Closing Bell - Closing Bell 10/31/25

Episode Date: October 31, 2025

From the open to the close, “Closing Bell” and “Closing Bell: Overtime” have you covered. From what’s driving market moves to how investors are reacting, Scott Wapner, Jon Fortt, Morgan Brennan and Michael Santoli guide listeners through each trading session and bring to you some of the biggest names in business.  Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Brian, thanks so much. Welcome to Closing Bell. Scott Wobner, live from Post 9, here at the New York Stock Exchange. This make-a-breakout begins with two months to go. Whether this rally is ready for yet another burst higher, we'll ask our experts over this final stretch, including Funstratt's Tom Lee. He'll join us in just a little bit. Look forward to that.

In the meantime, let's show you the scorecard here with 60 to go in regulation today, October all but in the book, stocks on their way to a six straight month of gains. Amazon and Apple, both hitting record highs today, following their earnings report, nicely received. Look at Amazon. That's the big winner. Utilities, material, staples are among the weakest areas today. What about FISA? About to close out its worst week ever after cutting guidance. Yes, the stock is in the green today, but it's been a terrible week as a chart. We'll show you. We'll show you that as well. Netflix popping after announcing it's 10 for one stock split. That's a big story. We'll follow that. It takes us to our talk of the tape. The rallies road ahead

as we ready for a new month of trading. Let's bring in now our panel. High Tower, Stephanie Link, a CABC contributor, so is big technologies, Alex Kanchowitz. They're both here at Post 9. It's great to have you both with us. Steph, your biggest takeaway from what you got this week as a shareholder in Amazon, as a shareholder in Meta, and now for the first time ever, a shareholder in Microsoft. Welcome. Thank you. Well, expenses are going up, but we are also seeing substantial growth across every one of these companies and earnings estimates after all these reports are going higher. It's 25% of the S&P 500, these five companies that have reported this week. With numbers going higher, I think that's very positive for the overall index, the S&P 500. I feel really good

about Amazon. I don't feel as good about meta, but I bought some yesterday. Microsoft, as you mentioned, I added, I'm looking for opportunities because I still see the growth and I still think the CAP-X numbers that we're seeing are going to fuel the longevity of AI, right? I mean, you're going to do something like $400 billion from the big five, big six companies in CAP-X this year. You're going to do something like almost $600 billion next year, $700 billion the year thereafter. So you have a tailwind. I know these stocks are up a lot, Scott, but I'm looking for any opportunity to be buying.

Okay. Okay. I mean, it feels to me like the re-acceleration of AWS. the highest growth rate in years is the biggest takeaway of the whole week. Is that right? I would say so. And a couple of things. First of all, don't discount Anthropic in this story. Anthropic has been a big AI partner for Amazon. There are reports that it's going to count for 2% of AWS's growth this year. They're, of course, taking billions in from other companies, from other investors, from sovereign wealth funds, and then plowing that into AWS. So that is part

of the growth story here. And I think more broadly, when you think about the growth in all of cloud, You're seeing that right now, after a long period of maybe these companies will make money by investing in generative AI technology, the end users, or maybe they won't. There was an MIT study recently that said 95% of companies are not getting a return. Now that story is shifting. A Wharton study came out this week that said 74% of enterprises that invest in generative AI are seeing a return. If the end user can start to see a return, then there's doubling of capacity that Andy

Jassy is talking about is really going to pay off and we will see sustained numbers for these data companies. I love what we just showed you on the screen, guys. Put that back up if you wouldn't mind, please. The AWS growth by quarter is a really clear picture of the acceleration, the re-acceleration that you have seen. There it is, right? It was somewhat flat, then declined, and now you have a burst higher. Do we come out of this week feeling as good as we did going in about the whole AI trade? Do we have new questions about dollars being spent versus rewards on the other side? Okay, so dollars being spent is substantial, and that's why META was down so much, but they are seeing an R-O-I, Scott. Everybody's spending, though, right? I mean, why META? Because, look, Amazon is up to

$125 billion for this year. That's the most in the group. Meta 70 to 72, Alphabet 91 to 93. Now, all of those numbers have steadily risen. But why so much? the focus on meta and the questions there are when Amazon's spending a lot more. I don't think that they get the, they're not being appreciated for the ROI that they've already seen from the spend that they've already done. So advertising was up 26%. Impressions were up 14% price per ad was up 10%. Time spent, up 5% at Facebook and threads, and up 30% in video. You want to sell that because they're going to actually increase their spending? Obviously, they're spending to grow. And they're spending for talent.

I was not happy with it. Let me tell you. The first thought out of my mind was they're raising expenses again, but it's working. So that's that's that one. Is it? Are you sure it's working? Oh, yeah. When you grow, revenues 26%, four percentage points better than expected. Operating margins beat as well. And I just mentioned all of the monetization part of the story. So they are monetizing. Give it a rest for a couple of days. Then you add, but I added yesterday on Amazon, AWS at 20 percent, they were capacity constraint. They're going to double their capacity over the next two years. So that means you could probably see mid-20s in AWS for the next several quarters.

That's the nuance to this story and backlog was $200 billion, up 22%. They got more business wins in October than all of the third quarter. And oh, by the way, throw in retail and retail margins, that's also a positive as well. about this meta question? I don't give them a pass. Sorry, Stephanie, but I think, I'm not giving them a pass. Let's debate it. Go ahead. Here's a thing. Well, there's the first the obvious part where Amazon spending, it's going to be correlated into cloud spend. Microsoft spending correlated in cloud spend. Yes, META will get maybe a bump on advertising, but I don't think that's a revolutionary bump. Maybe it's an evolutionary bump. And the key thing with META here is, as this spending increases, it shows that there's actual fear within Menlo Park, that it's not just that this technology will be a new way to search information. It will be a new social interaction on the internet. And I know that sounds weird to. say. But more and more people are forming relationships with these chatbots. They're spent, and not just romantic, but friend relationships. This is what Meta is trying to build as well. Mark Zuckerberg, spending all this money indicates that he thinks that

this is a real threat. And if this is where engagement goes on the internet, that's going to be a problem for Meta. You made it cannibalizes Facebook and the interaction that people have traditionally had on that platform? Yes, I believe so. And look, the The proof is where people are moving. A large part of Open AIs higher ranks are people from META. We want imaginary friends rather than real ones? Yes.

Yeah, I think Open AI really believes this. And they have people from META. They've written memos talking about how they want ChatsyPT to be a toothbrush product, basically meaning that you use it as often as you brush your teeth twice a day for a billion people or more. And so they are playing the same game. It's an engagement game. It's a time spent game. And Mark Zuckerberg is looking at this.

He's seeing his former executives over there. And he's saying, I can't lose that battle. I want them to be doing this on meta products. Maybe it's a friend. Maybe it's an informational buddy. My prediction is it becomes something of both. 60% of the world uses some sort of meta product. That's number one, a huge moat.

Number two, I mean, I mentioned it before, but time spent is a big deal. You just mentioned it. They're getting it. They're seeing an increase. Video is where it's going. And they're seeing a 30% growth because of AI. That is a huge return on their investment, and that is going to lead to continued growth. I mean, family of apps came in at 26 percent, and it beat by 400 basis points where consensus was.

That is a huge, huge number and momentum. I care about the growth. I obviously care about the profitability, too. That's very, very important. You hear me talk about margins all the time, so obviously disappointing. But you're not going to see a massive decline in margins. you're just going to see a level off next year in March. I know, but about it's talking about, like, existential threat to what this company in many respects has always been.

And can I say one more thing about this? The top app on the app store for much of the past two or three weeks has been SORA, an AI-generated video TikTok competitor. Now, is it going to stay there forever? I don't think so. But you have to, there is a new paradigm that's opening up in the world of entertainment and in the world of communication online. And if Mark Zuckerberg didn't think that this was a big threat, he would probably just use some model off the shelf

and build some fun products with the meta, but that's not why he's going all in. And I think it's smart that he's going all in, but that doesn't discount the threat the companies. Let me change it to Microsoft before we move topics altogether because we spent nine minutes. No one even mentioned that name. Well, I mean, I mentioned that you bought it for the first time,

but do we take for granted what they have, the revenues that they're going to get from Open AI, the solidifying of the relationship over this week as Open AI sort of solidifies its own structure moving into the future? Yeah, I mean, I think they're very well positioned, number one. The quarter itself, they beat in all three segments. Commercial bookings were up 111% year over year. RPO's were up 51%.

That's a future indicator of revenues to come. And then you had Azure at 39%. And the stock fell because people thought that they would do 40%. But it's still up from 37% last quarter. So to me, their momentum is still absolutely there. They've got the partnerships. Oh, and by the way, operating margins, they were up 230 basis points year over year, and they beat expectations by 230 basis points.

All of it was really, really good, very hard to find anything that was really bad. All right. Hang with me. We're going to make a pivot, and then we're going to come back. Because Apple's hitting a record high today following its own earnings report. Our next guest also raised his price target on that stock. Morgan Stanley's Eric Woodring. He joins us now at Post 9.

It's good to have you here as well. Thank you for having me, Scott. What's the takeaway from this? The iPhone is back, albeit we still have questions about AI. Well, this was an exciting conversation about spending because actually Apple has been the one left out of this conversation. They just told us that December quarter operating expenses, we're going to go twice as fast as normally. seasonal. I have OPEX growing 18% year over year for Apple and fiscal 26. They're not afraid to spend, but the point is they might not be spending in the same way that the rest of these

mega caps are. Their business model is different, but now they're getting into the AI spending game. That is spending on infrastructure. That's spending on head count. And we know that Apple is usually pretty disciplined about where they put their incremental dollars. It just adds some dynamics to the story because alongside that, iPhone revenue is accelerating, double-digit growth in the December quarter, in the second half of the year iPhone is growing the fastest it has since 2021, so you can at least take some solace in the fact that growth is accelerating while expenses are also accelerating. Okay, these other companies and I read off all those numbers, you know, the CAPEX, because

they're builders. Yes. They are building out whatever their AI systems are going to be for the future. Apple has always thought of itself as a builder too, right? not buyers. Yep. Now, because they're spending now lags because their business model is different than all of these others, do you think they may actually be a big buyer of something and that changes the dynamic? The money is spent. Right. It's a large number. It's just spent on something else. Well, I would call it a hybrid model in that. They're definitely building something internally,

but at the same time, you know, Apple has made a lot of money being the distribution partner for Google search, right? 15% of Apple's operating income comes from just being the platform to distributing search on Safari. That's a pretty lucrative business for them. Getting in the business of distributing large language, others large language models where they invest that CAPEX into it, that's a pretty high ROI business. So my point really is, Apple does believe that they can build some of their own internal technology, but a partnership model and a hybrid model is really where they're going. And if I just get back to that OpX comment, they're talking about infrastructure costs. If you're spending on infrastructure and OPEX, that means you're not

generating revenue from it because otherwise it would be a cost of good salt. So this is training large language models on someone else's cloud. That gets you excited to think about what could come in the future, but the spending is clearly there. It just shows up in a different way than these other megacats. What do you make of the run that the stock has had? Yeah. Is it, is it, is it, is it all based on just such a low bar for where the iPhone was to where this cycle appears to be. You raise your price target to 305. That in and of itself says that you're a believer in the trajectory of this story. Right.

So I think there's two things. One, yes, you know, the bar was frankly low. Apple has not grown at the same pace that it historically has over the course of the last, let's call it six quarters. But at the same time, the iPhone 17 is doing better. People are buying the iPhone. The iPhone is 53% of total revenue. not to mention services is outperforming. I don't want to skirt over that. Services is growing

14% annually. And so, you know, why has Apple gone up? Because estimates have moved higher. And the important thing, at least about where Apple is right now, is there's a lot of ways that you can win next year. In some cases, you have to dream the dream to be totally fair and balance. But at the end of the day, you can look to the iPhone 18 and say they're coming out with their first foldable. It's going to be expensive. But Apple, iPhone owners are usually willing to pay for that. You can amortize it over three years. There'll be carrier discounts and whatnot. But your first real major innovation in a number of years with your core product, and you can say the iPhone 17 is doing better than expected. That just gives you

some confidence to say, well, if I normally price in the next cycle six months in advance, if I can gain comfort with the current cycle, maybe I can own Apple a little bit earlier for that next cycle. I feel like after the last earnings report, we were maybe too quick to say, okay, China looks like it's turning a corner, and now we leave asking similar questions again as to where that part of the business is. You have an idea? Yeah, I wouldn't say that it's turning a quarter yet. China is still a very difficult market. There are subsidies still in place in the Chinese market that help your lower end, that help your lower end phones with demand. Again, not your higher end ones, but China declined in the quarter, right? China declined

four percent year over year in the September quarter. They're telling us it gets back to growth in the December quarter, I would characterize that as a reflection of early demand for the iPhone 17 in China is strong. Let's not go beyond that quite yet. I always like talking to you about this because even though you're positive on the story, you're not blind to the issues or naive to even what you yourself know are issues that exist. Like Stephanie Link, to my left, if I bring them into the conversation, is probably going to say, stock's expensive. right in her mind too much so yeah for a declining growth rate right right she's just not willing to pay up for for that anymore how how would you answer that yeah and so listen it that's very

fair when you're looking at a broad universe of large mega-cap tech stocks right my my universe is tech hardware and apple is is the standout most often but if i'm talking to a global tech p.m what i would say is if we look back to the 2021 cycle apple peaked at 35 times earnings that's when services was 31% of gross profit dollars. Today it's 43% of gross profit dollars. And there's a very clear linear correlation between services mix of gross profit and the multiple. So there is at least valuation to support to say if the iPhone is accelerating, if we can get two years of back-to-back strong growth, then we can make the valuation argument on top of it to say, no, it's not cheap. But if estimates are moving higher, the multiple will move higher. Interesting. That's a really well-put.

Rebuttal to that criticism. It is, and 35 times for a peak. I get it. It's at 33 times, so it's not really compelling in my mind. The historical five-year historical average is 28 times. I know I get the whole cycle thing. I'm not in the camp of iPhone 17 being super cycle. I know it was a very positive point, data point yesterday,

when we got the numbers. So I get that. I just don't think you're going to get an acceleration from like double digits in December quarter. I think you can roll right back down to single digits. And that's what I'm, that's that little cliff is something that worries me. Services, I get it. I mean, I wish it was bigger. I think we all wish it was bigger, right?

Because that's the biggest, that's the most exciting part. It's like, yeah, I think, in and of itself. And they do an amazing job with gross margins. So there was a lot to like. Right. Just there's a right price. And I don't think this is it. No, and I think, Stephanie, your point is correct in that.

The December quarter also reflects the fact that September was capacity constrained. So if you look at the two quarters together, iPhone's growing, call it nine percent. So better than it has been, you still want to see it get better, and ultimately you have to make sure you're tracking the data to ensure that that happens. And so I think your point is very fair. Stephanie, again, the only rebuttal is if we do believe that the iPhone 18 can be the phone with a foldable and higher ASPs that can drive that acceleration, I think in some cases you'd be willing to hold it for that kind of glory period, that kind of cycle when it comes to the iPhone 18. By all means, Apple has to put up the positive estimate revisions to get to multiple expansion. So we can talk in the summer of next year. Last word. I think it's pretty incredible what Apple has done.

There were a couple of years pretty much where the iPhone was either shrinking or growing single digits. Now it grew double digits last quarter. And as Eric said, maybe 9% this quarter, 9% next quarter or even more when you see the numbers. This is a real reversal for Apple. And it's going to ride this strength, especially as it goes into that 18 if it is foldable. I've said it before. I'll say it again. People who hold foldable phones seem to be happy. And I think it's going to be contagious. And people will buy a lot of that model. Smart conversation. Made so by you guys. Thank you very much. It's great to have everybody right here at Post 9.

Let's send to Christina Parts of Nevelos for a look at the biggest names moving into the close. Christina. Thanks, Scott. Well, let's talk about Netflix shares on the rise after the streaming giant announced a 10-for-1 stock split just yesterday afternoon. Reuters also reporting that Netflix has hired bankers to evaluate a bid for Warner Brothers as well. well, Discovery Studio and streaming business. So a lot going on there. CNBC's David Faber reporting earlier today that Netflix's interest is very serious, and that's why shares up 3%. Meantime, Coinbase shares, look at those, up about 6% beating revenue, climbed higher than expected, driven by strong transactional revenue on both the consumer front and the institutional investor front. The crypto exchange also increased its potential share buyback from $1 billion to

$2 billion shares up to $6%. Last but not least, first solar share. are, let's see, higher. They are almost 15% higher, not because of earnings per se, but because of commentary on the earnings call yesterday, while President Donald Trump's tax bill cuts subsidies for solar installations,

Trump's protectionist policies towards Chinese solar panels are really helping for solar. And I say that because the administration's extremely high tariffs on Chinese-owned solar manufacturers is effectively blocking those imports and eliminating First Solar's main competition

in the United States. Shares up 15%. Scott. All right. Christina, thank you. Christina Parts and Avalos. We're just getting started. Coming up next, fun strats, Tom Lee. He is back. As we close out, yet another winning month for this market, we'll find out where he sees stocks heading next. We're live at the New York Stock Exchange. You're watching Closing Bell on CNBC. Welcome back. Stocks on track for their sixth positive month in a row now. And our next guest doesn't see this rally slowing down in November.

Funstratt's Tom Lee. He joins me now. It's good to see you, as always. Welcome back. Great to see you, Scott. I'm going to take issue like I did last time with a comment that you gave to our producers, Tom. You think it's still the, quote, most hated rally.

I just don't know how that still holds water, given where we are. I mean, I interview people all day, every day. I've got no bears around. Well, I mean, maybe some of the bears have gone to hiding, Scott, but because the last time we talked, I wanted to give you some quantitative stats. If you take AIAI, which I think is one of the best surveys of high net worth retail investors, it's averaged minus 11.7 this year, negative 11.7. There have only been three other times in that survey's 35-year history where the year-to-date average has been negative. It was 1990, 2002, and 2022.

So all those times have actually been associated with bear markets. And so sentiment has averaged this year what's consistent with a bear market. So it is the most hated V-shaped rally. Now, there may be some people who say they're no longer bearish, but their P&L doesn't reflect that. No, that may be fair, which leads us to the potential of a change. chase into year end when they realize that what's at stake for them if they're not engaged? That's right. And we know 80% of fund managers are trailing their respective benchmark this year. It's the worst in almost 25 years. And now they're given two things to work with.

One is that seasonally November is a good month. So it should be a positive month. And as far as earnings go, and you guys had a conversation about it earlier today, margins have been improving despite tariffs. And so it's showing you that companies, I think using AI are able to expand profit margins. That's actually a pretty good tailwind because the tariff headwinds are fading, but the benefits from AI margin benefits are still going to grow. Now, I'm a little surprised, maybe not much, but just because you have a history of liking small caps over the last year or so, but particularly coming off the Fed meeting where the Fed chair went out of his way to say that December is not a foregone conclusion and then underscored

that with far from it, which obviously if rates aren't going to go down in the trajectory that you probably thought they would, then small caps are probably not going to perform the way you thought they might. Yeah. One thing to keep in mind is that, you know, Now, if you look at Fed Fund Futures, it's still projecting a cut in December. I think Fed Chair Powell in his statements did give you a window for why it's possible. One is he did acknowledge that inflation's effect from tariffs is less than they expected. And despite a lot of Fed governors talking about inflation widening, that's not the case. When you look at the CPI report in September, it was the highest percentage of components,

54% that were in outright deflation. So it's, in fact, inflation is falling like a rock. And the second was he acknowledged that rates aren't accommodative. They're just less restrictive. And so in a case where there's falling inflation and if jobs market's weakening, I think that that's a good reason for cuts to happen and in a way that's good for equities. Yeah, but I mean, we were talking about December probabilities, Tom, before the meeting at like 100%. now they're down and some like you know geoffrey gunlock who i interviewed the other day post

powell was like could be 50 50 so maybe the that particular trade gets paralyzed if you will between now and the next meeting because we just need to see what the fed's going to do before we become big believers in the small caps yeah well i'm into something that the fed won't will not want to do which is be a little forward looking but we have a government shutdown that's continuing, that is causing even things like air traffic to slow. And inflation isn't going to be gaining strength in a period like that. So if the Fed was acknowledging inflation's weakening now, I think it's even weaker in December at a time when the labor market is suffering. So I think if someone thinks the odds have dropped because of what the Fed said, I just think

the data would support a very opposite picture. And you still like 7,000? at least between now and the end of the year. I mean, we close above $6,900 the other day, so we're well on our way, it would appear. Yeah, that's right. But it probably makes sense for people to be aware that because October was so strong, we have to consolidate some of those gains in the first half of November. And Mark Newton, our technician, does think it's that we're going to be entering a period of chop. So $7,000, yes, makes sense, and it's just going to be bumpy in the next couple weeks.

Hey, Tom, have a good weekend. We'll see you soon. That's Tom Lee. You too, Scott. Fun strat. Thank you. Coming up, the big money fallout following the firing of LSU star football coach Brian Kelly. It is the latest twist in the ongoing debate about the mega money in college sports.

We have the details. We have the debate. We do it next. Welcome back. The recent firings and big money payouts to some college. Football's most high-profile coaches has raised new questions about the economics of one of this country's most popular sports. The issue bubbled over this week with LSU star coach Brian Kelly getting the boot and a $50 million goodbye buyout. That development drew the ire of Louisiana's governor, Jeff Landry.

You are not going down a failed path. And I wanted to tell you something. This is a pattern. The guy that's here now that wrote that contract cost Texas A&M, 70-something million dollars. Right now we got a $53 million liability. We are not doing that again. And you know what? I believe, I believe that we're going to find a great coach.

The Board of Supervis is going to come up with a committee and they're going to go find us a coach. All joining us now is the Wall Street Journal sports columnist Jason Gay. It's great to have you on. You've been writing some thoughtful columns about this topic, which is really captivated people this week. Thank you for having me. It's funny. I see some people suggesting that now that the governor down there has injected himself into this whole process, what coach is going to want to be the head football coach at LSU now? It's a fair question.

And I'm shocked to be saying this, but even by the traditional insane standards of modern college football, we have crossed a new threshold. This is now just the train is fully off the tracks when you have something like that where the governor effectively fired the athletic director of LSU live on camera, unbeknownst to the athletic director. Yeah, it really is incredible because the governor obviously made the comment that he wasn't going to let the athletic director pick the next head football coach. So it's interesting. You really do think that this is an inflection point, that we are going to perhaps reassess how coaches are hired, fired, and how they're paid, especially at public institutions? For sure, and private ones, too. I mean, listen, if you follow the game,

you're aware of what's been happening over the last half dozen years, but you've had a situation now where college sports has stripped away any pretense of not being professional sports, especially in the big revenue sports like football and college basketball. And so now you have a situation where players are able to capitalize on name-image likeness. They have unlimited job mobility with transfer portal. And you're seeing the effect of teams being able to basically change themselves overnight. At the same time, you have this 12-team playoff in college football.

And what it's done, Scott, is this created this like new insanity, this impatience that even again by the traditionally impatient standards of big-time college sports is just wild. Teams, like LSU is a five-and-three team. They had three losses to top ten teams. This was not something, you know, a complete disaster, but they just cannot bear the possibility of not being in the national conversation and they felt they had to act in October. Yeah, it was remarkable. There's no other way to say it, especially on the heels of, you know, Franklin at Penn State getting fired and igniting the whole conversation. One that, you know, Nick Sabin, the great football coach, some would argue maybe the greatest ever, certainly in the last 30. years or so, when he was on game day last weekend, he made the point that given everything

that's happened in college sports, the boosters, the donors, now have way too much influence, and it's out in the open. They had it before, but it was in the shadows. Now it's in the open on how coaches are hired, how they're fired, how they should use their personnel, and they feel much more emboldened because of the checks that they're writing to make those decisions. Well, I think you're absolutely right that this was an economy that lurk below the surface and, you know, making it more public. I don't necessarily believe it's a bad thing. It's just kind of made people more aware of the sort of ridiculousness of how decision-making happens in big-time college sports. And Nick Sabin won seven national championships, but the smartest decision he may have made was to get away from this insane game a couple seasons ago and go play golf and talk on TV because it is a completely different job to be a college football.

college basketball, college coach of any kind in 2025 when you consider all the myriad issues that you have to deal with in terms of player compensation. You now have NCAA sanctioned revenue sharing, $20 million being split among colleges. And then you also have a situation where the players just move along. And again, this impatience. It's this idea that you look at schools like Indiana and Vanderbilt, programs that are traditional dormats have basically overhauled themselves in the space of, you know, 12, 24 months and become national powers, that makes those big heavies crazy. The idea that somebody out there is out-foxing them as much as they are out-spending them. I mean, Sabin obviously saw the writing on the wall to your point. And it's interesting

that you use the word impatience because you could use it on the player side, too. That if a kid goes to a school and it's a great program and they're not playing, they bounce. And they just look for the highest bidder and they go somewhere else and they can't really be faulted for doing that. But because we're having this whole conversation about ostensibly what NIL has done to college athletics. And when people declare it to be the so-called Wild West, when does a solution happen to rein it back in? Well, college sports is desperate for some sort of antitrust protection, which will allow them to basically categorize student athletes, not as employees. They don't want them to be collectively bargaining. They don't want that kind of insanity, free agency and all that kind of stuff. They want to be able to basically, you know,

put their finger on the scale when they need to in order to make sure that you can restrict or just kind of quantify the game in a way that you can't right now. The courts have been resistant to that. And this is bipartisan in the courts. This is not Democrat thing, Republican thing. The courts have been looking at college sports and saying, what's going on? What have you guys been doing around there? You talk about job mobility. Coaches were always abandoning teams. Coaches would leave in the middle of tournament sometimes in order to join their new team. And so athletes have now been given that same kind of mobility, and people are freaking out about that.

I mean, it has changed things, though. In the olden days, you had a team like Alabama. The best team in the country was Alabama. The second best team in the country was probably Alabama's second string. Third best team was their third string. You can't stockpile that way now because a player who is sitting there second or third is going to say, I can go somewhere else. And not only that, I can go somewhere else for a good deal of money.

Yeah, no doubt. It felt like a tremor for certain this week. Jason, thanks for helping us understand it better. Appreciate it. All right, it's Jason Gay, the Wall Street Journal. Up next, we track the biggest movers as we head into the close. Christina Partanavolos is standing by with that. What do you see?

We have one household name, a brand that's crashing to all-time lows, a social media platform that's surging on strong earnings and a crypto company that just can't stop buying Bitcoin just soon. And stay with us. Got less than 15 from the closing bell. Let's get back to Christina now for the stocks as she's watching. Scott, let's talk about Newell brands, the owner of brands like Rubbermaid and Sharpie. Shares are on pace for their worst day ever after it lowered its full year profit and revenue outlook.

On the earnings call, management warned that it's taking, quote, a conservative view of consumer demand for its outlook, and that's why shares are down 27%. Meantime, Reddit shares are in the green, but off their highs of the day after, pressing the street with its quarterly guidance. The social media platform saw advertising revenue grow nearly 75% year-over-year as it continues to see strong user growth. Shares are up 8%. And strategy, formerly known as micro-strategy.

Did you guess before the commercial break? Well, it's on the rise after it beat revenue estimates for the third quarter as the crypto treasury company. Yes, that's what it is now, continue to increase its Bitcoin holdings. But several analysts like TD Cowen lowered their price targets because the company's stock typically trades above the value of Bitcoin. It actually owns. And that premium, according to the analysts, is shrinking, making several sell side guys a little bit worried about how much investors should pay for the stock. But shares are still up almost 6%, Scott.

Christina, thank you. Christina, parts and nebulous. Coming up, stock's heading for yet another winning month. We count you down to the October close, and we do that next. All right, we're now in the closing bell market zone. CNBC, senior markets commentator, Mike Santoli, here to break down these crucial moments of the trading day. Plus, we are joined by Truis, Keith Lerner, and Renaissance Macros, Jeff DeGraff. It is great to have everybody here. Mike, you're with me. You get the first word.

Yeah, obviously, at the end of this week, you had some excuses why you might have backed off. I think the big inference you would make is that the huge AI players do not feel as if they can slow down, and the market's okay with that. So you can sort of check off that box. That explains to me why you have the S&P 500 here again pushing up against its highs. Because NVIDIA is up 10% this week. The rest of the S&P 500 has fought to a draw, basically.

It accounts for almost all the net upside in the S&P. And 10% on top of that market cap tells you that you can kind of ignore a lot of the other soft spots in the market for now, which would include regional banks and some consumer. Keith, your big takeaway from this week was what? I mean, we heard from the most important companies, all but Nvidia, of course, and we have to wait a couple more weeks for that. Yeah, well, great to be with you guys. Listen, I think the key takeaway is still that this bull market deserves the benefit of the doubt. We still think technology is leadership as well. But earlier this week before this kind of Fed pushback, I mean, we had the Russell make a 52-week high.

We had the equal-weight index make a relative high. We have global markets making relative highs as well. And also, earnings are still really strong. We're seeing earnings make 52-week highs as well. I just looked this morning, 90% of technology stocks are beating sales in 80. 37% of beating our earnings estimate. So we have a, we've had a lot of reasons to sell off. And what you're seeing even today, once again, is you're seeing very little selling pressure. And then lastly, I'll say, Scott, we looked at this morning is, you know, what happens when you're up 15%

or more heading into November? And we've seen this 21 times. And 20 out of 21, the market has been higher by the end of the year. So I still think the path of least resistance before year end is still higher. Yeah. I mean, they say the trend is your friend for a reason. And we We seem to be Jeff DeGraff in that kind of market. The charts lining up nicely for you? Yeah, there's a few divergences here and there. I mean, the percentage of issues above their 200-day moving average has been contracting, but not anything near a point where we break the glass and pull the lever.

So I think we're in a pretty good spot. I think the equal weight is actually consolidating and set up, as Keith mentioned, to have a pretty good run into the end of the year. I mean, seasonally, we are standing really at the cusp of the strongest three months that you get traditionally. And, you know, with that, we actually upped our tactical asset allocation to 80% equities, you know, to play that. You know, it's a little, a little tactical.

But certainly there's not enough that's out there that would dissuade us that that shouldn't have a decent tailwind for the remainder of the year. Jeff, is there anything in the so-called extreme bad breath that we've seen at times in the market this week? I think we had like the worst day ever for that. on an up day. Does that matter? It tell you anything? Does it sway you in either direction of something to look out for? No. Look, breath, we wrote about it today. Breath is not a one day or singularity. It's a trend. Keith mentioned it earlier, which is the Russell is in a bullish

trend, the small caps are in a bullish trend. The equal weights are in a bullish trend. If you're going to get the equal weights and the majority of the market in a up trend, you don't have a breath problem. You might have a singular day that's not as strong as you'd like it to be from a breath perspective, but that doesn't have any impact on the future of the returns for the S&P. You know, look at 1999. That was a breadth problem. You had the majority of stocks going down, not relatively underperforming, but actually losing money as tech sucked the oxygen out of the rest of the market. And that's just not what's happening here. Yeah, Mike, you've been thinking about this and talking to us, both at halftime and on this program, about your view on that.

What's your takeaway? Yeah, which is essentially, it just tells you a little something about the character of the market and where the strength is and not necessarily some kind of circuit breaker that says, okay, it's no longer a rally that can be trusted. I do think that it suggests that it's not the most emphatic across-the-board urgency to own equities. It's very much the leaders are the leaders, and they have to be aware of that. And, you know, I do think that it really also, and it's maybe kind of dangerous to say this, but man, does it redeem indexing?

If you are a passive investor, if you were an active investor, would you have held Invidia all the way up to an 8.5% weight? I mean, it's weird, but it's kind of letting your winners ride if you own the index. Now, rebalance out of the equity index allocation. Do what you have to do to stay in line. But it's interesting the way right now the S&P 500 is beaten, again, 72% of other large-cap equity funds this year. Well, that's why, Keith, I guess, something that, you know, there's going to be a performance chase into the end of the year from portfolio managers who were not engaged enough into the biggest stories. Yeah, well, I think kind of going back to that stout that I said before is that when you are up big, there tends to be a chase. And then you go on top of this, the underperformance as well.

And again, a lot of reasons to sell these carousel of concerns keep popping up. But, you know, if you're looking for a pullback, you really haven't gotten more than a 3% pullback since April. So I think that's why that, like, any even small pullback that investors are ready to come in. And I think that will happen, you know, happen again. And, you know, we're still in this earning season. I expect the earning numbers to continue to be strong. And obviously, something can come from a left field. But so far, I think you do have to stick with that underlying trend and give this market the benefit of the doubt.

It's earned it. Most of the banks, which I know you like, the larger ones, Keith, that haven't had a great month. What's that emblematic of, if anything, and do you think it changes? Well, I think even this week, you're seeing a difference, kind of a two-tail market. If you look at some of the regionals, they're pretty weak. But even look at today, the Big Banks, Bank of America, Wells Fargo, near 52-week high. So I just think the markets are sticking with the higher, you know, these bigger names that may be more benefit from deregulation. And there was a little bit of a reset underneath the surface as the Fed pushed back,

where you saw, you know, regionals do a little bit worse. You saw real estate kind of back up. You see small cast back up a little bit. But all in all, I don't see much issues. Just seeing some kind of divergences within the industries. All right, guys, we're going to leave it there as we run down the end of October, the end of a week. Keith, thank you. Jeff, we'll see you soon, as always, to our own Mike Santoli for being here, too, in our market zone.

We're not going to set records today in terms of closes on the S&P 500. nor the Dow Jones Industrial Average. Nonetheless, again, we've got six straight months of gains for stocks. It has been a trend that has been the Bulls friend. We'll see what carries into November on the other side of the weekend. I look forward to being with you then into overtime.