Closing Bell - Closing Bell 8/6/26

Episode Date: August 6, 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.

Guys, thanks so much. Welcome to closing bell. I'm Scott Wobner, live from Post 9, right here at the New York Stock Exchange. This maker breakout begins with the call of the bulls who say stocks are going much higher from here. And we've got one of them on our program today. Fundstraz Tom Lee, he'll be here with us in just a moment. And he's far from the only one who thinks 8,000 is the next stop in this rally. So we'll discuss that and more coming up. Let's show you the scorecard here with 60 to go in regulation. We have been read for most of the day, some weakness in tech led by a few semian. Software and today. We'll have reports on that in just a bit. SpaceX is higher today after its lockup expirations begin just following earnings. We're following that, of course, as well, more on that soon. Banks, they're a little weaker today after their recent run, so we're keeping our eyes on the broader market as well. Goldman's down about 2%. It does take us to our talk of the tape, the future of this rally, whether all of those bulls are too exuberant right now. Let's welcome in our panel, CNBC contributor, Fund Stratt's Tom Lee. Solace is Dan Greenhouse. We're all here at Post 9, as you can clearly see. Tom's good to have you. I'll start with you first.

You say we could go 7,900 to 8,000 this month alone. So this momentum's going to continue. Yeah, I think the de-leveraging that happened a couple of weeks ago put a lot of cash on the sidelines got sentiment quite bearish. And then on top of people getting very skeptical of the Fed got markets to de-risk. And now I think as earnings have been good, and I think there's a rethink of how inflation might be cooler than expected, and of course, AI is still strong, there's going to be a chase. I think that chase takes us towards 7,900, 8,000. Most people who are putting out bullish notes cite both of the facts that you did. This major de-leveraging process, which was a reset for the market. There was no real fundamental

change in anything. It was just, there was some froth that needed to be worked out. There was some leverage that got a little bit too high, and all of that needed to be be worked out. And then the backbone of the whole thing, the earnings. John Waldron of Goldman was talking about that just yesterday morning. Yeah, that's exactly right. I mean, earnings this quarter is coming in more than $15 ahead of what people expected at the start of the quarter, but what's really more impressive is 2027 earnings are up now $8. So we're probably close to 410 for 2027 earnings, and we're only three weeks into earnings season. I actually think it might settle out closer to 425 by the time earning season's over.

It sound reasonable to you? And it's not just Tom, obviously. It's, you know, I've been hearing more 8,000 calls sort of, you know, day by day with Ed Yardini saying his 82.50 could be conservative for the very reason that Tom just suggested. Earnings are just really good. Yeah, I mean, as we're seeing on the screen, the S&P is already, it's 7,700. So 8,000, no disrespect. I mean, it's not a huge list to percentage-wise. I think the implication, though, is like that that's just the next stop in this trend. Yeah, I mean, because the thing with the earnings is even if you X out technology and you subtract, say, 10 percentage points off the gross number, earnings are still good. And when you listen to it, as many of us do, any number of companies in any number of industries, the AI.

Almost all of them. Yeah, the AI story is going well from Eaton and 3M and those adjacent companies. You look at the charts of the KRE, the BKX, the financials are at highs. The KIE, the insurance companies are at highs. The commentary across the board from the card companies who I mention every quarter about consumer spending just fine. So you have all the investment themes going on, AI, power generation, et cetera, et cetera. The consumer is doing fine. Jobless claims two weeks in a row, sub 200.

For viewers out there who are not aware, under 200,000 in jobless claims didn't happen one time from 2,000 to basically through COVID. These are exceedingly incredible numbers. And so just when you take a step back from one being bullish or bearish, the back draw. is positive. Now, the valuation argument is something we can have. You look at Sandisk and some of the movies in those names, obviously South Korea, but the fundamental backdrop is still very positive. And those, there are always going to be idiosyncratic valuation issues within any bull market. But one of the overwhelming, I think, characteristics of this particular bull market is the ability of this stock market to correct itself, to rid itself of

excesses that feel uncomfortable at the time, but don't upend the story. We witnessed that a week or so ago. We had the largest crash in momentum than we probably, and the fastest one that we probably have ever had. And then if you pile on top of that, a blow up in a hedge fund that's heavily levered to the AI trade, and yet the market was up three or four days consecutively following that, and we find ourselves, you know, closing at record highs, you know, today, obviously notwithstanding. Yeah, there's a market structure conversation to have in here about the way the market acts and performs these days. But I think your point's exactly right. I would have been and was one of those people who would have told you six months a year ago, whatever, well, if the Mag 7 or Sandisk and AMD drop 20, 30, 40%, 40%, the broader market's going to be down at least 5 to 7%, if not 10 to 15%.

And that didn't happen. The rest of the market, for lack of a better word, picked up the slack. I find that in advance of it, shocking, in retrospect, very thankful because you have a lot. have the market at a high, four sectors are outperforming, a fifth is basically in line, half the index is doing better than the index. You can't really do too much better than that. It's pretty good. Some are wondering whether people are too giddy. I mean, the nuance in your bullishness, it has been and it remains to be that you still think we're going to have a sizable correction in the market before we have a pickup. I was going to ask you before I read the

notes that you gave our producers whether you thought that already happened. And it In fact, you don't think it happened already. No, I don't. I think we've had a rolling bear market in a lot of groups, Mag 7 and software, crypto, and now the AI stocks. But we haven't had a broad derisking. I think that is later this year. And it probably is around this inflation derangement syndrome that is the market is very concerned about, you know, whether the Fed should be hiking in September. I think there's a real battle until September.

But our take, of course, is that inflation is much weaker. I think that there won't be a hike in September. Well, I mean, if the market comes around to that view, then why would you have a 10% pullback? You think the market's just going to get so crazy with itself that it's going to convince itself that there's a hike coming in September? Even, by the way, amid reports in some publications that Chair Worse is ready to do that if he has to, if inflation remains hot into that meeting. Yeah, I think it's still hotly debated because there are economists who want the Fed to hike. just to reestablish credibility with financial markets. We know the media and investors are impatient with inflation because it's at 2-6.

They want it down to 2. But at the end of the day, if underlying inflation is much weaker, which is our take, then I think it's a mistake for the Fed to hike. But this is not a consensus view. I think it's still a battle around. How about that nuance of Tom's outlook? The fact that, you know, everything's great. You pointed out so many of the reasons why so many are now bullish.

But this is lurking. And it's going to be, you know, Jackson Hole. later this month, then this Fed meeting in September, which is going to be one of the real wildcards in this whole story. So with respect to the worst statement about, well, if inflation keeps going up, then I'm going to, that's the most banal down the middle statement a Fed chair can make. If inflation is exceedingly high relative to our target, then we're going to have to hike rates. So I'm fine with that statement. Generally speaking, I'm with Tom. I don't think inflation is quite as bad as the headline number suggests for a whole number of reasons that we're not going to get

into now. I disagree that they shouldn't. I think the 50-50 is right. We have a jobs report. We have some inflation readings. Those reports are going to carry even more significance than normal in terms of what the Fed. What are you saying, 50-50 at the height? Yeah, I think the market is price.

I think it's 50-50. I think it should be 50-50. I think it's, I could make the case that they should. I should make the case that they can. Just keep mind at this September meeting, it won't be 50-50s. It's binary. It's why it's a battleground September meeting. In the sense that if they don't hike, then the market might even fight that and trigger volatility.

I will tell you, I mean, I would push back on that, I guess, in the sense that it could still be 50-50 because for the first time in a long time, we're not going to get the handholding from the Fed that so many have become used to, which is why no matter what happened in the prior meeting, it could be deemed a surprise relative to what the market was already, you know, had convinced itself. was even possible. So things are a little bit different as that goes. I think it sort of ties into our view that the market's still in the process of testing the new Fed, Kevin Warsh, because he is trying to rethink communications, forward guidance, and even what inflation is. Is that what the 30 years sticking at 521, 520? There it is 521 today. Yeah, because it may be reflecting the uncertainty that is created by lack of forward guidance and lack of Fed comms, or it could be the idea that we are, it's inflationary. We actually don't really know what's being priced into the market. And if I can pivot off that for a second on

the credibility conversation, there's a number of, I disagree that the Fed is losing credibility. I don't buy that argument. I'm not alone. I know Torson Slocke recently put out something along those lines. Robin Brooks, formerly of Goldman Sachs on Twitter made a similar argument. We're not alone. There's a transition going on here. It's sort of, the analogy I've been using, is akin to letting your child cry it out when they're younger and have to go to sleep. The child is used to you coming in every day and patting you on the head and putting you to bed. And now all of a sudden, daddy doesn't show up and the baby's screaming. And to some degree, the market is the screaming.

I don't know that this is totally correct, but we'll go with it. The market is the screaming baby right now figuring out what is the new normal in this era. And I think 50-50 in that type of environment where the Fed is not holding your hand for better or worse is the correct probabilistic outcome in front of a jobs report and a couple of inflation reports. My point is the markets, to what you guys were just alluding to as well, the market's not used to going into meetings 50-50. Sure. It usually knows.

Well, it should probably get used to it. It should probably get used to it because according to the article today, it's here to stay. And again, that's his prerogative. We can debate whether that's the correct course or the incorrect course. Obviously, any number of people have come on air. Oh, yeah, they sure have. It's the incorrect course. I mean, there's, you know, obviously a huge debate.

about that, but the mechanisms of that are certainly different to what the conversation relative to, you know, what the markets are going to do. Sure. Between now and then is going to be the broadening story. If earnings are broadening so much, like Waldron was talking about yesterday morning, then theoretically the market should continue to broaden as well. Right? Correct.

If you exclude the second quarter earnings are up 50% year over year. Excluding investment gains, it's still up 22%. that's a huge step-up in organic growth for the S&P 500, which was running at 13% last year. And it is broad-based. And I think the good news is that some of these are being reported at a time when there were energy inflation pressures and tariff headwind. So I actually think the repeatability is the good story because next year, those anniversary. Last point. Four stocks, four sectors are up more than the index.

A fifth is basically tied. Mid-caps at a high. small caps, at a high, the UK at a high, Germany and France, at a high, Brazil and Mexico, almost at highs. There's lots of evidence that this is not just some Fed or NEI-infused rally, specifically in the United States. There's lots of things going well, and again, getting back to the original point to tie it up, every company in every industry is basically saying, we're good, good. All right, more conversations to come. We know that, guys, thanks.

Appreciate you being here, too. SpaceX shares, they're hired today. The lockup expirations now begin in what has been a very big week from earnings to this news. Today, our Morgan Brennan, following all of that, joins us now as you see. Hi. Hey, that's right, Scott. It has been a big week. It's been a long week so far, too. So happy Friday Eve. On Wednesday post-earnings analysts that J.P. Morgan wrote, quote, there has already been significant pre-positioning ahead of this first expiration, the largest of many over the next several months. Maybe. As you mentioned, shares are up. They're up about 2.6 percent right now. But this is just the Start. Available share account surged more than 140% today, representing 20% of insider shares,

but billions more will unlock across multiple tranches into 2027. Bernstein says by January, 50% of shares outstanding will be in free float. The first expirations pertain to some investors and some employees, senior executives are subject to longer lockups and then Elon Musk, who owns about 42% overall of SpaceX, can't sell until next June, if he ever does. If history repeats. Keep in mind because some indexes change methodologies ahead of the SpaceX IPO to enable faster inclusion, a bigger float will mean a bigger weighting, which could mean more buying by funds, and that could be true for the NASDAQ 100, which adjusts quarterly. But Ben Emmons calls this a private, quote, mini IPO, and he notes most of the 911 million shares that are unlocked

today were granted or purchased when SpaceX was valued between 20 and 150 billion. dollars. Where is it now? About one and a half trillion market cap. So an historic big unlock that has enticed a big short with over 30 percent short interest in the stock ahead of this lockup expiration today. We'll see how it all plays out. But right now, it would seem perhaps maybe, Scott, we've got some short covering. Yeah, for now. And your point is well taken. I mean, there's so much more to come that it's hard to make a really firm judgment at this point, which means we'll talk to you many times in the weeks ahead. Morgan, thanks so much. That's Morgan Brennan. Now let's bring in Yorkville's Dan Ives. He's with us here. So are you thinking that at minimum,

there's just going to be a surge in volatility around this name because of the surge in supply that's going to continue to come on the market? Yeah, no doubt. And I think also the index component, as Morgan talked about, you know, just relative to what we see from a short perspective, look, I think the reality is that this is just the first one of these. I mean, when you think about Anthropic, Open AI, and others, it's really looking and sort of case study, how this all plays out. I think the issue for investors, it's almost a tug of war, because to some extent there's the longer-term view, near-term the lock-up, that's sort of the albatross around the stock. Can we, following the earnings, can we move away from the conversation about we're unsure what this

company truly is or who they really want to be? If you look at the amount of money that they're they've already spent. And then the money, there's the CAPEX right there. We just had it up on the screen more than $18 billion in the current quarter. And what we think they're going to continue to spend, this is a hyperscaler, isn't it? Oh, I mean, I don't think there's any doubt. That's what they want to be. And to some extent, when you look at what they're building, the CAPX arms race that

you see playing out is how do you catch up to Anthropic? How do you catch up to Open AI? Look what's happening across big. tech. I need issue for investors, and we've talked about it on the hyperscalor side as well, is you're focused on the longer term, but in the near term, patience is required. And I think for any of these companies, that continues to sort of be that quagmire. But the longer term vision, that's what they have to build toward. And are you telling investors today to buy it now with the belief that they can be that? They can be an open AI. They can be an anthropic. And maybe an

Elon Musk's mind, they can be bigger and better than they are. I think for investors, anyone in space, like you're betting on Musk. You're betting on the longer-term vision. Now, when it comes to where you see in terms of the lockup, that's something that that's just a pure reality, that you cannot sort of talk that away. I think it's really, this is almost becoming a case study, because investors want to see not just how this navigates the next few weeks, but over the coming months. because when you think about what's behind it,

and when you think about the Fourth Industrial Revolution, this is really, you know, I think a good example of companies where they want to spend the lock up and then putting numbers up. They're not going to put up numbers that in any way would take away some of the questions that they have to execute over the long term. Is a Tesla combination inevitable at this point of a big teaser for what's down the line?

We've said I mean, I think there's over an 80% chance that SpaceX ultimately, acquires test. And in my view, when you think about broader AI and broader, from a data perspective, I think that was always sort of the golden vision from Musk. Now, rubber meets the road. Will investors, you know, what will they ultimately say there as that all plays out? But I think this is the theme that we're going to see play out across tech. Because when you think about the hypers and what they're paying and the amount of capbacks and what we've seen across earnings season, monetization now is starting to happen. What that means is shocking. But that means is shocking.

clock's on, they know times run out. And if you ultimately take foot off the pedal when it comes to cap backs, you could find yourself way further in line. What about these other levers that they have to pull, you know, Starlink Mobile, for example, which they talked about on the call, you know, some of the traditional wireless providers shuddering a little bit as to what the ambitions could truly be and what the implications might end up being. How do you see that? I think for Verizon, AT&T and T-Mobile and others. I don't, even though it's shot across the bow, they have such entrenched positions when it comes to the U.S. market. But I think it just speaks to, you are going to see a convergence of spaces. In other words, like, we're seeing more AI, telcos, the Capax

Miles. This is a Starling story. It's ultimately a satellite story. And I don't think it just comes down to like now it's proving out. But when you're public, every quarter you're judged against it. It's about execution. A trillion in REBS by 2030. Is that realistic? Look, I think it all comes down to the space AI story. Remember, this goes, I think this now takes it to much more. The data story, the AI story, that's ultimately what they need to achieve. And then that's not going to, Rome wasn't built in a day, it's not going to happen overnight, but they need to step by step, execute. And investors need to see the longer term vision. It goes back to if Jensen in In 2022, they didn't see the AI vision. In the Della, 2014, they didn't see the cloud vision.

I think that's sort of the thesis. Appreciate the time, as always, Dan. Thanks. It's Dan Ives here at Post 9. Western Digital and Sandisk. They're both falling today. It's certainly a weight on tech and the NASDAQ. Christina Parts of Neville has been following that all day for us and joins us now with more high. Scott, well, the AI storage trade really hitting a wall today. Start with Western Digital. You can see it's down about 12%. This is a hard drive maker. The quarter beat, but its profit margin guidance came in below. rival Seagate, and that's important. Its shipment growth also slowed, and that was enough to knock the stock down. Sandisk is a flash memory maker, so put it into the Nan memory category. It had a similar problem, so it wrecker revenue, but a guide just for roughly flat margins and only modest price hikes when investors really wanted a knockout. That seems to be the theme

across the board. Expectations are so high. Sandus did say it had more visibility with customer contracts though. Still, some analysts think Sandusk is lowballing and its investor day next week could reset sentiment. This isn't, though, just about two stocks. These are momentum names. So when they break, they tend to drag the, for example, the momentum ETF down with them. Micron was lower, did bounce back, but just barely in the green right now. And speaking of bouncing back, the money coming out of memory may be flowing straight into Nvidia up roughly, what, 13% just in the past week or so. So we're seeing a little bit of that. that rotation out of momentum.

Had a nice, like, five-day run, I think, for Invidia. So thank you very much for that. That's Christina Parts of Nevelow. Software stocks, they're also losing some ground today after a wave of weak earnings results. Simomodi tracking those moves for us and joins us now. What do you see? Scott, Datadog was a big surprise.

It's been seen as a leader in the data infrastructure space. Earnings beat, but focus on the earnings call quickly turned to a reduction in usage by its biggest customer, OpenAI. Now, to reassure investors, executives shared that A renewal agreement with Open AI had been signed, but remained sort of unclear whether it was in the same ballpark as its prior agreement. Investors sort of using it as a reason to sell after what has been an impressive run for a data dog shares this year. Elsewhere, software companies HubSpot and Figma cutting their revenue outlook, amplifying those AI displacement concerns, stocks are responding down double-digit percentage points at this hour,

and App Loven delivering weaker sales growth that analysts had anticipated this as its direct competitor, Unity, software really killed it on earnings thanks to a big jump and subscriber go. That stock actually higher by 17 percent right now, Scott. All right, Seema, thank you very much for that. That's Sima Modi shares of Honeywell Aerospace getting crushed today. Let's get to Phil a beau who has more on this big move. What's happening here, Phil? Scott, you want to see an ugly chart? Take a look at Honeywell Aerospace today. A company reported its results for the second quarter after the bell yesterday. And boy, did they have some bad guidance? And that guidance is the reason why the stock is down more than 23 percent. So,

today. They essentially have cut their full year adjusted earnings guidance by 6%. This caught analysts. It caught the media. It caught everyone by surprise. Sheila Cayula and Jeffrey said it best in a note where she said, bra, a guidance cut out of the gate. 26 sales guidance cut to plus 4 to 5 percent. Organic from originally up 7 to 9 percent, adjusted EBIT being cut down by 6 percent. Jim Courier, the CEO of Honeywell Aerospace. says that there are supply chain issues that will be weighing on full year results. The interesting thing is you take a look at this stock since the spinoff at the end of June. Jim Courier has been on our air three times, and we reached out to him again today to say,

what's changed? But he's been on our air three times, Scott, since June 11th, when they had their investor day pre-spin-off. Not once did he ever hint at major storm clouds like cutting the guidance by this much. Yeah, there have been some supplier issues. This has certainly caught investors and analysts by surprise, to say the least. Yeah, in which they never like. And your point you're very well made. Phil, thanks, Phil Lebo.

A pair of food stocks meantime getting slammed today. Brandon Gomez joins us now with more on those. What do you see on your beat? Hey there, Scott. Yeah, Papa John's cratering after the pizza chain cut its full year outlook, suspended its quarterly dividend, and said its turnaround is taking longer than earlier expected. North American same store sales fell more than 8% in the quarter on soft demand and intense discounting. Revenue decline nearly 9% and management expects sales to keep

weakening. Now, the company's CEO saying it is no longer pursuing a sale, focusing instead on its turnaround strategy. Now let's stick with the restaurant sector, Shikshack, giving back some of yesterday's gains after reports that Starboard value had taken a stake in the company. MZUho today raised its price target to $90 from 80, saying Jeff Smith's involvement could unlock additional value by slowing company-owned unit growth, expanding domestic franchising and finding some cost savings as well. Josh Brown, earlier with you, I heard say it's too small, a market cap for the size of Shake Shack's global brand, but there need to be operational changes, something Starboard has executed elsewhere, and we'll see if they can do again here. Good stuff. Yes, we will. Brandon Gomez, thank you. We're just getting started. Right here post nine on closing bell. Coming up next, gaming out the Fed's next move. We've got a key jobs report, as you know, on deck tomorrow. A critical inflation print is looming next week.

We'll break it all down and what it means for the Fed and your money with Ellis. Ellen Zentner. She is joining us next. We're live at the New York Stock Exchange. You're watching closing bell on CNBC. All right, we're back on the bell to hike or not to hike. That is the question facing a more divided Federal Reserve. Here with Moore is Ellen Zentner, Morgan Stanley Wealth Management, Chief Economist, Chief Economic Strategist. I knew I was going to mess this title up because it's just long. It's a long title. It's a really long title. You can skip the rest of it. Welcome back. Thank you for taking me off the hook. The question, I mean, are they going to hike this year?

No. That's a firm belief of our economists at the firm. And, of course, that's tied to getting inflation right, because inflation is all that matters. And so that puts a big if around it. But I don't think Chair Warsh wants to hike. I think there are still more, obviously, on the committee than not, that don't want to hike, or at least not want to hike yet

and can wait for more data. But we were pretty confident that the inflation data doesn't move in a straight line, but continues to show a trend of softening at least. So we're coming down off those very lofty heights. And I think ideally for the chair, you would rather not be forced into hiking this year, wait for the task force on the balance sheet to come back and devise a plan of how you can tighten financial conditions through the balance sheet as opposed to having to do it through rates. I mean, and frankly, through their own language.

You know, when the chair in the latest news conference, and this is what, led to some people suggesting, well, now there's a credibility problem because you can't come out and say, inflation's above target, we're resolute in getting it down. And then everybody's like, well, then do something about it. And then they didn't do anything about it. To your point, if he doesn't want to hike rates, he hopes he can talk rates to where they need to go, at least talk tough. And the markets will take care of themselves. Yeah, so I think I'd put a little more nuance around it. So I think what the markets had a real issue with was that we went into the meeting having a softer inflation print. I mean, one that came in well below expectations even.

And so it would have been good to get some sort of communication around how that was taken into a consideration in the reason for not hiking. And this is something that the press had really pressed him on in the presser. Sorry, that was unplanned. But it was too good to pass up. And so they pressed him on that to say, is that part of your reaction function? Is that part of the framework? And they didn't get clarity on that. So rather than, I think, I don't think he's been in the seat long enough to say you don't have credibility on inflation fighting.

I just think that there's a lack of forward guidance, and that's fine, but it's the lack of communication around what is your framework, what is your new reaction function. And that's why we see, not the only reason, but that's why we're. We see more risk premium priced in to the long end. The point here, ultimately, is that the markets and market participants and people who have, you know, jobs like you have, you're not going to get nearly as much telegraphing or handholding or anything. The market's going to be a little bit on its own. You're going to have to make your own judgments rather than everybody thinking that they have the best idea because they were all but told how to think about what's going to happen.

How are you thinking about that change in communication? Yep. So that's the data dependent. And so the data dependent, look, you see the data coming in, the market, you see the data, and you're reacting to that, and you are tightening financial conditions. And that's when you reference, well, financial conditions of tighten leading up to the meeting. So you're doing the job for us. And we're going to let you do the job of loosening and tightening financial conditions.

I still think what's missing is just that framework. The other problem is that that is something that is not new to Chair Warsh. Powell, Yellen, Bernanke, they all paid attention to financial conditions and how much tightening or loosening the market was doing for it. The problem is that you do need to eventually deliver. That is the problem. So if the market is begging for hikes and believes the evidence suggests you should hike, there's only so long that you're going to be able to hold off before hiking because the

market will start unwinding all of that, and then you're back into the possibility that you're juicing an economy that's overheating. How are you thinking about the jobs report tomorrow? I think the jobs report is going to be fine. You know, fine. 50,000, it doesn't matter. It's enough to keep the unemployment rate steady. Not overwhelming, though. I mean, another reason, I guess, why you would say that, well, why, how could they hike rates in what is, you know, not a weak labor market, but certainly not an intensely strong one. Yeah, but you've got an economy that just printed a near 10% nominal growth rate annualized on private, final domestic demand.

That's huge. And you've got inflation that is well above goal. Can't ignore that. But the thing on the labor market is that I think, I really do think we can set the labor market aside because we've even concerns about it, because we've even, we've passed the fall from last year where we thought, oh, my God, some real weakness. is coming. Fed cut three times to stabilize that. And you know, you don't really, I think we've, we've had enough evidence now to say, you know what, AI isn't taking all of our jobs over the next 24

hours. And it's certainly not a focus of a lot of my investor meetings anymore. Is AI going to take my job or my kid's job? Will they have a job? So I think some of those fears have passed as well. And I think we're in good shape. All right. Well, it's good to talk to you again. Thanks for coming back. Thanks. Ellen Zettner, Morgan Stanley, wealth management, chief economic strategist and global head of thematic and macro investing. You got it. I was going to do it right. We'll talk to you soon. Up next from dunks to deals, we're giving you a court side seat inside Shaq's next big business bet and the empire behind it. Stay with us.

Welcome back to closing bell. Some big news today regarding the NFL's next TV deal. Our Alex Sherman is here with more. This actually happened on an earnings call today. And I thought it was big news. Me too. I think it's very big news. So the news is that Fox CEO, Lockland Murdoch, said that Fox will not be negotiating with the NFL early before its current deal with the NFL has an opt-out clause at the end of the 2030 season. So the general timeline for negotiations is roughly, let's say, a year before a deal expires. The league is almost certain to use that opt-out clause to get more money from its current media partners. but it was open to starting those negotiations

and potentially even reaching new deals with all of its media partners, including Fox, this year. So the rub would be that Fox would pay more money for the NFL, but that opt-out clause at the end of 2030 would go away. And that contract actually ends at the end of the 233-24 season. So in essence, Fox would pay more now, but they'd have the NFL for longer. And the decision by Lockland Murdoch apparently

is that Fox doesn't want to pay more. more money right now. So they'll take their chances in a few years. Have you surprised? Somewhat. I think the NFL wanted a lot more money. And so it definitely put these media companies in a little bit of a bind where Fox pays something like $2.2 billion per year for the NFL today. If the NFL wanted a billion dollars more, now you're starting to pay more than $3 billion here for the NFL. Murdoch actually said earlier this year that he already was open to the idea of what he called rebalancing the portfolio, which in essence means that Fox would have to not pay for certain sports that they have historically paid for in order to afford

the NFL. So the decision here signals that Fox may have some confidence that they can get a deal done with the NFL. And in the meantime, they don't have to take the billion dollar per year charge. So we'll see. We'll see if they're right. Or they just want more time to figure out what the landscape looks like by the time they actually have to make a critical decision. Good point there, because look, as these media companies keep merging with each other, the amount of buyers actually dwindles, and that may help Fox's case. So we'll see. Okay, your big news of the day is that you talked to a very big man.

Shaquille O'Neal. I did. I talked to Shaq. He has a dunk league called Dunk Man that he is the commissioner of and the co-founder of that is currently airing on TN. It is also sort of a beginning stages of a larger special that we plan on doing on Shaq Inc, which will come out later this year.

We did a similar thing with Steph Curry last year as part of the CNBC Sport Enterprise where we will examine the different businesses of Shaquille O'Neal. I asked Shaq about the dunk contest, and I also asked him about if he feels like younger people understand how dominant he was as a player.

Listen to what he said. Kids like what they like, and they're always going to say, Mike, LeBron, or Kobe, which is fine. Because you know what? Nobody roots for the giant. Right. Nobody roots for Goliath. That's true if big men don't sell. I know. Yeah.

So nobody really roots for us. It doesn't matter that you didn't know who I was. Your mama knows who I was. It's all the matters. I think that's true. You know, I think that people that grew up with Jack know exactly who he is. younger people maybe only know him from his inside the NBA appearances, and the fact that he is this ubiquitous corporate spokesman. So that's what we'll go into a little bit with peace.

I mean, he was the most dominant big man of at least his generation, if not others, and probably could have won even more titles. And then turns out to be obviously one of the most entertaining and knowledgeable people about the game on television, but a super astute businessman, which I know you'll get into deeper in the day. Doc, you're working on. He is the second largest individual shareholder of authentic brands, which I know was contemplating going public. So if they do go public, we will know exactly how much money Shaq has in that company. But it's certainly in the hundreds of millions. And more money. Exactly. All right. Good having you. Alex, thanks. That's Alex Sherman. Up next, one payment, speaking of money, one payment play getting punished, though, today.

We'll give you the what and the why next. I would tend to the bill back to Christina now for the stocks that she's watching. What do you see? Oh, you teased it. Block. Beat and raised its full year outlook, but the Q3 guide just offered little upside. And investors still want to prove cash app can keep growing as its lending products cools. And that's why you're seeing shares down 6%. Peloton sinking more than 16% today, even after turning its first ever annual profit.

The problem isn't the past year. It's what comes next. Paid subscribers fell nearly 9%. And Peloton expects sales to drop a number. another 4% this year as it lapsed last fall's price hikes. So even with Peloton finally making some money, Wall Street is stuck on one question. Can it ever grow again?

Last but not least, Zillow falling even after a second quarter beat. The issue is the outlook. Zillow warned its core home listing business will barely grow next quarter, partially because traffic from Google search has slowed sharply. That's a threat to how Zillow reels customers in. The soft guidance follows 500 plus layoffs as well. Scott. All right. Christina, thanks. Christina Parts de novo. Coming up, two consumer names take center stage in overtime. We'll tell you what to watch for from Airbnb and draftings after the bill. We'll do that and more in the market zone, which is next.

Now the closing bell market zone, James Taylor of the Taylor Group of Wells Fargo advisors here to break down these crucial moments of the trading day. Plus Oliver Renick standing by live from the CBO global markets in Chicago. I mentioned we do have two big earnings reports in overtime tonight. McKenzie Segalov's looking at Airbnb for us. Contessa Brewer has draft kings ahead of that print. But Oliver, we begin with you. Let's play some options action. Tell me more. SpaceX, Scott, it's traded about two and a half times.

It's daily options volume today, and it's a dead heat between bulls and bears on a session where nearly one billion shares hit the market post lockup. But the two biggest money trades we saw were both very bullish and very similarly structured. They were combination trades that involved selling multi-million dollar back. batches of puts and buying calls on top of them. The biggest hit right at the open, a net $7.7 million bet that SpaceX won't be down another 20 percent 10 months from now, with an additional wager via calls that the stock could double by June next year.

Then this afternoon, we saw a very similar approach, but smaller, a trader who sold 3.5 million of the 75 strikes expiring in January and bought 5 million of the 185 strike calls. Scott, its true options flows have been bullish and wrong all the way down, but at least these trades today looked a bit more sophisticated. Okay, good stuff. Oliver, thank you. Oliver Renick. Now to McKenzie Segalos, looking at Airbnb. So, Scott, Airbnb heads into earnings with what Deutsche Bank calls the cleanest setup in online travel with its core business re-accelerating. But much of the lift appears to be coming from travelers

paying more, not necessarily a major surge in the number of trips. The street expects revenue growth of 16 percent, World Cup demand, helped. Bookings in host cities rose 26% according to Oppenheimer, but roughly 85% of that growth came from higher nightly rates rather than additional nights. Now that puts a lot more pressure on the outlook. Airbnb shares are up 11% year-to-date and recently traded near a 52-week high, so investors want evidence that demand can stay strong after the tournament, particularly as Europe and the Middle East soften. Also key is whether Airbnb's latest push beyond home rentals can stick, especially after earlier failed attempts to turn the platform into a place to book services

and experiences. Much of its valuation story now rests on making that reinvention work. Mack, thank you. Kenzie Segalis. Contessa, what about Draft Kings? Draft King Stock Scott has dropped more than 50% over the past year. The pressure is really on the sportsbook here to demonstrate its resilience in the face of this new competition from Kalshi and Polly Market. Draft Kings has its own prediction platform, of course, integrated into its a unified app, encompassing sports betting, eye gaming, or that's online casino games, fantasy and lottery. Now, the street is expecting Draft Kings to report revenues of $1.5 billion this quarter with

earnings per share of two cents adjusted. But while this quarter could get a boost from World Cup, investors are going to focus on how strong sportsbook is moving forward. What's the plan for growth? What's the ramp here for predictions? Draft King's closest competitor, Fandle's been struggling. Flutter shares plummeted after the company reported earnings. yesterday. Draft King shares are up right now, but we will keep an eye on that after the close

and after the report. Contessa, thank you. That's Contessa Brewer. Of course, I mentioned James Taylor sitting next to me here. So we're in the neighborhood or certainly getting there of your year-end target of 7,800 to 8,000. We're going to get there? I think so. Yeah, I think we're definitely going to get there, in my opinion, at least. I know Wells is between 7,800 and 8,000. I'm on the higher end of it. I think we're definitely what takes us there and then beyond? Because as I said, we're, We're kind of on the doorstep, obviously, and there feels like there's enough momentum behind the market to get us there? Yeah, I think their earnings have been unbelievable this quarter.

I mean, you're seeing 80% of the companies outperform the consensus. And if interest rates stay steady here, I think we're going to be a really good shape. Okay, how about that issue? Because, you know, we periodically during the program today have put up the 30 year. Obviously, you know, the market picture, the yields rose a little bit after the last Fed meeting and the newser. We're at 521 now. Do you anticipate them staying here if they continue to back up a little bit? Is that a problem for the stock market?

I don't think so. I think it's actually really interesting. You're finally getting paid to hold Treasury and fixed income. So we're talking to our conservative clients or moderate conservative clients at looking at fixed income at this point, which has been a long time bump. If the market's going to get to the 8,000 level and then be able to exceed that, what's going to get us there? Is it going to be a tech-driven story?

Is it going to be the broadening story? continues to develop because as you answered the very first question, we talked about earnings. As we know, earnings are broadening. That's got to be good for the overall broadening story, right? I think it's been great. I think it's honestly, we're not relying on seven names anymore in the tech space. The breadth of the earnings is really the story right now. I mean, the fact that you're getting 80% of the companies outperforming their consensus, I think it's huge. So we haven't had that in a long time, I think since 2021. So I think the earning story is a really good one going into the end of the year. Seems to be a lot of momentum behind the financials trade. You like it,

it sounds like, as much as anybody else. Is that right? Yeah, Wells Fargo Institute is overweight on financials as well as technology. I think both look really great right now, and I think that health care trade is looking pretty good, too. And that's my opinion. What don't you like? Right now, I hope we figure out things with Iran. I think, you know, energy's been going through the roof. I hope energy prices do come down. And yeah, that's not really, you know, space that I'm You're not a fan of that sector? Not right now. Because you think oil prices are going to go down?

And it's going to drag, I mean, because the performance has obviously been great. It's been great. It's been great. It's been absolutely fantastic. One of the best performance sectors here to date. We're taking gains off the table there and rotating some of these other names that have gotten being up low. All right. Good stuff.

James. Thanks for being here. Of course. Thank you. Right here. Okay. The bell's going to ring. And, yeah, we're taking some gains off the table today.

Obviously, because the market should be read across the board. We've got those earnings coming in overtime. I'll see you tomorrow. into a