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tv   Power Lunch  CNBC  October 13, 2021 2:00pm-3:00pm EDT

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could get at it that would seem less invasive? >> they say it is not invasive toll just have the total at the end of the year. again, they are not looking at individual transactions. they just want to know at the end of the year, what did you take in, what did you get out? with those two numbers it is not that hard to report them and you can tell a lot whether they have accurately reported their incoming and outgoing. >> very interesting, very epful as well, robert frank. that does it for "the exchange." we are just getting started. "power lunch" begins right now welcome to "power lunch," i'm flank holland in for tyler mathisen here's what's ahead. the minutes of the last fed minute are out any second now. it could include key insights into what policy makers are thinking about inflation and the taper time line. also breaking the bottleneck the white house attempts to ease the backlog at the ports are transportation companies
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already maxed out? a top analyst weighs in. buy this, sell that. our monthly report of flames to own and the names to ditch in two sectors. >> frank, welcome. thank you. >> ahead of the fed minutes let's get a check on markets dow is down 15 s&p up 11, nasdaq 92 at session lows the dow was down 250 points the ten-year hovered around 176 early in the week, yesterday morning. and now at 1755. steve liesman has the key headlines for us he's digging through them right now. bob pisani at the nyse ethan harris and mike santoli join us. ethan, what's the base case for fed tightening at this point >> we don't think they are actually going to get going until 2023 in terms of rate hikes. we will probably here a about tapering. >> when you say on the verge of tapering, you expect a november
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announcement and maybe a december start date? >> that's about right. we think we will also have a fairly short time frame for ending the tapering. probably next summer. >> let me turn to bob pisani with a look at what the market is expecting for the fed here in light of all the supply chain issues we are facing >> this is a delicate moment for stock investors. steve was talking about the possibility of the fed moving up the time line for hiking up interest rates, maybe up to september of 2022. this makes stocks investors nervous because historically, one of the rules of bull markets has been a fed policy mistake, the market means sudden unexpected moves up in interest rates by the federal reserve that's a worry the problem is, the fed might have to react to another killer of bull markets, sut spikes in inflation. this hasn't been a problem for a long time. it was a huge problem in the '70s even in mid 2005, '06, 'when we
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had the commodity boom, oil prices doubled suddenly. that's why the market is worried about this move up in oil. if it goes from 80 to $100 that's not good for stock investors. they will worry the fed will move up its time line in the commodity climate, particularly oil. it is a nervous time for stock investors. >> officials stress they don't believe there is any link between tapering and interest rates going higher interest rates have gone considerably higher getting closer to november do you think of them as lirched? how do you see them reacting >> the fed has taken pains to separate tapering, they want to get out of the mode of buying $120 billion in bonds every month and separate that from when the fed itself raises short-term rates i think they have mostly succeeded in doing that.
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i find it fascinating the conversation is not about the tapering process is about to end. on that front, the fed has been successful but, yeah, i mean market based yields, longer term yields have become a little bit unstuck. but i have to say they have not necessarily gone to the levels where you would feel as if they were a threat to growth. by the way we are also going to be kind of an verse earring the hot inflation numbers of this spring in six months before most likely the taper is over so it could change the whole discussion about whether or not weather in fact there is urgency. because inflation is measured this year over last year next year we are going to be going over a year that was pretty high. >> all three averages are at session highs erasing the declines we say at the beginning of the morning the dow, the s&p and the nasdaq across the board are in positive the dow up 14 points
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we are seeing headlines rolling out. steve liesman has the details for us. >> thanks very much. just a very quick read of these minutes here we have more to do but they did discuss the timing of the taper the committee concluded that a gradual tapering process was likely appropriate participants generally agreed on a taper concluding around the middle of next year. that would put you in about the $15 billion a month reduction each month in the amount of asset purchases. they said if a decision was made in november the tapering could begin, this is sort of new, mid november, at an earlier time or mid december, which is when more people expected it most participants saw that substantial further progress criteria they had set out for both employment and inflation had been met allowing for the tapering to proceed. the increasing funds rate would depend on the path towards the fed's goals.
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and no signal about rate hike. that was just about reading the tapering portion heck, if i do that in three minutes, imagine what i can do in two minutes >> ethan, do you want to react to this? >> i think it is what we expected start in december, finish by the middle of next year. the fed has been telegraphing this this is not a shock. i think the market is correctly focused on rate hikes. that's where the real danger is, not this slow-motion exit from bond buying. nothing really new here, i think. >> we are seeing movements in the markets. the dow turning slightly negative almost flat right now. back to you, mike. in general we are seeing talk about inflation. steve is going to hit on that i am sure more when he comes back to us. do you see the fed continuing to target inflation or do you think they are going to see it as transitory going forward in
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these minutes? >> i think, it seems as if the fed would like to extent the period over which you can give the benefit of the doubt to the transitory camp. clearly they are having to acknowledge it has been stickier than previously anticipated. interestingly, today's consumer price index number didn't have enough in there. it was close enough to forecasts to prevent the market from having a relief rally off of it. but also was not incrementally scary. you look at the core components, we knew rents were going to go up and things like that. it remains a two-sided argument but again i wonder what happens into next year when we are going up against some of the pandemic dynamics presumably, you unkink the supply chains to some degree and the inflation numbers maybe don't look as scary, preverving a little bit of flexibility for the fed. that's the presumption. >> bob what do you make of the market's reaction? >> they are moving up. they are reassured this has been very good communication with powell and
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the rest of the fomc saying there is no relationship between tapering and rate hikes. don't be concerned about the taper talk, the rate hikes are still way down the road. that's the good news the bad news is i can tell you what they are talking about down here they are not worried about the taper at all that's the good news the fed has very effectively pushed that out of their minds they are concerned about longer term inflation nobody believes that wage hikes that we have been seeing are transitory nobody they are going to be very sticky however, it's another business at all, completely, when you are talking about commodity inflation. i hate to go back to oil again but if oil goes to $100 that's going to be a major problem. that's going to catch the fed's attention and will move up the time line for rate hikes that's why it is hard to get a handle around this we don't know where some of this non-wage-related inflation is going right now. >> bob, a bit of a cycle we are seeing wages going higher and also consumer prices go
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higher 4% higher even if you exclude food and energy. a wheel here of things stacking on each other. we gave him about three minutes. that's what he asked for, kelly. steve liesman with much more on the fed minutes. >> not much more, frank. don't oversell it. i just want to talk about the inflation part of it many of the participants saw inflation risk to the upside on the issue of rate hikes, a number of participants raised the possibility -- raised it, didn't decide on the possibility of beginning to increase the target range by the end of next year because they expected the labor market and the labor outcomes specified intheir guidance to be met by them and saw thought it might be elevated in 2022 with risks to the upside i want to look live at the federate hike probabilities. they look fairly unchanged at the higher level we have been reporting. i am seeing an 84% chance for december of 2022, that is.
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60, 69, call it, for november. and 62 for september as we have been reporting, guys, what happened here is the possibility of that first hike, the probability of that first hike has moved from september to december it has been brought forward as more officials talk about the idea of getting it done. the quicker the fed is done with the taper the quicker the possibility to hike the rates if inflation doesn't come down on its own. >> the dow actually going back fractionally into positive territory. thank you steve liesman. bob pisani, mike santoli, ian harris, all great stuff. the white house has a plan but one indicator says it will be harder than ever for transportation companies to add capacity a. look at what it could mean for key stocks. plus, retail names that can weather this holiday supply
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crunch our trading nation is on the case. as we head to break, some of the stocks hitting a 52-week highs in today's session xilinx, oracle, and ceridian much more "power lunch" coming up
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biden administration's strategy. >> kelly, ahead of that meeting president biden and the white house announcing a deal to move the port of los angeles to 24/7 around the clock service as part of a deal with the international long shoremen and warehouse unions and they also announced that six companies, fedex, ups, target, samsung, walmart, and home depot are increasing their overnight services for the next 90 days to move more cargo and help expand transportation of goods from these ports to their end test tin dags we expect president biden to make those remarks momentarily today he is also meeting with executives from port companies, logistics companies, and many of those retailers as well. the white house says these change also move an additional 3500 containers per week between now and the ends of the year though they hope this becomes the new normal, this 24/7 operation. a senior administration official has also called on freight rail and trucking companies to incentivize workers to increase
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their capacity so far there is no official expansion on that front. the administration says it is focused on incentives, not penalties for now, but it's unclear how long that can last the administration is acutely focused on alleviating the supply chain log jams by the end of this year, specifically by the holiday season so that american shoppers can get their purchases on time and at reasonable prices without those prices rising very sharply they have someone at the national economic council who is leading that effort and senior administration officials tell me that they are hoping and so far they believe that the data will bear out that this inflation starts to ease at the beginning of 2022. kelly and frank, a lot has to happen before then >> kalee tausche reporting from the white house. as she reported the u.s. is very focused on alleviating the nation's supply chain crunch by focusing on the port of los angeles complex, 36% of all containers imported into the u.s. come through this freight
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gateway. top items, electronics, clothing and furniture. and year to date, those imports, they are 30% higher, really stretching the capabilities of the port to get those containers moving all around the country on trains and on trucks and the companies at the meeting, walmart, the largest retail early in the nation target, home depot, and samsung. they bring in just about 10% of all containers into the u.s. every year for more on that, let's bring in the managing partner of broughten capital. donald, thanks for being here to break it all down. >> great to be here. >> we were talking about it. kayla hit on it as well, consumer prices. they have increased 4% over the last year even if you exclude energy and food. the bides getting a lo-- the bin administration getting a lot of thaungs for this call to move goods at l.a will it alleviate prices will it make holiday packages get to my house on time. >> the short answer is yes it will 4% over last year. remember, prices were down last
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year fifth grade math if it is down 50% last year, it has to be 100% this year managing transportation has become a profession. it has more talented people, more brain power, as well as more of those people committed to it. and they have better tools than ever before. as you just noted, almost 40% increase in the amount of containers they are moving already through that port. the reason we are cry being this is economic demand is so strong. it is called growing pains these will get solved. >> done, it'scaly here we had an interesting discussion about signet jewelers who has been avoiding these problems because it has been using airf airfreight. >> yes. >> do you think it is something
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other suppliers should do, or is it just easier to transport jewelry on planes than other goods. >> that's a good question. if it is dog food or coal, you don't move that via airfreight high value, low density type goods, absolutely a. lot of the stuff that goes this the stocking stuffer is going to be moved via airfreight and the fedexs and ups of the world are going to benefit on that. >> not everybody is crying trucks and trains, they have more pricing power than they have ever had historically, more volume than they have had historically we saw big name companies a the meeting at the white house walmart, target, samsung if they increase operations how do they offset the increased
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costs for those operations how does it work for their top and bottom lines >> first of all, the higher the value, the lower the density the product is, the less the component cost of transportation is, and the less delivered the cost of goods delivered is the cost of the transportation versus an iphone it's a smidge of the overall cost to get it delivered so you can double that one-tenth of one percent and you still haven't done anything toll pay for it the companies producing great fast expedited services can pay their workers more, produce that velocity, ask for pay increases from the customers and everybody is still fat and happy at the bottom margin line and those companies that are all there, let's just fess up. what the biden administration has done is bring in national attention, bring a profession that was ready to be on the national stage, introduce them, and put them there
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that was going to happen anyway. that was going to happen because walmart is a leader, not only a retail leader. they are a logistics story fedex and ups are global leaders in fast chain, fast cycle logistics. they were going to do what they were going to do anyway because the shareholders require it not because the biden administration asked them to do it. so -- >> donald, what can the biden administration achieve here as we know that -- what's going to happen this christmas season with what to frank's point was this the cards months ago. a lot of these are long lead purchases. they are trying to expand operating hours at the ports now to basically 24/7. what else can be done? >> i am not besmirching that they are doing calling attention to sit a good public function. marketplaces were already doing it buyers and retailers made their purchases and made their bets on
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how many particularle me elmo dolls were going to be sold this christmas. that's why we are a backlog. they predicted we are going to have a blowout in retail sales numbers in the coming months bringing to it the public's attention and making it something that everybody is focused on and hence willing to pay a little bit more for helps the profession pay to get it solved, pay to get it fixed. a year from now, this will not be an issue. >> a glass half full outlook one more question before we let you go wouldn't this effort at the port of l.a., increasing output at the port of l.a. going to do for shipping costers for all the other transportation companies you said everybody is going to be fat and happy but it is hard to believe the retailer will be fat and happy when it is going cost more to truck or transport their goods by ray. >> you might be fine when the auditor closes the books at the ends of the year
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that said, what happens here is remember a lot of these are fixed costs, big fixed costs in running a port or a trucking company, shipping company, a railroad if you accelerate velocity, you move more product through it, you can actually come out much better even though you are facing some of the challenges you are with paying additional workers and dealing with some of the congestion issues that you currently are. >> great insights as always. donald broughten we appreciate it. >> thank you. coming up, we are awaiting president biden's comments on the supply chain worries we will bring them to you as soon as they begin we are back in moment with a ollomo "weluh.whe t repor nc stay right there
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vaccinated and travelers will be able to cross the boarders mexico is looking to restart economic activity in the area on its side of the border by getting people there vaccinated. boeing joining the list of federal contractors announcing quid vaccine requirement its 125,000 employees have until early december to present proof although they can ask for a religious exemption. in virginia, the democratic candidate for governor terry mc mccollough cast his ballot let's get a check on the
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markets. dow up 10 points s&p up 13. nasdaq up two thirds of 1% let's look at what sells moving? we are going to -- we are tracking the selloff in casual signing stocks after morgds cut price targets for several names in the group including brinker, texas road house, blooming brands a sea of red. cheese cake down 2.5%. analysts are expecting margin pressures related to labor and commodity challenges saying casual diners could struggle through the ends of the year but attract more interest going into 2022 a similar story with domino's. morgan stanley cutting the targets from 559 from 564 but maintaining an overweight rating we will get quarterly results from domino's before the bell tomorrow morning frank back to you. ahead on "power lunch" we are still waiting on comments from president biden
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welcome back to "power lunch. the oil market closing for the day. let's go to pippa stevens at the cbs commodity desk. >> oil moving between gains and losses before ending the day here little changed. on one side, there are surging power prices on the other, fears that inflation and supply chain bottleneck also hurt demand. wti is down a fifth of the one%. brent crude at a loss of a quarter of 1%. opec trimming its oil demand growth forecasts boor 2021 but not by a lot
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they see growth at 5.8 million barrels per day down from 5.9 and say that fossil fuel demand could peak by the middle this decade although there is a lot of uncertainty about that. >> a lot of headlines there, pippa thank you. time now for a segment we call buy this, sell that our next guest is looking for a stock to buy and sell this the communications sector. serat seppi, it's great to have you. let's drive right in we will start with buy comcast more, interestingly -- which is our parent company -- there is a huge a. consternation between the broadband and the telecom space. tell us what you think that's about and why you think comcast is a buy >> good question, kelly. a few weeks ago when i was done it was one of my buy stocks and it was trading close to 60
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you had two multiples turn down. it is trading at 1 times earnings what happened is the sell side as talked about, the competition coming from the telecoms how that's going to bring down margin asks disrupt the growth rate we don't think that's really going to happen. the telecos have enough going on we will talk about that on the sell that side comcast is a leader in its space look at the margins just on broadband. then you have nbc universal, the international assets in the uk, peacock, that is basically valued at zero then if you look at the catalyst for november, when we are actually going to let people from europe fly in and the borders are starting to open at 14 times earnings, brian roberts at the helm, you have got a great balance sheet, 2% dividend yield the downside here is much less than the upside. the upside for us when we see this stock is much greater. >> do you want to quantify that or >> i mean, for me, i mean, you get a normal -- okay
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so the s&p trades at 20 times this should trade at a higher multiple because the growth rate is higher than the s&p i could see 50% higher here. i don't know if it gets there in the next two or three quarters we invest for two to three years. but this is a very solid company. they can buy back shares they can take moore debt on. the balance sheet is a strong place. fund lee this is one of our strongest investments. >> on the flip side, at&t. we watch the stock, see it at 11 year lows and wonder if a lot of the bad news is already priced in why do you think it is a sell? >> we owned it in the past once they announced the warner discovery deal really what you are left with is a teleco company that has to spend a lot of money on the 5g rollout then it has a blaelt that's highly indebted and they are going to cut their definite depends. what happens when you cut your dividend you get a shifting of
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our investor base as well. a lower dividend, lower growth rate, much higher competition in the teleco space with 5g bigger spends. really, we are looking at kind of a depleting asset in our world and really not a company i think is going to be growing in terms of multiples or earnings. >> serat, frank holland here turning to industrials you have a name that's in the news today. fedex, one of the companies there at the white house meet being the port of l.a. you have it as a sell. another company called transdon as a buy start with fedex why a sell >> if you look at fedex one of the things that's happening is we like companies that can raise prices faster than costs go up cost inflation is so high as far as wagers right now they can't pass those on to their end consumers. the other thing is fedex is having a hard time with logistics. they can't have enough people of
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at their facilities. oil prices also going up they can't pass that through you have a few things going on on a company that's extremely highly capital intensive, cans pass its pricing on and also in terms of costs just going up. >> with that said, fedex shares are up over 1% right now now over to one you want to buy, transdon i am not that familiar with that. >> transdon is the leader in aftermarket aircraft parts so why do we like this story in the you look at where we are in the covid story, the deatha story, we are at the tail end. what happens when we get more flights out. we will have more flights in november, december, delta talked about it this morning. aircrafts need a lot of maintenance. transdon provides these maintenance and get certified for these products margins are at 45% as you see kinds of traffic growing and aircrafts coming back on they are going to need more maintenance
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to get certified, as i have mentioned it is a huge ordeal. and this is the speed for transdon their business is going to increase, not just incrementally but rapidly over the next two or three years. we think this is going to be a cash flow machine. they expect to grow their ebid de by 15 to 20% for the next three to five years. it's stock that not many people talk about it has gone a bit under the radar. hasn't performed well in the last year. if you want to play reopening and you want to play the whole transport space,s that perfect place for a company that is high cash flow and is a company that's going to be tough to beat. >> is there a price level that would get you more interested in fedex. when might you decide that the worst was priced in? >> so, i think the worst, kelly, things to watch is oil if oil goes close to $100,
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that's -- short-term is going to be hit i would say probably close the around christmastime when things are the worst and they can keep up you want to buy a stock like fedex, in fact any stock when things are ugly. because where is it going to go from there i think you are still in the fifth or sixth inning. i think there are other companies in logistics that you could invest in. it is too early for me to get involved in there. i think you have to see more blood in the street on that stock before you get in. >> it is kind of a bellwether of everything that's going on right now. serat, we thank you so much for running through all of those picks today. we appreciate it >> thank you for having me. we have been talking a lot about the semi shortage. we are getting more evidence of it volkswagen saying just now that its tennessee plant will adjust shifts the week the 18th and 25th due to the chip shortage as hyundai is saying maybe the worst has passed
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coming up, the red hot housing market could have more room to climb. goldman sachs says prices could rise another 16% by the ends of next year but our next guess says the market is cooling down. and we will speak with the red fin ceo about how they are making viewings even easier. that's next on "power lunch.
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welcome back if you are in the market toer a new home there is a new way to look at properties in person without a real estate agent. red fin is teaming up with adt to allow possible buyers to self tour homes in select markets this comes as red fin sees signs of a slight cooling in the housing market joining me now, the ceo of red fin. glen, thanks for being here. >> thanks for having me. >> you are having your best day since july bringing this up, your shares have fallen 20% year to date as the housing market has become more and more expensive. imgoing to go to diana olick's reporting. new home sales down 20% since 2020 prices up 15%. who is this service for? first-time home buyers have been
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priced out who wants to buy a house without a real estate agent. what demographic appreciates that >> it cuts across all the demog demographics it doesn't mean that you have to do it without a real estate agent. it might be that you are driving buy a house and you want to demo the house with your iphone people love to tour the home by themselves but use an agent to buy the house. this makes it easier to see a home's red fin list as opposed the other listings 70% of the offerings we get on properties come from people who toured the property on their own. just because you want to see it by yourself doesn't mean you want to buy it by yourself all the way through. it is a new level of screens. >> 63% of home buyers bought a house sight unseen, without seeing it in person, in 2020 maybe they saw pictures on the internet are you seeing more demand for
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these in-person visits, whether it is with an agent or without talk about some of the tech tools you are using to keep the as a safe house visit on your own with your cell phone i think you are doing geofencing you are monitoring people while they are in the house? >> that's right. our iphone application is monitoring whether people are hiding under the bed, whether they have actually left the property we don't want anyone hurt. we could have rolled this out three or four years ago. technology has a history of unintended consequences. we try to live up to our responsibility to keep everyone safe and still provide a new incredible level of convenience. the challenge is to make it easier for everyone to see a home and still giving the homeowner assurance that it will be safe when they come back for their kids to go downstairs and watch tv and for them to make dinner without worrying that some creep is hiding in the attic.
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adt is handling the security side of it to make sure nobody is having a party in the house, that there sit someone still in the house. it is all about tracking the person who walks into the property and making sure they walk out. >> at first i thought this was looking inside the house in a virtual reality or using cameras. now you are saying literally you are letting people into houses that are for sale. adt basically unlocks the door for them got night right. the red fin -- -- go ahead. >> we are all used to going and looking at a property and it has a special lock on the door how does that technology work? >> well, the red fin mobile application on android or iphone has a button where you push it in the app, and then the door unlocks. it feels incredible when it does you are like, oh, man, open sesame you walk into the house, you walk around. then we prompt to you lets know when you are done with the tour. and then we make sure that that phone is far away from the house before we tell anyone else to
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come back in we have other measures that we are less transparent about because crooks might be watching your show. and we want to be careful not to tip them off on how we keep the home safe. >> i will ask you about the housing market overall, glen you hinted about signs of a slowdown maybe what are you seeing? >> i have to be careful here we are announcing earnings in just a few weeks don't get me into any trouble but i think there is a long term trend that housing is reverting back to its normal state with seasonal increases and decreases in demand. as we go into the fall demand is going to come down also is nothing to worry about except a shortage of inventory there are still a shortage of homes for sale in america. it is a bit of a landlord nation because rates have been so low that people don't want to sell their house. instead they want to rent it out. there are not enough homes to buy. people are moving out of the
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coastal cities into the interior to look for afordable. even there price versus gone up so much it is putting a pinch on the american home buyer. >> such a great point about how -- still looking for inventory. i know people firsthand who are holding on to their houses and not selling them just in case they want to move back in a couple of years. glen, thank you. >> thanks for having me. we are waiting on president biden to speak on the supply chain. when he does, we will bring it to you >> we are also talking about how supply chain struggles can influence the market can any companies weather the storm? trading nation is next. all month long we are honoring hispanic tear taj month. here is martin cabrera. >> growing up in a latino community on chicago's southwest side i learned value lessons, a strong work ethic, family
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values, perseverance, and grit, and a competitive spirit that still drives me today to win in business advice i would give ceos is that latino youth withes one of the fastest growing demographics in this country it is an economic tsunami beginning. i hope you are ready for it.
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welcome back to "power lunch. i'm seema mody two outdoor and sporting good stocks could weather the supply chain storm better than their peers according to bank of america. the firm naming yeti holdings and dick's sporting goods their top-paying pick. are these really the top games in town or are there other retail names worth watching? nancy, as you look across the retail landscape, what do you think? names that can perhaps survive the supply chain shock that's about to hit, or is less reliant on the gflow of goods from vietnam and other countries? >> the stock is just a little bit expensive for our tastes
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i would take a look at costco. this is a company that is well positioned to handle supply chain disruptions. the purchasing team is probably one of the best in the industry. and management came out on the last call and said, listen, our warehouse format allows us to stockpile inventory and buy when inventory's available. so i think that will mitigate some of the supply chain disruption that some other stores will see. and then as a beneficiary of outdoor, they will be also in addition to holiday shopping, toys, jewelry, i think this is a company that's well positioned they also said on the last call that they sold a couple of diamond rings in excess of $100,000 so check out the jewelry section when you're there. >> wow, there you go i know, jeff, you have your eye on nike. the stock is up nearly 8% just this month what do you do with it here? >> i think over the summer it had a lot of sensitivity to the supply chain issues.
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and certainly a 15% pullback it touched 175 now it's pulled back at 145. so i think you want to own it. the reason that is number one in space. we talk about dick's we also talk about yeti. and sometimes my boys and i, we go to dick's to buy yeti products you have to really understand that dick's and yeti, those are 10 billion market caps and less. we start talking about costco at 200 billion. nike at 250 billion. these are much bigger market capitalization i think nike right now at this technical level and also the sentiment going into the year, it has a laggard i think it provides an opportunity for a little bit of outperformance, seema. >> shares of nike nearly up 2% today. great to see you both. you can catch us on twitter or online president biden's going to speak on the supply chain bottleneck when he begins we're going to bring it to you right here keep it on "power lunch.
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it's me, frank, not you. [ laughter ] >> i've heard this before. >> the same holds true for the connection between stocks and bonds. kristina partsinevelos is here to explain >> yes, it is complicated. frank, united -- although it's still lower than the 1.75 peak in march, the 10-year yield is rising economist david rose enburg said it's entirely almost due to the expectations regarding fed policy the nasdaq 100 is comprised of large-cap tech firms and has dropped over 4% just in the past month, 5% now. high valuations because it means earnings years from now are worth a lot less but utilities is the sector facing the biggest drop. year-to-date returns are just hovering around 3% versus the s&p 17% return and we can show you the
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divergence right now between the utilities xlu etf. even if you talk about the near term, definitely separating right there. and utilities like pinnal west and atmos, those are some of the worst performers year-to-date. but rising yields is not the end all. in a bank of america note, analysts argue increasing treasury yields are not bearish for u.s. equity, citing data back to 2005 that shows the s&p 500 is stronger on days the u.s. 10-year yield rises. since 2010, though, the s&p 500 financial sector has had a 66% correlation with the 10-year treasury yield the highest correlation out of all sectors. it seems like that relationship has hit a different level. take a look at the financial sector etf xlf, and the kbe. you can see it's trending
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higher >> thank you very much let's get over to president biden speaking on supply chain issues >> and how hard it is to get a range of things from a toaster to sneakers to bicycles to bedroom furniture. and that's why back in february i signed a piece of legislation on supply chain, executive order on supply chains and that we had to move on it. with the holidays coming up, you might be wondering if the gifts you plan to buy will arrive on time supply chains essentially mean how we make things and how the material and parts get delivered to factories, a factory, so we can manufacture things, and manufacture them here. how we move things, how a finished product moves from a factory to a store to your home. today we have an important announcement that we'll get
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things you buy to you to the shelves faster i'm joined by the executive director of the ports of los angeles and long beach gene soroka and mario cordona i miss -- i apologize, mario and the president and international longshoreman's union. los angeles and long beach are home to two of the largest ports in america and together these ports are among the largest in the world the best way to make that point is if 40% of shipping containers that we import into this country come through these two ports and today we have some good news, we're going to help speed up the delivery of goods all across america after weeks of negotiation and working with my team and with the major union retailers and freight movers, the port of los


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