Closing Bell - Closing Bell 9/2/26

Episode Date: September 2, 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, guys, thanks so much. Welcome to closing bell. I'm Scott Wapner, live from Post 9 here at the New York Stock Exchange. This maker breakout begins with the markets, of course, and whether calls to get more cautious right now are justified or not. We'll debate that, and we'll ask our experts what they think coming up. In the meantime, let me show you the scorecard here with 60 to go in regulation. We're green, as you can see across the board, Russell's doing the best.

And that's despite the fact that bond yields do remain elevated, the 10-year yield today hitting its highest level in almost three years. watching that. It's right on the flat line, just about 480. So that's certainly being closely watched. How about Nvidia's move today? Nice boost there, meta as well. And we do have some key earnings looming for the tech space as well, both Broadcom and Snowflake reporting in OT. We're going to get you set up for those in just a bit as well. Elsewhere, a big day for Dell after its earnings report, but a rough one for Palo Alto, even after its strong earnings, that stock did run a lot into the print. Take that into consideration. But that's a lot.

That's the worst day in a while for Palo Alto networks. It does take us to our talk of the tape, history, yields, war, oil, all on the market's mind these days. For more on where we might be heading from here, let's bring in our panel. Trivary, it's Adam Parker, High Tower, Stephanie Link, both CNBC contributors. We're happy about that, and we're happy to have both you here. Good to be here. All right, Steph, so I said, right, we do have all those things on our mind. Yields, war, oil, calendar, supposed to be bad.

How do you see this market here? Well, I was really encouraged by the New York Fed President Williams today in his comments. They were really dovish, actually. And he is a dove, I know. But I agreed with a lot of the things that he said. So it keeps me constructive. Basically, he said yields are high because growth is better. And, you know, I've been arguing that point for a long time.

Talked about how there's some progress being made in inflation. And a lot of the inflation is tariff and oil related in other areas. They're seeing progress. So that was encouraging. He was kind of like hold. He was on the hold side, no hike side. So he's deemed as like more of a centrist in the current time where the Fed has gotten more hawkish. And he also talked about productivity, Scott, which we're just beginning to see that increase.

And so I think you add all that up. I feel pretty good about where we are. I know that September is a really challenging month. And I've said it before. Into the volatility, I want to be adding to. And you know, I have been adding to names all summer long. Part tech, part the AI food chain, natural gas. EQT is my newest position that I bought a couple of weeks ago we talked about. And then I look at

the Atlanta Fed Tracker and I know it's not the actual number that we care about, but it's actually accelerating and that's a good thing. 4.8%. We got really good factory orders. We got good ISM manufacturing numbers. So I feel okay. I think you want to embrace, if we do get a pullback, and then you want to embrace it and be buying. What about all these, what feels like a growing chorus of caution. And you hear it from very well-respected people that the risk reward in the market has changed as you head into this rocky traditionally month. I mean, how do you assess it knowing that people are growing more cautious? And we asked at the top whether it's justified to be so or not. I don't think it's justified. I think September's had some rocky months in history,

but a lot of it was because it used to be the estimates were always too high. And so what people happened is people would go away, come back after Labor Day, go to the big tech conference at City, go to Morgan Stanley Industrials and be like, wow, the numbers are too high, I got to cut my numbers. I don't think that's the case this year. I think all year long, actually for really two or three years, the numbers have been too low. We've kind of consistently seen numbers come up. So I don't expect us to have a September where corporates are saying things are really materially slowing. And I think when you kind of get the news that earnings are going to grow close to 20% this year, probably

you know, sorry, next year, well above 20 this year and probably beyond, I think there's probably risk to the upside to 28 numbers. So I think the fundamentals are pretty good. And so I don't expect this to have a rocky September based on estimates, you know, a gross scare on estimates.

So you always talk when you come here about the people that you speak with. Yeah. You know, whether it's at dinners, at a round table, and you've got some hedge fund managers and pretty big money managers around. And you sort of get an idea on where the general thought on the market is right now? Do they share your view? Definitely a couple people were more cautious last week when I was on the road. Look, I think the

bare case around AI, the part that is still unknown, I got to admit I changed my mind on a little bit is like what's going to happen to white collar unemployment in that like 100K to 500K range? And there is a real chance that we have a problem that gets, you know, high singles, maybe even low double-digit unemployment if it really does take off without the gout. being filled in. I'm a little bit more bullish than that, that physical AI is going to come at a time and absorb some of those jobs. So for the next couple of years in the game of chicken, I think we just have so much more growth before I have to worry about that, that I don't want to sell into what's going to be very strong earnings. Even if I embed a lot of multiple contraction,

I still can make stocks work. I mean, Micron's a good example. They report later this month. I know you're focused on Broadcom here in the short term, but like, you know, Jensen told you the numbers are too low at Micron. It's pretty pretty much told you. Right, right. So if the biggest issue in the whole market right now, and Steph knows as well, I just don't want to own stuff that misses because a penalty's been so harsh if they miss. It's not just been earnings, though. It's been revenues are growing double digits. It's margins also that are expanding. Talk about margins going higher. Micron. Those margins are going, you can't keep up with it in terms of the modeling of it. I like the AI food chain a lot here. I think this pause in the last few months

isn't because we topped out and it's over. It's because we're going to end up way higher before the end of the cycle. So I think the risk awards pretty skewed to the positive in the medium to long term on the whole AI food chain. The data center debate, Steph, we've talked about it every day because everybody's talking about it every day too. From politicians to leaders within the AI space, it's probably led to some of the weakness that we've seen in the stocks of late. How do we deal with that right now? Well, I think that the whole issue is overdone, overblown. I mean, I think that we are going to see building out of data centers.

I think the states that are actually allowing it are going to get more and more of the business, the more pushback that you get from other states. But I come back to the federal government. It's very supportive of AI and the whole food chain. And we talked about this the other day on halftime that NVIDIA went from 45% revenue growth to 70% revenue growth, forecasting, guiding by 2028. They obviously see the demand. And you can talk to any of the hypers. You can talk to any of the industrial manufacturers. I mean, I went back and looked at all the backlogs of all the industrial companies that benefit from the food chain. And you're talking

about 30, 40, 50 percent backlog growth. Sure, that could get canceled. But some of these are take or pay contracts. And so that's, to me, the long story. So I think that the fact that we have this pushback, it leads to a longer cycle. And I think this is a decade or two decades long theme. And I think that the pushback only makes me more confident in that thinking. Do you think the pushback has had an impact on these stocks? I think I agree exactly what stuff said. I think the pushback has that an impact. I just think it's mostly stupid and baseless. I mean, Google it. You use about the same amount of water for a data center as two golf courses. Are we going to cancel all the golf courses to save data

centers? Do you think it's political? Do you think it's informed? No. And that's, by the way, bipartisan, that's a, that's happening. I'm equally critical of both parties when I say that. Noise abatement, it's pretty easy to get around. Like, if you look at the criticisms from the 23 or whatever states it is, there don't make any sense. Do you want revenue and jobs and tax? Yeah, you should. So this is just, I think, a temporary kind of misunderstanding that will sort itself out as, you know, important people communicate what's really at stake here. But the very top of the program, you talked about the prospects of significant white-collar job loss. But I'm talking about years.

I understand that. Yeah. But you don't think that the prospects of and fear of that are playing into this, too, that communities are upset because they don't trust AI or what it's going to mean to them beyond the power, water, aesthetic issues that exist. We've got to figure out a way to deal with all of that. It's probably all of the above when you say why is the data center issue there? You check every box, don't you? I don't know. I think we're giving a lot of credit to the average congressperson when we go through

it would be that forward-looking. I'm not even talking about the politicians. I'm talking about the people. I think ultimately the bulk case is that I don't think people even understand what's going to happen with physical AI yet and all the humanoids that are going to be out there, all the robots we're all going to use and have, all the silicon that's going to go in there. I think there's a couple of certainties that you can point to. We're short compute and we're short power.

And the associated stocks over the next five years have come nowhere near peaking. Sure, there'll be growth scare. Sure there'll be policy could screw it up in a three-month trade. But like we're headed way higher in terms of the overall growth rates for those industries. And if you're managing a diversified book, you just have to have exposure to compute and power in order to help perform. It's interesting to say growth scare. Address that because we have we have, we have. I've had growth scares at times, not related to data centers or AI, but it is a fact that every

now and then growth scares creep up. And they do impact the market on a more short-term basis. We just don't really know how much durability this issue is going to have, whether it, you know, simmers down after the midterms, whether it gets louder into 28, whether it's just a constant overhang that the tech industry is going to have to deal with. And in the interim, the stocks are going to remain more volatile. They are going to remain more volatile, but they've all had nice runs. All the food chain sectors that we've talked about, data centers, grid, power, hyperscalers,

they've all had enormous performance, outperformance. And so, sure, you're going to get pullbacks, but I think that's where your opportunities lie, Scott. By the way, people thought that the Internet was going to lead to job losses. And, you know, we had some job losses, but we also had some industries that were created. We had the apps business be created. We had mobile phones be created. So I think that there are parts of the AI food chain and the AI theme. We don't even know what kind of jobs are out there.

And I think people still want to deal with people. Yeah. Let's do this. So let's drill down a little bit. You guys mentioned some of the earnings that are looming. Broadcoms are obviously among them. Christina Parts of Nevelos is going to take a look at Broadcom. Sima Modi is going to join on Snowflake 2.

But let's begin with Christina on Broadcom. Well, Scott, so Broadcom really has one of the best AI chip stories on the street. and it's yet one of the worst performing stocks. shares are up just shy of 7% this year while this semiconductor index has soared nearly 67%. Since its last report in June, Broadcom has actually fallen more than 20%.

But make no mistake about how much this print actually matters, Broadcom has become one of the most impactful earnings on the S&P 500. Its contribution to the indexes' earnings growth now runs even bigger than Apple or JPMorgan. The overhang, though, why we saw the stock drop just over the last few weeks is competition. Google is bringing in cheaper second sources

for its custom chips, media tech on the lower cost design, Marvell, AMD, circling. Broadcom keeps the higher value work, but investors worry its grip might be loosening, which is why the AI number carries so much weight. Broadcom guided AI semiconductor revenue to $16 billion with estimates landing just under that. And the bigger tell is the 2027 forecast stuck at north of $100 billion last quarter. The street wants the CEO to finally raise that number above 100 billion, anywhere to about 115 billion. If it can deliver, either the competition fears fade, hold the line again, and a stock that's lagged all year just pretty much stays stock.

And you can see over the course of the year, it's been up but 24%. Okay. Christina, thank you. We're going to Siemen now with the setup on Stoflake. That's Christina Ports in LOS. Hi, Seema. Hey, Scott. So Snowflakes Report will provide an important window into AI usage.

So think about it like this. Snowflake Warehouses the data used by the large language models. As queries and prompts go up and get more complex, the more the AI labs will lean on data infrastructure operators. The street is convinced that Snowflake benefits from this trend, which shares up about 20% in the last three months, up 40% year-to-date. Compare that to the IGV's outperformance. It's pretty stunning. But investors are debating two key points here. First, the effect of lower token costs, the potential impact on margins, and the threat of competition from Microsoft and Data Bricks, which is rumored to go public soon. The bar is high. Snowflake Pier MongoDB that is seen as the digital filing cabinet for Enterprise

didn't articulate a stronger run rate for its key product Atlas, sending shares down by around 13% at this hour, Scott. So investors fixating on every word from these data infrastructure companies. Yeah, no question. Seema, thanks so much. That's Sima Modi. I feel like now we can have a good conversation about software versus semis. You own both of these names. Snowflake had already kind of emerged from the rubble of what?

what's happened with software, that space has obviously been doing a heck of a lot better lately. You want to just take that one first? The only reason I'm nervous about it is because it's up 47% year to date. Hence coming out of the rubble, right? That's what I mean. It is coming out of the rubble. It is as it should. Last quarter was phenomenal.

I'm not sure they're going to do as well this quarter. At least the expectations are higher, though. That's the whole point. But they're going to do earnings growth and product revenue growth in the 29, 30% range. They're going to see double-digit market. I think 12 and a half percent operating margins. I think those margins can go much higher over time. They have introduced many different products, which gives them a lot of momentum and increasing in market share. So all of it sounds good. The only problem is the stock is price to perfection.

So it's the same thing of Palo Alto today. That thing should not be down 10%. Broadcom's been priced for rejection, not perfection. I mean, when you look at it, it's the worst performer over the last three months of the SMH's top 10 holdings. So you've been a semis over software guy On the conversations that we've had How do you see this? I like it I think the context of like this year it's been bad You gotta remember it was like awesome

The previous couple years So it's always starting point sensitive It went from And also ran semiconductor Five or ten years ago to one of them Max 7 right So it can't be a Mac 7 without it being an awesome stock Some are saying it needs an invidia-like quarter tonight to do anything.

I think at the current moment, and I like it, but I think in the current moment, I think people think if you believe the AI story, Micron was at 1,300. It's now at 9 and change. It's probably more upside to Micron if it's game on. And at the current moment, I think people just felt like Nvidia lag, so they went. Like, it might have just been a trading vehicle between the Trillion Club in semis. I think if you're looking out, they have a pretty darn good position. you know, Hock Tans in with Mata. I don't think this thing is going to be a loser over any meaningful period of time.

That guidance is important, though. That AI guide. That AI guide is 100 billion. There's a whisper number for, this is 2027. There's a whisper number out there at 140 billion. I mean, the consensus is at 118 billion. So, I mean. But I don't think there's as much, I think people know Nvidia and Micron's numbers have to come up.

And maybe it's a little less because of the stock being weak. There's a little less, they're not going to have the Palo Alto issue. Right. And he is very conservative, right? The CEO is very, very conservative. And I expect that to be the case as well. And, yeah, it's up 6% and the socks is up 60. So, like, this is the reverse of Snowflake, to be honest with you, or the reverse of Palo Alto.

Right, that's what I mean. Yeah, yeah, yeah. That's why we did it that way, right? The haves and the have-nots. Yeah. The other issue is momentum, which I want to do before we leave the conversation because Broadcom is a member. of that trade. And it's been horrible.

The biggest quarterly underperformance in 25 years relative to the S&P on a quarterly basis. Goldman's trading desk says their TMT momentum pair, which dates back to April of 11, had its worst month on record in July. The Mizzouho trading desk today says momentum baskets have now completely round-tripped and broken below the July lows around situational awareness.

I mean, that gives you an idea of what's happened with this trade. Is Broadcom critical tonight for the next moves in that trade? I don't think it's like the proxy for momentum. Honestly, I think that was the undwine of Micron and some of the sort of higher beta stuff that went from 350 to 1,300 after the March print into the end of June and unwound to mid-eighths, like as an example. So sure, top-desol momentum, everyone knows that. It rolled over hard in July.

I don't think this is like the microcosm for that. I think everyone knows it's an important business, and I think their AI guidance matters. But like, if you take a step back, you know, we're going to grow. I mean, I think we've talked a lot about the fact that things I used to believe, I don't believe anymore, investing changes. If you just think one thing works, that's never the case. You have to adapt.

You know, the level of growth in earnings and revenues you're going to see from these companies is so high that even if you embed a ton of multiple contraction from here, it's hard to see why Broadcom will be a lot of money. bad stock over a sort of 12 to 24 months. You've had a 20-point multiple contraction in this thing. Right. If you believe 20-28 estimates, right? Which is something like could be 30 to 40 bucks.

But I don't want to get emails at, you know, 6 p.m. about the aftermarket trading. Let's look out, let's look out 6, 12, 18 months and then we'll meet that. Oh, they'll start coming through at like 430. You don't have to wait until 6. Yeah. Criticize my glasses. There'll be a lot of, you know. All right.

We'll leave it there. Guys, thanks. I love that. That was fun. Yeah, you as well. All right, it is a very big week for Apple. John Turnus officially taking the helm there a week away now from the company's most important iPhone event. Mackenzie Segalis has the very latest for us. Hi, Mac. Hey, Scott. So a new SEC filing from Apple helping us read the tea leaves on just how involved Tim Cook will be now that he's handed over the top job. New CEO John Turnus getting a $58 million target pay package for fiscal 2027, including $55 million in stock with 75%.

of that equity tied to Apple's performance versus the S&P 500. Cook, though, he's still getting 47 million as executive chairman, only about 20% less than his successor. That points to a very active role, though in Mega Cap Tech boards may view that kind of comp is relatively modest compared with the founder-level wealth at peer companies. And Ternus gets his first major test just one week from today. Morgan Stanley calls this potentially Apple's most consequential iPhone launch since the iPhone with the widely expected debut of a foldable, what would be its first major form factor change

in nearly a decade. Alongside some very aggressive pricing. The firm expects pro models to rise at least $200 like for like, with increases of as much as $500 at the highest storage tiers. But that same note saying that Apple appears more worried about securing enough components than finding enough buyers with supply chain checks showing some production increases ahead of launch. Scott. there, right, for this big event. And John Turner's first in running this company. So much on the line.

We'll look forward to seeing you out there. Mack, thank you. Mack, thank you. Mackenzie Sagalus. We're just getting started here. Next, booming backlash. The fight over data centers heating up. It could put big tech AI's ambitions to the test.

You got to hear what the Treasury Secretary said. You got to hear what OpenAI Sam Altman said. And then, of course, you need to hear what Flexo Capitals Lotone thinks next. I think that the AI companies, whether it is the builders of the data centers, whether it is the labs themselves, have done a horrendous job, horrendous job of explaining themselves to the American people. And I think we need a big reset on this. They're going to have to take some of the blame. And they are going to have to convince the American people that all the benefits will not accrue to a small group.

Well, that was Treasury Secretary Scott Bessent at the G. 20 as the data center debate continues to escalate. For reaction now, we bring in CNBC contributor Plexo Capitals, Lothoni. It's good to have you back. Welcome. Thanks for having me. What do you make of what he said? Has the industry that you know so well done a horrible job?

Yeah, well, look, the politics are definitely the headline now, but the larger story is still what happens when AI becomes industrial infrastructure. So the first phase that we saw in this race was about models and chips. The next phase is about turning those chips into powered, permitted, and economically productive capacity. So that makes land, transmission, financing, and now community acceptance inputs into the production of intelligence. So the best historical analogy that I can think of is not really any single industry.

AI infrastructure is like a hybrid, utility-like in its dependence on power and cost allocation, railroad-like in its need for land, enormous fixed investment, regional networks, and maybe a little bell system like in the vertical integration of its infrastructure, technology platforms, and customer access. So, you know, I think Secretary Bessent is right that the industry has done a poor job explaining the who benefits, but I will go a little bit further. This isn't simply a PR problem. It's a political economy problem because communities are being asked to absorb

immediate visible costs in exchange for national productivity gains that are refuse uncertain and often captured elsewhere, and the fear is by a small few. That's exactly where I wanted to go, the small few, because it wasn't lost on me the way that Secretary Besson ended his comments, which says to me it speaks to, I think, a bit of the skepticism in the communities of this country of ours who see talk of IPOs and talk of riches by a few well-known people, they're not, of course, thinking about the employees of these companies who are also, you know, going to become wealthy as a result, and just being skeptical of that fact that people are becoming very wealthy while I'm worried about this technology that they're perfecting

and thriving on and becoming rich on is going to cost me my livelihood. Yeah, that's right. And I think what we're really seeing with the backlash, which is the not in my backyard, is really two questions. And your point is, I think, spot on. Because one is, you know, how do we as a society govern this increasingly powerful intelligence and how do we really rationalize the enormous amount of wealth that's going to be created, potentially at the expense of a lot of white-collar jobs? Now, these jobs obviously will not be isolated to certain communities,

But I think what's happened is these communities have figured out a way to potentially, in their minds, slow down or potentially stall the development, right? So that's within their community. But what we're talking about are the trends that they're afraid of that are really global in nature. I wonder also what the pushback means to the buildout itself, whether we've already overcommitted. there was a report today. PWC says data center spending to reach $32 trillion by 2050. Can we listen to what Sam Altman said on a podcast,

of course, OpenAI? I want you to listen to what he said and react to it. I'm not worried about our compute buildout plans. I am worried about the world's compute buildout plans. Like I think we are going to be able to use all of the compute very profitably that we were planning to build. But I am seeing the first signs of what feels to me. me like unsustainable silliness of, you know, random new neocloud popping up, people claiming

that they're going to build gigantic amounts of compute next year that I think they don't have the revenue to support or a buyer. Yeah, I definitely feel like some fear about what the world is doing as a whole, although I think we feel very good about what we've committed to. So I don't want you to address the, I'm worried about everybody else, but we're just great idea that he puts forth. but the idea itself of, quote, unsustainable silliness and whether we have, in fact, entered that realm

and what the ramifications could be. Well, I do think that we're still at the point where there's so much more demand than supply is available. I would even say to the next year or the year after. It reinforces, Sam's comments, kind of reinforce this argument that compute is becoming strategic infrastructure. And so once a company has secured a large amount,

of capacity. Its competitive position is really dependent not only how much computer controls, but who else can obtain a comparable amount of compute and how quickly. And what this really does is, you know, once again, this puts the hypers, the open AIs, and the anthropics of the world in a very enviable position because they've secured so much compute already. And they have the balance sheets to be able to kind of wait out the extent. of that return on their capital investment. But I think those are the key things that I would focus in on. What do you think before I let you go that big tech, whether it's, you know, Sam Altman

and others need to do to stem the tide of what's happening in our country around the data center issue? Do they need to go somehow speak to the communities of America where these data centers are going to be? How do they turn what feels like? it's an only growing and more dangerous tide for what this industry feels like it wants to do. Yes. I mean, look, if a company asks a community to host the infrastructure required to produce intelligence, then it's got to demonstrate how that community participates in the upside.

It can't promise trillions of dollars of productivity somewhere in the economy while asking the local residents to absorb the power requirements, the transmission lines, water use, noise and construction. Now, some of this is, you know, kind of painted not in the way that it actually is water use, noise, but we need better. Politicians would never do that, low, would they? Come on now. So we just need better communications, but that alone's not going to repair it. The community needs to understand the economics and how they're going to become part of those economics. who's going to pay for the grid, the upgrades, what happens if the tenants leave,

what jobs are going to remain after construction, and what durable benefit the community receives. So, you know, we spent all this money on securing GPUs, land, and power. Now we need to recognize that community acceptance is another scarce input into the production of intelligence. And maybe a highly underestimated one, too. Lowe, thank you very much for the conversation. I appreciate it. We'll see where it goes from here, and I know we'll speak on it again. low Tony. Straight ahead, following the money on the hottest asset class around. It is sports.

We'll talk about what's driving all the recent dealmaking. Why now are Alex Sherman and Sports Court founder and CEO Mark Gannis. They join us next to break it all down. We're back. The hottest asset class around. It is sports. As a flurry of deals are announced over the past several weeks. For more, we're joined by CNBC sports reporter Alex Sherman. It's good to have you on. I feel like you're on all the time because we're talking about this all the time. Yeah, I think what you're about to see was triggered by a conversation we had yesterday, Scott, which is like every week we're on talking about a new team being sold, it seems, at least recently. Well, we figured let's lay it all out for you.

Here are the team sales in 2026 either announced or completed. So just in the past month, we have had three. And these are U.S. teams controlling stakes, meaning it is a majority owner that is selling. Look at the Lakers for $12.5 billion there. The Timberwolves at $4.5 billion. And the Angels, that was the deal that we just announced yesterday at $4 billion. Now, some of those numbers are a little bit fuzzy, like the Angels deal includes the Regional Sports Network. The Timberwolves deal includes the Minnesota Links, the WNBA team.

Some of these deals include the stadium and certain land, others just the team. But you can just take a look at those numbers. 12.5 billion, 9.9.6 billion for the Seahawks. That deal was announced in July, a slew of deals in that kind of $4 billion range. You know, you think back to, let's say, 2014. That was when the Los Angeles Clippers were bought by Steve Balmer. That deal was $2.1 billion. And at the time, everyone in the world of sports media could not believe the price tag of that deal.

$2 billion for an NBA team. And now you take a look at the Lakers at $12.5 billion valuation. Quite a bit has changed in recent years. years in terms of the value of these U.S. professional sports franchises. And one of the questions is why. And when I ask you that question, literally a story just crossed a few moments ago. I don't even know if you had a chance to see it, but it plays into what I'm going to ask you and what we're going to talk about. Reuters is reporting that Carlisle, Bain, and Oak Tree are among private equity funds preparing bids for a minority

stake in Syria A. That's the Italian top soccer league. Their international media, they're international rights business. I bring that up because I'm wondering, and I'd love your take, as to whether private equity's presence in a much larger way in sports has changed the game, no pun intended. It has probably pushed up valuations in the NFL. It has probably, and this is yet another example of it, may push up valuations in media rights, depending on what league you're talking about. But this, to me, feels like a moment that needs to be marked when private equity decided it wanted a bigger presence in this asset class we call sports. Yeah, to some degree, this is a little bit of a chicken and egg thing where it's like, well,

maybe the media rights drove the valuations higher. And then at that point, it was harder for individuals to buy into teams because there were just fewer and fewer people that had the money. So then the leagues needed to try to come up with outside investors and different sources of capital. So they allowed in the private equity investors. You could say it's that narrative, or you could say it's the other. narrative, which is that the private equity influx has juiced up the prices, particularly in these minority stakes, because remember, private equity firms are not allowed to buy majority stakes in any of the four major leagues. And those minority stakes, that 10%, 20%, 30%, whatever it may be,

stake in these teams, that has been sort of the catalyst that has really jacked up the valuations across the board. So either one of those narratives, they both involve private equity. So I think it's safe to say that the involvement of private equity one way or another has been a major factor into why we're seeing such high valuations. I love that we're talking about this as much as we are. It's so interesting. Alex, thank you very much. Alex Sherman, joining us once again for more on why now and what it all means. We're joined by Mark Gannis. He is SportsCorp founder and CEO. Of course, we need to speak with you because you're the epicenter of all this all the time. If I ask you, why now? Why does it feel like we're talking about this every week?

It's because we have not just private equity coming in, but we have some very wealthy people who've been created in our country, multibillionaires from things like the SpaceX company going public, what the stock market is doing generally. And they want to get into sports. And so whether they're coming in as a minority owner or a control owner, look at the NFL deal for the Seattle Seahawks. That's the Kostla family.

venture capital primarily within tech. These tech parties that are coming in now are becoming major players in the sports industry, and they have a lot of capital sitting on the side. What role do you think private equity has played as it relates to the NFL, which probably the business that you're closest to that you know the best and the number of deals both in franchise and stadiums that you've been involved with over the years? What role has that played, do you think? it's played a role, but it hasn't been as dominant role as it's played, say, in the NBA.

The reason for that, and the reason for that is only 10% is allowed for private equity firm in a team, or in private equity in a team. But even more importantly, look at the number of wealthy families and individuals that have come in as limited partners in the NFL. It's at least a three-to-one ratio versus private equity, whereas in the NBA, you have more private coming in and less individuals and families. In the NFL, you have more individuals and families and less private equity. I'm wondering if what we're seeing with the valuations of these franchises, I mean, from the Seahawks to the Lakers and now the Angels, right, talked about with Stan Kronki,

whether it's happened at the expense of smaller leagues, if you have all of this money going towards the big leagues and the valuations increasing by such a large, to the biggest leagues. What does that mean for the smaller leagues that are out there? Believe it or not, they're booming also. You look at the evaluations for the WNBA, the National Women's Soccer League. Look at all the new leagues that are being created, from flag football to TGL golf, to the X games now being privately owned as well. What you're seeing is that what we see in the sports industry, which is we see a very large. horizon for increasing the business of owning of sports generally. AI, where it may disrupt a lot of other industries in the sports industry,

it's only going to make sports bigger and better, globalize it and personalize it. And then you add the other really macro trend going on here, which is the experiential economy. People spending a lot of money to experience things liven for themselves. that's sports, that's concerts, that's tourism. Sports benefits from every one of these macro trends. Great insight, as always. Mark, thanks. We'll talk to you soon, Mark Gannis. Up next, Wall Street, raising a glass to one booze stock today.

We'll drink to it next. Welcome back, Brown Foreman rallying today. Let's get to Brandon Gomez with more on that move. What's going on? Hey there, Scott. Yeah, shares up 4%. Despite the Jack Daniels maker narrowly missing revenue expectations. Now, sales did fall one.

to $911 million. So what's lifting the stock? Well, analysts highlighting in part profitability and free cash flow improvement, jumping to $161 million, helped by lower capital spending. Now, some bright spots, too, for the company, ready to drink canned sales rose 11%. And Brown Foreman held its full year outlook, despite calling the macro environment challenging, for any number of reasons we've talked about here on air already. Now, the hangover remains elsewhere.

Whiskey was flat for the quarter, tequila sales down a massive 12%. But investors looking past the soft sales and rewarding stronger cash generation and cost discipline, which in this environment, Scott, with alcohol demand waning, might be the best thing a company can do right now. All right. Good stuff. Thank you. Brandon Gomez. The market zone is next. We're now the closing bell market zone. Mike Santoli and UBS is Julie Fox here to break down these crucial moments of the trading day. Oliver Renek, standing by live from the CBO global markets in Chicago. We'll play some options action in just a moment. But Michael, to you first, your observations on this second day of September.

Yeah, market is held the line, I think, is the way I would think about it is the highs from early June and the S&P 500. They were not broken. You do have this nice little rally today. You have an interesting mix of obviously Nvidia and Dell pushing things higher and not really much going on with bonds. I do think the sensitivity of yields, you know, pulling back just a little bit from the highs on, you know, moderate data. We have Waller speaking tomorrow. I do think in the very short term, you might have the ingredients for a little bit of relief, in other words, a rally in bonds.

We'll see how the market deals with that. In general, I think it's sort of uncomfortably trendless at the moment. Nobody's really quite sure if we need a broader pullback or if the internal weakness that we've seen in areas like consumer cycles and industrials was enough to take the edge off. What do you do in about five minutes in overtime? Well, we're going to throw all those issues at our friend Chris Verone initially. We'll talk about that and really where it seems to be heading from here in the context of what we think of as, you know, this normalization of rates that has everybody's attention. All right, good stuff. We'll see in about four minutes.

That's Mike Santoli. Let's go to Chicago, Oliver Renick. Where are we playing options action today? In the NFL, Scott, it's back and officially a catalyst for Robin Hood stock. That's according to a bullish Piper Sandler analyst who wrote this morning that prediction market revenues at the broker will beat expectations. The shares are ripping and options traders are buying the story with at least four times as many calls bought today versus puts and 80% of the dollar amount traded in calls. Volatility is also uncharacteristically low in hood options. The 110 strike call expiring this Friday needs another 4% gain and goes for a buck 10 right now.

That was the most popular contract to buy in today's session, Scott. Okay, Oliver, appreciate that very much. All right, Julie, second day looks better to do. than the first. There's no question about that. How are you feeling about the market right now? We think markets right now are facing a number of tailwinds, really primarily driven by several things. Strong AI spending, strong earnings growth, a broadening of the earnings growth. So it's not just tech. And then finally, a resilient economy. So with that, our year-end S&P 500 target is 80100. If you think about how many speed bumps we've seen over the past few years. And yet, the economy and the stock market,

just keeps chugging along. So I think it's a great time to be an investor. Yeah, I know. What time, though, when do we hit a pothole? Right? I mean, yields are certainly getting a lot of play. Oil's elevated, data center backlash, momentum trade unwind. Where does that leave us, do you think? Well, I think, you know, you mentioned a lot of risks in the market. They still do remain. And I think it's a sustained rise in oil prices, a renewed acceleration and inflation or evidence that AI invest in is generating lower than expected return could challenge that thesis. But those risks right now, they're not part of our base case for now resilient growth, I think a patient federal reserve, continued AI adoption,

really suggests that this bull market has further to run. And investors should remain diversified, but we continue to maintain full exposure to stocks. And there's quite a few sectors that we really like right now. What's best? What's top of your list? Well, when you look across the different sectors, we like consumer discretionary, wealth effects, and moving past peak tariff headwinds should keep spending resilient. Gas prices would likely become more problematic if they rise about $5 per gallon, but we're not there at this time. We like financials. Deregulation is a key factor for the banks, and we expect continued gains in capital markets activity and an improvement in profitability. And then we still like AI. So pretty broad road to 8100.

Absolutely. What do you like the least? Well, right now I think, you know, what we're telling investors, it's important to stay invested. And during this current environment, I think it's an opportunity to make sure that your portfolio is properly diversified. Interest rates are back up again. And just like it was a few years ago, there's now an opportunity to lock in these high yields, in the fixed income portion of your portfolio. But I think you really need to look at the right opportunities.

We prefer short and medium-turn duration, quality government and corporate bonds. And I think that can provide nice income in the portfolio along with stocks right now. All right. Julie, thanks. Talk to you soon. Appreciate that. It's been a little loud down here because they're about to ring the bell. We're green across the board. We'll close that way.

Yield's part of the story, no doubt. A little bit of a breather, though, up early, the template.