Closing Bell - Closing Bell: Great Expectations 11/13/24

Episode Date: November 13, 2024

Where are these markets likely to head over the next few months? Courtney Garcia of Payne Capital, HSBC’s Max Kettner and Capital Area Planning Group’s Malcolm Ethridge debate where they see stocks headed. Plus, top technician Jonathan Krinsky from BTIG says U.S. stocks seem to be the only game in town right now. He explains why. And we explain why Jetblue shares soared in today’s session. 

Welcome to Closing Bell. I'm Scott Wapner live from Post 9 here at the New York Stock Exchange. This make or break out begins with great expectations for the economy and of course your money. Following the post-election stock surge, we'll ask our experts over this final stretch just how long this can all last. In the meantime, I'll show you the scorecard with 60 minutes to go in regulation. We did have a midday pickup in the major averages, but it's dissipated a little bit. We're still hanging positive on the Dow and the S&P. NASDAQ is a fractional loser. The latest CPI came in as expected, but did still show that inflation remains sticky. And that sent yields at the long end of the Treasury curve higher today. 445 is where we sit on the 10-year, and that might be

part of the issue today. Elsewhere, you do have yields sit on the 10-year, and that might be part of the issue today. Elsewhere, you do have yields at the shorter end, the 2 and the 5. Our lower discretionary and energy are the best sectors in a mixed day overall internally. It does take us to our talk of the tape, where these markets are likely to head over the next few months. Let's ask Courtney Garcia of Payne Capital Management, a CNBC contributor with me here at Post 9. Welcome back. Thanks for having me. Are we supposed to just keep buying into this post-election surge?

Or what's your take on just how quickly we've done what we've done and what it might mean for where we go? Yeah, and clearly what you're seeing is there is like an excitement and a euphoria post-election. And everybody is really starting to get in there and putting that risk on rally. And when you look at like the S&P 500, for example, it is trading expensive, right? It trades about 22 times forward earnings, which is historically expensive. But as you've seen in history, markets can stay expensive for a while. So I don't think this is ending any time in the near future. I think if anything, one thing that's keeping the markets from going higher is how much cash has been on the sidelines, which, interestingly enough, last week, more money went into cash. So those numbers

actually are reported weekly. I think it'll be interesting to see what happens this week to see like a full week post-election. Is money starting to make its way back into the markets? Because that's what ultimately will send things higher. I mean, it's funny, you say the word euphoria, which it certainly felt like it. Nelson Peltz at Delivering Alpha used that same word today in which he said, I don't think this rally continues. Trees don't grow to the sky. Definitely not uninterrupted. There will be something that will upset it. Now, he's really positive about the election outcome and what it could mean for the economy and growth moving forward. But even he says, I mean, come on, it's been a little crazy, right?

Does it feel like it's been a little too much? You know, I wouldn't think so. But I think that's where you need to look at different sectors of the market. So all of the excitement has been around AI and the Mag7, and that's continuing to do well. And though I don't think that is going to end, that is where you want to look. So take, for example, the S&P 500, which when we invest here, we split this out over growth versus value rather than just blindly putting everything into the S&P 500. The growth side trade about 28 times at a PE, which is well above its five-year average, whereas the value side, so these are things like banks and your cyclical sectors, which are arguably positioned better under a Trump administration, are only trading like 17 times earnings. So I don't think the rally is necessarily ending

anytime in the short term. But with that new money to add, I think there's a lot of other areas of opportunity that still have room to run. OK, you say banks. Deutsche Bank raised their price targets on almost every stock in their coverage universe. They didn't upgrade everything, but they certainly raised their price targets on everything. Goldman Sachs, for example, goes to $575 instead of their old target of $500. There's a list on your screen here of the price target moves we had today at Deutsche. Mike Mayo,

Wells Fargo, calls it a watershed inflection point for banks. Talking about 15 years of harsher regulation is now going to come to an end. Is this the spot, even with really big gains this year, that you need to zero in on more? Absolutely. And I think investors tend to be a little underinvested here. And I think there's a lot of things that are positioning nicely. The deregulation has been the big hot topic, which I think arguably is going to be a better boost for this industry as opposed to things like tax cuts, which is going to likely happen on the corporation standpoint. But you're also seeing valuations are lower.

And also the yields curve is steepening, which is a better thing for these banks. So I think they have been a very underloved sector, but absolutely something that's going to perform well, regardless of Trump being in. But with him being in, I think it actually just positions them better. I know you like emerging markets, OK? Are you talking about China included in that?

Or are we thinking India and elsewhere? Because obviously we're worried about, you know, the impact of tariffs and the turn up of the ratchet on that. What do you think? Yeah, and I think that's where some of the concern with China, it's going to have a lot of political headline risk. And I think some of that is going to get oversold based off Trump's stance on China. But I don't think this is something on a discount. So we own emerging markets, the entire markets, including China. China is the one that has that headline risk.

But when you look at this in the bigger picture, emerging markets like 85% of the world's population, 60% of global GDP, only 10% of the world's market cap, however. And U.S. investors only tend to have like 2% invested in there. So I'm not saying go all in. It tends to be more volatile. But that is one of those areas where if you're doing additional money, you need to deploy. Absolutely pick that up. It's got great value. I think my point is, I mean, it could be become even more volatile depending on, you know, what happens with the new administration. Speaking of, we are getting some breaking news

out of Washington, D.C. now. Megan Casella has that for us. Megan, what do we know? Hey, that's right, Scott. We have just learned that the president-elect Donald Trump is officially naming now Florida Senator Marco Rubio to be his secretary of state. This is a pick that we've been talking about for about 24 hours now, but it hadn't been made official yet by the president-elect himself. We now have a statement from Trump saying that he looks forward to working with Marco to make America and the world safe and great again. Now, this is the second of the so-called big four positions that we have official names for, along with the defense secretary pick. That's Pete Hegsath, a combat veteran and also a Fox & Friends weekend host. We're still waiting on the Treasury secretary and the attorney general to round out those big four positions,

along with many other names. Scott Moore, when we have it, and one last note on Rubio, this will open a vacancy in the Florida Senate. So Florida Governor Ron DeSantis will have an opportunity to appoint someone to fill Marco Rubio's seat. There's been a lot of discussion already about who might take that seat with the president's daughter-in-law, the president-elect's daughter-in-law, Laura Trump, being at the center of a lot of those discussions. But much more to come on who might fill that seat. For now, we know Rubio is headed to secretary of state. Scott.

Megan, thank you. Megan Casella in Washington with the latest as these jobs get filled out, or at least the nominees, we learn who they're going to be. Speaking of geopolitical risk, I haven't talked about that almost at all since the outcome of the election. Do you think about that at all as it relates to what the new year might hold for stocks? I think it's something you always have to consider. And I think that's where you want to have some of those positions in your portfolio, things like gold, which actually tend to do better under more geopolitical tension.

So it's not something I think you want to invest around, but you always want to have that hedge in place because those headline risks have absolutely not gone away. I mean, you do like materials. Like, are you thinking of, you know, gold and metals and things like that? Are we looking at, you know, copper or other areas of materials? Absolutely. And I think this isn't so much on the geopolitical risk as much as on just accelerating growth in the global economy. And if you believe that that is going to continue, which I do, that's absolutely an area that tends to benefit. And if you see industrials doing well, I really like some of those metals like coppers, which is used in, you know, much more practically. So in things like new EVs and you're using these in the electrification of the economy,

as opposed to gold, is a little bit more tied to sentiment of what's happening in the economy. So I think some of those are really good opportunities to take advantage of. A wild card feels like it's energy. I'm really not sure what to make of prior history. Doesn't mean really anything as it relates to future results. How many times have you heard that in your investing career? But nonetheless, you know, energy, the worst sector under the prior President Trump and the best sector under current President Biden. How are we thinking about that space under another Trump administration? Yeah, and I think that's where you don't want to get completely caught up in like the Trump trade. I think you're going to see some of this knee jerk reaction.

Some of that might be a pull forward because to your point, that was actually one of the worst things under the last Trump administration. I don't think people would have thought so. But I think this isn't really a Trump trade as much as it is an AI trade. Right. I mean, when you're looking at the amount of demand for energy, when you look at these data centers that are needed, there's not enough to go around, and that is not stopping any time in the near future. You're having to see these nuclear plants getting taken back online just to try to fill some of this gap.

So I think that's a much bigger trade on the secular changes happening with AI much more than just the administration. All right. Let's bring in Max Kettner now of HSBC Global Research and Malcolm Etheridge of Capital Area Planning Group. Malcolm's a CNBC contributor. It's good to have you both. Malcolm, what's your take on this, what some are calling euphoria post the election? Does it continue or take a break? Yeah, I think Courtney just used a great term there, the pull forward when we talk about this Trump bump. Uh, and it's possible that a lot of the sectors that we expect to do well under this incoming administration, uh, might not be the ones that ultimately end up being in favor the next four

years. So you look at like healthcare, energy, financials, they're having their day in the sun now, but it not necessarily, uh, but those won't necessarily be the ones that are ultimately the winners. But I think, you know, even though logic would dictate that we're probably going to see a little bit of a give back here at some point soon following that Trump bump, I don't know that that necessarily is going to come as quickly as people anticipate. I think that the excitement over deregulation is so high and the expectations are so high right now. If you just look at Bitcoin crossing the $90,000 threshold, for example, I think this is going

to carry for quite some time through the end of this year and probably into early next year. Max, what's your thought? How do you see things? Yeah, good afternoon. I think we're talking perhaps a little bit too much, actually, about the election outcome. And we're not focusing enough on what kind of starting point we're at. You know, just three months ago, bear in mind, three months ago,

we were talking about the breaking of the Sarm rule. We were talking about is the carry trade, is that something systemic? Are we on the verge of a recession? Right. Market we're pricing a 2.8 percent terminal rate. And you fast forward not even three months and we're talking about a 4 percent terminal rate. We're talking again about economic surprises that are much, much stronger, that have been stronger in the last two and a half months about GDP growth that's still around three percent. I think one of the things that are still so underappreciated is these revisions to the national account state and the U.S. I think, you know, real disposable income just happens to be almost a trillion dollars higher than we previously thought. I think we're perhaps giving a little

bit too much credence, a little bit too much going into the nitty gritty around the election outcome and not focusing enough on how strong actually the U.S. is, on what a strong footing the U.S. economy is. And that really should bode well, particularly for U.S. risk assets. It's good for U.S. high yield. It's good for U.S. credit. It's good for U.S. equities. It's good for the cyclicals. But actually, it's slightly independently from that election outcome, I would say. I mean, I hear what you're saying. It goes back to almost what the Greg Ip piece was in the in the journal a couple of weeks back where he he suggested whoever wins the election is going to inherit a very strong economy that doesn't erase the point that what we are thinking about and talking about and what the market's obviously reacting to is the idea of

unleashing the kind of economic growth um and stimulation of of you know, the likes of which which just wasn't going to happen if the election result was different, whether it's the idea of pent up demand and animal spirits in M&A, lowering regulation and the like, and then re-upping tax cuts, which you can argue all you want about the deficit. And those are worthwhile conversations to have. But nonetheless, that's all part of the stew of why I think why people think that there's going to be all this light ahead. Yeah, I do. I do agree with you. I think in certain sectors, which I do like, I still like the banks in the U.S. I do still actually like things like health care, where perhaps we get a bit more deregulation, particularly around drug pricing. So, yeah, it looks really good on some certain sectors. But let's bear in mind, when we've seen yields pick up, when we've seen treasury yields pick up from

sort of the mid of September, that was also the point. It didn't only have to do with the election odds. It also had to do with economic surprises really turning the corner, with recession fears really, really starting to be reduced big time. Bear in mind that we talked about the SOM rule at the beginning of August. We talked about this carry trade. We talked about, you know, the revisions to the payrolls. There's almost one million downward revision to payrolls. And all of a sudden, we're talking about that SOM rule being untriggered again. It's again below that half a percent. So I would argue both sides, whoever had won the election, both sides did really have an appetite to tackle the fiscal deficit. So the fiscal side, it was always going to be very unlikely that that was going to be a source of material headwind.

We now obviously get the rate cuts on top of that. Like you say, we get the deregulation on top of that. We get the rate cuts on top of that. Like you say, we get the deregulation on top of that. We get the fiscal stimulus on top of that. All of that really is, to your point, should be unleashing a bit more animal spirit. Look, the negative about it is there needs to be probably some certain point where higher yields start to bite. However, when we look at what Fed Chair Powell was saying last week, he had the opportunity to push back three times. And he was saying, look, the labor market, it's strong, but we don't care. It's not a source of inflationary pressure right now. We don't care

that growth is stronger. We love it. We're nailing that soft landing. And it doesn't stop us from cutting rates. So for now, I think actually, particularly given the Fed last week, long-end bond yields are probably capped around 4.5%. And that if we just have sideways yields and bond volatility going down, that alone should already be enough for high yield, for credit, for emerging markets, and for the S&P to rally further. Malcolm, it does raise the question, As we see today, the 10-year hitting 445 and the stock market taking a little bit of a pause. To what level is there maybe more feeling of pain

if yields continue to go up? I think that the rules have sort of changed as of November 5th, right? So three months ago in market timing is a long time ago. And so if we just consider the fact that, yes, yields have started to spike until this point, the last four years, that has actually been meaningful in terms of where the stock market started to go. We have rates that are coming down, as we talked about. But I don't know that we can necessarily guarantee that next year is going to continue an easing cycle.

Maybe we get one more cut toward the end of this year and then we have to find out what that actually means for the natural rate going forward. Or maybe we have an incoming administration that uses the bully pulpit to force the Fed to push rates lower than they actually need to go, a la 2019. So I think that a lot is up in the air right now, which is the reason that the markets are responding the way that they are post-election. And we can't discount how much of an impact all of that certainty and then uncertainty is playing out in the markets right now. It's not like everything, Court, has worked so well since the election. Things that are, you know, yield proxies, staples, not great. You like dividend utilities, not great. You do like dividend payers. Are you making the difference between payers versus growers? And if you even like dividend

payers, to what degree are higher yields a problem? Yeah, higher yields, you know, I think that that obviously is going to be a problem just generally speaking with stock markets. And it's something you need to consider where basically yields are telling you that they don't believe Fed has inflation under control. So that's where having some inflation hedges in there is absolutely going to be important. But I think dividends are going to continue to be important. And one thing that is talked about a lot with the new administration is tax cuts. And dividends are paid in after-tax dollars, which is where you can actually see those rise if those tax cuts actually happen. And a lot of those are your cyclical sectors, which also, again, are going to outperform. So that's why I think you want to look at your dividend payers as opposed to your growth sector.

Max, you say to be tactically overweight Asian equities, along with emerging market equities. I mean, we've already raised the tariff issue, but you didn't really defend your position on being overweight Asian equities if we're worried about an increase in tariffs, which seem almost a certainty at this point. The degree to which they have an impact will be argued, of course, right up until and thereafter they're levied. I reference what Nelson Peltz said earlier at Delivering Alpha. He thinks they're going to be used and he thinks they're going to be successful. Yeah, look, most of our Asian equity overweight, the tactical one, is actually on Japanese equities, which I would argue is really not related that much to tariffs. It's much more related to two things. Number one, we had foreign investors

really fleeing Japanese equities in August and in September. So we had the biggest drop in foreign investor flows ever since 2020, right? So we had really the biggest exodus out of Japanese equities since COVID, since the first COVID wave. So investor positioning,

particularly foreign investor positioning, tactically at least, is really a bit on the light side. That should be supporting that kind of tactical overweight stance in Japan. The other one is actually more an extension to the U.S. equity overweight and to probably the main risk that we are fearing. So you guys were just talking about higher yields. At what point does that bite? The problem, of course, for us, I think that is by far the biggest risk for us is really that at some point, perhaps long-end bond yields really do spike higher. The dollar goes higher. And as a result of that, dollar-yen would go probably 160, 165. If you then own Japanese equities, particularly on FX

hedge faces, you get those weaker yen effects through on the earnings strength. That actually is much, much better, I think, for Japanese equities. And it's much more important than the potential tariff impact. All right, Malcolm, one week from today, we'll be talking about NVIDIA because we haven't really talked about the mega caps all that much since the election because many of them haven't done quite as well as a lot of the other stuff that has in this market. What's the what's the what's the risk going in to this stock and the earnings one week from today as it relates to how we think about the mega caps in general? Yes, Scott, you've asked me pretty much throughout this entire year whether I thought the mega cap tech trade was still going to be the thing to lead us higher and higher. And

each time it was a resounding yes for me. And I made the case that until something meaningful happens that comes along and breaks investor psychology, that really makes us forces us to step away from the large cap growth, excuse me, from the large cap tech names, the rest of large cap growth wouldn't have their opportunity to shine. I think that the tariffs that you guys were just talking about being levied against Chinese corporations and all of the other regulations that we're hearing about coming from the incoming administration that will impact the tech sector, specifically the big tech names, I think that this

might be the moment that we turn around and look back at six months from now, where we say that's where the mega cap tech trade was broken. I'm not exactly ready to proclaim that for sure just yet, but I definitely am getting concerned that this might be the place where mega cap tech starts to decelerate and someone else takes up the helm, maybe financials, for example. Court, last point to you. You can react to that, right? As I said, a week from today, we're going to be consumed with NVIDIA. Absolutely.

And I think the biggest risk there is just it has such a high bar, right? I mean, that has been driving the markets. It is in the largest parts of the S&P 500 right now. You're seeing over 30% of the S&P is just your technology companies. And I think that is the concern is if you see this rotation or this broadening happening and other money is going elsewhere, that can bring down the overall indices. I don't think it's ending here yet, but yeah, I just don't think we're going to be throwing money at it. All right. It's good to see you back here. Thanks, Rob. It's Courtney Garcia here on set. Malcolm, Max, we'll talk to you soon. Thanks so much. So Steve Kovach now for

looking at the biggest names moving into the close. Hey, Steve. Hey there, Scott. Yeah, Rivian shares. Look at them. They're climbing after Volkswagen announced it's increasing its planned investment in a joint venture with the electric vehicle maker. The deal is now worth up to $5.8 billion, the automaker said. The first VW models to use Rivian software and electrical architecture are set to arrive as early as 2027.

You see shares up now about 13%. And Rocket Lab shares hit an all- time today after reporting third quarter results. The space infrastructure company posted a 55 percent jump in Q3 revenue from the same period a year ago and announced its first customer for its upcoming neutron vehicle. Shares are up now a whopping 35 and a half percent, Scott. All right. Steve Kovac, thank you very much. We're just getting started here. Up next, top technician Jonathan Krinsky is back. We'll find out why he is watching global markets closely as we head into the new year. He will tell us we're live at the New York Stock Exchange. Of course, they've been up so much. My next guest says U.S. stocks seem to be the only game in town right now. Joining me now, BTIG's Jonathan Krinsky. Welcome back. Does that mean that this rally just continues almost unabated from here until, I don't know, at least election day? I mean, inauguration day, excuse me? Hey, Scott. So, look, I mean, the primary trend for U.S. equities remains constructive.

And I do think, you know, the year probably finishes higher than we are here. The question is the path to get there. And there's a couple, there's three really points that suggest maybe some tactical vulnerability here in the near term. The first is, you know, we're seeing some upside exhaustion signs. Last Wednesday, for instance, we had 27 percent of the S&P 500 make a 52-week high. And this may be a bit counterintuitive because new highs are, while they're bullish in the medium term, of the last 10 times we've seen a surge like that, 8 of 10 times has been

lower 30 days later. So that suggests into December a little bit of weakness. The second point is really the kind of speculative frenzy we've seen post-election. You've seen, you know, surge in crypto and the meme stocks. You had the most amount of NASDAQ OTC volume last week since July. So there's a lot of indication of a bit of speculative frenzy out there that typically coincides with, you know, some tactical froth. And then the third point are the global markets. Now, while the S&P is up about 3.5% since election day, the all-world XUS index is down around 3%. Now, that's pretty much in line, actually, with what we saw during the 2016 election. So if we're looking for the 2016 redo, this is about the time when you want to see global markets start to

participate. That's what happened then you had about a three percent pullback post-election and then they actually started participating the upside with u.s stocks so we think you know the next few days into the next two weeks we'll be telling you know is the is the weakness in global markets um you know just kind of that knee-jerk reaction to the strengthening dollar we've seen over the last couple weeks or is it telling us something a bit more ominous? I mean, it would appear, I think you could make an argument that it would be the former, that the likelihood is the former over the latter.

I think global markets would obviously be responding to what would be a new Trump administration. The fact that, as you said, the dollar has been rallying. You have the prospect of tariffs and other approaches to geopolitical issues that may be far different than prior. That's neither here nor there. The other idea I want you to opine on is maybe what was considered speculative in the past,

like crypto, feels like it has a little more certainty or maybe the most amount of certainty, quote unquote, as much as you can have in those types of assets than it has ever had, because you're going to have an administration that's obviously much more open armed to it. Yeah, I think, you know, Bitcoin for sure, you know, the breakout through 70,000 was compelling that measured around 90,000, which, you know, we've hit that. So I don't think Bitcoin itself is that speculative. But when you talk about some of the meme coins, Dogecoin, for instance, recently had a market cap exceeding Ford. You know, that's a little

more speculative. And I'm specifically referencing Bitcoin. I'm glad you mentioned that because I'm not suggesting that these other coins or whatever necessarily have nearly the upside prospects as a way that the people around this administration have talked about Bitcoin. So let's talk about Bitcoin. Forget the others. Yeah. So, again, Bitcoin, nothing, nothing wrong with that. But again, the acceleration and the move from $70,000 to $90,000, it's been an impressive move for sure. So I think just a little bit of a pause is warranted there. But back to the global markets, again, while the direction has been similar to 2016, the main difference in some of the global markets now versus 2016 is some of their structural patterns. You look at South Korea, for instance, and a big part of that is Samsung, for sure.

But that market, you know, is probing multi-year lows. It's really, you know, been unable to recover after the August volatility. France, look at the CAC. That's, you know, also, you know also testing multi-year uptrend lines. So the structural aspect of some of these global markets is a bit weaker than it was in 2016. Again, we don't want to make too much of it yet because you did have a period of several weeks post that election where global markets needed to find their footing. But again, if they can't find their footing in the next week or two, then you have to ask yourself, is it more of a canary as opposed to just some rotational aspects post the election? Maybe, maybe. I mean, what

looks most technically vulnerable to you between some of the sectors that have really ripped since election, like financials, industrials, we highlighted earlier today on halftime, software, cyber cloud, et cetera? I mean, is there one that jumps out where you say, OK, this looks a little technically stretched or vulnerable? So there's two aspects here. There's there's the parts of the market that have surged that are probably due for a pause consolidation. I would put financials in there. You know, software, actually, we've liked relative to semis. That trade's worked out well. I think the other side of the coin, though, and certainly software now, could be vulnerable

to a bit of profit taking. But look at the relative performance of semis. And you mentioned we have NVIDIA coming up next week, so that'll be telling. But, you know, semis have really not shown any relative strength since the election. And if you look at the semis overlaid with South Korea, those charts have been very correlated over the last two years. And so you have to ask yourself again, is South Korea kind of leading the semis to the downside?

We'll see. But I think those are some areas we're certainly watching here. All right, Jonathan, I've got to bounce. We'll talk to you soon. Jonathan Krinsky, BTIG, because I have some more breaking news out of Washington. Let's go back down to Megan Casella, who has that for us. Megan. More news, Scott. That's right. The president-elect Donald Trump now saying that Florida Congressman Matt Gaetz is his pick for attorney general. This is just coming out just in the last couple of minutes. The president-elect posting on True

Social, his social media platform, that, quote, few issues in America are more important than ending the partisan weaponization of our justice system. He says that Matt Gaetz will, quote, end weaponized government, protect our borders, dismantle criminal organizations and restore Americans badly shattered faith and confidence in the Justice Department. So this is a pick that will put Florida Congressman Gaetz at the top as sort of the nation's top law enforcement officer. And it's installing someone in that position, Scott, that is a diehard Trump loyalist, about as loyal as they come. He's huge in the MAGA movement. He hit the campaign trail with the president-elect this year. He spoke at the RNC in July. And he was on the plane today, according to a source on the plane to NBC News. He was on the president's private plane today when he came to Washington talking with Elon Musk while President-elect Trump was in that meeting with President Biden. So we'll dig into this. But I will say, Scott, that this is definitely a pick that will raise some eyebrows on Capitol Hill. It will have to get Senate confirmed. And of all the picks that we've gotten so far, this is one that we do anticipate lawmakers may be raising some eyebrows and some questions about.

So we will see how that goes. But for now, we know Matt Gaetz is Trump's pick to be his attorney general. Scott. All right, Megan, thank you. Megan Casella back in Washington. We do have more news this time on McDonald's. Kate Rogers has that for us. Hi, Kate.

Hi, Scott. Yeah, we're getting an update here from the CDC on the McDonald's E. coli outbreak tied to slivered onions in its quarter pounders that began last month. The latest tally as of today, 104 cases total. That's 14 new cases, 34 hospitalizations. That is seven new cases of hospitalizations. Deaths remain at one. No additional deaths. States 14 in total. That is one new state, and it's North Carolina. Now, just a reminder for viewers, McDonald's did say several weeks ago that it expected the case count to go up as the CDC did continue its investigation, and it resumed selling those quarter pounders in stores in recent weeks that were impacted but without the slivered onions, as they are believed

to be the source of the E. coli outbreak. And as you can see, the stock is just slightly lower right now. Back over to you. Okay, Rogers, thank you very much for that. Up next, Ed Yardeni is back. Why he says his roaring 20 scenario is getting a big boost. The closing bell's back after this break. Major averages in the green today. Trying to finish that way.

The S&P, the NASDAQ closing in on record highs yet again. Our next guest says the return of animal spirits sets the stage for even more upside in the months ahead. Let's bring in Ed Yardeni, president, Yardeni Research. Good to see you. Welcome. Thank you, Scott. So you think the goalposts really have moved, huh? I do. I think that, you know, John Maynard Keynes came up with the expression animal spirits and the idea is spontaneous optimism. And we did see that in 2016 when Trump was elected and Trump went up point zero. I think we're seeing again in Trump 2.0. I think the markets are excited about tax cuts for corporations as well as for lower income Americans.

So that'll help the consumer sector. I think there's excitement about deregulation. And I think there's even an expectation that some of these geopolitical crises might end sooner rather than later with Trump's diplomatic intervention. So you put that all together and you get a very upbeat scenario. But I was pretty upbeat about things before Trump was elected, because I think we're also seeing a significant rebound in productivity growth. And that's really driving the economy to a large extent over the rest of the decade. I feel like before, you know, on a euphoria scale, if you will, you you were almost at a nine, like feeling like it was getting a little bit out of hand. So has has the prospects

of what this new administration could bring brought that meter down at this point? Because it certainly feels post-election like it's a bit euphoric. And I'm not the one who's used that word. Others have, including Nelson Peltz today. Yeah, you know, I've talked about the possibility of a melt-up scenario. I mean, I keep talking about the roaring 2020s, but I give that a 55 percent probability. I would say 25% to a melt-up. Too much of a good thing. I think the Fed's making a mistake here, lowering interest rates and stimulating an economy that's already doing quite well.

And that could very well spill over into the stock market and create a melt-up. I mean, look, valuation multiples, everybody agrees, are stretched. However, you know, we've had this terrible recession for the past three years that just didn't happen. The most widely anticipated recession of all times didn't happen. It was reasonable to think it might with the Fed raising interest rates the way they did. But if we're not, if we didn't have a recession the past three years, why should we have one over the rest of the decade? And the longer out you can see the economy growing, the more the higher valuations people are willing to pay. So that's what we're

in right now. But yeah, I wouldn't dismiss the possibility of a melt-up scenario. I mean, you're raising your estimates for earnings for both next year and the year after. Are you raising the multiple on the market as well, the price we're willing to pay for those earnings? Yeah. Look, Scott, I've been bullish, but not bullish enough. You know, when the market bottomed in October of 2022, it took us a couple of weeks, but we thought that was the bottom. And a lot of people say that can't be the bottom because the forward PE is 15,

and that's ridiculously high for a bottom. But it turned out that was a bottom. And at that time, I thought, well, maybe we can get up to 20. And people thought that was delusional, and I wasn't delusional enough. It got up to 21, and now we're at 22. So, yeah, I did raise it. I think these valuation multiples can be sustained for a while as long as there's no recession that suddenly brings them down. Going to get a rate cut in December, you think?

I don't know, Scott. You know, I didn't think that they should have done 50 basis points. 25 was enough for me back in September 18th. And I thought it would be none and done after that. But they just won't listen to me. They got their own opinion. And the reality is they did cut by a quarter and looks like they still want to cut by another quarter. But the data just doesn't support that at all.

And by the way, the bond market begs to defer because we've seen the bond yield go up by 75 basis points as they've cut the Fed funds rate by 75 basis points. So my friends, the bond vigilantes are trying to send us a signal. No, Moss, we don't really need the Fed to cut rates. Yeah, it's tricky because some would say, well, the CPI today suggests that it keeps the door perfectly open for them to do that. And if they do one more and then wait, so be it. Right. I mean, what's the big deal if they do another one?

Yeah. Well, look, it depends, you know, what you're looking for in the CPI. You could find trouble there. And, you know, I've been a disinflationist. I've been arguing we'd get down to 2 percent. But on the other hand, the super core inflation, the services, the core services, excluding energy and excluding housing, that's turned out to be kind of sticky in the CPI, right around 4.5%, 4.6%. And Powell is the one who came up with that concept. And now it's suddenly not very important.

But, Scott, to your point, it's not a big deal if they do 25 basis points in December. I would like a nice leisurely bull market for the rest of the decade. Just because I do doesn't mean it's going to happen. And it could be a melt up and the Fed could fuel a melt up. Look, what the bond vigilantes are saying is that we've got stimulative fiscal policy still. It might be more stimulative. And we don't need the Fed to create monetary stimulus because then the risk becomes 2021 all over again that the Fed's fighting, trying to keep unemployment down. And all of a sudden, they get this huge inflation problem as they did in 2022 2023 you do have a 10 000 target for the s&p by the end of the decade so here's to your bull market prediction that we'll talk to you soon thank you very much denny you know denny research up next

we track the biggest movers into this close steve kovac is standing by once again with that hey steve hey scott we got one tech giant down today after announcing layoffs. That name coming up next. We're less than 15 from the closing bell. Back to Steve Kovach now for the stocks that he's watching. Hey, Steve. Hey, Scott. Let's start with Skyworks Solutions. Lower today, down about 4.5% here after posting first quarter guidance that came in below analyst expectations. The semiconductor company also reported a beat on Q4 earnings and revenue that was in line with estimates. And AMD announced that it will lay off roughly 1,000 employees, or about 4% of its global workforce, as competition in the AI chip space heats up. The computer chip maker said the move is part of the company's effort to align resources with the, quote, largest growth

opportunities. Shares at AMD, they're down a little over 2% now, Scott. All right, Steve, appreciate that. Thank you, Steve Kovacs. Still ahead, we'll tell you what's sending JetBlue shares soaring today. There's a stock up near 10% back on the bell after this break. We're now in the Closing Bell Market Zone. CNBC Senior Markets Commentator Mike Santoli here to break down these crucial moments of the trading day. Plus, Kay Rooney with the setup ahead of Cisco earnings in OT. And Phil LeBeau on what has JetBlue shares flying high today. Mike, I'll turn to you first.

So we've gone negative. We're barely hanging on to the doubt. Yes, and it seems like there's a little bit of fatigue you're able to see, and especially parts of the market that really had a headlong sprint from last Tuesday. In fact, the intraday reversals and things like MicroStrategy, Tesla, Goldman Sachs is eight bucks off its morning high. So you started to see some of those momentum leaders that came out of the gate so strong buckle a little bit here. Don't know if that's really decisive. What I found interesting is as that was happening and the indexes were coming in

toward the flat line, the VIX went down to 14 and actually below. It suggests that it's actually sort of the wild upside action that is also juicing the volatility picture. And you're seeing this sort of hunt of heavily shorted stocks throughout the small cap universe. So a lot of this stuff is just a little bit of a lather. We probably have to get through. It doesn't change the overall trend, but I'll be watching as we get another almost 1 percent drop in the Russell 2000. It's basically not up since the day after the election. Yeah, well, yields on the long end up today, maybe putting some pressure there. Kate Rooney, speaking of watching, we will be just that for Cisco and OT. Scott, we are watching Cisco. So if you look at the stock, this is really about expectations are pretty high for Cisco. Stocks up roughly 30 percent since that last report back in August.

And Cisco has been one of these AI beneficiary stocks. Companies said it did see strong customer demand during that last report, despite some of the what they call persistent macro uncertainty. Some of that stock performance, it is thanks to AI and those offerings. In June, companies said it was launching a billion-dollar global investment fund to develop AI solutions. We'll see if we get any sort of update on that. And then analysts have lately been upping their estimates as far as earnings in the past three months or so. Strategist Louis Navalier wrote that consensus for EPS, he says, is up by 11.5 percent,

does expect that positive earnings revision to signal an upwards earnings surprise. So we'll see today. And then earlier this week, JP Morgan upping its price target on Cisco by 11 bucks, wrote in a note that it's watching the recovery cycle and enterprise networking demand, which they say is still in the early stages. Scott, back to you. All right, Kate, thank you. Kate Rooney, Phil LeBeau, tell us about JetBlue. Scott, this is actually a tale of two airline stocks, JetBlue and Spirit. Let's start first off by looking at what both stocks did today. And they went in opposite directions. JetBlue having one of its best years since 2015. In fact, we are on pace for JetBlue's best year since 2015. As you take a look

at shares of JetBlue, keep in mind the reason it's moving higher is because, look, they have 73 direct routes that overlap with Spirit. If Spirit moves closer to bankruptcy, and there was the WSJ report yesterday that they are considering that, does this benefit JetBlue in some fashion? And as you take a look at shares of Spirit, keep in mind, we've seen airlines go towards bankruptcy and ultimately file for bankruptcy. While that may wipe out the shares, it doesn't mean that the airline goes away. It takes a long time for an airline to truly go out of business, even if it does go into bankruptcy. Scott, back to you. I appreciate that, Phil. Thank you, Phil LeBeau.

Back to Mike. A little more than a minute here before this bell is going to ring. What do we have between now, really, and NVIDIA a week from today? There's not a whole heck of a lot to drive this market other than anticipation of next year and a new administration. Yeah, that's what it is. I think it's really about kind of the eye of the beholder on whatever tea leaves you see revealed about maybe the policy stuff, whether the individual moves have to correct a little bit in the immediate reaction. I do think it's interesting today that the indexes did get back into control of some of the mega caps. So they again acting somewhat like defense, somewhat like the neglected

group. Now, that's more like Microsoft and Amazon. It's not NVIDIA today because the overall semi group continues really to struggle here. So I don't think there's a lot that we're going to be talking about headline to headline. Macro is set. You know, I mean, today's CPI, even though it wasn't great as a benign surprise, it was enough that we think we know we get another quarter point and then take it from there. The two-year note yield is not that far below Fed funds right now, suggesting the market is positioned for, you know, meeting by meeting after December. We just don't know. All right, we'll go out mixed, as you can tell here. NASDAQ in the ruffle red. Dow S&P trying to hang green as the bell rings. I'll see you tomorrow.