Closing Bell - Closing Bell 8/27/26

Episode Date: August 27, 2026

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

All right, Brian, thanks so much. Welcome to closing bell. I'm Scott Wobner, live from Post 9 here at the New York Stock Exchange. This maker break hour begins with the market's peculiar reaction to that amazing Nvidia quarter. Yes, stocks are up, but not in several of the places you'd expect. And we'll follow that over this final stretch. Here's the scorecard with 60 to go in regulation. Yeah, it's a good day. I mean, we're green across the board. It's a super strong day for Nvidia after its guidance just blew away investors. Take a look. The stock up near 8%. So, it's a good day. pretty good there. But now take a look at several of the other semiconductor names, and it's a mixed picture. Broadcom's good. AMD is red, Micron is two. Take a look at Marvell. It reports tonight. That's a closely watched report. I get the stocks off a ton this year, but it's down today. Now look at the mega caps. The same uneven trade, Microsoft Green, Apple Green, Amazon Red. Nothing uneven though about the software trade today as a trio of great earnings reports lights that trade up. And in a big way, huge gains a day for Salesforce CrowdStrike and Octa, the best day, in fact, for Salesforce since 2020. It does take us to our talk of the tape where the markets do go from here

after this major Nvidia clearing event. Let's welcome at Adam Parker. He's Trivariates founder and CEO. Welcome back. Thanks for having me. Is it peculiar to you as well based on what happened? You know, one of the things I just haven't figured out yet I've been like up to minds all day on is how much do I want to believe a company in the semiconductor industry when they have visibility on 2028? You know, I felt what I learned somewhere in the last 30 years was they don't have a ton of visibility, six, nine months out. That's why they've never gone this far out. Yeah. They've never done that.

Yeah. Yeah. Right. Yeah. Right. So it worked. For that name. For that name.

And I agree. And you would think it would have maybe made Mike Run go up just because they told you memory-constrained the current conditions a little bit. So you'd think, oh, on the margin, maybe I take my micro-view up in it. That's not in the price today, right? So I agree. It's a little congruous. And I just, you know, sure, they have contracts that are five-year-year-year-old. Sure, they've now put in some penalties for cancellation.

But they're kind of de minimis relative to the overall. In other words, I've just, I thought I learned somewhere to mistrust two-year-out demand indicators. Well, especially in a space that is, as you know better than almost everybody is, so cyclically driven. Yeah, this is a cyclical industry. We're confused about the period of the sea and amplitude for sure. Current conditions are great. We know they're going to roll over pretty hard eventually.

So it's like a giant game of chicken that we've got a time. You know, I was just putting the initial part on my weekend note always right, and I was putting that photograph from Kevin Bacon at Footloose, where he's going with the tractor toward the other tractor, and his shoe lace gets caught. You know, I'm not 100% sure when I got to veer off here. and I could see some people saying, look, I'm a little worried. That gets running hot.

Like, Micron's going to do 86% gross margin in a cyclical business, and this kind of tells you how hot it is. So, look, I think near-term conditions are so strong that these companies can grow through it. As you know, we said we liked Nvidia. We still do. I like Micron too. You said you thought Micron was going to double. And by the way, you just said Micron as a cyclical business.

I mean, the CEO, now I know, you're going to say, well, what is he going to say talking to his book? But he made the point. just last week with Kramer, that maybe it's different this time. I mean, used to be a semi-analyst. I think it already is different. I feel like we were raised somewhere to duck lightning bolts to say it's different this time as if you're an idiot if you say that. But to those people, I'd say, look, it's already different. You already missed it.

It's already over a trillion market cap. Like, what do you mean? It's the same. I think the question is, how fast is it a road? Do they really lose money in 2029 or beyond? And I think one thing that Microd is not getting credit for is the balance sheet. So, sure, I could look at a single business, say I pay five times peak earnings, 11 times normalized or roughly where trades now. But what if they run with 30% of the market cap and cash as opposed to net debt?

Like, shouldn't I care a little bit about the massive amount of money they're making in the next six, seven quarters? I think you should, and I think they should get credit for it. The critics would say, well, but they're signaling and they're going to buy back the stock, and I think the stock's overvalued. So that's where they're getting, I don't think, full credit for how awesome current conditions are. So you used to be a semiconductor analyst at Bernstein, right? you preceded Stacey Raskon. Right. Right.

Yeah. So if you were sitting in that seat today as yourself, obviously, not telling you what you, not asking you what you think he should do. But would you take a look at the NVIDIA report and what would you do to shares? Would you, and the other names in the space? Would you be tempted to upgrade or rate, I mean, up, they're already probably buys, but raise price targets on almost everything? I like Semi still. I don't think we've reached highs for the major companies here. I think NVIDIA will be way higher at the end of the cycle.

I still think we're three years, four months into an eight-year cycle that the market will probably discount a year or two in advance. So I think we're headed higher over any meaningful period of time, but you just have these periods where you have to digest news. There's 567, I think, levered or inverted ETFs in the market right now. A lot of them are triple-long and double-long. So you're just going to get a lot more volatility around these prints. But ultimately, I think we're still headed higher just based on the hypers' ability to borrow more money to fund the growth for a sustained period. Would you be, how would you be assessing the data center backlash as you're looking at estimates for semiconductor companies? And if you believe that it's going to be a bigger issue even than it is now, would you be tempted, at least in the near term, would you be tempted to take some of your estimates down?

because you think this is that durable and existential, potentially for, let's just say, for the next six months? Yeah. Yeah, I mean, I guess I shouldn't be surprised, but I am a little that it's 23 states that are bringing up issues with data center construction. I always thought it would be a little note specific. I guess when I look at companies with exposure, I still see a pretty big gap. I'm not saying CAT should trade at parity to micron. One seems to be at 10, 11 times normalized and one at 30. The charts sure looked similar for a while, didn't they?

Yeah, but they should, to me, be closer together. You can't argue that you're going to construct these things forever and pay a high multiple for one business, and then they're massively over-earning for the other. The truth's in between. So one of the things we do is we tag every stock in the market. Do you have meaningful AI revenue? What bucket are you in? Are you memory in semi-cap?

Are you vertical on edge? Or you platform or you, you know, data center. And I think you want to be overweight AI revenue still, but I think you have to be very careful about what pocket you're in. And I would probably sell a little bit of the longer dated businesses that require five more years of spending to make the math work. Okay. So moving from semis to software, you preferred semis over software. And you made that case a million times. Were people too quick to make that call? And what do you make of the fact that on a day like today,

Nvidia basically gave the green light for semis, and yet they're super mixed and software's ripping? And Salesforce just had its, you know, biggest gain today. since 22 and the cyber trades ripping. We're going to have more specifically on a couple names in a little bit. But is that now the place to be because there's so much ground to make up? Because the stocks, although they're up a lot recently, are still down almost by a name year-to-date. Yeah. Look, I like cyber. That's the one part we've said we like. And maybe the synopsis reported too. I still think those businesses are worth more. But generally, I don't think you want to buy overweight position in soft. Now remember when you're indexed against the S&P, Microsoft's still more than half the market cap of all software. So it's kind of nuanced. If you want to go over it software, you're basically saying I got a big position in Microsoft. But if you go to the name by name, I still think what you saw from Intuit last week is more going to be the base case than we saw from Salesforce last night. The businesses are ultimately going to miss on earnings because the cell site ain't will still have 80% gross margin and the same net margin in their estimates. And when companies missed, they're just getting killed. Yes, Salesforce got changed.

cheap, it's been beaten up. I think the reason is probably still in play, which is that their five-year forward estimates are seriously in jeopardy. So I think what we learned is the demise of them will be a bit longer, maybe then, maybe I got too barracks on how fast they would erode. Well, maybe, but you're still going to erode. You're still talking to them as a group, though. I mean, look, for every, for every into it, there's a snowflake or, you know. Snowflake, Palo Alto, crowd, data, like the ones that are fast growing that are more expensive, those are on our screen of the ones in software you like. It's the ones where you've seen multiple contraction where they look cheap that you want to avoid. Salesforce is having a day in the sun today, but I still think

they're structurally impaired, and that's what the multiple contraction over the last, you know, 18 months is told. So we're going to, we're going to drill down, as I said, on a couple, couple of other names that are just having great days. Yeah. And it's worth doing that. But bear with me. I want to add some voices to our conversation. Let's bring in J.P. Morgan, Stephanie Aliaga, requisite capitals, Bryn Tockington. Brin's a CNBC contributor. Step, I'll begin with you. You've heard the whole conversation here. What are your thoughts on this market reaction?

Yeah, I agree with a lot with Adam just said. I think over this summer, we've learned that AI demand is very real. You know, yesterday's earnings report reiterated that. There is a ton of demand coming online. And if you just look at OpenRourters data of how much agents are consuming and tokens, that's up 14% from February this year. So there's all of this data, and we're still very, very early. But the challenge for investors right now is that, okay, we're so used to great news.

How sustainable is this great news? How sustainable are these memory margins? Are these chip earnings results? And I think that is the risk, particularly as debt is entering the story more and more. And markets continue to be quite susceptible to positioning on wines, which are happening quite rapidly. Bryn, the irony of this whole thing today is that we went into, and video, earnings report saying that, well, this isn't really about Nvidia's stock specifically because it usually doesn't do

anything on the back of an earnings report, and they blew it out, of course. And it's dozens or hundreds of other names that we really need to be hyper-focused on after Nvidia reports. And here we find ourselves exactly the opposite. It's Nvidia, which is the big winner, and some of these others are more mixed. What do you make of that? Well, first of all, I think this is a reminder for investors.

don't react immediately because when Collette came out on the call and said they're going to raise their guidance, that's really when the stock and the overnight trading started to rip. And what you and I have been talking about, Scott, is, you know, the stock has not been able to get over the 230s. It actually touched 230 today and got rejected down. So as an investor, whether I'm a trader or long term, it needs to get over that, like, low 230s for it to go higher. If it does that, I think it goes meaningfully higher, but it's not there. To me, when I ask myself as an investor, why is it not up more today? And I listened to the call, read through the financials. I will say that, you know, account receivables made up 66% of quarterly

revenue. And for certain clients, those accounts receivables are 90 days to a year. And maybe those are Google, AWS, Microsoft. But I do think the market is saying part of today's move, which is nice, but I feel like should be higher, is maybe a dollar of Nvidia finance revenue is not an actual equivalent to a dollar of customer revenue. And so I do think this skepticism that we have in general is very healthy to this AI market. It does, I think, help limit at 2021 in 1999 because we're all very skeptical. But I do think it's peculiar, though, that Micron IOMD RAM is not up huge today. I think it was Collette or Jensen that said that their commitments, mainly memory, are going from

$119 billion to $279 billion, most of which is memory, yet DRAM is down today. So I do think that was a peculiar move in the market, but I do think investors need to read those signals. These are great numbers, but why is NVIDIA not more? And so I balance that out. If it gets above 2.30s, I'll probably add to the position. Well, do you think, Bryn, that the market is skeptical? or doesn't trust that 70% number,

that maybe this is viewed by the market or some investors as trying too hard, as an attempt to get a stock moving that hasn't been moving all that much. So you throw out a 70% growth number for 2028, suggest it could even be larger, if not for supply constraints, but it's so far in the distance,

of what a market usually looks at, that it can't really put any cred into that number. Is that at play? I agree with Adam. Be careful about 2028 numbers. That being said, I feel like the two best CFOs are Amy Hood and Collette. And so when Colette's saying this,

I'm going to say that, well, her lens has been very accurate. I feel like she's conservative. And so we'll see what happens in 2028. A lot of things can change. I think that's a, that's a, with the data they have today, I'm, I'm going to believe what she says because she's, she's incredible. But I do think that just the skepticism for multiple reasons is, you know, is real. I also think, though, that at the end of the day, the LLMs will be commoditized.

We're going to go for the cheapest fastest and that the application layer, which I mean goes back to Salesforce today or the IGV, that application layer is ultimately going to be a really good space to be in the market because we're not just going to plug into Anthropic. It's our open AI. We need that safe application layer as me running a company that I can trust. Do you think that's at play? What I asked, Bryn? Yeah, I think that, look, a lot of companies went to Oracle 20 years ago and they couldn't get off it in their worry. You know, like it's stuck. And so they're going to try to keep open source. They're going to try to wait until the last minute to commit. They don't want to commit to either Open AI or Anthropic or whatever. They're going to try to, you know, manage that

you know, Bryn's a lot better trade than me, so I don't know about the 230 or not. Like if I look out 12 months, I think the thing can be much higher, you know, 300 or something. You know, so it's the, you know, what I'm trying to look at now is like which companies, even if I continue in bed, price to earn its contraction, could just grow through it. And if you just even believe two-thirds of the projection they gave you to 28, man, the multiple is going to have to go to like, you know, four times for the stock. You know, you can absorb a lot of multiple contractions. So that's why I think it's a buy in the long term,

but I don't doubt her at all on the technical's near term. What about some, you know, okay, we got past this as we call it a clearing event. We got to look forward to chair Warsh tomorrow, obviously. Markets can be fixated on that. I mean, how do you feel about the market in general for the next few months? Yeah. I mean, I do think the washer that we saw this summer puts us in a healthier place today. Markets are leading with skepticism.

Discipline is helping keep this boom from becoming a bubble. In some ways, I think that that skepticism is even overemphasized, particularly when it comes to the debt issuance and the lack of a rally that some of these stocks are getting on phenomenal results. But there are macro issues that play here, too. We're learning that tech stocks are not immune to higher interest rates, and I think the backup and long-term yields has also played a part in some of this volatility. Now, tomorrow, we're going to hear from Warsh in a very highly anticipated speech, and I think

there's not much to fear from this meeting. This is a scripted meeting. There's no Q&A. He is an opportunity to really, like, cover some ground here when it comes to his communication of the Fed's determinants to squash inflation, to achieve its dual mandate. And I think that he's going to try very carefully to do just that without delivering any undesirable surprises to the market. Okay, thread the needle. We'll see what happens. Steph, thank you. Bryn, of course, to you as well. And Adam, thanks for being here. Good to see everyone. Well, we'll see everybody soon. Sales Force. It isn't the only software name getting a big boost today. We alluded to that. Mackenzie Seagallis has more on these moves today in Octa and CrowdStrike out of cyber. Hi.

Hey, Scott. So CrowdStrike and Octa surging today after better than expected earnings and stronger guidance with both companies saying that AI is driving more demand for their cybersecurity tools, shares up 20% and 30% respectively. Now CrowdStrike CEO George Kurtz calling it in arms race with AI. making attacks easier to launch at the same time that companies are deploying huge numbers of AI agents that now need to be secured. That is especially good news for ACTA because all of those agents need identities and permissions inside a company's network. Octa says that it won dozens of AI-related deals last quarter, though management still calls this very early days. CrowdStrike and Octa have now both more than doubled this year. In Palo Alto, Z-Scaler and SalePoint are moving higher today as well. Bank of America

upgrading Octa after the print pointing to that accelerating AI opportunity, though it still sees limited upside from here, Scott. Okay. McKenzie, thank you. Mackenzie Segalis. We showed you shares of Hormel. They are slumping today. Brandon Gomez has more on that. Why is this happening? Hey there, Scott.

Yeah, Hormel Foods cutting its sales outlook as the food maker says consumers are pulling back on spending. Now, the spam and Skippy owner reported third quarter revenue of $2.96 billion, down two percent from a year ago, and below expectations. Hormel now sees full year sales of up to $12.2 billion. That's down from its previous forecasts that topped out at $12.5 billion. Now, the company was already anticipating a difficult

Q3 because it divested from several businesses, but volumes were even lower than expected. Interim CEO Jeff Eddinger saying that's because shoppers pulled back across its branded retail business. Higher fuel costs are assumed to remain elevated as well, while Hormel tries to streamline its portfolio. You can see now shares down about 9% Scott. All right, Brandon, thanks. Appreciate that. Brandon Gomez. Just getting started here up next live from Jackson Hole. The setup ahead of Fed Chair Warsh's

keynote speech tomorrow. We'll speak to former Cleveland Fed President Loretta Mester as well. All eyes on Jackson Hole where Fed Share Warsh will deliver a highly anticipated and potentially market-moving speech tomorrow. Our senior economics reporter, Steve Leasman,

is there to set the stage for us. Hi there. Hey, Scott, yeah, you know, the Fed chairman's speech, we always listen really carefully for, you know, clues about his outlook for rates, hawkish-divist. This year, we're listening for whether he talks about policy at all. Remember, Warsh has held back on his views about if he wants to get a cleaner message of market pricing. But luckily, his colleagues here in Jacksonville, they have not been shy about offering their outlook, Scott. I believe now is the time to act. I believe that we've been in an inflationary situation for more five years. It's been running well above our target. I don't see any restriction in policy.

I think we may be a little bit more accommodative, certainly more accommodative than restrictive in the policy rate. Now, Schmidt said he thought the Fed officials could talk less while Hammock offered it was, she thought it was her responsibility to share her policy outlook. Tobias Adrian from the IMF writing today, broader communication about reaction function remains essential as long as it is conditional, disciplined, and uncertainty aware. Risk should be clearly spelled out, he said. Now, Warsh could tomorrow make a distinction between what he's willing to say and a speech on his own compared to when he's representing the committee after a meeting at a press conference. So maybe we get a little bit more than we thought we're going to get tomorrow's country.

We'll see. It's so highly anticipated. I can't wait to see what happens. You'll bring it to us, of course. You'll be there. We'll see if we get the walk and everything else. Steve thanks. That's our senior economics reporter, Steve Leesman. Now let's bring in the former Cleveland Fed President, CNBC contributor Loretta Mester. Welcome back. It's nice to see you. Thanks, Scott. Good to be with you.

What do you want to hear from Chair Warsh tomorrow? Well, I'd like to hear what Steve Leesman has just been talking about, really getting a sense of how he's thinking about the economy. So not forward guidance, but really what's the framework around how he as chair is thinking about the economy, inflation, maximum employment. I do think we're not going to get that, though. He's been very explicit of not wanting to present any forward guidance about the September meeting or even forward guidance or anything that could be construed as forward guidance. So I think we're going to be a little bit disappointed in what we hear from the chair on that particular thing. I think he doesn't see that there's a problem that needs solving with this communication. Instead, I think we'll get more of what you usually see

at Jackson Hole when there's a new Fed chair, which is really a big picture view of the economy, how it's changing and what it means for the Fed. So you clearly think he needs to give the markets a little bit more? Well, I would like to see that. I think the public, too. I mean, it's an accountability issue.

We want to see how a Fed chair is thinking about the economy. He doesn't have to promise us anything, but just how is he seeing it? What does he look at? How is he evaluating the current state of the economy? an explanation of why perhaps they made the decision they made in July. And, you know, not about September, but just explaining what he did in July and why. I mean, he's obviously intent on making significant changes to the institution and how it goes about its business.

Some suggest that's a much-needed evolution, while others say this is a revolution, that it's taken. it too far. Where do you come down on that? Oh, there's lots of things that can be improved in the process of the Fed. And a lot of the things he's laid out, I think he will have members of former and current members of the FMC on board with. But we don't really have much insight into exactly what it is. The task forces, I think, are well constructed. The people on there are experts in the field in both theory and practice. And I think there's going to be some good things to come out of that, then the FOMC will take it up and deliberate. What about the idea of fewer meetings that's been tossed around? He said, do we have talked

about that? I think the last minutes mentioned that. Would you be in favor of that? Does it matter if there are two fewer meetings? You know, I think you can come down on either side of that. The benefit of having fewer meetings is that you have more time in between, but you may end up making policy a little bit bigger steps, if you will, because you're going to be going in fewer times. So I think there's worth talking about it. I don't think it's going to be a substantive change in how the FMC deliberates and makes policy. How do you view what the Treasury has done, intervening in the bond market and whether that is at odds at what the chair is trying to do with the Fed, if it complicates the road ahead now for Chair Warsh and the others on the committee?

Well, I do think it's ironic that you have Kevin saying, we want clear signals from the market because that will help us make policy, and then you have the Treasury going into the market, trying to change sort of what those market signals are. However, the other thing Kevin Warsh has been saying all along is that Treasury manages debt and we manage price stability in a context of maximum employment. So to that extent, again, I don't think he's going to address that tomorrow in his speech because I think, you know, he wants to stay away from that and allow. I do think it complicates things a bit for him in the sense

that, you know, it was cleaner when he could argue that we're going to be able to take the market signal and that's going to help us make our policy. Play the ball, not the referee, is the way he put it. You also had the, I think, the feeling that he wasn't all that upset with the fact that the longer end of the curve was backing up a little bit. It was helping him, maybe buying him some time doing the Fed's job for it while he lets the task forces do their job before he may give us the information you're suggesting we need. Yeah, but I don't really see that as a good argument in the sense that, yes, it can be restricted on the economy. But you've got to understand why are those long rates going up.

And if you're not willing to make an action with your own policy rate at the short end, then there can be an inconsistency there. And that could be telling you that it is time for the Fed to take action. Certainly the economics case for or taking in action and raising rates, I think is an easier case to make than the case of standing pat. And I think we want to hear a case for Standing Pact, given that's what the FMC did the last time. What was the case for that? Why do you think rates at the long end are going up?

Because they may, in fact, be going up for things that the Fed can't control at all. Can't control the amount of paper hitting the market to fund the data center and the AI infrastructure build out? Yeah, I think there's a bunch of things affecting that long rate. I think it's partly fears about the fiscal situation in this country. concerns about it. I think there's inflation in there, even if the market-based measures of inflation expectations haven't moved up. I think part of that what's going on is that people are still questioning. And I think there's uncertainty. There's uncertainty about the Fed's framework, and that is something he could address with communication. And so, again, I think we would all be

better off, but we heard more about the Fed's framework. And I think over time we will. I think at the moment, he doesn't want to be doing that because he had a strong message, which is we're changing the way we communicate with the markets. So, you know, I call it tough love. I mean, the markets are going to have to be on their own for a while and make decisions about where the economy is going, and then that'll send a signal back to the Fed. Well, he also, in some respects, is like, let the task forces cook, and then we can see what needs to be changed on the menu. But we need to see what they come up with. I've charged them with coming up with certain ideas. So let's see that first and cut out all the criticism that people are levying at me before we see that. And then we'll go from there.

The market can certainly live with that, can't it? Well, I think we are waiting for that. I think, you know, it's always a dangerous thing to wait for the next thing if you're a policymaker. You got to play the economy as it is. Now, does that mean it's urgent that they raise rates at this moment? Perhaps not. But I don't think you necessarily have to wait until, okay, all that's worked on. There's always another study to be done. There's always another data point to receive. And you really need to be making sure that your policy is well positioned for the economy as it is. And sure, you might learn some things from the task force that suggests that you can change your procedures. But at this point, that's a longer term,

I think program, not something about policy over the next four months. Former President Mester, it's good to have you on our program ahead of this highly anticipated speech. We'll talk to you soon. Thank you. Good to be with you. All right, Loretta Mester coming up with NVIDIA earnings. Now in the rear view, what is the next possible catalyst for stocks beyond what happens this week? Fund Stratt's Tom Lee. He's here at Post 9 with those answers next. We're back now that Invidia earnings out of the way.

What does it mean for stocks of the weeks ahead? Let's welcome in Tom Lee. He is Fonstratch Managing Partner, Head of Research, also as CNBC contributor. It's good to have you back. Great to see you. I said at the very top of the show, it's kind of peculiar, the market reaction to this today. Invidia's having a great day, but it's kind of mixed elsewhere. What do you make of that?

I mean, I think it's a healthy market, Scott, because invity had good numbers. So you want Nvidia to go up on good news, which it did. It's having it. Which it rarely does. Yeah, and it's rare, so it's breaking a pattern of people thinking people don't care about the earnings, it really did matter. And I think that we are seeing a positive response in software, which of course is on good numbers. And those names are downstream of the AI trade. So I think it's actually an overall healthy reaction.

I know, but the software moves are so specifically related, really, to what we got from salesports and CrowdStrike and Opta and others. I find it interesting that meta's down, Amazon's down, Alphabets down, AMDs down, Microns down, Marvell's down, Coralweaves down. I wouldn't have expected that after NVIDIA delivered what they did. Yeah, I mean, it's also possible people were using those names and not having exposure to NVIDIA, so they've got to find a source of funding if they have been underweight NVIDIA. And again, I've heard it from many guests on CNBC. The thing that stands out is NVIDIA's multiple is still very low. So they've got these huge revisions.

The stock hasn't kept up. now the PE keeps contracting. Yeah. So where is your overall market take right now? We're not that far from the end of the year, believe it or not. Yeah. Are you still looking for a meaningful correction before another ramp up, or does this report from NVIDIA do something to take that off the table?

Well, I think August is going to still end on a very strong note. So this week was our thoughts. It was a clearing week. The third of that clearing event is tomorrow with Kevin Warsh, which I think the market should react positively, just like last year. The S&P rallied more than 4% right after his speech. And then I think once we get to that 7,900, 8,000 on the S&P, I think that's a good pause point,

because then we think there's midterms elections. There's the whole movement in the yields, there's the prosecution of this war that's continuing in the oil pressures, and then there's supply unlocks. So I think there's things that the market has to sort of digest along with margins, debt, and I think that's going to be the source of a correction after this month. What about the data center debate, speaking of the midterms? That's only going to grow louder as you approach Election Day.

Now we're still a few months away from that. Yeah. But that feels like it's at play here, too, and why the market knows specific names just haven't traded all that well lately. That's right. It's becoming actually an issue that resonates with voters, and it looks like it's turned already, some election. like in Ohio, and then we're seeing governors in Republican states and pro-data-center states,

you know, supporting a pause. So you're absolutely right. It's become a political issue. I don't know if this is also maybe fueled by China, which wants the U.S. to slow down its AI efforts, but you're right. It's becoming an issue, and that's probably why the downstream trades are doing better, the AI downstream trades. What about outside of tech and AI? Have you take your lens, you know, in, you know, in in that direction? What do you see that you like? Well, there's still a lot to like because we know it's been a good earning season. Actually, one of the standouts has been small caps. So I think small caps continue their leadership because they're in the process of re-rating relative to large caps.

We like industrials and financials. And I think crypto has a lot of catalysts in the fourth quarter. So a lot of investors missed the crypto trade. You know, so far in the third quarter, best performing asset is crypto. Ethereum up 54%. if that continues in the fourth quarter, there's going to be a big FOMO rotation into that. See, if you think that yields are going to remain elevated and are a risk to the market in general, certainly on your list of possible risks, isn't that a problem for the small cap trade? Because you see it pretty correlated. Yes.

Rates go up, Russell goes down. Rates go down, Russell goes up. Rates are, I mean, they're up a little bit. Russell's up a little bit. Yeah, it's a, you know, there's a little dissection. If rates are going up because risk premium is going up, then that's bad for small caps. If rates are going up because long-term growth rates repricing higher, that's bullish for small caps because that's a good M&A environment. Well, it's been great this year.

21% beats everything else. Yeah. So good to have you here. Thanks, Tom. Great to see you. Tom Lee. Up next, the biggest movers. As we head into the close, we're back in just two.

are about 10 from the bell. Back to Christina now for the stock. She's watching. What do you see? Well, let's start with Wendy's shares, because they're dropping right now on a Reuters report that Nelson Peltz's Tron Fund. Management isn't planning to take a private bid for the Burger Train. Chain, I should say, not train. Tron has concerns about Wendy's performance and strategic direction, according to the report. shares are actually down about 14%. No one's commenting at the moment. Two discount retailers moving in opposite directions, despite both delivering better than expected results. The difference is in the guidance. Dollar General raised its full year forecast,

while Dollar Tree maintained its annual sales outlook and gave weaker than expected guidance for third quarter profit. That's why you're seeing Dollar General up three and the other one moving the other direction. Shares of Fox Corp moving lower on a Reuters report that Rupert and Lachlan Murdoch are, are considering a remerger of Fox and News Corp. Core documents obtained by Reuters showed that a 22 merger effort failed,

but that Rupert Murdoch could make a renewed attempt, even going so far as to prepare a letter to the boards of both companies. shares down 3% Scott. I want to thank you, Christina Parks and Nubelis. Coming up, what to watch for when a firm and Marvell earnings cross in overtime. We're breaking it down ahead of those prints inside the market zone, which is coming up. All right, we're now in the closing bell market zone. Mike Santoli and Northern Trust, Eric Friedman, are here to break down these crucial moments of the trading day.

Oliver Renick, standing by live from the Cibo Global Markets in Chicago. Two earnings movers will be watching for in overtime. Christine is covering of Marvell. Mac is back looking at a firm. We'll get to that in a second. But Michael, I'd love your thoughts based on what we got and what still lies ahead. Yeah, it's fascinating, Scott. Invidia is essentially accounting for 100% of the S&P upside.

The rest of the stocks in that index are basically. fighting to a draw. So a kind of a stark example of how we have this kind of top-heavy, uneven market on some days. But, you know, it's really not a detriment to the character of this rally because the rotation has managed to work pretty well so far. I also would note Treasury yields have remained pretty much sideways this week. So the last week was the week when we decided we had to panic about exactly how unanchored longer-term interest rates might get. We've been given a break from that concern. And then going into to Warsh tomorrow. Yeah, I wonder if the market would just prefer that he sort of punt on any real

pronouncements about policy and just really hope that the Fed gets rewarded in a sense for being able to be patient because the economy is not screaming out necessarily for action today. Are you surprised more tech names aren't up after what Nvidia did? I definitely know with interest. I don't think I'm surprised. Yesterday I was saying because of how Nvidia had traded into the number, there was room for relief there, but I did think the rally might get capped. I don't mean capped at 2.30, but just capped in the sense that we're not just going to pile in headlong into this trade again because of all the nuances, because of the sustainability and financing questions,

and even a lot of the things that NVIDIA's guidance had brought up about its supply agreements and all the rest of it. I guess you could make the argument that also is healthy. The market is trying to sift around and figure out the nuances as opposed to, you know, just essentially say, game on. We have to follow the spending. about five minutes away from overtime. Look forward to you then with those important earnings as well. Thank you, Mike Santoli. Oliver, let's play some options action,

and we're doing it with SpaceX today, right? That's right, Scott. It's about to close around $140 for about the 14th day in a row. That has changed SpaceX options pricing dramatically. Implied volatility, which was over 120 at the start of this month, has fallen to 55, which presents a Roershack test for traders. On one hand, it means it's never been cheaper. to trade SpaceX options, so there hasn't been a better time to place big bets.

On the other hand, 55 is still more volatile than about 475 of the 500 S&P stocks. So, VAL ain't exactly cheap. What's interesting is that so far, bears are taking advantage of this pricing faster than bowls with a ton of put volume crossing the tape, and now 60% of the total premium tied to puts today, almost all of which came from the last hour to two hours since I last saw you, Scott. Oliver, thank you. Appreciate that. Oliver Renek. Christina, set us up for Marvell, certainly one of the best performing chip names this year. Yeah, and there's three things to watch. First, the Google deal. So last week, Marbel signed on to help build Google's custom chips, specifically some TPUs. Google got a warrant for nearly 59 million shares, the stake worth almost $12 billion. Wall Street wants to know how much of that actually shows up in the outlook. Second, the outlook, the data center forecast. Investors care about 2027, 2028. The custom chip and optical networking business is growing.

growing more than 50% a year. The question is whether management actually raises the bar again. Lastly, the target. Marvell has a $16.5 billion revenue goal for next year. Some on the street think it goes to 18, but doesn't move tonight. Watch October 6th. That is an analyst day. So investor feedback is saying that earnings is likely not a big catalyst for the stock. October 6th on the analyst day could be the bigger catalyst as Marvell gives more details on expectations for the next few years. So we may not see as much of a reaction in this name tonight. All right, that's good perspective. I'm glad you have that.

Thank you. That's Christina Partsenevolos. Now to McKenzie on Affirm. What do we need to know here? So, Scott, a firm goes into the print with shares clawing their way back after a rough start to the year, when concerns around credit losses, short seller pressure, and a broader sell-off in high multiple FinTech names sent shares sharply lower. Now, revenue, it's expected to rise 26% year-over-year-over-year, helped by higher transaction volumes,

and a firm is expanding beyond the traditional buy-now, pay-down. pay later checkout button. Morgan Stanley pointing to its distribution through Amazon and Shopify, growth in its a firm card, and those longer duration zero percent financing options as key drivers. Oppenheimer recently raised its price target to $100, that's about 30 percent upside from here, citing that momentum and affirms history of outperforming expectations with revenue beating estimates in 18 of the past 20 quarters. Consensus looking for $13.4 billion in purchases made through a firm toward the high end of the company. guidance with Morgan Stanley pointing to a rapid profit inflection, even as a firm

shares, a firm continues taking share. The options of market pricing in a 10% plus or minus move after the Prince Scott. All right, Mac, thank you. See what happens. Mackie Sagalas. Turn to Eric now. Your thoughts on not only what happened today, but what you think it means going forward, especially for this AI trade. What do you think? Yes, Scott, we think that there's still legacy of the AI trade. If anything, Invidia just emphasized that 2020, needs to be on people's radar screens. They really talked about more of a supply constraint versus a demand constraint. That's what we've heard for a lot of other

companies. But I think is unique about Invidia, what's unique about a company like Amazon or obviously, to some extent, their larger, hyperscalular peers is there's differentiation between those who are monetizing and those who are not monetizing. And so I think what's being rewarded in marketplace is strong guidance, expectations about some clarity on circular financing. Obviously, we heard a lot of that today and last night from the NVIDIA's TFO. But bottom line is that that is a trade that we think continues. So we want to remain involved in beta. We want to be involved in domestic large cap, really still using that fixed income trade as the funding source. Last thing I'd say, you know,

real assets tends to be in an area that people are really underweight or just don't have in portfolios. We think tomorrow with Jackson Hole, having some real asset exposure is important for clients and important for investors. You think we get market moving stuff from Jackson Hole tomorrow? I think we get something. I don't think this is a case where Kevin Oersk can sit back and say, hey, I'm just benignly looking at the bond market. I think the chatter from Druckin Miller this week, the chatter from Scott Besant, you know, there needs to be an active communication between the Fed and markets. And so I do expect to have at least some indicators. And so I do expect to have at least some if not for more, from some of the governors that will be interviewed by the likes of CNBC and others.

So I do think some transmission mechanism is expected. It has to be an active conversation, not a passive one. Yeah, well, today was all about the equity market because of NVIDIA and the impact on other stocks tomorrow. Maybe more so about the bond market. It's good to have you on the program. Eric, thanks. We see it soon. You can hear the clapping's about to begin here because the bell's about to ring.

And it is going to ring us green. After what NVIDIA delivered. Now we'll see what happens in overtime with some other.