Closing Bell: Playing the Volatility 11/04/24
42:48 Share

What's next for amErica the morning after breaking election results critical insight from campaign insiders how voters are thinking about the economy box wednesday is special time five A R C N B C A life from post night .

here the new ork stock exchange this make a break out begins with three critical days ahead, culminating with thursday's fed decision. What happens with stocks? Many one's guess the backdrop, though still positive.

Most say with the economic trucking along interest rates expected to move lower, alexa experts over this final stretch where this fall market is likely to go in the weeks ahead. In the meantime, there's a scored card with sixty minutes to go in regulation. IT has been a mostly red day for the majors, but we're trying to make a little run a positive territory on both the mazda in the S.

N. P. We will see apple is lower to day. Burch have the way, cutting its stake even further. That's interesting news. And in video, no little tired today is joining the double on friday.

Those two companies, neck and neck today in the market cap, going to track that right up to today's finish as well. Look at that elsewhere. Yields there are touch lower ahead of the fed meeting.

The dollar lower, oil rising will watch all that takes us to our talk to the tape, how to play, what could be a more little couple of weeks ahead to ask and park is the founder and C E O. Try very research to C, N, B, C. Contributor with me, as you can see at post nine woke back .

great to beer.

It's really hard to try and game out the election of what you're supposed to do. So let's try and I guess look beyond um is the backdrop for stocks, no matter what happens on election day, still positive?

I think so. I think so. I mean, the question is to get a growth scare that gets people freed twenty twenty five, twenty twenty six learning repair, probably not um I think the full case is still attack, right?

Gross margins are grown up for a lot of companies. You might get a positive skill out to try to stimulus. You see how on video act, you might get some more case studies that there's productivity from from AI appointment. You we're probably to run a very big deficit next year matter who wins. So that usually finds its way into the biggest twenty or thirty us sixties trickling it's way down. So yeah, I think this set up still skewed to the positive and and the bulk still is still attack unless we get you know a new policy from A A new political regime that that looks like it's going to be more or steer. And then maybe you change .

your mind what happened, jeff, we do run the deficit that your view suggests were shot. Me know obviously we have A A sizable deficit. We have to find IT all that right? What happened if that causes yields to back up further?

Yeah, I mean, the bond vigilante kind of scary thing is always out there. IT hasn't really sustainably happened in the last fifteen years. Even know I hear about IT periodically. It's in the distribution of what people talk about.

You think it's over blow.

over blow, overplayed. Usually when people really get nervous and its risk of trade bones go. I mean, that's kind easier to show that, that is that we're going to have like fear about the health of the U.

S. Financial system and bonuses in backup. So if I look back in time and I look at like all this, a lot of supply coming online, IT will all be bet to demand. I'll make this called the yields are back and up.

Usually IT doesn't happen a way if I go back to like QE one Q E two Q E three twist to rio, like every time the experts would say supplies coming every time yells went the law because when the world was a receiving place, people got a nervous. And about the ten years. So IT could be different this time.

But I know what the institutional investors I talk to, you know all focus on equity. They're not really positioning. I mean, I guess what i'd say is that's been a moving target. I remember years ago, people say off once for three percent on the ten years you as we can handle that. And then I was three and a hand.

and then I was four. Now what does IT five years thirty? If IT does move towards five.

I think if it's because growth is Better than people think, it's okay. I think it's because a good sumer hangs in is okay. I think it's because people word about stack flag and that.

you know nobody know. So laws, we have margins that are good productivity that is rising, the fed cutting and the fed, by the way, cutting not through sort of historical precedent. I guess you could say where is the labor market is deteriorating, where the the fed has to start cutting? great. Maybe this time is different. Those three things, margins, productivity, fed cutting among a few others, if you want to put them on the list that under lays the the bullish backtrack.

I think so. And I think you know if you get some news out of china and always sun, if you're short equity is you're saying I don't care about Martin going up. I don't care about the fed still being in the first half of their path.

I don't care about a massive deficit and I don't care about china stimulating a ton and you're starting to really put together some, you know, you'd Better to be right that people were afraid of a gross scare in the next few months. And then in most years, with the markets up this much in the first ten months, the year IT tends to actually fall through in the year. And also just because people are chasing that performance and you know that fear missing out thing. So even like trading wise, usually when you're this strong, jan, once through october thirty first, you end up put them up november.

december two. Do you think you what do you like the most in the market?

You know so many things really yeah I mean, yeah, I list a few. sure. I I like health care services ah. That can be everything they have pricing power and are going to grow next year sort unless we get a massive recession, things that U N H just tend to earn more money. You know I think the semiconductors I like a lot.

I don't believe that the story about compute growing above GDP remote the over and that's not just in video, it's the whole semicon equipment space lag yeah it's also keen of lot. Yeah S M kind of blue because they're samsung. And but I think ultimate these comes are going to earn a lot more to three years from now.

They are now I think it's a little bit less the diversified companies like enough devices and texas instruments and microchip just because they have you know more broadly, its industrial odd exposure that may be a little longer to burn. Author, the races in meaty, but there's planning things on in semis. I think there's things to own in housing, in building materials.

If we're short structures, whether it's smaller family or single family, I pride on our own building products. It's corning, but Masonite, there's doors and there's installation. You can buy bd, D, R.

You can buy stocks blown up the prior. Better earn is going forward mohock be can rooking flown to go? There's times in the housing exposure sector, public power.

I mean, you look at the stuff with amazon you're talking about in the previous program, but definitely you're gonna need more power, whether it's not gas or we've had choppy stocks today. But I think if you look at year from now, they're going to be up. So power, housing, healthcare services, semis.

what do you hate?

You know the same of the stuff i've been anchored to hate your physical. us. Retailers like the targets and dollar stores, the world that they just structurally chAllenge, that I can get back to the long term average margin that they had an well as a consumer slowing. Now I think the bank thing is interesting.

Um I get the new york reaction that people think what have less regulation and the spector of um you know taxes that these not rising and why regional banks who go up but the banks are up a lot from lows and a lot of the big banks are not really cheap on sensible book. So I think IT probably is more like selling if they go up. And there is like building a position .

for a massive going to if you're talking about some kind of reflation trade, I mean, you never were going to run big deficits. That you know means that the likelihood that rich are going to remain .

elevated .

on the and that banks ot the bank stronger, economy good.

the bank should help. You know they haven't proto to participate that much less fifteen years when we have had some of those conditions. So I think its a question is caused, I guess is more that well, I think there tons of inefficiencies in the banks and in so many ways to improve processes historical, that is compete a lot of businesses on pricing.

And so what happens is that they invest a time for a productivity, but they have to run systems in parallel. And you don't see the benefit of the cost cide till maybe later than you see IT from other businesses that have lots of employees hate small caps yeah I know. I mean my argument is just more um the S P five hundred is sixteen times as big as small cap.

So I had the sapien oni last week I wrote about on the weekend, which is like so somebody want to be over with small caps. great. You own twelve times as much. S, N, P, S. You do small caps instead of the current weight, sixteen times as much.

That's so much less to me than getting like the individual security and sectors right within the sp that i'm almost just like, fine already the the chief the history, I think they're chief for a reason that's mostly, if not all married, which is inferior. A margin profile uh, in further cash was accepted. But if someone who wants to bank on an exhorting economy or the election outcomes, sari, I want a position for small caps to work for two week rally. They could. I mean, if you remember one truck, one in sixteen, I think the roswell s up three percent, like four and old old, right? So you could get a huge short term trade if .

that's what's going to happen.

How you think IT is. But yeah, beyond that, I need to believe .

in earnings and games. I up up she's yeah .

she's she's to put on a tea.

And then .

Christina hoper.

oh my god.

Here's the man to have everybody. I an, I did tina, get the first shot. mr. Parker.

sometimes I need a little help. He's got. So my argument is that we are cutting into growth, that this is an environment in which we are likely to see a very mode slow dm, in the us. And then a reaction elerson that starts next year, markets will discount that in advance. And that means that the smaller and the midcap, which might be the sweet spot that you might even be comfortable with because they do have some of the characteristics of small caps, they're more sensitive to the economic cycle. And I think they could perform very well in now and into twenty twenty.

I've got a lot of love on the the deaths these days for mid caps, especially on policy. Jm sets for twenty pesca golan has called them and me seems to be a good amount of momentum in that. But you have a no. Do you have a bigger .

I think I think map s make a lot more sense, a lot of more high quality businesses that can grow and have good pricing. And you know kid killed when when CPI rises, that's part of the bull case. Look, I think we talked about this really on the year together a month to go, which is if she's right that the economy we accelerate, then yeah, you want to own kind of lower quality stuff that can benefit more.

I think the question or the debate would be like what gives you super confident it's gonna accelerate? Let's say its second half twenty fifteen, I want to be antipatris ye, I buy in february and november a timing age too, right? So I think they could to be debate about IT.

I think when you look historically, small caps royal perform basically, as you can see the recession when blood in the street, that's when you going to gamble that you going to get recovery. And the question is, if now and nobody saying we're going to have a recession, why am I kind of playing for the recovery? On the other side of one, which now seems less like within IT was for at least that I think where .

the debate was Young, you what you're feel here on on these markets ahead of the election, we're got a fed decision coming on. Obviously, it's going to color where we go in the near term to say at least .

I think scots great to be here. Are we think the markets in a comfortable place here. We do think there is still a lot of uncertainty, obviously, and perhaps some disillusion ment with some the A I spending not translating in the profits quickly. But we think the overall back or of the favorable we think the uh case for economic acceleration actually into twenty twenty five on the back of lower interest rates and greater business spending is a pretty sound distance. And we actually think we'll see that growth and we will see that improve productivity going in the twenty twenty five that will allow for a pretty broad basri, including small caps, uh, where we see strong growth, where we see uh, some area the economy that might uh, benefit more from lower rates thicking up a bit.

Let me ask you this is that is that backdrop is is that bigger at this point then whom ever wins the the election? Certain policies are going to be different. Certain sectors are are going to go up and others may go down and stocks may make subsequent moves based on all that. But but the backdrop itself, which the stock markets going to account on more than anything else, is that bigger than whose ever name is occupying sixteen hundred pencil venia avenue. That that being strong economy rate cuts coming end up demand for M A eta.

We do think IT is we think that which sectors might outperform in which individual companies might get a bit extra tail win or perhaps some having a headwind will differ depending on whose in the White house and what some the policies are. But we you think that, that drop is very strong. We think between lower interest rates, productivity and improvements, business spending, uh, coming on strong in twenty twenty five.

We think that's gonna the story of twenty five. And yes, we can get disruptions for things such as terrorists. Uh, yes, we can get uh, tax negotiators that they cause some hiccups along the way. But we do think that backdrop for twenty twenty five is still a favorable one and is going to our way some of the noise that takes its place on a month of month basis.

Cr, you to address that me is kind of the crops of the greet piece the other day in the journal is like growth is is great. Whoever wins is gone to inherit a very strong economy. And the quality of that growth is equally as impressive being the productivity that Young you was just talking about.

absolutely. I think this is quite analogous to the middle nineties, the last time that the fed actually tighten and avoided recession. When we saw those cuts start, we saw very good performance from stocks and other risk assets.

And of course, then we started seeing a lot of investment going in to technology related to the internet. And then, of course, y 2k， which set us up for greater productivity. There was a really nice period in there for the stock market in terms of returns with tech heavy, I think IT could be different this time.

I think we'd see full of participation from cynical, from smaller caps and also from outside the U. S. I think U K.

Equity eupeptic. Q, good em at. So this environment that me is what I think we head four. And IT has very little to do with who was elected tomorrow. IT has so much to do with the fed. So when I hear the trump trade, all I think is or the Harris trade IT is the power trade that we need to be .

focused on that address .

yeah I I think agree with the the panel on um every regime political regime will take credit side blame as IT services them and the reality is really cycles beyond them. I mean, many, many years ago that one of his dog and pony shows, I think he was built back at the book of virtues guy, and he said every day, and I walk my dog in the beach and we watched the sunrise. I just don't give my dog credit for IT.

And I think there's a lot of that. So the element to the economy is good, you say, was because you when you're running the office, no matter what the party is. So I agree with that. IT is more about the industry cycle.

the business cycle in the lake. We we I guess my point would be, are we at an inflection point that's gonna positive no matter what, right? Because the economy is is good, the consumers hanging in and the feds cutting interest rates? Or are we at A A later cycle? My point of view, which matters in the context of this conversion.

if I use january twenty, january first twenty, twenty three, you exposed to cover your in video and meta shorts and get long as possible, right? And IT was because people thought we were close to the end of the hiking cycle and they could anticipate the end of bit, right? So at some point, I think in twenty, twenty five, people say we're kind of more done cutting, then we then not and then they'll sort of discount when when the fed, you know takes foot off the front.

If you look at history, if you look at what's in the Price, I think it's sometime told the end of the first quarter. If we're kind of thing we're used to have being done that you're going to get less excited about the fed still giving the accommodation you you need to start believing and seeing some of the acceleration that people called for IT in the fundamentals. If you get that, then yeah, you'll be fine.

But if you don't, then I think that's the the you know the detention point. But for now, I think it's fine. Yeah yeah.

I think you get that. I think you've got a pretty significant fed easing cycle ahead of us. We also have the potential for very significant real wage growth, and I think we can overlook that as a factor.

I also think in the shorter term, one key catalyst is that the president election will be over what we seen in a lot of the earnings reports and also in the federal reserve. Facebook is that there has been a pause button hit by companies in terms hiring and spending by consumers as well. And so that ends no matter who gets elected, just because we know who's been elected. Think that's a really critical point.

Young, you best part of the market right now for the next I don't know, six months, what do you think that is?

Ah we think it's infrastructure, uh U S. infrastructure. And that does cover some the areas that adam mention does cover housing. Uh, I covers data centers that covers uh, some of the large scale projects are being building, covers enhancement of the electricity grid.

Uh, a lot of money is going to a relatively small statement in the economy, uh, both from spending by making cap tech companies, from fiscal spending a, by ensuring by international companies want to locate the U. S. We think that trend continues and is very strong regardless of those in the White house and still has a lot of legs to IT.

You know what what I find interesting where we have this continued debate on the evaluation of the market. You've been looking a little bit more micro rather than big picture evaluation, looking at stocks which are at fifty times their PS, a sort of a beware or at least trading above their above fifty forward for the first time and at least three years, costco and AMD on that list. Why do you pick those out like what's what's about what this is about that metric that gives you pause?

Well, you know, I think everyone loves costa. Either are going to the store or the stock because they like the high percent, the Operating margin that comes from .

the like I I and maybe they had .

this netflix moments where they're going to get Better at you, not use my card advice first, they are going kind of clamp down on IT. And so the stock kind of went from low thirteen times folders to fifty times.

And what we might all like the stock in the company at some point, you just wonder, is there a barrier? So what we try to do is look for all the companies we could find last twenty five years that sort of kind of reach that fifty times learnings and what the distribution of returns and and multiples work for those security. And the answer is like you don't panic.

So what the friends get there. But six and nine months later, you start seeing pretty dramatic and performance. Multiple attraction, I think twenty four percent the company is two years later could maintain a multiple at high. So the list that we will flag is the stocks.

And when they first get the fifty times, you've got to be a little bit more cautious about and thinking about selling, not that costco and a great business, but just more you're in that thirty percent hit eight thirty five person hit rate land over two years now when you were probably fifty five or sixty prior. So it's is the sort of at some point. Elevated valuations in .

what about AMD? I mean, you said you like chips, you like semi conductors that are .

leverage to A I is amy had pretty move last year in february this year, they got to that fifty times earnings. If the data you know that we looked at right six months later, you start zone that would have been August sort of makes some sense. I do think they'll end if I think most semiconductor experts think that you end up with some sort of eighty, twenty market.

Are that if that panned out through into the market cap, what you show three point three and change trying for in video, then that would be somewhere six hundred and six hundred beer. So frame d, so that be the bull case. Looking out a little bit.

let's just take an informal poll really quickly before we go. Do we get how many cuts do we get between now the end of the year, one or two?

I'll go the expert to my left.

i'm looking at you. What do you want to say? One.

okay. I have no idea what.

We only have two meetings.

Yes, i'll i'll say one, okay, one twenty .

five basis point cut and at least four .

cuts next year OK Young .

you i'm gonna with two twenty five basis point cuts, uh, to the end of this year are a few cuts next year, but probably just three because we think growth is going accelerate in the labor market is going to be strong. The fed will not be aggressive .

because it's interesting.

You guys just think one, I have no idea, have no idea. But I what I do know is people are worth at forecasting that then they are the stock market and they're not good at forecasts.

To start, give you a best thanks.

everybody. Young, you. Thank you resting and thanks. I am. thanks. All right, to seem a mody now for the biggest names moving in to a close.

Hey, god, we've got our eyes on mario delivering a mix third quarter, cutting its early outlook and revealing cost cutting measures. Executives say the U. S.

Election has resulted in notable hesitant in corporate bookings in november, but was also more bullish on international travel picking up specifically in europe, and that government stimulus in china may signal a potential bottoming out. Shares on one point six percent. And then there's bath and body works moving on significant volume, up almost or over eight percent. Unclear on the exact catalyst, but shares are on pace for the largest percentage increase since december of twenty twenty three.

Scott, I see, but thank you. Seem a body. We're just getting started here. Up next, the dean evaluation, ask what the motor is here with this first take on the make a cap earning reports where those stocks might trade from here. That's up the break alive at the new york stocks exchange you watching closing bell on cnbc.

What's next for amErica the morning after breaking election results critical insight from campaign insiders how voters are thinking about the economy walk box wednesday is special time five A M E R C N B C. We are at most .

mega cap names lower following last week earnings reports, with the exception of in video, which is not reported yet. Those shares are rising on news. The company will join the double this week here to share his view on the mac seven.

Is the dinner valuation himself A S the modern and why you turn school the business? Welcome back. nice. See you again.

Thank you.

Good as a shareholder uh, and an observer, uh, and both are valuable to us. You've had a chance now to diggeth these what you take away.

I think that, that these companies will become really good at playing the earnings and scheme. And we look at them, they they can look they look at the expectations. They come in two to three percent above at this point. You're wondering why even bother the expectation they're na beat by two or three percent.

I think the real story that was deeper in the earnings reports, and I think you see IT play out with company inference with microsoft, the recognition that A S products and services, the potential is there, but the promise is not being delivered in terms of unitization. So I I look across the companies now blow out in either direction. But I think in not in many ways, what you need to be looking for is a change narrative.

And it's not coming right now. It's but pretty much the same narrative that's been running them all. You are long .

amazon though. I don't know if I agree necessarily. If you look at amazon, that seems to have been maybe the stand out that the sof figured that out, right, just is figured IT out a way to spend enormously and maintain a high level of profitability after theyve gone through a bit of inefficiency. How how would you assess what they've done?

Now I think in in many ways, I mean, I described amazon as a field of dreams company twenty years ago. What is said, if we if we build that, they will come. And for decades, the market gave them room to build up revenues.

And I think we finally starting to see the profit side deliver. So I think part of the rise and amazon s one of the the other companies, all of sky high margins. Amazon has not. So when you see amazon margins increase, its a delivery on a promise that's been long in the making, but finally are starting to see the numbers being delivered. And I think investors are as part of the reason you think the stock .

Price reflect do you think that the meta and microsoft sell off were justified or or overdone?

I think they were justified because I think when I first heard of the air products and services, I accept that the market can be huge, but every company in this space that's trying to deliver products and services discovering its a lot more difficult to convert that promise into profits. I mean, people might say they want an AI product, but i'm not sure they want to pay for IT as much as these companies expect them to pair.

So I think we will have some back and forth. I mean, if you do get a hit and IT makes money on a subscription basis or and as a transactional basis, I think we'll see the market to what the companies. But for the moment, I think the market is in pause.

More saying show me the money.

You you tell our producers that the max seven or risk of a correction and you think the election is one of the catalyst for that.

I was just listening in on the bull argument for markets. And the more I listening to the bullish argument, less, I think of IT because there is so little behind IT because so much of what's being talked about is already baked in the market, is already baking in an expectation the earnings will be up fifteen percent year for that to happen. All the good stuff you talked about as to happen.

So this is the expectations game for markets have been set up. So i'm not sure even if that good stuff happens after the election, i'm not sure I will you know that you're going to see the market go up as much as you know, the people on your panel thought thought that what to be honest, I to think the fed is going to be the player that drives this game. I mean, it's a follower more than the more than a leader in this process.

I mean, how would you sess the the valuations of this? Stop looking at the forward PS um in not in every case have they have they gone up. In fact in in a few cases, theyve come in microsoft s is come in from the beginning of the year.

Alphabet has done the same. Amazon has done that as well. Apple more less IT is even I mean how I and I understand that these things have stop trading as a monos. So a monoliths hard it's hard for you to address them as a group. But do you look at these and say, well, the valuations in general, pretty reasonable .

mean collectively, if you think the mac seven is over value, also telling me the market is over value, that's why I think if there's a correction that comes, it's going to come from the market correcting, not from these max seven dropping off while the rest of the market goes up. Fact, I find that hard to visualize the scenario where the max seven is down ten percent and the market is up ten or fifteen percent.

Mean, I just can't see that happening. So I think if you own these stocks already to think you're worrying about this, will there be a market correction? And if so, how much will the max seven loose in terms of value at twelve trillion? You have a lot to lose. I mean, you much on the table that you can give up.

Have you sold any of your own positions in these names? I just like to keep our viewers up to dates. Ince, as I suggested, you're an observer, but you are shareholder. Many of these names .

to I saw half of mine video about a year and africa, but since then, I haven't traded down in any of them and haven't increase my position either. I feel pretty good about what I have because I frame in, in terms of what I originally paid for these stocks, not what they traded that they're high three months ago, two months ago. So i'm okay with where I am. And that's the only thing that I have to be as an investors to be OK with my own decisions.

That's why your professor finances to stern school of business because you got into those names early. Let me ask you lastly, before I let you go burker, what do you make of them continuing to sell down their apple position? Do you think do you think they're done?

I think that something they should have been doing the right from the beginning. I never understood charly mongers point that now you have a great company. You shouldn't go down on IT because you can't get over exposed to a single stock no matter how created is.

So I think that some of this is an other pilot is really no reflection on what they think of apple is a company is a desire to have a smaller exposure. apple. And I think that's healthy.

professor, appreciate your time as always and enjoy. We'll see soon as like the modern and like you are right up next top technician Christalan, he's breaking and down how he's navigating the uncertainty surrounding this week election of the decision. He's here a first nine next.

What's next for amErica the morning after breaking election results critical insight from campaign insiders how voters are thinking about the economy SAT box wednesday special time by A M E R C N B C welcome .

back volatility on the rise over the past few weeks. Our next guess so says the S. N, P. Does remain in an up trend.

Joined to me here post nine Chris ferris fatigues recently named one of the top macro analysts on the street. No pressure then for this approach. I have you, right? So we're consolidating a bit, but we're still in an up trend. why?

Yeah I mean, you think about seventy percent of all stocks above the two or day moving average, and we just always to fault to train particularly around an event OK. I think surprises in this business typically breaks in the direction of the trend. So IT would take up a lot for us to want a Better against that here.

And I think what interesting is others are and if you look at the put buying over the last couple days, I mean, put core issues on friday and today are the highest we've seen in years. So there is protection being put on here. We've seen vx already go from called fourteen to twenty four over the last month. There are so and I think that's successive kind of given what the framework is into this.

why so this right now, like twenty two little north to why does that feel excessive?

So I think there's two things here. When val is rising without credit conditions determination, be skeptical of the rise in value. This entire move in vx have been in fourteen to twenty four. Critic conditions have been remarkably and here.

So we're not seeing the type of stress or weakness in double b spreads or tripple b spreads that would suggest hey, wall is telling us something about how IT perceived the economy moving vote. I don't think that's what this is about. I think this is positions getting squared up ahead of an event actually to this .

week election.

And i'd be careful kind of leaning in that direction.

Fifty seven hundred. Yeah a key level you're watching me. We're a little bit above IT here.

Not much. Yeah I don't want to focus too much on precision. Put your thumb fifty, six, fifty. And I think within fifty points on either side, you'll get a good kind of post election below.

The fact is, and as we've shown in our work just time and time again into an election, whatever the prevAiling trend of the market was going in more times than not, IT tends to persist on the other side. I think what's been so key here over the last few weeks in particular is what hasn't changed largely. Financials continue to lead industrials continue to lead directionally and burden stable. So IT doesn't seem like the market that is reevaluating how IT feels about the economy. That's what I want to focus as we kind of look to these last eight, ten years of the year.

Do I remember correctly and that one of your prior parents, as we talked about the the trend of the market and you suggested that as long as the financials remain firm, then it's okay. You don't want the financials to break down. IT would be a bad sign for this leg of the bull market .

if you I always like approaching the market from the perspective, love what has been most system OK financial has have been part of this tape for twelve months. So if our call is gonna change, I think the the tenants of the call that have the most reliable probably have to deteriorate. I don't think you can make the case with financial yet.

I don't think you can make IT with industrial yet. I mean, if anything, over the last four, five weeks direction er is actually gotten Better here as well, certainly at the expensive staple. So what you're not seeing is money move a whole sale into the defensive corners of the market. And I continue to want to say, okay, looks like the market that's Operating .

in the status code. What about semis? We mentioned in video, push an apple right there on the top of the market cap chain.

IT obviously had a incredible run, but not every stock is in the video in this mark. How are you judging the same? This is the one .

place where I really think you've seen and this has really been true all spring into the summer, into the fall where you've seen leadership really fracture or split. We know how good the invidia charges. We know how good broken has been.

Where's a man? Where's that research? Where's a sml? Where samsung IT is of what is perceived as leadership.

I think it's the fault st of that, the weakest under the surface, only twenty five percent of semis are actually above their two day moving average. Here you do get some good seasonally with summer in the next four, six weeks. I think you've got a bounce. I'd be more in client to feed that bound in summer I would be chasing.

I've heard some suggest, uh, health care a good place to be. Uh, you say it's nearing an oversold condition but still in a very pronounced downtrend.

Yeah very that might be generous yeah. When you look at the relative performance of health care, it's been making lower lows in any relative to sense for the Better part of the last two years. I need to see that reflect. There are some short term positives here. You have seen maybe a little bit of life get read to some former and some biotech, but to say that health cares about to make some massive leadership change.

I think that would be premature here if there s up next, we're tracking the biggest movers into this close sima mode is back with that, I sima.

Hey, sky n investors are a loving results from a major fast food Operator abroad will find out the name breed after the short break.

About about fifteen minutes from the closing bell back to see a mody. Now for a look at the key stocks she's watching high. C.

hey, Scott. Stocks tied to the nuclear energy trade are falling today after a federal commission rejected a request to increase the amount of power for a key amazon data center talent energy, which sold the data center to amazon down more than two percent, consolation VISA also tumbling. They were expected to announce similar deals in the future, and then Young china shares rAiling after they posted Better than expected the quarter results.

Revenue grew five percent over year. The company also said it's accelerating new store openings for K, F, C and pizza had in underserved markets across china. Finally got we're watching shares of intel voters reporting just now that silver lake in bank capital are preparing a multi billion dollars stake in in intels all terror unit. Shares of the chip maker were little changed on the news, but download ly three percent following its upcoming exclusion from the dow stock, treating a twenty two dollars and change all right.

see me. Thank you very much. Were also tracking shares today of the new york times. Truly, a bus in here with what's behind that move was seeing down seven percent, Julia.

yeah, down seven percent. And the new york times company of may have reported earnings that beat expectations, but the stock is now down seven and a half percent. As investors question slowing subscriber growth. The company added two hundred and sixty thousand digital subscribers in the quarter. That was twenty thousand less than expected in forty thousand less than in the prior quarter.

Another concern, six hundred of the company's tech workers went on strike today that includes data analysts and designers who support the legs of live blogs and mobile putzel lets these things that are seen as essential to the new ork times election coverage. Now the company did say it's prepared for a range of sign scenarios, but IT acknowledge that the effects on Operations and results will depend on further development. So Scott levy y if they strike a deal before tomorrow.

okay. Julie, thanks so much. It's really boys and still ahead. Watch to watch when hims and hers reports in over time. It's coming up on on the bell.

Walk back, quick programing, note, C, N, B, C, live all night tomorrow. Election night will have the results as they come in. And reaction from the biggest names in business at all starts to seven eleven eastern from the new york stock exchange.

Don't miss that up. Next, we get you set for earnings and O, T, watch to watch for when N, X, P, reports at the top of the hour. That and much more we take inside the market zone. next. We're out the closing bell markets zone C N B C senior mark commentator mix and totally here to break down the pushing moments of the trading day, plus two earning reports we are watching closely and over time brand to go back on him first 新闻 voting on N， X, P, Michael to you first and tells which on your mind we have, I don't know, seventy two hours that be really interest.

say, for sure. And the market is showing that there's not a lot of strong conviction on either side of what happens tomorrow in terms of the election, but also really not a lot of underline panic. You can see some hedging very near term in terms of the book call ratio being high.

You can see a little bit of a cautious wait and sea type action. No big bets. Nobody wants to be leaning too far one direction on a super short term tactical basis.

But I think one of the reasons the market has been able to hang in there, the S A pes, within three percent of its all time high, even as a digest the gains coming into the middle part of this month is the big picture is OK right? The election, no matter what happens, no matter what the implications, is not a maker brake swing factor for an economy that still growing pretty well. The fed is going to likely cut in a couple of days and you have earnings coming through, okay, even if they're not particularly dazzling investors with the beat rate.

I asked you earlier about burker sell in apple. So let me flip IT and ask you about in video now and the inclusion in the doll and and how you're thinking about that based on what you've .

seen through the years. Yeah I mean, obviously on some level, the inclusion of intel previously and not having a play on the video, which is seven percent, the S M P five hundred probably just made the doubt feel a little bit and representative of the economy right now. Now you could definitely make the case that it's just grabbing onto a high moment and play way after the fact after its greatest gains.

I was just looking at the invidia versus apple equation in terms of you know market cat neck and neck right now. Well, in video has about a third of the revenue in the coming year and about half the net income. So you can obviously state a more expensive stock, but it's growing so much more quickly.

So in the short term, at first of all, there's no brand new reason to buy a stock because it's in the dw history says that's not at all a reason to buy. There's not a lot of money index in the doubt is much more about know the way that is validating its current role in the new tech economy, which we sort of new already sell again. I don't think it's to sell the news. Maybe it's a vie because of the capitulation on intel. But at this point, IT seems much more about the dough trying to stay relevant.

I could stop back to in a low bed brand and go back watching him and hers after the bell sky. Earnings in a few shore in at ten, ceding expectations three quarters in a row. Shares, though most recently took a turn after the fda said dosages of novos weight loss drugs were gov and OEM ic were available, and that means hims would have to stop production of its compounded versions.

Remember, the fda made a similar call a few weeks ago with lilly's drugs, but quickly flipped now, allowing the compounded diversions to be sold while IT completes a secondary review. So really, supply remains a big question mark heading into results today. After the bell, investors will be looking at the G P.

One revenues from him this quarter for more clarity. But Candy Scott, a small fraction of revenue growth here at the company, still, those shares live and die on these headlines. Check out some of these recent swings I tracked around G, L, P, one news plus reminds double digits hypo standing there, firm, one firm saying you, it's the warning isn't this is much more there is a much more room for an upside here, here from the company.

CFO a little bit anymore. I could not. Brand, thank you.

Brand, and go as to seem a motian. nx. P, I.

What should we look up for? Unlike some of the other big names, N, X, P, I has under performance on microdot or index by a wide margin this year, up supporting three percent versus the S M H is forty percent run. The big reason is over half of its sales comes from the automotive sector.

That remains a very chAllenge. However, texas instruments and on semi both mentioned strength in china, which analysts say could boat well for and be given its exposure to that market earnings tonight, followed by the company's analyst day on thursday, where Morgan stanly expects growth margins to be revised higher. Will look out for that, Scott.

Yes, we will seem thank much that cinema a and my take take stock of the fix, if if you would, at twenty two. Now you know we talked about with prick o earlier who suggested IT was a little overdone at this level given what the backdrop looks like. Well.

you have to agree with, statistically, IT is definitely overdone. It's duce well above where, for example, the actual realized volatility, the index has been the fact that the S N P e's been making new highs pretty consistently over the last several weeks.

And IT shows you that it's really just the very near term, you know, right after the election, that's all people are basically willing to do, is you will keep their positions, keep exposure to the market. But if you feel like you want to just, uh, hedge against some volatility event, whether it's an indeterminate IT election result, whether it's some other kind of contentious outcome, then you can just buy some index volatility protection that way. So everybody expects, as far as you casually speaking, everybody expects november and december to be this sort of attention release rally in stocks.

Likely volatility gets kind of slashed because there is not a specific thing that we're going to be looking at and fixing on to worry about. We'll see if that does come to pass. That might not be perfectly smooth as all that, but that seems like that's the setup p that we have going into the election in the family.

How do you think yellow factor into that though? I mean, we are kind of fixated on what what they're doing.

IT is true and treasury volatility has really Spiked. So that could be one part of IT as as Chris was saying, the credit spreads have been really team. So it's not really telling you about a macro o event.

It's really just about repricing of the treasury curve and maybe fed expectations. I do think treasury y's rally almost exactly where they needed to, so to speak, before getting out of hands. So therefore yells come in with the help of that kind of noisy soft jobs report on friday.

And then today, a little bit of a bit that just seemed like whatever the big move was over the prior couple of weeks, the markets taking some of that some of that, for example, in bank stocks today is is going on. So I don't think it's decisive if you have shot up from here. Every mark probably really robt really take a well. But right now in this range, IT seems OK given where the economic force number of empty try.

I appreciate you might.

Thank you as my stand. We were ready across the board of the gona be that way with the bell winning here. I'll see tomorrow. We got a busy one on .

election day over next for amErica .

morning after .

breaking election results, critical insight from campaign insights are thinking about the economy money swag box wednesday is special time five A M E R C N B C.