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tv   Closing Bell  CNBC  December 20, 2021 3:00pm-5:00pm EST

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for "spiderman." that was for friday. much sunday was amazing. the best ever for the month of december the spiderman franchise is now for sony pictures $600 million globally so far. and we're saying shares of amc are even adding about 2% today they're up 27% in the past week. >> all right folks, thank you for watching "closing bell. nice to have you back. >> "closing bell" starts right now. >> thanks for doing that too >> thanks for doing that, especially from us welcome, everyone, to "closing bell" h omicron cases are surging and stocks are falling we're off the lows at this point. starting the week off with another ugly day in the market >> yeah, sarah i'm mike santoli let's look what the is driving the action growth concerns weighing on investors. covid-19 cases spike and the fed seems to beintent on tightenin still. staup staples are holding up the best.
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that is the worst performer. >> big show coming your way. charles schwab is here to react to today's selloff and what investors should be doing right now. plus, the ceo of novavax joins us as the european commission grants the company authorization for the covid-19 vaccine today arnold donald weighs in on how the omicron variant is impacting his business and what we're seeing with cruises right now. but first, to the big stories we're watching at this hour. mike tracking the broader market meg terrell with the omicron surge and steve liesman. what you are focused on? >> no bigamistry in terms of the key drivers, sarah obviously this continued surge we're seeing is creating another layer of growth waries on top of what we tried todigest last week with the fed intent a bit of this on going loss of faith in mega cap tech to try to support the market through these periods. however, we did find a little
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bit of traction intraday, around 11:30. the time the european markets closed there is a little bit of firming up of the general take here. what is happening in the context of the market sort of attempting to maybe find a little bit of a low here, where it has before in this trading range we've been in for a couple months, also the september 2nd high frustrating as it's been the last few months. it seems as if so far we don't remain too far off the highs even though the average stock is really underperformed. treasury yields also up off the lows speaking of nat being too far off the highs, take a look at this 5% pullback that is not even where we are right now. we've had about a 5% max drawdown this year this goes back showing the percentage off of the high, the s&p 500 has been back to 2009. really this is about as minimal as it gets on a one year basis i do want to focus on other
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decembers where the market was weak and did it not conform to the usual strength that is 2015 we saw this big drop right here going into 2016, of course i'm sorry. and then 2018. that was even deeper st what was going on then, of course, also growth scare, also tightening moves by the moves overdone the fed pushed through the first-rate hike of that cycle. come ago long with slowdown fears. but here's what else is going on look what the credit markets were doing in both the periods much more stress evident then than there is right now. the spike into the end of 2020. we're still in the normal pullback zone for equities >> what's getting hit the hardest? the cyclicals, industrials, financials, materials. technology is in there too it's not necessarily the pandemic playbook.
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it does have the makings of a growth scare right? with u.s. growth look at crude oil, for instance, getting whacked. >> there is no doubt about it. this is a get away from cyclicals and benefiting more traditional defensives right? true defensive quality as opposed to the kind of growth quality which was represented in things like, you know, the big nasdaq stocks. again, we don't know if this is a real tidal shift or just the way the market is trying to go towards more neglected areas that have not been built up this year as a little bit of shelter in this little volatility storm. >> as we mentioned, the omicron variant putting a lot of pressure on the market today meg terrell has the latest on the case count and how we're fighting it. >> yeah. sarah, cases are surging we're up now to more than 130,000 per day. hospitalizations also on the rise, about 70,000 people currently hospitalized deaths also increasing now
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approaching 1300 per day we're mainly seeing the highest transmission rates in the northeast and the midwest. and in terms of the split, between delta and omicron, it's a mivenlxture of both at this p. we expect to see data from the cdc tomorrow as of last week it was only 3% omicron. but 13% in the new york/new jersey area. we heard from a couple places over the weekend, houston methodist and 82% of the new case thez sequence ready omicron, connecticut was look being at 40% prevalence on friday with the expectation it would cross over 50% this is really important because some of the antibody drugs don't work against omicron they're giving out new guidance for how to use these, specifically the technology antibody drug to use that in the highest risk patients because there is limited supply. either when can you determine they have omicron or in places with 20% prevalence.
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they're expected to hold up against all variants including omicron. really waiting to see the f.d.a.'s decision on those >> let's ask about the pfizer pill if it is expected to hold up against omicron, that appears to be the best treatment here when does fda have the emergenc meeting and how much of that pill is manufactured so that people can start using it? >> we expect by the end of the year pfizer said they could make like 180,000 courses that is going to get up to 80 million about it end of in e year the u.s. is purchased $10 million. we'll have to see what the cadence of that becoming available looks like its no the clear the fda is going to hold an advisory committee meeting for this medicine we expect they would have scheduled it already if they planned to and with that update last week with the final data showing 89%
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prevention of hospitalization and deaths, that seemed to be what the fda is looking for. to feel comfortable potentially clearing this. so we're really waiting on that any day now. >> meg, thank you very much. >> the end of president biden's build back better agenda is leaving the economic agenda cloudy steve liesman is trying to sort out the effect some people say maybe a version of this goes forward right now what does it mean for the economy? >> well, it's just one piece of it, mike the economic outlook and the right policy response from the fed all complicated by first you have another fast spreading virus waiting here the failure of build back better and all amid still high inflation. so here's the challenges the new virus spread threatens demand and supply. so that's inflation issue on the supply side. and obviously deplace around the demand side. goldman sachs cutting the forecast with the failure of build back better, the apparent failure and central banks pivoting to fighting inflation
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we already expected a negative fiscal impulse for 2022 as we go to the fading support of the covid-19 relief legislation. without bbb enactment, this impulse will welbecome more negative here's the fiscal impact measure forecast a 3% drag from the rolloff the relief next year and it was not counting on the build back better bill some forecasterscy think there additional spending that could come from supporting the child tax credit so less fiscal spending now. combined with some economic drag from the virus hits high inflation and bottle necks it doesn't set up for an easy set of policy choices from the federal reserve. sarah? >> when does the child tax credit sneend? >> i think it is supposed to roll off in january, if i'm not mistaken yeah, it was $15 billion and someone was explaining to me, kint remember the other number, several percentagepoints
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annualized at an annualized basis. it was going to be a pretty big hit to consumer incomes over -- if you laid it out over the whole year come in january it was going to hit. >> steve, thank you. steve liesman. straight ahead on the show, novavax gets the green light from the european union to move forward with the covid vaccine next, we'll talk to the company's ceo about that and when we can see approvals in the u.s. we're off the lows still brutal day for bulls. dow down 550 1.5% we'll be right back.
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. the dow jones industrial average down 500 points now. take a look at the heat map. the component and the defensive names holding up better. >> yeah. p & g near that high actually. big news out of novavax. granting authorization for the covid-19 vaccine the eu said the vaccine has 90% efficacy the trials were done when the alpha and beta variants were circulating. the company does expect to submit data to the u.s. fda by the end of this year joining us now in in a first on cnbc interview with novavax ceo. congratulations on the milestone.
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i know it's been a long time coming that's my question which is why did it take so long? you've been out with the data for a long time. >> it's taking time because it's taking time to get the manufacturing scale up and processes and analytics in place that you have to do. there is a process with zero capacity and we built it up over a long time. this has been a great day for us it's the globally the recollect torre process has come together. on friday, i think we announced that the w.h.o. had given us emergency use and today with the europe coming in, i think that's just great we're looking for more to come. >> that is the question on manufacturing. and i know that has been a big holdup for you so can you reliably deliver the significant amounts of doses for these countries that are now
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starting to approve your vaccine? and what do the numbers look like >> well, we can. and that's why we've gotten these authorizations and listings is because they've been pouring over all of our data that we've been sending to them. and we're at the scale now and the first quarter we'll be in scale where we can produce over two billion doses in 2022 on the global basis >> you already have, you know, multiple billions of doses glaeb globally where do you see yours fitting into this mix? we know the performance and side effect profiles are already in the market can yours be used potentially as a booster to others? how does it -- how do you see it place among the others >> i think the answer is yes to all your questions we can use it as a booster to people who have gotten other doses in the past year or so a couple unique features
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one is that our products is very stable and so we can ship our product refridge freighted temperatures and start at room temperatures for a number of hours. the product is very stable we can get it across the globe much more easily than can you with other vaccines. we've got good booster data. we have good data on efficacy and safety and so we're looking forward to getting the vaccine out to many places a lot of different uses for the vaccine right now. >> any data, stan, on the vaccines efficacy against delta and omicron? >> we do in fact, so we had our -- we did our phase three efficacy trials unlike other folks we did it when there were booster -- when there were variants in the marketplace, alpha and beta. we showed the vaccine worked very well against those. we also have data against delta showing that we have very
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broadly neutralizing responds to the delta variant. i expect within the next very short period of time we'll have data against the omicron that we'll be able to talk about shortly. >> stan, is this going to be fully reactive from here i just wonder if there is a way for a company like yours on a research basis to be pro active and trying to handicap where things move next in terms of variants or just patient need? >> that's a great question of course, we are. we've actually now made the variant and we're going to be testing it in animals and very shortly and we'll get it up in humans we're starting to make it in such a way that we can scale it to process its not going to take very long to do that because the process we expect is going to be the same as we're already using. so there is no changes to the manufacturing sites to get variants made. the what we don't know and we'll
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start to know soon but we don't know whether we actually need to make it strain change to the vaccine like we do with flu every year or whether we can use the -- what's known as the wuhan strain and that will depend on the data that i mentioned to you just a lull while ago the data that shows what kind of broadly neutralizing anti-bodies we have against omicron. but we're also being pro active not only with omicron, but we have a flu vaccine that we're in clinical trials with with the combination flu and covid-19 and so those are the types of thing wez can do to anticipate future strain changes or variants that come about in either flu or covid-19 >> your stock has been a bit of a roller coster, stan. it's up shartly the last year. down today on this positive news what do you tell investors who have been here and hopeful for the ride i saw your efficacy data and
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then saw the stumble that's came along with that like the manufacturing hiccups and wondering if you are going to be a real player in this vaccine game in the coming years >> i think that my earlier statements that we not only have great efficacy and safety data but we also have now the manufacturing capacity to make a couple billion doses a year is -- should answer resolve that issue. i think that the roller coaster, we got -- there are investors and then there are gamblers. and those who are betting on short term movements do their thing. for the long term investor, we're -- we've created value of having a great vaccine that i think will be important in the marketplace for a long time to come >> stan, thank you very much for the update today appreciate it. >> thank you >> we have a little over 40
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minutes before the bell. the dow is still down a little over 500 points. s&p 500 down 1.25% up a little more than .5% from the morning lows shares of caterpillar dropping sharply. it's one of the biggest losers in the dow we'll look at what is pressuring the industrial sector next as we thoed a break, check out today's top surf tickers on the ten-year yield once again takes the top spot followed by tes l.a. the dow itself, moderna and apple. ok, let's talk about those changes to your financial plan. bill, mary? hey... it's our former broker carl. carl, say hi to nina, our schwab financial consultant. hm... i know how difficult these calls can be. not with schwab. nina made it easier to set up our financial plan.
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the industrial sector under a lot of pressure today. we have a look at the biggest decliners. sema >> hey, mike larger economically industrials like caterpillar and john deere as well as cummins are down 3% to 4% as industrial investors weigh the impact of omicron on inflation and the pricing of goods. ubs telling me in thiese
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situations, there are lower unit sales volumes relative to what might have been expected previously shares of general electric also in focus trading down following the delay of president biden's build back better plan which does include credits for wind turbines what is encouraging is even after the last covid-19 wave, the ism nmanufacturing data hel above 55% for the past 16 months that is seen as an encouraging sign for this broad seshgtor mike and sarah, back to you. >> yeah. you know, it comes at a time when as, you know, anl alysts sy they see the makings of a pretty decent, you know, cap-ex boom or up cycle in corporate america. it depends on how other parts of the world manage to do through this wave. >> yeah. one thing to watch there, mike,
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would be john deere and the latest earnings report that the company talked about how it's increasing the research and development expenses by around 17%. that really has to do with the broader trend of auto nation investi investing in robot uks it is part of this increase in capital that many of these companies are deploying because of the growth they are expecting next year into 2022. of course, now questions being raised around what omicron needs for those projections. >> thank you industrials, materials, financ financial, bottom three. >> still to come, how investors should be navigating the volatile markets later, we're counting down to earnings from micron and nike. we'll preview the key things to watch. quick break and check on bonds basically it's been a dash towards safe haven trades like
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u.s. government bonds. ten-year yield slightly higher right now. 1:42 but the trend has been pretty much weaker. 134 is the december closing low. the number to watch. we'll be right back. earn about ,
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or live chat at today. another big selloff on wall street down 500 points. a big decliner in the market, sunrun all the solar stocks, actually take a look at sun run joe manchin said he will vote
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against build back better program which does include $500 million worth of clean energy and climate investments. that is down 7.6%. canopy growth dropping on the heels of a downgrade to underweight from neutral the firm says the sales trends are under pressure across the business that stock down 8.4% jim cramer talking about it in the newsletter today to sign up, head over to or point your phone at the qr code there on the screen. >> all right time for a cnbc news update with fran collins >> good afternoon. here's your news update at this hour the pentagon is concerned extremism in the ranks issuing detailed rules to make it clear to service members what they can and cannot do while protecting their first amendment rights among the thing ts they cannot o fund-raising on behalf of an extremist group and posting extremist views on social media. thousands of protesters marched
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against anti-covid-19 measures government is planning to effectively ban any large new year's celebration business restricting private gatherings to ten people after christmas even if those people are vaccinated and ohio-based christian ministries showedreporters pictures and videos of missionaries that escaped captors in haiti 17 kidnapped for ransom in october after visiting an orphanage. five had been released and then the remaining 12 they seized an opportunity. >> when they sensed the timing was right, they found a wau to open the door that was close and blocked. filed silently to the path that they had chosen to follow and quickly left the place that they were held. despite the fact that numerous guards were close by with god's help, protection and leading, they quickly made their way through the night. >> there was an escape missionaries walked for miles to reach safety using stars at night and a mountain they had previously identified as a landmark to guide them
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tremendous escape. mike back to you. >> thank you very much let's get to bob pisani for more of the themes running through this selloff today hau bob. >> and, mike, we hit the lows around 11:30 eastern time about the european close the important thing is still very defensive tone to the overall market all the dow movers on the upside defensive, practicalor and gamble, for example, walmart, merk, johnson & johnson holding up better. this is a trend really for the last several weeks here. meantime, we're seeing weakness in the cyclical sectors. cyclicals are bank stocks which have been dropping as well as the big industrial names that we've been seeing. honeywell is a bit on the weak side finally, big cap technology stocks are down. they're sort of dmoun line with the overall market i think the big worry for the stock market today is the fact that cyclicals are getting hit hard this is another sector in addition to technology that is completely different and when
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you see that weakening, the only thing left helding up the market is the defensive names we'll have to keep an eye n. that back to you >> yeah. utilities and staples now faring the best bob, thanks. up next, liz saunders to weigh in and whether she sees in i opportunity amid the weakness in recent sectssions carnival weighs in on the travel sector we have 27 minutes left of trading. ♪♪ we all need a rock we can rely on. to be strong. to overcome anything. ♪♪ to be...unstoppable.
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index is up off the morning lows still down across the board. down 1.25% on the big cap and small cap indices. joining us on the phone, chief investment strategist for charles schwab great to check in with you you've been obviously tracking not just how the broad markets are doing but the damage that seems to be piling up below the surface. the braeak down in the typical stocks does that tell you mostly that this market overall has lost momentum and might be in do you havive mode or perhaps that we have the makings of a rebound coming >> maybe probably first the former and subsequently the latter yeah, you've seen a breakout in statistics whether it's new highs, new lows, moving average type breadth numbers that have deteriorated pretty noticeably but you're seeing a widespread in terms of some of the
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healthier from a breadth standpoint sectors versus the ones that are more damaged frankly, the churn under the surface has been pretty dramatic all year it's just -- it had different flavors to it. sometimes it's been at the sector level sometimes it's been in terms of rotation, sometimes it's been at the, you know, stay at home versus reopening cyclical versus defensive to happens to be a day where the classic defensives are doing relatively better like consumer staples and utilities it's the more cyclical industrials and industrials that are taking on the chin but got news is we're starting to see improvement in the sentiment conditions which were frothy before this started with the omicron news haven't quite set up yet for a sentime sentime sentiment driven pop. >> you've been enlmphasizing quality as a selection factor for stocks
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where does that take you in terms of, i guess, the types of names whether it is big cap over small or other factors that you think may sense the rebalance as we come to yearend? >> the factors we suggest you focus on have a quality wrapper to them. so it would be rising earnings revisions, that is particularly important when you start to get into an environment where there is consistently rising revisions and then factors like strong balance sheets and strong cash flow yield i think pricing power is important in this kind of environment. and i would say apply that type of analysis if you're a stock pick eastern not a -- you don't take a pass you have approach, apply it up and down the cap spectrum, apply it across the series of sectors. i think the factor approach doesn't in turn suggest you have to be myopic
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but i think the low quality traits that dominated the early part of this year, i think that is mostly in the rearview mirror >> you are baezing the calls on view that the fed is going to be able to tighten three times next year in terms of interest rate hikes and move up the taper as they have announced they're going to do? it seems like that might look aggressive to some people on the brink of the omicron variant which is spreading so quickly. and the fiscal withdrawal of stimulus >> a focus on quality has more to do with where we are in the cycle and just the simple notion that we're going from very loose monetary conditions to tighter monetary conditions. it's not predicated on whether the market is right in that we might have three rate hikes. we don't know yet. i think there is this -- from the questions i get, i feel like there is perspective that fed knows what it's going to do and just hasn't shared it with the public yet but take them at their word
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regarding data dependency. i don't think they have a defin tough idea yet of when they're going to start other than as of now still saying it will be post the end of tapering. but that could be kind of in conjunction with the end of tapering it could be may or june. we don't know yet. but just the simple transition into tighter monetary policy and the fact that there are a myriad of other conditions later in the cycle than the calendar would suggest just tells me that you want to have that quality wrapper around where you look for opportunities. >> yeah. i guess one element of being deeper into the cycle than you would -- you guess by time since the bottom is, what is going to mean for profit growth more broadly? in other words, if it becomes more of a struggle to get broad profit growth across the market, is that something you think is going to be a head wind into next year? >> yeah. so we -- if you look at as an
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example the city esarnings revision index that, rolled over then when we got third quarter reports, it rolled over again. it's flirting with the zero line where it's a ratio so it's looking at upward earnings revisions versus downward i think with on going input cost pressures, wage pressures, i think the real story is are we looking at a rearview mirror story with regard to just perpetually rising earnings revisions, beat rates that are record or near record, and profit margins that are at a record we may not be at a definitive serious inflection point once we get to the fourth quarter. but i think the chances that we -- that we end up with a record beat rate and even higher profit margins for the fourth quarter reporting season i think is probably fairly low >> yeah. might be a little bit too much to ask liz ann, thank you again appreciate the time today. >> my pleasure
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thanks >> all right coming up, the end of president biden's build back better agenda could have an impact on auto stocks that story and more on the selloff ne ithmaetonxtn e rk ze.
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skt sectors he is watching we have 15 minutes to go in the trading day. big selloff again. we're in the closing bell "market zone." today we have ally chief market strategy lindsey bell here along with the ceo and ladies, welcome. we'll kick it off with the broader market stocks getting hurt today again on the back of rising omicron fears. the dow is off 700 points. a broad selloff. every sector is lower. this is the fifth down day in the last six sessions. the nasdaq is in on the selloff. down 1.25% doing better than the s&p 500 which is down 1.3% you know, the strategy has been buy the dip recently on covid-19 variant concerns even on some fed tightening concerns is there any reason to think this time is different >> no. i mean, i am in the buy the dip camp right here. you're starting to see the pressure on the market over the last several days.
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we're starting to he soot economic impact that omicron can have on the economy. and so because of that, because you have companies, because you have local governments, state governments, talking about implementing new restrictions or actually implementing new restrictions, you start to see market participants get nervous about what the economic impact can be now i'm of the mindset, though, this is going to be a more of a kick the can down the road type of impact than a complete growth shock. if you listen to what the health care folks say, impact of omicron is a little milder people are staying in hospitals for shorter periods of time. if you look to south africa, the death rate decoupled from the covid-19 case rates. so there are encouraging signs and we're looking for 2022 to again resume above trend growth. >> sylvia, as we get through the periods of market chop, we really have been in for a few months now, especially below the surface of the indices one read is this is the market
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telling you what the new leadership is in which case it is dividend type stocks, maybe more defensive stocks and the sort of aggressive growth areas of the market really have gotten hurt badly the other sued says, hey, aggressive growth looks sold out. if you want to bet on some kind of a cocome back version, that'h pla is to look >> hi, mike. i'm on the other side in terms of growth being on sale and looking to buy the dip on some of the tech names. i agree with lindsey some of this is kicking the can down the road. the you're going to have some volatility until we sort out omicron and build back better and what liquidity we'll have from monetary stimulus if you just look at the banks, the names deemed to be overpriced, cloud is going to be one of the biggest movements in enterprise technology. you have the meta verse getting $10 billion worth of investments.
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amazon's cloud service could be a trillion dollar business i just think that looking at the company that's make up sort of that web 2.0 theme that looking at the future computing, you know, chips, clouds, anything that will power, evs, augmented reality, those are the same names that are the faangs that we bought for the services and products they sold and devices they sold. so i like these names here at these prices i don't think that rate hikes and, you know, increased tapering are going to massively impact the names they have quality balance sheets and they can certainly survive it >> all right the energy sector is the worst performers today let's get more on what is going on in oil. >> u.s. oil posting the worst day of the month, settling 7.3% lower. well off the worst levels of the date which saw the contract down 6.5% still comes after crude posted a seventh negative week in the last eight covid-19 cases rise, people are rethinking travel around the busy holiday season. that is hitting gasoline and jet
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fuel demand. today's slump sounds an larm bell for the industry. the recent boom may be over. the energy sector is down about 1.5%, holding up better than some other areas of the market, though today's biggest losers today energy is the only s&p 500 group in correction territory. it is also still the top performing sector this year. guys, back to you. >> thank you lindsey, interesting, six weeks ago crude oil above $80. everyone concerned about the impact on imflnflation and now s and now it's a growth scare. what is crude oil -- what are the energy stocks telling you if anything >> yeah. i mean, this has been a volatile sector especially if you look at wti oil prices there is a decoupling from the energy stocks and the wti oil prices that started about this summer you saw oil prices skyrocket, take off in the middle of the
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summer and the stocks didn't really follow but you've also seen wti prices fall quite quickly here with the rise in the omicron variant. and the stocks, they fell -- they got hit hard. but i feel like we are reefrping reaching a point where they may be t be returning if we can get on same page about where demand and growth is coming this could be a sector that gets back on to the same page as the k commodity price that reflects. we would like to see that get back on track. >> sylvia, as an investor focused on the faang names on sale and the meta verse themes, where do you fit on energy where does that fit? >> so energy is interesting! you have a short term opportunity here there is a dup tip to buy on a lot of this is today's move.
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it's the pan uk about we're going to be stuck at home longer number more flying you know, no more driving or commuting to work. i think this goes back to sort of that work from home hit type of trade and it's a really omicron headline thing for me though, i almost think that, you know, the oil and energy trades to have day are almost like what, you know, the amc of a decade ago. i'm looking -- when i think about energy, i'm looking at, you know, forward looking. so green metals, things like hydrogen and things like copper. basically we're trying to go carbon neutral by 2050 eventually this may not be a topic we talk so much about when we get close to figuring out how to, you know, find this sort of resources to stop that need. >> by the way, getting a little bit of a boost here. the dow down only 443 points again, session low was down 700. you saw utilities just pop into the green. consumer staples as well any recovery is being led again
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by the defensive sectors still, off the lows. financials hardest hit right now, down 2% the end of build back better program could have a big impact on automakers. let's get to phil lebeau for more on impact phil >> here's the reason why evs are under pressure today build back better if it disguise and it certainly looks likes it not going to go through means you won't see expand willing ev incentives for new evs being bought theoretically that, could hurt the sales growthover the next three to five years. longer term it may have a more limited impact keep in mind, you look at tesla, gm and ford, three three automakers ramping up production, you expect them to go forward these are three startups, their production plans can't even meet what is on their order books right now in terms of reservations so the ev incentives would have had a limited impact for them as
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well nonetheless, guys, any time you take away the potential incentive of 7500 or $12,500 per vehicle, people say, wait a second, its no got news for the evs. that's j thewhy the stocks are r pressure >> thank you >> i know climate is a big theme for you. does the fact that the build back better plan looks less likely get in the way of your thesis or do you still like the stocks where do evs fit in there? >> i still like the top stocks i think that again today's pullback put the need for tesla super interesting to mechlt i think the future is going towards electric vehicles and i think if i look at a company like tesla, they're so far ahead of the game in terms of the technology that they have, the testing, you know, working out all the kinks and what not tla there is just huge growth for vehicles so as phil mentioned, some of the newer names in the mix like
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rivian have waiting lists on the cars for, you know, unfor seen amounts of time. i think that again there is just going to be such a boom in ev. i think they're going to come out with cooler and more efficient cars every year. and it's, you know, it's only 2% to 3% of auto markets. even if you just sort of double that, it's a massive win for ev makers in the short term so i definitely like tesla back at this level. i think it will get back above the 1,000 mark fairly soon >> all right we have to watch that after the bell, we'll get our earnings from micron we have what to watch in that report >> hey, mike with the chip shortage front and center, analysts want an update on micron to what extent the shortage improved and other tools it is using to deepen manufacturing here as well as overseas the other focus will be on memory pricing and the outlook for 2022 according to credit swuisse, the are growing 2.5 times the
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broader industry shau shares are only up around 9% this year. micron is the top pick with a forecast for this quarter to see strength across the board. that includes data centers, mobile, pc, and auto the stock currently down about 1% in today's trade. guys >> thank you very much silindsey, where would semis fit into your plan now back of the highs with the rest of the market they have knhave knno broken down really >> it is interesting it plays into what sylvia is talking about with the evs this is a high demand, high growth area as we become more tech know logically connected in the years ahead. and so i you this that there is plenty of room and legs for the semiconductor industry to grow on so i just think there is a whole lot of momentum behind the stocks and more to come in the years ahead. >> sylvia, looking at the
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broader market, down 400 continuing to recover a little bit. volumes are a little below average. but still, you know, the s&p 500 at one point is tracking for the worst day in december. and you know, most of the average stocks as we've been talking about this whole hour are down sharply, 20% or more from the highs the dindices look better. what environment do we find in now that we're this is persisting >> we find ourselves in an environment where inflation stuck around and we hoped it would be transient less stimulus. less liquidity in the market we're in the last week or two of the year, volumes are going down people are doing less trading. i think that is exacerbating it. president biden's bill came into negative light so we have volatility. i would expect this range bound volatility for some time i'm very bullish on 2022 we're not in a recession we don't need all the fiscal and monetary stimulus that we had.
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consumers are 70% of gdp it goes back to lindsey's poivenlt kicking the can down the road because of omicron and perhaps subdued supply but, yeah, i mean, i'm bullish on the market for 2022 >> he got just over a minute left heading into trading. what you are seeing in the market internals >> it's been a sneaky rally since about 11:30. the s&p 500 up really about 1% since the lows this mork tested the down side for a couple months. internals are still on the ugly side very difficult to turn out around the advance-decline line. even worse earlier than what we're seeing right now russell 2,000 is another undechl that seemed like it bent but didn't break it went below what has been the low end of the longer term range this year. and then it sort of seems to have firmed up right there that's a really long term range
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it is bleeding lower since they sta sta started making new lows. i'm net positive in the few hours of trauding here the s&p 500 finishes out just over 1%. the dow down 437 700 at the peak. nasdaq is also lower on the day. also not really underperforming as we hit the close. >> still the worst day for the s&p 500 since december 1st welcome back to "closing bell. >> unveinvestors awaiting analye from micron and niky carnival ceo on his company's latest financial results and how the surge in omicron cases is impacting his bookings first up on the market, senior global strategist from wells
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fargo joins the conversation what you are telling your clients who a lot of them are losing a lot of money today and have been in recent weeks. >> well, sarah, what we're selling them is the markets only down about 3.5% less net from an all time record high you got have a plan. you got to know what you want to buy. you have to know where the technical levels are the low today is close to 100 day moving average we want to bias the market approach that we're further, to the 200 day moving average in the s&p 500. if we start to approach that, we want to be buying. so these are opportunities that investors have been looking for. time to pull the trigger when you have the opportunity >> yes the market is only 4% from a record high. the average stock is 28% from the recent highs broader market is just a handful of big cap tech stocks
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you have to look at the individual sector indices and thins like that. so, you know, technology has taken it on the chin here. we want to growth kpoent we're looking for 5200 next year by the end of the year for the s&p 500. we're not going to get there unless tech at least participants we think it's going to outperform az as tech gets hit, we want to look at the sector charts and find out where the support is. we're close to it in technology. so you want to be buying here as the market pulls back. >> scott, as we sit here and kind of driven to some degree by headlines about the latest covid-19 surge and see some damping of consumer demand for travel, you might be able to say let's run the playbook again there is going to be now another reopening trade arguably set up. is that something that seems like it makes sense to position for right here have we not yet seen, you know, enough of a pullback in those
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sectors to make that interesting? >> i think we haven't seen a pullback overall we that i is still in play that's why we still like industrials. we like financials but you have to have a view is omicron going to get out of control and cause a lot of shutdowns? you know, we don't think so. is the employment data going to get better we think it will is inflation going to decelerate as we look out over the next 18 months yes, it will consumes have a lot of cash. they want to spend things in our mind look good as we look ahead. so once again, you know, as i mentioned to sayer yashgs the pullbacks are opportunities and sectors are going to participate in a continuation of the recovery >> so you know the bear case so we have this omicron variant which is delaying return to work yes, we won't see government mandated lockdowns that's no the what president
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biden is thinking of but that's happening restaurant reservations are down double digits from where they were in 2019 starting to see that in the open table dat yachlt people as i said are not going back to work. schools are trying to stay open, they're closing because of covid-19 cases at a time where the federal reserve is much more hawkish and potentially planning three interest rate hikes next year. at a time when system laus lsu stimulus is coming up and likely we'll get more. >> the federal reserve, you know, three hikes next year which that's surprising. we didn't think they were going to do that much p. but that is still under 1% and i think it's hard to energy that you need emergency monetary policy, you know bh, when we're going to see 4.5% growth once again, as inflation is decelerating and as these headwinds aren't as much for the reopening. now is that going to negatively affect growth? sure sure it is but in our opinion, it's a
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temporary situation. it's going to probably play out over the next few months but as i mentioned earlier, you need to have certain views on things like the virus, employment, inflation, the fed, and you have to have a view on those to feel good about buying on the pull backs. for us, the things you mentioned, they're positives we want to take advantage of it. i understand the negative side of things. the probably inflation is the biggest risk to our outlook. i don't think the fed is going to make a mistake. but there is certainly risks out there. the you have to try to put some probabilities on the things and you need to rationally look ahead and try to do some projecting thats what strategists do all day long >> scott, stay with us micron's results are out we have the numbers. >> shares of micron on the move here in after hours. the company reported a beat on the bottom line. $2.16. that is ahead of wall street
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expectationsof $2.11 sales in line with wall street consensus. the ceo of micron tech says we're now shifting our industry leading d-ram and man technologies across major end markets and dlufrd new slaugss to data center client mobile graphics and automotive customers. he referenced powerful secular trends including 5-g and ai. can you see shares up over 6.5% here in extended trade the conference call, guys, starts at 4:30 p.m. eastern. i'll be on it. back to you. >> thank you very much let's bring in matt bryson from webb bush securities he has a neutral rating. $85 price target on the stock. matt, give us your first impression seems like the revenue guidance maybe is behind some of the cheer in the after hours trading. >> yeah. certainly. that is the guide. when you look at this management team, they're known for guiding conservatively
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they came out and they guided the numbers. people are looking for fundamentals in the bottom over the next two quarters. and it looks like a very good guide. particularly given my concerns, for instance, that numbers would come in simply because they're so conservative. >> right so that is being taken as even more of a positive than otherwise might. so you have kind of a hold rating on the stock. it's right around your price target what might change the outlook for you in terms of, you know, how the stock is valued relative to this new outlook? >> so when i look at my port gr portfolio, the stock hasn't appreciated. and in general, memory industry hasn't appreciated as have names like nvidia or amd
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when you look at the other line trends, ai certainly ai requires more d-ram as well as vpus so i find that very interesting moving forward what i've been waiting for is for fundamentals in the underlying memory markets at the bottom so to see the pricing more favorable. as of now, that hasn't quite happened but that's really what i've got my eye on. >> maett, do these results suggest anything being alleviated around the global semiconductor shortage which micron has been affected by? >> i don't know. one of the issues for micron and the memory pop-ups has been that the companies were building inventory throughout the first half of 2021 and when they started running into trouble
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shipping p shipping products, they couldn't get other semiconductors and they couldn't ship a pc or automobile, they started to cut down on inventory. what is hard to say is end demand is reboundir si -- nthat inventory neutralized and it may get better once there is some availability normalizes. the. >> how is the setup more broadly for the group, matt, as we look into next year i mean, what favorite areas are there? some of the ones that seem like they couldn't miss like inveda had this amazing run and now it has been for sale for a couple of months so what are the themes that are most important heading into next year >> i certainly think that from a investment perspective, nvidia is all over the place. when i think there is more money
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spent, i'm confident that large cloud companies are going to spend more enterprises are going to spend more and we're going to see p proliferation of electric automobiles and that will all float into the semiconductor complex. again, if you look at all of those names, some of the names have brappreciated a lot. some like hay micron and silk in motion, i don't think they're appreciated that they also benefit from all these other trends you need more memory you need more storage. and so i think in my mind at some point wall street needs to realize that these companies do benefit and that there is room for them to enjoy appreciation from the peers have seen over the past couple months >> matt, thank you for joining us with that instant analysis.
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we appreciate it micron up now building on the gains, up 7% after hours scott just quickly on the semiconductors, micron is underperform they are year but the i.t. component of the s&p 500 is a double digit winner is that a favored trade in 2022? >> if we look inside of technology, sarah, you know, semiconductors, software, cloud, automation, anything that really is tech know logically oriented. businesses are going to be doing some capital spending this year. and a lot of it is going to be on anything that has to do with automation you know the labor market is tough out there. so companies are looking for ways to get more efficient, more productive and automate. >> so i think i stole some of the thunder from your zone in best trade idea. while we have you, we want to go with what you're picking, your absolute favorite. >> i think, you know, as far as sectors go, technology
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once again, it's been year to date, six months, three months, the best performer it got hammered lately it's almost 30% of the s&p 500 and to get to the 5200 which is about 14% from where we are right now, we need technology at least being participant and we think it will lead the charge higher that sector has to participate to get to that number we're looking for. >> scott, i mean, you seem like you're reverse engineering what sector has to work based on the target that is not really the indicates, is it >> that's not really the case, no the it's just a realization that, you know, sarah brought up earlier, you look at the big name stocks. can you say that in a consumer discretionary, technology, a couple of other wins you have to be well aware and have an opinion on the gigantic names that drive the sector. consumer discretionary, if you're paying attention to apparel, i mean, that is a small market cap you need to be paying attention
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to the drivers of the sector i'm at the sector level and so is you have to be very aware of the companies that are going to be driving us. we have to be aware of what the outlook is you have to have an opinion on what the outlook is. and, you know with, technology, it's even more important because it's such a big chunk of the s&p 500. >> and, mike, you brought up the idea of a playbook around a variant. if you look at what underbetter formed today, it was the classic stay at home winners at least that went around the last few tombs peloton down another 9%. they have their own problems docusign st so that's not all that is going on here. >> no. those areas have been really just so blown out that i just wonder what the broader macro message is there just seems as if year end people don't want -- it's a reverse window dressing here they don't want to show the beat up stuff on their books. yeah, i think at some point if people really did seize up and
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get nervous about the macro outlook that, would set up perhaps another version of that reopening trade. it's not clear to me that's happening, sarah doesn't it feel like everyone is onboard this is a brief spike and not necessarily have lasting impact i wonder how that filters into markets. >> i think the fed tightening adds a whole new dynamic scott, thank you we appreciate your time. >> thanks, guys. >> good to see you we're just getting started on the second hour of "closing bell." nike one of the biggest decliners. next, we'll break down the company's latest earnings and get reaction from an analyst carnival, one of the view bright spots on wall street they expect xbeblgt to return to profitability in the second half of next year arnold donald discuss wlz surging omicron cases coultud rn back that profitability time line "closing bell" back in just two minutes. her... ...and dry, cracked skin. new gold bond advanced healing ointment.
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nike erpgs out 83 cents adjusted. much better. 20 cents better than what analysts were looking for. eps 63 cents revenues, $11.4 billion. that came in a little better here's the story with nike it is a tale two of geographies. north america coming in very, very strong. almost $5 billion, 12% growth. china on the other hand, a key growth market for this company, coming in weaker than expected this was the worry going in f it looks like the china numbers are light. $1.84 billion. that is down 20% so that was a little worse than what analysts were expecting gross margins are better of they had supply chain problems they warned about it it looks like it is impacting the china market especially hard the stock is up after hours on
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the overall top and bottom line beats. very strong north american numbers. for more on the nike results, let's bring in our analyst i gave what you stood out to me. what about you what is important here >> sarah, i'm the sell person. i'm supposed to tell the tale of two cities i think at the end of the day we have -- you hit it north america strength and china weakness the question is does the china weakness persist i think that right now if we take that first half and we look at north america strength, despite the size that nike is, that's a really good number. that china, like the stock is up it's not up a lot. we're still off of the peaks i think that will be the question people have to ask. that will definitely come up on the conference call. that's a question we have to continue to focus on
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>> a stumble in china is a problem. doesn't look like a problem right now. the market, it was worried about china going in here. stocks up almost 3% after hours. you got the rolling shutdowns. you have the longer leave times from places like vietnam going to china is there any reason to think that there is a bigger problem here with the brand in terms of recovery or do you chalk it up to the factors that are hurting >> i think that's important. the question is this the consumer demand issue? if it's ai consumer demand issue, nike will get through it. there is no one with their budget or scale. you and i talked about many times over the last several years and long wer where nike h a competitor they deploy r & d and marketing. i think it's very hard to fight a company with that scale. if it's something bigger, more structural, that's where we have the issue. i believe it's going to be
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transitory and that's whoa we're going to see i'm more on that side of the camp i don't think we'll be able to answer it yet. >> you know, it's been a long running trend. there are consumer sales and faster than normal revenue this quarter and it's up 1% total revenue. there is revenue in the past quarter. and it's through that channel. what do you think might be ultimately where that settles out? and what does that mean just for in general for nike's margins longer term? the stock valued as one that should have premarkium margins a long time. >> i think nike's margins come from the brand strength. i don't believe they come from direct my team has done a lot of work on this notion i think we're going to see direct penetration for all brands grow. what is important to acknowledge
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is the largest most profitable brands gloot there by embracing wholesale. so my view is that use the right wholesale partner which nike is very clear about they talk about this differentiated retail and focus. they're not walking away entirely they're making sure the brand image is healthy and strong. i think that's what we'll continue to see. i think for those that do it well, they'll have a very strong blend of their own business but also very strong wholesale partners i think just simply walk ing awy from wholesale entirely is not the way to go. >> maybe you'll ask this question on the conference call. i hope you do. about what they're doing on technology because they're making a lot of interesting moves. they acquired artifact they make digital nfcs of shoes. they're talking about the metaverse and filing patents the sneakers app started with a little known acquisition that they built into a huge company i wonder how big given john's
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background in the digital world this is for them >> i think rest assured, we're not going to have to ask it. it will be one of the first things they bring up this will be a topic of conversation and i think it's another -- like china, we'll be talking about it for a long time. like china, determining how much it moves the needle, that will be a long time to figure out >> thank you for joining us. good to have you. >> good to be here >> sayrah, not sure if you saw i but that round hill metaverse etf with the symbol metaed aed nike as a necessity holding. >> there you go. >> a small holding but someone's listening on that front. >> they're thinking of play. >> i just want to know how big they think it's going to be. mine, you can't run into the metaverse and not wearing sneakers they're going to be there. all right. up next, carnival's ceo arnold donald an how the omicron can impact the company's bookings. and moderna getting back early gains despite new data showing
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the covid-19 booster shot gives significant protection coming up, a top analyst discuss wlz e ocs ce dlithstk'rentecne is a buying opportunity. want video content to engage your audience? fiverr gives you direct access to specialty freelancer skills, like video editing, with great value at any price point. head to today and get something started.
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norwegian and royal caribbean requiring masks onboard. 48 passengers onboard a cruise ship tested positive for covid-19 over the weekend. shares of carnival rallied up 3%. the company said it expects the full fleet to be back in operation by the spring of next year joining us now for an exclusive interview is arnold donald, carnival cruise ceo. welcome become. >> happy holidays. got to be with you hi, mike >> and happy holidays to you so you told investors today you were seeing a little spike in cancellations from omicron can you give us a little more color on that? the stock is down 6% since black friday when the omicron fears first emerged. >> we have nine cruise line brands they're all officer the world. so the impact in different places is different.
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but overall, you know, we responded well to the delta variant in terms of the trajectory of the business we sailed over 1.2 million guests now and a number of them even before they were vaccinated now we're vaccinated and other protocols with, very sailed successfully cruising may be the safest form of social gathering and travel there is right now having said all that, you know, again, consumers react media reacts what i'm hearing medical experts are thinking that perhaps while it is more infectious, that it is less in terms of the negative impacts. things like hospitalization or worse. so, of course, that's good follow on society.
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we're seeing robust bookings second half of '22 into '23. strong pricing that's without us having done much >> is it really safe to be taking a cruise right now with the spike in cases >> again, we have very effective protocols onboard. with very to stay flexible and adaptable with the information today that is available. yes, it seems safe if information changes wee, we' respond to that completely the cruise is the safest place to go to a restaurant or a theater or whatever. if it is safe to do those things, it's certainly safe to do a cruise. we're testing people that have to be vaccinated again, it varies we have masking onboard. we have depending where you are in the world other prot protocols in place to say nobody is going to contract the virus makes no sense. obviously, that's out there in
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society at large and it's happening but the trick is keep minor symptoms and make sure it is not sp spreading on a ship. so far we've been able to do that >> arnold, you made the case to investors that you've got the cash and the access to capital to kind of keep going in this environment. just how long can this go? i mean, obviously, you've been forced to operate in a small fraction of 2019 levels. but when do things have to start to normalize for you to actually be able to okay in terms of your cash holdings? >> mike, we're ending at $9.4 of liquidity.
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we don't think we'll need it wented about the same last year when we had no ships sailing or very few and now we have about 60% of our fleet sailing with more to come. and so we now have the opportunity to generate cash and, in fact, our customer deposits which is one source of cash has increased about half a billion or so recently we're up to $3.5 billion to customer departments now where we were below $2 billion a year ago. things are looking positive. again, we have to stay adaptable. this is a dynamic environment. we have to adapt to changing conditions and we have throughout this period we'll continue to do that. the overall trajectory is positive >> what is your biggest problem right now, arnold? is it getting staff to come and join the cruises it is the public perception? what is -- >> no. we have robust demand.
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the biggest challenge is itineraries. where we have itineraries kpaurable to the itineraries of 2019, for example, our carnival brand, the carnival brand is sailing certain sailings at 100% occupancy safely doing that. many at 90% plus occupancy because the itineraries are similar to what people cruise previously so mainly, it's having destinations and itineraries pt you know, china is still closed australia is still closed. we can't do world cruises. you can't rely on destinations being open to be able to do a world cruise those, are you know, heavily booked and high yielding and so on so those are our challenges. but all of that will play out over time. as society becomes more comfortable with dealing with this virus there will be additional variants in the future we all know. that the virus isn't going anywhere but the most important thing is the science has advanced,
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vaccinations, understanding protocols. now treatments there are therapeutics if you contract it and previral prescription medicine that will come out all of those things make it such that people can contract the virus. but not being concerned about being hospitalized or have a worse effect and that's something i think most critical thing for all of us to get back to. the for right now,en into this environment, we're able so far to sail safely and we'll continue to take the advice of the global experts, medical experts and science experts and, of course, being in compliance everywhere around the world. >> yeah. they have given you a lot of rules. arnold donald, thank you for joining us >> thank you guys. the happy holidays, guys thank you. >> happy holidays. projecting optimism. the stock closing out 3% biotech, a bright spot also during today's broader market selloff. the group is still down 18% this year up next, a top analyst weighs in on now is the time to bet on a biotech bounce back.
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time for a news update >> hi, mike. from the news on cnbc, what is happening this hour? reversing a trump era rollback the white house today addressing climate change with fuel efficiency the biden administration raising vehicle mileage standards to reduce emissions of green house gases. the rule goes into effect in 2023 it targets 40 miles per gallon by 2026. that is 25% higher than the trump administration rule. >> masking up in d.c it will be mandatory when you're inside starting tomorrow morning in the district. they're also announcing the closure of schools january 3rd and 4th so that families can pick up rapid tests for students it is part of the white house's test to stay program an effort to keep kids in school with testing as cases surge. and 2022, arriving in times square ahead of the new year the actual numbers 2022, the 7 foot tall digits are on display for photos through thursday.
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they'll be -- then they'll be raised atop one times square the new year celebration is still on for now the mayor says he'll decide by christmas whether the ball drop will go forward as planned tonight, jury watch. three big trials nearing the end forever elizabeth hole ams, gill and maxwell and potter news right after cramer on the news back to you. >> all right thank you. we'll see you then shep smith >> moderna shares today falling more than 6% amid the broad market selloff giving up early gains. the company came out an announced the booster dose appears effective against the omicron variant. joining us no you is michael ye, analyst with jeffries. why did the stock go down? wasn't this good news? >> great to be here with you you know, as it relateses to moderna stock, i think all the vak steen stocks were down today. suggesting that, look, a third boost gets you to where you need to be.
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that wasn't stunning or surprising that's what pfizer said a couple weeks ago. looks like we continue to go long and beat those and nothing changed the census numbers >> is there an opportunity here moderna stock? it's so volatile obviously a long term winner and you pushed back, i think, on it as a covid play do you see any snunt. >> we pushed back on this because there is so much focus on covid-19. as you see, we're continuing to move forward into 2022 or vaccine demand in the numbers. we've been desensitized to it. so i think that's going to be an issue longer term. there is a lot to do with moderna. certainly not near and medium term growth. we're focused on recovery stocks >> michael, you know, the overall biotech sector has been profoundly weak. even, you know, setting aside
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moderna. is there anything going on in the industry whether it is on the regulatory side? is it just in vestor preference right now? is there a stall to the innovation cycle as the vaccine efforts steal a lot of the energy what is happening? >> i think you're right. one, we've been telling investors after a three and four year huge bull market, frankly, 2020 and 2021 was a huge rotation into recovery stocks. you have all the focus going on are we going to go on cruises? you just had carnival on there is just not a lot of focus on what is going on in the cancer drugs i think that as we turn to 2022 and 2023 and less focus on specific recovery stocks, the sbi which is now so much this year down 18% was at 40% discrepancy for the s&p 500. one of the biggest discrepancies
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we've ever seen. there should be a bounce in 202 driven by m & a. that is one thing all of the pharma companies and, two is, you know, there is a huge routing of all the companies there is a lot of stocks here at biogen in 2022 >> i was going to ask you to name names s that what you this i is being most underappreciated are those the two picks? >> yeah. look, i think for the large names, i do think that it has to be the single number one stock for 2022 based on the fact they reported a bunch of great pipeline data for two new drugs. the stock didn't move. i he think as the thesis plays out, we get a bounce i think it is the cleanest and best story for 2022. the i think amgen another one that is totally left out to hang this year. one of the bigger underperformers this year.
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and that stock islooking good. so i think there is a lot of these oit and stocks that large cap that could bounce back >> yeah. interesting catchup. thank you very much. appreciate it. >> good to see you >> all right up next, kkr's henry mcvey on whether the recent selloff overdone and where he sees buying opportunities right now plus, amc shares swinging higher after spiderman's blockbuster weekend. amc's ceo is weighing in on the impact of the box office boom. det details later on "closinbe."g ll retirement income is complicated. as your broker, i've solved it. that's great, carl. but we need something better. that's easily adjustable has no penalties or advisory fee. and we can monitor to see that we're on track. like schwab intelligent income. schwab! introducing schwab intelligent income. a simple, modern way to pay yourself from your portfolio.
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all the major averages finishing lower on fears of the omicron variant and what the renewed concerns mean for next year's global markets, let's bring in kkr balance sheet cio henry mcvey. great to see you >> thank you for having me hope you're well >> absolutely. it's a fascinating moment here considering a week ago i think people were plausibly saying that hair they're behind the curb and going to go into tightening mode. we sit here, people worried that the fed son the merge of making a mistake. they're worried about the slowdown that might be in training after the latest covid-19 surge just give me overview on where you see macro heading into 2022. is this a pause?
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>> we published the piece last thursday the message is we're seeing a tightening of financial conditions globally, right the 24 central bank wez track half of them are raising rates that is new information. that is unsettling to many where we're focused is a firm is there is still aye huge amount of liquidity if you think about the g-4 central banks, the fed, ecb, banking of england, you think about that and the bank of japan, they increased the balance sheets by $13 trillion that is 29% of those economies gdp. so that's .1 >> pete: .2 is we're starting from real rates at extraordinarily low levels i were talking about biotech being out of favor, that's going to happen from time to time when you have the uncertainties the final thing, michael, is just this recovery which is the title of our piece, is a lot
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going to be different. we front end loaded the spend. consumes have almost three trillion of excess savings starting the recovery. they pay down the debt the house prices are up. what we see, we have 200 companies globally we see more of a labor shortage than an excess of labor. so i think you're going to see spending i think it's going to come in different forms. we fully expect that science will catch up with the mutation. we think it's going to be a bumpy '22. just remember also, we were up 20% in 2020. we're up whatever, 22, 23% and people are cleaning up their books ahead of year end. that makes sense when we get into next year, i think is key drivers we can talk about those. >> i no he that you pencil in a target with good earnings growth so maybe the valuation comes in
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a little bit do you that i comes in the context of inflation actually receding quickly enough in a satisfying way >> i don't think inflation is going to recede as fast as some of the bulls think there are two things, one is about a third of the inflation measurement is housing we're very constructive on housing. we're investing aggressively behind that on the global basis. t the second thing is labor. that is very different this cycle. particularly at the low end, wages are rising more quickly. investors should expect. that we're useing a 5% cpi next year consensus is 3.6 it will come off towards the second half of the year as energy prices and other commodity prices ease a bit. but there is a structural stickiness to the inflation that we're forecasting. and we're allocating to areas where we can own inflation protection more. real estate, real estate credit,
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infrastructure, asset based finance, some of the longer duration private equity. so we think that this recovery is different there is a lot of opportunity around that. that's the way we position the firm >> and so what areas would be net losers let's say in public markets from the 5% cpi obviously, that means growth is probably good. some things maybe get knocked loose along the way. >> a couple areas to focus on. number one if, you can't control your labor costs are that's going to be an issue number two is if your unit volume is slowing, right it is strong f you're in the areas where consumers are spending, you're going to do just fine. we try to look at the world simply and say they're price makers they can set prices and price takers a lot of could be assumer staples are price takers we seem this in real estate and industrials, certain parts of tech some of the commentary you were making earlier on cloud. of those are all going to do
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really, really well. this recovery will look like the 2003 to 2007 recovery. at that time china was building out the fixed investment it was creating a lot of noise around the costs this is the same story this time it's the global energy transition right? we're spending as a global economy one to two trillion per year building out the renewables yet, we're living in a time where 81% hf global energy is still coming through old economy sources. oil, narlg gas, coal so it's not going to work smoothly so this is definitely a year to buckle up. our work shows given what we've seen from a historical standpoint, valuations are and earning rshgsz can you make money in this market >> all right buckle up. maybe end up in a decent place eventually henry, great to catch up with you. thank you very much. have a great holiday >> have a great holiday. thank you. >> up next, we'll take a look at
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how small chaps compare to the broader markets and perform again today. plus, what to expect in micron and nike's conference calls:the guidance is strong that stock up is 6.5% after hours. we'll be right back. slash... and this is the basement slash panic room. maybe what your family needs is a vacation home slash vacation home. find yours on the vrbo app.
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we're staying for the s&p since december 1st back to mike, taking a closer look at the small caps which have underperformed, down 13% off the highs. >> yes you see the s&p 500 against russell two 2000 value and growth value from a higher point but the decline in the last few weeks looks similar here and really the compression of valuation has been the story look at a snapshot how small cap value, small cap growth relatively valued against the s&p 500. look at this massive premium small cap growth, price to sales number all it's really done is give back part of that premium in small cap growth built up. it's unclear if you have rung out a lot of the excesses. relative to the s&p, looks a little bit better. value really hasn't had a lot of change to sales and still trading at a bit of a discount
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to the overall market. you still have at least a premise there for a value outp outperforms and a lot those small cap growth stocks won't er earn, any money. next, what thelobuer bckst means for the entire movie theater industry we'll be right back. when it comes to autism, finding the right words can be tough. finding understanding doesn't have to be.
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amc a big winner today after a box office bonanza from the latest spider-man man movie. hey, julia >> well, "spider-man: no way home" soaring past the highest expectations with the second biggest domestic opening weekend ever $260 million and the third largest global debut ever, over $600 million. now, boosting theater stocks and amc and senmy mark, we saw imax shares down. >> we set a new record thursday. a new record again on friday a new record again on saturday just to put 7 million guests in a weekend in perspective, we
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didn't do 7 million tickets in the entire first quarter of 2021. and that tells me that movie going at cinemas is back. >> movie going for superheroes is back. guillermo del toro's nightmare alley tanked with $3 million at the domestic box office. that could push studios to focus more on the big franchises and the popular superheroes, guys. >> thank you. it does raise a question of amc stock rallied on the news today. what happens to the meme stocks if we are in this new dynamic of fed raising rates and taking away the punchbowl, non-profitable tech has been a victim to this liquidity coming out. but you are spacs in there are the meme stocks in there as well >> i think they all fit into this idea of kind of hot money destinations, speculative finance, concept finance, all
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that stuff basically that's not tethered to kind of immediate fundamentals but it's all gotten kind of washed out pretty well that's the question, not so much are they part of this process. has the market already kind of preemptively, especially when it comes to things like the aggressive growth stuff and the smaller stocks that got washed with it, is that game over for that stock or is it just now they have gotten depressed enough going into a new year when you often have a rally in the beaten up low-quality stocks, are they ripe for it that's the big question. i think amc and gamestop are play things when with people get bored of them, you know, they move on. >> there you go. mike, as for what we are watching tomorrow, we will be listening to the micron and nike conference calls both of those calls one focus will be on supply chain and whether things are getting better, at least when it comes to the nike earnings, guidance, we will see if they continue to predict hardship in places like china, which crushed the results, down 20% year over year
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on revenues. micron, too, on the semiconductors. >> everybody is now focused on the risk to grow that seems like the supply chain is at least not getting worse. you could probably hang your hat on that. also, don't overlook the fact that we got a decent intraday rally over the course of the day. maybe the market is saying that's where we get traction. >> mike, thanks for being with me for the two hours that does it for closing bell. "fast money" begins now. this is "fast money. i'm melissa lee. tonight's lineup tonight on "fast" we are charting the sell-off. chart master says a key level of support. is a turnaround coming in what he is sig seeing in the charts all over the afterhours shares of micron and micron, on the move, strong moves higher. we will break down the big headlines from the quarter later carnival cruis


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