Small caps didnt do anything to begin the year but slowly starting to perk colate up. Our talk of the tape. You have the fed decision on wednesday. You have a very busy earnings season can anything should all the bears, if theres any left, should they go in to hibernation . Lets ask anastasia amoroso, icaps manager. Good to see you dow 11 days whats happened . I dont understand what changed from two weeks ago thats the point. The technical point is still constructive for stocks meaning if we stay around these levels well continue to trade above moving averages and all the key cta commodity adviser thresholds, so theres no reason to sell. Theres been a catalyst to sell. When i think about this week, you know, we go into just a monster week for Central Banks we have the fed, the doj, we have the ecb if the fed does deliver the last rate hike, thats the thing for stocks if big tech earnings deliver this week, thats again supportive for whats been driving this market all year long in this case, not much as changed and its a good thing. Theres a lot to unpack lets go back to your first point, technicals and the ctas people are vaguely familiar with ctas explain who they are and why they matter so much particularly for shortterm momentum. Commodity trading advisers invest based on thresholds and chase trends when the trend is positive, theres no reason to sell so they stick with it if you think about them in particular, they were sort of the first part of the market that catalyzed this rally, you know, back in even before april. The within was they are not very long stocks at all, but they were adding length, adding incremental data, exposure to the market as they did that, that kind of took us higher as long as they keep that and dont sell, thats not an incremental sell to the market and thats good. You cant solely rely on that one player in the market, but its hedge funds, retail investors. I would tell you that everybody is sort of in this chasing mode. The animal spirits are back. The retail trader is back. Back to sort of the 2020 levels, not quite there, but theres exuberance we talk about hawks and doves, talk about ctas i know a few of them they have the Attention Span of another bird, a pigeon, meaning they will turn quickly right now theyre all buying stocks every day because these Technical Levels do you anticipate these levels will break through resistance or whatever it might be the shortterm momentum to continue but when it does turn, could they have the opposite effect . 100 . Absolutely for now, as long as we hold above these key critical levels, there wont be a Huge Movement but there is a catalyst that requires a sell, then you could have some significant selling pressure come from this particular pocket of the market. How important is the Federal Reserve decision on wednesday . Its important, but i dont know that were going to get any big, you know, surprises from that i think the fed is going to deliver the rate hikebecause they sort of said they would, and, you know, then theyll probably deliver a hold because they also have the sort of propensity to want to do that right now because of how much they hiked in a short period of time so i dont think were going to the hear that much new information. Youre supposed to ramp up the adrenaline and excitement. This is cnbc its going to be the most important fed meeting ever one thing fed chair powell may say is throwing back to the hawks, he may try to sound hawkish and say no cuts on the horizon, maybe there will be more hikes because he doesnt want the markets to price in rate cuts. For that reason, he may sound more hawkish at that point where the rate hike was mentioned a potential surprise is bank of japan nobodys talking about it, but the yield curve control is still there, 0. 5 , but by the way, inflation in japan is 3. 3 , well above target its been there for over a year. To the extent that bank of japan surprises us to any extent with potentially widening the ban, that could have an effect on u. S. Treasuries. Lauren goodwin of new York Life Investments and shannon, a cnbc contributor lauren, youve been listening. Anything you agree with, disagree with . What is your take for clients right now . In our world, everybody is paying attention to the bank of japan not only for Monetary Policy we need to hang out with different people but u. S. Loan rates. We had our midyear investor investor roundtable where we look at whats happening and agrees and disagrees the number one risk was not recession but u. S. Loan rates changing factors the bank of japan would have meaningful influence over it the reason is that over the past several years long rates outside of the u. S. Have been negative many countries, which improves demand for u. S. Loan rates thats no longer the case in many countries the europe and germany most famously and may not be the case anymore in japan soon. If Interest Rates were moving significantly higher because of a changing investment environment in the u. S. , then rates can stay higher sustainably. If theyre moving higher because of a strong falloff in demand, thats a more risky, more volatile situation shannon, i hear that and we can dive into bank of japan if we want, but im looking at a nasdaq qqq up 41 this year. Globally, brazil, up 23 the nikkei up as well. Mexico is outperforming the united states, at least the s p. Its up 25 or so. This is like global stock market inflation. How much longer can it last . We have a significant amount of matchup that remains in the strong end of the curve. One of the things that investors were anticipating as we came into this year was there would be a reassessment of risk. If we saw movement out of cash and shortterm bonds, those would likely be balanced between equities and perhaps longer duration fixed income. Theres a lot of firms including ours that are talking about potentially eleventhening in duration to lock in longer deals. But investors, whether youre talking retail or institutional investors, as well as what i would say are shortterm traders, have really piled back into equities on the other side of this. I think one of the challenges right now from an investment perspective is just what you talked about in terms of the rapidity of the moves weve experienced this year. And coming on the back of continued margin compression there are a number of sectors and industries as well as geographically Global Markets that are very stretched from a valuation perspective. What is the catalyst for that valuation to be realized do we anticipate that weve already experienced an earnings trough or is there more pain yet to come many the second half of the year i think thats why youre seeing such a wide disparity between strategists expectations for the second half of the year, because it really hinges on the multiple expansion weve experienced being justified. I think this week will be pivotal trying to determine that to shannons point, i would argue the multiple expansion has been justified because we have managed to avert a recession so far in 2023, whereas everybody was talking about a hard landing versus soft landing. And now people are saying soft or no landing. Maybe thats the right conversation to bring back up. Over the weekend, i noticed were talking about growth reacceleration and what that might look like later this year or 2024. To shannons point, consensus and earnings estimates for 2023 and 2024, theyre starting to see upwards earnings revisions that also kind of brings me back to some of the Technology Names that are going to report this week and, you know, yes, tech valuations may have gotten extended, but when you look at it in terms of pricetoearnings and growth and when you account for what is going to be a multiyear Artificial Intelligence growth story, those tech stocks are not trading expensively. I like that. Something i add to this dynamic is one of the reasons why we have seen multiple expansion for the last nine months is because financial conditions have improved over the last nine months despite the fed hiking monetary conditions, financial conditions the way they work their way through the market, have actually been easing and the equity market what does that mean it means that Market Conditions and the rate at which companies are the motor oil of the stock market the regulators are having to absorb the higher costs has not been as profound its one of the main reasons that bolsters the nolanding case, the idea that monetary conditions arent tight enough yet to slow the economy. The challenge i have with that story, at least in terms of a mediumterm optimism for investors, is that if thats the case, then inflation is going to remain sticky and the fed will be more assertive. Thats an environment where, in the next six, nine months, you may have a more challenging environment for equity markets than if we saw the Economic Activity slow down if you dont have to live anywhere, eat, or drive anywhere, inflation is great my point there is not to be cynical. Its i dont know what the Federal Reserve can do about housing costs. Theyre raising rates. But so far, no real debt in housing, at least not in some markets. Im sure there are some until the country as well. Energy costs kind of come back, but theyre still higher than they were a couple years ago i just dont know when do we stop with the inflation conversation or do we never stop talking about it well, i think that we probably dont stop talking about it at least for the next several years, brian, because were facing some demographic challenges in terms of the labor market, the fact we had this explosion of liquidity that benefited consumer balance sheets, although we started to see the Savings Rates coming down were seeing that rebound over the last couple months that margin of safety that everyone was talking about that would start to deteriorate for the u. S. Contisumer has come to fruition we are seeing economic deterioration. I want to point that out with the talk about the landing, theres a lot of leading indicators in the u. S. Economy that point towards a continued slowdown or contraction. For us, i think what were watching in terms of that Inflection Point of whether were coming out of the other side is the pace of economic deterioration. When that starts to stabilize, youre right, youll see investors increasing their risk positions, allocating to equity. I think the last thing i would point out is that were talking a lot about the markets that have done well in the first half of this year a lot of that has been on a weaker dollar scenario going back to the initial question in terms of whos looking at currency markets, i think we all should be that weaker dollar scenario has longer life to it if that continues. I guess and anastasia and lauren, same question to both of you, which are earnings are key, and i get it we know its like seven stocks have been driving the s p 500. I dont know if any of those seven stocks cares what the u. S. Consumer does microsoft care about the consumer does apple maybe with iphones . Nvidia probably doesnt. Does google maybe with advertising . I dont know if those companies have any connection anymore to the macro u. S. Economy i dont know i think they do, brian. You mentioned the social media companies. You know, a lot of the analysts notes over the weekend going into the earnings for meta and snapchat and others, theres positive sentiment there the reason is as long as the u. S. Consumer is on solid footing, Consumer Confidence is rising snapchat is not moving the overall market. True, but meta does the fact that the consumer is strong and the Online Advertising market is picking up, and by the way the estimates for Digital Online benefits upgraded to 9. 7 versus 7 year over year a bit ago, that follows through and thats beneficial for social media companies. Then youre right, though, brian, if you talk about the microsofts of the world, yes, theres a consumer component, but theres an enterprise spend component. Its all one and the same. Consumers are strong everybody is still on one side but marco from jpmorgan saying hes reiterating negative bias lauren, its been positive so far. What if microsoft misses what if the guidance isnt good . It feels like the market could be at a vulnerable moment. Two really important things with respect to market vulnerability. First, i agree with your point one of the most common myths in the market is that the market tends to foresee or price in recession before it happens. That tends to communicate on the way out of recession, but heading into recession, until you see unemployment claims rising and earnings falling off, the market doesnt reflect that economic risk. So there is a risk to the market theres been a risk to the market this is where perhaps anastasia and i overlap a bit, while i have a more concerned economic outlook, were holding by the skin of our teeth you were pretty sure. Thats kind of your vibe Insurance Companies your job is to worry about 3 outcomes. Exactly what if it gets killed by a hay beale . You have to worry. From an investment perspective, what were seeing is that eechb as though people have pushed their recession time line out further, i would argue a durable decrease in inflation has been improving investor sentiment. Even if you expect a recession, as i do, at the end of the year, thats in some ways optimistic because its a mild recession. There have been changes in the last couple years, higher quality, higher yield asset class, huge investments in infrastructureleveraging no landing, great for markets, bad for flying. Shannon, before we go, youre in boston or massachusetts, right correct so i got to i heard about some guy i know ordered clam chowder to start the meal and then got a chili as his entree is that acceptable its completely acceptable. Clam chowder is an appetizer anytime here in boston but chili as the entree can you go from i dont know. What doesnt seem good. Its surf and turf. Surf and turf, brian i guess, yeah, the turf there you go thank you very much. I just folks, that should be our twitter poll. Is it okay to eat a bowl of chili if you have clam chowder as your appetizer . I want to hear from you. Heres the official question of the day. We want to know, will tech earnings derail the tech rally you can head to cnbcclosingbell on twitter or x or whatever its called. Well share later in the hour. Kristina partsinevelos is here with stocks before the close. No clam chowder but chinese tech stocks rebounding today amid optimism chinas government might be slowing down on its crackdown on the sector here are the names in positive territory. The etf heads for its best day since only midmay spotify is lower as the company hikes its prices of the premium subscriptions by one or two dollars a month depending on your plan. It comes ahead of their Earnings Report tomorrow morning. Shares having their worst day since december, down over 5 brian . Thank you very much were just Getting Started on closing bell. Up next, the big return of ipos. Your next guest is forecasting a comeback in the space. What that might mean nor the for the Broader Market ah, these bills are crazy. She has no idea shes sitting on a goldmine. Well she doesnt know that if she owns a Life Insurance policy of 100,000 or more she can sell all or part of it to coventry for cash. Even a term policy. Even a term policy . Even a term policy find out if youre sitting on a goldmine. Call Coventry Direct today at the number on your screen, or visit coventrydirect. Com. All right. Welcome back to closing bell. So far this year has been a relatively tough year for Investment Banking if you can have a tough year, with a sharp decline in deal making and a largely frozen ipo pipeline. Your next guest says there has been an uptick in the Second Quarter that could signal improving strength for the back half of the year the chairman oe chairman of the Institutional Clients Group at citi joins what are some of these positive rumblings under the market hood . Nice to see you too its early days. The positive rumblings are youre seeing some ipos getting done we saw a very good one for a few, way oversubscribed, good investor demand. I think the reality is the investors are coming back, but the issuers are not yet really fully decided to test the water. So the ipo market is still very, very dormant most of them have been Corporate Partners there will be more separation activity but what youre not seeing is what i would call is highgrowth multiples of revenue, no earnings ipo that the mediterranean chipotle or whatever, that did pretty well it did very well. Kava there was a recent one last week that did well. These are early, early signs from an ipo standpoint, but its not yet turned into a flood. I think its going to take a while. Are there Good Companies waiting to go . There are a number of companies waiting on the sidelines. What they want is to ensure they have good investor demand and reasonable valuation i think what people are looking at is trying to get to valuations that are going to get great investor demand but also as you know, brian, the class of 20 and 21, part of 22 was not a barn burner for ipos they traded down dramatically. I think people want to ensure good afterMarket Performance and ensure their Investor Base is reasonably awarded and also their employees. Employees have been waiting a long time for liquidity. Does the ipo market matter for the overall stock Market Performance . If so, how much . I think it matters somewhat now. Were look today at markets that are getting close to their peak, so looking this morning, going back on historical numbers, the market has come back dramatically the nasdaq largely being driven by seven stocks. Youve seen that i think the ipo market is one piece of it. It shows people are willing to take on new issues its not the overall market, only one component, the other being m a, starting to come back what do you mean the mark