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tv   Closing Bell  CNBC  August 25, 2022 3:00pm-4:00pm EDT

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a percent and nasdaq hovering right where it began the hour up about 1%. >> higher for longer, that was the take away from james bullard. >> inflation, that is, and presumably interest rates. >> and the market could be underpricing it. stocks are up and technology the best performing sector. >> thanks for watching "power lunch," everybody. >> "closing bell" begins right now. stocks moving higher as wall street awaits fed powell's speech in jackson hole the most important hour of the trading day starts now i'm carl kwinquintanilla in forr eisen. oil is below 93, vix below 23. sa salesforce weighing heavily on the dow after kcutting their guide. snowflake heating up on an earnings beat.
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today we'll talk to mark fields about california's new effort to ban the sale of gas-powered cars by 2035. first up, though, we'll bring in tony to talk about jackson hole today and what may come tomorrow, tony it's great to have you back. we spoke a few days ago going into the exsymposium. have they found the runway enough is the chair's job a little easier tomorrow? >> it should be. in this day and age, transparency is the name of the game there aren't as many secrets as there once were, especially going back to the first time a fed chair attended, chair volcker in 1982. you can deem this symposium jackson hype because the federal reserve has a very clear strategy which is to make it clear that it wants to move the policy up expeditiously to what it thinks is neutral and then
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into restrictive territory and then hold it there instead of the stop-go policies of the '70s which were widely viewed as a mistake, it will likely be stop and hold. there's an easy prescription and, again, probably a lot of hype one final word, just looking at the last decade, the s&p 500 has only moved 0.2 of a percent on average on the day that the fed chair spoke at the symposiums. and so there tends to be an extra amount of hype surrounding the day. >> oh, no. we like to build it up, there's no doubt about that, tony. >> of course >> esther george today did say she would want to see at least three months of consistent data in terms of looking for relief from inflation that was the first time i had heard a hard number. if we're really in for a volckeresque period, is three months even enough
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>> george is probably suggesting in terms of the downshift from the large 75 point basis point hikes we've been seeing to 50, ultimately to 25 and to zero, it doesn't necessarily mean that the federal reserve will be lowering its policy rate the fed is pushing back on that idea in fact if the fed follows through on what its plan is and the only plan we have is what's in the summary of economic projections, a 3.8% policy rate. that would provide a positive real interest rate so the lesson of history from the volcker period, not talking about the same yields and levels of rates, but in terms of the thematic, which is to move the policy rate up enough and then as the inflation rate comes down, let the real interest rate, which is the difference between the policy rate and inflation, let that move up and hold it there for a while to ensure that inflation expectations are tamped down and one quarter won't do it, it will
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take several quarters or more. the idea of faster inflation is embedded in many generations now, it's knottnot just the boos and would want to be convinced in a few months absolutely from a human behavioral standpoint won't do it. >> fascinating, tony stay with us for a moment. we're going to check in with steve liesman. he's in jackson hole, talked to bullard a few moments ago. steve? >> reporter: hey, carl, yes. jim bullard striking a pretty hawkish tone saying he thinks inflation could prove to be more consistent and that the fed needs to bring rates up now quickly to combat the current inflation problem that we have >> i like the front loading. i like the idea that you get the rate increases in earlier rather than later we've got kpinflation right now. we've got a strong labor market
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right now. it seems like the right time to get to the right neighborhood for the funds rate. >> reporter: president patrick harker said he hadn't decided what to do in september, he could go either way, 50, 75 and wouldn't figure out until he sees the inflation data for august but 50 basis points is still a hefty hike >> i want to see the next reading and then decide. >> next inflation reading? >> yeah. that said, i want to put this in a bit of a history cal context since '93 the fed has raised 83 times. 75 of those were under 50 basis points a 50 basis point move is still a substantial move. >> reporter: okay, where both agree is rates need to move higher the question for tomorrow is the extent to which powell affirms bullard's hawkish talk or a more
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moderate approach to rate hikes. we'll get a full coverage of powell's speech and talk to rafael bostic. >> steve, we began the session 10-year 3.12 and ended up around 3.02 after bullard i wonderi if that reaction fits with him. >> yeah. when bond markets hears more fed the long intends to come down and short intends to come up when you look at the fed rate outlook from the futures market, april 23 contract hitting 3.79 i'm pretty sure that's a high for that contract. so what's happened is the market is moving up its outlook for federal reserve rate hikes and the market and the fed coming close. 3.80 is the rate that the consensus has pegged in for 2023 not much difference where they're going.
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still that great cut is built into the market that several of our speakers today pushed back against. >> strong work today, steve, as the blue skies came out. a lot more ahead steve liesman with a great crew in jackson hole today. tony, really quick before we let you go, there's the rate discussion and this ongoing warning. morgan stanley today, qt is going to be a lot worse than people expect so far how much of that becomes part of the conversation after tomorrow? >> well, imagine, carl, if you went to a supermarket and there were a thousand items on the shelf one day and zero the next and only a few trickled back a few days later the price of those few items would probably still be high this is another way of saying what the fed has taken off the shelves, the trillions of dollars of bonds, has a long-term effect they call it a term premium effect, a stock effect it's greater than the flow effect and can last many years so i wouldn't overly worry about
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the qt in terms of impact because lots of bonds are off the market and will have a meaningful impact for a while. >> tony, appreciate it very much for helping us kick off the hour a big day tomorrow when we come back, california lawmakers voting today on this proposal to ban the sale of gas-powered cars by 2035, a move that could spark a seismic shift in that industry we'll talk about what it means with former ford ceo mark fields next you're watching "closing bell" on cnbc. (vo) hi. we're visible. a different kind of wireless company... ...running on a big impressive wireless network. how are we different? we exist only on your phone. so you get unlimited data for just $30/mo, taxes and fees included.
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let's check out today's stealth mover, it's freyr. they see the company as a strong beneficiary of the inflation reduction act. a catalyst for the stock is the partnership with cox strategic platforms to build a giga factory in the u.s and a factory in norway set to be the most capital efficient and sustainable giga factory in the world. in some other ev news, california is set to issue rules to require all new cars sold in the state to be free of carbon emissions by 2035. it will phase in over time 30% of new passenger cars by 2026 would have to be carbon free climbing to 68% by 2030
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mark fields is the former ford c ceo. mark, it's great to have you i wonder between the california prop and the credits in the inflation reduction act if we are at some kind of tipping point on ev policy. >> well, i think we absolutely are at a tipping point at the ev policy and looking at the inflation reduction act not only what's in there with the tax incentives for consumers but there's a lot of grants and incentives for manufacturing and automakers to build battery facilities manufacturing plants here in the u.s. so it very much is a watershed moment it all comes down to how it gets executed obviously it's quite confusing with some of the criteria you have to meet to get the tax credit incentives. that will work it out over time but it very much is a watershed moment. >> is california a good tell on how national emissions policy develops >> well, it's a bellwether
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for any other reason, there are 17 other states that typically follow california's current auto emission standards so the vote that they take today by the california air resources board, that's going to reverberate well beyond the borders of california. that's going to cause the industry to speed up its switch to the evs of course it then comes down to the ability of the industry to actually do that given the fact they have to procure a lot of elements, they're in short supply and very expensive, an battery plants to get capacity there. so it's going to come down to the execution. but yes, it is a bellwether for the rest of the country. >> as for pricing, we do have ford opening up some order books on the mustang, i think, with some price increases tesla raising the price of some of their software. all of that is happening as used car data is starting to roll over and we're a couple of months away from it going
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negative year on year. what is happening with auto pricing right now? >> you do see seasonality in the used car auctions so that's a little seasonality all these automakers, they know that the margins that they make on evs are lower than the internal combustion engine vehicles if you think of just the input costs, whether it's the elements like lithium, cobalt and nickel or just the battery packs themselves, it's gone up exponentially this year. so to protect those margins from going negative, you're seeing folks like ford and gm and tesla be very aggressive in pricing. they're saying hey, listen, it's not a problem because they have large order books and waiting times, but the real test will come when it comes to mass adoption when they're bringing out all that capacity, at the end of the day the consumer has to be able to afford it
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so that's going to be very important going forward that the industry is going to have to face with rising input costs and having to sell more to the mass market, which couldn't afford $60,000 vehicles. >> speaking of being aggressive and competition, ron baron was on "squawk box" and talked about being bullish tesla. thinks it can still be a three or five-bagger the next ten years and talked about how he is maybe obviously unhappy with mercedes' competing product. here's what he said. >> after opening a mercedes car last night, i hated it the electric mercedes. it just -- the battery is in the wrong place, the center of gravity isn't right. >> is that just a taste of the trash talk we're going to be hearing the next few years >> yeah, you're going to see a lot of trash talk. he's got a big position in tesla. what do you call that, talking your own book? everybody has got their own
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opinions listen, the bottom line is all the major automakers are coming out with really, really good electric vehicles over the next 12 to 24 months. the question is are consumers going to show up, particularly at elevated levels of pricing. but there's going to be a lot of trash talking going toward. >> finally, mark, experion had some data out today. the surging pricing and surging reliance on financing a car. the average new vehicle loan, record high $40,290. how much are you watching the trajectory of delinquencies? >> well, you have to watch that. i'm watching that very, very closely. it's not only the delinquencies, but it's things like repos and things of that nature. interestingly enough, carl, back in the great recession, at ford we had expected that you would see big spikes in elections and repossessions, et cetera actually what we saw is people were more willing to stop paying
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their mortgage than actually stop paying their car payments because that was a way for them to get to work and things of that nature. so you might see that going forward. yeah, it's not only just the rates and dollar amounts per month, but lendiers are extendin the time periods 96-month loans, that's a long time. >> and you're right. repossession is a handicap if you need to get to your job. absolutely it's a lifeline mark, fascinating time in the business, we'll talk soon. mark fields. >> thanks, carl. let's check on the markets dow hanging into a pretty tight range but all in the green for most of the morning and the afternoon after the break, the dark cloud over salesforce. the dow component falling hard after trimming their guidance. mike santoli will take a longer term look at that name when we come back. it takes a village to support society and businesses have a responsibility
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time for today's market dashboard. mike santoli is here with a closer look at this sell-off >> yeah, salesforce is the biggest drag on the s&p today. also happening at a time with lowered guidance where there is a lot of pressure on the cloud from high heights, though. here's a good look at the changing taste and fortunes of parts of this market so you have the virtual economy ascendant 2018 into '19 and then the real economy, the real asset stuff like exxonmobil. you had a complete run away from it now we've come all the way back. actually exxonmobil more than doubled the market cap of sales force. so it does show you how things have turned. now, since it became a public company, salesforce, the better part of two decades ago, it has been very expensive on all traditional metrics. take i look at what's happened here relative to microsoft over
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the last decade. this is in terms of free cash flow yield and you see a higher free cash flow yield at the moment for crm meaning it's less expensive than microsoft. look how cheap microsoft was a decade ago it has massively outperformed salesforce during this time period you can argue both of them look a little rich right here it's lower than the overall markets. it seems a sign of maturity for better or worse and sales force is now in this category. the sli versus the s&p today, 52-week high? >> industrials have quietly been an outperformer. it's actually very well distributed so it's tough to really get too concerned about a global steep slowdown in parts of the economy when that's the case and the relative performance looks good. >> we'll keep an eye on that when we come back, retail names on the move today. names like abercrombie,
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bit of a pop on pinterest on the strength of its new app. shares just a few dollars from a four-month high. julia boorstin is watching that. hey, julia. >> carl, that's right. pinterest is going up because of its shuffles by pinterest app. it surged to number five for the lifestyle category in the past week, rising in popularity after trending on tiktok
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this is a big win for pinterest that has been strugglingwith declining engagement but it did see the stock get a boost when elliott management took a 9% stake in the company in july boosted by that stake and today's move, it's worth that pins has outperformed meta and snap so far this year. carl. >> all right, we'll watch that, julia, thank you. meantime a fresh batchof retail earnings came through today. abercrombie and fitch, burlington stores both in the red. after the bell we'll get earnings from gap which is expecting net sales to decline joining us today on the news line is dana telsey. dana, it's great to talk to you. one point that you've made is that even after all of these prints and all of the comments about inventory and the lower end of the consumer bound, the market was prepped for it in a sense. >> exactly, carl thank you for having me. nice to see you. so yes, i think overall when we're taking a look at these resets that are going on, it's
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been six months that we've been hearing about what the catalyst could be and whether it's inflation, the high cost of living for the lower income consumer, we're seeing a bifurcation from the high ending and low end. what's happened is that the reset in stock prices anticipated what the reset in earnings was going to be so they have anticipated the stock price is already down and now they're looking to '23 and '24. >> now that we're looking ahead, we're in the midst of back to school if we're looking for a clone holiday, which areas of retail will we look to first? >> overall nobody is going to have a clean holiday luxury goods will continue to be the cleanest because the higher end consumer is spending the other area, we're continuing to see cosmetics doing well with social occasions and going out and this holiday season with events, i think you'll see strength in cosmetics.
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everyone else on the apparel side, it is batten the hatches, markdown pressure and margin pressure what i'm looking for, what's inventory levels at the end of the fourth quarter so we can go in with some better anticipation for 2023 and what margins could look like. >> on the meals of williams-sonoma which was a pretty decent quarter, you actually see some interesting differences between the home category and, say, home improvement? >> exactly one of the things that's been so interesting on the home side, we've seen pressure at kohl's, at target, at tjx and even walmart called it out. on the flip side, home improvement is holding up, especially among the pro customers at both home depot and lowe's it's a real difference in terms of soft lines versus hard lines. >> finally, i mentioned some of the themes you're working on in some of our recent work. one i thought was fascinating that european exposure is
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benefitting because of tourism and spending there, ralph, vf, lvmh it runs counter to the broader concerns about helping the european economy. >> it does, and they're benefiting from tourist spending, but some of these brand names on the soft line side are benefitting from local spending too and that's why as we look forward, i think some of the weak innness in europe we saw lt year, you're going to see some growth they reopened later than we reopened in the u.s. >> good to talk to you as always. >> you too thank you, carl. meantime, the dow is picking up a little steam here, up 176 as we get closer to the end of the session. pretty much session highs. the street is buzzing about this expected tie-up between ma'a amazon and plug. we'll take a look at what that deal does for the future.
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what is the street buzzing about today? plug power for one thing they are surging after amazon said it will expand its partnership with the company to power some of its operations pippa stevens has a closer look at the company and the deal. pippa. >> that's right, carl, this is an expanded partnership between the two companies. now, before we get to the deal, a little refresher on plug power. the company makes hydrogen fuel cells that are used in machinery, trucks, and stationary power some of this is so-called green hydrogen which is made with renewable energy, there by cutting emissions during their
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production process the customers include fedex, boeing, walmart and home depot now, today plug said it will supply amazon with about 11,000 tons of green hydrogen per year starting in 2025 to put that number in context, that's enough to power 30,000 forklifts or 800 heavy-duty trucks annually. as part of the deal amazon gets a warrant to acquire up to 16 million shares of plug now, wall street liked what it heard. evercore isi saying it validates plug's strategy. oppenheimer saying it could bring additional large-scale customers to the table and wells fargo saying it improves the visibility of long-term targets. it may not be a household name but it's been around for decades. it hit an all-time high during the dotcom bubble and shares are down since they struggled to gain widespread attraction and has
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its fair share of critics including those who say the renewable energy used to make green hydrogen should be used for electricity. >> pippa, a couple of different thoughts one is the inflation reduction act. we're trying to parse through the impact of a lot of those green initiatives in that act. when you think about amazon's scale and its power, is rivian a cautionary tale or not >> first on their inflation row d reduction act, that is a huge catalyst shares of plug power off about 80% since we saw them announce that deal. we've seen other names all rise and that's because there is a tax credit for green hydrogen specifically that right off the bat would make it more cost competitive with other forms of hydrogen, like gray hydrogen, which is when fossil fuels are used in the production but hydrogen power has been the next thing for several decades now, and so certainly these stocks are getting another look
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here but whether or not it proves long-time viable, that really remains to be seen. >> right hard to discount as we said the amazon can bring to a company like that. we'll find out a lot more i imagine in the months to come. pretty interesting definitely getting buzzed about today. tesla's three for one stock split taking effect today but one analyst says there are better bets to take in the space. plus peloton back dapeling when we take you inside the market zone, next. ♪ ♪ ♪ ♪ all-electric with room for up to seven.
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we are now in the "closing bell" market zone. mike santoli is here to break down these crucial moments of trading. craig irwin on tesla's split and bertha coombs on amazon's health care pivot mike, i wonder what you make of the market really not going into powell's speech tomorrow with a lot of hand wringing. >> no. i think the market is reading the messages that have been out there from other fed officials and essentially saying they're not out of step with what they're likely to hear tomorrow. sure, they're going to prepare the market to keep rates at a higher plateau for some period of time and not look for an opportunity to cut them next year but that seems digestible the s&p 500 has grinding or drifting higher here we've gone above the levels everyone was hoping to hold.
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it's a benign reaction i wouldn't say that it's really driven by any particular catalyst or growth indicators, it's much more about i guess we're more or less in gear with what the fed is going to tell us. >> you do say it seems sensible to work on the premise that the june equity low was a good one, although you and i did talk this morning about goldman's warning that liquidity will fade in the next few weeks. >> for sure. even if that low from june is going to hold and maybe is the start of a significant uptrenduptrend, it's a ways down from here i just think that there was enough proven in the ramp off the lows that you have to kind of keep that in mind if you really wanted to get aggressive on the downside or avoid trying to participate in this market now. >> mike, we'll talk more in a few minutes. in the meantime, take a look at tesla, dipping a bit lower
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shareholders received two additional shares for each one they already owned as of august 17th stock is up better than 165% joining us today craig irwin, roth capital senior research analyst. fair to say you remain wary because of valuations still? >> i am bearish for tesla on valuation. i think there's a lot of other properties people could put money to w in and make a lot of money over the next few years. >> we've talked a lot about splits the last few weeks but again today. is there a sense net-net whether or not -- i mean is it a wash, is it net bullish, net bearish how do you view tesla in the 200s rather than the 900s? >> usually what it is, it's an indication that management is themselves excited about further value creation, right? tesla will be doing -- making
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40,000 cars a week by the end of the year their capacity jumped to 1.9 million units in the second quarter. so they're obviously executing impeccably they want to hold on to the valuation and make it easy for retail to buy the stock because retail is such a large component of the shareholder base in tesla, such a large driver of the valuation. so, you know, functionally, yeah, it makes sense for them to do this. and typically large cap stocks when they're splitting do perform pretty well. we're just skeptical because we see a lot of good things on the horizon. you just talked about plug there's many other companies in the ev space that are doing really exciting things tesla has ton the heavy lifting and hard work, making it much easier for them and they're able to poach employees from tesla and execute business plans with less risk and more capacity than the market
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>> mike? >> yeah, i totally agree that part of what keeps tesla where it is, is this constant encouragement of the public excitement and the idea that they are building and creating the future as they only can do it you know, if you look at that valuation premium as the ability if they need to to raise capital down the road and attract people, that's half the product in addition to batteries and steel. no real reaction today to the split itself that's probably a good thing keep in mind we're still trading on a split adjusted basis, what's the high, 400, and now we're just under 300 so it seems as if we're still kind of chopping around. it's held up relatively well compared to some of the other stocks that really went into moonshot mode during 2021. but still hanging in there fine. >> finally, craig, we had a talk with mark fields a moment ago about ev policy. ron baron on our air earlier
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today would clearly argue, although to his own benefit, that policy is moving ev's direction and obviously consequentially in tesla's direction. >> ev is the future, there's no question i encourage everybody that's considering to buy a new car to test drive a ev. i love my ev i'll probably never drive another one. i'm have one for my wife or my kids president biden has done the right thing with baby bbb or, you know, the infrastructure bill as well both of them have great support both from evs and ev infrastructure, incentivizing investment in materials and supply chain this is what the united states needed to pick up the reins and start leading again. tesla did this with very little support and now there's support
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for the whole industry that's again one of the reasons why i'm pretty skeptical on tesla. i think you've got some great automotive behemoths that are going to be really well. the mach-e is an awesome car if you hear his version for the spin-off it's exciting i think people will have lots of other exciting things to invest in other than tesla. >> it's going to be a cage match for sure craig, appreciate it very much good to see you talking a little tesla today. actually getting some news this afternoon on twitter. some orders from a delaware judge. julia boorstin has got it. j.b. >> that's right. some orders from a delaware judge after that hearing yesterday. the delaware judge has ordered twitter to turn over some of the data sought by elon musk, specifically asking twitter to turn over data from 9,000 accounts that were reviewed by twitter in a fourth quarter audit. now, the judge did reject many of musk's demands for data from
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twitter, calling those demands, quote, absurdly broad. but they did respond to this request for data on those 9,000 accounts and this is essential here because this is all going back and forth between twitter and elon musk's attorneys ahead of that october 17th date so we're going through this ruling by the judge here on the issue of the data and this just coming through today on the heels of that hearing yesterday, carl. >> interesting i'm just looking at the share reaction here. i can see an argument, julia, where you would say a little incremental fuel for musk's case, but maybe that quote you gave, absurdly broad, adds to investors' notion that maybe the pressure is on musk to prove something. >> look, it was so interesting because of course the whistleblower -- the news of the whistleblower came out just as there was that hearing yesterday. listening into the hearing, musk's attorneys certainly seized on the fact that there are new questions raised by the whistleblower to support their case but on a number of the accounts,
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the whistleblower did say twitter was dealing with some of those issues of spam and bots. there was a whole issue of more questions being raised through this whole process here. it's notable that there's this question of how long it will take to get that data on those accounts twitter's attorney said it would be a week to ten days with manual labor from twitter to dig up that data again so there's a question of whether or not could this trial be delayed. there is a sense that the trial will go forward on the 17th of october as planned musk's side is pushing for a ton of data. the fact that all of his requests were not addressed by the judge does mean that it does seem like there is some sense that twitter has been sharing data with musk as required >> yeah, that's well said because it's about the arguments but also about the timing for sure julia boorstin on twitter this afternoon. julia, thanks. let's get to amazon now. the company shutting down its telehealth service, amazon care,
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according to a leaked memo first reported by geek wire. that is boosting teladoc today it comes just days after amazon is joining a bidding war for signify. bertha coombs can talk about how big of a surprise this is as the company is moving forward with other acquisitions in health care, bertha. >> one source told me last night he doesn't see this so much as an end but a beginning amazon was playing from behind in trying to build a virtual care platform for employers. it was playing behind teladoc, behind doctor on demand and even one medical, which is in the process of acquiring and if it does acquire one medical, one medical has relationships with 8,000 employers. something amazon just was never able to really build on or get any traction on, so it makes sense to cut your losses and focus on where you can grow. move to where the ball is going. the signify health, if they get
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that along with one medical, those two acquisitions would definitely be very transformative for amazon and make them a much potentially bigger player in health care but still they would have a big hurdle to really grow both those platforms. >> yeah. to that point mike santoli, bernstein today said i get the sense investors are a bit confused about amazon's strategic priorities and today's announcement does nothing to alleviate that. >> right, it's fair. i guess one of the benefits of being a $1.3 trillion company that's all about kind of the future as opposed to delivering current numbers is you can experiment and find your way and obviously run down some dead ends which might be what this was in this particular venture it really does remind me of walmart and prior generations where it would do something similar to this. open up a bank in utah and say we were going to be in the banking business but everyone got really excited about the chance they were going to
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disrupt another industry so i get the confusion i don't think it's the big thing swinging the needle for amazon in terms of the overall outlook, but fair to say that maybe the market likes the fact that they're not going to just sort of continue down a road that they didn't feel as if they were going to gain an edge in. >> yeah, maybe some costs in there. by the way, the dow picking up a little steam, up 250 let's take a look at the drawdown in peloton today. shares falling after slumping sales for q4 a day after surging on that news about the partnership with amazon marks six straight quarters of reported losses. peloton says it hopes to reach break-even cash flow by the end of fiscal '23. shares down 63% since mccarthy took over from founder john foley. lauren thomas joins us now we've had some fun today going through some of these metrics, lauren. >> yeah, definitely. unfortunately for peloton, it does look like the company is going to erase today most of the gains that it did achieve yesterday, like you said on the
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heels of that amazon -- news that the amazon partner. i think obviously the fourth quarter results that peloton put out this morning were dits appointing in and of themselves. but tpeloton leaves investors ad analysts with a lot of questions. the ceo, barry mccarthy, is certainly trying a lot to turn this business around peloton has tested everything from renting out its bike to hiking membership fees it's also played around with pricing of its equipment products but at the end of the day it really remains to be seen if those are going to play out. so mccarthy said on the conference call this morning this is really skomething, a turn-around that investors will stick around for it's proving to not be an overnight success but something that the company is going to continue to work to. like you said, does expect to achieve that break-even cash
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flow by the second half of fiscal 2023. >> mike, the company did take pains to say look, we're already getting searched for on amazon and our presence isn't there yet. i saw a lot of notes trying to guess which would be the next big retailer to carry peloton bikes. >> sure. it would enable the company to soak up whatever latent demand is out there i think the bigger question and the issue for the stock is the question is always what percentage of the likely number of peloton customers had already bought bikes and gotten into the ecosystem during the pandemic and how much was left to follow after that markets struggling with this idea you see revenue going down yeah, subscriptions look like it's solid, growing as a portion of the overall mix, but it's not quite the whole company yet. that's the state the company is in as it tries to get to that next phase when maybe there's another wave of converts to the peloton brand.
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>> look at those wild swings just in the past 48 hours and lauren is all over it. buy now pay later affirming q4 results after the bell. investors are going to watch for a sense on the strength of the consumer and see how the business model is holding up joining us on that, steve kovach steve, what should we look for before apple tries to own this space later? >> that's right. but first let's talk about today. we're looking with affirm looking for gross merchandise value. that's the total cost of stuff people buy through the platform before the merchants get paid from affirm. last quarter, that was up about $4 billion speaking of growth and transactions, that means growth and transaction costs for affirm, so they guided up to $355 million in transaction costs. that's their biggest cost that they had to do every quarter and then speaking of the consumer, what kind of health
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will we see in the consumer. we've gotten so much data during this earnings season on that we're getting fiscal year guidance for their fiscal year and that should give us some guidance as to what they expect going into the rest of the year and the next year from a consumer spending standpoint and then apple within a few weeks is larging their buy now, pay later called apple pay later on just about every ios device out there. >> apple is in for a couple of wild weeks between that, the phone, the event tim cook and johnny ive and lo lorene on code don't miss affirm founder and ceo on "tech check" at 11:30 a.m. eastern time. we'll get those results in just a few moments. in the meantime, a little climb into the end of the session. the dow is up nearly 300 points. interesting ahead of the fed chair, mike. what do you think the market
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knows or thinks it knows >> i don't know if it necessarily has a fixed idea of what's going to be said tomorrow it's much more about nothing that is being said already seems particularly surprising. we had a 2% shakeout on monday there was no downside follow-through 10-year treasury yield making new lows through the day it's at 3.02 just a second ago so there's a little inverse stock in some of the mega cap stocks the internals of the market have been pretty sturdy all day the average stock is outperforming, about 2-1 advancing to declining volume. now it's up to 5-1 so people felt underinvested and this market wasn't going to break down still, the highs last week are 4300 we're just approaching 42. take a look at the high beta sector on a quarter-to-date basis, it's been a risk-seeking move that's recovered relative to the market, up 18% in just those --
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month and a half or so and the volatility index has come in. clearly underscoring the idea that nobody is on alert for too much of another stress event tomorrow keep pointing out every low on that chart in the vix has been higher than the one before for the last ten months or so, so that's a pattern that we'd have to break but for now it's cooperating, down a full point going into chair powell's speech tomorrow. >> just about a minute left. really quick, with nvidia and even crm, it's not like the bears didn't have a shot at the ball today. >> no, absolutely. so far the misses have been sequestered off to the side, not really blowing up full sectors, at least for right now, and that's a net benefit most stocks are still off their highs in hard-hit areas like retail and semis so that explains some of the resilience perhaps. >> was we get to close here and start counting down the hours
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and minutes to the fed chair, the dow up 306 you see the s&p with a gain of about 1.33%. the vix did settle a bit below in the low 20s oil settled a bit lower. after bostic and bullard and harker and george, it all leads up to the big event tomorrow in jackson hole let's get to "overtime" and the judge. carl, thank you very much. welcome, everybody, to "overtime. i'm scott wapner you just heard the bells we are just getting started here at post 9 at the new york stock exchange affirm and gap earnings are imminent, both giving us a good read into the strength of the consumer the stock moves that always follow in just a few minutes i'll stock to jonathan krinsky on the critical levels in the market that he is watching. we do begin with our talk of the tape prepping for powell. what stocks are likely to do no matter what the fed chair says tomorrow in his highly amend speechl at


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