U.S. stocks closed near session lows on Tuesday, as investors monitor rising tensions between Beijing and China.  The markets closing lower to start August also comes after the major indexes finished their best month since 2020. The Dow dropped 0.9% on the day, while the Nasdaq and S&P 500 falling 0.5% and 0.7%, respectively.  Erin Gibbs, Chief Investment Officer of Main Street Asset Management, joins Cheddar News' Closing Bell to discuss.

Closing Bell

U.S. Stocks Close Near Session Lows

let's turn back to the major indexes. We did see a lower market today stop sending near their session lows the dow underperforming after a disappointing day from caterpillar down 1.2% the S and P off 7/10 of a percent and the NASDAQ lower by 2/10 of a percent. So joining me now is erin Gibbs, chief investment officer of Main Street Asset Management. Aaron, thanks so much for taking the time this afternoon. A different story that we've seen this week, fractional losses for the major indexes after a very strong end to july what's behind some of the recent trepidation, I think a lot of it is uh, investors reacted very positively to the Federal Reserve's comments last week. Um, and certainly there was a lot of positive sentiment and human companies were missing. We actually still saw stocks going up and I think that now specimens has gotten much more cautious. Um, and even today for a large portion of the day was very much the defensive stocks, it wasn't tech stocks, it was back to utilities and energy. Uh, and I think that investors are much more fearful of a recession and we see that within across the Treasury markets with the european curb and became a little more inverted. Uh, so that being an indicator of just how much recession is on everybody's mind and it might be for, you know, several weeks to come. So what are you watching to gauge whether or not we are in a recession, I know we had gotten that disappointing second quarter GDP print just last week, which did show that the technical definition of a recession was in place. Um Even though biden administration officials saying otherwise, yes, so that is a technical recession, that's the definition. And I think with the bottom markers indicating right now is that there's definitely here is that it would be prolonged. So rather than just being um what we like to call it techno recession of just two quarters very quick, which has happened many times uh that this might be, you know, four more quarters going into the next year. Um And so I I think obviously the jobs report is very good Because that's really what's been holding us up despite high inflation. We've had low unemployment. So that's certainly important. But another thing that I'm looking at is earnings guidance as we go through this earnings season. And for me looking at how guidance and estimate growth has really come down in the past month and basically growth for the second and a half year was just a month ago, was expected at 10% And now it's expected to be more like 6% on power for the S&P. And you know that that potentially could be even lower than the rate translation