Transcripts For CNBC Closing 20240704

Lackluster trading an ugly chart for the biggest in the market and shares have fallen 11 this month alone. Intel and microsoft also a drag today and its hard to get much going for the nasdaq as well given that tech slide weve seen and the continued march higher for yields take a look, the 10year higher again, pressed against its highest level since last october. It takes us to our talk of the tape state of stocks and why some say this correction is not over. New edges Cameron Dawson making the case here now at post nine good to see you again. We should note as were at the lows of the day, the dow has reached it 50sDay Moving Average. Why do you argue today that this has more to go the confluence of evidence would support theres more to go because of seasonality, were in a bad seasonal stretch, september the worst month. We know momentum has turned negative in the near term on a tactical basis and breath, the number of names trading above their 50Day Moving Average, its not washed out yet, so theres still likely some churn and digestion to go. Weve crossed under the 50 day likely support at the august 2022 higher, and then well see how we deal with that support level. What do you make of this alleged change in mentality from what was a decidedly buy the dip market to what has become a sell the rip market i think the first thing to acknowledge, it is very tactical the strategic longterm investor this shouldnt change from what your plan is i think we can put it in the context of the 50day. Prior to the selloff we were trading above the 50day every time we traded down, april and may, we bounced off of it. Today is different, were likely going to be in a period of lower highs, lower lows. You see people sell into strength. Want to comment on the idea that until apple, biggest stock in the market, which is down 11 this morning, the worst mega cap this month and 10year yield which creeps higher, till those two stabilize, were going to be having similar conversations i think that is hyper critical apple alone puts its 200 days in sight for the next level of support. Being a behemoth and important part of market psyche its hard to imagine the market pressing higher without the contribution of apple and other tech names which have been trading weak as well. Joe terranova is with us, a cnbc contributor of course you want to give us your sort of read on whats happening here, waefz come on the air, weve reached the 50day on the dow. Were more unsettled. Mega caps and technology were the leadership it was the very first time that weve had leadership in the market since the onset of the pandemic we welcomed it you cant lose leadership and expect the market to fight up against what is, obviously, a historically weak seasonal period. Yes september and october. Cameron mentioned apple breaking down below the 100 Day Moving Average not just apple you have microsoft and tesla, so if my path is accurate here, its probably 15 or 16 of the overall s p 500. Apple alone is like 7. Microsoft is somewhere 6. 5 and tesla is right below 2 . So, you know, youre talking about close to 16 of the s p trading below its 100 Day Moving Average. Were in the seasonally weak period and i think the question becomes this, if you were a 2022 bear you believe this is the beginning of a deeper decline back towards the october lows. Most of the 2022 bears have been 2023 bears because they missed it. They werent positioned correctly to take advantage of the big run in mega caps that saved the market. A 2023 bull which i am, you believe that ultimately at some point, not now at all, some point, as we move to the back half of september into october, theres a tremendous buying opportunity. If you go back, scott, over the last 33 years, theres been 10 instances in which the s p 500 in the first half of the year, rose by 10 or more. In each one of those 10 instances, the second half of the year was positive. If, in fact, that is going to be the setup as we move into the Fourth Quarter, youre going to have one heck of chase for performance. All the 22 bears have to come around at some point. Youre, you know, part strategist, part historian, part it technician. You view the market through so many different prisms. What about one that joe puts forth . This correction, as of right now, is not about growth fears thats very different from 2022. 2022 we saw eps revisions go down 10 we saw the weak recession or the weak gdp quarters that we had, so people had a kick up in recession fears. You dont have growth fears when atlanta fed gdp is at 5 this is about yields and valuations, why the highest valuations parts of the market are underperforming. Im glad you went there because of the idea we got here in the first place was multiple expansion from the very names in which youre referencing that have pulled back over the month of august. Exactly if you look at the s p 500, the entirety of the move this year has been multiple expansion anticipating a better earnings environment. The thing that has been the most surprising is that despite the fact that weve had a recession call or recession, no recession, landing, boom, banking crisis, earnings system for the entire year have been static. They havent moved so all the volatility is driven by valuation and multiple, which makes it susceptible to moves in yields static might be the new up. They havent gone down. Yes. Which is a big part of the story. They havent deteriorated to the point where some thought they might. Flat is the new up maybe for earnings for a while. Yes and i think that that is the big contrast of 22 all about earnings coming down so i think watching 2024 earnings to see how if they get revised higher because of this gdp growth, that can offset some of the multiple compression, but we do have to remember is that were pressing into this new high group real yields and that near peak multiples, that is a challenge for these high flying names. We wanted to add a voice into the conversation given the nature of how the market feels over the final stretch ed ardeneny is with us so much appreciate you getting with us. Are you getting nervous as bullish as you are actually ive been saying that market is probably going to be flat to down this during the second half of the year. We started out the year with lots of people saying it was going to be a weak first half and strong second half ive been bullish during the first half with once we got to 4600 at the end of july thats my yearend target, im not going to raise it from here ive been thinking we would get down and break down below the 50Day Moving Average, and i think we could be retesting the 200Day Moving Average i think were in a correction, and i think its largely a result of what were seeing in the bond market. Weve gone from oh, my god, the economy is going into recession, to oh, my god, the economy is flying, and inflation is going to come down i think that once we get through this pullback, which is what i think it is, i dont know if its going to be a fullfledged correction, i think the market will focus on next year and the next years outlook for earnings looks really good and i think the fed will be looking at inflation coming down and i think theyre going to be lowering Interest Rates. I view this as a seasonal fe nomg non. Alluding to the fact what we have is good news is bad news market. Yes. The economy being too strong. Right. Not only as you say keep inflation stickier but keep the fed engaged and we dont want to deal with that well, thats the consensus. If you look at the july cpi excluding shelter, which has really been the only really sticky part of the inflation story, the headline cpi inflation news report was 2. 0 the core cpi excluding shelter was 2. 5 so weve made a lot of progress on the inflation front people are still getting stuck with this shelter component which is going to come down sharply over the next six to 12 months. How do you look at the issue ive discussed a bit with cameron and joe, about apple, right . Biggest stock in the market. It has had such a tremendous year, even with an 11 pullback this month still up this year but the idea that you cant really get solid footing while the biggest stock in the market is, you know, a little squishy well, i agree with the conversation you already had with your panelists. I think theyre right on the money. The mega cap 8 accounted for 2 of the s p 500 market cap at the end of july. Its more like 30 and now come down to Something Like 27 so we have seen a substantial decline in the mega cap age. They have lower to go. They have a valuation issue, but on the other hand there are Great Companies and i think this will turn out to be another buying opportunity, as was the october 12th low. You know, joe, the value players, the cyclical people, say theyve made the argument all along, largely i think because they havent been in the stocks, that the market can go up market doesnt need these mega cap names. Doesnt need apple to go up for the market to go up. I think whats being proven out, at least here, is that youre going to have a lot of trouble if mega cap continues to fall like ed thinks it might have to, like cameron suggested it could too. As long as you have an environment youre worried about the economy slowing down, the fed being engaged and china very much an unanswered question, if not the answer youre getting from there that you dont like without question. Look, the market is growth the market becomes more and more growth as we move through the process of time. If you think about a potential catalyst for the market in the next couple weeks, it comes from growth it comes from the fact that maybe nvidia is going deliver something that looks similar to its previous Earnings Report at the end of may im not saying its going to do that but its not coming from the Value Segment of the market. I think energy is the one outlier in the conversation. I think for investors looking to do something right now, momentum has been within energy over the last six to eight weeks and i view it as only intensifying as you move into whats a seasonally strong period for energy, and keep in mind, energy is up near the top end of its annual range, despite what were hearing about the deflationary pressures in the chinese economy. Im glad you brought up nvidia, now just given, cameron, where everything is and how edgy the market is, i know i keep using that word, it feels like thats where we are, i dont want to use unsettled that much, its orderly whats happening, obviously, its not like the the s p is only down 4 . Its not been this tremendous decline by any stretch of the imagination. It raises the pressure on nvidia next week. Otherwise its an earnings air pocket nothing going on you have jackson hole. You dont think the fed will go in september what do you have you have one of the biggest stocks in the market reporting earnings next week that had a massive run, a little bit of a pullback and now questions as to whether its going to pull back further. No pressure, right. If we look at nvidia, its earnings estimates for 2024 went up 75 following that may quarter. It would be a lot to imagine it would have a similar move higher, similar kind of beat but i think if we look at the semiconductors overall theyre down about 10 from their high if you retrace another 8 , you will have closed the entire postnvidia move from may. Thats probably an opportunity to revisit the space once weve seen some of that washout. It is an important tell and i think so goes nvidia, so goes the market. So we havent really discussed it yet, but theres something within the market that is so incredibly important why are bonds not rallying the s p 500 is declining significantly. Its in the midst of a strong correction why are bonds not a safe haven asset . That just increases the pressure on chairman powell next week at jackson hole tremendously. The concept of fighting the fed, hedge funds and speculators, short treasuries, fighting and theyre winning, and i will say this, he has a very difficult job because he potentially could send the bond market parabolic if he signals something that is uncomfortable to investors the bond market is not doing what its supposed to be doing in this environment. Its not supposed to be selling off. This is your wheelhouse, want to comment on that yeah. I think joe is absolutely right. There is a lot of pressure on powell in terms of what he says. Everything will be clearly very important. I think hes going to basically follow the lead of john williams, the president of the Federal Reserve bank of new york, and say look, were seeing some signs of progress on bringing inflation down and if it continues to come down, were probably going to have to lower intere Interest Rates next year. Im expecting him to say that. I think he realizes if he doesnt say that and the bond yield goes parabolic as joe said, that would be a disaster for the Banking System in terms of commercial real estate defaults. You know, ed, i want to come back to you on something you suggested earlier about your level of bullishness after we had kind of first half we havent yeah. You have an extraordinarily lofty target correct. Some would suggest for the s p and, you know, it was only a few weeks ago in which you suggested there was still a lot of room to run for this bull market which you suggested this undeniably was yeah. Look, i think weve been in a bullish channel in the market. I did think that when we got to 4600 at the end of july, that that was my target for the end of the year and, so i turned more cautious and i do see this selloff as continuing somewhat. I think this is a shortterm phenomenon it will turn out to be a buying opportunit see 5400 on the s p 500 by the end of next year ive been at the top end of the range of earnings expectations im still using 225 for this year, 250 for next year and 270 for 2024, multiply 270 by a multiple of 20 and you get 5400 which incorporates the view that the mega cap eight are here to stay and going to continue to keep the valuation multiple of the s p 500 elevated relative to history. Ed, really hit the nail on the head miss projection is lofty because its based on a much improved earnings picture and projections for next year have gone up, right . Youve had three straight quarters of negative Earnings Growth we all know that story the projections would tell a far different story, as you get into next year. Yeah. Whats already priced into the market today is 12 Earnings Growth in 2024, and the question weve been asking is how much higher can that go what you have baked into that estimate is a return to record margins, which is a little bit of a stretch mostly without inflation. Inflation is good for margins in the sense it drives Revenue Growth, Revenue Growth drives incremental margins. If that starts to deceleration with lower inflation, you ask the question if its not 12 , can it really be 15 or 17 or more like 9 . You think were too lofty in what our earnings expectations are for next year . The market, as you know better than most, the market has that tendency to look ahead by whether 6 to 9 months. Its going to anticipate an improving earnings picture which is one of the reasons why the market was able to rally to the degree it did because you assume earnings will get better in the near term, rather than too far down the road. Do we need to rethink that i dont think you have enough evidence to suggest you need to rethink that right now the upcoming quarter is a prove me quarter guilty until proven innocent as you look forward over the coming three or four quarters the current expectation is, youre become to doubledigit Earnings Growth once again there was enough in the latest release of earnings to feel comfortable that the inflationary pressures were beginning to mitigate the effect of, you know, compressing margins significantly. I think you still need another quarter of evidence to feel comfortable that the expectations as we look forward into the future, theyre realistic. Im looking at a couple sectors, ed, and i want your opinion on them too. In terms of we can get away from technology and Comp Services and things that we obviously know theyre weaker, the market is going to be having a problem discretionary over the last week is down 4 the banks are down 2 and 2. 75 comment on the importance of those two areas. The consumer has been a large part of this story we know that. Right. The banks had traded well for a bit, and im wondering how you would characterize the importance that they have at the given time, when youre already feeling as edgy as weve said the markets look i think a lot of this, as you know, is seasonal. I think a lot of the edginess is related to fears that the bond yields will go higher. All of this will depend on the inflation views. If im right and inflation views continue to moderate, i think the edginess will evaporate and we will have a yearend rally going into 2024. With regards to the performance of the sectors theyre acting consistent with a fairly broad pullback in the market here. As joe pointed out, energy is the outlier. A little bit of a mini deja vu of the bear market where the Energy Stocks outperformed everything else. I think its a mini version of that i think the consumer is in great shape and the financials, im waiting for just a wave of m a activity to small mid cap banks are going to have to go through that because theyre dealing with some pretty hefty regulatory costs and that will be a requirement for cutting their costs. Well leave it there. Ed, so much appreciate you jumping on with us as we watch the markets over the final stretch. Cameron to you as well see everybody soon our question of the day today, we want to know, do you think apple will trade into the 150s head to cnbc closing bell on x. Vote yes or no lets get a check now on some top stocks Kristina Partsinevelos is watching as we head towards the close. The same macro concerns weighing on the Broader Market appear to be overshadowing a very Strong Quarter for walmart. The retailer Beat Estimates and raised fullyear forecast. The cfo John David Rainey told cnbc there was modest improvement in sales of big ticket and discretionary items nonetheless shares are down 2. 5 right now. Hawaiian electric is falling as the Utility Company is in talks with restructuring firms over its potential liability in the maui wildfires the stock is trading at the lowest level since march of 1985, heading for its worst week ever, down 65 over 65 percent. Today its down 21 . See you soon. Were just Getting Started here on closing bell. Up next, betting on a bull market chris hyzy from merrill and bank of America Private Bank is back breaking down his strategy as we wrap up the summer and look towards the end of the year. Were live from the New York Stock Exchange youre watching closing bell on cnbc. The Dow Jones Industrial average is down near 300 points. Back after this. I was born on the south side of chicago. It has been a long road, but now im working for schwab. I love to help people understand the world through their lens and invest accordingly. You can call us Christmas Eve at four oclock in the morning. Were gonna always make sure that you have all of the financial tools and support to secure your financial future. That means a lot for my community and for every community. This thing, its making me get an ice bath again. What do you mean . These straps are mindblowing they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. And you are . Im an investor. In invesco qqq, a fund that gives me access to. Nasdaq 100 innovations like. Wearable training optimization tech. Uh, how long are you. Im done. Im okay. All right. Were back stocks on track for their Third Straight day of losses 10year yield hitting the highest level since october of 2022 my next guest is seeing a light at the end of the tunnel calling for a new profits driven bull market over the next six months. Chris hyzy of Maryland Bank of america private back welcome back. You too as always. Wet a headline like that sounds like given our conversations i recall having youre more positive on the market than youve been at least in the last 12 months . Yeah. I think its important to put it into context, the positivity is coming, what is in store for the back half of 24 youve been covering this recently which is the market looks forward, 6, 9 months, sometimes a little bit longer than that. Next years story, dont want to get ahead of it here, but next years story a drop in yields. Cant see it right now, but with what were seeing in the slow Growth Trends theres strains out there, well covered, coming out of china for sure, and then in the united states, what wlaerp starting to see is a little bit of drag from the positive real yields which hasnt been discussed enough going from negative real yields to positive real yields with a wide gap negative leading indicators. A lot of things piling up right now where headline risk, you were talking about this before, is very high but if you go back to profits, we dont need a big expansion for profits to ultimately bottom out, most likely towards the end of this year and start to show the signs that were going to begin to recover august is an auburn month. Its leaving the brown days, the hot days of summer, going into the october leaf changing days of red put them together. Its an auburn type month. Structural factors, low volume. You suggest we should be buying stocks now. If we have the ability to look ahead 6 to 9 months and improving profits picture that today is the time to even take advantage of some of this, you know, unsettled nature of the market and put some money to work yeah. We all have been saying variety of Different Things as it relates to choppiness, edginess. Thats been the telltale sign. Every time something doesnt go your way in august, this pullback, seasonalbly, the case, we would use this as the first episode. We think theres going to be two more after august and into early part of september. One towards the end of this year and then in spring of next year. Once you hit the topping out of yields before the Federal Reserve starts to say wait a minute now, we might have to start to pivot, a little bit sooner than the market believes, so we think theres three episodes of weakness a lot of cash on the sidelines, certainly there is a Slower Growth environment coming you have to have plans ready right now. Most people are still under their benchmark in terms of their exposure to equities and if youre long term, just have to think about into later 24 into 25, and the market should start to adjust your way in a positive way dollar cost averaging starting now makes sense to us. You also made the case of, if i heard you correctly, there could be two more bouts of selling periods before the real opportunities present themselves in terms of the current one which we may be in to some degree, were down today and weve been down, you know, the last couple weeks have been unsettled, how much of a correction do you think were in store for now . , you know, typically when you get slow volume months like august, 3 to 5 makes sense to us i dont see any much more than that if it comes a little bit more than that, its a bigger opportunity. The big magnificent 7, if you want to call it the grade a, whatever it may be, theyve pushed the markets valuation up in our opinion justifiably so because if youre going to see Slower Growth, you do migrate towards those areas that are going to give you the growth the story early and late 22 was those magnificent seven areas, the big mega tech, were slowing down in the Revenue Growth and what they showed us was yes, they slowed down, but they didnt go down as much as expected this was a relative move now next year it should be an absolute move. From our perspective, everybody likes to wait. They want to catch a bottom. Market timing doesnt work its time in the market and rebalancing when the market activity gives you the opportunity to do it. Dont you think its going to be hard to convince people to get out of fixed income or a 5 money market and take what feels like a lot more risk in stocks it is hard. Its difficult until yields start to crest and start to come down, then you start to see that activity pick up and were suggesting extending duration right now with the understanding that theres a lot of treasury buyers throughout that dont want as much exposure as they did before to longer data treasuries. A drift in yields, worries about the deficit. When the slow growth activity starts to hit the yield curve begins to normalize. We have a ways to go before that certainly that shift from being defensive back into i wouldnt call it risk on, but more risky areas of the market, we expect that to happen over the next six months for those investors who have yet to do it. Chris, enjoy the rest of the summer and catch you soon. Chris hyzy, merrill, bank of america joining us. Searching for big opportunity, lux capitals josh wolfe breaking down where hes seeing strength and the boom in a. I. Is impacting his strategy later, energy its out performing today well drill down on whats behind the move. Crude and brent as well. Natural gas is the biggest winner today up 1 closing bell right back. Its time to bring balance to business travel. And discover the equilibrium that works for you. At national, youre in control. Skip the counter, choose any car in the aisle. And manage your rental right from the app. So you can mix work. With leisure. Or leisure. With work. Giving you the control to find the perfect balance. Go national. Go like a pro. You founded your Kayak Company because you love the ocean not spreadsheets. You need to hire. I need indeed. Indeed you do. Indeed instant match instantly delivers quality candidates matching your job description. Visit indeed. Com hire you cant buy great conversations or moments that matter, but you can invest in them. At t. Rowe price our strategic investing approach can help you build the future you imagine. T. Rowe price, invest with confidence. Welcome back to closing bell. Cvs one of the biggest s p laggards today after reports that blue shield of california will partner with amazon and mark cubans cost plus drugs for its Pharmacy Network is this the Tipping Point for the Health Care Sector Morgan Brennan joins us live in the hamptons with josh wolfe, cofounder and managing partner of lux capital, science and Technology Focused vc firm. Scott, thank you. We can call this cnbc out east and josh, its great to be sitting here talking to you. Thanks for joining me. I do want to start there weve had conversations about health care in the past. Big news, cvs stock falling. Tech disruption. Weve been talking about it coming to health care for some time is this moment a Tipping Point you know, theres something i think people are not talking about that makes it a Tipping Point and that actually has to do with labors and union not just technology. If you permit me, i think that weve seen record low participation of people in unions you have record high support of people wanting to support unions biden is very pro labor. Youre seeing not just a heat wave this summer, but a strike wave we basically averted 350,000 or so ups workers which would have been like a cardiac arrest for the circulatory commerce of the country. This could have been terrible. If unions win, they get higher wages and Health Care Benefits i think theres an unappreciated tailwind for services. May ven clinic and public companies, the indexes, something i would be looking at. If labor wins Health Care Services will win, fertility services, virtual doctors on demand, local pharmacies interesting so you mentioned some of your Current Investments in your portfolio. Are you making more . We are. Youve had my partner dina on. Been a magnet for great presence every facet from fertility on demand clinics, people doing mental health, the Backend Software providers for amazon that are providing some of the services, it really is going to be a tailwind i think across sector, particularly domestic u. S. Yeah. I want to shift gears a little bit here the last time you and i spoke, one of the biggest opportunities for a. I. Is in biotech as well i want to dig into that more and just at a time where weve seen all of these stocks that have a. I. Applications or working on a. I. Investment in the public markets, run up pretty ferociously since the beginning of the year, have we gotten ahead of ourselves hype is shown in the markets when things run up and people sort of underestimate things in the long term and overestimate them in the short term the first thing one was a hardware nvidia is still vulnerable programming language called cuda that has dominated amd waiting in the wait. Other languages like pie torch and try tant something openai is working upon something i would watch in terms of the dominance of what people perceive to be a monopoly once you get all the chips being banned in china and really sought after very aggressively here in the u. S. , the first beneficiaries of this has been the openai, developing Foundation Model for text and images Companies Like ours hugging face the repository for the a. I. Models and runway, letting you text a prompt and create a full movie. The next wave as you noted is going to be in biology requiring a sew fes fist cated level of understanding. Now you have these context windows which anthropic was the first to expand, hundreds of thousands of tokens inside, you can put an entire genome in. If you can put a genome into a. I. , you can do protein structure prediction and there are groups doing just this its one of the themes i think is going to be a big over the next two years for venture groups out of big tech one of the groups we took out which we havent announced is a group that predicted the approaching structures from gene sequences better than deep mind. A new startup its going to mean not only able to predict protein structures to design drugs, ultimately developing synthetic life from Software Code to develop cells to produce things like insulin and drugs that will help humanity. My head is exploding a little bit with this concept as i wrap my mind around it. I guess just to dig into that a little bit further, though, as you mentioned some of this is coming out of the larger companies, i mean, how much opportunity is there in terms of a. I. Investment, particularly in the private markets if theres so much money that needs to go into it, the big cap tech names on the forefront a lot looked at this theres not like a law the cost of these fabs to make the chips get more expensive in a. I. Used to cost 10 million and then 100 million and now people think it will be a billion. Openai and anthropic and companies have raised hundreds of millions if not billions of dollars to buy the compute making this gold rush for nvidia chips. We had a different thesis. We think theres going to be distributed compute architecture, instead of relying on these a 100 chips from nvidia, youre going to be able to leverage lots of compute. We have a Company Called together compute doing this. Train models for a fraction of the cost, time, and doing it open source with distributed compute. Necessity is the mother of invention and the necessity now is we cant get ahold of these chips so people will invent new architects and flip on its head only the Biggest Companies with bills can do this stuff. Interesting look forward to see how this evolves. Thanks for joining me in the hamptons back over to you. Thank you very much morgan and josh. As you know, well have more big guests next hour in o. T. Including wes edens. His take on the markets. Were track the biggest movers as we head into what might be a bit of an unsettled close, shall we say Kristina Partsinevelos. More unsettled. There werent enough nhl hockey games this year hurting shares of one firm. We could also blame the knicks ill explain next. Mlb chooses tmobile for business for 5g solutions. To not only enhance the fan experience, but to advance how the game is played. Nows the time to see what americas largest 5g network can do for your business. We never just see the numbers. We see the people. Marcus detroit, its just changed so much. You can see what it once was. And then, i think about what it can be. As an entrepreneur, its about how i can give them the tools to empower themselves if we can just all do something small, all the small things will start to amount to something big. Thats why were here to help make it happen. Working on 15 minutes to go before the closing bell rings. Kristina partsinevelos has her eye on the key stocks that we need to look at heading into the close. Well, cost rising at a faster pace than sales, why wolfspeed is plunging 17 . The Company Posted a bigger than expected loss and quarterly revenue below estimates. Wolfspeed executive cited, quote, significant cost related to construction of new facilities in North Carolina as well as new york, expansion as well, and neither of those facilities have started generating revenue. Blame the knicks much to scotts dismay and the rangers for Madison Square garden sports Fourth Quarter revenue decline up 28 even it was a beat the company said the drop was caused by the timing of the nhl regular season and fewer playoff home games shares of msgs, not msge, are down 9. 5 . Scott. The knickss on the up and up. All right. Okay. Ill nod as if i follow. The knicks are on the up. Got it. All right. Thank you Kristina Partsinevelos last chance to weigh in on our question of the day. Do you think apple will trade into the 150s . You can head to cnbc closing bell on x. Well bring you the results next you got this. Lets go. Gobble gobble. Ive seen bigger legs on a turkey rude. Who are you . Im an investor in a fund that helps advance innovative sports tech like this Smart Fitness mirror. Im also mr. Leg day. 1989 anyone can become an agent of innovation with invesco qqq, a fund that gives you access to nasdaq100 innovations. I go through a lot of pants. Before investing carefully read and consider Fund Investment objectives, risks, charges, expenses and more in prospectus at invesco. Com. The citi custom cash℠ card automatically adjusts to earn you more cash back in your top eligible spend category. Hi. You dont have to keep tabs on rotating categories. This is the only rotating i care about. Or activate anything to earn. Your cash back automatically adjusts for you. Can i get a cucumber water . Earn 5 cash back that automatically adjusts to your top eligible spend category, up to 500 spent each billing cycle with the citi custom cash℠ card. I love it. [voice vibrating] the results of our question of the day, we said, do you think apple will trade into the 150s now this is pretty telling to me the results are split. I figured you guys would say no way. But 50 of you say almost say yeah, it could very interesting up next, Applied Materials reporting in just a few minutes. We have a rundown of what to look for when those results hit e tape were going to take you inside the market zone next your shipping manager left to find themself. leaving you lost. You need to hire. I need indeed. Indeed you do. Indeed instant match instantly delivers quality candidates matching your job description. Visit indeed. Com hire power e trades awardwinning trading app makes trading easier. With its customizable options chain, easytouse tools and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are. E trade from morgan stanley. Power e trades easytouse tools make complex trading less complicated. Custom scans help you find new trading opportunities, while an earnings tool helps you plan your trades and stay on top of the market. E trade from morgan stanley. All right. Were in the closing bell market zone. Senior commentator mike santoli here to break down the crucial moments of the day, Pippa Stevens digging into todays energy rally, Kristina Partsinevelos back to look at Applied Materials the earnings out in o. T. And options play Jessica Inskip telling us the key market levels we need to watch. Michael, a lot like yesterday. Volume 400 million number, getting a little bit uglier as we head towards the close. Yeah. Look, i wouldnt really hinge too much on it being relatively quiet. Yes, it has been fairly orderly as you were saying before, but youre starting to deepen a little bit the down trend has taken a sharper turn lower you got rid of the final thrust higher in july and what were waiting for now, tactically, as ive been saying for a couple days, for it to get a little bit more over sold and stretched and having enough of a broader wash out type feel to it, were not really there i think by the time we get tomorrows kind of post mortem on today, people say yes, some of the conditions are lining up for tactical lows. Yields are still over everybodys shoulder and the confusion is, a reacceleration in a late cycleconomy, yields going higher without reprising the fed, seems like yields are trying to restrain demand in the short term we dont know what economic implications are going to be. All of this happening a week ahead of jackson hole. It just makes the build up and the black drop all the more important. It does i think we have the dynamic where were grabbing for things and seeing gueshosts in every direction because the Market Action has been treacherous, at least in the last while. I do agree that stakes are rising, but i dont necessarily know that everyone has a clear idea of what they want to hear out of jackson hole. They know its something hovering on the horizon. A good point you make well talk in a bit. Pippa stevens, energy. Energy is the only sector in the green because oil is higher, making back some of the losses from the last three days, as focus is shifting to falling u. S. Inventories rather than weak Economic Data out of china. So that is supporting Energy Stocks, which once again, only s p group higher the players which are the most correlated with Commodity Prices are the outperformers. Refiners in the green. We are seeing modest weakness in the Oil Field Services names with baker hughes and halliburton in the red the oih has led in months due to optimism around a ramp up in international and offshore one area to watch is the midstream names activity there is heating up with Energy Transfers saying it will buy Crestwood Equity partners for 7. 1 billion. A lot of hurdles around building new pipelines and infrastructure that is already in place, looking increasingly valuable. Pippa stevens, thank you very much Kristina Partsinevelos, down 5 , thereabouts, heading into the number. Well, it beats lam research and kla is whats to come, Applied Materials should post better than expected results after the bell this is a breakdown, leading edge powers super computers, while lagging ones are used to make up the bulk of other components like electric vehicles and hvac systems. Applied materials is highly exposed to the lagging notes and there is massive demand still coming from china. Applied materials also has some exposure to a. I. Its machines help with advanced packaging and high bandwidth memory used on the leading edge a. I. Chips could be seen as a boon for guidance. But mizuho suggested a cyclical slowdown coming in the September Quarter is because why investors should put Applied Materials with lam research as well as kla in the camp of waiting to add on further stock price pullback scott . Yep looking at it down 5 or so over the last month heading in. Thank you. Well see you afterwards with exactly what they delivered. Jessica inskip, by the way, mike santoli, see you at the top of overtime. Thank you as well. Jessica, inskip, now to you, the levels, what are we watching and need to Pay Attention to were definitely jogging in place. We have the bearish seasonal overhang in full swing were getting to the bottom of those trading ranges nasdaq 100 is the line leader that leads the rallies, lead the declines their next support level is around 13,950. Now, nasdaq 100 has already broken its 13 weekly moving average. Thats extremely important because that represents one quarter of prices. Were above one, two, and three quarters we close the week below the 13 week i will raise a flag and something to be of concern thats 14, 300 the april gap i want to Pay Attention to. You think weve seen a decided trend change can we make that call yet in tech i do not think so absolutely not i think if we look at the broader picture as in lets talk about how theres gdp growth and there is such a slow down in the labor market, the productivity that we see there, is the health, the pulse of that, and that is all with technology and a. I. And that boom thats necessary that will translate to earnings. Thats going to take some time we just are very over sold at the moment there has to be a rotation there needs to be broadening out. Well get to the bottom of the trading range. Greabupportunity and well go back up, perhaps consolidate, but thats going to translate definitely broader bull i am definitely a bull in the longer term. Consolidation in the shortterm. Apple is an important one to watch talking about consolidation. I thought our poll was very telling with half of those who voted suggesting yes, stocks going lower. We asked could it go to 150. You know, comment on apple as i look at it down another 1. 3 how important you see it right here, where you think it may going from here . Its very interesting 173. 26 is apples 26 weekly moving average the two quarter price. That i want to see close above 173. 26, which is were hovering at right now that could be the area of support sending it rebounding from a technical perspective this is the testing moment right now. Thats why i love you technicians. You get right to the specific, down to the penny. Jessica, thank you appreciate that very much. Thats Jessica Inskip. You hear them cheering, but for the second day in a roeshgs the cheers dont match the action because the dow will close not at its lows, but not that far off either things certainly deteriorated over the final hour of trades. Ill see you tomorrow. Send it into overtime with Morgan Brennan and mike santoli. Well, another ugly finish as stocks add to their august losses and the s p closes below 4400 the action just Getting Started. Welcome to a special edition of closing bell overtime. Im Morgan Brennan and joining you today from sag harbor in the hamptons. Im mike santoli in for jon fortt at the New York Stock Exchange coming up in just moments, well get Earnings Results from 115 billion market cap equipment maker Applied Materials along with discount retailer ross stores