billion shake-up will put a new focus on value over tech so here's an interesting one let's bring in chris harvey, head of equity strategy at wells fargo securities chris, appreciate you being here tell us about what you anticipate happening with this shake-up and what that means why it should matter to us >> maybe we will go back to what some of the guests were saying they are saying, hey, the reaction on tech was great, earnings out of tech was great but the stocks didn't do anything one of the reasons why the stocks may not be doing anything is they are no longer the momentum trade they are no longer the qu quote/unquote the chart looks good we are seen quanta move away, momentum players move away and this rebalance you will have tech go down from 40% much the index to about 17. and let's not forget the russell will rebalance in another month. tek -- [ inaudible ] placing it, you are seeing more cyclicals and value type stocks. financials were south of 2% in the index. they are going to go north of 30%. so now what momentum is or what i should say is financials are the new mo trend. >> do you

jonathan: he's chris harvey as wells fargo securities, the head of equity strategy. chris, i will try to keep this on the rails for you. [laughter] it gets harder as we keep going. chris: it does. we think we will have a pretty tight trading range, but we think rates are going to go higher. you mentioned real rates. we think real rates are close to negative one heard basis points. you have generational gdp, a lot of other things going on. essentially, they have to be forced higher. that is going to help the reflation trade. we will see a pretty big continuation of the rotation we have already seen. it hasn't ended, and it won't end for some time. jonathan: where are you on the s&p? chris: we are still lower. we have been conservative. you should see double-digit growth from financials, double-digit returns from financials and small caps, but we are expecting single digit returns from larger caps. we have been too conservative in that regard. the large caps have held up much better than what is expected. lisa: what is the big concern here, inflation? or some plea that

coming up, good friend of mine, chris harvey of wells fargo. we usually talk on "the open."hat's at 9:00 a.m. eastern. we will catch up with mike wilson as well. this is bloomberg. lisa: did you talk about e-commerce sales? [laughter] ritika: with the first word news, i'm ritika gupta. the biden adminstration has shifted its approach to the violence in gaza. president biden told prime minister budget not new -- told prime minister benjamin netanyahu he supports a cease-fire. since last week, benjamin not -- since last week, militants have fired rockets into israel, while israel has retaliated with air strikes and artillery. president biden has called for spending a little more than 2.2 trillion dollars. senator lindsey graham says a gop proposal should be as high as 900 dollars. republicans are opposed to using tax hikes to pay for spending. it would be amazon's biggest push into the entertainment so far. reportedly, the world's largest online retailer is in talks to buy mgm video. amazon could pay about $9 billion. mgm would help ulster amazon's prime streaming service. hom