The Rally and the Rate Cut 11/7/24
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R, I call thanks so much to welcome to the half time before i'm Scott water front and center of this out of the rally and stocks on the right cut likely to day the investment committee debating how high this full market might go joining me for the hour today right here, a post nine just Brown, liz Young Thomas, Jenny hering ton and jim laban saw we checked the markets here after that huge day yesterday were a bit mixed. Nazis to stand out as you see there. It's up near one and a half percent, josh ever course says is zubrin lies ahead.

S M, P is going to sixty six hundred by june. Ubs for the tail wins are now possible. Wolf says the trump bump is mostly Priced in, but may still be a bit more to go.

What are your thoughts, tony? You've had a chance to digest from election night when we were together with with our panel. What about now?

One of the things i've noticed about the Price then crowd is they were mostly the people who did not believe in the rally from earlier in the year. So they certainly don't want you to continue IT just looks more and more ridiculous and IT becomes much harder to flip. So you kind of have to double down at this point if you've been barred.

Shed skeptical out of the market underway. However you want to describe IT, I think what's support to point out here is that we were already in an incredible ball market on tuesday afternoon before we had this result. And the surprise that trump one happened in the direction of the trend that was already in force.

Let's look at the S M P five hundred consumer directionally sector as a really great example because it's actually been one of the lords IT made IT high in two thousand twenty one. And I spent the last three years scratching and coin as a sector trying to come back. IT was in a drawed down for four hundred and sixty seven consecutive days.

A mac drawed down of about forty one percent at its low. We got a new high there just now. That typically does not happen at market tops.

The bread fat t. We saw the internals, fifty one percent of the S M P. Five hundred was above the fifty day moving average before the election, seventy one percent about the two hundred day moving I was before her.

The election today, those numbers are higher. But it's just really important to point out, directionally, this was already under way. And of course, is a lot of excitement about the regulation extending the tax cuts honor on on, of course. But it's important to point out this isn't something that's happening like like a lightning strike. This is already been the story of two thousand and twenty four for almost ten on .

interrupted months OK. So the exuberance that ever oversees the tail winds that ubs mentions, what do you see as you take stock of what's happened and what it's going to mean for for this rally going forward?

Now I mean, look, we had the best post election day rally in history. You can ignore that. I would say in one sentence, don't fight IT write IT. I think there's probably still more room for this to go, but not every day is gonna the same. And today .

is a perfect .

example of that. It's and so we've got a lot of trading left to go and the fed meeting, who knows? But what we're looking at today, even just in the sector behavior, you have almost an exact reversal of what happened yesterday.

So that doesn't tell me that I was faker or that we need to give IT all back, but IT does tell me that we're going to have some of these days and shorter term periods where we overshoot, we probably overshoot on the up and the down as usual in the market. But this period now we only have less than two months to go in the year. I think we can continue to see optimism.

We're are going to get what I would call vibe increases. So the vibe is gonna ue to get Better. So survey data, the economic data that we get in form of surveys, whether that's consumer sentiment or surveying companies about what they're doing in hiring and M A activity, that data is likely to continue getting Better through the year, maybe into early twenty twenty five. I think in early twenty twenty five, what we see is as we're trying to figure out what these policies are, what they actually look like and when they're going to be put into place, we get a little bit of a cooling off, we get some pause and maybe a Better entry point in somebody.

I don't know, jim. I mean, what's what to tell when or exuberance to you see? Well.

I heard what was just said, and I disagree. And here's why there's a very so terrible thing that's going to go on in the first quarter of this year, which is the debt ceiling is going to be reached on december thirty first.

Now folks, I know this is as so tired, but it's very important when that happens and the treasury can no longer issue treasuries, IT has to spend down its treasury general account, which is at the federal reserve that puts money into the commercial banking system. It's unquestionable. It's happened every time with the debt ceiling, unless somehow maculate sly, the dead ceiling is negotiated before december thirty first, which I highly doubt.

The commercial banking system will see more deposit inflows. And that means one of two things, either you gonna lend IT out, which is the highly likely thing that will happen, or they will buy treasuries with those extra deposits depressing interest rates. Either way, liquidity increases and that presses stock places higher in general.

So I do think for the next two months because of the factor is that josh listed, you're gonna as market go higher, but then it's going to continue on the back of that treasury general account spend down. And the last thing I want to say on this is for those people are saying, but look, you're setting new highs in the stock market. How much higher can to go? We've been setting new eyes in the stock markets for two hundred thirty two years. That's nothing new and that's not a reason to not be in the stock mark.

And you doubt I mean, the last time you're with this was before election day, you said you you doubted that we could sustain the level of the market where the valuation was. Well, we're pushing on that theory pretty hard and others are suggesting that were we're gonna do that. Um so we have you changed your view as a result of the events of last twenty four? So hours for eight hours not change.

But maybe you find a little bit one thing I think that was interesting that josh said when he said the Price in crowd has been from the beginning not not expecting this rally. And you know, that's exactly i've been I haven't been expected haven't expected to be new highs with the one new and judge being, I don't want IT to end. I am very much and enjoying IT.

So when we talk about how my views are tweet, what I really, really didn't expect was a red sweet. And with that, I think comes the full extension of the tax cuts. And so when I was thinking out to twenty six and beyond, I was thinking, okay, that consumers gonna get pinched after twenty six and the corporations might get penchant a little bit.

And so what we have now is, is not a lift to twenty twenty five earnings because no tax changes will happen next year, but to lift to twenty twenty six earnings. So that's a little bit far dated, but I would say my longer term perspective improves. Um I think with yesterday s enthusiasm IT does make me a little uncomfortable because there was a lot.

But you based on, okay, less regulation, deregulation, that's going to take a while. So you've got tax cuts. Yes.

that's great. But you want to feel that, Sarah, not .

necessarily. It's going to take a while to be dramatically reflected in twenty twenty five earnings. alright. I don't think that such great things are going to happen next year with respected deregulation. That's suddenly if we are expecting fifteen percent earnings in growth year year and twenty five like I don't think that suddenly going to seventeen or eighteen.

you're discounting .

the idea of of renewal and deal making in all sorts of things that we're gonna take till twenty six and twenty seven to get going.

I I think 那 might not take time to get going， but IT might take time to be reflected in the earnings. And so yes, you know, we all now were expected, okay, that m the a cycle will pick up that are we be positive about how quickly does that actually .

hit earnings? I don't know that I will hit in the next six months or and that's where I was going.

So i'm like, okay, tax cut benefits to earnings or i'd say eighteen months out, deregulation, lower .

regulation, tax, I sting.

Less expectations, I think were for those them to refer to twenty six earnings .

were saying hay tax. I mean.

may could come soon.

may get a further. I mean, may I use may okay, caps caps on a further reduction in the corporate rate. Now you may not get that down to fifteen, that's probably unlikely. But any incremental reduction in the corporate, you might not get any, but a pretty good environment as IT is without any further reduction, right? But again, twenty twenty five .

already pricing in the current rates. Now we're saying you're going to have those in twenty six two. So and I just need to adjust .

the effective tax rate for the S M. P. Five hundred this year is nineteen. There are sectors in the market like will estate with the effective tax rate is like sixteen already.

A lot of your type of stocks, the high, high divided payers tend to come from industries where they have a much lower effective tax way already in the overall market. And we're not going to start saying sixteen goes to twelve. okay? That's a really the highest effective tax. I S P. Five hundred consumer directionally, which I talked about at the top of this block, is not a coincidence that those stock just went not to the upside because to your point, that is a thing .

that no one's pricing. Be careful how we look at the direction ary sector OK below tesla are. I mean, the tesla gained over the last couple days has been traditionary.

obviously there.

but big too. But if you want to talk about terrifying and then you want to talk about directionally lives, and then you want to talk about what some suggests, like the national retail federation, if you increase terrorists s, you have the decrease in spending power from the american consumer retail up to the place that you would look first and foremost.

absolutely. And I think that's what happened yesterday. So what we Priced in yesterday was the idea that everything is going to be exactly the same as IT was in the first trump administration.

He's going to put teraphim on, increase them, which is going to increase the cost of consumers. I think there's even this this expectation of increased inflation as a result, but today, we're making up a little bit of that. So I think what we don't know yet is, is the change and growth is the increase in growth that's expected. So GDP growth may be driven by consumer spending enough to offset some of the pain that would be felt in these consumer names because of terrorists probably.

So the thing about high Prices from paris, so demand destructive in the end and you're in bond yells cool down today, the ten years down seventeen points, were back at four spot, three, five. The thirty year obviously came down the most because I do think people got really excited yesterday. And of all the moves, gold dollar, bitcoin, blood of the tesla, russia, two thousand banks.

I think that if you asked me like which is the asset class, that probably was the most outrageous and the need of coming back and they get by yields because these tours will, at some point, if they happen, be somewhat demand destructive and hurt the growth outlook. Maybe not enough to offset the regulation and tax cuts, but enough. Not only that.

but if we want to look out past the next four to five months, I would suggest that under the current proposed Terry regime, the fed is gonna to pivot back to hikes. And I know i'm not just saying that to be provocative IT just seems obvious to me that inflation has to read together head again on the back all the capital expenditures that are going on plus harff. I wouldn't be surprised at six months or now that's .

where the fed pivot will all be fired.

Guys got say, good. I good luck with that.

I said six months. I also said the next four to five months. IT, game on.

make no mistake. So did you say game on? Barbarism is, Stephen says, this is your conductor. Train is approaching crazy town. Is that good? S, N, P five well, I will tell you where if it's both good and bad, he says the S P hundred has upside to the low six thousands and a few months yeah and a thousand plus points of downside to fifty two, fifty a year later that in their view.

you know, when edr danny said, warning the roaring runs right three years ago, everyone marked him when we had A A big correction for girls stocks in twenty twenty one, but he stocked to that call. This looks and feels like we're going into a robber barren age.

I mean, you basically now have in the present IT is your Peter tio elon mosque, people that understand A I, people that understand high tech, people that are personally interested in the outcomes for these massive technological waves. And I think I think you have to say we might go into crazy town, but that might not be all the way Prices into the staff market yet to find crazy town. So crazy town might not necessarily be a negative thing if your a growth stock investor and you have attack bias because these companies are now facing a future less restrictions.

Ma, this year, year to date, one point trillion. Three years ago, IT was three point three trillion. There was a lot of room there haven't had the IPO was yet like crazy town could get become crazy your town. So it's tough to just say like, all right, things are crazy.

That's the end. I mean, if you look at the move yesterday in the financials, for example, obviously, somebody stocks were just up giant normous amount, you know golden, Morgan Stanley, J P M, some of the private equity names, which will get two in a second. But the call of the call, the data day for us is beard saying cell J.

P. Morgan, yes, they know it's best in class. They say, yeah, we know that we agree that has scale and skill and dominant market share and all these other things that make a great include the management team.

Despite that though, we find the risk reward unattractive here and urgent investors to take profits. They understand the optimism, they say about a more benign regulatory environment, more progress th agenda. They just say expectations now are quite high. Josh.

I bought the stock in march of two thousand seventeen and have held that ever since. This is the exact same thing people were saying. Then we were, uh A A year we were a year or so into uh, the first trump term and everyone said it's over.

Loved too much for premium to other banks, too much for premium to the sector. All the good news Price then, and set in the meanwhile, the stacks up two hundred and thirteen percent in in march of twenty seventeen. The X, L, left is up half at once.

Twenty five. The stock has been compounding at sixteen percent of year annualized despite the fact that IT sold that a premium to the group back then. And just for fun, I had my guy chat kid that take a look at the bloomberg, how many times the stock has been downgraded since march of two thousand seventeen fourteen.

Downgrades on wall street since then allow more upgrades and downgrades. But every one of those has been the wrong call. I do not suggest jpm is a cheap stock, really. Two other banks, I suggested IT cells at a premium for a justified reason. And there's no reason to believe that that's gna change you .

want to to yeah .

and I think i've voted for five years and not as long as josh, but long enough to enjoy .

the fruits of cept. okay.

Thank you very much. But here's the just fundamental point. If you're gna sell G P Morgan, you have to be negative on the financial sector.

And I can't do that. I'm very positive on the financial sector. We've talked about deal making, steeper yield curve, credit quality increasing. This is a time to be in financial.

And if you're going to be in financials, and I think many people will, a lot of happening is gonna low to the the unquestionable criminal cram, which were all gone to agree, is J. P. Morgan.

This call to me sounds like the opposite of risk and management. If you're out there selling jp more good, if remember this sort about a year ago, I think IT was ubs actually recommended shorting in video. You remember that, that is just poor risk, man.

And I think that was probably the the CS first boston folks that they brought on board. But like it's just not a good call if you want to be provocative. This is not the way to be provocative. This is a way to get Carried out feet first.

I mean, the stocks up forty percent year to date. I hear what you're .

saying ten times earnings. I mean, here you're saying and i'm i'm not coming back at you, what i'm saying is just this called this is not good risk manager. This this is not the hill you want to go charging up.

What about the private equity firms like black rocket that you've got, Carol for josh. I mean, there obviously is a renewal in the kind of optimism around deal making and the dry powder that sit there waiting to get active, all sorts of stuff that could be stimulative to these businesses.

I ve an incredibly stimulated. And as you're asking the question of thinking about Apollo and how that stock is just rocketed through the roof and maybe somebody would say, well, as time to sell, look, Apollo, the financials in the markets overall, this is a market that is going higher. IT doesn't matter what valuations are right now, okay? IT doesn't matter how many new highs we've set.

This is to what George was saying at the very beginning of the program. This is a period in time in which the economy is doing extremely well. The feds cutting rate, china is trying to stimulate its economy, and Frankly, nobody wants to sell. In the next month.

I have nobody wants to take the taxable game, let tesla earlier. There was a time yesterday where uber was lower and it's down again today. Yes, because of the proxim ity of mosque to power, lets to say the proxim ity that he has to power now the fact he has on tray into the oval office presumedly whatever the hacked he wants IT and he will be in the ear of the incoming president. How are we thinking about what the fall out of that might be for competitors of text like in uber, in autonomists?

I think that's not the reason why anything in particular is happening with uber shares because my evidence is take a look at lift, lifted up twenty five percent today on great learnings s. So I think the main thing that's probably happening here is maybe just some people in left and not in uber as short term trades. Uber is not down very much.

And I think the way the future plays out, uber ends up being the company that connects writers to the the tesla taxi as well as the ways as well as in videos product, which is called wave. I think we're going to see multiple winners and autonomous taxes, and I think over is going to be the hub that connects all those spokes to the end user. Maybe people don't.

That's how things will turn out. I believe the dara is trying to get that done and understanding that he comes from the barrie dealer family tree. I think he understands the urgency to prove to wall street that, that is a viable answer to the AV era, and it's going to be very profitable for the company that has all the riders sitting on the APP waiting .

to be connected. Just let us not forget, we've gone from somebody who couldn't get invited to the White house for an E. V. Summit, to somebody who can pull up a chair to the desk in the oil lots and talk directly to the president about policy. I mean, i'm surprised no one's told me that they're buying tesla up twenty percent on the week in like two days, two, two and a hf days. I'm surprised no one's telling me that they're by in that stock.

You know why? Why not I going to be it's really interesting that this stocks up so much because like, yes, you're exactly right. That's where elon sits and that's a very powerful position that he's in.

But at the same time, there are so much negative regulate an negative subsidy risk for the evs. And by the way, if he does actually get a cabinet position, you know what what happens? He can sell the stock because he gets A A step free, tax free.

So to me, I like you actually have more risk in those shares. Then upside, the upside is just kind of like a story and a party thing. But the reality is, is that and I think this is the cool thing about you on musk too.

He doesn't be so controversial. What I said, he does always do just what's right for him. He does what he thinks is right for the world. And so I think, and yeah, I know people organ go not over that, but whatever.

have a fun day.

actually.

Imagine I A I think.

but I say that because I D I.

D that book.

I read the water eyes exxon book, and I think it's interesting and. A lot of what eat does itself interested about a lot is for the Better of the world. And if we presume bright that he's in the White house because he want to make the world a Better place, not just pump up tesla shares, then he would be on board with removing the subsidies for ez.

which would be determined retail son ax on probably could have pull a chair up to George w. Bush's desk. That wasn't necessarily the smooth this ride for oil companies when we were in the bush era. I think it's like a little bit.

but I mean, no, I expect to mr. Tilson, he a wasn't the richest man in the world at the time there, nor did he run the arguably the most important social media platform right now in the world. Fair point. So I I just think that you know a little bit apples and oranges, but I I get the point you're trying to make.

I do I mean haliburton like we have some examples and they're not quite as exaggerated. This example right is .

our headliner today. He joins us now. He's the managing partner, of course, and head of research, also a contribute. It's good to see again, thank you again for helping us guide are investing viewers through election. I IT was good having you. So what do you make now you've had a chance to digest a little bit of what's happened yesterday was, you know felt ephori that one?

Well yeah first all scot, thank you for having me on election IT was this work and I I really enjoy um the movie yesterday three percent. The best move in the history of any post election rally I think needs to be respected because I really highlights one of two things are both. One is that there was so much d risking into that election actually was unusual.

We actually felt two weeks into election day that that happens like about a third of the time. And the second is that animal spirits could be unleashed because of the interest and belief that there's deregulation emerges and a pro business environment. So I I think it's a very respectable move and I think argues we have five to ten percent upset into your own.

At what point though do you get on board with barbed st's idea that we could be, the train could be leaving the station, heading you full speed to crazy town?

Well, he structure correct that know this market top is not gonna be because of someone's going to a, have a problem with P, E, or because of a recessions gonna a happen. I think it's very likely you know the next six months. The top is because either fie powers exhausted or expectations have become an unhinged on markets.

We can measure either right with a, we can look at margin death that's just in flat for the last four months. So the markets been up and most investors have been risking. That's pretty that's fuel for me outside fuel.

And when you look at sentiment readings, it's it's not extreme. In fact, the fix was elevated and only Normal ize yesterday. So I don't think sentiments extreme.

I was just going to ask you about the vax. It's funny you went there. I'm staring right down thirty percent on the week.

I just a full bone collapse, right? Don't forget we're above twenty big were twenty two at one point last week. We're barely above fifteen.

Yeah IT is actually very interesting to look at the vics futures curve. But on election day, the vics futures curve was over twenty all the way through August next year that IT should be around fifteen, sixteen. The markets were pricing in to mos and uncertainty for like nine months, ten months. So I think there is a huge amount of rerir king taking place. I don't think people got their exposure yesterday and today.

I mean, look, you you I know thought that we wouldn't know the outcome of the election for many weeks. I think that was your base case coming in. So I think there's a lot of surprise rethink as we look at where this market might be able to go.

On that note, you do have a new etf, which I want to talk about. It's called the phone strat grani shot, U, S, large cap, e, tf, granic shots. Being that you think these would be a little bit easier to make, right? Yes.

that's right. How do you build IT there?

We're talking about names. I hope that we show this. I think we have produce this up.

Tesla, goldman, jpm, Johnson controls, caterpillar, emerson, trans, time eaten, oracle, ingersol. That's the top ten. But how do you build that?

Um the granic shots are etf is really a like or built upon the research model we used at function at that was a thematic core stock portfolio that we had been using since twenty nineteen. So for six consecutive years, IT takes seven what we consider relevant market themes and IT finds the most college stock of themes whether it's A I or millennial or fed easing or improving um pms and then the stocks that appeared in in the most frequently a cross themes are our gRandy shots and granny shots is named after all a famer rick way of shooting free throws.

Some of us do remember that we definitely do tests. Let the number one stocked. The waiting is three and a quarter percent. You want to just talk about the moving in that stock this week and and what that means to you in in context of of how you build this and where did you can go?

yes. Tesla has in our research product had been appearing since inception in 20 because that company has a hidden set， which is is its A I and intellectual property and now of course, the intellectually property built around the all this infrastructure they own. So it's a company that to us looks under valued because people look at IT as a car maker or and look at a current margins and earnings. But as we know, there's a lot of new initiative, whether it's robot taxi and you know robots and and now of course, there is a political angle that you guys well discussed. And I I think I can only help tesla well.

will talk to soon. Appreciate you. The commonly fun to chart of the day is next, the best performing stock in the S.

D. P. This year. We talked about that so many times and do IT again next.

Cnbc has quick and easy to understand business news updates at the open midday and close every weekday, markets, money and more from wall street to main street. I C N B C, Jessica adding to follow and listen to C N B C business news updates wherever you get your podcasts.

Walk back to our chart of the day now. Bistro shares a riling after beating revenue, they announced one billion other buy back already was the top performing s in peace stock. Look at IT again.

That's a nice move today. Rob searching, he owns that he joins us now on the phone. So mean, you texted me right when this thing came out with the boom。 So I know you're watching IT tell me more so just incredible .

revenue growth, obviously for utility and the fundamental continue to be strong. Scoped expand a growth margins driven by higher selling Prices in margins. And you know, we just continue to see a compelling combination of secular growth, which is being driven by a strained energy grid demand for reliable energy from these cloud computing giant. This is a company that also generate substantial casual, has a strong baLance sheet and really conservative gf x.

Because does all of the excitement around the build out of avi powering data centers and and the like is that is that powerful enough to offset whatever move you get in, in yields, which you know obviously, yesterday, two sectors were down on A A massive day, OK utilities and staples. Why his yells were surging?

yeah. I mean, I think that obviously that obviously a risk of of this backdrop, right? But I think net, net, the change in administration should be a positive for vista and the other power producers. I think there's a focus on energy production. There's hye odds of a low regulatory burden and red tape around this and increase in investment in showing up.

You know the grid I don't think we're adding at these levels um but we've not trim our position and you know kind of as you get data point like you're talking about, and I think you could see near term consolidation. But ultimately, this remains a really high quality business that's back by a tremendous secular growth opportunity. IT is not that expensive. IT IT trades in a very slight premiums of the sector, has tremendous free casual margins, is debt to event us about half the industry and they're not big spenders. And so if you were to look at, you know this space and kind of pick the best of the best, I don't think this is your grandmother's .

utility space. Yeah, i'm let's leave IT there because I want to I want to want, appreciate, go and yeah, enjoy, enjoy watching that charge all day. Rob seattle en joining a so this is so interesting that you know the best performing sector under president biden energy, the worst performing sector under president trump energy um that's prety new on obviously. But what what about the space? Now another trumpet look.

it's we've heard a lot about this drill, baby drill, right? There's all these things that could have been a tail into energy in five. I still like the sector.

I've liked IT for a while. It's the fourth worst in the index this year. So it's legs some of the others. I think it's time for IT to probably come back, especially if we have increases in m in a activity. I think it's a sector that could see a lot of activity into twenty, twenty five.

And because it's leg investors, first of all, investors are going to start to look for places to generate growth outside of the sectors where they have already generated a ton of growth. And if we don't want to leave the equity market, you start to look at places like energy because it's very cynically. You look at things like health care, you look at things like materials to do a catch up trade in some of this post trump era. And I think that, that's a good opportunity right now.

I about these Jenny stocks today, energy transfer fifty two week high, kinder Morgan, fifty two week high yesterday, one OK fifty two week are record high today. And Williams, fifty two week yesterday, oh.

IT just makes sense, right? Those are the middle am energy plays that all they are banking on is that fossil fuels will continue to flow through them.

Baker hues, this is a name that I put on last week. This is in the space the two week yesterday. So this is more dependent on activity to jane's talking about. This is more dependent on on overall drolling activity and the permissiveness there of and obviously, this thing made a new high of yesterday. You look at a you look at a three year chart, you see a very clear break out back up above the early twenty twenty too high. But then when you pull IT back further, look at a ten year chart, you see what the potential for these types of names that are in the drilling space as services companies.

they're all going to work. They're going to work. But this this is interesting to if we actually go back to your comments, Scott, on what didn't perform well under trump and did perform a loner by and theoretically, right, the regulatory environment should be really favorable for all of these docks.

But IT takes time and it's incredibly nuances and IT doesn't transat immediately. You may remember last week, I I mentioned that I bought devon for the portfolio. And and so devin is a fossil fuel producer, oil and gas.

And and what's interesting is today, they ve got a downgrade by tourist. And when you look at tourist numbers, they're saying like even a light of this, we're adJusting our event. We think you are to make a little bit less than we did before. I'm looking at IT and saying, hey, I bought this a week o regardless of who was gonna in, I bought this not because of the regulatory environment that mayor may not be coming, but because the math work and even with truth downgrade, you've got thirteen percent upside downgrade to the .

Price started sim mode has the headlines for .

a size I should do god president by and just addressing the nation following Donald Victory in the presidential election, promising and order a power and urging americans to accept the choice the country made he told her, a supporters to quote, get back up rudy Juliane appearing in court right now in new york to explain to a federal judge why he has not under his valuables.

There's part of a one hundred and forty eight million dollar defamation judgment. Juliana missed a deadline to turn over his possessions, including his new york apartment, to pay. Two former George election workers were falsely accusing them a ballot fraud in the twenty twenty votes.

Juliana called the whole process equal holidays. Al persecution and former f tix executive and ollie ta research CEO Caroline ellison reported to a minimum security prison and danbury, connecticut to survey two year sentence. He was convicted for her role in a massive raud and conspire cy that doomed the crypto exchange after serving as they start witnessing the trial of F, T, X founder sam bank man freed. That story today, story got back to you.

I see. Thank you. See my body right up. Next we ve got committee movers are, and there are several big names that are on the move today owned by this group on this desk, will trade him next.

Cnbc has quick and easy to understand business news. Up tes at the open midday and close every weekday, markets, money and more from wall street to main street. I C N B C S, Jessica adding, follow and listen to C N B C business news updates wherever you get your podcasts.

Walk back, let's socks and committee names on the move. Let's begin with read IT, which is having a week up sixteen percent this week up eight percent today. It's one your most recent by yeah .

you know how you knew this was going to work because when I came on the show on they said i'm buying a tiny bit. I think i'll be able to add to IT lower. That's like that's my personal case of death that I should have listen to my my recording of me saying that and then added more than I did either way, happy to see this.

I genuinely believe the momentum on the outside for social media is with redit. And I think last time they reported a quarterly profit is just setting the stage for more to come. So prety encouraged by the Price action.

Yeah, a percent move will watch that. We're watching the fx. I to you, obviously, chinese stocks are in focus. Given me talk about increased terrace. You say don't sleep on those stocks just yet lives, right?

yeah. I mean, it's a it's a juicy call. First of all, I understand that there's gonna lot of pressure on china.

They're already husband. But this if I move, we had obviously a big run up after that first round stimulus. And then I give back IT pulled back about eighteen percent.

I started a position. Then I wanted to watch and see what would happen. And i've been adding to IT. It's up five percent today, I added yesterday when I was down in response to trump.

Here's the thing, don't underestimate china's ability and willingness to stimulate, and don't underestimate the fact that they are backed into a corner right now in their economy. And they may have to negotiate, they may have to ease up on some of this. This could just be a very short term trade.

There is an announcement coming likely tomorrow, or at least over the weekend, about more stimulus. And the thing about f xi is the bigger sector and IT is consumer directionally. Second biggest is financials. So this is not .

super waited to tech jme on holdings up today because under armers up a lot on its earnings. Is that why the stock is i've made the direct liner, whether that you think that's right.

I mean, I think it's reasonable. But I also think that there was a pull back in on and you know, people are looking at basically the ebullience in the market and saying where the cheaper names relative where we were two weeks ago or four weeks ago, and on which has been just A A war horse, comes up on a lot of screens. So people are like, if not now, then when, and they get into IT.

We have been talked about disney much lately, but eni was reiterated today at touch as a by Price target one fifteen. What do you think .

is a solid reiteration and nothing too exciting? So this isn't really a big growth story, in fact, earnings for next year, but we have about four after that, twelve percent were off of a huge earnings up increase this year. But here's the thing, start treating at nineteen times and has a five percent free casual yld. So I think it's really more of revaluation story than a big growth story, but I think they're on solid footing here. Finally.

right so early is next with this middy's d we are book right after this quick break.

I were back our singing markets commented to mike and toy joins us with this midday word. I I guess people are going to try to figure out if for on our way to the promise lander is, berry bensa said, crazy town in these markets after what happened yesterday and what might lie ahead.

Now for sure, look at some level, we might be able to be approaching crazy town. I right now it's it's early to talk exactly in those terms. Was interesting to me.

We had to two years a hf percent rally yesterday in the S. M. P. Five hundred.

It's pretty rare to actually have a two plus percent pop that gets you to an all time high that usually the sort of forced really aggressive moment to move that sort of comes in the liftoff face after a pullback or something like that. We did get one in two thousand if you want to talk crazy town. But it's interesting to the europe six percent, the Russell two thousand.

And yesterday, today, it's just fall asleep because IT needs to rest and the good old fashion as that one hundred starts to just grab the baton. So it's rotational still. I'll point out another theme and some of these named you've actually been kicking around, lift dutch brows, read IT under honor, every single one of them ten percent or more short interest and they're just getting smoked the shorts. And that's just not the environment where you necessarily want to push against a voluable name in the tape for people are going to believe .

any feed risk today. Are you thinking about that? We have even talked about IT and we're forty seven minutes in.

I don't know. It's a ton of risk. I think the other factors that are top of mind are probably gonna actually either push against any perceived hawkish rhetoric after this quarter point is or you know it's just gonna a sort of awaiting sea and and we're gonna meeting by meeting or something like that.

And we past the point where we believe the market is upward IT because the fans going to be super aggressive in slashing rates. We talk to million times about how slow rate cutting cycles are generally more olic, we're not even know debating soft landing anymore, right? Yes, of not really landing.

Yeah, that's right. I'll see a bit, mike. Thank you.

That's mike and toli coming up. We get the set up. We had two of josh's food plays. Uh, they report after the bell will take them next.

Let's give me to set up down a couple of josh names that report after the bell sweet Green trading at eighty two week height. What do we think?

Yeah a small position of mine but relatively new name that i'm hoping to learn a lot more about how things are going on the call along with everyone else. But ah the stock has obviously been uh rating furiously all year. And if they have another good quarter, if they have last time, I don't see why .

IT has to stop. Yeah about a five day wind streak, I think. Yeah, toast. Also report you bought IT again last monday around twenty nine box. Where is IT now and at thirty two so it's up a bit ter up. It's up again today. What's interesting is that you have fifty two percent bias, forty five percent holds and three percent cells, but reasonably evenly split between the buys and the halls.

I'm going to tell you what the bear say, because this is the thing that I think they could be wrong and I could be wrong. I don't have tonight, turn will go. The barry say the payment space crowded and everyone's going to be fighting for market chair. Okay, maybe, but the truth is in technology, most of the markets that we have are basically winner takes all.

Toast is the most focused on the restaurant face, talking about one hundred thousand uh users and every time they get their payment process and technology into another restaurant or chain of restaurants, that is the trojan horse by which they sell all of the related services, everything from employee payroll to food ordering systems for the chef at at, at, at saturate. They have fly wheel markets now all over the country where they have huge market chair and they can expand out horizontally ly, which will make this a profitable business going forward. So that's my take wish me look tonight. I have no idea what the number will be, but I think the staff will work of Jimmy, such a gentleman.

why I love you, gentleman. Jimmy, alright, will will come back with finals next.

Well, we have a fed decision today. We have a news conference from the fed chairman. And then right after that, we've got jeffrey gn log joining me on closing. Bell will take you right up to the finish, and I hope you will join me a couple hours for that farmer gym. Final trade.

westing house, westing house area break technology, web tech in a procyclical environment and more cyclical, can you be than railroad equipment?

With this one up a lot yesterday.

I I, yes, he was said a new high.

Okay, wonder why would might be down today? Sometimes it's not that complicated. Jeet hering ton, clearly energy.

here's when they got hammed yesterday in the negev reaction to everything that was cluded energy related, six point two percent yield business should be totally fine.

This Young Thomas .

cyber security, I think, company start to make room to spend on software at a time when maybe it's harder to justify so much A I spend.

And finally, josh Brown .

staying long toast into the earnings. May god have mercy on my soul.

right? One and a half percent. We shall see what happened that does that for us.

Thanks much for joining, as I will see on the closing again with gn lock next changes. Now you've been listening to see nbc halftime report, the podcast. You can always catch us live weekdays at twelve stern only on cnbc.

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