Closing Bell - Closing Bell 7/16/25

Episode Date: July 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.

Welcome to Closing Bell. I'm Sarah Eisen. And today for Scott Wapner, this Make or Break Hour begins with the walk back. Stocks rebounding as President Trump says he is not planning to fire Fed Chair Jerome Powell. This comes just hours after the president reportedly told a room full of Republican lawmakers that he was getting ready to can the Fed chief. Our team of reporters is standing by with the latest. Also front and center this hour, the banks. Earnings rolling in from Goldman Sachs, Bank of America, Morgan Stanley.

I spoke with Goldman's CEO earlier today. His take on the banking sector coming up. And later we are getting you ready for United Airlines earnings after the bell. What to watch for when those numbers hit the tape. But first we start off with those latest developments out of Washington. The fate of the Fed share. High drama today. Megan Casella in our DC newsroom with the latest. Megan.

Absolutely, Sarah. It was a jam-packed few hours here. Some market whipsawing after the president sought to make it clear he's not currently planning to fire the Fed chair. Take a listen to how he put it in the Oval Office earlier today. Completely ruling out the idea of firing Jerome Powell.

I don't rule out anything, but I think it's highly unlikely, unless he has to leave for fraud. I mean, it's possible there's fraud involved with the $2.5, $2.7 billion renovation. So he's not completely ruling it out, and he's raising the possibility there of fraud being a probable cause for the firing. But those comments coming just shortly after a senior White House official told me that the president had indicated he was likely to fire Powell and potentially sometime soon.

The official told me he had suggested he likely would after discussing the idea yesterday with Republican lawmakers. So we'll see where things go from here, Sarah. But the biggest questions at this point, of course, are whether Trump will do this. But secondly, whether he legally can. And remember, Powell has been consistent this year that he plans to finish out his term and that he thinks his firing, in his words, is not permitted under the law. So a question now for senators as well as for the judicial system.

Sarah? I think there are a lot of questions for senators, including the fact that this has been going on for seven years now. They're seven years into a nine-year renovation. It has never come up at any hearing. He testifies twice a year, and everything's been out in the open, including the budget for this project.

It's also been approved by the board, which is made up of members that have been confirmed by the Senate. I mean, it would be tough if they were gonna use this politically to prove fraud if it's just coming up now. Absolutely, it's be tough if they were going to use this politically to prove fraud. It's just coming up now. Absolutely. It's just coming up now.

And the Fed is really trying to be as transparent as possible on this. We saw reports that Powell is asking an independent inspector general to start looking into this, to try to clear himself or at least separate himself from everything that's going on. So a lot of questions for senators, you're right. And reports coming out of Capitol Hill is that even Senate Republicans are not willing at this point to go along with this. They say some key senators at least have been saying that they do not believe that the president would have the authority to do this. So one question on the project and a second one on the legal authority of if he can even move forward. Right. And maybe that's why ultimately

today he said he's not planning to do anything. Megan, thank you. Megan Casella, let's bring in former deputy treasury secretary, Evercore founder and senior chairman Roger Altman. What do you make of all this, Roger? Hi, Sarah. How are you? I'm good. I mean, my head's spinning a little bit, but I think it's a big breath. I think a big breath of sigh of relief was felt here

when President Trump said, I'm not planning to do that, I'm not doing that. You know, whether President Trump really intended to do it in the first place seems to me dubious. But stepping back, there are a lot of really bad ideas out there. But the President firing the chairman of the Fed, or I should say trying to fire him,

because that's not clear to me at all that he could succeed. That's among the worst ideas. And I think it's no surprise to hear you say that a lot of Senate Republicans don't think it's a good idea or don't think he has the authority to do it because it's a dreadful idea. And President Trump would severely regret that if he ever carried it off.

Why? Can you just spell out what it would look like? It's a dreadful idea because people know, in markets at least, that if you simply compare over years and years, major countries that have independent central banks and what their economic performances have been versus major companies that have politicized central banks controlled, for example, by their heads of state. The difference is stark.

It's stark. Once you eliminate the independence of your central bank and make the head of the central bank a colleague, so to speak, of the president or the head of state, you're headed down. And history is very clear on that. And people in markets know that. Yeah, you can look at Bank of England as an example for sort of pre and post-independence and looking at the inflation record.

You can look at Turkey, you can look at Argentina, a lot of, there are a lot of examples and there's been a lot written on this. And by the way, I want to come back to something. I don't think Chairman Powell would exceed to a request that he leave, so I think ultimately this would be to a request that he leave. So I think ultimately this would be resolved in the courts. And if the only basis for firing him in terms of the statute is cause quote unquote, and the purported cause would have to be the cost overrides on the renovation, that's a very, very thin read.

Proving that Chairman Powell was complicit in creating or proving the overruns or words to that effect, I don't see it. No, I agree. So I think it would be a failed effort to oust him. And I think President Trump is too smart to go down that road. He probably likes trolling Chairman Powell, but I don't think he intends to really do this as he came back and said this afternoon. I agree. It sounds right to me.

Also wouldn't be a very effective way to get interest rates down a few hundred basis points because you still have a committee that has to vote even if you can put a new chair in there. Roger... so you're saying... Well, and imagine the views of the other members of the committee, the federal open market committee. If the president replaced Paul with someone who obviously is there only to do what President Trump wants, those views would be pretty skeptical.

And the ability of the new appointee as chair to work his will in terms of a sharp lowering of interest rates, it seems to me would be very limited to perhaps non-existent. Roger, stay with us because I do want to bring in CNBC Senior Economics reporter Steve Leesman, who covers the Fed. Steve, I mean, the Fed's been pretty transparent on this whole building renovation. I'm curious that they're saying anything publicly today about you know, some of the political backlash and lately No, and most of the people I talked to Sarah sort of tick up Roger's idea Which is that what's going on with this building is simply pretext and the president has already made clear why he really wants to fire The Fed chair and that's because he wants interest rates lower and that's because he wants to save the US government money on paying

Interest and you made a great point, which is that it's not even clear that the Fed cutting rates would actually bring down long-term rates That's the first thing September was a bit of an eye-opener in terms of what happened there term rates. That's the first thing. September was a bit of an eye opener in terms of what happened there. The other aspect here is that it would probably be illegal for the Federal Reserve to lower interest rates in order to accommodate a lower interest cost for the federal government. The Fed has a dual mandate, as you know, Sarah, which is it can raise or lower interest rates because of unemployment or because of inflation or some combination of the two, but not in order to accommodate lower interest costs. And I'd make one other point, which is that the reason for the Fed's independence is exactly

the reason why Trump wants to lower interest rates. He wants to do so for reasons that have nothing to do with the fed's mandate of employment and inflation. He wants to do it for a completely different reason. And that's why we separate these two things. And that's why the bond market goes to sleep at night knowing that interest rates will not be lowered only for two possible only be lowered for two possible reasons, inflation and unemployment.

Well, and that's what's so crazy about this whole thing, Roger, which is I think that there is a valid debate to be had right now about whether the Fed should be lowering interest rates. And guess what? There are folks inside the Fed that feel that that's a valid debate. Governor Waller has said that he thinks that they should be cutting rates in July. So is Governor Bowman. That's a legitimate argument right now where we continue to get these inflation reports

that on the headline numbers look benign. We got PPI today. Of course that's a legitimate debate, but the debate within the Fed is something like whether we should cut in July 25 basis points or cut in September, whether we should have two cuts this year of 25 basis points each or maybe three.

Apparently, President Trump, this is just press reports, would like to see the Fed overnight lower the federal funds rate by 300 basis points. That is not a legitimate debate. Right. But don't you think he's just saying that because he likes to throw out big numbers, sort of exaggerate? It's kind of like the tariffs, right? We started out much higher and now we're not as high

and it's not looking as bad. Well, some tariffs are not as high and so forth and some are pretty high. But you're right, he's probably saying that for effect rather than really in any sense expecting it. But listen, trifling with the Fed this way is a slippery slope, to put it charitably. And it's just not a good idea.

It was interesting, Steve, when the news first broke, we were on air, it was during Money Movers, and we were watching the market reaction. And this is before President Trump in the Oval Office said, I'm not going to do that. So it was when the reports were hitting from the New York Times around that, that there was a draft letter to Fire Powell

that he intends to do so. And yes, we saw a market reaction, but it wasn't that dramatic. Stocks sold off. We saw bonds rally, the two-year rallied, and then the 10-year and the 30-year sold off. But again, not extreme. Dollar sold off a little bit.

And we were talking to David Zervos of Jeffries, and he said, yeah, it's because the alternatives of who President Trump might appoint, the market's okay with. And he mentioned Kevin Hassett, Kevin Warsh, and some of the other contenders that we hear about. I thought that was interesting. I think it is interesting, but I wouldn't focus so much on the short-term market reaction. There is the taco trade, the idea

that Trump always chickens out. So people are a little bit reluctant to go but with both feet in on a trade like this. But really what we're talking about here, Sarah, and I think you appreciate this, is this is the whole ball of wax. Either the Fed is independent or it's not. And you can get a short-term trade one way or the other

based upon who's Trump is gonna fire and who's gonna replace him. The real issue is the long-term issue of what about the bond market, how bond markets will trade with the idea that the Fed is gonna be focused on inflation, on unemployment, and not the whims of the president, and also the dollar and the dollar standing in the world.

So this is something that you might get a short-term trade. Either way, it could be big, it could be small, it could be nothing, but over time is when, if the Fed's independence is truly at risk and truly undermined, you would see a long-term erosion of the dollar. You've seen some of that already, but you much more see a long- erosion of the dollar. You've seen some of that already, but you

much more see a long term rise in interest rates because the bond market could not go to bed at night knowing that it was protected on the inflation side. The bottom line, Roger, is that he said he's not going to do it. So now do we breathe easy about this? I mean, if this comes up in conversations around confidence in U.S. assets with your foreign or domestic investors, what do you tell them? this? I mean, if this comes up in conversations around confidence in U.S. assets with your foreign or domestic investors, what do you tell them? Well, Sarah, before that, I don't agree with the person you referred to who said that the market would be just fine or comfortable with whomever the president might choose in the regular course to succeed Powell in mid-26. I don't agree with that because I think there's a

serious risk that the president will choose someone for the sole reason that that person will do the president's bidding. And I think some of the people that are often referred to as possible candidates include one or two figures like that. So I don't agree with that observation. But I mean, I guess, although they're all reputable economists and there's a committee. I mean, I guess the chair, the chair matters, but who, who are you worried, who are you worried about among some of the contenders now that we know from Treasury Secretary Besant, the process has begun.

Ask yourself, what is the number one criterion that you think President Trump will use in choosing a new chair of the Fed? Someone who will lower interest rates. Well, I would use the word subservience. So, your earlier reference to an observation that the market's perfectly comfortable thinking that trouble appoint someone who it cannot is independence

and i just don't agree with that i don't know he did a point and share powell first time around that's true i'm not sure that he's a uh... exhibited a lot of uh... the role of that and yet now right now he's gone after munition for it well for now markets okay uh... I'm not going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that.

I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that.

I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that.

I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. I'm going to go into that. much for weighing in. Let's bring in RBC Capital Markets Head of US Equity Strategy, Laurie Calvicina. On the market, pricing and all this, are they underpricing a risk or is it just okay that he continues to job own the Fed like this? Well look, you know, every time something along these lines comes up on this topic, I go to my rate strategist and say, what do you think, what are you hearing from bond investors? And he comes back to me with the comment that you made, which is that this is a committee, this is not a unilateral sort of decision maker at the Fed,

and he kind of tries to emphasize that message. I do think at the same time, you all just had a very interesting point about risk assets. International investors don't like this kind of chatter, and they are not the biggest owners of U.S. equities, but they're important owners of U.S. equities, and they've been moving in a very concerted way. If you look at funds flow data in recent years, and what we know about them is that they've kind of come into

the second half of the year skittish. We've heard a lot of concern from those investors recently about valuation levels in the US. I don't necessarily hear that from US based stock pickers. But you know, we look at this market that has run, is pricing in so much good news, desperately wants to get past tariffs, thinks 2026 is gonna be a great year and wants to focus on that. And we're kinda getting sucked back into this. So I don't think that's necessarily a good thing to do,

even if it doesn't end up being horrific, just given where we are at this point. So do you think the market is fully valued here? It depends on which model you're looking at. My valuation and earnings work, we've blown past fully valued, right which model you're looking at. My valuation and earnings work, we've blown past fully valued, right? If you're looking on 2025, we might have a little bit more room to go

on a rosy 2026 scenario, but I'll tell you, Sarah, my favorite stat is if you look at the move that we've had in three months time off of the April 8th lows, it equates to what we typically do in a nine month rebound off of growth scare type lows. 30% on the SMP. Right, about, yeah, I think we got about 26% when we looked at the recent high.

And you know, if you go back to 2010, 2011, 2018, where we are now, those kinds of drawdowns, this is where we should be at the end of the year, not right now. And if you look at all those draw, look at all those rebounds, just, you know, take the percentage off the table, they do tend to experience some periods of chop after an initial run-up. So it does feel to me like we're kind of entering into a digestion period now. We're not as sort of under-owned, we're not as kind of seeing deeply depressed sentiment

the way we did three months ago, and we're starting to get vulnerable to bad news again, maybe not on tariffs, but on other issues. But I think that the rebound in hindsight makes sense in that there was so much fear that those really high tariff rates would lead to, and we saw a spike in uncertainty, but they would lead to layoffs and massive inflation and flight out of U.S. assets, and none of that has happened.

Yeah, if you look at the CPI data yesterday, our economists think that you are starting to see signs of inflation pressure emerging, not in the overall number, but in certain components. Yeah. And we've been, we're kicking off on earnings season. I'll tell you, this morning I was really excited to read financials earnings and I got completely distracted by this. But those were good too.

And, you know, resilient consumer, M&A starting to come back. I mean, those all point to signs of growth in second half of next year. I think the financials are managing through very, very carefully. We actually spent some time last week reading through all of the earnings call transcripts across the Russell 3000 from June 25th forward. So kind of getting some of those off-cycle reporters

and seeing what they're saying. There's a lot of SMID companies in there. They may not be able to execute and manage around as well. But I'll tell you, Sarah, going through that exercise, I did not come out of it thinking, it's time to put tariffs behind us. I came out of it thinking that some companies are gonna manage through well, others are not.

We're gonna see adverse reactions in the latter camp. And there's already a lot of optimism baked in to the ones that have been managing well and sending through good messages. So I think it's gonna be very, very messy. But I do think you are starting to see whether you're looking at that CPI data yesterday or some of these earnings reports I read the last few weeks, the gears of price pressures are starting to turn. Right, but at the same time, we're getting a little price relief on services and on shelter,

which are almost bigger deals and bigger weights in the overall inflation numbers. Right, and I think a really interesting debate that could maybe put some downward pressure later on, we're just going to have to see how it plays out, but there hasn't really been a robust discussion of demand impacts yet as some of those price increases come through. I think there's also a lot of opacity around pre-buying. Some companies are saying they've seen it, others are adamant that they haven't, and some are being frank and saying, you know, we don't really know if we would be able to tell.

And I think we're gonna have a really interesting discovery process here in this next few weeks as to what exactly happened on that demand side. Of all the sectors heading into earnings now, which one looks most mispriced to you? So we actually just upgraded materials about a week, week and a half ago. And it's not that it was super cheap,

but we compare it to the industrial sector, which everybody loves and is all excited about reshoring, week and a half ago. And it's not that it was super cheap, but we compare it to the industrial sector, which everybody loves and is all excited about reshoring. And it's like close to like two and a half standard deviations on my valuation models if I go back to the 80s. And, you know, we agree the fundamentals there are nice, but you're paying a lot for that. And it feels like the material space should benefit from a lot of those same drivers. You've got very reasonable valuations, earnings revisions that have been negative or shifting

positive. We did a survey of our analysts recently on their second half outlooks, and our materials team across the board was extremely bullish over the next six to 12 months. So we think that's one, it's not that it's completely washed out on valuation, but it's got a lot going for it,

and it hasn't been bid up the same way some of these other sectors have. I'm just looking up 6% as a sector this year, which is kind of on par with the S&P. Not as good as tech and financials and utilities. And I think you kind of have to pick through, laggards is probably not quite the right word, but you know, because some of these areas

have lagged big time for a reason. Like healthcare, would you buy healthcare? That's a lager. Healthcare, we're neutral on healthcare, and I'll tell you, when we go through our analyst work, and again, we kind of put these questions out to all the analysts healthcare has one of the worst policy Assessments, you know in terms of potential disruption to the sector It's also not looking super cheap to us earnings revisions are fine

But I think they're kind of big existential issues that investors are grappling with there. Well Laurie. We had a lot talk about today It's really good to see you. Thank you for being here. Good to see you too. Laurie Calvicina. We are just getting started. Up next, two banks, two different earnings stories here with the CEOs of both Goldman Sachs and Bank of America had to say about their reports. We are live from the New York Stock Exchange. You're watching Closing Bell on CNBC. Welcome back. Let's get a check on the banks today. Morgan Stanley, Bank of America and Goldman Sachs all reporting results this morning. We spoke earlier with Goldman Sachs CEO David Solomon after beating on both the top and

bottom lines. The company reporting record equity trading revenues coming in at $840 million. I asked Solomon whether that kind of revenue, since it was caused by all the tariff volatility, was sustainable. The equity trading business is driven by broad activity. And the broad activity feels sustainable as market grows, market cap grows, economy grows.

Our financing business is super important to our equity business. We have a leading equity financing shop and that plays a big role in the overall equity beat. And so, clients were active. I wouldn't say that we'll see the volatility we saw in the early part of the quarter in the next part of the quarter.

It was very upbeat as well about the overall M&A environment, both what we're seeing now and what is to come. Listen. I think one of the structural things that's changed is CEOs believe we're at a moment in time when you can do big strategic consolidation, that it actually can get through the regulatory process. And so they've gotten much more engaged in those dialogues. And we're seeing that. And so I expect a pretty robust M&A environment the second half of the year. We also heard from Bank of America today, Leslie Picker spoke with CEO Brian Moynihan and joins us now with more Leslie.

What were your takeaways? Hey, Sarah, I mean, look, you look at these earnings and net interest income is on an upswing thanks to an average loans up 7% Extremely stable credit quality and I was just curious whether Moynihan believes there was a case to be made to lower interest rates right now Especially when the financial conditions seem so supportive Moynihan said there's a case to be made to leave rates where they are for the time being before quote They start bringing rates down the second half of next year fairly aggressively.

He said there are pockets of the economy that are more impacted by these rate levels than others. I think the reality is that the bite on the economy is a lot in a small, medium-sized business area. And the reason why that happens is they borrow on their floating rate lines of credit, and that rate went up substantially. And it's come down a bit, but it's up substantially. And that slows down economic activity.

And you couple that with our commercial clients trying to figure out what's going on in the world around them, which is tricky to figure out for a $100 million business. They're a little bit reluctant right now. They will come along as soon as clarity comes, tax bill first, trade policy second. Obviously, immigration's important to them. Moynihan said the consumer, on the other hand, is still spending and still has plenty of money

in their accounts, Sarah. Overall, Leslie, a pretty, I don't know, strong read on consumer economy, capital markets, environment. I mean, what David was saying, he also said IPOs are really starting to pick up, mentioned a few key ones that had good performance. Pretty upbeat outlook.

I know the banks have run up into earnings, but no big negative surprises, are there? No, I was joking because on several earnings calls, the executives use the phrase, we are firing on all cylinders, which I think is emblematic of what you just laid out, is that you've got this very constructive backdrop as it pertains to at least what appears to be an upswing in capital markets activity, a long awaited upswing.

We've been talking about this for essentially years now. The early part of the quarter was great for trading given the volatility that we've seen. The rate environment is pretty constructive for these banks as well. And one of the questions I also asked Brian Moynihan was essentially, you know, you held your guide steady, but you've got all of this loan growth and rates seem to be kind of higher for longer, at least for the time being. So you know, is this essentially peak backdrop? He says, I think things could get better from here.

This isn't the peak. So it remains to be seen, but it certainly was a quarter that was, you know, very, very solid for the banks overall, despite the premium heading into it. And one more plus, which is they are starting to talk about what deregulation or less onerous regulation as they're saying from the prior administration. Now that these regulators in place and some of the policies are being floated, they're able to talk more specifically about what that means, what that looks like, and why they're jazzed about it.

What did you learn? Yeah, so it was interesting. In prior quarters, macro really, you know, was the bulk of all of these earnings conference calls. Everybody wanted to know kind of how the uncertainty, how the policy uncertainty, the macro backdrop, inflation, and so forth was impacting these companies. Now all of the big six, the basis of the conversation was essentially, you know, now that we're

looking at a looser capital environment most likely, what do you plan to do? How do you plan to deploy that capital? Is it in the form of additional buybacks? Is it acquisitions? A lot of questions about inorganic growth opportunities. And most banks were saying, you know, we want to use that capital to invest in our current businesses, but they were definitely pressed by the analysts on, okay, but if you had your dream job, your dream idea for a deal, like what would that look like? And so there was a lot of discussion and debate around that

as well. Which is a sign of the times because they never would have been asked that question in the last few years because they wouldn't have been allowed to do it. Exactly. Leslie, thank you. Leslie Picker. Coming up, Rockefeller Cheryl Young is back. Big tech earnings on deck.

Hear how she's playing this space. Closing bell back after a quick break. Less than half hour of trading. for another record close as we gear up for tech earnings. My next guest is bullish on the sector. Joining me now is Rockefeller Global Family Office's Cheryl Young. Cheryl, it's good to have you. So we do start to get tech earnings. Google's next week. The stocks have run up into the reports. How do you like the setup? Well, when you see the stocks have run up into the reports, Sarah, not all of them have.

Most of the Mag-7 is actually still negative here to date. When you look at the broad sector, it's positive. Technology is up about 10%, but the participation's actually broadened this year, which is really exciting to see. The Mag-7 has lagged, and most of the returns from the MAG-7 year to date have come from one stock, which we all can know and love, NVIDIA, which is really

about a third of the S&P's earnings year to date as well. So you see some catch up from some of the other big tech players? I hope so. I want to see the broadening. That's a healthy market. Sarah, if we look at the last couple of years, most of the gains in the S&P have come from technology,

and especially from the Mag-7. If you look at year to date, the Mag-7 is accounting for roughly one third of the performance of the S&P. If you look at 2024, it accounted for 53 and 1 half percent of the returns of the S&P. And if you look at 2023, it was 60%. So we really want to see this broadening,

not just in these big mega-cap names, but in the rest of technology. There's lots of opportunity in AI, in data centers, in cloud computing, in infrastructure. I think there's a lot to be said about some tailwinds coming into the year. How do you approach the scrutiny around spending? I mean, the market has so far rewarded certainly for the chips, but even the hyperscalers,

all of the billions, hundreds of billions of dollars that they're spending on AI deployment and infrastructure, how do you decide as an investor whether it's worth it? Well, that's a very good question. You see some of these mega cap names who've really spent lot- there's a recent acquisition scale AI- that was a very expensive acquisition for Metta fourteen and- point three billion dollars they spent. And so we're sending we're seeing some companies spent a lot we're seeing other companies really lag on spending and that there's been some pressure on a couple of the names on the on the mega caps. Where we really haven't seen a lot of acquisitions for years. Just to give you an example not to talk about any specific stocks or

to recommend any specific stocks but Apple for example hasn't had a major acquisition since Beats which was 11 years ago. So again I think that you have to be careful when you say there's a lot of spending because it's a mixed bag. Right now I kind of don't even count I'm talking mostly about the hyperscalers. And that has been the story of the quarters when it comes to a Meta or an Alphabet or an Amazon or Microsoft. And they have done well lately and they have been rewarded for the infrastructure they're building out.

The question is what the returns look like on the other side. Well, and that is a question yet to be seen. We have really not seen as much as we would like to see come out of the spend on AI. However, we know that there's about 1.8 trillion expected to be spent on AI over the next five years. And so again, there's a lot of spinning going into this area. There's a lot of hype going to this area. You're seeing some of these mega cap names lay off some of their software engineers. And so you're starting to see some productivity gains.

And I think that'll continue those productivity gains and increase in margins from, I hate to say it, but laying off employees because AI can improve the technology, hopefully will be again a tailwind for some of these technology companies. And then when you say technology, I mean, is there, earlier today we were

talking to an analyst who was saying it's at the coming at the expense of the software, the SaaS companies, which were so popular for so long, but now it's all about AI. How do you distinguish between the winners and losers within tech space right now? That is the challenge for all of us. I'm based in Silicon Valley, and so I talk to a lot of my clients who are really forefront in the development of AI, forefront in some of my clients who are really forefront in the development of AI, forefront in some of the companies that are looking at how to implement AI. So that is really an area that you have to be very very discerning. I can't talk about individual names,

Sarah, but I think really that is the question of the day is who are going to be the winners and the losers. And remember there are about 5,500 AI startups. So there's a lot out that there aren't even trading. And again, we've seen some pretty massive acquisitions recently. I think that'll continue. These companies are spending on talent. They want the talent. And we're really hoping to see that it pays off.

But again, these big spin projects have to have years to play out. This is not something that's gonna come up for the next quarter. We're not gonna see this on the next earnings call. It's gonna take time to deploy and play out. This is not something that's gonna come over the next quarter. We're not gonna see this on the next earnings call. It's gonna take time to deploy and play out. Okay, well Cheryl, thank you for joining us. Doubling down on some of those Mag-7 plays.

We appreciate it. Cheryl Young from Rockefeller Global Family Office. Up next, we are tracking the biggest movers as we take you into the close. Kate Rogers standing by with that. Hi Kate. Hi Sarah. Shears of a pharmaceutical giant having their best day in two

years and a chip stock is warning of the potential for no growth. The names to watch coming up after the break. Just about 15 minutes until the closing bell. Let's get back to Kate Rogers for a look at the key stocks to watch. Kate. Hi again Sarah. So Johnson & Johnson shares higher after it reported better than expected results and raised its outlook for the year. The pharmaceutical giant also slashed its 2025 estimate for the impact of tariffs, which it now expects to be about $200 million. Shares up about 6%. That's their best day in almost two years. Meantime, ASML sinking after the Dutch chip giant warned of the potential for no growth in 2026 amid

economic and geopolitical uncertainty. The company did report better than expected earnings and revenue for the second quarter, but not enough to boost its shares. They are down as you can see, just about 8% Tara back over to you. Yeah. Ugly day for that stock. Thank you, Kate. Coming up crypto stocks rallying over optimism that the trio of crypto bills are back on track.

We've got the latest from Capitol Hill. Closing bell back after a quick break. We are now in the closing bell market zone. United Airlines reports after the bell. Phil LeBeau is on that watch. Plus, Emily Wilkins has the latest on where things stand on the crypto bills. And BTIG's Jonathan Krinsky drilling down on the markets as we head into the close. Let's start with Phil. What should we watch for with United? Three things to look for, Sarah. When United reports in just a couple of minutes. First

of all, what's happening with the basic economy passenger? We know the premium passenger paying for first class or business class that remains strong within the industry. What's United seeing in terms of the person looking for an economy class ticket? What's the hangover from Newark? Remember mid-April is when Newark had all of the problems. They had to cut back their flights. How did that impact Q2? What's the impact in Q3 in the rest of this year? And that also impacts what's the revised guidance for 2025? When you take a look at what they're expected to report for Q2, the number to look for $3.81. The guidance, remember they gave us two guidance, full-year guidances if you will, after the first quarter, $7.09 in a recessionary environment, $11.50 to $13.50 in a stable environment.

What are they seeing now? We will be talking with Scott Kirby, CEO of United Airlines, tomorrow morning, first on CNBC, on SquatBox. You don't want to miss what he has to say. A good snapshot of what the economy looks like, especially when it comes to that basic economy passenger. Are they flying less? Is there less demand? All of those questions. Yes, remember that was right after Liberation Day, it was like the first one to report and so they did two, two guidances, guide-eye, guidances. Phil, yes, I recognize where you are. I know you're in the hometown, Cincinnati, Northern

Kentucky Airport. Yes, you're there for GE Aerospace with a big interview. What's the story there? Q2 results come tomorrow morning and then we talk exclusively with Larry Kullt, CEO of GE Aerospace. Remember, this is the first chance anybody's had to talk with him since the Air India crash when that happened, what, last month? GE's engines are not implicated in terms of being a cause behind that crash, but it's a chance for us to talk to him

about what the hangover effect, if there was any from that investigation was. But more importantly, look at this chart. I mean, this says it all. They have way outperformed over the last three years. And Larry Culpe said time and again when we've talked with him, they're just scratching the surface in terms of margin expansion as well as efficiency. So we'll talk about that tomorrow. We'll see if they

give us some updated guidance for all of 2025. Yeah, good looking chart. Thank you very much. Philibot. There's graders in terminal A, I think. That's our filibu in Cincinnati. Emily, this time yesterday the crypto bill was a little bit in peril. What's the latest? Sarah, we are, it is like Groundhog Day up here. The crypto bills are once again in peril. The House again moved to take a vote that would have advanced those three bills, led to ultimately votes on the individuals bills, the stablecoin, the market structure, the anti-central bank digital currency. But again, this rule does not have the votes it needs to pass.

And it's being held up in part by these hard-line conservatives saying, hey, we need more assurances that there is indeed going to be a ban on the Fed from creating a central bank digital currency. A number of members were just in a meeting with speaker Mike Johnson. And the trick here is is that Republicans do support a ban on preventing such a currency from being created. It's something the crypto industry wants, but they're worried that if they try to combine that with say the market structure bill, that it's just going to make it more difficult to pass in the Senate. Spoke a little bit this afternoon with Congresswoman Anna Paula Luna.

She was one of the members who was at the White House last night with Trump and had some concerns about the central digital currency. Listen to what she had to say on this. The people that are drafting this want to ensure that there is a CBDC. There's a lot of Democrats in the Senate that want a central back digital currency. That means you don't have privacy and you don't have your own autonomy in the financial markets. And so we make sure that we have to kind of tailor our legislation to ensure that we can get around that hurdle.

There's a lot of uncertainty right now on Capitol Hill about what the next moves are going to be. We know there is bipartisan support for a lot of these issues. The question, of course, is how they all move through Congress. They want them all to wind up on President Trump's desk. But while stablecoin has a clear pathway to get there once it leaves the House, the other two bills would need to go to the Senate. And just because of their complexity, because of politics, because you need things to be bipartisan, it would be a lot more difficult to get done. Sarah? What's interesting, Emily, unlike yesterday, is these stocks are all moving higher.

I mean, Circle, especially up 20% with Robinhood, Coinbase, as well. Is the feeling that the White House, as long as President Trump, which he showed last night, is willing to intervene and get them over the line, that's where we're heading? Sarah, it could very well be. We've seen Trump close the number of

deals up here on Capitol Hill before. I will say from the lawmakers who I've spoken with, it does seem like everyone's more or less on the same page about what they ultimately want to get done. It all comes down to the process to making sure that they are able to get bipartisan support

in the Senate with Democrats. That's really one of the big holdups here. They want to make sure things get done. There's disagreement about how to best do that. Got it. Emily, thank you for all the back and forth on crypto. Let's bring in BTIG's Jonathan Krinsky. And let's just start there, your technical analyst,

on Bitcoin and what the chart signal could happen next. Hey, Sarah. So yeah, Bitcoin's had an impressive move, about a 25% rally from the June lows to the highs we saw just a few days ago. And it had a bit of an ugly reversal over the weekend into Monday. So we think it probably pulls back to the breakout point, which is kind of 108,000 to 110,000.

Got it. So, and what do you do from there? Is that a buying opportunity? You know, when you're trying to think about one or two steps ahead, you want to see how it reacts to that support, right? I mean, if it pulls back and holds that, then for a couple days, that's probably a good buying opportunity. And it should. I mean, that's the thought being, you know, it spent several months trying to break through that. And so it would be, you know, the odds do favor that holding a

support on a pullback. What about stocks and particularly the relationship with treasury yields? This time yesterday, I was here on the desk and we also we actually saw the Dow and the S&P sort of crumble into the close as yields firmed up. Today, we're seeing the opposite. Stocks are supported, yields are moving south. Is that the key to whether this equity rally can continue? Well, I think, let's take a step back. Today is the 57th consecutive trading day

where the S&P is going to close above its 20-day moving average. And believe it or not, that's the third longest streak going back the last 30 years. So we're at a pretty impressive duration for just even a short-term pullback. If you think about how hard that is, the 20-day moving average is rising over 10 points a day. So by definition, the market has to keep moving higher just to stay above it. So that's the backdrop. It doesn't mean we have to have a big pullback, but I think a short-term shakeout, the clock is ticking. And then you add to that a couple other cross-asset,

as you mentioned, I think yields are always the rate of change rather than the absolute level. So, if we're talking about 30-year yields, for instance, the prior highs over the last year or so has been 5.15%. I think you would need to see a meaningful break above that, probably to 5.25%, 5.30% in short fashion to really scare stocks. But it is a concern we're watching. You add to that the dollar, which has quietly been up eight straight days. If you think about the correlation since the April bottom, it was a precipitous fall in the dollar that led to a pretty meaningful rally in stocks. There's a pretty big inverse correlation right now between stocks and the dollar, and now

the dollar has rallied for eight straight days. I think that, again, could be a headwind if that dollar rally continues. You're a little cautious here. I think tactically, you want to be a headwind if that dollar rally continues. So you're a little cautious here. I think tactically you want to be a little cautious. We're also seeing, you know, sentiment is, you know, really down 180 degrees from where we were in April. Whether you look at the survey polls, whether you look at the transactional data, some of the prime brokerage data, you know,

getting a bit frothy on the sentiment side. And then you also have, you know, areas of the market that, you know, the non-profitable tech stocks, for instance, are going a bit vertical, we'd say. And so there's some signs for short-term froth. Again, I don't think it has to be anything meaningful, but just a garden variety pullback to kind of that 6,100 level makes sense to us here. All right. Jonathan, not saying it yet, but Jonathan Krinsky, you've been warned, VTIG, we appreciate it with the technical take on the markets.

As we head into the close, we are looking at a record close for the NASDAQ, up a quarter of 1%. We've got green across the screen, which is not where we've been all day long. Had some Powell drama, President Trump put that to rest, and now we have a nice rally. In the lead, we do have technology working again but it's actually healthcare doing better today. Real estate, financials, industrial, materials, consumer staples and utilities. Energy lagging again today. New 52 week high for Palantir. Tesla adding to the rally as well. That does it for Closing Girl.

Now I'll send it into overtime with Morgan Brennan and John Ford.