Closing Bell: Navigating an Indecisive Market 11/19/24
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While computer closing balloon mix sand tally info Scott walter, this make a break hour starts with stocks finding their footing after overnight geopolitical headlines had the indexes warbling into the open. Please look at our score card with sixty minutes to go in regulation S P. Five hundred, bouncing ing all of its post election low this morning.

That was the level at at a couple of times in the last week or so. You see IT up about only about a quarter of a point right now, down two thirds of a percent at the loss. The giants of the nasdaq have been catching a bit.

That's been driving the last hired by eight tense in video. The biggest upside contributor to the S A P. By far, about twenty five hours ahead of a turnings release, renders a verdict on the overall A I trade.

You see the video of four and a half percent right now. Mix signals on the consumer with more are running to a new high on strong results and guidance, while the weak housing starts number and a software quarter from lows pressures, housing related names. Now both the ten year treasury al, then the U.

S. Dollar index backing away from the top of their recent ranges takes maybe some of the pressure of faculties, while the S P, five hundred does harvard below its closing level from the day after the election. So that takes us to our talk of the take.

What are the key forces now that will tilt this index SE of market one direction or the other here to help us enter? That is so as alternatives, management and Green say that, thank you having me, sir. Sure thing.

We we've obviously been a under the surface of this market, but in aggregate, we've kind of been on hold for about a week and half as I guess we try to get some clarity on a few things. Are any of the reactions after the election or even just the trends before that? Um did they seem overplayed in the short term as I feel like the market hasn't roughly right here? Yeah, I I don't think .

anything been overplayed. I mean, we obviously don't know exactly what policies are you going to be implemented. We don't know when the tarrifs h any, any larger trade war items, any additional tax cuts beyond in the extension of the T C G A.

So there's a lot of uncertain here. I think obviously, markets should have valid in the wake of the election. Obviously, that's the most business friendly environment you could hope for the the red wave sort to speak, but and some digestion of that given where we were not the worst thing in the world. I mean, obviously, the markets have gone straight up, both equating credit for some time now. So we going to have of trading sideways.

hardly the worst thing in the world. yeah. And I guess, again, I keep coming back to the point at the starting level in many ways was just not as if you know we were springing ready to spring ahead right a lot. You pull back a little .

bit come into the election. People had degroof. We knew this across the street. Hetch funds had taken down growth exposure, even net exposures a and so you had everybody have to rent back up after the election. And that's why you saw in small caps, midcap and other election related place such a strong post election rally. Now that we've settled in and we have a Better idea that the red wave is indeed the thing the house obviously has called, we can take a bit and digest and see the cabinet appoints and the likely path for policy.

The thing that IT absolutely does though IT IT really focuses maybe an excess of attention on these individual possible impacts. I'm just wondering the pharmacy tico sector as a whole is down twelve percent in a month. Food stocks getting blasted because of what might might not happen in terms of food and greedy and everything. You know, with all the headlines and you know as as was just being set in two IT getting slammed today on the hint that we might have know a free way to file our taxes IT just feels as a lot of these this twitchiness in the market is a is a function of people thinking like this should be a policy driven market.

Whether or not I listening to probably will be R F K, H H, R F K, H S H S S could be a game changer. There's no doubt about IT, and I don't want to speak to the validity of that. Mean, the vaccine makers being down as seems as a starting point of a safe bet to make. But this we have to see exactly what involved. I highly doubt the way government Operates in a scaroons malaya type way makes IT very difficult for anybody be at elon in the deck, on the outsider of k on the inside, to rapidly affect whole cell change.

But but will say, but I will say that the idea that you would have these adjustments in a number of names, not just in health care, but on the positive side as well, really is I would are you justified? Because in many respects, the incoming administration is going to be the hope is that it's gonna a game changer. And if IT is, then a lot of these plays have have much more room to rally.

I will add though, when we talk about the market as a whole, there's a lot going on. That's not just technology. That's not just policy.

You have uh, united rentals doesn't stop going up. Obviously, that's about the broader economy. You've got continue with the industrials. You've got a eaten train technology, how md, then they're not all the same, but they keep going up. There's any of different slices .

of the market. The metal feels like data center built out well.

yes, I mean eaten and the h backways or a cynos AI. But even beyond that, the the O T S method X I am obviously that's that's a technology name, but it's super name. There's any number.

Listen to the S M P S, up twenty five percent year to days, called called twenty five percent. There's two hundred stocks, one hundred and seventy five stocks, whatever is that are doing Better than that, that up forty five or fifty five, sixty percent. And they are not all A I. They're not all policy driven plays. There's a lot otherwise going on.

I do wonder if on the other side of that, I mean, whether, in fact, people are taking the right of the ball. The house starts number was weak. It's been a weak part of this economy for a little while. And in this may be a little bit of a test of whether that part of the economy can handle seven percent mortgage.

Yeah, I listen. The builders are all off. What told brothers is not, but the the builders are off highs.

And there we did get the sentiment number today, which tends to track with activity and and IT was and he was and it's doing well. I think it's about seven month. The buildings have had a terrific run. More gage rate to seven percent is obviously less optimal than mortgage ate to five percent. But at the same time, I think that we've entered something of a steady state here.

When you listen to what the villages have to say on the calls and on the the regional data that comes in from the non public builders, IT seems like they're still demand there, even in seven percent mortgage tes. How much of IT is on the hopes step in the next year? Mortgage rates tes are closer to six percent and seven percent, I can say.

But in general, builders have have proven that they can be successful in an environment of higher interest rates. Demand is there not as much as we would like, obviously, but based on the stock Prices, obviously, they are telling you they're been successful in managing in this environment the fact that rates have not come down as quickly less optimal, but they're still doing OK. sure.

Let's bring in more sea. Gregor of moral and bank of america, private bank and brain talking ten of recorded capital management but of course A C N B C contributor and and Marcy, let me just get to you because I imagine, you know, in the lead up to the election, as you talk to clients, the message is typically, look, don't really let the election result, whatever IT might be, dictate your investment strategy. And yet we're in this moment where IT seems like that is top of mind for everyone and IT seems like it's what's animated the market. How should right now an investor think about the policy inputs and then just the broader set up for investing?

Yeah, absolutely. I keep telling our clients with a broad market, it's not about policy, is actually about corporate profits because in my view, when we look ahead to twenty twenty five, that's the number one factor that has the potential drive market higher. Our view is all eleven sectors get to positive E, P, S.

Growth and join this party by spring next year. That made me a powerful force for the overall market. Of course, policy can drive rotations and can drive sector of views, but I think this is gonna a profit driven market when we think about twenty twenty five.

So less about multiple expansion. Maybe multiple are a little sticker next year. Um but really the market is driven by, in our view, the potential for you know low double dig for double digit profit gross.

And how is the the fed a kind of filter into that equation at all? If if IT does, if you feel as if the market can hold its multiple here, have earnings kind of do the work and presumably you know things like yells and inflation don't get out of hand.

yeah I think the risk here now on the policy side is that inflation appears to be a little bit sticker. You know we've seen C P I, M K, C E kind of stall out for the last few months. So progress on cooling has slowed for sure.

So I think the risk is now less bed cut, higher terminal weight. I would argue that's what the yield on the ten years is telling us right now. But the fed is so cutting, I think you probably have, you know call IT three more cuts in the offer here between now in the middle of next year.

So you still have a fed that's retaliation ating policy because the economy is strong, so they're cutting while profits are accelerating. That's a really unusual combination for Marks. I think investors should pay attention to that.

brin. Um you obviously involved broadly in the markets, but specifically in some of the the areas that really have started to run a bit hot, right mean crypto tesla, there's been a liveliness and certain part of this market. Is any of IT feel uncomfortable yet? Or is is IT just what you'd expect and hope to see um out of you know the the energy of this market moving in that direction?

I love your word lively. Ss, I think that's an understatement. I mean, I think there's definitely there's a lot of draw, a lot of speculation.

I think you're seen whether it's crypto specific of the cypher derivatives like a microstrip gy, the leverage strategies that are in etf, I mean, seen twenty thirty percent moves in a day. And so I think these animal spirits are high. I think there is some fundamental backdrop to that.

I think that when you have you know trump meeting intially with brian armstrong, and so I think a lot of some of the as I think uh, this deregulation is gonna be positive. But also like when tesla to me is up yesterday because maybe we're going to have some from national movement on autonomy. That's really not the has not really the issue of tesla right now.

Tesla, which I own needs to get their own autonomy, is ready to then go to get that license. And so I definitely think animal spirits are alive, alive. Well, I think we can have a rally into year in, but I do think investors need to be mindful that, you know some of these stocks do look quite piera olic after the election yeah .

that's actually another great example brain of of that kind of reflects move on some kind of a hint about policy with tesla and then uber on the other end of IT. And it's sort of you it's a trade first and then figure out the details later type of market, which I guess, by the way, bull markets always run through these phases.

sure. And I think that when you look at the the uber tesla pair trade, it's like these are both gna be winners. And this is where you see to mean more algorithm trading, hedge fund repositioning as an investor.

I think just because tesla is winning in no way should perform means uber s of losing. And so I think that this uber pullback is actually a good entry point. I just bought uber recently and then sold calls. And so I think that's A A, A good opportunity to take advantage from some of this algorithmic trading. That to me is just short term.

Yeah, i'm sure if you sold the calls before yesterday, good shape, that one. And then I guess the big picture really does all kind of line up in a favorable direction as we've kind of all been suggesting here. So create spreads crazy tight.

Obviously, earnings growth moving in the right direction. The fed maybe they do one in december. Maybe he doesn't matter how much more they do. If the economies going to a hang in there, let's go looking for something to worry about where ever you go.

So the funny thing you say let's go IT feels to me like for the Better part of fifteen years, there's people looking for something to worry about. There's an article in the journal today. It's all quiet.

I forget exactly with the stories, but it's all quiet on the credit card default rate, too quiet. Why is that a problem? My milliion credit spreads are extremely tight or eighty ninety bips and I G, wider and high yield, but exceedingly tight levels.

The financing markets are open, the economies doing. I disagree a little bit with Marcy, and I think with the consensus on on the rate cut path, december's probably fifty, fifty at this point, let's say they cut. I don't know that they get for next year or as marshy said, three by the middle next year.

The tarriff story, the immigration story has yet to play out. What effect that has in a macro sense remains to be seen. But you luted to even then, if we don't get the cuts that Marcy mentioned or that the markets expecting, I don't know that, that's the big deal.

And we mentioned early or all the different things that are working in the market, and we brought of tesla another one. But like, look at the office, right? I know josh Brown on the half was talking about cbr, pull up a charge of S L.

Green or verot. That is nothing to do with anything that we're talking about. I mention united rentals earlier, and there's a whole host of industrial and construction related names that are doing very well.

Some of that is data set of construction and some of that is just construction in general doing well. And and to the corporate profitability argument, I think this is the obviously the most important. I don't know that we get any additional corporate tax cut.

So when you look at what the financials did post the election, yeah, a lot of that is on the ema front, particularly the over over capitalization front of bazo. Three is at least held steady little on water down. A lot of these banks have have way too much regulatory capital relative to their market cap. But there's all these different place that, that can be put to work here, whether the fed cuts or not, whether the corporate tax rate cuts or not. And the market as a whole is benefit from it's been a couple months where we can say this.

It's not just I that's so just point out, I mean, I know you like say for fifteen years, we've been just kind of harping on the potential negatives. But in that fifteen years, you had two bear market.

had three other near bear market.

whatever the Price of the my point is uni couldn't see IT coming. I agree with that, yes. But the point is it's not always close your eyes and expect rating. No.

that that's fair. What i'm talking about is and we will use john paul son is the example yeah it's fell to me and i've express sed this on air previously IT feels to me like everyone is looking to be the next strong paulson and that's been the case or not real revenge for the last fifteen years.

And even when things you're doing well as they were different points in the twenty ten and they've been in the post covered environment, there's always people citing the worst particular outcome. Well, this random, the cap company said the consumers weak in, well, i've got walmart that continuously quarter after quarter tells me the consumers doing fine and you need like a million gaps to do one quarter of a revenue that costco does or that wall mart does. And as long as those companies are telling me everything's fine, I tend to feel with their fine.

And I would just said before, let you before let bring go look at the credit card companies. If there is something wrong with the consumer, pull up a charge of american express or capital one or or a vision master card. Obviously, there's no turbulence anywhere. We should just be able to say this is a pretty good environmental. What sectors will do Better, what parts, what industry .

is accept a of Marcy. Let's go into what parts of what h industries in particular on the big picture choices among us. First is rest of the world because that's a pretty clear, contentious and favorite, the us right now. And then you know is IT actually the broadening trade is are going to also pull in smaller companies this point.

Yeah, it's a great question. You know I think U S. Related to the rest of the world is a relatively easy call in my view.

I think you know when we see the profit cycle again, if that that I do think will still much forward and a strong economy every enforces U S. Competitive and attractiveness, especially with artificial intelligence really being a director in twenty twenty five and beyond. So when I think about what sectors drives the market, I like financials from here.

I think they're showing real market leadership relative hides that you go under the hood of the sector. There's a lot of new eyes um there. So I think that's a real positive.

They can benefit from deregulation and a strong economy. I like consumer depression ary as well. You know I would argue the consumers still showing solid amenta. My a friends had to be of a institute of their annual holiday survey and IT showed that holiday spending plans are up seven percent over last year.

So a consumer that has a wealth effect going on strong labor market paints a nice picture, I think, for directionally and the utilities, which is, of course, the A I ecosystem. I think, you know, technically speaking, small caps are showing some good signs of breaking out. I think we really need that profit story to come through.

I think great to say, a bit study from here as we look at next year, the ten year rate kids kind of testing resistance and coming back, I think that will be good news for small cats. And then finally, if I mentioned IT earlier, a merger and acquisition cycle benefit small cats too. So I do think they drain the party in a more sustained way.

And I think it's all about the U. S. Over the rest of the world in twenty twenty five.

all right. And brand brought us out here with a word on what you're expecting out of in video and also just how central that might be for the broader market or whether it's going to be kind of filter through a lot of .

other factors in video is the A I circuitry system, right? And we're all really clear, if you listen to amazon, google, microsoft, they all implied or explicit, said we're spending more, statists said during the earnings call, hardware cannot keep up with demand. And and so as a video in this A A A I circulatory system, I think you're onna hear about dell.

You're gona hear about what we're doing in NVIDIA about X A I. You know jensen likes to sprinkle in all these other companies that they're working with. And I think this is gonna another wonderful quarter that every everyone already knows that the the rate of beats are slowly I don't think that's any new news.

The markets pricing and plus or minus seven percent. I mean, video is basically at an all time high here. So there's definite a lot of optimism going into the print tomorrow. But if you take a step back, this company is still just eating everybody else as IT relates to the AI space.

Yeah so IT is basically at all time high, although interestingly, IT really has been sideways for a few months to see if that you know ends up having gathered up a strength with the other recited the time today, everybody, dan, Marcy and bryan, i'll talk to all again soon. Let's over part and envelops for a look at the biggest named moving into the close security.

I might well, super microsoft s continuing to skyrocket y now more than fifty percent, the last two trading days on optimism that the stock will keep its nasdaq listing. The server maker named video as its new auditor and submitted a plan two nas dec, detAiling how IT plans to regain complaints with the exchange. And that's why I shares are up thirty three percent just today.

Shares of c 3， A I, not too far behind there are up about twenty three percent. The company announcing an expanded partnership with microsoft, they planned to speed up the adoption of c ais enterprise artificial intelligence offerings on microsoft platform. This deal position see three AI as the preferred AI APP on software provider for microsoft ASR azure and establishes microsoft as the preferred cloud provider for c three eyes.

So could. To hear more about this deal, tune into closing, deliver time for an exclusive interview with c 3AS。 CEO. This is coming up at four pm. He turn to and mike.

all right, Christine, thank you. We are just getting started up. Next one top technician tells us why he thinks big coin be building two or two hundred thousand.

He'll join me a post nine and make this case after this break relief in the new york, the exchange you're watch closing. Our goal is to empower you to be a Better, best music teaching. I was able to learn and become financially independent in my join the .

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and supply the S N P N aztec getting a boost today, with tech leading the way, my next gas sees even more upside in the market from here calling for a robust rally into year. And me now I post down with his playbook is john colliver s of macro o risk advisors. John.

good to see you to see my so big picture.

I mean, we've had this little burst higher kind of settled back below those levels of last week. Where do you think we're set up?

Just yeah I think shorter term, robust, like he said, sixty one hundred and sixty two by the end of the year. And then from there i'm thinking next year low and sixty six times hundred hundred and seventy seven hundred and reason being trend wrong, higher highs, higher lows. It's very textbook here. Every time I come on and like the moving averages and in the right direction, I and the sloping positive, no discerning top patterns. So I have to give the trend to benefit out.

Yeah, the market isn't making any obvious missteps in that regard. I guess, now what has been a lot of sort of rotation or maybe some you know leadership shift sadly, suddenly speaking, where does that kind of play out right now in terms of we've trying to decide if semis or broke in and whether, in fact, it's going to be sick?

Kle overtook totally. There's a lot of nuances that was I mean, you got an hour to talk about this part. So I would say first foremost, like why has an hyda a just ripped? Why hasn't low quality just taken off, right? This market doesn't necessarily have to those animal spirits that they did in twenty sixteen.

I think a lot of IT has to do with what the equity markets much more nrt red than IT was. Then the economy is a lot different, and we also have a fiscal issue as right. So how do we position and I think IT, we're gonna a little bit more risk verse on this lag of of the market higher. I don't necessarily think that into next year, it's gonna like the most robust um I say speculative move, but I think we can continue to grind higher. Our leadership should still continue to be within the financial space.

But a good point on the summers.

I think tomorrow, a big day when he comes to be the forms able stock broke out early this month, right? Again, about that one forty level was about a four months consolidation, right? That should project in much higher.

So now you've earnings and technical things happen for a fundamental reason. So we had to have earnings to confirm this break out. Number two is if you take a look at this, the s mate index itself and you look at IT since march, you have a bit of a head and shoulder top.

And I think folks are going to be looking at me like we and video looks one way taiwan and semi looks like in video, but the rest of the semi don't look like them. They actually have been quite weak. So tomorrow will be important. I think you've said this before, the market likes shiny things to play with and IT needs that. And I think to mark, could be a huge catalyst to get us going .

into next and the year. Now to your point that you know the risk appetites maybe have not been fully unleashed and maybe you don't expect IT to be a very speculative market, I mean, maybe crypto s hugging all that energy because, I mean, that's been an undeniable move and it's like standing upon strength than getting strict.

So really see that hit. I love ico in big bow on IT. My longer term is somewhere around the two hundred thousand area may be even two forty or I don't drinks by saying that.

But IT is it's quite remarkable. It's trend in itself. And how I get there is a couple different ways. If this year was just a consolidation of twenty, twenty three massive rally from a measure move perspective, that gets you to about two hundred the last three years and itself was a consolidation and itself.

So it's take a base upon a base and that even get you up to like three hundred years trend. Is deniability strong within the bitcoin? I want to decide on there. And perhaps that will be where we get the speculative access. But it's also which a lot of the software stocks as well, they're actually been quite strong and taking the world of strength, but on from .

semis because of this particularly break out, you think that it's feeding off of the actual crypto move or is to be moving?

I got, I got. Be careful. Yeah, yeah. It's in sympathy.

But also a lot of the software names in their like the demise of the world in art, right? So let's take a step back, right? Think about art. Arts been a big base for the last two and after three years, big basis novation innovation higher into space that goes right. So that kind of that makes me very encouraged about next, when I see those types of bases tie that into the little bit, I think you can continue to see.

I keep going about the four year charts are like crazy on so many of these things, right? This sort of like mountain down to the, it's important .

now it's and it's expected short mind this, right? But if you take a step back and you like way this break up, we having a bitcoin is just a little blip on a four year chart. IT could actually project quite a bit hier.

Do treasury yields the dollar any of that at this point, if they keep moving higher, present a little bit of a channel?

Yeah, I think so we're almost at that uncle point right now when to comes to interest rates. One, the twenty day read to change on yields has gone to a point where equity markets have struggled in the past. So that's number one.

And a number two, the dollar, the dollar is bumping up against a multiyear resistance. It's supposed to fail and roll over if that does not. You know how base is work.

And when you have a long term standing resistance, once that gives, wake up up and goes, it's a coal al spring. That to me is probably a good spot to do your microphones. Just in case IT doesn't roll over, you break out the dollar. You're like going to get yields to rip hire with IT, have a risk off event and why possible see gold rally on the heels of a stronger dollar as a classic risk off?

Yeah um and then I guess just finally, is anything that moved to an lecture? I know you want to stick with the trend. Yeah, but if you look at something, what's gone straight down likes parts of health care. I mean, does he get to a point where it's kind of so bad, it's good or it's so washed out? Yes.

I think a lot about that, mike. right? So on the one hand, you got to say, you know, why are these making new lows but the rest mark is making new high.

So something fundamental has to be wrong with staples and health care. Why are they do in that? But the other hand, yeah, like isn't at a sentiment to dream.

I guy kind of feel like wall. Yeah, we should be long financials. But if things started to roll over, I could totally see the staple le's area. So I think that may be the set up play for the beginning of next year to some sort of mean reversion into safety because I can have the sense that once we get to the sixty one, six, two hundred level, we're going to mobile on the begin the part next year, I can totally see that part of the market yeah kind of stabilize and then grow over.

It's often the characteristic of january anyway is you get .

a little bit of that reverse and you to february too much. So I think that, that could definitely work this way through. I think it's a good point .

like you get that overall. Well, have you back and see the place out way? Thanks very much. Appreciate IT are up next investors anxiously awaiting in video results hitting the tape tomorrow. Intelligent alpha founder dug clinton is standing by with what he will be watching from that and what I could mean for the rest of mega caps. And don't forget, you can catch this on the go by following the closing bell podcast on your favorite project .

will be right that experienced the power of C N B C prose best deal of the year track your prolife friday terms and restrictions apply text talks outperforming today .

as investors prepare for invidious critical earnings report tomorrow a spring in in video a shareholder, the clinton founder and CEO of intelligent alpha here, a post nine dog could see, see, you make. So it's interesting there's always this sort of underlying confidence in the overall story. Within video, we know what supplied, man, as we know, you know, the only game for a certain part of this market. On the other hand, there's all these sort of doubts that filter in, whether it's about the passing of the roll out in the next generation, the overheating stuff, whether in fact, return investment is is happening. How does that all come together into tomorrow?

I think tomorrow is it's almost like day. J. I mean, to your point, right, last quarter, the issue was black. Well, where we we're going to get to delay, we did get a delay was about a quarter.

If you look at what in video stock did after that, I was kind of well rumored, but still the stocks sold off ten plus percent. IT was a pretty decelerate. And so I think going into this quarter, the big topic is going to be this blackwell issue with overheating.

I don't think this issue is nearly as serious. So just to kind of put the two in context, the first issue is really about delaying the entire roll out of this product line. Overheating issue is a little bit more limited.

So this is about a specific product. The gb two hundred is their top of the line super product made a microsoft. These are the customers of that product. Even if they gets to pushed a month a quarter, I don't know that, that's going to be that big of ideal for this particular report. But IT could be something that we hear .

more about the next year. And then you keep hearing that investors really crave some kind of visibility toward after next year. I mean, one of the words how much life is behind these demand trends and into that comes this debate about whether, in fact, things have slow down in terms of improvement of all these AI models and and what does that mean for the investment pace?

I think that's gonna topic b tomorrow. And I expect jenson and we'll get a question about the A I scaling laws, right? And so the scaling laws, just to give the quick one of one, is over the last few years, what we've seen in AI model development is the more data that you put into these models, the more computer you use to train the models, the Better the models get very predictable.

And what we've seen in reports more recently from OpenAI, from google, is that the most recent models that they've trained haven't quite been as good as they expected based on the scaling laws. And it's kind of been a hot topic of debate in silicon valley. Even sam altman tweet about IT just last week, he said there is no wall. So maybe it's not this you will see, but I think jensen really does need to dress that question because that's the eighteen to twenty four my picture. Do we get to a point where these companies need to spend on .

something other than just compute? How is that coLoring your view on just the broader kind of opportunity set within tech for a for companies that I have some leverage to this try me. I mean, you think about my of stock is really have been dead money for a while. We did have such an a deal on earlier saying so pretty optimistic things about uptake of copilot and things like that. But what are the implications, I guess, of this debate about sca?

So in telling how we use A I to make investment decisions, we are obviously fully bought into this A I trend. What I would say is two things made. A microsoft.

I think there are still both stocks that are in a good position to benefit in the near term from eye customers are actually using IT. right? Meet is using IT to drive engagement, beter adds.

Microsoft is selling OpenAI to its cloud customers. But I think if you expand out longer term of you two to four years, we still feel very confident we're going to be in an AI bw market. IT doesn't mean the rupee pullbacks here, there. But I think we've got a long way to go because companies are really just starting to adopt A I, and we will start to see those revenues over the next year and after that.

And then of course, you have the policy regulatory side. You don't really know who exactly all the personnel are going to be, what the what the priorities you're gonna um does IT scramble the picture at all you in terms of whether you know tech is going to have moral less we way a little bit.

And I think any time you have an administration change that does big more questions because we don't really know. But I think the net of IT is this change. You can be much worse in the regime we just had in terms of scrutiny on big tech. And I think if you if you kind of we between the lines of what the current administers, the new administration rather has said about big tech, I think they're baLanced in the reality between making these markets more competitive, but also that we are going to race with other country is to develop I we don't cereal one of weakening our best companies, which are our best chance to win that race.

Yeah I mean, if if most of the priorities about like hey, loosen up the content moderation function and he doesn't seem like that's really existential for anybody, but we do have the alphabet news today about the idea that the government might look to separate out chrome. How does that impact you're thinking about that name of at all?

My guess is if there was a betting market, if we go to calls right or party market, everybody's betting on things. Now I would have to think that the odds are that it's not gonna happen versus IT would happen. So the smart money is still IT probably won't happen even if IT does happen.

And then we've done some math on this in the past. If you look at breaking up some of these components that are stuck in big tech, you might even get a little bit of a value unlock in the near the medium term. And so for alphabet splitting out chrome, I don't know that it's going to be that big in issue, and I wouldn't expect to be something the really way in the stock in the near term.

Yeah um yeah, I guess the other ones in the cross hairs or ones that have been for a while, right? I mean that your basic IT.

I mean, there's nothing new that I think we're going to learn about anti trust, how these companies have acted and .

how the on certain chips that's ready and play. That's right.

I mean, I go back to what was the baseline and are we going to go higher. And in terms of the screaming, I don't think so at best to kind of days where is maybe IT goes little lower.

okay. Good talk you. Thank you. I like up next, we're checking the biggest movers as we head into the close Christinia standing by with them.

Robots are coming. Shares of an AI robotic former up twenty seven percent or tell me why, after this short .

bery sixteen minutes told the closing bell, will get back to Christina for a look, add some kid stocks to watch a Christina from .

watching apple loving because shares are hitting a one year high today after the APP marketing firm said IT plans to restructure its debt by limitation, secured credit or agents as well as establishing a new one billion dollar unsecured revolving credit facility. And in other words, this transition is going to replace the existing secured debt structure with an all unsecured capital approach. And that's why shares are up almost seven percent and shares of symbols are soaring after the AI robotic warehouse company posted a revenue bee in the fourth quarter and offered strong guidance that has analysts .

clamoring to publish a bullish calls.

Key bank needed northland capital, all boosting their Price targets. And that's why shares 不 twenty six.

not too shady.

Yeah quite some some moves and small captain, and I thank you. Your stine is still ahead. Walmart n lows moving in opposite directions after reporting results will break down.

What's behind those moves close to about the right back? Welcome back a quick program note. Don't miss the first on C N B C interview with the C E O of caul com. Its life, the company's investor day coming up on overtime at four P M eastern time today. Up next we'll break down what's behind the big bounce in g vernoff a that are much more when we take you inside the market town. We are now in the closing bell markets home, two big retail names moving in opposite directions coury reagan has the details on the deal, sending g ever noble shares higher and see go back on what's behind intuits swing lower on the day support couple of big ones we got today. Yeah, bigger.

So we're starting get these retailers are always at the tail and right of the others, but right before black friday and the really big holiday season kick off, like you said, walmart lows, they both actually reported Better than expected results, but the shares are going in opposite directions.

Will start with walmart posting stronger earnings, revenue, comparable sales as well as increasing its guidance going into this all important holiday quarter and the retailer even noting positive sales and general merchandise. That's the second straight quarter of gains there, which turns around eleven quarters with that category saw sales fall. But still, chief financial officer joe David rainy told me how much is really changed with consumers.

At least in his view, he thinks americans are still being diverted with purchasing. They are spending, but only really where IT makes sense for them. Now laws also beating across the board, slightly upping its broadcast going into the fourth quarter.

But this is after slashing at an August co. Marvin ellison told me the retail still sing softly and consumers willingness to take on these big projects like we heard from home depot. But Allison believes it's still deferred, not a cancellation of those improvements to come down the line, which is similar to what we heard from home depot. He just sort said, we just don't know when that will come, when that defero will no longer or be a deferral. Waiting for more straight to Normalize whatever that means for him in these customers.

doesn't that? That actually is a huge question to whether there's this sense out there that either consumers can I guess this is the level of rates and I have to yeah do what I can or if everyone believes feds going to be cutting and its worth waiting .

yeah IT seems like at least the executives of these big home prevent reasons seem to think their customers are waiting, coming up and they're waiting. Will they be right? I don't know. How long can you wait right? Sometimes when you need update of after me.

just got ta do IT. The hope for a while is that the time will force these decisions just really quickly too. Though hard to ignore the continued weakness in the dollar stores. And you just sort of wonder if that to read through from walmart .

IT is so interesting. Like I I wanted say, this is back post the great financial crisis where we kind of saw the opposite thing happened with the dollar stores started picking up shares share from walmart when people were using dollar stores more as the filling PS. And walmart since then has really done a lot of strategy overhaul.

So in a way, it's a little hard to tell me. Is that retailer specific or does that have to do with the macro icc environment and then sort of pinching pinny? I mean, I think it's the sales trajectory that walmart stine is very interesting. They also noted that higher income consumers really helped driving in the quarter. I'm not sure that that's the dollar.

That's a fair point. I was looking know I think forty percent of us soles are a hundred thousand or above in householding. So it's it's a huge chunk of the market when they say hundred thousand.

that is a very good point. Yes.

exactly that. That metal.

I know our reference for household income is probably .

changed over the years. So thank thank you.

See g ever nova, what is behind this move company, right? More one hundred fifty percent this year is out with a new acquisition with words heavy duty gas turbine business. It's a deal that is expected to close in twenty twenty five.

IT does provide after market services for natural gas turbines, and that's where G V. Nova makes about forty percent of its revenue a strong growth business while wind continues to play catch up. In fact, last month, CEO got faces act, telling me that he's pRogerin with hyper scales to provide equipment and access to energy sources to fuel their data center ambitions, most recently revealing a new deal with amazon's AWS. One of the reasons the stock has outperformed this year at seen as one of those AI beneficiaries. And we're looking at the stock up another four percent today.

Mike IT is fascinating. Seem a given that the business mix of given over that, of course, harney, this sort of A I driven trend has almost liberated IT from being kind of, I guess, cast as a alternative energy or Green energy type play, which the market at this point is not as .

funded that you're exactly right. Since that spin up from G, E giver, nova has been really smart about positioning itself as one of the players within A, I that can help the hyper scale figure out their energy ambitions and how to actually build out a lot of their energy sources across the country. Because IT has that business already in place. Eighty thousand, eighty thousand employees and a lot of infrastructure there to to back IT up.

yeah. Now this is IT is fascinating. It's also a fun game to add up the market caps of the components of og and see just exactly how vastly that is outstrip what's stood before the spin off. So yeah, it's one of those models that a lot of industrial might be be looking to her. Thank you, sir, and Steve into IT pretty sharp drop on I really some familiar headlines in the sense of something that's been considered a threat for a while.

Yeah that's exactly IT and is not just into IT, by the way, might it's also a block both these names following after the post today, reported president electron's department of government efficiency A K A doge is considering a mobile APP four people to file their taxes. Now, of course, last week, trump appointed italian mask can former republic and presidential candidate the vector M A swami to on dose, which will Operate outside the government, and IT plans to make all those recommendations for cuts by twenty twenty six for the federal government.

Now the IOS is already experimenting, like you hinted that with the free online told to file tax that started this year with a relatively small group into IT, of course, makes the turbo tax software in h and our block has its own software plus a slew of there's human accountants to help people file their taxes. Still unclear how much authority goes is ultimately going to have, and that includes what cuts need congressional approval and what can be done by executive order. We see into IT done about five percent, and agenor block down about eight percent.

My IT is remarkable, Steve, given all that you lay IT out there. First of all, the recommendations not coming for a year and a half plus, right? And then we're not really sure what the actual influence those recommendations might have. And then we've already had this kind of effort to perhaps give people adoption for filing electronically for free. It's just the interesting thing that the market wants to read through a lot of these little developments with regard to doge and say, look out.

yeah, it's it's not just a new idea to and by the way, keep keep in iron this keep in iron, iron must can vivek roes of x feds because they are just kind of out there posting various ideas of what they think those agency can do right now. At the top of eel on musk feed right now is a pink tweet about cutting medicated and medicare. So that's on the line to yeah well .

and we know what's what's happened to some of those health care contract. Is that a lever to that revenue fall will see if if the fears warranted? All right, Steve, thanks very much recipe that forty five seconds or so I told the clothes you have the S M, P.

Five hundred up a bit more than a third of one percent and hit its lower the day around ten thirty this morning. After that initial a brings about geopolitical headlines. And as that opposit up one percent in video, certainly the strongest piece of APP IT has become more inclusive.

Microsoft went from wasted to gains over the course of the day. Market breath has also improved up more stocks. Often dowry.

Now you have, in fact, that a pillow to, we have to want, on the, on the part of a strong day, small cap, a three porters, you want to set in the first microcap. I performe small caps and organize, i'll performe know. So what of the.

that's.

me.

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