Closing Bell - Closing Bell: Can You Trust the Bounce? 3/14/25

Episode Date: March 14, 2025

Should investors trust the bounce and how long can it last? We discuss with Hightower’s Stephanie Link, Trivariate’s Adam Parker and Shannon Saccocia from Neuberger Berman. Plus, star analyst Stacy Rasgon of Bernstein Research tells us what he will be watching from Nvidia’s AI developer conference next week. And, we drill down on some big moves in the software space today. 

Welcome to Closing Bell. Scott Wobbner live from Post9 here at the New York Stock Exchange. This make or break out begins with this bounce, much needed after a brutal week for stocks, the worst in some two years. We'll ask our experts over this final stretch how long all of this might last. In the meantime, let's show you the scorecard here with 60 to go in regulation. The major averages have taken back some key levels today above 41k for the Dow as you see fifty six hundred for the S&P and two thousand for the Russell. Everything was below those levels. It's been rough tech. A big winner today

is the mega cap jump along with those hard hit momentum names. So we're watching all of that. It's a big reason why you've had the bounce back discretionary stocks also doing pretty well today even after that dreadful read on consumer sentiment this

morning yields rising and that's probably helping sentiment as well. You don't want yields going down for the wrong reason and gold. How about that above three thousand for the first time ever maybe a measure of global sentiment right now. It does take us to our talk of the tape. Can you trust the bounce and how long can it last. Let's ask our experts Stephanie link Link, High Towers Chief Investment Strategist and Portfolio Manager.

Adam Parker is Trivariate's founder and CEO. And Shannon Sikosha is the Chief Investment Officer of Newburger Berman Private Wealth. Good to see everybody. All three are CNBC contributors. Stephanie, I begin with you. Whoa, what a week. I know, exhausting.

Absolutely exhausting. What do I do? Well, you know, we talked in January, we expected more volatility because just this year alone, because we don't have the fiscal stimulus tailwinds that we've had over the last couple of years. That was that, right? So I was expecting kind of slower growth and a little more choppiness. The tariffs, though, obviously much worse than expected, and the headlines, the day-to-day

chaos is really wrecking havoc on confidence in general. The tariffs, though, obviously much worse than expected, and the headlines, the day-to-day chaos, is really wrecking havoc on confidence in general. So I get why the market is down. It feels worse, though. The S&P's down 5%, but the Russell 1000 growth is down 9%, tech is down 12%, industrials are down 13%, discretionary down 18, so it feels pretty bad underneath the surface.

Oh, by the way, and value has hung in there. So if you're a value manager, you don't feel as bad as a growth manager. You know I'm kind of a blend. So I think we're not out of the woods. We have to get past tariffs and we just don't know what the timeframe is going to be. That all being said, Scott,

so maybe we go from 3% growth in the economy to something like one and a half. I'm just not in the recession camp, not yet. and that is because I'm looking at some of the data especially on the consumer side which is the bulk of the economy. If you know, look at the jobs numbers this week that we got in terms of jolts better than expected, initial claims better than expected, wages are anywhere from four to five percent, spending is still at 2.4. So I know we're seeing a slowdown and I know we got some pretty disappointing results from the airlines and the services part of the economy. I

don't think it's collapsing to the point where we're recession. Yeah. And I still think you can see double-digit earnings growth this year. People I talked to who make their living making a really good living doing this Wall Street stuff. Yeah. And their support, even the supporters of the administration and the policies tell me it's the rollout, it's the messaging, it's made them more negative than they thought they would be. They ever imagined that they would be 50 days in? It's a huge surprise. It's a huge, we all knew tariffs were coming, but we kind of thought they wouldn't be nearly the amount.

I mean, 200% today. Talking about some of the numbers that are coming out are absurd. So we don't know if this is a negotiation by the Trump administration, but we know more is coming and that will have more of an impact on earnings than we initially expected. I mean, I initially thought maybe 25, 25, 10, or 20 in China, Mexico, Canada.

I initially thought maybe it'd be a 5% hit to earnings. Now you're talking something like 7%, 8%. You know, you have David Solomon, the CEO of Goldman Sachs, Shannon, speaking of that, on this earnings hit. If you want to call it that, what might happen, we'll see. Quote, the discussion around tariffs in particular may weigh on corporate sentiment

and the impact on bottom lines could be significant. Bottom line, earnings. That's what we need to worry about. Well, I think, Scott, I think that you hit the nail on the head. We talk a lot about, you mentioned consumer confidence at the top. We've talked a lot about where is the consumer, where is the resiliency. We continue to look at non-farm payrolls data that's pretty supportive of that consumer. It's really about business confidence and if you think of the view, our view in particular, for at

trend or above trend US growth this year, it was the foundation of that was improving business confidence, hiring, cap X, and inflection hire in the industrial cycle. Those are what is on hold. And so I think this disruption around the tariffs, there's two things. You have to create a broader range for your growth expectations,

bring those down a little bit on the lower end. You have to create a broader range around your inflation expectations, bring those up on the top end. But that's not just the monetary impact of Tariff Scott. It's about the confidence and the uncertainty. And that's weighing on this potential infusion of growth into the economy. And so businesses right now, they're coming out of this period and saying, well, listen, we're constructive longer term. But right now,

we don't necessarily want to make that announcement about hiring or that announcement about a new project because it seems very unclear. And so what we're watching is we're looking at announced layoffs in the private sector. We know what's happening in the public sector. And so there are gonna be a number of things

that you're looking at in terms of determining how long this will last for, which was your question. But I think it really comes down to what businesses are saying and doing versus the consumer, which is different from where we've been over the last couple of years. Adam, this is an expectations and positioning game. And both are offsides from where people came into the year thinking and we're still going through this process of adjusting both. The problem is we don't know where to fully adjust both And we're still going through this process of adjusting both.

The problem is we don't know where to fully adjust both because we don't really know where all of this is ultimately going to go, whether this growth scare manifests itself into something worse or does not. Yeah, look, I mean, every part of me wants to get bullish again, right? We had the good call of saying the market will be down in the first half and choppy with concerns about tariff and all that. And you know, now we've seen a lot of people who were bullish that they're gonna be throwing the towel and get bearish.

And I really want to do it, right? But I can't. And the reason is because I don't think we've seen enough of a blow off on the positioning. If you look at the financial conditions index, you look at the financial conditions index you look at the VIX You look at retail flows like they're not showing Yeah, there's a couple multi-strat plot pods that blew up and degrossed But you're not seeing a ton of that and I think the fundamentals, you know You guys were just talking about spot-on, you know Steph I think nailed this the last couple quarters when she said hey there won't be a lot of negative pre releases in in

In January or October 1. I think this time in April there could be. I mean, if you look at the companies that were talking at big conferences in March, a lot of things are slowing. And so I think this is more than a growth scare already. This is actually like a growth slowdown. And so the question is, will we get negative guidance in April? Will we see stocks guide down, companies guide down and the stocks don't go down. If I see that behavior then I'll probably want to get more risk on. But until then I think we have to play a little bit more defense and offense because I don't

think the fundamentals are likely to V-shape recover like they have in previous cycles. I think some investors are trying to- I'm closing bell and I just lost my audio. Okay we'll fix that, Shan. I think some investors, Adam, are trying to come around to the idea that there's no Trump put, so to speak. And they always assumed that there was.

Now, for a day at least, we don't have any Trump tariffs. At least talk. It is all quiet on the Western front of the White House that is. Eamon Javers, we have no tariff news today. Correct? Yet. Scott, that's right. The New York Times is reporting that the US trade delegation told the Canadian delegation last night that there's no way for Canada to prevent a new round of sweeping tariffs on goods from that country on April the 2nd.

And a White House official confirms that to me today, saying, the message delivered to the Canadians last night was that the president intends to put reciprocal tariffs in place no matter what. Of course, that raises the question then of why there are negotiations going on at all if there's no possible solution until after April 2nd. And Scott, I can tell you that despite the steep stock market losses we've seen in the past two weeks,

this just doesn't appear to be an administration that's about to blink right now. The argument here is that there are two possibilities and both are a win for Americans. Either the US gets an enormous revenue boost or trade relationships get reset in a way that boosts American manufacturing. So they're looking at this and they say it's a win. And I've been talking about this all week, Scott, but this is a White House also that

has a tremendously higher tolerance for stock market pain than it did in the first term. They're looking at the losses on Wall Street and kind of shrugging them off all week and saying, look, we're making big changes here and that's going to mean that there's going to be some pain on Wall Street. And we're fine with that. Yeah. I appreciate the update. Eamon, thank you very much.

Eamon Jarvis on the North Lawn. Steph, let's just play off that. It's a win. Until it isn't. Until it isn't. This idea that there's no Trump put, so to speak, until there is. Well, there's a lot of time between now and the first part of April.

So there's that, number one. And number two, I firmly believe that we are seeing manufacturing already coming back into the country. And we know that the tariffs, the reason for the tariffs is to have other companies come back to the country and do business here. And you're seeing that. I mean, look at what Apple announced

just a couple of weeks ago. I, Eton had, you know I've been adding to Eton. You know I've been adding to a lot of things actually. But Eton is one of them. And they had an analyst day this week. And they said 70% of the grid is over 25 years old. That's a trend that's only going to benefit that whole theme of AI data center grid power.

That is something that I want to be buying into. I know you want to be buying into what you might not even realize for five years, three to five years, if not longer. Apple's not building iPhones, by the way, with robots tomorrow or the day after or next week. Right, but we're seeing activity come that wasn't going to come. And it's going to help the economy down the road.

So yeah, maybe it is a short-term pain, but I feel like some sectors, some stocks are down huge, and there is an opportunity to get where you have themes that you believe in long-term, if they get hit hard, then you want to be adding. I had 9% cash. We talked about it the other day on halftime, I'm now at 5% because I have been slowly adding, not big, slowly adding to stocks that are down 15, 20, 25% where I believe the fundamentals still are quite strong. Maybe so, maybe so, but the point Adam that you make

is despite fundamentals that could be still strong, valuations could still be too stretched. That's the point you were making, that maybe the unwind hasn't come out fully of those names because what was straight up and to the right needs to correct even further. I mean I think if the margins are going down or the guidance is bad, you know, so far we haven't seen any stocks do well. Most of the stocks that have done really badly in the last month have been pretty heavily or the guidance is bad, you know, so far we haven't seen any stocks do well. Most of the stocks that have done really badly in the last month have been pretty heavily

indebted low quality stuff, a ton in the consumer space. I think what Steph's talking about makes sense. You're trying to figure out which growth themes that you believe in long term, where the high quality businesses sell off you want to add. I mean, I did a note last week looking at all the stocks that are a hundred billion market cap or larger just trying to say which ones do I think make sense and I think that electrification theme does make sense and I get wanting to own a stock like Eaton. I mean our call this year was you know upgrade the industrials go overweight downgrade discretionary our

biggest underweight because the consumer was good and slowing and the industrial conditions generally weren't that good and they might improve and the stocks act more on you know the perception about change than they do level so I I'm with stuff on this one actually I think that makes sense. Yeah I mean we have seen you know some of these stocks come down you've been buying more eaten right you've been you've been telling us about about that you're still a believer and a buyer on the weakness you're never never necessarily gonna catch the perfect moment. Gosh, no, no, no, no. I mean, I'm just buying little bits, little increments,

but the financials I think are also making a lot of sense. Some of them are down 10, 15%. Deregulation is going to be positive for them. If it, you know what, that's a good point, because, you know, again, I had this conversation yesterday with somebody who's like, where's the talk about all the deregulation? Where is it?

Well, they're starting- They believe in it. Right. They want it. They think it will be tremendous. Yes. Well, we're not talking about that. We're talking about tariffs. They decided to go after tariffs first. We have to get through tariffs. We'll have to deal with whatever that is and then we're going to get on to lower taxes and then we're going to get on to

deregulation and there's no question in my mind Basel III endgame is going to be a positive for the banks. They'll have to they'll have a lot more capital where they can buy back stock. I also still very strongly believe in the net interest income story and I am still a believer in the M&A story. I know it was weak in the first couple of months of this year, but I still believe once you get through tariffs, I think you're going to see a lot of M&A this year. And then there are other themes, so cybersecurity, some of those stocks are down a lot, right? You're all buying more Palo Alto. You are.

I'm buying more Palo Alto. I mean, you know, so I'm trying to find some things along the way. I like Boeing, added to Boeing today. I mean, and added to Snowflake finally, because they actually beat and raised, and the stock is down 15% from when they did that. So that's my point, like, just trying to find good companies, solid fundamentals, good themes,

and I'm not gonna catch the bottom. You added to Target, and that just brings up the conversation about that brutal consumer sentiment read earlier today. Matching the tone of the markets lately, stocks like airlines and cruises and retailers have really been hard hit. Courtney Reagan is watching that money for us today. Little bit of a bounce, but we'll see. Yeah, for today, right?

So I kind of think whatever confidence that just reported holiday quarter brought, it's gone faster than Santa up the chimney, along with consumer confidence. And we've got extreme cold weather that crimps sales, then tariffs increasing costs and prices, along with these massive job cuts for government employees and related industries. It's all leading retail executives

to sort of sing this same tune, this chorus of caution of the retailers that gave first quarter guidance for sales and or earnings. Only two were above expectations, according to LSAC. Dick's Sporting Goods, Executive Chairman Ed Stack told me quote, it's kind of silly to guide above consensus. The world is too uncertain out there right now.

V of A sales desk says, it hasn't felt like the underlying consumer health is being questioned at this stage, rather that distractions are adding up. There's reason for future unease, uncertainty, and some risks to the typically immune upper income consumer. Indeed, Dollar General CEO Todd Vasso said trading down is back and accelerating for mid and upper income consumers. And while some retail stocks are higher today, like you pointed out, Scott, investors have been generally negative, even on names considered

fundamentally higher quality. Bath and Body Works, its management said, quarter to date, momentum will drive sales at the high end of its guide. Still, shares down 19% in a month. Urban Outfitters, it hasn't seen any major changes to its consumer sentiment. It called the consumer, quote, excited, but not exuberant. Still, the stock down about 13% in one month. Seems there's nowhere to hide for the consumer. Yeah, yeah, not these days. Port, thanks very much for that. Courtney Reagan. Shan, what about the consumer?

And what about consumer stocks? The interesting thing here, Scott, and sorry, hopefully you can hear me and I can keep hearing you, is that we're really looking at this inflection point for the U.S. consumer. We know that consumer spending has been concentrated in sort of the higher income cohorts, but what you're seeing here is you're seeing a consumer that's looking at the next 6, 9, 12 months. They were anticipating an environment where they would have lower rates.

They were anticipating an environment where prices would stabilize and potentially see some deflation as we've seen in goods. And so what you're seeing now is you're seeing consumers indicating that they feel uneasy, and then absolutely you see corporate executives looking at this as an opportunity to go ahead and be conservative. I think that that could potentially play well in the second half of the year as, you know, perhaps we get some additional resolution around tariffs and we do start to see that deregulation impulse and some of that more pro-business sentiment.

That could actually set up nicely for consumer stocks in the second half of the year. And we're feeling actually a little bit more positive or constructive on consumer discretionary as we move into the second half of the year. I mean, Adam, to be honest, I mean, this is a trade I feel like that you've had more conviction about almost than any other and that being negative consumer related stocks, especially retailers. Your confidence, I'm certain, couldn't be improving these days given where we are. No, I'm 90% agreement with what I've heard from both Shannon and Steph.

Steph and I were joking last week together again about Target because it's one we disagree on but like I I think the consumer is getting worse and look if you want to look at one thing plot the CDS on Kohl's a stock I told you was obviously was zero a year ago on the air. I think look at to look at one thing, plot the CDS on coals. A stock I told you was obviously with zero a year ago on the air. I think look at Hertz, look at, you know, post the delta, the government spending. Like these CDSs are blowing out, right, way above. So I think the stuff is slowing and they're not going to get on anybody. The coal CEO is talking about like fabrics and colors.

Like what are they, crazy? They got to like restructure the entire business. They have seven times as much debt as they do equity. So I think there's a lot of businesses that really need to fundamentally change and the ones that have a great online presence and are growing in a fashion area, sure, there's going to be some winners. Obviously, there's winners and losers. But I think the consumer spend is slowing and it's really in multiple data points. The only time we've had confidence, the Michigan confidence is bad as today, briefly in 2022. Before that, the European financial crisis.

So you can go back and study it. The consumer doesn't rebound. So if Shannon's right that we get the recovery, I think it's possible. It'll be when we get all this policy stuff behind us and steps point spot on. You get the taxes and the regulation. And that's what drove, we were together election night, Scott. That's what drove the optimism. We we wrote by the election sell the inauguration because you need the optimism of that regulation and growth to come through and dream about

it for 2026 and we're not we're not there yet in my in my judgment. I mean let's also make clear that there's a distinction between sentiment and spending the Fed chair himself said that the last time he was speaking in New York a week or so ago, a drop in sentiment doesn't necessarily fall through to a drop in spending. Your point is the reason why you can still have

faith in the consumer is the job market. Yes, 100%. If the job market starts to unravel, bye bye. Right, so weekly initial claims. Running at about 220,000 for the four week moving average and the three month moving average. A recession, that number gets as high as 350,000 to 375,000, so we are nowhere close

based on initial claims. And I mentioned earlier, jolts. Jolts were a little bit better. You look at some of the ISM surveys, the employment numbers are less bad. They're not good, they're less bad. So I just think that is absolutely what we have to keep our eyes on, but also wages.

And then we didn't even talk about inflation. I mean, inflation is coming down. It's still too high for the Fed to do anything, but it is coming down. And we were at 9% peak in CPI, now we're at three. Okay, it's not great, but it's still coming down. Gasoline prices are down 12% year over year. Interest rates are down.

So there are a lot of things tailwinds for the consumer. I'm not saying it's so robust. And I agree with Adam, there are some crappy natives out there, right? Kohl's has not been a performer for years on end. Macy's, years on end, issues. I don't think Amazon has a problem. I actually think Gap is one of the sleepers this year.

And Target, yeah, it's not done well, but it has never been a traffic problem. It's an execution problem, and I think they're going to get their act together. Let me ask you this before we wrap it up. You glad you don't own Apple? Yeah. I mean- What do you get for 28 times forward estimates? You get less than you were paying for 31 and a half times.

But you're getting 5% revenue growth and maybe 12, 13% earnings growth. Services is definitely humming. That's great. But they have a lot of technology problems lately. And I think iPhone 16, not the super cycle. And maybe these technology problems means iPhone 17 is not the super cycle. And maybe these technology problems means iPhone 17 is not the super cycle. So what do you get?

Maybe you get a buyback machine, sure. But I'm not ready to buy it, not yet. Let's leave it with a couple thoughts quickly. Adam, you first and Shan, just on the mega caps. They have corrected a fair amount, as have their multiples, to the point where some now say, okay, I didn't have a problem with their multiples before

and now I feel like they're on sale and I'm still a big believer and Nvidia's got this big event next week, so why not? I mean, it's hard not to like Nvidia now more than you did at the beginning of the year, right? Stock's down a lot and the main data that came out of Morgan Stanley's tech conference a couple weeks ago was everyone said their capital spending plans are still intact.

So if I'm worried, which I am a little bit about revenue for other companies in the market, I'm a little bit less worried about NVIDIA's, and I guess the relative estimate achievability of NVIDIA's revenue is better than I thought, and their stock's down a lot. So sure, I like it more, I get that logic. But you know, I guess what I'm trying to think through it more, I get that logic, but you know, I guess what I'm trying to think through is if we do get a recovery, do you think it's going to be like the low quality hypergrowth junk stuff or do you think Mag-7 can get back and work? And I think right now the next three to six months I

don't see any accelerating revenue or margin expansion from that group. And so as we talked about before, there's no funds raising money for, you know, margin contraction decelerating revenue businesses. So I think you got to own some 30% of the bench weight, 29% of the bench weight, you own 20, 22, 23%. You got to have some exposure, but I don't see why I need to be overweight heading into April earnings. Last thoughts, Jan.

Yeah, we, I mean, you know, Scott, we've been talking about these vulnerable valuations and we're seeing that now. I think that there's gonna still can be some discernment between sort of the Magnificent 7, those top seven to 10 stocks in the tech sector. We're more optimistic and constructive on software generally than semis.

We think that IT spending and cycle is gonna hang in there and we think that AI being incorporated into underlying software applications is really sort of the next phase over the next year or so. And I would agree with Steph. I mean, cyber is going to continue to grow from a market perspective, particularly against this difficult geopolitical backdrop. All right, everybody, we'll leave it there. Adam, Shan, Steph, we'll talk to all of you soon. Have a good weekend. I know that for certain, you as well.

To Christina Parts-O-Nevelist now for a look at the biggest names moving into this Friday close. Christina? Oh, there's a lot of movement. D-Wave Quantum shares surging right now after multiple analysts recognized the company as an emerging leader in the quantum computing space. D-Wave posted results before the open on Thursday where they beat on revenue, but they still failed to turn a profit. Doesn't matter though. Piper Sandler

has significantly increased their price target from $2.50 to $8, highlighting D-Wave's recent sale of an advantage quantum computer to a German research institute. D-Wave shares are up 42%. Other quantum names also climbing higher trading in sympathy with D wave You got reggae up 27 ion Q up 15 quantum computing almost 26 But keep an eye on this entire group next Tuesday when Nvidia CEO gives a keynote speech Mizuho analysts suggesting Nvidia might reveal a new quantum computing product roadmap during the event So that would be on Tuesday as a catalyst. NVIDIA is also hosting a Quantum Day. I'll be there on Thursday with various executives. And that could also serve as another catalyst

for this entire sector, Scott. All right, Christina, thanks very much. We'll see you in a little bit. Christina Partsanevalos, we're just getting started here on Closing Bell. Up next, star analyst Stacey Raskotton tells us exactly what NVIDIA's AI Developers Conference could mean for that stock.

He will join us just after the break. Nvidia shares are higher today though still down more than 20 percent from their record high just back in January. The company getting ready now

for its big GTC event next week. Top chip analyst Stacey Raskin of Bernstein here with what you should expect from that. It's good to see you. Welcome back. Good to be here.

As you look ahead to next week, just let's look at what happened to this stock of late. I mean, how should investors feel about it, the ones who love it the most? Yeah, even though I think I heard in your prior segment if you liked it before, you should love it now. I've been a little, I guess maybe surprise is the wrong word,

but I've been a little surprised at the magnitude of the decline. And I get it, the whole AI space has kind of rolled over somewhat on DeepSeek and macro and tariffs and just a broader de-grossing, and I get all that. At the same time, NVIDIA, I mean, we're right at the beginning of their Blackwell product cycle. It has just started. It is likely to be the biggest product cycle in their history.

We'll likely get some more updates on that next week at GTC. We'll probably also get our first look at Rubin, which is the next generation. We may even get a little look at what comes after Rubin. They may talk about co-packaged optics. They may talk about quantum. They may talk about ARM PCs. They'll probably talk about robotics and every physical AI and everything they talked about at CES.

I think it still looks really, really good. And at these current valuations, I mean, it went down to 23 times earnings, it's about 25 now, it's at trough valuations. You've been really, really good buying it there, like historically, I think over the last 10 years, if you bought it at 25 times or below, your average one year return from that moment

was like 150%, and it's never had a negative drawdown over a one year period buying it under those. I really like it at these valuations in the beginning of a product cycle and with their conference of the year starting next week. Yeah. How do we know, how do we know, I guess I'd ask it this way.

I'm the investor, I love Nvidia. I believe everything that you said. I'm the investor, I love Nvidia. I believe everything that you said. I'm a huge fan of the stock, I agree with you, it's come down, it was never that expensive, blah, blah, blah, the whole story, right? That's gotten the stock to where it is. But the deep seek thing changed the way that I think I should think about the future,

perhaps, for this company. Whether it's just going to change the amount of money that needs to be spent, whether it changes the dynamic of the kind of chips that need to be used, and it's just too early to say that it's not going to have a tremendous impact. It's already had an impact, but what impact has it had? It's been a positive impact, have a tremendous impact. But it's already had an impact. But what impact has it had? It's been a positive impact, not a negative impact. This was my read on deep. We talked about this, I think, during that circus.

I know we did. But has it already had that? Just because Sachin Adela and others, like, you come out and say, well, it's going to lead to more compute, which leads to more chips. And I mean, but what's happened since then? So we've seen H20 like inventory like in public cloud, inventory has gone down. H20 rental prices, I'm sorry, H100, excuse me, inventory has gone down. H100 rental prices have come up.

H20, they're China sales, like they're sales of their China legal parts into China. There's a ton more demand like on the back of DeepStake. They need more compute, not less compute. All of the hyperscale is everybody else has been taking their capex numbers up by leaps and bounds this year. Again, I think from your prior segment, what I think came out of some of the conferences in this latest season is that those spending plans are still very, very intact. If anything, we've seen increases in demand, not decreases from and and since deep seek, and that's been my view.

But I thought it was positive. Again, the market clearly disagreed. But I think it was good. I think the prevalence of more cost-effective models drives adoption. That's what had been one of the big barriers to adoption by software companies and the like. It's cost.

If we can actually get effective lower cost models barriers to adoption by software companies and the like. It's cost. If we can actually get effective lower cost models that drive adoption everywhere, how is that not a good thing? I think it's a good thing. Are the spending numbers from the hyperscalers recession proof? I look, I don't think anything is recession proof

in hardware, like don't get me wrong. But at the same time, I don't think what they're spending right now is to drive revenue right now. Like these are long-term investments, they've got long-term visions. In some sense, it's almost existential too. So what we have seen is as they're spending on AI, like we've seen like spending on other things,

like decline. For example, you can look in the traditional server space, and I cover Intel and AMD, and you can look at just like the server CPUs, they've been very bad, like frankly for the last several years, and particularly as AI and spending has shifted toward things like GPUs, their spend has come out of other areas to focus on AI.

I think if they start cutting, and I mean, look, in a recession, I think all bets are off, but this may be like lower down on the list, at least, of investments to deprioritize. I know, but as you talk about, you know, their spending for the longer term, I feel like we're getting a little less patient to some degree with that.

Like, we want the results to come sooner at this point, and if you do have a more dramatic economic slowdown, that could throw a wrench into what we thought even, I don't know, 50 days ago. Yeah, but that's not unique to AI or Nvidia. That's just a fact, right? Recessions, economic uncertainty, tariffs that get put on and taken off like every other day. I mean, that's why the market multiples have come down. Like the earnings by and large have not come down nearly as much as any of the stocks have, right?

It's all multiple and why? It's because in some sense, if things are more uncertain, you don't know what's gonna happen, you're gonna pay less for that stream of earnings. But that's not like specific to AI. That's a general issue that I think the entire market is facing right now. I mean, and your point overall, before I let you go,

is just tune out, look past the noise. Because there's a lot of noise. There's a lot of noise. I mean, I do my best to look past it. It's not always possible. Like sometimes the noise is the story. But there's a lot of noise out there right now. You gotta do your best to at least try

to see what else is there. All right, thanks for joining us. I have a feeling we'll see you next week to react to whatever happens with Nvidia. Stacey, be well. That's Stacey Raskin. Up next, shares of Tesla charging higher today. Some new overseas sales plans

we'll tell you about after the break. All right, we're back on the belt. Looks like Tesla is developing a lower cost model Y in China, the stock popping on that news and perhaps because it's just been down a lot lately. Phil LeBeau is here with those details. What do we know about this? How much do you think it's playing a role in what we're seeing in the stock? A little bit, Scott, but not a lot because we've known that they're developing a lower price model Y. That has been known for some time.

The question has been when are we going to see it and what are the definite specifications including the price. Now there was a report overnight out of China. That's what got some of the juice going for shares of Tesla essentially saying that this would be a stripped down Model Y. That's up to interpretation in terms of how stripped down it will be. The China rollout is expected in the second half of this year. That's not a surprise. Most people have speculated that's going to be the case.

And again, pricing and specifics in terms of performance, etc. That's to be determined. Can they sell this under $30,000? If they can, when you add in the federal EV tax credit, well then it could be a game changer. There is definitely an appetite for lower priced EVs in this market. Even if they were to take away the EV tax credit, well then it could be a game changer. There is definitely an appetite for lower priced EVs in this market. Even if they were to take away the EV tax credit, there would still be demand for a lower priced model. So the question becomes, how much will their sales be impacted as you take a look at shares of

Tesla? Keep in mind that UBS has added up a number of the sales reports from Europe, from China, elsewhere. We don't get them here in the US until the end of, beginning of May, I should say. They're down 16%. That's the expectation from UBS. Today it cut its price target down to 130. All of the auto stocks getting a bump higher along with the market today. But remember, Scott, April 2nd, that's the target date everybody's focused on because if that's when auto tariffs go into effect, it's a whole different ballgame for all of the automakers. I wanted to ask you about that, actually, because much is being made about this letter

that was sent, I believe, to the White House, and the fact that it was unsigned is how it's been reported. Why are we reporting it as such? I mean is the implication here that Musk as the CEO didn't sign it so it's there's some ambiguity to who it's come from at the company? Expand on that for me. I'm not sure there's ambiguity from who it comes from Scott. Look, Tesla hasn't responded to questions as to why Elon Musk did not sign this letter and let's be clear here it's not like Elon Musk can't get a hold of the US Trade Representative. You and I both know that they could probably he

could talk to him ten times a day if he wanted to. This is the company saying there will be impacts because Tesla is a manufacturer that does export vehicles. Now as far as we can tell there is a manufacturer that does export vehicles. Now, as far as we can tell, there is no indication that President Trump plans to do carve-outs for specific companies. But if he did, then you would ask, well, is he going to do a specific carve-out for Tesla or for another company? That's the question that's being raised at this point.

The letter is very vague, Scott. There was nothing in this letter where you said, wow, I mean, Tesla is a manufacturer of EVs. If there are retaliatory tariffs that are put in place because they export their vehicle to other countries, Tesla would feel an impact. All right, Bill, thank you. Appreciate your insight there, Bill LeBeau. Up next, we're tracking the biggest movers as we head into the close. We'll go back to Christina for that. Well, we've got a cybersecurity firm stock right now skyrocketing after crushing revenue expectations and a healthcare giant takes a hit as a judge revives a lawsuit over infant formula safety concerns. The market's winners and losers straight ahead.

Less than 15 from the bell back to Christina Partanavoulos now for the stocks that she's watching. Tell us. Let's start with Rubrik because those shares are higher after it beat on revenue and posted a better than expected loss though for Q4. Wedbush boosted its target on the cybersecurity stock to 80 bucks from 75 saying they're pretty confident in its growth and strong subscription revenue and that's why you're seeing shares right now almost 26%'s best day on record. Meantime Abbott in the red after a judge ruled a new trial could be heard over allegations

Abbott Laboratories ailed to warn a mother about potential risks of its baby formula designed for premature infants. This actually reverses an October decision by a Missouri court that had previously ruled in the company's favors and that's why, or the company's favor and that's why the shares are down about two and a half percent Scott. All right, Christina, thanks so much. Still ahead, software stocks jumping in today's session. We drill down on the names you need to watch coming up. We're back on the bell just after this break. We're now the closing bell market zone, CNBC senior markets commentator Mike Santoli here to break down these crucial moments of the trading day.

Seema Modi on the big move today in software. Brandon Gomez on what's behind the spike in Peloton. But Mike, I begin with you. Almost a 700 point gain on the Dow. I mean, this is the kind of bounce that we needed heading into the weekend. You can check off one box, yes, which is you got a very broad rally that mostly is held near the highs.

It might have a chance of hurtling this level that it has been unable to crack earlier this week. You're breaking this pattern of much lower lows every day. So all the technical stuff you'd say, this is a start. Now is the time when you also recite a lot of the mantras, what happens after correction. V bottoms are rare, a low is a process, not a moment. So there's gonna be a little more work to do here.

And I think the big question is, did the, not just 10% to come to the S&P 500, but the amount that was taken out of consumer facing stocks, things that would be hurt in a rougher economy, have those things been nicely discounted? Did we build up a little bit of valuation cushion? Can't really answer that, obviously today, but it's definitely progress and it suggests

that that urgency of exiting the mega caps has also lifted for day. What's happened in SEMA and software today? The story today, Scott, is DocuSign leading software stocks heading for its best day of the year. CEO Alan Tigerson telling CNBC earlier today that DocuSign is starting to turn the corner that earnings beat that it delivered was boosted in part by its new artificial intelligence enabled product called IAM. It's a platform for optimizing processes involving agreements. CEO adding that

it's opening a treasure trove of data for clients and sharing that the company is now partnering with Microsoft and Google. The street likes what it heard. Other software names rebounding, worth noting Salesforce, CrowdStrike, and Palantir up about 8-9% heading for one of its best days in quite some time. The IGV ETF also on track for its best day since early December, but let's put this into perspective still well off the highs after the sell-off that consumed software names earlier this week. The group set for its fourth straight weekly decline.

And next week, Scott, there'll be two summits, one from Adobe and Synopsys, that will be hosting product launches. We'll see how that could potentially be a catalyst for the sector. All right, Seema, appreciate that. Thank you, Seema Modi. All right, let's talk about the spike in Peloton today. Brendan Gomez here with us at Post9.

What's going on here? Yeah, hey, Scott, look, the stock rallied about 15% in the back of a canaccord genuity upgrade today, taking the fitness stock from a hold to a buy rating. Now, the the firm saying Peloton has regained its footing and is a clear leader within the connected fitness space. Now the pandemic darling has been unfolding its turnaround strategy for its six million members, launching its new strength plus app to act attract digital content subs, cutting sales and marketing and administrative costs. CEO Peter Stern still just stepping into his first quarter, the company the street learning rather leaning on his experience combining hardware and software

from prior roles at Ford Apple and Time Warner Cable to right size the company's cost structure improve unit economics get the balance sheet back in shape Scott this one's going to be a marathon not a sprint clearly. We marked what five years of the pandemic beginning this week and this is the stock maybe more than any other that we think about when we talk about that period and how much it's corrected since. Yeah yeah you saw that run up the pullback and now perhaps the fundamentals improving in order to justify evaluation on this name. Alright Brandon thank you so much for that. That's Brandon Gomez. We got a couple minutes to go as we take a look at the

market here about 700 still as we said. I mean, I had to figure that people were only going to look at these tech stocks get hammered so much. Yes. So once you got the sense out there that there wasn't going to be any more of that kind of forced seeming selling, I think you did manage to get some traction. Nvidia's move is the one that has the look of real money getting back in based on valuation, depending on your numbers. I mean, it basically got down to a market multiple. And so that one really seems like it could be a turn. The rest of them is just a matter of saying maybe these stocks can act as macro defense again.

You know, nothing got really cheap, but you know, Microsoft got an upgrade today because it has basically come back down a few multiple points and it did get a little bit of a lift on that. So all to the good, 90% upside volume in the New York Stock Exchange right now. Nothing to really complain about in terms of today's action. It did also, it's a benefit come when you got the ugly consumer sentiment number so it was able to shrug that off. It definitely also came though on a quiet day for policy

headlines. So you want to see at some point get some evidence that maybe the tape is building up a little bit of resistance a little bit of an ability to look through. I don't know if that's going to happen between now and April

2nd on tariffs but we'll have to watch. You got to feel like Apple at this point really becomes a show me story. Yes. Because of all the commentary around it and the slide in the stock,

it's down almost 11% this week, even with that move. Like so many stocks, you have these charts that look like they've dialed back to like six or eight months ago and it seems like they're sitting right on this plateau that would be tough if it broke. So it hasn't yet,

it's still kind of holding in that upper range well above 200. But yeah, there's no doubt about it that it's not just a matter of jumping into the old favorites. Apple has to prove something to prove here. All right, have a good weekend. We will clap and then we'll ring out a green ending to a turbulent week on Wall Street. Dow is going to go out there with 700s with a flush by it. I'll see you on the other side.