Closing Bell - Closing Bell Overtime: 12/30/25

Episode Date: December 30, 2025

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

That bell marks the end of regulation. Carnegie Investment Council ringing the closing bell to New York Stock Exchange. American Red Cross doing the honors at the NASDAQ. Stocks modestly lower the Dow and NASDAQ down about a quarter of a percent. The S&P down a little less than that. The Russell 2000 is the underperformer down about three quarters of a percent. Energy and communication services were the leaders, consumer discretionary and financials lag. The action was in commodity.

Silver rebounding 7 percent after posting its worst day. in four years. Copper and platinum with nearly four percent gains, gold higher by about half a percent. Oil, steady, holding below 58 bucks a barrel. Bitcoin trying to find some footing up about a little less than 1 percent today. It was back above 88,000 for a while, but not there right now. The cryptocurrency on pace to end the year down about 6 percent. That's the scorecard on Wall Street, but winners stay late. Welcome to closing about overtime. I'm John Ford. Morgan Brennan is off today. Don't count out a correction.

That's what our market guest says, about a 10% drop possibilities we head into next year. Will that become a downturn at what will drive it, we will discuss? Plus, sunny side up. That's how Bank of America categorizes 2026's economic outlook. We're going to speak with their chief economist about the bullishness. And laggards to leaders. Can some of this year's biggest losers make a comeback next year? We're going to break down some names, perhaps poised,

for a turnaround. But first, let's get more on today's market action with Christina parts of nevertheless. Christina. Well, you just mentioned turnaround. So it's a perfect segue into metals today after yesterday's drop, gold, silver, platinum, all bouncing back. And that lifted mining stocks today like Newmont, Freeport. You can see on your screen, eh, the only one actually in the red. So I wrote this a little bit before. And then Newmont down up close 2% higher. In tech, Intel was a winner on the NASDAQ. The chip maker completed that $5 billion private share sale to Nvidia that we first heard about back in September. It's now official and that helps shares climb almost 2% higher today. But applied digital reversing

course. It initially started higher, closing lower after announcing plans to spin off its cloud computing division and combine it with exobionics. Applied digital will retain roughly 97% of that combined company. You can see shares close 3% lower. Malina Healthcare got a, I guess I could say, an unusual boost from Michael Burry's substack post online calling the health insurer a winning stock pick. Burry says Molina has a clear path to double digit long-term growth and compared it to Warren Buffett's investment in Geico. And last but not least, let's end with shares of Boeing, up half a percent today. Higher after the Pentagon awarded the company an $8.6 billion contract yesterday to provide

dozens of fighter jets to Israel. John? Christina, thanks. Now to the bond market. Rick Santelli is there for us in Chicago. Rick? Yes, you know, it was interesting because the Minutes definitely had a couple wines in there that were interesting, meaning. that many of the members see easing in 2026,

but yet they talked a lot and worried a lot about inflation, which fits exactly with the markets. Let's look at a two day of two year. Couple things to point out. Today we're well below yesterday's low yields, and we're making fresh lows as I speak. Now, look at that 10. The 10 is a completely different animal.

The 10 is coming down now, but it traded well above yesterday's highs, and the pattern is completely. different. And it fits because the two-year is showing easing some point down the road and it's being optimistic, but the long end is sticky. Even though rates are coming down a bit, consider this. Right now is the fourth consecutive lower yield closing a two-year, and it's going to close at the lowest yield since October 22nd. We'll call it two months. But look at the tenure. If the tenure was keeping up with the two-year, it would be under $3.95. But here it is. for 11. And finally, what is that chart really showing you? It's showing you how much the curve is steeping. Right now, 2's 10s is the steepest since January of 22, almost four years. And what does that mean to all you out there that the Fed probably will ease? But it might not help mortgage payments a lot because the steep curve means longer rates are stubbornly high. John Fort,

back to you. Rick, February, I mean, sorry, January, February of 22, that's, That's kind of ominous, no? I mean, that was a rough time for stocks. Oh, absolutely. A rough time for stocks and a rough time for inflation. Some of our worst inflation numbers going back to the 80s were in 2022. All right. Rick Santelli, thank you.

While the Federal Reserve releasing the minutes from its latest meeting, as Rick Santelli was just talking about, showing a highly divisive decision to cut rates earlier this month, Steve Leesman is in Washington with the details. what did you learn well it was a little bit closer than we thought and and i really want to pick up on what rick was saying is excellent announced how the market reacted let me give you the verbiage that was part of the market reaction here which is if you go down three main points i think to take away from the meeting one some who voted for that cut could have supported a pause they

could have gone either way so it was a little bit closer than the nine to two to one which was nine, four, two against, and one for a 50 base point cut, then that suggested. Most did see further cuts as appropriate if inflation declined as expected, and yet a little contradictory to the next line, some wanted to keep rates unchanged for some time. And John, the way I put all this together, I think the way to think about it is, the Fed in general, most people on the Fed see the trajectory of rates being down, but there's a debate about the timing. The Fed, some at the Fed feel they've given an awful lot. So for 175 basis points over the past two years,

let's see how that works and let's see what happened with inflation before committing to additional cuts. That's how I square those different ideas or attention on the committee right now. So how malleable is your sense of how the committee is? I mean, given that in 2026, we're going to have a new Fed chair, one who, at least the president expects, is going to be much more amenable to lower rates. What about the rest of the committee?

Well, the word malleable is an interesting one because that's really one of the questions the market has to deal with, which is how independent is the next Fed chair going to be relative to the president? How much will the president dictate policy? And then how does the market react? How much concern does the market show with that? We do have a new Fed board coming in. Five new presidents will be voting. And of course, there's a lot of uncertainty, John, about the actual makeup. There's the Lisa Cook Supreme Court hearings in January. January. If she keeps her job, she'll stay. And also a question as to whether or not Fed Chair Jay Powell, who will end his term as chair, but maintain a two-year term as governor, whether or not he stays on and keeps that term as governor. Are we talking about that more later this week? But that's a big question. So there's a lot to talk about in terms of policy, which that could be cleared up, John, with the data, but also some questions about the personnel and their relationship to the administration. You think Powell stays? Arguably the heat would be off. I'm thinking long and hard about what Powell might do and why he might do it, John, and I'm not

ready to tell you what I think about that because I have a lot of people left to talk to about this issue, but it is a very, very important issue for the market. I think it's also important for the administration because they want to know, do they have a governorship to fill or not. I love it. The reporting cake is not yet baked, so you're not serving it. Steve Leesman, thank you. Well, we'll put it. Thank you. Well, with tomorrow marking the final trading day of 2025, our next guest says economic growth could stay resilient in the new year, powered in part by ongoing investment in AI infrastructure. Joining me now is Wealth Enhancement Group Portfolio Consulting Director, Aya Yoshikoa, sorry, with $128.8 billion in assets under management.

I are welcome. So tell me, the economic growth you expect is going to remain strong into 2026. But why does that mean that equities remain strong, given that valuations are at such historic highs? Hi, John. Happy holidays to you. So, you know, the last few years, we've seen, you know, really strong market returns, right? Double-digit returns. And, you know, going back to 2023, a good portion of that came from multiple expansion. Well, as we look at 2025, you know, 80% of the returns that we've seen out of the 17.5% returns in the S&P 500 this year, that's largely come from earnings growth. And so we expect that to continue in 2026. And we

don't expect much in terms of the multiple expansion in 2026. It's already at elevated levels. It's really difficult to argue for, you know, more in terms of the multiple expansion. multiple there. So we had a little fan service on CNBC last hour. I don't know if you caught it. Mike Santoli's mystery broker was finally revealed. I want to read you a little bit of what he said. Within two years, this is all going to end. He said people that want to see a broadening in the market, be careful what you wish for because in the past, it has always been painful for the entire market. Your thoughts? Sure. So, you know, we've seen some.

such concentration in markets and a lot of this concentration has been given to the, you know, leaders that have had strong balance sheets, high quality names with really strong growth. And so, you know, we want to see the broadening out because we don't want to see the market being driven by just seven names. But we do want to see the overall market being a reflection of the overall economy and that broadening out being reflected in markets. So I hope it doesn't end. And I hope it doesn't end poorly for the Mag 7. I hope it continues with the S&P 500 hitting new highs in 26. My impression, Aya, is that this market is leaning hard on big stocks, leaning hard on equities, and leaning hard on this retail investor mindset that has been willing to buy the dips

with April of this year being a prime example. How much is that culture or stance going to be tested you expect in 2026. How much volatility does it leave room for, given the levels of margin and options activity that retail investors have taken on? Absolutely. And, you know, Mike Santoli touched on this a little bit. It is a midterm election year in 26, and the averages aren't too kind. I think we're in that sort of mid-single-digit returns when you look at the averages. And it might seem a little disappointing in 2026 to have. a six, seven, eight percent return after being spoiled for three years in a row of 15 plus percent returns. So we'll have to see. We do think structurally that retail investor is still invested

and wants to, you know, find those winners. And it's going to be sort of imperative that there is a little bit of that active management going on structurally in markets relative to all the passive inflows that continue to happen in markets. How much are we sort of leveraged to the attitude about AI infrastructure spending. It's not just about the big tech names anymore. We're talking about utilities. We're talking about construction equipment companies, all getting some sort of a lift off of the hopes of this, not just existing plans, but continued expansion in AI data center spending. Absolutely. In terms of the AI, you know, thematic, we did get that broadening out of all the picks and shovels related to AI. But we need to,

to see sort of that continue. And I think investors are really afraid of two things. One, deceleration in that growth rate. So it would impact all of those areas of AI. And this being the increase of debt used to fund that growth. So I think those are the two things that we're all really monitoring as we go into 2026. All right. We will continue to, Aya Yoshioca. Thank you. Thanks, John. Well, the aphleisure trade getting absolutely crushed this year. Up next, a top retail expert on what's behind that fallout and whether Nike, Lulu Lemon, and Under Armour can stage a comeback in 2026. And later, Surat Setti is here to reveal the two beaten down Dow stocks that could be diamonds in the rough for your portfolio in

2026. Over time. Be right back. Welcome back to overtime. Lulu Lemon founder, Chip Wilson, ramped up his battle to get the company back on the right path, he says, launching a proxy fight yesterday. You can see why Lulu Lemon shares have been crushed this year, down nearly 45%, but it doesn't appear to be an only Lulu problem. Under Armour, Adidas, Nike, also suffering steep losses in 2025. Joining me now is Jan Niffin, CEO at J. Rogers Niffin, WWE. Good to see. It's been a while, Jan.

So, I mean, how can everybody in the space be losing at the same time? Doesn't somebody have to win? Well, no, somebody doesn't have to win. there will be some winners. But remember, it wasn't a Lulu Lemon Christmas. It wasn't an Athleisure Christmas. It was a Ralph Lauren Christmas. So people bought real clothes instead of athlete and workout clothes at pace they haven't done before. It's kind of the backlash on everything we saw happened during COVID, right, where everybody only wore atleisure or less. And now we're switching back and we're buying real clothes and we're buying Western wear still.

So that's sort of filling up that space. So it's a little tougher right now if you happen to be in that at leisure area. Well, I mean, that lines up with that quarter zip trend. I keep hearing the Youngs talking about. They're not just wearing the Nike techs anymore when they want to show they're serious. They got the quarter zip on. But, I mean, just in the core business of even just shoes, right? We see Nike in trouble.

Under Armour loses stuff, Kari. They're not doing well. Adidas had that whole Kanye thing. I mean, it seems like there's a lot of share out there for somebody. Do people just not need shoes anymore? Well, come on, you know, from the, I've been an endurance athlete on my life. From 1975 to not that long ago, I wore nothing but Nike head to toe. Now I wear nothing but on running head to toe.

On running didn't even exist. Under Armour didn't exist. So Hoka didn't exist. The two fastest growing things recently have been Hoka and then on, which was even faster running. faster growing. So if you look at all of that, you say, well, it's a tougher space, right? Is Nike going to turn around? Yes, they are. They've already started. They're doing the right things. It's going to happen. The problem they have right now is DTC in China. DTC will get fixed. China, we don't know yet. And people will be much more enthusiastic when it does get fixed. So they'll start

taking up a lot of airspace again. That's going to be hard for Under Armour. But yeah, there's players, just like there is against Lulu in that space, well, we've got a dozen names playing against Lulu. We've got Alawyoga, we've got Vauri. Nike, of course, does. Adidas, Athletics, gym, shark, sweaty, betty, you name it. They're in that space. Well, the same thing has happened in the men's athletic area, where Under Armour's always really played. It's just a much tougher environment, and there's less interest. I mean, Jen, if Nike's coming back, then boy, Nike had $61 a share. That's around where it was Halloween 2015 more than 10 years ago. What are going to be the key signs that the comeback has really taken hold, do you think? Well, you have to believe

that the new product is going to work. I just bought a pair of the Merrill. So yes, do I think it's going to work? I think they're coming back with the new pipeline. I think that'll work. I think a reinvigorated foot locker will help them a lot. I think Dick's sporting goods, which is it going to be a huge seller of the new Nike product will be a big help. But I think moving them back into the channel of the independent sellers will help them a lot too. I just think they lost their way. And I think now Elliot's got them back on the right track, right? So I think they're moving in the right direction. They've got other things to overcome. Like I said, they can't fix China. China has to help them fix China. But the rest of it, they can fix themselves. And that's probably

going to be enough if you're an investor. Is anybody really poised to steal Nike's cool? I know you mentioned hoax and on running and no disrespect to people our age. I'm going to say our age, Jan. How about that? But we're not the arbiters of cool. And I, those youngs with the quarter zips, I don't see them doing hoax and on running. I mean, unless they are really avid marathoners, which most of the youngs are not, I don't see it happening. So are they going to, is on going to have a Just Do It campaign in the next Michael Jordan, you've got to convince me. Okay, you're half my age, but I'm still going to take that as a compliment. There you go.

And I'm going to tell you, yes, in fact, it's going to see Nike come back like Nike used to be, where people knock around with it when they're going to high school and they're knocking around them in college, and they're not always running in them. We're going to see that reformation. We will still see pressure from specialty people who do a good job. We did see that from Under Armour when they were all working. Remember, they put a lot of pressure on Nike. The young customer started wearing that product.

So there will always be somebody new stepping in, but Nike's name is so good. And they own that space from the point of view of the space between your ears. So the customer knows them well. If they get it right, they'll make it work, and I believe they're getting it right. Lulu is not yet getting it right. They haven't even started getting it right. They have 18 to 24 months to get it right, but they have to start first. All right.

Don't let the bald head fool you. I'm about 50, Jan. But you're looking good. Yeah, and I'm twice your age, like I said. Jan Niffin, thank you. Well, Meta making a late-night deal to acquire a startup at hopes is going to help satisfy investors that are maybe unhappy about all this spending on AI, details straight ahead. Plus, real estate has been the worst performing sector on Wall Street this year.

We're going to look at whether both the commercial real estate and residential housing markets can rebound in 2026. That's coming up on overtime. Welcome back to overtime. Metta's closing out 2025 with the 11th hour acquisition. The company announcing it's buying Manus, a Singapore startup that builds AI agents. Mackenzie Sagalos has some details. McKenzie. Hey, John. So Meta reportedly paying around $2 billion for Manus, a startup founded in China, now headquartered in Singapore,

that builds general purpose AI agents. agents. Meta's business services line already pulls in $10 billion a year, bolt on agenda capabilities, and maybe Meta finally gets some ROI on its AI spent, and for a price tag that's paid for itself many times over just in today's trade. Now, this deal tells you everything about how CEO Mark Zuckerberg is steering the ship. He controls 60% of the company, can make these bets without much pushback, and he's proven he's not afraid to buy his way to growth. Instagram, WhatsApp, Oculus, even the scale AI deal earlier this year. It was an aquire, not acquisition, but he got the firepower and brains behind that company.

And with Meta's own models still lagging in real usage, Manus reads as a shortcut to traction, something that Meta couldn't build fast enough on its own. AI Chief Alexander Wang also planning to weave Manus into Meta's broader product stack, and with roughly 3 billion daily users, Meta has a distribution to push it from a business tool into a consumer habit. John? This is an interesting one because I believe around mid-year, soon after it actually debuted, this company moved from China to Singapore. It's got workers in Tokyo, et cetera. I mean, a lot of the workers on every AI project, everywhere in the

world, are Chinese. But it seems like this company, Manus, specifically positioned itself for this kind of partnership and possibility, perhaps with the knowledge that if they had stayed operating based in China, this might not have been so possible. It's such an excellent point. Benchmark, when they made an investment in the company, caught flack for that. And so then you saw the headquarters shift, as you noted, laying off staff in the mainland, deprioritizing, offering its product to China, Chinese users. And on top of that, running on Anthropics models to really try to distance itself from any sort of perception,

despite the fact that its founders are from China. And its cap table includes names like Tencent and Chinese VCs. Yeah, founders of a lot of American tech. companies are from China as well. I'm McKenzie. Thank you. Well, time for a CNBC News update with Christina Pards and Elvis. Christina. John, a newly unsealed order in the criminal case of

Kilmar Ombrego, Garcia, reveals the Justice Department pushed to prosecute him even after he was mistakenly deported. The court documents suggest DOJ officials called his indictment a, quote, top priority only after he was sent to El Salvador and then ordered return to the United States. Abrago Garcia has pleaded not guilty to human

smuggling in federal court and is seeking to have his case dismissed on the grounds of vindictive prosecution. Tatiana Schlossberg, the journalist and author who was a granddaughter of John F. Kennedy has died. She was 35 years old. Schlaasberg shared in the New Yorker in November that she was diagnosed with cancer when she gave birth to her second child just in 2024. And electricity prices are forecast to rise in the New Year. The Federal Energy Information Administration expects to see residential prices go up about 4% in 2020. after climbing nearly 5% in 2025. Rising utility bills were a flashpoint in this year's gubernatorial races in New Jersey as well as Virginia

and are expected to remain a factor in the upcoming midterm elections. John? All right, Christina, thank you. Well, sunny side up. That's our next guest's view of the economy for next year. We're going to get his top economic tailwinds for 2026 straight ahead. And speaking of food, are we? Yes, eggs. Humans and robots could soon be teaming up to prepare meals at your favorite fast, casual restaurants.

But will AI help serve up gains for investors? Maybe some answers coming up on overtime. Welcome back to overtime. Today's Fed Minute showing the most descents in six years at the latest FOMC meeting, but noting the economy would grow next year. Our next guest agrees saying it'll be a sunny side-up economy in 2026 with five key tailwinds. Joining me now is Aditya Bave, senior U.S. economist at Bank of America. Aditya, welcome.

So what happens to concerns about a case-shaped economy in 2026 and this theme of affordability in the political discourse? Thank you. Good evening. So let's start by talking about our forecast for next year. As you noted, we're quite optimistic. Five tailwinds. What are they first fiscal policy? We think the stimulus from the big, beautiful bill for CAPEX, for consumers, adds three

to four-tenths to GDP growth next year. Second, the lagged effect of Fed cut, so that's monetary stimulus. Third, we think the AI-related tailwind should continue next year. Fourth, we think trade policy is going to be more supportive for growth next year than this year, and that's true regardless of what happens with the AIPA tariffs in the Supreme Court. And then fifth, the base effects from the shutdown should also be helpful for growth next year. So what happens to the case-shaped economy. Our base case is that the lower part of the case, a lower income spending, stabilizes supported by upper income spending, which should eventually put a floor under the job market. So is it still a K?

It's a K, but it's not the kind of K that one would be really worried about. So there's different types of K's, right? What's the most worrying type of K? The most worrying K is one in which upper income spending is just about holding on, and lower income spending is outright weak. What we're seeing in our card data by contrast is that lower income spending is holding on, whereas higher income spending is outright strong. So it is a K, but it's not the most worrying kind of K. And we think that eventually, if this continues, higher income folks, they tend to spend more on services. And that should mean that eventually this is a very blue-collar service-driven economy.

And eventually, that should help stabilize the labor market, as I mentioned earlier. Yeah, it sounds like so much does depend on the labor market. how much does the labor market depend on interest rates continuing to come down and not just hold steady? It helps. So the cuts that the Fed have done help a certain degree. The other thing that we find quite encouraging is there's obviously this chicken and egg relationship between the labor market and the consumer over extended periods of time. But what we found is that it's typically consumer spending that leads jobs rather than vice versa.

So the stability, I would say perhaps more than stability, resilience in consumer spending that we've seen over the last few months, I think bodes quite well for the labor market going forward. Now, again, we're not talking about a significant acceleration, but we're talking about a world in which the unemployment rate stabilizes around where it is now and then eventually starts dropping in the back half of next year. Is consumer sentiment going to shift and does it have to? It doesn't have to. I don't know if it's going to shift. It's difficult to predict how people feel. Obviously, sentiment has been disconnected from consumer spending for the last four years, which is why I'm saying it doesn't really have to shift. We've had an extended period of weak consumer spending with, sorry, strong consumer spending with weak consumer sentiment. So that could continue for a while. There's other reasons for consumer, weak consumer sentiment likely related to the the cumulative increase in prices of price levels rather than just inflation over the last year and also political polarization might be making things worse. Speaking of which we got midterms, how does that enter into your picture in all of the talk about affordability?

It's obviously a big point of focus. We think that the incentives for the midterms probably lean this administration towards being more favorable for growth on trade. policy over the next year, which is why I said, look, if the tariffs don't get overturned, then we think the administration will move very quickly towards delivering good news on trade. Perhaps a deal with China to bring down the fentanyl tariffs, perhaps a renewal of the USMCA, but we think the administration will certainly be focused on delivering good news for the stock market and for the economy on trade policy.

All right, Aditya Bave, thank you, in the back of America's securities. Up next, Sarat SETI unveils his bargain hunting list for 2026, including this mystery mag-7 name that's been underperforming its peers and the broader market. Plus, home prices rising more than expected in October. Zillow's senior economist discusses whether a rebound is underway. That's coming up on overtime. Welcome back to overtime. Yes, the markets are on pace to close out the year with huge gains, but there were some real underperformers. Can some of this year's biggest losers turn it around?

in 2026. Well, joining me now is Surat SETI. He is managing director at DCLA and a CNBC contributor. Hey, Sarat, let's start with United Health, down 35% this year. The worst Dow performer. Anything in the trends around utilization or anything going to change the story next year? I really think there's some regulatory headwinds here that we have to get through. Margins have come down. So the company really is to kind of stabilize. I've got a new CEO in there. This one will take some time. I think, you know, expectations were really high. This was the premier company trades at 19 times earnings. So I do think this will take me a workaround similar to if you have patients like people did with CVS. So

this is more of an execution story and a regulatory overhang. Coming at second for the worst stock in the Dow is Salesforce down 20% for the year and the S&P was up like 17. It started to see a rebound lately up 15% this month. But software is in general has been kind of out of favor. Can Salesforce buck that trend or as software goes, so goes Salesforce? I'm more excited about this one, John. I think the story here is that initially investors thought AI was going to eat the software companies for lunch. We think that's a different story. We think AI is actually going to enhance and help companies like Salesforce. Really what investors were looking for were substack growth. We think that's going to come

And we think a company like sales force is going to be a lot more efficient. And the recurring revenue nature of this business, that's something they're not getting credit for. It's trading it 16 times cash. John, it hasn't traded this low in many years. And we do think this is a company you want to own going into the next few months. Another challenging story in 2025 is Amazon. Yeah, it's up around 6% this year. But it's underperforming the others in the Mag 7.

So, does the story remain the same for Amazon, or do investors have to measure it differently, perhaps, in 26? You know, interestingly enough, Amazon, just take it on an evaluation metrics, is now trading in 12 and half times cash flow historically 15. But look at the tailwinds behind Amazon. Firstly, it benefits whether any part of the case-shaped retail economy. Secondly, AWS is doing really well. And then it's got other things like, you know, robotics that are getting, you're not getting any, credit for. And if you look at the Tesla, it's getting a lot of credit for robotics. Robotics at a company like Amazon is really going to enhance margins and help them grow and

be a lot more efficient. Add that advertising video. There are a lot of legs here for Amazon. And I think given the amount of focus on the other MagS, this has been underappreciated, underowned. And I think this is another one that we really like and want to own into the next few months. So on a big part of the Amazon story, of course, is AWS. And a big part of the the AWS story is the custom silicon that they're working on. Projects like Rainier, the idea that they think they can do AI more efficiently for customers over time than some of their competitors can. Do investors start to see a payout for that in 26, or do they have to wait longer,

you think? I think you're going to see it pretty soon. I mean, they're investing a lot internally. They also don't have to use the most enhanced chips of Nvidia. So if you think about where they need to be, I think they're at a big advantage. They're spending money in R&D, they're in these other areas, and they're all going to have this synergy effect that some of the other Macsix don't really have. So there's nobody out there that can replace Amazon. Yes, you've got Walmart.com on the retail side, and you've got Google on the AWS side.

But if you take this company as a whole, I think the sum of the parts is worth a lot more. And once they get everything working together, John, I think this 12 and a half is going to move up. And in addition, the earnings growth are going to move up. So I do think Amazon out of all the six, all the seven is in the best place. So in a way, if the go-go excitement about debt and spending in infrastructure cools off and the attention turns to value, perhaps Amazon has a different sort of story to tell. Completely. And if you've looked at Amazon historically, especially over the last three, five years, they have a lot of levers, right? They can cut back on cap-x and still be cash flow positive. They can increase spend in other areas that they think are going to be benefits. to their customers and to their investors.

So out of all of them, if you think about all the arrows they have, I think they have the best opportunity going into the next couple of years. Well, watch it with you. Surat, thank you. Thank you, John. Happy new year. Happy new year. Well, we'll lower interest rates help revive the struggling housing market,

and if so, what areas of the country could see the biggest comeback? Zillow's senior economist is going to wait in next when overtime is back in two. It's been a rough year. for commercial real estate. It's the worst performing sector on Wall Street. Diana Ollick looks at the outlook and whether it gets brighter in 2026 in this week's property plan. Well, John, CRE leaders are actually slightly less optimistic than they were ahead of 2025. That according to a survey from Deloitte, 83% of respondents said they expect their revenues to improve by the end of 2026, that compared with 88% last year. And fewer respondents said they

plan to increase spending. Sixty-eight percent said they anticipate higher expenses next year as well. So let's drill down on specific sectors, starting with office, which seems to have bottomed. Vacancy rates are expected to drop below 18 percent as more tenants return to the market, according to Colliers. There will continue to be a flight to quality, as Class A buildings in many markets are now almost fully occupied. Office construction is also at its lowest level in over three decades, according to Yardy. In multifamily, Rents are starting to ease as a record level of new supply continues to make it through the pipeline. Multifamily has led investment sales volume since 2015, and there are no signs of this changing,

but its share of total volume is expected to ease somewhat as investors allocate more capital to other sectors like office, data centers and retail, according to Colliers. And speaking of data centers, of course, Deloitte called this sector a clear bright spot in the U.S. commercial real estate landscape. It pointed to nine major global markets where 100% of the new construction pipeline is already fully pre-leased. Now, data centers do face some headwinds in financing, grid capacity, zoning, and local politics. Now, for the outlook on more sectors, we have it all in the Property Play newsletter. Just go to CNBC.com forward slash property play. All right. Diana Oleg, thank you.

So if there's less optimist in commercial real estate, what are the prospects for the residential housing market? Joining me now is Zillow's senior economist Orfe de Venge. Orfe, welcome. How much is the possibility there that this sort of deadlock in the residential market break somehow where folks have low incentive to sell their homes because the interest rate's great. They've got all this equity and no place to trade up to. And it's really not affordable for new buyers.

Yeah, look, we've been bouncing along the bottom for the past two years. But I think in 2026, we're on track to see more balanced pace of activity. You know, our base case at Zillow is for 2026 to be the year of balance, essentially more stability in the housing market. Why? Well, you know, affordability is already at a three-year best and could continue to improve slightly in 20206. We also expect to see incomes continue to grow slightly faster than housing costs. along with that, we'll see lower rate volatility. And as long as the labor market holds together,

we should see both a return of some sellers and also potential buyers to the housing market. But inventory is going to stay pretty low, no? See, our forecast is for new listings to increase roughly 4% and sales to increase around 4% to 5% as well. Part of that is, you know, you mentioned sellers being locked. Well, you know, the peak of kind of that rate lock was 2022, where roughly 90% of sellers had a mortgage rate below 6%.

That's come down significantly. We're around 80, 83% now. And so, you know, in 2024, we saw a new listings increase roughly 7%. In 25, we saw new listings increase about 4%. So sellers are coming back to that housing market. And in markets where you have more housing inventory, I expect to see a little bit more sales activity. So we're forecasting for a modest increase in sales in 2026.

And so that should be good news for most of us in the housing market. Orfe, how real is the Airbnb effect? And I mean it in the sense that it's easier than it used to be for a homeowner not to have to sell that home when they move. They can continue to hold on to it, manage it in part through technology, not have to worry so much about the cost being enormous on that. Has that really led to people holding onto properties that would have turned over in the past? Yeah, I mean, that's a good question. I don't really track the Airbnb so much, but I'll tell you what's going on with. In 2025, we saw home values decline in 24 of the 50 largest markets, right? So sellers were facing more competition

as inventory increased, right? And so, you know, some sellers, you know, maybe even delisted their homes, right, instead of selling them. But in 2026, that number, the number of markets seeing home values decline should actually shrink to just 12. We know with inventory stabilizing next year, we see fewer markets experiencing home value declines.

Sellers should be in a pretty good position. And ultimately, the majority of homes have seen their value increase since their last sale. You think we're going to see the age of first-time buyers drop again? Yeah, affordability remains a major challenge, right? But we're seeing affordability improve. And our forecast for rates to come down slightly, right? We should eat from about 6.2% now to about 6% in 2026.

You know, that should help potential homebuyers that are sitting on the sidelines. At the same time, rents easing has really helped those potential homebuyers. Remember, potential homebuyers, most of them are renters, especially first-time buyers. And so with the easing of rents combined with a sustained increase in incomes, right, with incomes outpacing housing costs, affordability is improving, right? And so that ought to bring back some buyers into the housing market next year. Yeah.

I mean, you've got to save up for that down payment somehow. and it's been tough out there for so many potential first-time buyers. Yeah, that's right. And if you look at the stock market, right, you look at the stock market. Stock market gains. Stock market continues to increase. The SNP firearms are, what, 17% or so this year? Exactly.

Right? Yeah. So that's helpful. That's helpful to help improve affordability. Got to leave it there. Orfe devengee from Zillow. Thank you. Well, robots at the restaurants, an inside look at how AI is making its way into your lunch hour.

And don't forget, you can catch us on the go by following the closing about Overtime podcast on your favorite podcast app. Be right back. Welcome back to overtime. AI peddlers want to touch every corner of the economy, and your favorite restaurant is no exception. Kate Rogers is looking at how AI robots might soon help prepare your meal. Kate? Hey, John, we got a front row seat to see how you might see AI turning up at your favorite restaurant brands in the future, not replacing workers, but speeding up their production instead. Hyphen, which is headquartered in San Jose, raised $25 million last quarter in a series B that included Kava,

and that adds to prior funding from Chipotle to help scale its automated make line. The tech combines advanced robotics with AI to speed up service times and free up workers to focus on hospitality. Heifen CEO Stephen Klein says customers likely wouldn't even notice the technology because it's conveniently hidden underneath the make line countertop. We're probably making a bowl every 10 to 15 seconds peak throughput. We have more capacity than, you know, usually they do demand, especially like, you know, for lunch and dinner rushes, we're definitely relieving that kind of bottleneck. To me, what's been fascinating is to see companies who are really competitors in the same category, both putting money into testing the tech.

And I asked Klein specifically about that. He said it's clear that both Kava, Chipotle, and others in the space see the challenges. And as he said, bottlenecks in labor. And they're recognizing ways that AI and robotics can help solve for that but not replace humans, making it what he calls a better experience all around, John. Back over to you. By nature, Kate, I'm a little skeptical, especially for these places that have made such a business and experience out of seeing your food made. And people are going, oh, a little less of that, a little more of that. I mean, it's got to be pretty fast computing an AI for the AI to actually pick up on, oh, by the way, no guacamole, and a little bit more cheese.

So to that point, this kind of will prep the bowl or salad, but then the person can customize it for you. So it's taking out some of those initial steps, getting the portion size right, so there's less food waste, and then allowing a worker to customize it on top. So it's speeding up that process, as you said, but not necessarily making the entire thing just yet. Maybe in the future we could see something like that happen. Yes. And of course they want to say that they won't replace human workers, but of course they want to replace human workers. but of course they want to replace human workers.

Thank you. Thank you. Well, we're looking at the markets today, and it was, there were some slight movements. Nothing too dramatic. Both the Dow and the S&P did end lower, but not by that much. The NASDAQ down by about a quarter percent. The small cap stocks, the Russell, fared the worst of all. But we also saw some rebounds.

Precious metals did far better today than. they did yesterday. So heading into the end of the year, the volatility, at least little bits, little moves certainly continue. That's going to do it for overtime.