Closing Bell - Closing Bell 6/12/25

Episode Date: June 12, 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.

All right guys thanks so much. Welcome to Closing Bell. I'm Scott Wobber live from Post9 here at the New York Stock Exchange. This Make or Breakout begins with stocks chasing new highs. Whether we'll get there and then more importantly what might happen next. We'll ask our experts over this final stretch including JP Morgan's Gibranco Lakers. They'll join us momentarily. Here is the scorecard with 60 to go in regulation on this Thursday. Stocks trying to pick up a bit as the day has progressed. Have some optimism over trade and perhaps coming rate cuts to playing a role in all of that tech. It's the best sector today Microsoft hitting get another new high video and Apple green as well.

And there's Oracle surging after its earnings report today. We'll tell you more about that 14 percent move why it is happening so large today a little bit later. why it is happening so large today a little bit later. And we do have another IPO going, Gangbusters Chime soaring in its first day of trade at the NASDAQ, there it is, better than 39%. It takes us to our talk of the tape. Whether it is in fact time to get more bullish on these markets as altimeters Brad Gerstner

told us earlier today. You will hear his reasons why in just a moment. Let's now welcome in Ellen Zentner of Morgan Stanley and Schwab's Kevin Gordon both as you see here with us at Post 9. It's great to have you both. Hi Scott. Ellen you say there is a bull case for stocks but it's plausible not probable. Why? Yeah of course. Well I think that April 8th started a new bull market right right, up 20 percent. And there's, I think markets are going to struggle for a narrative to hang onto here. I don't think we're past the trade uncertainty.

I don't think we've gotten any more certainty, period, on anything, whether how much inflation is still to come, labor market weakness is still to come, uncertainty over whether the Fed will cut this year or not. And so I just don't think there's a whole lot to drive that bull market narrative further. You also think the bar is high. Yeah, I think it's high because, I mean, when you look at what plunged us into the bear market territory on a closing basis, not for the S&P,

but at least on an intraday basis, we can use that as a metric. But, you know, it was the fact that we did have tariffs on basically everyone in the world, but also many sectors. But the second aspect of that was because they were so aggressive in nature. So we've dialed back the aggression, but you still have the tariff aspect. And now the market has to figure out how to price in something akin to maybe a 15% effective tariff rate, which I know that can change in 10 minutes.

But as of now, you're looking at a double digit tariff rate that is still pretty restrictive for many U.S. companies. I think the bar is high because of that, but also because with the rebound that you've seen since the April 8th flows, the S&P 500s, forward PE, and many valuation metrics in addition to that have basically come back to cycle an all-time high. So there's just a little bit less juice to squeeze out of that multiple expansion fruit. Okay, I had the investor Brad Gerstner of Altimeter on halftime earlier today. He said not time to hedge.

He said time to get much more bullish and he listed the reasons. I want you to watch this. We'll react on the other side. We have the AI super cycle. We've seen a re acceleration in both the top line and the earnings. You know, Oracle reported last night blockbuster numbers. 80% of the S&P that reported all beat the Mag-7, all beat and accelerated. And so I think that, you know, so long as the government

does these things that I describe, I think the economy is ready to cook. We have these rate cuts coming in the back half of the year. So I think that's the potential trifecta for this economy, an incredible pro-growth administration that is landing the plane on tariffs, that is landing the plane on the reconciliation bill, and we have rate cuts ahead. That caused us to get a lot more bullish

at the beginning of May. We remain so today. Why is that wrong, Ellen? Look, I don't, for the reasons he listed, right, if all of those things come true, and he caveated it as well, then you are looking at a bull market that continue. I'm just much more comfortable at an entry point at 5,500

than I am at 6,000 plus. But don't you think the things that he said are likely to come true? Like you figure there's going to be, the president's gonna declare victory on the trade war at some point, and tariffs are never gonna be what they originally were when they were dialed back and started this whole move.

We're gonna get the BBB, the big beautiful bill passed. It does, the one big beautiful bill offset all of that? Is it enough to convince global investors that they can pull term premium down at the long end of the yield curve? Those are big ifs. Now I do think there are some really interesting things here. I am a big bull on AI and coming productivity from AI. I am still very, very optimistic around defense and incorporating AI and tech into defense.

And with the one big beautiful bill, what I'm most excited about are the investment incentives in it. Because I think as we roll into 2026, a narrative that I like is that the second derivative on growth, GDP growth, is not going to be driven by the consumer. It's going to be driven by the consumer, it's going to be driven by infrastructure. I think the other, and somewhat tied to that, the other big if that exists here is the labor market. If the labor market remains intact, then you don't see some of these cracks start to widen

in the second half of the year. Even this morning, relatively stable jobless claims figure, but the continuing jobless claims number made another new cycle high. That differential is just telling you that the rehiring rate is still really low. And it's not giving you any sort of Armageddon signal for the economy that you're starting to see some kind of spike in layoffs. But I think that coupled with now relatively restrictive immigration policy and the fact that we probably can't bake into any economic forecast just the assumption that you're going

to get at least some sort of stable growth in the foreign born labor population here. If that's not going to be the case moving forward, then you have downward pressure on labor force growth. And at its most basic level, the economic growth, the economy as it's growing, is a function of productivity growth and labor force growth. So you need that productivity piece to really pick up and expand a lot more. And so I think that's why, to Ellen's point, going into 26, if that infrastructure spend

and sort of productivity story is going to really expand, I think that's great and maybe plugs the gap from the labor perspective, but I think that labor becomes an ever more important part of the puzzle. What happens, Ellen, if the tariffs in the current trade situation doesn't add to inflation like the greatest fears were at the beginning of all this? Because there's really no evidence that it's going to yet.

It's, look, it's, so, well, we do have evidence. I would argue against that. And it goes more than just the surveys of businesses saying, no, I am passing it on, and your Walmarts of the world saying, I am passing it on. We are still working through an inventory glut of all that front loading and building inventories ahead of the tariffs. So I don't think we should be complacent that maybe because we haven't seen it yet, it's just not coming. But your question is a good one to ask.

What if we're wrong? How often are economists wrong? And if we're wrong, then you have sort of a 2019 scenario where we thought it was the end of the world, this trade dispute with with China and it turns out that Chinese manufacturers Just absorbed much more of the costs than expected and we weren't in the inflation problem that we were now that brings the Fed Back into the picture. Right? So what does the Fed do the Fed? I do believe is gonna cut rates Yes, there's a question is whether they get it in before the end of the year or not is going to cut rates. Yes, there's a question as to whether they get it in before the end of the year or not, but is it a Fed cutting rates to come to the rescue of a failing economy

or is it a Fed just doing moderate adjustments because we need to recalibrate policy? Well, I think the best outcome would be the latter. Of course. I mean, you know what the president obviously has been making his case pretty consistently did again today. Let's listen to the president urging Chair Powell once again, if you want to use urging, maybe it's stronger words from the president. He wants rate cuts. If we would lower the interest rates by one point,

we'd pay about one point less. That's $300 billion a year. But I'm not going to fire him. We want to get rid of inflation, and we have. But we're going to be paying more for debt. And all he has to do is lower it. Europe's done 10 lowerings. We've done none.

Here to discuss with our panel, senior economics reporter Steve Leesman. What did you make of that today, Steve? I think his math is good. I think he's right. It's kind of an interesting trade off, something I wrote about about a month ago or three weeks ago, which was this idea that if tariffs are keeping the Fed from cutting rates, then maybe the President ought to rethink the tariffs because rates could be lower.

I'm just not sure that the President has the right dynamic as to how the bond market would react. If you look, for example, the 210 spread, Scott, it's been quite a bit steeper. It's 45, 46 basis points right now. So the short end, it seems to me, is anticipating what Ellen was talking about which is a readjustment over time of say 50 basis points lower. That's why you're in the 394 percent range

but the 10-year remains above 430. It's been as high kind of running around 450. So that to me suggests that the 10-year which by the way Scott as you know when the bottom market wants to express an opinion about what the Fed ought to do it is not shy about doing so and it is not screaming so I would worry Scott at this point that if the Fed were to lower rates now you would have the concern or additional concern about inflation work its way into the 10-year I think this idea of the Fed of taking its time hey does it show up? Well, then show up in May Let's take a look at June take a look at July and then we can cut rates down the road especially because from all indications got the

Economy seems to be doing okay And it's hard to look any particular place in the economy and say oh we need rate cuts because of that No, but it's not a because of but it it's why not now. If you're going to cut in September, why not, Steve, just do it at the next meeting and then you can explain yourself at Jackson Hole as you look to the fall. Because you're still concerned. Look, I think people's conception of time is kind of interesting to me. He just put the tariffs on and took them off in April, and we're just now getting inflation data from May.

As one of your guests pointed out, there's a whole boatload, literally and figuratively, of stuff that came into the country in inventory over the course before April and May, and that stuff's being worked off. We'll see what happens when that stuff runs out, literally stuff. It's a lot of different things that are out there appliances electronics all kinds of things came into the country It's just not clear to me. What is lost. I mean and by the way The Fed doesn't cut a percentage point and the government's average cost of borrowing Declines by a percentage point. There's all kinds of tenors out there

of borrowing declines by a percentage point. There's all kinds of tenors out there, 10 and 20 and 30 that have been sold over the course of the years and the decades. It takes time to bring it down so it wouldn't be a one percentage point immediate benefit to the government. It would help over time but the market has to agree with the Fed. Now the Fed can guide the market there but as you know Scott you talk to Mr. Gunlack all the time who's in favor of the idea that the market really guides the Fed so I don't see the market right now screaming that we need a one percentage point decline in the funds rate. Ellen your reaction to that? Yeah it's always gonna feel like the market leads the Fed because the market is a high frequency

beast and the Fed makes low frequencyfrequency decisions in that high-frequency world so The market will always feel like it moves before the Fed but no the I Absolutely agree with Steve The market is not expecting nor thinks the Fed should cut one full percentage point here in short order and I think it's it's here in short order. And I think it's pretty rich to blame the debt on the Fed. The Fed is a price taker here, or that the Fed would help do the government a solid by dropping interest rates.

The debt is a congressional problem. It is not a Fed problem. I think the other thing to think about in terms of a full percentage point cut in the Fed funds rate I mean you could go back in history and just look at the times. They're cutting in that aggressive of a manner I mean, that's when they're responding to some sort of dire economic situation I think there are sectors that Definitely feel as if they need lower rates housing is certainly one of them in terms of the restrictiveness that you have for new buyers

Stepping into that market, but also a rate cut is not going to unlock more housing supply necessarily. Actually might have the opposite effect in some cases for home prices. I think that's the aspect. I wasn't asking you, by the way, to react necessarily to the full point. To me, that's not the point. The point is, should they cut now, whether it's 25, 50 or whatever, not by the amount that the president threw out there. That's almost irrelevant.

I think at this point, though, you do start to talk about not just a 25 basis point cut. You would need to, because the Fed has been on hold for a little bit longer and they've been mentioning the things that have been keeping them on hold, I think to signal a cut is to signal many cuts, or at least give some kind of path as to where they're going and how they're thinking about this.

Because to me, I wonder if you agree, Ellen. The last thing I think this Fed wants is to just do an on again off again. We'll just go meeting by meeting and maybe we'll just keep the market and everyone on their toes because we have no idea. I think that this Fed and the language that you're hearing, especially from Rafael Bostic recently, talking about how this process of making tariffs, delaying, putting them on, maybe raising them, maybe cutting them, that in and of itself could be inflationary.

So there's still a lot of hesitation that they have in setting policy. Yeah, the Fed operates under the law of inertia. So once they get going, they keep going. And the thought that one, two, or a third cut here or there is something that's going to change the course of the economic outcome, economic outlook, it just doesn't happen. They're patient, nothing's falling apart here, and they want to be sure that when they start, they can keep going. Well, let me ask you this then.

They were late getting going with their rate hikes. You don't think that changed the economic outcome by being as late as they were and then being forced to react to come back at you on what you said a little bit? No, I don't, and here's why. So why is it that we were calling for a soft landing as they were and then being forced to react to come back at you on what you said a little bit? No, I don't, and here's why. So why is it that we were calling for a soft landing

since March of 2022, even through 75 basis point increases where people thought the world was falling apart because we were very insensitive to interest rate increases. The household balance sheet is locked in at a low fixed rate. We just, so the Fed could go far and fast. What does that also mean? It means that they may have to cut more than they think in order to stimulate the economy

if the economy gets into trouble. And that's one reason why when they do finally start to cut, they're likely to keep going. But I don't think they have to be there yet. And we'll hear from Chair Powell next week on that. He doesn't, Chair Powell doesn't, Steve, want the president's criticism of being too late Powell to come to fruition.

I mean they do have to be mindful of that as well. They don't want to repeat the mistakes at the end that they did at the beginning. I don't think that Chair Powell cares two bits about President Trump's criticism I would just offer. I think the question for the Fed is one about, look, it has this one tool essentially, which is the overnight rate, and it tries to control the out here 10-year rate. So it wants to be very careful not to lose touch with that 10-year. If goes the wrong way the Fed has to bring the 10-year and the five-year To a lesser extent along with it where it goes to really influence the economy in that We don't have immediately remember Scott

It's been the markets belief in weakness in the employment side That has been the thing that has really caused probabilities of rate cuts to surge. And that's really come off quite a bit as the job market has really not shown substantial weakness, although it's just shown some softening. So I think the idea of what the Fed's responsibility here, which is to make sure it maintains a connection to the market factors that really will influence the economy Suggests that that prudence makes sense all of that said the president may end up being right here

But not for the guy right now who's running the Federal Reserve and the board itself makes it all the more interesting Steve Thank you for joining us that Steve Leesman now Let's bring in truest Keith Lerner Morgan Stanley's Ellen Zettner Schwab's Kevin Gordon of course are still with us. Good to have you join the conversation Keith I almost feel like the Bulls like Brad Gerstner are back to their playbook that they thought was gonna work at the beginning of the year. It just got delayed not denied it's counting on rate cuts we think we're gonna get some this year taxes we think we're going to get some this year. Taxes, we think we're going to get this big beautiful bill in some

form or fashion. Tariffs aren't going to be nearly what they were on April the 2nd. You're going to get M&A. You're going to get IPOs. The IPOs that have come out in the last week have been gangbusters as we said. What's wrong with that story?

Well, hey, Scott, great to be with you. I don't think much is wrong with that story. I mean, I heard to be with you. I don't think much is wrong with that story. I mean, I heard the discussion before. I think the biggest risk is that now you have some more good news priced in because of valuations. But I will also say, I think right now, earlier this year, the only focus was on

the big T of terrors. And really what we've seen now is that the former T, the technology side, the AI revolution, has come back front and center. And I think that's the biggest upside for this market. We're overweight tech, we still think there's upside. And the big picture for tech that's important is that we're only about 1% above where we were last July.

So the bullish side is that you really have been consolidating the tech sector, the biggest part of this market for about a year, and it's poised to break out. And if it does, it will bring the rest of this market up with it. But again, I think that's probably more of a narrow market again,

which may be frustrating for some, where growth outperforms and takes that baton again. And regardless of what happens with the Fed or the interest rate side, I think tech and the AI side and communication services are in a point of leadership that should likely continue. That's why you upgraded growth to attractive just today. It's one of the reasons we wanted you to come on now and talk about that.

That you're a big believer that there's been a reigniting of that trade and it's a powerful force now behind it yet again. That's right. We've been overweight communication services, which is an AI derivative, you know, all year long. Last week we upgraded technology, and if you overweight those two sectors, those are the two biggest sectors within the growth sector. So they go hand in hand, and really what stands out to me

is earlier this year, you know, we saw earnings trends for the overall market started to come down. They have inflected higher. The main driver of that is again, tech and communication services. We're not seeing that same follow through from mid caps or small caps. Now maybe we will if some of those animal spirits come back later in the year. That's part of the reason why we've seen a little bit of a catch up. But ultimately the main theme of this bull market still seems to be AI and if we are going to move higher, which I think we eventually will break out of this range, I think the growth sector, technology, communication services

will remain leadership. I mean, Ellen, these companies are essentially telling you that what Brad Gerson describes as an AI super cycle is not slowing down anytime soon. We're just returning from San Francisco, AWS spent $25 billion in a couple of days on data center, Meta $15 billion invested in something else and there's so much optimism still around where those dollars are being spent and the kind of return on investment that these companies are going to get. The income has been strong and really steady. But I think what's important here is... Can you not be bullish because of that? Yeah, well, look, Kevin, myself,

all the guests that we've heard from have said we are bullish on AI. Bullish on AI and the productivity that comes from that. But I think what's so important that we just heard from Keith was narrow. The bullishness is narrow, and it's narrow around AI and tech. So that's why I say I'm not comfortable with 6,000 as the entry point on S&P.

I'd be more comfortable with 5,500 because it's not being driven broadly. It's not being driven broadly and there's not a broad narrative. The narrative is narrow and so we're still in a stock picking universe here. We're still in a universe where, and I don't think it's a pipe dream to think that AI and AI boom is coming. We've been very bullish on AI. And you talk to these guys and it is the income, its stream is just very steady.

GDP, data centers contributed more, the full percentage point to GDP in the first quarter. In the one big beautiful bill, some of those infrastructure incentives are specifically intended for data center build outs. It's a global race for AI, and we have to be sure that the US is first. Don't argue with the partner you brought to the dance,

take them to the dance floor. I mean, if it is narrow, so be it. As long as you're in the right stocks. Well, that's the thing, I mean, just to, exactly, to emphasize the narrow point, I mean even if you just look at the Mag 7, there is a more than 40 percentage point performance spread year to date between Meta and Apple. Two stocks that are in the same group being the Mag 7, different sectors, communication services for Meta and tech for Apple, but even within a group like that, you've got

this massive dispersion. That doesn't even factor in names like Tesla and Microsoft, which have also gone opposite directions. So yes, as a group, if you wanna track it as a group and track those three sectors, communication services, consumer discretionary, and then tech, you can look at their earnings share and see that yes, it's continued to climb, even though this capex spend has been pretty massive and it has at some points

become worrisome, whether it was last summer or whether it was earlier this winter. But yeah, I think it does put more of the spotlight to your point on company by company almost, not even industry by industry, but company by company in terms of who benefits the most and who gets that highest return on that invested capital. Keith, I'll give you the last word

on where you think this market's going, new highs and perhaps beyond. Well, I do think we'll make new highs led by tech. And even though the US market is somewhat narrow, I will say globally, we are actually somewhat broad. Over 90% of stocks or countries that we follow are uptrends and the EFI, the MSCI EFI index just broke out of a multi-decade high and has trailed the S&P

by a wide margin. So I would say, look at US, look at growth in tech, but don't forget about international and there is a broader story outside the US as well that will likely continue to unfold. Appreciate everybody's time. Ellen, thank you, Kevin and Keith, we'll see you soon. Thank you. Thank you.

CHIME making its big debut today at the NASDAQ and surging Leslie Picker here with more behind that story of that big time chart that we're looking at of 35% as we speak. Yeah, Scott, quite the debut it's been today. Currently shares are trading about 36 percent higher around $36.67. This comes after Chime priced a dollar above the range at $27 per share which at that time implied a fully diluted valuation of $11.6 billion which is less than half the valuation Chime commanded back in 2021 in a private funding round. Still, of course, the stock

doing quite well today. Chime is a fintech company that provides banking services that target individuals making $100,000 a year or below. Rather than traditional banks, which rely on a net interest margin model making profit from loan making, Chime generates a substantial majority of revenue through interchange fees. Those are paid by card networks whenever its debit and credit cards are used. CHIME actually swung to a net profit in Q1 as revenue jumped 32% year over year. However, credit quality always a key question with transaction and risk losses totaling 21% of

revenue in the first three months of the year. Chime is listed on the NASDAQ under the symbol C-H-Y-M. Scott. We'll see where it closes. Leslie, thank you. Leslie Picker. We're just getting started here on Closing Bell Up Next. Goldman, Sarah Nates, Terahano breaking out her playbook for stocks.

And later, a can't miss interview with JP Morgan's Jabrata Kolekos. We'll find out whether he is now more bullish as we head into the summer. We're live at the New York Stock Exchange. You're watching Closing Bell on CNBC. Welcome back as we take a look at stocks here. And the green trying to add a little bit as we edge towards the close. We're still less than 2% from a new high.

Joining me now Sarah Nason-Terrejano, head of private wealth management at Goldman Sachs with a very big focus on family office. Welcome back. Thanks for having me. So you just had a big meeting. 200 institutional family offices from around the world, 17 countries and 80 cities. So you got a great cross-section view

of what the world thinks about stocks. Is it easier to make the bullish case today or harder, given where the market's gone to and where valuations are? Look, we had a lot of family offices there and one thing I'll say, across the board was a greater interest in public markets, and I think that's not surprising, given the dislocation we saw on April 2nd.

And so clients are very engaged in public markets. I think you can continue to make a bull case for equities, and I'm still quite bullish, particularly U.S. equities. What I'll say about that though is with vol really coming back in and you know the VIX hit 16 this week, people are also looking at hedging strategies which you know I think is logical given some of the political uncertainty, the policy uncertainty, but I think there's still a case for for bullish U.S. equities. I mean we talked about the broadening last time I was here

and we definitely have seen some outperformance from the 493. They're up close to 5% year to date versus the Mag-7 of just about 2%. And Mag-7 posted a really fantastic first quarter and given we're at the sort of the tip of the iceberg on AI innovation, I'm still bullish these stocks. I mean, there are some who,

we've just talked to one who thinks you're gonna get a reverse into the small. Again, the small group is just gonna lead the way because they proved it. The AI super cycle and the earnings that you just cited yourself are gonna be reasons why everybody just goes back and continues to ride those stocks.

Yeah, I would not bet against the Mag-7 right now. I think 28% earnings growth versus the rest of the market at 8%, and then keeping in mind, you've got mutual funds underweight by about 7%. That's an interesting tailwind as well. And then, being, and I heard others on your show talking about this, really kind of the first stage of what is an AI revolution.

I don't know if it means you need to pick one or the other. I think you can be along the index and then think about adding exposure accordingly to these stocks. What about the ideas Brad Gerstler told me on Halftime about the big bullish case, these are my words, not his, but being delayed, not denied. Is what you came into the year thinking was gonna happen

is still gonna happen. It just got pushed because the tariffs were a lot steeper than people expected that they would be maybe the battle over the big beautiful bill is going to be a little messier than the people thought but but it's all going to happen the tariffs aren't going to nearly be what they were on the big board on April 2nd and you're going to get M&A you're going to get IPOs you got the super cycle you said earning earning surprise to the upside, valuation you can make an argument is justified as a result of that. So it was just delayed, it wasn't denied and we're about to realize all that.

Yeah, I don't disagree. I mean, I think you see capital markets activity. We've had 10 IPOs in the last month and they're trading fantastic. So you've got positive capital markets activity, a resilient equity market, fantastic earnings at the end of the day. You know, earnings are really what drive growth in valuation here.

And I think, you know, the negative case would be a surprise around effective tariff rates, right? If we end up with higher effective tariff rates than anticipated, you know, that's obviously a potential negative supplies, geopolitical risk, but barring any of those, I think he's right. We might get some blips.

I think it's more about owning these stocks for the longterm, which is how most of our clients think. They wanna be long these stocks for years, for cycles. VIX, you mentioned it, 16, it's at 17. Ooh, like, well, my gosh, the VIX is like so high. You think people are too complacent about the risks that are still out there. Like you said, what if effective tariff rates are higher?

What if the labor market starts to unravel? And what if inflation remains high because of the tariffs? What do you think about that? Too complacent. Listen, I don't think most of our clients are that complacent. I think they're aware of the risks. They understand CPI came in softer than expected. They think there our clients are that complacent. I think they're aware of the risks. They understand, you know,

CPI came in softer than expected. They think there's a possibility that looks different, you know, in the back when tariffs are put into place. And so they're aware of these risks, but I think it doesn't change their desire to generally be risk on, to know that being long equities over cycles tends to outperform inflation.

It's very hard to time it to come out and come back in. So for those who are anxious, that's where we say think about hedges, right? I mean there's a way to deal with that without you know taking a tax gain and changing the nature of your portfolio. So I don't think clients are complacent and I think they're just kind of riding through this and we'll observe what happens and act accordingly. Lastly and quickly, dollar weakness. Yeah. Is that concerning in any way? It's bullish, some would say, for multinationals, obviously.

Well, I think, first of all, it's putting in perspective that we're coming off incredible dollar strength for the last three years plus, and so some of it is a little bit to be expected, and you'd sort of expect some pressure on the US dollar with concerns around tariffs and the deficit. And then today, I think we saw some pressure on the US dollar given the softer CPI than expected.

The two-year came in a bit. That's kind of what you would expect. I don't think people are saying, does this mean people aren't investing in the US? I don't think so. I think it means that maybe some foreign participants are hedging their exposure, which I think is logical, right, to hedge that currency exposure. So I'm not particularly concerned about the U.S. dollar.

All right. We'll talk to you again soon. See what transpires in these markets. Sarah, thanks. Thanks so much for having me. Sarah Nason-Terahano, Goldman Sachs up next. JP Morgan's Gibranco Lecos is standing by with his own forecast for stocks. He'll tell you what he thinks and where we're going.

He'll do it next. Welcome back to Closing Bell. Our next guest just raised his S&P target after cutting it just a couple of months ago. It shows how much sentiment has shifted with stocks edging towards new highs. Dubrovko Lakos, JP Morgan's head of global market strategy joins us now. It's good to see you, welcome back. Thank you Scott. You did raise your target but it's the 6,000. We're already there. So you think the next six months are going to bring us what? Well look, if you looked at the details of our last two, three reports, we've actually

been pushing the bullish tactical trade since the end of April. And you know, the 6,000 year end price target for us is really more a view that the market from here on is likely going to be range bound. You know, if I had to sort of cut that up, I would probably say that in the very, very short term, the upside trade or the upside squeeze likely continues to persist. But then I think you have to start worrying

about the fact that tariff volatility could pick up as you go into July. And I think there is a risk that future payroll numbers take a hit, given some of the sort of changes that have happened on the policy side earlier this year. And so that could then induce another growth scare. And then after that, we need to see how the basically the Fed responds, which I think, you know,

we could see a situation where the Fed perhaps also goes a bit sooner than expected. And then that basically sets us up for again, a more bullish backdrop in the backend of the year. So range bound broadly, with maybe still some further room for upside in the very, very short term. So the bulls, I don't want to paint you as a bear because you're not, but the bulls who say you really need to lean in here make the case of look at what just happened with the

mega caps and earnings. They justified all of the belief in this super cycle. Look at what's happening on the Hill with the mega caps and earnings. They justified all of the belief in the super cycle. Look at what's happening on the hill with the administration. They don't want the story to unravel. They say, well, we know what the president's going to do at the end of the day on the tariffs. That's bullish because he's not going to put his foot all the way to the floor because they learned their lesson one time already. The taxes are going to get done.

You're finally going to get M&A. And have you seen what's happening with the IPO market? It's going crazy. The ones that have listed in the last week or so. Now the sample size is obviously small, but that would just tell you there's a lot of pent up demand that's going to come to this market. And then, oh, by the way, the Fed's going to cut also. If there's even a sniff of labor market unravel, they're gonna come to the rescue too. So it's hard to be bearish in that environment. I would not be bearish, but I do think there will be various pockets of volatility that we'll have to digest in the coming period.

And thus, I would probably be then looking for that weakness to then reload back into the market Given that we've had already such a strong strong run. So our conviction level at the market right now here I wouldn't say is that high where I would be actually placing the conviction is really more in the long short momentum trade Which we have also been sort of pushing quite heavily and that is basically staying along the broader AI complex, the big tech complex, data center complex, that's the area that we think continues to outperform on a relative basis. That's the thing, like if that does outperform, then that theoretically takes the S&P 500

into uncharted territory, correct? So that's reason enough, if you're in the right stocks and leaning in in the right area to think that 6,000 looks light on the S&P if that trade continues to work, even if some other areas don't. I agree with that, but again, as I mentioned earlier, I think we need to be very open to the fact

that we could take a payroll hit at some point in the coming months. And so let's say if early July you get a negative NFP, I do think that the market could go through a short-term growth scare and you could have a relatively easy sort of flush unwind. And then I would most likely look to lean against that and make another sort of upside case for the market. And you don't think we already had that, right?

Cause I feel like we already went through one of these growth scares already. And then we realized, wow, you know what? The economy is more resilient than we thought again. The consumer is more resilient than we thought again. And earnings turned out to be way better than we thought they'd be again. Yes, we did.

We did have a pretty, I would say, big shock that we basically faced. I don't think we're going to face anything similar in terms of magnitude, but nonetheless, given that things have sort of run up and have the potential to keep running up in the course of next week or two, I do think you probably want to sort of take a slightly more conservative view as you go into July, and then look to sort of replay the bullish thesis a bit later on. So that's why I would sort of make a little bit more of this like range bound call around the 6,000 level.

Looks to me like you're back at HQ or one of the offices on the trading floor, but you were at the quantitative conference that JP Morgan was having, which was all about AI, right? So this was right front and center for you in terms of where the action remains. I mean no, this completely reinforces the theme for us. Yes, we're literally in the midst of our JPMorgan research, quant AI conference. AI LLM is really at the center in terms of the topic.

A huge interest, record attendance, and you and this is an area that I think remains very exciting, and we're gonna continue to see a lot of new developments and sort of applications, even for the world of investing, over the coming quarters, and so it's something that we continue to focus on quite heavily, both within research as well as JPMorgan more broadly. Dubravko, we'll see you soon. I appreciate your time as always.

Always enjoy the conversation. Thank you. Dubravko Lekos, JPM.. I appreciate your time as always. Always enjoy the conversation. Thank you. Dabraco Lakers, JPM. Up next, track the biggest movers into the close today. Christina Parts-Navarro joins us with that. Hi, Christina. Hi, Scott. Well, we have a tech giant that hit record highs today after promising softer growth

and a meme stock taking a hit on new debt plans. All of those details are after this short break. Less than 15 from the closing bell. Back to Christina now for the stocks that she's watching. Tell us what you see. Let's start with Oracle because it's touching all or did touch all time highs earlier today. The S&P leader really impressed investors with its guidance on cloud growth. By the way, that all time high was 202.

So not that far off. What we're saying is that the CEO, Safra Katz, said the company expects its cloud infrastructure revenue growth rate to continue to accelerate to 70% in fiscal 2026, and that's from 50% just this past year. Also guiding for stronger revenues that analysts expected in fiscal 2026. Really it has to do with the backlog should be increasing about 100% which is a pretty bold statement coming from the company meantime let's move on to GameStock it's not the same story at all with this stock price falling today after announcing a 1.75 billion

dollar convertible note offering which is really just a short-term bond that eventually would convert into stock later GameStock intends to use the proceeds for the offerings for quote general corporate purposes including investments that's the key the investments because the company's investment policy as of late has been to buy up a lot of Bitcoin most recently in May it bought about 5,000 Bitcoins you can see the market doesn't really like this idea of a proxy shares down about 23% Bitcoin props proxy I should say Scott all right good flag for us for us. Thank you, Christina Partzanovalos. Still ahead, Adobe reporting top of the hour. We'll set you up for those numbers coming up. The bell will be right back.

We're now the Closing Bell Market Zone. Christina Part-Ovalos with us today, watching AMD's Advanced AI Event. Pippa Stevens looking at Adobe reports in OT. Tonight, I'm with Keele Live for the Coinbase's Crypto Summit. Christina, we begin with you and this AMD event, which has been going on this afternoon. Yeah, AMD really throwing down the gauntlet against NVIDIA with its new Instinct MI-400 AI chip

set to ship next year. The big play though is that these chips can stack into a massive server or massive server racks I should say called Helios. Think of like hundreds of processors working as a giant brain. AI companies need exactly this type of hyper scale set up to train their large language models. AMD's betting it can undercut Nvidia on both price and power consumption with executives promising quote aggressive pricing and chips that simply cost less to run.

The company claims its new hardware beats Nvidia's offerings for AI inference, which is the part where trained models actually answer questions and generate responses. But you can see AMD stock hasn't really gone, I would say anywhere this year down 26 in the last year, 2% today after this big AI event, suggesting investors really aren't convinced that this David can take on Goliath of AI chips with cloud providers, though, and AI companies burning through billions on computing power. AMD's timing really couldn't be better.

The question is whether customers are going to be willing to risk switching from Nvidia's proven ecosystem for potential savings. AMD's CEO, Lisa Su, will join our John Fort in just a few minutes for an exclusive interview to discuss these latest announcements. All right, good stuff. Christina, thank you very much for that. Tepipa Stevens on Adobe, which wants a little piece

of the AI pie as well, earnings and OT. That's right, Scott. So Adobe earnings are on deck as the AI competition heats up with Adobe underperforming peers so far this year. Now the company did recently announce a price hike for Creative Cloud due to added AI features, which is set to go into effect later this month, with analysts noting that FX should also be a tailwind

relative to when guidance was provided. Now this will be the second quarter where the company reports revenue for its two newly introduced segments with Evercore ISI saying it's still hard to determine what's good enough for each segment. That said, the firm said maintaining mid-teens growth in the business professionals and consumer segment would be helpful in fending off the bare narrative around Canva and the extent to which it's seeding market share.

Now, Jason Morgan adding, the stock represents an attractive valuation. Scott? All right. Pippa, thank you. Pippa Stevens. Emily Wilkins has some news out of Washington, D.C. for us. Emily, what do we know? Hey, Scott.

Well, we were watching that rescissions package and it's now passed the House. This is the one to really formalize those Doge cuts to USAID as well as cuts to PBS, NPR, other public communications. But a real nail biter of a vote here in the House. It looked at one point like it was going to fail. You had as many as eight Republicans voting against, but then leadership managed to convince some of those to go ahead and vote to support this package and support it going through. It now heads on to the Senate. And Scott, this is of course

a really big test for the White House's ability to cancel some of that funding as well as a test for fiscal hawks to really be able to get their way in cutting some of the government spending this entire package, $9.4 billion just to drop in the bucket when you consider the $1.6 trillion that the government spends. But it is a start and expect more packages to come. All right, Emily Wilkins, thanks for the update there. To Taneya McKeel on Coinbase, what's happening? Yeah, it's got hundreds of people in finance, tech, and policy all here at the third annual Coinbase State of Crypto Summit. All the big names you can think of represented BlackRock, Shopify, Co2, some of the heavy hitters that are on stage. Now, in the past got this conference was all about the future of crypto and what the industry might accomplish with a more crypto friendly Washington.

But this year it's all about what's happening now, the conversations that are taking place now and the products that are launching several products from Coinbase today, which I think might be at the start of a big boom in product marketing this year. Yeah, Michelle, thank you very much. We'll go out green. Dow looks to get about 100 points. We'll see how it settles in the overtime with Morgan & Giles.