic budget. is a new reality. thank you you taking us around the world i know you had trouble in china and japan. understand you seen opportunities. you so much for your time. >> you. health stocks are slumping as weight loss drugs shape. to

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i move so much better because of cosentyx. ask your rheumatologist about cosentyx. carleton: times have been great if you own stocks to obesity drug but every other health stock has been in the dumps what are the chances of a turnaround and where can you find healthcare in the vesting period. assembled stocks healthcare reporter for barron's was there any joint just to tell us what he learned. josh, can we expect a turnaround and the health stocks. >> if you think through the subsectors, there is a reason why they are down to multi-year slump over the past five years it is 20% this is a structural problem, with pharma putting aside the obesity drugs the patent cliffs, earning stagnation, the dividends are

not enough to be attractive anymore, med tech medical devices done by the obesity drug and that if you added anxiety and antitrust regulation and worry about the medicare price negotiation is pretty easy to see why the stocks are down and i'm not sure there is a real way to put on a date. >> you talk about the stocks that have been down but when you look at lily and companies behind blockbuster drugs as ozempic, they call this the a.i. sector of healthcare, are the stocks looking overvalued? when you look at market values as high as they've gone, you get a little nervous there's not a member of our panel you is a jenison and she argued utilization is still lower we need early innings of the obesity drug phenomenon and as utilization goes up earnings are going to grow and she sees a lot of upside left, bank of america

analyst on friday raise their target price now is around 550 a share and going to 700's share. >> what do you think about the impact on the industry from medicare price negotiations. >> this is a big topic. the pharma companies put this in exponential terms. there was a pretty, this could impact virtually all of the big drug makers in the next few years drug makers including pfizer, bristol-myers, johnson & johnson they all have drugs in a be in the first round of negotiations, there was a legal setback for the drug companies last week in general is looking less and less likely that they will be able to get a legal injunction to stop a bone tatian of the law. i think investors expected units priced in in the industry doesn't think the companies are doing it to get out of it before it's implemented. >> my view a positive surprise for the

government that is dictating price rather than the negotiation in the supreme court that may see it their way. >> that would not happen until 2026. prices already. >> what about mna outlook big pharma has 200 billion going off patent and that would be fuel for dealmaking. >> there's a lot of anxiety about the ftc on former mergers the anticompetitive and taking a close look at a lot of big deals. on the other hand amgen 28 billion-dollar of horizon was allowed to go through an industry is enthusiastic or optimistic that $40 billion acquisition will go through. investors don't seem to be particularly up on either of the megadeal's, companies like lily are pursuing more smaller bolts on deals seem to be getting a get more traction. >> josh, i have to ask you have any stocks that come up that look attractive.

>> funny you should ask. it was interesting to the members to your price and the different jenison vertex is a nonpersistent fibrosis which had an impact on the disease, their working on a non- opioid payment and would have the risks around addiction to opioid drugs do. it's an earlier stage of trials but the opportunity is potentially enormous there should be new data in the next few months so i will keep a close watch on that. >> what about other companies. >> we also mentioned regeneron. i gotta get my list a lot of stocks came up. astrazeneca was another name it has one of the best growth profiles in pharma after eli lilly that much cheaper. and jared made an interesting view mckesson one of the big job

to drug distributors. if you look at the channels and that it distributes to their one that he expects the weight loss drugs might have the biggest market. he thinks it's an interesting sideways play. >> just curious we are looking at the postcode world right now. how much do covid vaccines factor into the healthcare stocks. >> the big debate for the covid drugmakers talking about moderna, biontech, pfizer is how big the covid vaccine market is going to be this year, the companies took down the estimates from 100 million early this year end other expecting 5e drugs have been approved for about a month. it is early to say how it is trending. investors are pretty negative like moderna and pfizer performed well this year end are waiting to see how the roulette goes will know more in october. carleton: a lot of good stuff. you guys have a pair of

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carleton: andrew for the longest time small caps were not the place to be but apparently you're seeing something different. >> they had a tough five years or ten years, small caps are flat and s&p is up about 14% but it may finally be time to consider small-cap for evaluations about 12 times forward earnings in 18 for the s&p 500. if the economy proves to be resilient small stock in trade stocks could do well and you can see below are under more buy-in as they attract private equity of other buyers.

carleton: as a sometimes deal reporter i love to hear that. give us some names. >> birkenstock is going public and the value version of doc martens is a london-based company with the clunky boots, durable business model trades for a fraction of what the birkenstocks do. also nordstrom obviously the luxury department store chain trading at six or seven times earnings and has attractive online businesses as well, we could talk about global business travel group is a leading travel agency right now and inexpensive play on the revival of business travel. carleton: you talk about retail. elizabeth you have a different take on retail, what is going on. >> federal student loan payments resume after a pause of more than three years the average student loan payment is 300 month give or take multiplied by

40 million borrowers that is a lot of money consumers will not spend in stores. carleton: it probably doesn't bode too well for retailers. give us a stock pick. >> i'm looking a alphabet this is a bad month, last month s&p down 3%. alphabet is up 1%. the strength tells you there's something going right, earnings don't come out until october and i would watch their cloud business to save his getting an a.i. boost. great ideas, thank you. to read more check out this edition of barron's.com. don't forget to follow us on x, formerly known as twitter. that is all for scu next become "barron's roundtable". >> from the fox studio in new york city, thi