Closing Bell - Closing Bell 5/16/25

Episode Date: May 16, 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.

OK thanks so much. Welcome to Closing Bell. I'm Scott Wabner live from Post 9 here at the New York Stock Exchange. This Friday this make or break out begins with streaking stocks which are about to score another positive week. The

question now how far can they go with questions about trade war and the economy still swirling not to mention the president's tax bill which faced some friendly fire on Capitol Hill today. We'll have the very very latest on where things

stand in just a moment. In the meantime, let's show you the scorecard here with 60 to go in regulation today. As you see, the majors are all higher, not that far from the highs of the day either, with the Dow getting a big bump during halftime today. As filings revealed, several insider purchases at United Health. Hightower Stephanie Link also adding more shares as she told us then. Look at that stock today. It's been a wreck lately but it is up better than six and a half percent. The Russell's up again and now on pace for a six week win streak. We'll follow that also at the

highs of the day. Meta shares are lower today following that report during yesterday's program that the company was delaying its newest AI model. We'll follow that as well. It does take us to our talk of the tape after such a strong rebound. Is there enough left in the tank to take stocks much higher? Let's ask the Wharton School Professor of Finance, Jeremy Siegel. He is also Wisdom Tree's Chief Economist. It's always good to see you on what's become a Friday tradition. Hope you're well. Yes, I'm well, Scott. Thank you. So it's been an incredible comeback. Does it have more steam? Yeah, I think so. Actually, I'm becoming more bullish. I call it the Trump pivot. Remember

six months ago, we were talking about the Powell pivot? I think the Trump pivot, you know, the day that we saw those tariffs go, you know, from 145 to 30, I think right now it's coming into focus. It's going to be a 10 and 30. Ten basically for the rest of the world, 30 for China, and of course aluminum, steel, a couple more on there. But it's coming into focus. It's not a good thing. It isn't positive.

Listen, I think without the tariffs, the stock market would be 10% higher, but it has a lot. The market has a lot of positive things, I think, going for it. I like the low prints I see on inflation. Yes, I do know that the tariffs are going to be coming up, but I think that that is definitely positive. I like what Trump is doing in the Mideast and Saudi and Qatar, and that's a huge area, a positive area there.

And I just like the way that the market is reacting to potentially negative news. I mean, how it brushed off, as you mentioned at the top of the show, you know, the the Budget Committee turning down the tax proposal. But you know, a brief dip, but then a rise. By the way, that's gonna get done. I've seen this many times before. You've seen it many times before. We will get a tax deal coming up so I think this market could surprise everyone by by hitting new highs. Wow an

incredible change of tone and many do believe that the tone and tenor of this market professor has in fact changed since last week. It's evidenced by what you see in the markets here and you mentioned some of the data the real data the debate now is whether the soft data is going to bleed into and become real data consumer confidence Rick Santelli was just talking about it the second worst read ever yeah of all time and at the same time inflation expectations are really ratcheted up. That's not a problem either of those metrics Well, let me talk about that second metric

seven point four percent for one year is You know is No econometric model even the most pessimistic has Anything like that as the inflation rate over the next 12 months. I think, you know, whatever scares being put into people, oh my God, they keep on ramping up and they're hearing 20 percent, 30 percent.

No, I mean, the best estimates I'm getting is that the tariffs will probably bump up the CPI by one and a half percentage points, maybe two over the next 12 to 18 months. It will slow growth. Looks like GDP this year is going to be 1% rather than 2, which we saw on December, but nothing like the data that we're seeing on that University of Michigan sentiment. So I think people might be saying, hey, you know what? This isn't as bad as I had thought. Another positive feature, you know,

the dollar is 10% lower, and there's two positives about that, first of all, that helps the multinationals earnings, certainly translated from euros and other currencies into the dollar, that's a tailwind there. But even though the S&P and AI is maybe 5 to 10% off its highs in the US, it's 15 to 20% off for Europeans

and non-US investors because the dollar has dropped. So they're actually picking up some of the best companies in the world everywhere at a price considerably cheaper than what they saw just six months ago. So whereas some say that the Reeds Today just reek of stagflation, you don't buy that? Again, we're gonna have, we are gonna get a bump in prices,

but stagflation is the sustained increase in prices in the face of rising unemployment. Not a one-bump affair. And when I take a look at, you know, I mean, I actually think, as I've said, the Fed has room to cut rates. We could talk about that, no imminent decision there. Money supply growth, 3-4 percent, that's not inflationary.

There's no pushes there. The dollar, oil, take a look at what's happening there, other energy prices. There's no push there towards the type of inflation that was revealed in University of Michigan surveys. Do you care much when the Fed cuts if in fact they do this year? I mean the markets obviously pushed it out now until September. But what happens if there are still supply chain shocks like the Fed chair himself continues to worry about. He did as much yet again yesterday. And if some of the reads actually become an inflation issue once again, what do they do?

Yeah, well, you know, I'm actually doing some research right now and I'm coming to the conclusion that the Fed has become far too inflexible. And that prevents them from any preemptive move. Listen, you know, people say, well what happens if they lower the rates and the economy keeps on going strong? I say good, then they raise the rates. No harm done. Rates have become almost fixed.

Any movement is seen as a precursor of a huge, you know, move in one direction. Oh, they can't be seen to make a mistake one way or the other. And I think, unfortunately, that breeds acting too late. And we all agree that even, I think, Powell agrees they acted too late in 2020. And they may act too late here. I, you know, a preemptive move, maybe things go great, good, they bring it back up, no harm done.

I think that they have to be thinking in terms of more flexibility given that data and seeing through the tariffs that are certainly coming to the imported goods. It sounds like you've been authoring some of the president's tweets on social media. Well you know I don't agree on everything. There's some things I agree with him on. So I am in his camp that that power could really act at this point. Wow. So 10 percent higher for the S&P let's say with no tariffs you said.

So we have tariffs. We're going to have some tariffs you said. So we have tariffs we're gonna have some tariffs you know barring something we don't know. So what does that mean then for what we can do between now and the end of the year as we become more reliant on things like the tax cuts and the deregulation that we came into the year so hopeful about. I mean how far up could the S&P go? I mean, how far up could the S&P go? I mean, another 10% would bring it into high ground. I think if the Fed is flexible, we might even see higher than that going forward.

If they wait too late, there's going to be some stumbles. And there is a lot of uncertainty there. I mean, you know, with the policy, if the Trump pivot isn't really the pivot that I think it is, that is a negative. But listen, Scott, we all know, you know, the best bull markets climb the wall of worry. You know, I think this is probably one of the most hated bull runs

we've ever seen. Everyone's shaking their head, how can this be? And when everyone does that, I begin to look deeper and say, you know what? I think there are some good reasons why stocks are running and we have to pay attention to those. Bob, do you like a sound bite a minute, Professor? Stay with me. I want to expand the conversation and I do want to get to Washington and get the very latest now

from our Emily Wilkins covering this mega bill battle which the markets, Emma, obviously watching pretty closely. Yeah, Scott, and we do have a bit of an update here. So basically as we recapped earlier, Trump's mega bill hit. What lawmakers are hoping is less of an actual roadblock and more of just a little bit of a speed bump. It wasn't able to clear a committee today, but members are committed to working through the weekend, trying to find a way to yes. And then now the budget committee has announced that they are going to be meeting Sunday at 10 PM. Going to be a long week for these lawmakers. They're going to make it a little bit longer, try to actually get Trump's mega bill through. And of course, some of the issues that have

been coming up have been around the cuts in the bill, Fiscal Hawks wanting them to go deeper. We talked today with Majority Leader Steve Scalise. He was meeting with some of the holdouts and he was actually pretty optimistic that they can come to an agreement this weekend because it's not really about the provisions. It's more about the timelines as to when things go into effect. Listen to what Scalise told us. You know, it's timing implementation. How long, how quickly can we move some of these reforms and get them implemented? So, you know, some of them, we're working on answers. Some of them we need to get answers from the Trump administration, but we've got a pretty clear idea of what the final pieces are. And we're working on answers. Some of them we need to get answers from the Trump administration, but we've got a pretty clear idea

of what the final pieces are and we're working through those right now. At this point, there were four really hard nos in the committee, deficit hawks who were really worried about this budget and who are asking for some of these changes. You see them there. I mean, they have a couple different asks at this point,

but a lot of it does go back to what Scalise was saying with timelines for things. And one of them that they really think the markets need to keep a close eye on here are these clean energy tax credits. They went into effect under the Biden administration. And this isn't just things like wind and solar. This is also hydrogen.

This is also nuclear. These industries are also really watching and benefiting from these tax credits. Now the bill as written would begin to phase them out in a couple of years. These deficit hawks want to see them sooner. Industry wants to see them longer. So a potential point there to be watching

as this bill makes its way through Congress. Scott? All right, that's a great comprehensive look at what's going on. Emily Wilkins, thank you so much. Now let's bring into the conversation New Edge Wealth's Cameron Dawson. Professor Siegel, of course, is still with us.

Thank you for being here. What's your view? The professor obviously has really changed his pace. But we do have this bill issue that we need to keep our eyes on too in DC. Yeah. So from the equity market perspective, I'd add one word to Professor Siegel's assessment, which is positioning. It still remains underweight from an institutional perspective. Institutions have sat on the sidelines as this market has ripped higher. So if you're looking for a reason

why the rally could continue, why we could still have this chase, it's that you still have institutions that need to get fully invested. So we're still watching that very closely as a key upside driver in the very short term. When it comes to the bill, never has a tax reform bill cost so much to the deficit and given so little when it comes to growth stimulus kind of tax cuts, meaning that so much of this bill

is being driven just by the extension of what we existing have. So we do think that it's going to be very difficult to find compromise, that there's likely still a lot of headline back and forth. So we're not necessarily seeing it as a big, huge stimulus in the near term. Best case for stocks is what? That it happens, that it gets passed, but it's just smaller? Probably yes, because if it's smaller, it means the 10-year yield doesn't go up as much.

That's my point. It's exactly right. I mean, therein lies the key to this whole thing is the bond market not starting to throw a bigger tantrum. And as we were seeing some momentum for this bill earlier in the week, we saw the bond yield and the 10-year start to creep higher. We saw the 30-year start to touch 5%.

Those were levels that we got to back in April when equity markets were really freaking out. So we do think that if it is a truly big, beautiful bill, that you could see that upward pressure on bond yields, which would make an equity market trading at 21.6 times forward look rather expensive. That's a perfect, perfect position to send it back to you, Professor. How do you respond to that? Well, remember there's two, several forces on the long bond and certainly I'm always right that one of them is fear of the deficit, but another positive one is stronger economic growth.

And you know, once you abstract from the the tariffs we see the consumer hanging in We see AI going strong. We see the promise of AI going strong we see alliances that You know Trump is trying to establish that will the cement some of the American AI Companies as the premier company staying number one. I think the growth factor is the positive one that's really driving this stock market. Again, I absolutely agree. The deficit long run is unsustainable, but already the dollar has dropped 10%.

There has been that reallocation on an international scale. We're still the best yields in the world. All countries that are developed have long-term deficit positions because they're all aging. And that's where Medicare and Social Security and all that is happening everywhere. All the countries are gonna have to solve that. I certainly think that probably America is the best

of that whole bunch of developed economies. So Cameron, the point being, I suppose, is rates are going up primarily for the right reason. Not if it's just the deficit, right? And so if rates going up for the right reason, that growth outlooks are improving. That's the case that the professor seems to be making. I think that that's something that stocks can tolerate.

However, we don't know how these tariffs are going to weigh on the true growth outlook, just meaning that we have not even started to see the tariffs impact the economy to the consumer side of things. We're starting to see it in PPI where companies are starting to take it on their margins. But hear what Walmart said this week. They said the price increases are coming. You haven't seen it yet, but they're coming. So we think as we get into the summer months, it will be really interesting to see if consumer

spending can hold up and remain as robust as it has been. If you start to see real incomes, that's incomes after inflation start to get pressured. Professor, you cannot have a scenario in which the second worst read ever on consumer confidence on top of terrible reads that we've been getting consistently actually does start to turn up in the real data. You can't have that for your optimistic view, can you? You can have that. I mean, I think there's an over fear by consumers,. As I mentioned to you, those are not realistic inflation expectations

according to any of the models I see. Listen, I granted, listen, you will know, I was on your program aghast at, you know, April 2nd, so-called Liberation Day and what that would do. And I'm no less happy about these tariffs but when I put them into the models and I see others that put them in the models 1 to 1.5 percentage points bump on CPI a one shot a drop of growth of 1.5 to 1% that's what goes from 2 to 1 and then you have what's going to be happening

in 2026, 2027, and all the AI promise and all the other technology factors that are going to make it cheaper for the users of every product to use and productivity. To my mind, this might be a much greater gain than we even saw from the internet at the end of the last century. And many others agree. And that drives, that is much more important long term than these tariffs.

Professor, you and Cameron stay with me too because I want to expand this conversation about positioning. It was a very big week for semiconductors. Christina Parts-Nevelis joins us now with more on those moves, which are a long way from the depths of where many of these stocks had traded. Yes. And I would say that there's two major catalysts for this reversal, this change in sentiment. First you have the major Middle Eastern partnerships,

and then the second is the resilient earnings. So Saudi Arabia and UAE have pledged billions towards tech infrastructure with Qualcomm, AMD, Nvidia, Cisco, Super Micro, all driving sharp gains. And you can see on that graph literally starting from Tuesday when the deal started to be announced and throughout the week. And so although these deals, though,

were very light on details, they did offer access to deep-pocketed buyers that could potentially offset China-related revenue losses from export restrictions. One door closes, I've been saying this, another opens. The second tailwind comes from strong earnings reports. Despite recent tariff tensions, companies including CoreWeave, Texas Instruments, and Taiwan Semiconductor reported no major change in customer behavior. Notably, Cisco CEO Chuck Robbins told CNBC

that he believes 2025 and on the earnings call won't be a peak for AI spending, which is a positive indicator for sustained growth. The outlier in the group applied materials with surprisingly flat revenue guidance compared to the stronger outlooks from competitors like lamb and KLA Which is why you're seeing a mat up only six percent versus the other two over ten percent higher for the week Scott It's all right great Christina. Thank you Christina parts of novelist professor our device

We just used to get us to the fact that the nasdaq is up seven percent this week Tech is back and back in a big way. Is that sustainable? I think the promise of AI is great. We shouldn't, of course, forget about the fact that the only rationale for investment in AI is what it could do to the ordinary individual and firm, all firms, non-tech and tech,

in terms of increasing productivity, increases productivity, increases profits, increases profit, increases stock prices. I think people are looking beyond the tariffs now that the level's in focus. They're going to deal with it. They don't love it. They're going to deal with it and make it from there. And I think that's the explanation that I get from seeing the resilience that we've seen in this stock market.

Cameron, you want to lean in to this trade? So semiconductors are overbought at resistance. And Jeff DeGraff, who's fantastic, did flag earlier today that you could see some weakness brewing in these semiconductors if you don't see them react well to this overbought condition. And so they've rallied 45% off the lows, but they also were down 45% from their July highs from last year. So they led on the way down. They're showing better, higher beta on the way back up. So it's really important to see how we interact with this resistance to see if there's another leg higher. Could we retest prior highs or do we roll

over? All right. We'll see. Thanks for being here. This is Cameron Dawson, professor, we'll see you soon. Absolutely. Professor Jeremy Siegel, down at the Wharton School. Kate Rooney has a news alert for us out in San Francisco. What do we know, Kate? Hi, Scott, so I'm now here and OpenAI

is gonna be helping develop a massive new data center in the UAE, United Arab Emirates. This is according to a source familiar with the matter. No comment from OpenAI, but I am told by this source that OpenAI is going to be part of this 5 gigawatt data center, not the entire thing. So just a portion. Details could change the facility. I'm told it's set to be as large as 10 square miles. Bloomberg did first report some of these details. It speaks to the company's global ambitions for one of the most valuable private companies in the world at this point, worth about $300 billion, and CEO Sam Altman was in Riyadh and Saudi Arabia.

And I'm also told by sources he is in the UAE this week, and the news is consistent with some of the other AI projects and ambitious projects, including Stargate, OpenAI has been a part of and has been doing in the region. Also, we saw a close Altman ally and backer, Masayoshi Son of South Bank there on video with UAE leaders this week and of course President Trump as well. I also just want to mention, I think Christina might be hitting this, but there's news that Nvidia and Cisco are also going to be backing this data center project, which I think is coming from our own K-Parts, but some initial additions there as well as opening up.

Back to you. All right. You're covering everything for us. We appreciate that. Kate Rooney, thank you so much. Cause it's a big day out of the middle. And what was a big week, certainly in the Middle East. A big bounce today as well for shares of United Health. A significant story helping the Dow actually go positive

for the year because of this move that we're witnessing in a stock that's gotten crushed lately. A move that we witnessed during your halftime report. So shares of UnitedHealth Group really bouncing back. It happened just about, you can see on the screen, 12 p.m. Eastern time, when you revealed several UnitedHealth directors purchased more than $1.5 million worth of stock according to today's regulatory filings. That would be Kristin Gill, these are the directors, John Noseworthy,

and Tim Flynn, Fly, I think I have the wrong name there, but bought 5,500 United H shares across three transactions adding to their existing holdings. High tower Stephanie Link also telling you Scott on Halftime Report that she was buying UNH. She said the stock is oversold, has already priced in a lot of the bad news, and so that's why you're seeing the shares up over 6% really really driving the Dow higher midday post 12 p.m. when that filing came out, Scott.

Yeah, no doubt about that. Christina, thanks so much. Christina Partsanevalos. Wow, we're just getting started here on Closing Bell on this Friday. What has star analyst Dan Ives calling this Tim Cook's Hall of Fame moment? He'll tell you from Post 9 coming up. We're live at the New York Stock Exchange. You're watching Closing Bell on CNBC.

Apple's been in the thick of it lately to say the least from dealing with the impact of the trade war to the president's continuing criticism of CEO Tim Cook and his company's manufacturing plans. Dan Ives is the star analyst at Wedbush. He joins us right here at Post Nights. Good to see you. They have been in the thick of it, right? Have you felt that trying to cover this company? Yeah, and then they're in the eye of that storm. I mean, I think no one's impacted more even when you compare to Nvidia. I mean, if you look at Apple, they're in the eye of the storm from a supply perspective, but also a demand perspective.

And that's why, look, we've spent a ton of time the last three, four weeks talking to all of our supplier checks throughout Asia. Basically, again, in comfort, can they get the iPhone 17 in terms of India as well as China just to make sure that this is a head strategy, feel a lot better about today than we did three weeks ago. Give me more on that like the answer that you found if you're asking the questions around that what do the data tell you? So that data tells us that they could scale iPhone 17 production assembly up to basically 60 to 65 percent coming out of India if they need to. Okay so we'll see what happens in terms of the China tariffs

to even deescalate more. But it shows that they now can pivot to a point. Scott, we talked three weeks ago, at the best case, 25%. And even though they talked on the quarter more than 50%, it shows now they're, I think, well ahead of this, putting themselves in a very head strategy, regardless of what happens from the Trump administration, whether it's India as well as China.

Well, I mean, a strategy that's obviously got in the ire of the president. What do you make of that? I mean, look, we continue to view it as a fairy tale, the concept. Making an iPhone. Manufacturing an iPhone in the United States. Now look, if you want a $3,500 iPhone, we should make them New Jersey. The reality is is that it would take four to five years even to get 10% to the U.S. And if you look at the supply chain logistics of it, in my view it's basically, it's impossible. Now look, in terms of AI

investments, everything we've seen, the 500 billion, they probably upped that more. But when it comes to iPhone production, it's India, it's China, maybe some in Vietnam. We just don't see, and we get the pressure, that's, to us, it's not feasible that you could produce iPhones in the US. You see the criticism as just a sideshow. I mean, it also comes in a week, let's not forget that Jensen Wong of NVIDIA is over in the Middle East on this tour tour and the president even called out the fact that he was there and Tim Cook was not.

Is it a sideshow? Does it have the ability to become something more substantive or not? That's a great question. Look, I think the shot across the bow a little at Cook relative to the India move, but also Jensen and Nvidia are in a totally different situation. The reason he's on the Middle East trip relative to the AI revolution now coming to the Middle East, that's basically supplied by NVIDIA and the godfather of AI, Jensen.

When it comes to Apple, they're in a much different supply perspective because to them when it comes to iPhone, the second biggest employer in China at peak iPhone season, so they can't all of a sudden just pivot. They've started to when it comes to India. And look, I think the overall view here is I feel just more and more comfortable going to the next few months that regardless of which way this goes, they're going to be in

a good position not just to produce iPhone 17, but I don't believe as of now you actually get a price increase, which I know that's been some of the talk out there. Less than a month, you and me literally sitting next to each other at WWDC out Cupertino, right? We'll be there. What kind of pressure now is on Apple to deliver something really substantive out of that event? I mean look, it's obviously a huge mea culpa if you go back a year ago. I mean you don't get a second chance at the app.

I think this is one where they need to lay out for the developers what the AI ecosystem is and you can contrast that with Meta and obviously what they're doing with their model and obviously pushing that out. There's a window of opportunity here for Apple. I also believe we'll get that Alibaba partnership in China which I think is key, that AI partnership. The developers, I mean you've talked about the hearts and lungs of the Apple and the Cupertino network. Yeah, stakes are gonna definitely be high as we sit together out there and I look forward to that. Dan, thanks. Thank you. Dan Ives, Wedbush. When we come back, Bunstrat's Tom Lee.

He is standing by as we wrap up this week's Big Gains in the Market. We'll get his take on where we're going from here next. We are back stocks on track for their third winning week in the past four. The Dow positive now for the year along with the S&P and our next guest argues the risk reward is much better now Than even before the trade war started fun strats Tom Lee is a CNBC contributor and joins us now from Miami It's good to see as always. How's that possible? How's the risk reward better now than then? Scott I think when we go back to February when the market was at all-time highs We have to keep in mind we had a lot of uncertainties ahead of us and we weren't necessarily looking at 2026.

You know, the tariff visibility is much better today than it was three months ago. And when we look at 2026, I think that there are things to look forward to, such as deregulation, tax cuts, and actually a Fed that's on hold now, but probably doing more cuts now in 2026. And then from a company perspective, companies survived, I think, a black swan event. That waterfall decline in equities and the sort of the near heart attack of the economy

still allowed, was an environment where companies produced earnings that beat expectations. I mean, so this is the fifth stress test for businesses. I mean, when I put all that together, I think P.E.'s probably going to be higher in six months than lower. And when you think about 2026 earnings having upside, I think they're still upside for stocks. So, I mean, because you keep talking about 2026, you're not writing off the rest of this

year. We still have seven months to go. Yeah. We have a lot of history to make between now and year end. But keep in mind that that waterfall decline in stocks also was almost a complete reset in positioning and sentiment. Investors were forced to liquidate when the VIX hit 60.

We know a lot of institutions didn't re-add risk back as the market rallied. So I think the pullbacks are gonna be pretty shallow because investors just are under-invested at the moment. And then when you look at sentiment, it's barely turning neutral now. So if investors have been fighting this rally as they become more neutral or more optimistic,

that's upside for stocks. I mean, Professor Jeremy Siegel, like you, has grown more bullish, pointing out, in his words, the Trump pivot on the tariffs, but he still acknowledges the fact that the tariffs are likely to remain in place, whether it's 30 on China and 10 on everybody else. That's still somewhat regressive, is it not? Yeah. Well, I mean, you know, we are now in a new world of tariffs, and businesses are adjusting.

I think one of the things that we're seeing is that the market is now in a position where they can start to look through some of the messy adjustments. We know there's been a disruption to the supply chain. I think stocks can look through that. But you're right, Scott. There is now this world where there's essentially a consumption tax in place on things that we're importing. But that doesn't mean we have to actually have the PE decline or the markets to fall.

It's now just something we have to kind of manage through. What about yields rising? How much of an issue potentially is that? Well, I think Fed SharePAL made a good point that long-term yields could be rising because of inflation volatility rather than inflation expectations going up. That's actually an opportunity for markets because if inflation volatility delivered is less than expected then we could expect

yields to come down in the future. Yeah but what about I feel like the bulls are finding convenient excuses for why the rates on the longer end are going up. What if it's simply Tom is the fact and I don't mean to single you out I mean the professor in his answer to the question to put more credence in the fact that well maybe it's because growth is going to be better not so much the deficit. However what if finally the bond market is saying enough is enough and it's time to get real? And if you all don't, we will. Yes, Scott, we had, there was a moment like that a few years ago when, you know, when an auction went badly

and many people declared this was sort of the end of the ability for the U.S. government to finance and people panicked and the VIX surged but even in that moment it proved to be a buying opportunity for equity so I think if there is a moment where maybe the bond market sort of has a tantrum about that and I'm not saying it's going to happen but if it does I think we have to remember the US is a huge economy there is still a lot of trust in the US and I think those who've called for the end of US exceptionalism I mean I think we have to remember the US is a huge economy. There is still a lot of trust in the US. And I think those who've called for the end of US exceptionalism, I mean, I think that's been the premature call.

And if none of those is true, the bond market and investors can handle even a 4.5%, 4.7% tenure. What would you lean into in the stock market right now? What do you like the best? Well, I think the things that we're working January to February and the things that have led from April to now are the ones that we want to stick with which is like the Mag-7, Bitcoin, I mean these are washed out groups because they were the first to fall and then we like the cyclicals like small caps, financials

and industrials including the regional banks. Wow so they'll withstand any movement in rates, they'll withstand continued questions about the durability of the economy. Again, I know there's a huge difference between soft data and real, but that sentiment and a confidence number today was was horrific. Yeah, I mean we're in some really bizarre territory when it comes to the U-Mish inflation expectations, right? Nearly 10% inflation expectations when the delivered number is so low.

Scott, I mean, these are divergences, but from an investor perspective, I would say that the hard data tells us expectations are too dire relative to delivered results. That's been the case since 2022. As you know, like the ISM has been below 50, yet companies were growing earnings. And I think if someone thinks it's cheaper to play this through Europe, just keep in mind, German tech stocks trade at 33 times earnings.

When you look at US tech trading at 22, 23 times, you're getting a 10 PE discount buying US tech. And again, I think that means we're probably stretched on this non-US exceptionalism trade. And you don't care about delays in AI models like we got from Meta and those types of questions in the face of huge continued spending? Well, there's always going to be speed bumps, Scott, but I think when we think about this structurally, the visibility for AI spend is far better than a lot of other things that we can call secular themes.

So, whether it's cyber security or AI and automation, first of all, the US companies are really the leaders here. I think as tariff tensions de-escalate, it's allowing investors to actually go back to looking at these stocks. I mean, in a strange way, I think this is the first week that feels normal since February. Yeah, we really haven't gotten any tariff headlines, but that's probably why.

Enjoy Miami, we'll see you soon. That's Tom Lee. Thanks, Scott. All right, up next, we track the biggest movers. As we head into this close, Christina Parts-Nevoulis is standing by once again with that For us, what do you say Scott? Well, we have a crypto exchange shares that are bouncing back after analysts say the sell-off was overblown

Meanwhile telehealth platform tumbles on cautious guidance despite no signs of a slowdown. I'll explain next Lesson 15 from the bell. Back to Christina now for the stocks that she is watching. Tell us. Coinbase. I hope people guessed that. Coinbase shows rebounding from a slide yesterday after the crypto exchange confirmed. The SEC was investigating whether it misstated its number of users. There's been a flurry of analysts on the street who said that the reaction was likely overblown

as Coinbase hasn't reported the metric in more than two years and that's why you're seeing shares up 8%. Meantime, weak guidance sending shares of Telehealth platform Doximity lower. The company said it has not yet seen any signs of a market slowdown but expects there will be. Why? Due to policy uncertainty. The key word there.

Shares down about 10% right now but still up about 120% just over the last year. Context, right Scott? Appreciate all of it today, Christina. Thanks for everything. Thank you. Covered it all, the important stories for us. Thanks so much, Christina Portes-Neviles. Coming up, Ozempic maker Novo Nordisk ousting its CEO.

Take a look at the stock, it is down more than 50 percent from its high. We dig into that move where the stock could be heading from here, coming up. We're now in the closing bell market zone. CNBC senior markets commentator Mike Santoli is here to break down these crucial moments of the trading day. Plus, Angelica Peebles on Novo Nordis surprise leadership change.

Julia Borsten taking a look at the record run for Netflix. We begin with Mike. Nice move on this Friday and what the professor at the Wharton School, Jeremy Siegel, told me just a short time ago. Let's listen to what he said about his view on this market and I'll get yours next. Listen. I'm becoming more bullish. I call it the Trump pivot. Remember six months ago, we were talking about the Powell pivot. I think the Trump pivot, you know, the day that we saw those tariffs go, you know, from 145 to 30, I think right now it's coming into focus. Yeah.

I mean, look, it captures what the market has gone through, which is up 5% this week, up almost 25% from the lows six weeks ago. VIX goes from 50 to 17, the fastest ever. And it's because it was that easy, right? So this optional and kind of war of choice on tariffs, if it gets dialed back. So I think that's where the contingency comes in, right? It's a pivot if it remains a pivot in policy. And it's also what makes this episode look a lot like those others that I've constantly

talked about in 98, no recession but a 20% drop. In 2011, no recession but an almost 20% drop. It required a policy circuit breaker to get us past it. If the sticks, then we've got that. All right, Angelica Peebles, tell us more about Novo. Yeah Scott, Novo CEO Lars Fjordgaard Jorgensen is out as CEO after eight years in the job and he's only the fifth CEO in Novo's

roughly 100 year history. So this sudden removal coming is somewhat as a surprise for a company that's known for being patient. But Novo's stocked down more than 50% from the record high that it reached last June Coming is somewhat as a surprise for a company that's known for being patient. But Novo stocked down more than 50% from the record high that it reached last June. And Novo's majority shareholder, the Novo Nordis Foundation, pushing for a change in leadership. The foundation's chair, who was also once Novo's CEO, will join the Drugmakers Board so that it can increase its representation. And it's really quite a dramatic turn for Novo.

Of course, they created the GLP one boom, but now they're losing ground to rival Lily, whose obesity drugs upbound has about 62% of market share, despite being two years behind Novo's Bogovi. And the bigger concern for Novo is what's next. They've had several disappointments in their pipeline recently, and they don't have a great answer to Lily's forthcoming obesity pill, creating concern that Novo will lose its first mover advantage and not be able to compete into the next decade. Scott.

Angelica, thank you. Angelica Peebles. All right, Julia, it seems like investors, when they want to play offense, they buy Netflix. When they want to play defense, they buy Netflix. Netflix, another all-time high today. Another all-time high day. The stock's now up 95% in the past year and 24% since its better than expected earnings last month.

Analysts reacting this week to Netflix's upfront ad presentation on Wednesday, where the company announced 94 million users for its ad-supported tier. That's up 34% from November. Analysts, 70% of whom have a buyer overweight rating on the stock, pointing to the new ad tech tools the company showcased, including generative AI-powered ad formats, saying they'll help drive growth. Baird's saying, quote, we think Netflix's rate of progress in building its advertising infrastructure is encouraging, and it seems like many of the pieces are coming together to enable long-term growth. A number of analysts flagging the potential in a new user interface to increase engagement as well.

All right, Julia. Thank you. That's Julia Borstin. Mike, less than two to go. I mean, it's rare that you see a stock that plays both sides of the game, offense and defense. I mean, Apple and some of the mega caps have done that from time to time, but this has been a remarkable run. It has. It's because it's the combination of a leader in a fast-growing group that also is super predictable, at least based on everybody's, you know, everybody's earnings model now is singing to them based on what's gonna happen with ad support.

And now, it's getting to be really rich, right? It's gonna get, it's gonna be a 40 times earnings-type company. That's not necessarily way out of whack, which where some of these others have traded. But it's interesting how much of a premium it is now to the likes of the Mag 7, most of the Mag 7 already, just because of that predictability. And of course, it's not as big market cap wise. So we've come back a long way as we said this week and you noted it.

We're better than 5% on the S&P this week. The Nasdaq's up 7%. Now we're positive year to date by one and a quarter percent on the S&P this week. The Nasdaq's up seven percent. Now we're positive year to date by one and a quarter percent on the S&P and during this program we went green for the Dow too. Obviously UNH is having a nice move today as well, but that's something to mark as well. There's not a lot ahead of us inside from the old highs which are 61-40-ish on the S&P 500. So still a few percent to get there.

Look, it's a lot to ask. I think after six weeks of straight one way upside action, I'm looking for signs that it's getting overdone. Looking for signs we ought to pull back. It's an options expiration today. We'll see maybe if we have to have a little more two way action next week, but really it's been unassailable.

This is the rhythm of this rally this week. NVIDIA earnings are still lurking out there too. We'll start talking about those as those grow even closer. Enjoy the weekend. I'll see you on the other side. Let's send it into overtime with Morgan.