Power Lunch - Apple’s new phone, king dollar and low volatility stocks with big, potential upside. 9/7/22

Episode Date: September 7, 2022

Apple unveils the iPhone 14, Apple Watch Ultra and new AirPods. What the new products could mean for the stock. And with the dollar index at a two decade high, a top technician tells us which mega-cap tech name stands to benefit. Plus, three low volatility stocks that have potential to outperform. That’s today’s three stock lunch. Hosted by Simplecast, an AdsWizz company. See https://pcm.adswizz.com for information about our collection and use of personal data for advertising.

Welcome to Power Lunch, everybody. I'm Tyler Mathis. And we got breaking Fed news at this hour. The central bank's big beige book due out momentarily. Amid growing speculation, another supersized rate hike is on the way. So how high might rates go? We will look at that beige book for any signals. And where can you find the biggest returns in this new era of investing? We'll talk about that.

Plus the dollar index, highest level since 2002, making some popular stocks a little bit more risky to own. The names to fade. to buy as the greenback strengthens. With me, Courtney Reagan with a check now on the market. Hi, Corey. It's great to be here with you. Well, stocks are at session highs ahead of the beige book, the Dow, the SMP 500 and the NASDAQ, all sitting firmly in the green, the NASDAQ, the leader of the bunch, higher by 1.6%. The 10-year yield falling back below 3.3%. And this after adding roughly 16 basis points in trading yesterday. And crude, check this one out, down 5% on concerns about the economy.

Baker Hughes and EOG resources, the worst performing energy stocks. All right, the Fed Vice Chair, Lail Briner, this afternoon, said the central bank will fight inflation for as long as it takes. This comes as the likelihood of a three-quarter point rate hike at the Fed's meeting rises now to more than 80%. Our next guest has some stock picks for this changing investor landscape. He's Mike Bailey, Director of Research with FBB Capital Partners. Mike, welcome. Good to have you with us.

How do you handicap the likelihood of a three-quarter point hike versus a half-point hike? And how would one affect the market differently than another? Great question. I think at this point, it's, I hate to say, a foregone conclusion of a 75-bases point hike. I think that's probably consensus at this point. So if that were to happen in a couple of weeks, I wouldn't see a major impact on markets. I think the question is, what's next? Is there some additional Fed language on the table?

next rate hike that maybe is steeper than investors expect, that would be kind of a negative outcome. On the other hand, if we do get a 50 basis point hike, I think that's favorable. I think that would be upside for markets. Investors would see a little bit of a doveish tilt for the Fed, and I think investors would start to see some green if that would happen. Mike, how far out is the Fed willing to go at this point? I know they had sort of decided, as they always are, to be data dependent, but in a way sort of wanted to pull back a little bit on telling us exactly or telegraphing exactly what they were going to do until the data comes in. So if they go 75 basis points, does that mean after that they could go back down to a quarter?

Or do we really just still have to wait and see how fast monetary policy does impact inflation? I think kind of the wait and see approach or being data dependent. I do think the Fed is going to take that approach. I think probably for this next rate hike, they've dug in a little bit of a hole. I think the 75 basis points is pretty clear. It'd be really hard to imagine something changing that. Maybe the CPI number next week that comes in really, really cold. I think that's unlikely. But beyond that, no, I think the Fed has given themselves the ability.

They've hit things pretty hard up until now, a bunch of big rate hikes. If things do start to cool down a little bit the next few months, I think they've given themselves the ability to pull back just a bit. I really would anticipate, though, the next one. It's really hard to imagine them not going hard and hitting the 75 basis points. You've got three stock picks that you want to tell us about, and I'm wondering what they have in common and why you choose them. Adobe, AbV, and PNC Financial. each in different areas of the market, different businesses. Why? So I would argue quality and diversification. You know, it's been a pretty crazy 2022 so far.

You really want to make sure you've got all your bases covered in terms of a little bit of growth, a little bit of value, make sure you've got some dividends coming in as far as the income. So, you know, we do want to sort of check all those boxes, and valuation is key for us. So we look across businesses. Is there something that's high margin, kind of sticky customer base? You can start with Adobe. They're going to have earnings next one. weeks, we'll get an update there. Pretty good business. A bunch of the tech sectors really got in whack this year. A lot of those problems, and in particular for Adobe, it really has been macro. So currency is hitting them. Not much they can do about that. The underlying business is in pretty good shape. You're just buying it way, way cheaper now than you were back in January.

So it's a good, we'll get an update. The other two, kind of the other extreme, you know, good businesses, just much lower valuations. Right. have the, you know, a drug company. They got some good news the other day. A competitor stumbling. That's good for them. You're going to keep getting this pretty impressive dividend. And banks, you know, regional banks, again, pretty steady. You're not sort of betting the farm on some small cap, a very nice dividend.

Recession is probably priced in. So again, you're buying these things when a lot of bad news is there. I think there could be some upside, you know, if you see a bit of a recovery in terms of banks and rates. Mike, thank you very much. We appreciate it. We've got to move to some breaking news now from the Fed. and Steve Leasman has the latest from the beige book. Steve. Tyler, thank you very much.

The page book, the collection of economic avenues from the 12 Federal Reserve Bank District says. Economic activity was unchanged over the course of the six-week period. Usually they say it's modest to moderate growth. First unchanged we've seen in a while. Now, five districts say there was slight to modest growth. Five districts said there was slight to modest softening in growth in their districts. Most districts did say the consumer spending was steady, though auto sales were muted. There was solid leisure and hospitality activity across the districts, though.

Manufacturing did grow in several districts, but some manufacturing declined, and that was due to supply chain issues and labor shortage. Residential real estate weakened noticeably, according to the Facebook. The growth outlook, however, remained generally weak overall for the U.S. economy. When it comes to employment, it rose at a modest to moderate pace. Labor market conditions remained tight, but one bit of good news here. there was some improvement in labor supply. The reports of slowing wage growth in some places, but prices remained elevated. Nine districts, though, reported some moderation in the rate of price increases or inflation. There was substantial price inflation, though, reported across all districts, including for food and rent and other necessities. Some tapering was seen in commodity prices, and pricing pressures, however, according to the context of the Federal Reserve,

were expected to persist through the year end. bit here. Let me add, Michael Barr, the vice chair of banking supervision of the new vice chair, laying out his views on banking regulations saying crypto-related assets activity requires oversight, and then it's from the Federal Reserve and Bank Supervisory Plans to work with other regulators to ensure that crypto activity inside banks is well regulated. He said it's committed to a safer and fairer banking system. Courtney? Thank you. Steve. I have a question, I guess, the residential real estate weakened noticeably. And that one stands out to me because I know so many recessions or economic downturns have a very important real estate component.

And the weekend noticeably stands out to me. What do you think of this? Well, it stood out to me, too. That was one of the more, what do you want to say, demonstrative comments in the Bayesian? I'm trying to see if there's any other detail around it. Not that I'm seeing here. Residential loan demand was weak amid elevated mortgage interest rates here. Commercial real estate also softened.

But I'll read you what it says. despite some reports of strong leasing activity, residential real estate conditions weakened noticeably as home sales fell in all 12 districts and residential construction remain constrained by input shortages. So there's two parts to that story there, Courtney. And you're right to focus, I think, on what's happening in the housing market. We had several analysts on our air describe what's happening housing as a recession. It doesn't appear as if the rest of the economy right now is in recession, but of course, autos which were muted and housing are two sectors that are often pointed to as the most interest rate sensitive. Yeah, I find that very fascinating, Stephen.

And then very quickly here, before we let you go, solid leisure and hospitality activity, as we talk about sort of returning to normal, it does look like people are still going out and about, and that's where perhaps the consumer is spending some of their money. Absolutely. There was an interesting comment in Lail Braynard's speech this came out this afternoon around 1240, that said service sector spending is still four or five percent below where it should be pre-pandemic, where as goods sales are five percent above. So there is still a major adjustments we made in this economy, Courtney, towards the service sector and away from your favorite, Courtney, the good sector. You know it, Steve. Who doesn't love a good shopping trip?

Thank you very much. Sure. Well, let's get to another big breaking story of the day. Apple unveiling a slew of new products, including a new watch series and a new iPhone. phone. CNBC tech reporter Steve Kovac has the rundown for us. He's live from Cooper Tino. Steve, what do you got? Hey, Corey. Yeah, Apple just wrapped up. It's a rundown here of the iPhone 14. This is the regular model. In fact, I'm watching right now, they're just about to unveil the pros. But as far as the 14 goes, it's going to come in a new size. They're calling it the iPhone 14 plus. That's the size of those bigger max models on the pro side that we've seen for the last few years.

The mini is gone. That's going to disappoint some people. Instead, they're favoring that bigger screen. And then the cool new feature they're really highlighting this time is this satellite SOS feature, meaning if you're in an area without any cell service, the phone can help you detect a satellite in the sky and send either a message or a voice memo to emergency services if you need help. Those are the big things. On top of that, the AirPods Pro, the new version, the first time they've had a new version of the AirPods Pro since the original launch. Better noise canceling, better battery life, but overall pretty similar to the current version, just a minor iterative upgrades there. And then like you said, Apple Watch is the big one being that Apple Watch Ultra, an $800

watch catering to extreme athletes who like to go mountain climbing and diving and walking through snowstorms or whatever other extreme sports. That's going to be quite a niche product, but they did spend a long time talking about it, Court. So talk to me a little bit about Apple's move to this, to a bigger form factor, bigger size. on the phone. For a long time, Apple resisted that. Samsung got it out in front of them on it, and then finally they played a little catch-up, and now it seems like they're moving completely away from smaller-sized phones. Yeah, that's right, Taylor. They've kind of seesawed on this back and forth over the years, going from big to small, big to small. But overall, people prefer

the larger-sized phones. They're, of course, a cohort of people who do like the smaller phones, and they still have that iPhone SE, which is the more traditional size with the home button, if you're into that. But for everyone else, the newest, latest and greatest iPhones are always going to be those bigger sizes, the regular, more sensitive size,

and then the biggest size, which approaches seven-inch screen, Tyler. Very interesting. Steve Kovac, thank you very much. What do you like, Gordon? Do you like a smaller one? I like a smaller one. I need bigger pockets then.

I also... I miss buttons, and you have to have a new... The headphone jack I miss. I'm old-fashioned, though, you know? I like buttons. Tactile things, smaller things. I don't need this gigantic phone. Anyway, I guess other people do. Thanks, Steve. Our next guest has made some bold calls on Apple on August 17th. He said, sell it all. Since then, the stock is down about 10%. If you didn't listen, and he still own it, he says, okay, now hold it. So what do the chart say? Let's bring in Carter Worth. He's founder and CEO of Worth Charting. That was such an interesting call, timed perfectly, Carter. So tell us what you're seeing now. Well, thanks, Courtney. And again, we could be here talking about a dud, so grateful that we're talking about a winner.

Listen, I think we are all wanting always to find inflection points, right? Whether you're doing it from a fundamental point of view or a quantitative point or a technical point of view and trying to say, wow, this is at a bounce juncture, this is at a breakout juncture, or this is so bad it's good, or this is too steep, let's fade it, trim it. Apple's not really in any position. And I think, while that sounds like non-advised or no. wisdom, I think there is a bit of advising that statement in the sense that what do you do with a stock that from its June low to its August high goes up 36%, which Apple did versus the market up 19, and now is sold off, you know, 12, 13%. Okay, so if one happened to short well or trim well two or three weeks ago, it's a little bit late now to be trimming or selling. And yet just because it's down 12, 13 percent, does that mean we should be buying it? Not really. Meaning, sometimes you're not at a great juncture, and I would say that's the piece of wisdom that I might be able to offer on Apple. It's not a particularly good short or along here. After advancing 35% off

its June low, almost double the S&P, it's now given back 12, and it probably is where it belongs. I know obviously your focus is technical, but we are having you on specifically today, not only because of the timing of your call, but also because of this big Apple event, typically around big product announcements. Do you see the stock move much? Apple's only up about three quarters of a percent today. Well, that's right. I mean, and it's not, again, it's not really anticipating anything about the news. And the news is, as people say, it's not a surprise anymore, right? The product cycle for Apple and the new features and gadgets, just for what it's worth. I'm like the smaller ones, too. I'm with both of you. But let's just say this, that it's such an important stock at 7.3% of the

S&P or consider this. Its total market cap at $2.5 trillion is awfully close to the entire Russell 2000. All 2000 stocks are $2.9 trillion. And really, Apple's streak higher, advance the market, and its sell-off also is what precipitated the market sell-off. It's sort of fair money, dull money here. So walk me through once again, the if I own it and have held it, what to do? If I don't own it and I'm terminally interested.

in it, what to do? If I shorted it, what to do? Take me through the steps. Yeah, let's, I mean, you know, there's no fixed answer, but I would just say this. If one had shorted two, three weeks ago, dumb luck or brilliance based on whatever or maybe a chart, I think I would cover that short, meaning take the money and run. If one had trimmed, okay, good trim, so forth. But here and now, does that therefore make it a buy?

No. So if I were on the sidelines, I would stay. on the sidelines. If I had shorted, I would cover the trade, come out, and just call it a win and stay on the sidelines. Now, the Wall Street word for all of that is a hold. But remember, hold is a euphemism for sell. Only 5% of all stocks covered are sell rated. There's a reason for that because typically big brokerage firms don't want to offend the companies in the IR department. They won't get invited to the junkets and to the bus tours and the factory tours. And so an analyst doesn't like a stock, they say hold, wink, wink, wink, sell. Very few people put sell rates.

I don't think it's a sell here either, but I don't really want to hold it. I'd just rather have my capital somewhere else. Very interesting, Carter, telling it like it is. Carter Worth, worth charting. Thank you. Always worth seeing you. All right, coming up, the FX effect with the dollar index at its highest level in two decades. Which stocks should you avoid? Which should you load up on? plus the NASDAQ on track now to snap a seven-day losing streak. It's first of those since 2016 are the charts pointing to a breakout or a breakdown. We will get another technical take. And before the break, a look at some of the stocks hitting 52-week highs in today's session,

including N-phase, AES, and genuine auto parts. Welcome back to power lunch. Strong moves in the dollar have sent the greenback to multi-decade highs against the yen. the euro. So how do you trade stocks and invest with such wild currency swings or a strong American currency, the likes of which we haven't seen in decades? Boris Schlossberg, managing director at BK asset management. CNBC contributor will explain all of this. All right, what I want to start with is sort of a generic question. As you look at all of the stocks in the United American stocks, what kinds of stocks does a strong dollar like this help? What kind of

of stocks, does it in theory hurt? Well, the basic assumption is anybody who sources in dollars and sells in non-dollar, sells in euros, sells in yen, pounds, it's going to get hurt on currency swings. Anybody who sources in euros or yen or pounds or emerging market currencies or even the yuan and then sells in dollars definitely gets a benefit. That's sort of the underlying assumption of how you want to look at the whole stock universe in terms of FX effect. So if I am an American company selling in euros in France, you're in trouble. I am in trouble because I am not going to be able to repatriate those euros

into as many dollars as a few months ago, correct? Oh, just yeah, massively less. Massively less. All right. So we've got some individual names that you say, will benefit from a strong dollar. And they include LVMH, which is obviously not a U.S.-based stock, but Apple and I guess EXPEE. Is that Expedia? Expedia, yeah. Tell us why those. So, okay, let's start with LVMH, luxury European retailer. We all know it. It has tremendous amount of sourcing in euros, designs in Euros, also sourcing, I guess, in the U-W-W-1. It sells in Europe, China, and the U.S.

The U.S. market is very strong. This is a company that's 20% off its highs, but the demand for its product cycle is very robust, and it's really, really almost recession proof of these levels, simply because the upper end of the market really isn't feeling any of the inflationary pressures or any kind of income declines that we're seeing maybe on the lower end of the market. So for all those reasons, I think it's going to really survive and probably thrive in this environment quite well, while at the same time benefiting from a very, very nice currency play on it to its end, currency edge to its end because a lot of its sourcing is going to be in euro, so therefore its labor

costs will be much cheaper. So I really do like L'A M.H. There's also sort of an upside kicker here. It's gotten very badly hurt because of the COVID lockdowns in China. If you sort of assume, and this is obviously a speculative bet, that if President Z gets reelected for the third term, once that happens and he consolidates his power, the COVID lockdowns may become a lot less onerous. That obviously opens up the whole Chinese market.

And it's kind of like putting a beach ball underwater. They should really pop on that news. Now, Apple, I absolutely love, and I think one of the most under-told stories right now, one of the more hidden stories, is that Dollar China, Dollar Yuan, is almost at seven. It was 10% more just in April. In other words, it's 10% less, 10% cheaper for April for Apple to be. paying all of its labor suppliers in China. That's a huge, huge tailwind for the company.

Not to add, and I know you had just the guest on who was sort of neutral to the negative on Apple. I'm actually very bullish Apple. The cycle is very strong. This whole satellite announcement, I think is going to make the 14, even a stronger desired phone. So I think, you know, Apple is proven to be a very strong, robust stock. If all of these effects have positive effect, it's going to go to a $3 trillion company. Quick thought. Finally, Expedia. Quick thought on Expedia, Boris.

Quick thought, and then I want Courtney to jump in, just generically on stocks to fade. Sure. Expedia is basically a bet on the travel boon out of the United States. The U.S. travel rush to Europe now with the euro under a dollar and pound, possibly heading to parity, is really creating huge amount of bookings. They're like double, almost close to triple-digit booking increases, and I think that trend stays in place. So they're going to be huge secular beneficiary from the strong.

dollar that way. So, Boris, I have a two-prong question. Tyler's right. We want to know the stocks to fade. But then a lot of these companies, of course, are operating internationally. So if we're sort of doing our own homework on this, do we need to look at the regional breakdown, how much business is being done where versus how much business is being sourced where? Because it's not just as easy as sourcing in one place and selling in another. It's all interconnected, is it not? And then tell me very briefly about your stocks to fade. Exactly, which is why I'm cautious. And it's not even so much of fate. This is a true holder where I love these companies, but I just would not want to find them right now. And two, the Mondalese and Coke. Coke, 66% of its revenue outside of the

United States. You know that's going to hurt. Plus, Coke's growth has not been organic. It's all been from price increases. They haven't had any kind of organic growth for quite a while. So the stock is very expensive to 25 PE. To me, that's just a dangerous place right now to be placing your faith in the consumer outside of the United States kind of rescuing Coke. Mondalise, the same kind of thing. great company, great execution, great portfolio set of snacks, but also close to 40% of it in Europe, that exposes it very, very badly to the European consumer. Now, for now, the European consumer is more or less okay. But if we take the worst case scenario, very, very cold winter, and we have kind of the worst

kind of post-war recession in Europe, we could possibly imagine, nobody's pricing for that scenario. That's why I want to be cautious. I want to stand back from those two companies that could get tremendously badly hit if the European consumer collapses completely due to the pressures in the Eurozone. Got it. Okay, we got a little bit of an education. And just as a reminder, stocks to buy you like LVMH, Apple Expedia, perhaps a little bit more cautious on Mondalese and Coke with the dollar at these highs. DeVoroslashburg, BK asset management.

Thank you for joining us. Nice guys. Well, coming up, iPhone profiteers, Apple announcing its new phone. But third-party sellers are already overcharging on the gray market. Plus, we'll take a look at a startup planting tracking chips in food. in order to help reduce waste. Power lunch. We told you that Apple launching its new iPhone 14 and iPhone 14 plus just a few minutes ago. But in China, phone scalpers are already prepared to start flipping the phones for a huge profit. Unisun has that story live from Beijing.

This market is in Zhongguan Sun, Beijing's Silicon Valley. People come to places like this to have their phones fixed and be among the first to get must-have gadgets. Wang Qi has been selling iPhones here for 12 years. The gray market seller says his orders for the iPhone 14 are double when the 13 launched. Most in demand, the 14 Pro Max, with 256 gigabytes for storage in purple. Mr. Wong is already in touch with scalpers, who he says will start waiting in line from early morning. He's offering to pay them $150 for every phone they bring back. He plans to charge $450 over the $1.50 over the phone. the retail price, a tidy profit for him of $300 per phone.

In the past, buying an iPhone was about bragging rights, he says. Now it's more about performance. He says for the 14, the faster A16 chip is a selling point along with its 5G. Even though rival Huawei rolled out its new Mate 50 with Chinese satellite technology meant to get around US 5G curves. The market still favors Apple right now, he says. So Wong is counting his blessings and his cash. iPhone 14 is the top trending topic right now on social media in China with 120 million views.

And unofficial vendors told us that the plan right now is to make sure that the scalpers are outside of Apple stores next Thursday so that they can deliver the iPhone 14 to their customers by next Friday, September 16th. Guys? All right, Eunice, thank you very much. Eunice Yunn, reporting from... Beijing. All right, let's get to Christina Ports and Avalos for a CNBC news update. Christina. Tyler, and good afternoon, everyone. Within the last hour, a judge struck down Michigan's long, dormant 1931 law banning abortions because it violates the state's constitution. Separately,

Michigan's Supreme Court is deciding whether a proposed amendment guaranteeing abortion rights should be put on November's ballots. Also, since our previous news update, just an hour ago, the official portraits of Barack and Michelle Obama were unveiled at the White House during a ceremony hosted by President Biden. In the past, unveilings like this have been held during the next president's term, but it didn't happen while Donald Trump was in the White House. And just one day after officially asking Liz Trust to form of government, Queen Elizabeth has canceled a ceremonial meeting of her Privy Council, part of the transition to Britain's new prime minister. Buckingham Palace says the 96-year-old monarch has been told by doctors she should rest. Tyler, back over to you. Christina, thank you very much.

Thanks. A head on power launch, a losing average. The NASDAQ positive today after seven negative sessions, we will get the technical take to see what might happen next. Plus, with fears over a rough fall for stocks, what are some good low volatility names for investors to consider? Well, that's in today's three-stock length we've got for you. 90 minutes left in the trading day. We want to get you caught up on the market. Stocks, bonds, big move in oil, and a look at what the technicals are telling us about the NASDAQ.

So let's begin with a check on the market. Stocks are higher today. The Dow gaining about 400 points near the highs of the session. The NASDAQ up 2% aiming to end a seven session losing streak. But if you look at the biggest gainers in the NASDAQ 100, it's not so much tech, retail, and health care at the top of the list. There you see Starbucks, eBay, Regeneron. And the best performing S&P sector today is utilities of 3% and only one of two sectors, along with energy, which are higher so far, this year. Apple's product event is just ending. That stock is higher on the session. We got a new

iPhone 14, which will start at $799 bucks and a new series of watches. Now to the bond market, which is digesting the beige book and some hawkish comments from Lail Brainerd. Rick Zandelli joins us from the Windy City. Hi, Rick. Yes, well, hawkish comments. I think that would be news only if it was doveish comments, especially since August 26. And that's where we're going to start all of our. charts. Let's look at August 26th two-year note yield and we could see that it was around the mid two-thirties not three-thirties not so far from where it is today the chart is mostly sideways now think about what the beige book said

weaker growth elevated but lower pricing pressures that seems to be what the markets are thinking especially since Chairman Powell's speech look at a tenure that's where all the horsepower was basically from 3% it shot up close to 3 and a and ease back. And remember, yesterday's close was the first close in a two year above three and a half percent in nearly 15 years. And the markets seem to be taking a bit of a breather. Look at all that green in the equity markets. Now let's look at the five-year break-even inflation rate. It's near a two-month low level in the mid-260s. And since that Jackson Hole speech, tends to twos have been less inverted significantly. And finally, the dollar-inverted. went on a record trading binge that pretty much started that last wave right around the 26th of August.

And even though it's taken a bit of a break today, it really does underscore the notion that Leo Brandeard and all the hawkishness and especially Chairman Powell's speech on the 26th left a lasting impression on the market. The key now is what the data points are going to continue to show. Courtney, back to you. Very important when you're data dependent. Thank you, Rick. Well, oil closing for the day down 5%. Pippa Stevens has the details for us. Hi, Pippa. Hey, Courtney, heavy losses across the energy space with WTI tumbling to the lowest level since the end of January. And global benchmark Brent crude breaking below 90 bucks for the first time since early February. CIBC Private Wealth, Rebecca Babin said this all comes down to three key factors.

First is demand fears as China extends its lockdowns. Second is technical pressure with WTI below 85 and Brent under 90. And finally, headline exhaustion that's leading to low conviction trading. There are still so many factors up in the air here, including the Iran deal as well as potential further retaliation from Russia. Moving to natural gas where prices are also lower, both here and in Europe, with the European benchmark down 12%. These energy declines are weighing on oil and gas stocks. group is down more than 1% and is the only group in the red. Courtney, back to you. Thank you very much, Pipa. Yeah, a lot going on there with WTI down 5%.

Well, the NASDAQ are racing yesterday's losses on pace to snap. It's for seven-day losing streak since 2016. But with September, being on a historically cruel month for equities, could the markets retest the June lows? Here with her technical take is Jessica Inskip. She's director of product at Options Play. Jessica, what levels of resistance or support are you looking at here? Yeah, Courtney, right now we're looking at 11,600, and that's a very important level. So when we think about the markets bottoming or those June levels that we're watching, that level is actually its old resistance point.

So old resistance becomes new support. And that's why it's ever so important right now that we hold that support line. Otherwise, we risk moving into that lower end of the trading range, which would then likely test those June lows. So it's a very important point right now. How does seasonality then play into your outlook for what the technical charts may or may not be telling you going forward? Yeah, seasonality is extremely important when you're thinking about technical analysis because it's the study of charts and patterns. And then I love layering on other events on top of seasonality just to see what happens.

So traditionally in September and a midterm year, it's extremely challenging. And that's even heightened with the August that we had. So that is ever so, ever so challenging. Something that you have to take into account, though, when looking at seasonality, all of those numbers that we share in most of the market is, is back dating from 1928. And if you think about the markets and how they've transformed and the introduction of technology, that's why technology is a little more prevalent when thinking about seasonality. So it's not something to fully rely on, but it's a good way to see how we're set up and another layer to your process.

You say we've had a bare market rally, and I wouldn't disagree with you at all, and it has been tech led. And then as it has faded, it has been tech led once again. What kind of price action would you like to see to convince you that the market is not just in a bare market rally, which suggests a temporary rise, but in something more enduring? What would you look for? What would the signal be? Yeah, so it's not traditional capitulation, and I think that's such a great question, Tyler, so thank you for that. It's a little more gradual. So we're looking for that gradual signs of capitulation, if you will, or just turning over in general. So that's where I like to turn it to Apple at this point, as it is tech led up or down, if you will. And there are a lot of macro headwinds, and I want to see those ease off. And one of those is actually energy, coming down. So thinking about CPI, that's about to come out because if you look at the data for CPI and you dive into the actual transcript, it was flat because of the coming down of energy prices, but the housing index actually rose up a little more, including electricity bills and things like that. So that's something that's a concern. If we see energy come down, I don't want, dare I say, the Fed just be lucky and demand destruction is still playing its part. But that's, it's all the macro headwinds easing up, if you will, which we've seen, but we need to make sure

there's enough data to support that. Well, I'm ready to capitulate. I'm good. I'm capitulate right now. I'm interested in how Apple plays into all of this when you're looking at technical analysis. Obviously, it's a big day because of the announcement of their products. But Apple carries a lot of weight in a lot of different market products. So when you're evaluating really technology in general as a sector or perhaps any ETFs,

How then are you looking at following Apple's trend line against some of these other stocks? Yeah, Apple's the leader, the line leader, if you will. So we need to take that into account because it makes up a huge portion of the market. From the tech-wise, if you believe it's about 13%, and then it makes up 7% of the S&P 500 overall, that's a huge percentage that represents the market. So it has the power, it is the line leader, to move markets in either direction, which is seen today, and you can study that over time, but it's important just to watch the levels of Apple

because it is a tech-led rally or a tech-led decline. So Apple can give us an indication from that narrow view that we then can brought into the NASDAQ and then brought into the S&P to give an indication of overall market health direction. Got it. Well, thank you, Jessica Inskip, of Options Blake. We appreciate you being with us. And, yes, thank you very much, Jessica.

After the break, the big money behind a company that puts tracking chips in everything from food to pharmaceuticals to help reduce waste. Clean start is next. Diana Oleg is in the house. She'll be here in just a moment. Welcome back to Power Lunch, everybody. Food waste accounts for about 8% of global greenhouse gas emissions. In the U.S. alone, it is equivalent to emissions from 33 million cars. But what if we could reduce that using something as basic as Bluetooth? tooth. Our senior climate correspondent, Diana Ollick, joins us now with the latest in her series

on Clean Startups. Welcome, Di. Well, hey, Ty. Yeah, and you may have heard of the Internet of Things IoT. It means items that are embedded with sensors or software. And in the case of this startup called Williott, its tiny tags attached to food, medicine, and other items that track every aspect of their lifespans in order to reduce waste. It's this ability to drive a very lean supply chain with only just the right amount of products that are in the right place at the right time, which we think is one of the keys to solving climate change. They do it with these stamped size computers powered by Bluetooth and attached to any product or packaging from vaccines. It allows us to measure the temperature, the location, the authenticity. To zucchini.

Each zucchini that goes into a crate joins a unique monitoring. path. Smart crates monitoring everything moving from farm to fork. Williott is working with label giant Avery Denison, which is manufacturing millions of these tags and connecting them to the cloud so they can be tracked anywhere, anytime. By knowing where a product is, what's happening to it, where it's from, you can act faster. And so it's about taking data and turning it into actionable insights. Insights that ultimately work to decrease waste by monitoring delays and shelf life. Williott is seeing massive demand as the makers of just about everything strive to reduce their carbon footprints. Last quarter we quadrupled our revenue and I expect when we leave this year, then that growth will be on an even steeper trajectory.

Stattler says clients include some of the largest pharmaceutical, apparel and grocery companies. Backers so far, Avery Denison, Verizon Ventures, Amazon, PepsiCo, Samsung and SoftBank. Total funding, $270 million. Not only can this technology reduce waste, but it also enables companies to quantify far more accurately their carbon footprints from the point of manufacturing to consumption. And that'll be really helpful for corporations as new regulations on emissions are clearly coming, Tyler. These tags, they tell you where the product goes.

Is that really the heart of it? They absolutely do. That's the whole idea. It can, you know, whether it's a vial of some pharmaceutical or a vaccine or a zucchini, it tells you exactly where it is, what the temperature is, how long it's been there, and that, again, will tell. And what is the nature of the sensor that picks up all of this data? Well, it's Bluetooth. I mean, I want to say it's high technology, but it's not. Is Bluetooth on my phone or in my house?

Right. Yeah. Okay, fine. And then that gets transmitted back to some central cloudishness. Exactly. And how much is it cost? I mean, are you tagging every single zucchini, every vial? Well, that is, of course, proprietary information.

But the companies are willing, of course, to invest in it because it's going to save them money in the end when they have all this waste. If they can tell where that zucchini is and if it's not going to go bad, that's going to save them money. Got it. Cool. Okay. Very cool. Thanks, Di. Thank you. Nice to have you here. Well, still to come, finding a cushion for the fall. We're trading some popular low volatility names in today's three stock lunch.

That's next. And to look at the markets right now. Down at Session Hise. In today's three stock lunch, we're taking a look at some names that might outperform. with lower volatility. CMBC Pro ran a screen of the highest rated stocks from the MSCI minimum volatility ETF. Those names include,

Schneer Energy, up 55% this year, T-Mobile, up 25% this year, outperforming rivals, AT&T and Verizon, and United Health, one of the few Dow components higher on the year. So let's bring in Ari Wald. He's head of technical analysis at Oppenheimer to go through each one for us.

Let's start with Schneer. Yeah, Courtney, you know, first off, important to kind of lead in that we are of the view that a market bottom is forming. I think you get the upturn once seasonals improve in the fourth quarter. So I think it's important when looking for low volatility exposure, trying to find ideas that should be able to keep pace in a strong market backdrop, or at least those ideas that have historically kept up in prior bull market periods. So we have identified three names from this low-vol E-TF. The first one is Chenier. You know, first off, we think the energy sector is an attractive portfolio diversifier that's been less correlated to recent market swings.

And when looking within that sector, Chenier, Ticker, LNG, is really best of. It's one of the few stocks that not only was able to rally above its 2018 peak, but it's 2014 high as well. So we see that as a sign of long-term secular strength. More recently, the stock is correcting into its recent March peak. that comes in at $149. We recommend buying the pullback into that support level. All right. Let's look at one of it.

It seems like it's on everybody's buy list, and that's T-Mobile. Right up there with Ulta, but T-Mobile is one of the frequent names. Stand out in the telecom space where you have bearish trends in AT&T and Verizon. Again, T-Mobile, best of. It provides low volatility exposure to the NASDAQ-100. Again, I think the NASDAQ does have some better days ahead after really feeling of brunt of this decline a year to date. So when looking at T-Mobile, I think what's most notable is the stock is already out to a new high on a relative basis versus the market. What that indicates to us is that the stock is positioned to break above its prior high at $150, once market conditions firm, and that headwind is taken away. And so we do see additional upside.

and pre-breakout potential for T-Mobile. And United Health, this is another name, like Tyler was mentioning about T-Mobile, that I do see pop-up on a number of folks lists. What do you make of United Health here? Really, just the steady eddy, just been in a long-term uptrend continues to grind higher. I think managed care, speaking in terms of the industry,

has been one of the stronger pockets of the health care sector, best of the sector. And I think United Health is one of the, you know, one of the stronger charts and best of that managed care group. So it's a stock that has paused below its April high at around $550. Some may see a double top. We see a pause in an uptrent. I think as long as $500 support is intact, that's the stock's 200-day average. I think it's just a matter of time before United Health breaks out to the upside once market conditions affirm, possibly in the fourth quarter. All right. Erie, thank you very much.

Jerry Wald. We appreciate your time today. All right, up next, Bitcoin bouncing back this afternoon, but not before crypto price is cratered. We'll put the moves under the microscope with the man who can bust the moves. That would be Dom Chu. Bitcoin slightly higher right now, but early today falling to the lowest level since June, Dominic Chu, putting the Bitcoin price action now under the microscope. Dom. So the reason why we all care about Bitcoin is it is far in a way the biggest influence on the entire cryptocurrency market. And just to put things in perspective, with the latest stats,

according to coin market cap, these are the five biggest coin slash tokens out there, tethered down at $68 billion, BNB, which is part of the Binance ecosystem, 43, Ethereum, you can see U.S. dollar coin 52, but Ethereum and Bitcoin, these two right here have a huge amount of influence over what happens with the entire crypto market cap. So with it being back under that $1 trillion mark at one point earlier today into yesterday. If you look at Bitcoin's price right now, the lows that we're talking about are right here. And the level that you want to watch is right around 18,600. That's the kind of area we want to keep it out.

And for Ethereum prices, again, about 67% below where we saw on the records, that's going to be one to watch as well. It's just above its 50-day average price right now, guys. All right, Dom, thank you very much. You got it. Telling you about the woes in the crypto world. Thanks for watching Power Lunch, everybody.