Closing Bell - Closing Bell: 5/21/26

Episode Date: May 21, 2026

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, Melissa Lee 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.

Welcome to Closing Bell. I'm Scott Wapner live from Post 9 here at the New York Stock Exchange, and this maker breakout begins with a new and more bullish outlook from one well-known market watcher. He's sitting on my left. He's Chris Harvey. We're going to bring him in in a moment with his big new number for the S&P. Let's show you the scorecard, though, with 60 to go in regulation. We're mixed now. The market's been a little volatile this afternoon. Dow still green, S&P and Nazar Red, Russell getting a little bit of a lift. We're kind of looking at everything to do. day. We're looking at oil. We're looking at yields. We're thinking about Nvidia after its earnings report. And what that means to the AI trade in general, the stock usually doesn't do too much on the back side of the print.

Not doing it yet again. We'll watch it. Arm is. Arms higher. Apple, meta, alphabet, Amazon, well, they've been higher as well. Oh, alphabet as you see as the market's taking a little bit of a dip as following soup there, too. Walmart shares down sharply after its earnings and cautious consumer commentary. We'll keep an eye on that name. And now we've learned a lot more about that SpaceX IPO, learning more about its business. We'll talk to top venture capitalist Lottoni coming up on whether you should buy into that IPO. It does take us to our talk of the tape. Growing more bullish. As I said, that's what Chris Harvey of Wells Fargo Securities is becoming today. Oh, oh yeah, C-IBC. I'm sorry. Thank you. That's okay. What happens? We didn't catch that. Not to me, but it happens. That's my bad. Your new gig. Are you okay?

Yeah. Can you continue? I mean, I recovered okay. Are you all right? I'm fine. All right. C-IBC Capital Markets, the managing director and the head of equity and portfolio strategy. Yes, I am. All right. We saved you. Saved you. Save me. We're good. All right. So you raise your outlook. Yes. 8,020 from 7450. Yep. Why? Why? Because earnings were so much better than we expected. When we put the numbers together back in November,

we thought things would peak about mid-year, that's not happening. And we thought we'd see a deceleration in 27. I don't think that's happening either. In addition to that, the macro factors, oil and rates, we think they're skewed to the downside. If you look at oil, if we're deadlocked, if we don't go much further, you'll have incremental gains up. We get some sort of resolution.

You're going to see a big, a meaningful drop down. And the same thing for rates. In addition to that, rates, 10-year yields got to 470, they couldn't break equities. Part of your point is that bonds gave stocks their best shot or yields did, and the market was able to withstand that. They were a tough lot, at least for now. Well, for now, but what pushed up yields was real rates, and those aren't as sticky as break-evens. And so we're pretty comfortable, and there are a couple things that pushed them up. So we're pretty comfortable that we're not going to see $470 or $4.70 or $1.00.

so, we'll actually probably see rates kind of level out as people get comfortable here and folks start to step in and buy. If rates level but stay where they are, that's not a problem? Not a problem. What's happening is the credit market's on fire. You can do M&A activities picking up much faster than I would have expected. We're going to get some word from Kevin Warsh relatively soon. He'll be, I think he's appointed on Friday, what we're sworn in on Friday. Yeah, tomorrow. Tomorrow.

And then he'll have his first meeting in a couple weeks. We'll find out more about his stance. I think it's going to be not a radical change, but a difference. What are you waiting to find? Don't you know what his stance is going to be? No, I don't think we do. And I think when he walks in, he may be. So what Powell said is, hey, things are neutral or slightly tight.

Worse may come in and say things are tighter than what Powell told you. And we think that our star is lower than what he said. And that's a very different conversation. Yeah, but he could say that, but he can't hit the button himself and cut rates. And there's a decidedly more hawkish tilt in the Fed now. All fair, right? But let's line this up. Let's see, because I do think that the probability of market meltup is increasing.

And here's the way we get there. If we get some sort of resolution between U.S. and Iran and oil starts flowing, what do you do? You say, hey, this is a supply shock. We can look through this supply shock. If we think Fed funds are more restrictive, then we can start to be more aggressive. We do that, then suddenly things like arms, things like key locks, things like auto loans become much more attractive. You start to pull in the consumer. Consumer has more capacity. They start tapping the equity in their house. I mean, that's the dream, but that's a lot of ifs. A lot of is, but it's not that far away. All you have to do is get resolution. And it looks like we're getting.

getting there and you begin to open the door. And the emanating the IPO activity, it is starting to stir animal spirit. What about the AI trade? Like, how do you assess where we are in that now that we can digest every earnings report that matters now that NVIDIA is reported? I would say we're probably in the sixth, seventh inning of this. I think it still goes on. I think it's still the best secular trade out there.

We still like it. Six, seven innings. Okay. That sounds later than people are talking. about. Are you going to extra innings? Well, it depends how long the endings last. Yeah, that's true. I mean, where people are saying, you know, you have a, you could have another year or two. I think it means that implies you're not in the sixth or seventh inning. Yeah. So if we go back, let's look at it this way. We go back to

1998 and you had things like level three, global crossing IPO. And you had the peak about 18 months later. Now we're starting to see things like glow, um, uh, what is the IP? SpaceX, and a few others being talked about, that may indicate you've got about 18 months left. That's still a pretty good runway. And we had a very big run in 99 and into 2000, so things can get very funny very quickly. What about the broadening of the market?

So if you think rates have sort of topped out, right, and you think oil's kind of topped out, if those two things come down, Yep. Is that the thing that spurs the broadening trade? That is, I agree with that. That is a thing that broadens the trade. In addition to that, that's the thing that helps the melt up, because if you start to bring rates down, you broaden out that trade. AI is still a great trade, the momentum trade, while it's wiggle a little bit, I think is still in full force. Oh, so it becomes an everything rally. And everything rally

other than defensives, which is kind of what you're seeing today. How are you thinking about, you know, What if the Middle East, I don't know, look, there could be a resolution at any minute. Could be. We really don't know. You know, the president puts on social media, you know, whenever he wants to, ostensibly, we're either close to a deal, you know, we don't, whatever. You know what I mean? Yeah. And the market reacts accordingly.

So you always have to have that in the back of your mind. That's right. But what if we don't get a deal? But what if we say we have a deal, but we really don't have a deal. You know what I'm getting at? Yeah, yeah, no, I know exactly what you're getting at. Yeah, no, I know exactly what you're getting at. So what makes us more comfortable is what we're doing is if you want to create leverage in the situation,

the best way to do it is to go after the money, to attack the money. That's what we're doing. We're starting to go after those petro dollars. And if we just sit and wait, that creates more pain and more stress as we go forward in time. I think that's the best strategy. Don't keep the military out of it. Don't do anything aggressive. Just sit and wait and keep the flow.

of money and oil from happening. That's going to help build your case. And what did we see the other day? There was talk about a coalition with NATO, right? The narrative is now beginning to change. Hey, we have to open up the straight. Hey, we have to do things. Other people are coming in.

That's a very different story. No, but there's a lot of talk. We need, like, action. We need resolution. That the market believes. Right. Then the market, well, I think the market is beginning to believe. We are up eight or nine percent year to date.

that's a pretty good figure to begin with. Okay, so if we get the broadening and we can get, you know, over 8,000, like you said, what's the unloved area of the market right now that's going to help get us there? The unloved area is consumer and housing, right? Consumer and housing is the contrarian trade at this point in time. If you look at the Home Depot, the lows, some of the home builders, you look at some of the consumer stocks, they just haven't performed the way the rest of the market. For obvious reasons.

Right. I have Diana Oleg on yesterday telling me the mortgage rate, are back towards the levels we haven't seen in fill in the blank. Right. And so, again, if you start, if people start to believe that the Fed is not going to hike, but to potentially ease down the road, those rates can change very dramatically. Are you still banking on a cut? Well, what I'm banking on, we do believe there's a cut in 26?

In 26. Yep, late 26. You say it with a little bit of a spot, because you know it sounds a little. Yeah, no, everybody, that's still a long time. And the thing that we bank on, too, is you're pricing in a hike already. I want to bet the other way on that. I don't think there's a hike here. I think there's an easing,

or at the very least, you have to take out that tightening. In addition to that, the other thing that people talk about, right, and they say, well, there's going to be a tightening

and the equity market's going to roll over. But you go back to 99,000, that didn't occur. When the Fed tightened, tech growth was all up 20, 40, 50, 60%, right? I mean, the noise in that worse

is going to get sworn in tomorrow. Right. It might as well be, you know, put your hand in the air and say, I, I, I promise to cut rates the whole rate and nothing but the rates so help me, you know what. No, but no. They're not going to hike. No, he's not going to, he's not going to hike, right? And he cannot do any, the situation does not dictate anything but staying pat. It dictates being vigilant, um, watching. But again, if things fall correctly, you have to price that hike out. and you probably have to price in and ease it. All right. I appreciate it very much. C-IBC Capital Markets, Managing Director and Head of Equity and Portfolio Strategy, Chris Harvey.

Thank you. We're still good. I mean, you are. I don't know about me, but anyway, thank you. Thank you. All right. Now to Nvidia. That stock, as we said, not doing all that much after another stellar earnings report. But Bernstein's star analyst, Stacey Raskon, he raised his price target. And he joins us now, Sons the Jensen Wong shirt, but you raise a price target, so you're all in, no matter what. What did you see that led you to do it, albeit $15, $3.15 from $300? I mean, our earnings went up. It was actually a great print, right? I mean, so it was a really solid beaten raise. I know the stocks, it's down a little bit, but it's basically doing, you know, most of nothing in the trading today. But I mean, I think the guidance sort of meter, you know,

maybe even exceeded a little bit, the whispers. People wanted to see a 90 billion-plus guide. They guided 91. There's a CPU opportunity that they're now talking about. They talked about potentially $20 billion of CPU revenue just this year. That would just be coming into the second half, so it implies, to me, an annual run rate that's even higher. I think there was plenty of reason to take numbers up.

I don't think the data center trade and trajectory is finished yet by a mile. And, look, I think everything else that's going on in the space, you know, everybody's been playing all these other news. we've talked about this before, whether it's memory or semi-cap or optical or seek news or whatever, but like none of it works without Nvidia. Invidia seems to be doing just fine. That's why our target went up.

Our numbers went up short. So if that's the case, I thought there was a really interesting piece today in the journal. They're heard on the street column, which you may have seen. Even at $5 trillion in market cap, invidia's underappreciated. You're kind of saying the same thing, aren't you, that do you think there's too much apathy around this name that because it's not the shining new thing, the shiny new thing

that people are taking all of this incredibleness for granted? A little bit, right? Yeah. So, I mean, people have preferred the last, you know, six to 12 months to play the things that I think were perceived as having more torque. And again, I mean, one just simple example, you can look at memory pricing going parabolic, right? And Invidia had its day in the sun where you seeing earnings like, you know, go up an order of magnitude. Like it's $5 trillion.

You're not seeing it going up 10x from here, which I understand. But at the same time, I mean, I can't even remember what they grew year over year or 80% or something like that, which is unheard of for something of this size. And I mean, they're actually still accelerating, like not decelerating. and they're sort of at the fundamental of everything else that is going on like whether you're playing like I said memory or semi-cap or anything else is like an AI derivative

none of it works if if Nvidia doesn't and it sort of opens up this interesting dichotomy between the two groups the sort of the AI constraints and the AI compute like one of them has to be wrong I think and so we've actually really liked

Nvidia partially on that sort of opportunity for ketchup for the normalize the multiple to normalize once people can kind of wrap their head around hopefully what may be coming down the pipeline. I mean, you figure on a real kind of number, Nvidia is probably trading mid-teens or earnings for a growth profile that I think is unprecedented. Yeah, we like it a lot. I think there's still a lot of opportunity here.

What do you think about the buyback and the dividend announcement? Yeah. Yeah, so, I mean, they've been buying back stock anyways, and they talked about a GTC that they would return half of their free cash flow this year, which, I mean, this year would be in the ballpark of $100 billion. And so they announced an $80 billion buyback and a roughly 20 or $25 billion increase to the dividend. They went from a penny a share, which was nominal to $0.25 a share on a quarterly basis.

So it's a good problem to have. Like, they're generating so much cash. I mean, OPEX is going up. They're investing in the supply chain. They're securing supply. And they're also making a lot of, as we know, strategic investments in a lot of other players in the space. and they've still got more cash when they know what to do with. So, I mean, at the end of the day, you know,

they're not letting it pile up. They'll give it back. I think it's a good problem to have. What about China? Lastly and quickly, if you could. I mean, they seeded it, as they said. Does that matter? Well, at this point, like,

is at least they've taken it out, so nobody's looking for China for growth. I think it's a shame. I am in Jensen's camp here. I think it's better for them to be able to compete there than not because you really don't want to encourage the growth of local ecosystems. At the end of the day, there's not much that they can do.

I do think the Chinese customers do want to use their part. So maybe they'll be allowed. Maybe they won't. But at this point, I think it's safest just to leave it out of the model. And if anything does come, it's upside. But at least it's not downside in the near term. Okay. Stace, thanks.

Appreciate it. Nice to have you on both sides of this print. Stacey Raskon. Meantime, we're learning more about SpaceX's business today. As the company officially files to go public, Leslie Picker, been following the money all along and joins us now with more. Hey, Scott, yeah, Elon Musk is really the poster child of meme-driven market influence, and he's leaning into his retail following with the SpaceX IPO. Reports have suggested that SpaceX could allocate about a third of the IPO to retail investors.

I've been told that's directionally accurate. In the IPO perspective is disclosed yesterday, SpaceX said it plans to offer shares to retail investors through Charles Schwab and Fidelity and Robin Hood and SoFi through their own brokerage platforms. the company also intends to offer stock through e-trade, a division of Morgan Stanley, one of the lead underwriters. SpaceX cautioned in the prospect is that the trading of its Class A stock may be volatile because, among other things, it plans to allocate a, quote, number of shares to retail investors in the offering. The company also said in the S-1 that, quote,

high retail investor interest in our Class A common stock may occur following this offering, which may lead to increased volatility of the trading price, Scott. Leslie, thank you very much. That is Leslie Picker. Now to Star Venture Capitalist, Lo, Tony, joins us once again. Good to have you back. How are you? Thanks for having me.

Feeling great. So what do you think about what we learned? I mean, the obvious numbers jump out. This wild number of Tam that they think they have. What was it, $24 trillion or something like that? What's your biggest takeaway? Well, I think my biggest takeaway, and especially just hearing some of the guys,

guests that have been on your show and the others on CNBC is that the market is initially misunderstanding what category to place SpaceX in space, Starlink broadband, defense, AI adjacent. But really, going through the filing, really validated something that I said on your show last week is SpaceX is increasingly becoming a vertically integrated AI infrastructure company. and it's now explicitly using that framing. So the key insight is that Elon believes the next bottleneck in AI is no longer chips. It may be power, land permitting physical infrastructure. And so SpaceX is vertically integrating downward into those bottlenecks.

And this is the same thing that Google did when it integrated downward into TPUs, their custom silicon when compute became strategic. But here's the key difference. Google vertically integrated inside of the data center, and SpaceX may be trying to vertically integrate below the data center with launch, energy, orbital infrastructure, communications, and maybe even silicon at some point. And that's why this filing is important. So you say orbital infrastructure, you're talking about data centers in space, right? Which is in part at least. and that is sort of what, you know, Jeff Bezos addressed that yesterday in the fabulous

interview that we had on, on this network. Amazing. He like, he, he, he tempered your expectations, I guess, of time frame. While he's as optimistic and bullish on that idea as anybody else was like, well, it's not going to be as fast as people think. And if you want it to be in six years, just say you're going to do it in three, implying it's going to take a while. Are we assuming that these.

literal moon shots are going to be faster than they may be? Well, without a doubt, it's important to listen to what Jeff has to say, because really, he's the only executive that has deep experience with both a hyperscaler that has done vertical integration in Amazon and in space with his company, Blue Origin. So I think his point is, you know, look at the economics he pointed to when the cost exceeds the energy cost exceeds 15%. And I think that's important because without question, the timing is absolutely uncertain. But the important point is the strategic direction in the filing. And so, you know, again, this points to Elon's belief that the terrestrial AI infrastructure may

eventually hit power grid constraints. And so orbital compute is a long-term response to that possibility. But yes, we do not know the specifics of the timeline. Okay. I want you to listen to what Bezos told Andrew Ross Sorkin about the idea of similarities between now and back in 99 when he had a front row seat as well to euphoria, parabolic moves in the market. Listen to what he said. We can talk on the other side. We're in a phase where every experiment is getting funded. So what that means is the, like the good ideas are getting funded and the bad ideas are getting funded. And it's because investors in this, at this moment,

haven't learned yet how to discriminate between good ideas and bad ideas. And that's okay. Because the good ideas will pay for all of the losers. So from a point of view of civilization, of society, these kind of industrial, you know, cycles, you know, are, can actually be very healthy because they drive the technology forward. And so we shouldn't worry about being in a bubble. No, even if it does turn out to be a bubble,

you shouldn't worry about it. Because the bubble is driving investment, and a lot of the investment is going to turn out to be very healthy. Okay, so that was an interesting take. As a venture capitalist, you theoretically are one of the funders of good ideas, you think, and hopefully not bad ideas. But what do you make of what he said?

It's the paradox of when things get to the point where we see massive platform shifts, you have this euphoria. And to Jeff's point, this is so true. And we've seen it happen and play out multiple times. And I think Jeff is right. There is something to be said about the focus on a bubble typically are all the negative aspects, especially when the bubble pops. It's rare for people to point out what Jeff did so well,

which is that it is important for a large number of other bets to get funded because there will be some extraordinary winners. But again, it is important to point out that not all of these bets are going to play off. I mean, that's in essence the business of venture capital. You know, you have a few things that don't work out in the hopes that you can invest into a SpaceX or an anthropic or a data bricks. but I would imagine in the current environment, as the, you know, as later we theoretically get in the stage process, you're being more discriminating about what you're actually funding,

thinking about exactly what he's talking about, hoping to have more hits than misses. Absolutely. And then it becomes much more discerning as an investor to be able to filter through the massive number of competitors that get funded that probably should not get, funded and then also having to help your companies go through the process of attracting the best talent when that talent pool gets diluted because so many other companies are chasing all of these other employees. So it does become tough. And I mean, this is why the companies that ultimately become successful reap the rewards. All right, good stuff. As always, Lowe thanks. We'll talk to you soon. Low Tony. Let's send it now to see Momody for a look at the

biggest names moving into the close today. Hi. Hey, Scott, we've got our eyes on Spotify soaring after it reported strong guidance and announced an AI partnership with Universal Music. As part of the deal, the stream will allow users to create covers and remixes using the voices of artists and songwriters who opt in. Shares up 12%, almost 13. Meantime, Deer shares are sliding after reporting sluggish farm machinery sales for the quarter. The company maintaining its profit outlook and recovering over $270 million in tariff refund claims yet. The stock is down about 6%. and Intuit shares plunging despite raising its fullier guidance.

The concerns really center around a deceleration in turbotax sales due to weakness in the low-end tax filer. Intuit confirming a 17% reduction in workforce. CEO Sussing Goodrazi telling me that 3,000 job kits are not due to AI but an opportunity to become leaner, but shares are down about 20% of five-year low, Scott. All right, good stuff. Seema, thank you very much. Seymod, we're just getting started coming up next to Quantum Leap. Several stocks are making that today. I'll tell you why.

We're live with the New York Stock Exchange. You're watching Closing Bell on CNBC. Welcome back to the Bell. Quantum Computing stocks are rally today, as the Trump administration makes a big bet on that space. Let's get to Christina Parts of Nevelos, who can give us more details here. Tell us why these stocks are moving to the degree they are.

Yeah, a big bet. And the big bet is the Commerce Department dropping $2 billion across nine quantum computing names and is also taking equity stakes in all of them. So IBM gets the biggest change. check at one billion bucks matched with another billion dollars of its own to launch a standalone quantum foundry. Global foundries gets roughly 375 million. The rest that you're seeing on your screen, D-Wave, Raghetti, etc., are splitting the remainder, all funded through this Chips and Science Act.

Every deal, though, pairs funding with an equity stake back to the government. We've seen this playbook before with Intel, Vulcan elements, MP materials, but this is the first time Washington has applied it across an entire emerging sector. And the government isn't necessarily picking winners. The nine companies use different approaches to building quantum hardware, though I'll have to say IBM is definitely getting half the total package. So maybe perhaps that's the preferred one. For an industry long dismissed as maybe a science product,

so far away into the future, $2 billion with equity attached changes the conversation. Washington is essentially treating quantum the way it treats chips and critical minerals as a national security. The deals aren't yet finalized, though, but the stocks, as you mentioned, Scott, are moving. Washington at this point just isn't writing checks anymore. It really wants a return.

Yeah, investors aren't waiting around for more details. Christina thanks. Christina Parts of Nebula. Still ahead, Fundstrat's Tom Lee. He joins us. What is the next big move for stocks? He'll tell us next. Welcome back.

We are mixed. Well, now we're higher as we head towards the close. now that Nvidia earnings are out of the way, is the AI trade about to take its next leg higher. Let's ask Tom Lee, he's Fund Stratt's head of research. Welcome back. So how do you assess this now? We've cleared the way, right? All the AI stuff's now out of the way. We're looking at yields. We're looking at oil. We're looking at the Middle East. But how do you feel about this market? When you just heard Chris Harvey at the top of our show saying, we're going to have an everything rally that's going to take us past 8,000 by the end of the year. Yeah, Scott, I think the market is pretty healthy. It showed resilience in the face of higher oil, higher yields. But I also think the U.S. is pretty unique because we do have a structural driver for the economy, which is not only as the U.S., the producer of AI, but we are also relatively energy independent, and that's been exposed by this war. And the consumer is in pretty good shape. So I mean, I think there is a pretty good runway.

So I'd agree with the idea that stocks, compared to the start of this year, have more upside into your end. We've got a few things we have to work through as we get later through the year. But I think for now the fundamentals are healthy and that's supported by earnings. I don't know what shape the consumer is in, to be honest with you. I mean, I understand the K-shaped economy, obviously. Top of the K is better than the bottom of the K in terms of the durability to keep spending. But you listen to Walmart, which was pretty cautious. And you're like, what is the real estate of the consumer?

And if oil prices remain elevated for too long, is that the thing that wrecks the story? Scott, yeah, in a way it is case-shaped, because if I had to say, okay, what are the things that are sort of ballasts and things moving to consumer, of course we know that it's higher gasoline, higher food, and of course there's gonna be a shortage

of some petroleum products. But on the other end of that spectrum is, you know, the wealth that's gonna be created by the IPO SpaceX, opening, at, et cetera. I mean, that's several trillion dollars worth. And as we know, there's like a marginal propensity to consume from the wealth effect. So I think the consumer is getting a tail one later this year, but a lot of it is for those who own equity. I mean, a tail one from the, from owning the IPOs? Well, it's actually the private investors. As we know, SpaceX was probably seated at, you know,

$50 million. It probably raised, you know, tens of billions over the last decade, but now it's going to have a net worth valuation of around $1.7 trillion. So that's actually now going to be monetized for the LPs of the funds that invested in SpaceX. So there, you know, several trillion dollars is quite a lot of stimulus to the economy. Wow. Okay. Hampton's real estate market, watch out.

AI trade. How do you feel about it after Nvidia? I mean, a company with the size of revenues, NVIDIA, growing at a percent, I think it shows that there is still, you know, unrelenting demand for the product Nvidia sells. And then we know that those who are starting to use AI

are actually noticing of a gain of function on productivity. You know, Ken Griffin really stated it well when he says he could see it's replacing a lot of analysts. So to me, I think not only are the users of AI, benefiting, but there's still a shortage of those who are supplying the equipment. But aren't you still calling for a pullback in stocks and something meaningful? Like the one we had already didn't really qualify, if you will, under what you were thinking could happen, right?

That's right, Scott. I think we had, like what Ed Yardini would call a rolling bear market and things like Mag 7 and, of course, last year in energy, but in software, etc. but I think later this year, the market is going to confront a few things. One, of course, is just your typical midterm seasonality, you know, the uncertainty into that. The second is that there is a day of reckoning coming

because the inventory of petroleum of petroleum products is short and not being alleviated anytime soon. And the third is we probably have some concerns later as these IPOs come, SpaceX, OpenAI, etc., that there's a lockup expiration later. So I think that's a supply overhang. So I think that dynamic comes to play later this year. But in the meantime, I think investors are focusing on AI fundamentals.

And there's a real shortage. And stocks that are working are the ones that are selling something that's scarce. Tom, I want to make sure I heard you right. Are you calling for a rolling bear market in Mag 7 names? Because is that what you're looking for? You look for these stocks to become weaker at some point and dramatically so at some point this year? Is that what I heard you say? To clarify, I think we've already had a bear market in Mag 7 and software.

I think there's going to be a fair market in other stocks later this year, yes. But I think it's going to spare the Meg 7 and software. So it's going to be names that either got lofty or are going to be affected by the fact that there is a lot of supply of new stock later this year or the companies that are going to get hit by the shortage in petroleum products. So I think there's reasons that we could have headwins later this year. Are you talking about like semiconductor stocks? Yeah, semis may become a bubble. They're, to me, they don't seem like a bubble yet.

You know, when Nvidia is trading at 19 times earnings, I think it's still a good risk reward. But I think that there are hearts of that ecosystem that become quite expensive. And you think that those stocks could could go down 20,000, percent later this year yes you know i mean it's uh it would be healthy anyways um you know a 10 percent drawdown happens every year i think what we found as investors have become so comfortable with stocks going up that even a 5 percent drawdown current sentiment negative so i think there's easily a possibility that names that are widely owned sometime later this year are going to have

a drawdown that triggers a bit of a margin liquidation and that's why we might have a bigger correction. I got to let you go, but remind our viewers what your end of year target is for the S&P. We expect the S&P to be at least 7,700 by year end. I think that number seems low, given the resilience of markets in the face of high oil. So I think 7,700 is the low end. Oh, okay. All right. We'll talk to you soon. Tom, thanks. Thanks. Coming up next, the biggest movers as we head into the close, Simomodi is standing by with Matt, tell us, please. Scott, SpaceX's S-1 is already moving certain stocks, including one competitor will reveal the name after the short break. All right, about 10 from the bell. Well, almost.

Let's get back to Seema for the stocks she's watching. My counting was a little bad. Seema. Great. 13 right there. Ralph Lauren shares are soaring after reported better than expected results. Scott, the retailer is seeing a boost from strong sales in China during the Lunar New Year, with sales climbing about 50% in the market. Shares are up about 14. percent best day in more than a year. How about that? Walmart, though, on pace for its worst day since 2023 after posting a worse than expected outlook. The company said higher fuel prices, putting pressure on the lower income consumer, but could also help Walmart gain market share as sharpers seek those lower prices, the stock down about 7%. And here's Rocket Lab. Shares are sliding after SpaceX

filed its S-1 with the SEC to trade publicly on the NASDAQ. Company is set to feed the record for the largest IPO ever, Rocket Lab investors. Clearly, concerned. about growing competition in the industry, Scott, which shares down about 7.5%. Okay, Seema, thank you very much for that. That is Sima Modi coming up. Why shares of Bloom Energy and Nebius are ripping today. Plus, workday is preparing to report its results. Top of the hour. We'll tell you what to watch for in the market zone, which is coming up next. All right, we're now in the closing about market zone. Mike Santoli and PNC's young Yuma are here to break down these crucial moments of this trading day. Plus, Oliver Renick is standing by live from

the Cibo Global Markets in Chicago, watching the options action today in IBM. Sima Modi looking at workday as it gets set to report Pippa Stevens as checking shares of Bloom, energy ripping higher on some deal news. Michael, I'll begin with you. Your thoughts on the market today? You know, we keep having these dry runs, Scott, you know, some kind of a headline that suggests de-escalation, reopening of the straight. And then the reflex move yesterday and today is, obviously, you know, softening up of oil prices, yields ease back a little bit. The broader list of stocks starts to gain a little bit of ground relative to the mega-cap winners, and then we fade when there's no confirmation.

But I think that gives you a little bit of a window on maybe how things might trade if we, in fact, get something that seems durable. Over there, meantime, super low correlation tape, high dispersion, half stocks up, half down, that's enabled it to absorb, you know, the dent in Walmart and the sell the news in vintuitive stuff starts to crackle around the edges. That's what's driving to Russell. That's not real economy, small companies. That's spec stuff. You know, we talk about the quantum and alt energy stuff. And that's sort of an interesting mix in this market that's all blending together to be kind of steady and lukewarm. You're less than seven minutes away from overtime. What do you guys

have coming up? Yeah, I mean, obviously we got a couple of interesting earnings. You're going to preview there. And also we have a fixed income manager who's going to talk about why the AI boom might actually be sort of a risk to the bond market longer term. We'll get into that a fair bit, all these unintended consequences of the site. All right, good stuff. I'll see you in Mel Top de hour, four o'clock Eastern time. Oliver, tell me about IBM, because I mean the stock's having a great day. What kind of options activity are you seeing at the CBO? Amazing day for the stock.

Options traders storming into what might be the ultimate quantum play. Hiding in plain sight, Scott, almost 200,000 contracts on pace for 15 times the daily average of the past 30 days. Calls are outpacing puts nearly 8 to 1. More than 42,000 calls were bought, almost twice the number sold, and compared to less than 4,000 puts. The most popular contract by dollar amount is the $260 strike call expiring late August. Thanks in part to someone who spent just over $1.5 million

buying $1,000 of those contracts. To break even on that trade, they need a 10% bounce by August 21st. It's understandable optimism if you compare the government's $1 billion grant to IBM with its investment into Intel, which is up roughly 500% cents. If there's two things, traders love right now, it's cutting-edge tech and an all-American comeback story. just with a little help from the government maybe. Yeah, good point. Oliver, thanks. Oliver Renick. All right, Seema, workday.

We've obviously been watching a lot of software stocks these days. Tell us about this one. Well, Scott, the stock is down about 40% this year. So it's really become a show me story on Wall Street ever since it brought back founder O'Neill Brewstery as CEO to reboot the company amid AI competitive fears. In fact, in the Wall Street Journal interview today, Boussri says he's overhauled its AI agent portfolio

with 15 new agents in 2026 in the corporate travel and ITC. space. We'll want more details tonight on how Workday's new lineup of agents could challenge the likes of service now and its ability to partner versus compete with Open AI and Anthropic. That's been a key topic. As we saw with Intuit, the market has little patience for any signs of weakness in the enterprise consumer, Scott. Seema, thank you. All right, Pippa Bloom and Nebius. What's going on there today? Well, Scott, Bloom Energy is jumping some 9% to an all-time high after the company announced a partnership with AI cloud provider Nebius,

whom will provide its fuel cell technology for Nebius's U.S. data centers with the company paying the energy provider up to $2.6 billion in service fees for the duration of the agreement. The first project is expected to be operational this year, and this does mark Bloom's latest AI deal following an expanded agreement with Oracle

back in April for 2.8 gigawatts of fuel cells. Bloom shares have more than tripled this year as demand for reliable power for AI applicants. locations surges. Nebea shares up some 14% today on the deal. Scott? Well, well, Pippa, thank you very much. That is Pippa Stevens, a young Yuma who joins us now. Your thoughts on how this market has traded today after NVIDIA. Yeah, thanks, Scott. It's great to be here. It is a choppy market. I think there's a lot of dispersion, as Mike mentioned, but there are some themes that are very strong here.

And the theme of the KAPX spending, the AI buildout is very robust. And I think what's important for investors to remember, we're going to have short-term sensitivity to interest rates, to Fed considerations. So what's happening in oil markets in the Middle East. But in the medium and long-term, the strength of this build-out is really what's going to drive the market higher here. And we only see two possibilities of the market

and this medium and long-term trend getting derailed. And that is, one, with the possibility sharply higher interest rates, or two, something that actually confronts CAPEX head on and causes it to stumble. So we think it's important for investors to think about these medium-term drivers and how strong they are and not to get kind of caught up

in some of the day-to-day sensitivity that the market has here. Are you a stay with the AI trade or start to play for the broadening theme? I'm going to stay with the AI trade here. This is where the strength is. There's a lot of dispersion under the hood. The broadening was more under consideration

when the consumer looked stronger and we didn't have some of these inflation pressures that are working their way through the system right now. I think the strength that we're seeing is where you want to lean into. There's a lot of cash on the sidelines. There's a lot of cash on balance sheets. There's a lot of cash in private markets.

And so much of this is pointing in one direction. So you want to continue to lean into this, but also globally, not just the U.S., but tech globally in Asia and Europe as well. Sure, but if you think that rates and oil are going to come down, I mean, if that is part of someone's narrative, that would theoretically spur money into the broadening trade, wouldn't it? Are you not expecting those things to happen?

We're not hanging our hat on rates and oil coming down. If we get some type of partial resolution with Iran, oil and rates could stay around the levels where they are now, or only come down modestly, and that might not give the type of balance that we would hope for in that broadening trade. So we really want to stick with what we see as more durable. If those things happen, great. I think we would take that as kind of extra icing on the cake here. But right now we want to stick with what we see is the most durable, most reliable

trend. But does that mean you only like tech and comm services or just anything with the theme around AI? Look, there's a lot that plays into this. As was just mentioned, with clean energy, the energy security, energy infrastructure, infrastructure broadly, there are a lot of companies that are benefiting from the cycle. And there will be a broadening cycle as more companies get productivity benefits from AI. But that's a slow and gradual process.

There will definitely be a time for the broadening theme to take full. But it's probably a little bit too early amid this higher inflation, amid higher prices, high oil prices, gas prices to really hang your hat on the broadening theme until there's more clarity there. Good stuff. It's actually soon. Yung Nguyenla PNC. Thank you very much. So we've turned green across the board.

And that's the way we're going to go out. As a dog raised today, we've 50,000, almost 300 on the Dow, and you see the SEC, Naz and Russell also settling out with pretty decent dough. I'll see tomorrow.