Closing Bell - Closing Bell Overtime: Affirm CEO On Consumer Health; Tech Labor Landscape 7/2/25

Episode Date: July 2, 2025

S&P 500 closed at a record high today. Our Kristina Partsinevelos tracks key stock movers, while Rick Santelli breaks down action in the bond market. Scott Wren of Wells Fargo and Adam Crisafulli of Vital Knowledge weigh in on where the second half of the year could be headed. Big Technology’s Alex Kantrowitz reacts to Microsoft’s plan to cut 9,000 jobs and what is says about broader tech labor landscape. Affirm CEO Max Levchin joins to discuss what he’s seeing from consumers and payment trends Tim Seymour makes the case for getting bullish on health care.

Well that's the end of regulation. Representatives of the state of Alaska along with Prosper, Aligned, and Vidant, asset management ringing the closing bell at the New York Stock Exchange. Yong Biotech doing the honors at the NASDAQ. Stocks ending the day mixed as investors weighed weaker than expected labor data against progress on trade talks. The Russell 2000 was a standout today, up more than 2% this week so far, but the S&P did hit another all-time high in trading today.

You can see finishing up about half a percent. Energy and tech were leading sectors, but materials not far behind. Healthcare, utilities, consumer staples, those lagged. Oil closing higher by more than 3% as geopolitics outweighed a surprise building US crude inventories. Iran saying that it suspended cooperation

with the UN nuclear watchdog. Plus, reports today that mines were loaded onto Iranian vessels last month. The dollar gaining some momentum midday before falling back into negative territory. The greenback hit the lowest level since 2022 in yesterday's trading, actually falling below the DXY, a key technical level.

That is the scorecard on Wall Street. But winners stay late. They do, that's why we're here. Welcome to Closing Bell Overtime. I'm John Fort alongside Morgan Brennan. Coming up, Microsoft's gonna cut 9,000 jobs across the company in different units, different regions.

We're gonna look at what that could be saying about the changing landscape in tech. Plus, we will be joined by a firm CEO, Max Levchin. What is he seeing from the consumer right now? And we'll take a close look at the parts of the budget bill that will directly impact high earners and investors. Let's begin this hour with a check on both the stock and bond markets.

Christina Parts-Nevelis and Rick Santelli join us. Christina has a look at today's biggest movers, and that is where we will start, Christina. Well, let's start with Santin, because it really led the S&P 500 lower by a wide margin, posting its worst day on record after the managed care insurer withdrew its 2025 guidance and warned of a significant earnings shortfall. The Medicaid focused company's warnings really sent shockwaves through the sector with Molina

as well as the Elevants also closing in the red. You can see Molina down almost 22%. But on the flip side, solar stocks provided some relief. First Solar led the S&P 500 higher after Congress dropped a proposed tax on solar projects from the latest Senate spending bill. The solar sector has really just been whipsawed by congressional negotiations.

But today's news, we can say provided a welcome boost. You can see First Solar up almost 5%, closing 5%. Meanwhile, Bitcoin continuing its relentless climb pushing well past $109,000 up more than what 2% week to date. This rally really got fresh fuel from news that public companies bought more Bitcoin than ETFs in the last quarter. Crypto miners celebrated with double digit gains including Marathon Digital you can see up 13%,, Hut 8 another example up to 14 percent and last but not least in chips the VanEck semiconductor ETF we often use that it's good barometer for the space on pace

for its sixth straight weekly gain the longest streak since August 2022 Taiwan Semi really leading the charge right now while Intel really continues to struggle as reports suggest the company is reconsidering its founder strategy for external customers and that's why you're seeing such a divergence between both of those names guys. That is a big story Christina thank you. Now let's get to the bond market after we got a weak ADP report ahead of tomorrow's government employment data a bit early for the 4th of July Rick Santelli is at the CME Rick Yes, John, you know that minus 33,000 for ADP was definitely a bit weaker than many of us expected And when you look at the chart weakest levels since March of 23 and by looking at that chart

You could understand on a holiday short and weak investors are a little nervous Her small business cutting back because of tariff issues, supply chain issues, AI issues, or is this a fluke? We really don't know because the real story is how this will give you clues about tomorrow. Look at the 2s 10s spread. And the reason I picked the 2s 10s spread and it's steepened is because the two-year note yield is rather stagnant. Right now it's virtually unchanged where a 10-year yield is up for basis points

So the 10-year outrunning twos that is very important That's the dynamic of the Fed weak employment to your yields don't keep up with long-dated yields Which are paying attention to a variety of issues whether it's uncertainty whether it's inflation Whether it's debt deficits or the big beautiful bill Whether it's inflation whether it's debt deficits or the big beautiful bill Maybe all of the above and look at Fed funds look at them for two days yesterday Jolts look pretty good fed funds go down and ply less easing today weaker labor boom fed funds go back up It's kind of a wash, but Fed fund futures are at rather lofty levels So they have started to build in more potential easing. And finally, this

is a one week of the dollar and we expressed it at the beginning of the show. The dollar is going to close at the weakest level since Feb of 22. However, the last couple days, especially with long dated rates moving higher, it has stabilized the dollar albeit at three and a half year lows. Christina and the gang, back to you. Alright, Rick Santelli, I'll take it, thank you. Despite the weak ADP jobs report, the S&P 500 and the NASDAQ did hit all time highs today as investors focused on progress on the trade front

with the president announcing a trade framework with Vietnam. So let's bring in Scott Renn of Wells Fargo Investment Institute and Adam Crisafulli of Vital Knowledge. Great to have you both here. And Adam, I'm going to kick this conversation off with you because we're two days into the new quarter and we're two days into the unwind of the momentum trade that helps power the second quarter. Does that continue?

I mean, so far it looks like it was confined mostly yesterday. You saw a decent rebound in tech today. So we'll have to see if it continues. You know, I think people are watching very closely some of the big macro themes like you just mentioned with trade. We got one deal today, the details of which I think if they show up in a lot of the other agreements won't be received all that well by investors. You know, 20% tariff is a lot higher than the 10% baseline.

And then we have it on the other end, kind of the outlook with monetary policy and yields. You had yields rise today despite a very weak jobs report, which is somewhat non-tutorial, but I think investors will be watching the details tomorrow very closely ahead of the July meeting that in several weeks. So we are in the second half of the year, Scott.

I'm looking at your notes here. Top five portfolio ideas for the balance of 2025. What are they? Well, Morgan, what we're trying to do is for for one thing we're trying to stick with some quality here And we think the markets come You know it's come a long way Stocks are rich right now. We're trying to trim back. You know if you look at consumer discretionary sector industrial sectors Those have done pretty well lately. we're taking money out of there,

and to be honest with you, clients are either holding some cash, because we think there's going to be a pullback here, or maybe they're circulating it into some other sectors that we do like, like technology. And you talked about the momentum trade, and I think what we're trying to do is, the momentum trades carry the market. The breath here the last few months hasn't been very good.

That usually means that we're gonna have a pullback relatively soon. So we're not jumping in here, we're trying to be patient. But right now, one of our main portfolio goals is that we're gonna see some down to side volatility. We wanna stick with quality bonds, three to seven year intermediate part of the curve. We wanna stick with large cap US stocks S&P 500.

We also like US mid caps. We don't wanna be overexposed to the emerging markets or really developed internationally either. So quality, if you wanna sum up what we're trying to do right now portfolio wise, it's quality, you wanna be patient, we think there's gonna be a pullback and you need to be ready to step in if a pullback should occur.

Okay, Adam, we've gotten S&P 500 at all time highs, tariff deals that simply aren't happening largely within this 90-day negotiation window. So should investors be excited that the huge kind of market tanking tariffs don't seem to be happening despite what the Trump administration had threatened back in early April or worried that the deals aren't happening? Well, I think absolutely the consensus is very much the latter.

There's a lot of optimism that either the July 8th deadline is going to get pushed down for several more months and or that you're going to see a series of kind of benign deals. So like the UK framework had been the template that a lot of people were hoping would show up in a lot of the other major trading partners, which is why Vietnam today is somewhat concerning given that you have a 20% tariff. That's obviously double the 10% baseline. This is much better than that April 2nd chart in the Rose Garden, but still there is a lot

to come on the tariff front, and the next few days and next week, it is gonna be filled with a lot of news. So I think if the other deals are more in line with Vietnam instead of the UK, I think that's definitely gonna be a little underwhelming to the market. Okay, similarly, Scott, this is an odd week with a shortened trading day tomorrow combined with that labor data and then the long weekend.

So how should investors be prepared for the market to respond given where we are at these all-time highs on the S&P 500 and the questions that remain in the back half of the year? given where we are at these all-time highs on the S&P 500 and the questions that remain in the back half of the year. I mean, John, I think on long weekends right now, you know, we'll see what happens in the House overnight here, but let's say nothing happens.

I think people are gonna be very hesitant to go home with large long positions, so it wouldn't surprise me at all if we saw a little bit of liquidation going into the weekend. But you know, I mean this tariff story July the 9th, I mean there's going to be tariffs. I mean look at what happened or what's proposed or anyway with Vietnam. I mean we have almost a permanent level of tariffs. We'll probably see more of these framework agreements. July the 9th, the president says he's not going to extend that.

I mean, there's some July fireworks for you right there. And then of course on August the 12th with China. So I think there's several trigger issues out there, whether it's, you know, is the big beautiful bill going to get passed, which it probably will. But these tariff things, they're in no way, shape, or form over and we can easily see tensions go up there. And speaking of tensions, I mean, the ceasefires held between Israel and Iran, oil prices are pretty tame,

but is that gonna last or not? Because certainly oil prices, if they shoot up, that's gonna be bad for the market All right. We'll watch our step scott adam. Thank you Well, let's turn now to washington as the house takes up the senate budget bill and there's still a lot of hurdles ahead Our emily wilkins joins us now from capitol hill emily Hey john, well, yeah, there's been a lot of drama in the house today Hey, John. Well, yeah, there's been a lot of drama in the House today as Republicans have basically tried to get to. Yes. And now we are really seeing the White House come

in and try to ramp up pressure on some of the holdouts who continue to have concerns about the bill. Now you saw a number of members go to the White House this morning. Fiscal hawks who had some concerns, some of your centrist members who were worried about cuts to Medicaid and to snap programs. But right now we just saw OMB Director Russ Voigt come into the Capitol. We know he's meeting with a group of folks who are really concerned about how much this bill is going to add to the debt, $3.4 trillion over 10 years, according to current scoring.

And I was speaking with Congressman Ralph Norman. He's one of the members who has concerns. He says about 25 other members are trying to get some questions answered from the White House right now so they can move forward on this bill. He said that changes might be needed, but again, he really focused in on the debt and the deficit. Listen to what he had to say. The debt suspending is another thing that we really got into detail on. How we're going to handle the debt suspending. That's the type of thing that we're gonna get answered. The House is actually suspended right now mid-vote.

Leadership told members to go back to their offices, but get ready to potentially begin voting again. Could be within the next hour, could be a couple more hours. It just remains unclear at this point whether this can potentially pass today, tomorrow, before July 4th, or if the House is going to have to make some changes to this bill and send it back to the

Senate. If so, that could begin a ping pong that could go potentially throughout the month of July. So a lot of questions remaining here on what the final product of the Trump mega bill is going to look like. And guys will of course be following developments very closely. All right. And bringing them all to us as they come. I'd also just point our viewers back to our interview with OMB director Russ Vogt yesterday where he laid out the White House case for cuts versus spending and what it means for debt and deficits as well. Well

we have a news alert on Lucid. Phil LaBeau has those details. Phil. Morgan, we've got Q2 deliveries from Lucid, the company delivering 3,309 vehicles last quarter. The production coming in at 3,863 vehicles. Remember, they've already said that they plan to produce 20,000 vehicles this year in the first half. I haven't done the complete math, but I think it's going to be close to 8 or 9,000. So they're going to have to increase production in the second half of the year to hit that mark. By the way, they report their Q2 results on August 5th.

Guys, we'll send it back to you. All right. Phil LeBeau, thank you. Well, coming up, the CEO of Affirm, the stock closing out the second quarter with gains of more than 40%. We're going to get his take on the state of consumer spending, lending, and if he sees any trouble spots ahead. And Microsoft cutting 9,000 jobs. What this big move tells us about the company's priorities going forward.

We have a big show straight ahead. Overtime is back in two. Welcome back to Overtime. Shares of Adobe falling today. Redburn Atlantic cutting the stock to sell from neutrals and slashing the price target by a third to 280 bucks a share. That's roughly $100 below where it's trading right now. The analysts saying AI tools are a threat to its business, particularly in image generation.

Another stock closing in the red is Microsoft after announcing or word of its plans to lay off more than 9,000 employees came today. This comes after 6,000 people were let go back in May. Largest number of layoffs in technology so far this year and joining us now to discuss is Alex Kantrowitz, big technology founder and a CNBC contributor. Alex, welcome. It's tempting to say this is about AI taking jobs. But for Microsoft, I'm not sure that's the case.

I do see a movement across tech. We've talked about it here on Overtime with Intuit in PR and marketing jobs to replace some of those with AI. But when it comes to coding, there's still demand at the high end for the coders who can use and create AI capability, no? That's absolutely right. These layoffs had nothing to do with AI replacing jobs.

For almost the entire economy, AI is just not good enough to be able to take over jobs. We had Anthropic try this experiment where they had AI run a vending machine and it couldn't get it right, it was bargained down. It just showed that their most cutting edge technology was not even able to stock the company fridge. So I think these layoffs from Microsoft are retooling,

cutting in areas that it felt needed to be trimmed down a little bit, maybe saving some money because it is gonna be spending $80 billion on CapEx this year. But this idea that Microsoft is replacing employees with AI is just, it's not true, it's not feasible, and certainly not the case today. But I do think, Alex, that some of these companies are replacing certain work with AI.

It's causing them not to need to hire entry-level employees to do grunt work, and it's causing expectations of existing employees to shift. Sridhar Ramaswamy over at Snowflake has told me, and I think he said on the call, that he's really pushed his coders to use AI more to increase their productivity, maybe not replacing jobs so much as keeping them

from needing to hire as many more people, right? Yeah, that very well could be the case. I was speaking with the head of revenue at one of these big labs just a few hours ago and asked how many companies are coming in asking to reduce full-time employee numbers with this technology. Basically never happens is what this person said. Now, are some companies trying to become more efficient and doing more with the people they have? That's possible, but I would note that for as many people

that try to do that, there is probably equal or larger number of people who say, look, we have so many things on the roadmap that we haven't gotten to yet. We're gonna take that increased productivity or increased efficiency and actually get to the things that we wanna do. Okay. We are seeing so much money from the big tech companies,

Microsoft, I mean obviously Meta with the whole talent war situation heating up and how much, they're paying some of these folks that they're bringing in from OpenAI and other places. We are seeing more and more money go towards developing these AI capabilities much more aggressively. So whether it is the layoffs at Microsoft or whether it is some of the retooling we perhaps may be starting to see publicly or not so publicly at the other companies though,

does it represent a diversion of cash away from more traditional tech businesses to AI? I think there definitely can be a shift. I mean, the money is going to have to come from somewhere, especially if you're doing out contracts like Meta is. I mean, I don't think any company outside of Meta is giving these multimillion dollars, some might say up to a $100 million up into, according to some reports, contracts for AI researchers to come over. But AI talent costs a lot of money.

And so if you do want to play there, you might have to divert from other divisions to your AI research divisions. You're surely not going to be cutting investment there. But I should also note that Microsoft, in particular as a company, that beat consensus estimates on profitability in the most recent quarter. It's doing great.

So, and the market rewards companies for investing in AI. So I don't think it's going gonna be as much of a poll, like what do we cut to invest? Maybe some of that, I think largely, what we're seeing with Microsoft is just them trying to figure out where their company works best. And I really don't see a read through to the rest of Big Tech.

At least not with this magnitude. Sounds good. Alex Kantrowitz, thank you for joining us. Thank you. Coming up, we're gonna dig into the 940 page budget bill. We're going to find the things that matter the most to investors. There's a lot. And Robinhood has been one of the hottest stocks in the market, up 130 percent just the past three months.

What does that tell us about the retail trader? We'll be right back. Welcome back. President Trump announcing a trade framework with Vietnam which includes a 20% tariff on Vietnamese exports into the U.S. The administration had imposed a 46% duty on Vietnam back in April. Several companies with manufacturing there getting a boost, in particular the furniture makers. Check this out. Wayfair R.H.

Williams and Sonoma. These were your winners today. All right. And now let's turn to Robin Hood hidden all time high today on pace for its best week and a little more than a couple months.

Senior Markets commentator Mike Santoli joins us now for a look at its push higher thanks to retail traders Mike. Yeah John on multiple levels right. So Robin Hood is both the instrument by to retail traders, Mike. Yeah, John, on multiple levels, right? So Robinhood is both the instrument by which retail traders increasingly express their enthusiasm for the market,

and then also Robinhood's the beneficiary of that, obviously getting their business. It has tracked, as I pointed out before, in a general way, at least, Palantir, which was another one of these leading edge kind of retail-held, speculative, kind of retail held speculative kind of high growth high enthusiasm names What's interesting is some of those like Palantir have backed off a little bit in the last little while This is true for core weave and circle this momentum

Pullback that we've seen this week has hit those although not yet Robinhood as you see here kind of rising to almost exactly meet Palantir on an 18-month basis. Now, different timeframes show different relative gains, but it can't be a pure accident that over a year and a half, they're basically the same stock. Now, how big is Robinhood relative to some other financial services peers? Pretty eye-catching. Above $80 billion market cap right now, Robinhood here in the blue line.

That's now just barely eclipsed Apollo global Robinhood's got about $250 billion in customer assets that's just customer assets they don't really manage them. Apollo's got almost $800 billion of assets under management that you draw a fee off of obviously these are very different businesses Apollo an alternative manager not growing as fast but definitely an interesting relative check John on exactly what's going on here in this mark interesting comparison to Palantir how much of their Their tandem movement Can you attribute you think to the head fake that the market gave us over the past three months?

That second quarter was a bit of a doozy, both on the market impact of what the tariffs turned out not to be, and then the outlook for some of the hotter stocks, which Palantir certainly has been. You know, I think it's obviously they've moved in sync because similar groups of people own both and tend to behave similarly, so therefore the rhythms are similar.

I don't know if it's much more complicated than that. There's obviously entirely different businesses. It's just more that they fit this profile of these stocks represent a version of the future we think is coming fast. And also the actual velocity of the stocks themselves have engendered more activity. Now the pullback we got, that was definitely a nasty gut check in March into April. It sort of reloaded that enthusiasm.

It was almost like, you know, once that did not prove to be any kind of a fatal blow for the bull market, it was kind of reloading for further upsets. So we'll see if it lasts, as I say, some erratic activity on some of those stocks this week. We'll see if that matters. Okay.

Mike Santoli, thank you. And we'll see you later in the show. Well, it's time now for a CBC News Update with Pippa Stevens. Hi, Pippa. Hey, Morgan. A federal judge has blocked President Trump's asylum ban at the U.S.-Mexico border. The judge ruling today that the president exceeded his authority when he issued a January proclamation declaring illegal immigration

as an emergency and attempted to keep all migrants from claiming asylum in the U.S. The White House just now are rejecting the ruling and saying that it will appeal. Iran's nuclear program has been degraded by up to two years following the U.S. strikes on three key Iranian nuclear sites last month. That's according to a Pentagon spokesman who briefed reporters on Wednesday. He also added that the U.S. assessment of the damage to those nuclear sites remained unchanged. And the CDC has accepted recommendations for use of an RSV vaccine that were made by an

advisory panel months before they were abruptly fired by Health Secretary Robert F. Kennedy, Jr. According to the agency's website, it now recommends that adults aged between 50 and 59, who are at risk of severe illness from RSV, receive a single dose of the vaccine. Morgan, back to you. Good for Stevens. Thank you. Well, coming up here on Overtime, Affirm CEO Max Lebchin joins us. We're going to get his take on the fintech space, the consumer, the big move we've seen in the stock over the past three months.

And sticking with the consumer, discretionary is the worst performing SMP sector so far this year. Healthcare, the only other sector in the negative. But are we about to see a reversal? Somebody thinks so. Stay with us. Music Welcome back to Overtime.

Let's get a quick check on the market. As the Nasdaq returns to its winning ways, gaining nearly 1 percent. S&P 500 closing at the highs of the day. A new record. Tesla snapping its six-session losing streak on the back of delivery numbers that met expectations. Also regaining the $1 trillion market cap level. Another good day for chip stocks overall. NVIDIA adding a couple percent, getting close to $4 trillion in market value. And a big day for crypto. Bitcoin within a few thousand bucks of its all time high and Ethereum with an even bigger gain. Well, up next, we're going to break down the tax cut bonanza.

Wealthy Americans are set to receive if the Senate's budget bill becomes law. Plus, bank stocks on pace for a three week winning streak. Coming up, Fast Money's Tim Seymour tells us whether there's still room for those stocks to rally ahead of earnings season. Welcome back to overtime. Today's surprise loss in the ADP private sector report painting a mixed picture of the strength of the economy. Could it signal that we may start to see a slowdown in consumer spending ahead as a result? Well, let's get a snapshot from someone with a front row view of the consumer.

Joining us now, Max Levchin, founder and CEO of Affirm. Max, it's great to have you back on the program. Welcome. Thank you for having me. Let's start right there. What are you seeing in terms of spending behaviors from the consumer? What does it mean for Affirm? You know, I've said it before, I feel like I'm on broken record at this point, but every time I ask this question, I say, the rumors of the demise of the American consumer are greatly exaggerated. We're seeing good demand. We just reported over a month ago now, I guess, our prior quarter and the strength was apparent. The growth was really, really good.

High 30s year over year in spending and all the other metrics even better. So nothing, you know, nothing too dark to report. I think, you know, obviously the macroeconomic news concerns people for all the right reasons. And so the conversations with the man and woman on the street reflect that, but in terms of their shopping patterns,

their borrowing and their ability to pay us back, it's all been very strong. What are your thoughts on this move by FICO to have scores begin reflecting buy now, pay later data? Is that good or is that bad? I think it's very good. I think the TransUnion published a study a little while ago that showed that of the folks that have not tried buy now, pay later services,

a meaningful percentage have not done so because they feel that it doesn't reflect their repayment history and doesn't help them build their credit history, their credit score. We have been reporting majority of our transactions to the credit bureaus since 2017. So nearly a decade of accurately reflecting repayment history of our customers and vast,

vast majority of them are repaying us on time every time. So there's this giant body of data that is out there saying, hey, these folks are not overextending, they're not overspending, they're not foolishly applying for these loans, they're really being responsible adults. The fact that it's going to start being reflected in their credit score and FICO is the preeminence or lingua franca of scores out there is really important. I love when people choose a firm instead of credit cards, but their FICO score is important when they borrow for a car or apply for a rental apartment.

And so the fact that the score is going to reflect their usage of a firm and being responsible and their payment back, it's just all kinds of good news for them. If I'm allowed, I'll call on the rest of the industry to participate in this because I think it's not just a firm out there that's providing the services. We want everyone to start recording.

Max, we can often forget about the checkout aspect of a firm's business, which I imagine gives you a very interesting, granular look into consumer behavior. So what are you seeing there in the mix of services versus goods and how consumers are treating particularly big ticket items right now in this economy? Again, just from my perch, and some of the headlines out there

will make you think twice about that, but we are seeing a real shift from revolving credit into pay-over-time responsible payment. Big-ticket items, obviously, if you have a sense of macroeconomic uncertainty, you think twice before you pull the trigger on an expensive bicycle or a couch or a service. And all of those things are fantastic use cases

for what we offer. We're seeing great demand in sort of, you know, things that I've never talked about on air for sure. Things like elective medical services are now a real component of our volume, which is not something we saw maybe even anticipated a few years ago, but now, I happened to be in a dermatologist's office the other day

in all places in Hawaii and saw my own logo prominently displayed and got a great conversation with a couple of receptionists who told me how much they love the service and how helpful it is to folks that come in and have to pay for these relatively expensive procedures. And so we're seeing services become a component of buy now, pay later industry,

but overall the demand, the shift from revolving credit to a firm is really strong. I imagine seeing that brightened up your complexion immediately. What should we expect to see happen with near prime as we get into the back half of the year with consumers generally stretched with their credit, but with you having this model where I think you expect

to take some business and attention away from traditional credit cards. That's exactly right. So we expect to continue, continued strength. We're very optimistic about entering the second half of the year, beginning of our fiscal year, so happens. And it's entirely because the message of being responsible in your borrowing, deciding that there is a fixed time

window, start now, paid off by January 1, or whatever the right timeline for you, has given people the confidence and a sense of control that they crave. So as they go into back toto-school sales and Christmas shopping, if I'm allowed to mention this, it's so far away, they are starting to apportion their money because they're not entirely certain how the year is going to play out for them.

Knowing when they're out of debt is a great way to sleep better at night. And so we see that every year and I don't think there's going to be any different. Finally, Max, I realize you had a foray into crypto in the past, but we're hearing about the stablecoin summer. Visa and MasterCard have come on CNBC to talk about how they've been building and investing into the infrastructure and partnerships. Brian Armstrong comes on the show from Coinbase and says we're entering this era of utilitarian and payments focused, consumer focused crypto dynamics.

Are you reconsidering crypto in any way? How do you think about it? You know, I've learned over the years that it's important to be open minded in payments. Something that didn't work over and over does not mean that it will not work. I'm generally speaking, you know, on the record as a crypto skeptic I've always found Bitcoin and its overall Sort of ilk to be more of a store value perhaps a speculative investment I haven't seen a profound use case for consumers spending their crypto assets I think they just enjoy the appreciation if they have those that said I think stable coin as a settlement mechanism

Especially for those willing to keep a balance of stable coins, especially cross border, that's a great use case and there's absolutely nothing I can, you know, no holes to poke there. That makes a lot of sense. And people are deploying that quite rapidly. And we're certainly eyeing it even as we consider our expansion internationally, on the record about our UK launch and European plans. So I think all of that makes a lot of sense. I would love to live in the world where you are freely spending your stable coins at US and worldwide retail.

I think that's maybe the future state, not today's state, but if it does become a thing, we'll be there. Max Lefchen, great to have you on, thank you. Thank you. The version of President Trump's tax and budget bill, which passed the Senate yesterday, provides a windfall in tax changes for wealthy Americans. Robert Frank is here on set.

Welcome, you break it down for us. Good to see you, Morgan. Good to see you, John. Well, the top 20% of Americans are those making more than $220,000 a year. They will get an average tax cut of about $12,000 or 3.4%. Now, millionaire earners, they get an average cut of about $75,000 or 3.4%. Now millionaire earners, they get an average cut of about

$75,000 or 4.5%. So the higher you go, the better the cut. Now the salt cap would raise from 10,000 to 40,000, those for making more than $500,000 a year. The 20% deduction for pass-through income, that's very important for these folks. That will be extended. And the estate tax becomes permanent and more generous with that exemption going to 30 million dollars for married filers that means that very few people are actually going to owe or pay the estate tax now but there is a big new benefit for wealthy investors that was not in the House bill and that is known as the qualified small business stock provision it was started by the Clinton

administration but the Senate is now going to expand it. So effectively the change allows more companies to qualify and increases the capital gains tax breaks that would encourage small business investment. So that's a new thing that's in this Senate bill that was not on the House. Now, one negative for high earners also hasn't gotten much attention

is a limit on certain deductions that will make charitable giving a little less attractive. Now, some estimate those changes could reduce giving by the wealthy by over $8 billion a year. Now, if you want the full breakdown of all the tax changes that matter most to high earners, you can check out the Inside Wealth newsletter at cbc.com slash inside wealth cbc.com slash inside wealth out tomorrow morning with.com slash inside wealth, out tomorrow morning with a full breakdown of all the big changes for high earners. Fantastic newsletter, of course. Now, back to that philanthropic thing. There's also another interesting provision that encourages the wealthy and businesses to give towards scholarships supporting vouchers.

And it's a tax credit, not even a deduction, which seemed to me to be kind of unheard of within the tax structure. So in a way, is this shifting the incentive for traditional philanthropies to have private schools? Well, it is certainly a boon to private schools and many people characterize that as, oh, this is a gift to the wealthy for private

schools to be cheaper. I look at it as you know making private schools more available to other people in the system. There's also when you speak about charity there's a provision that when they made the charity with a standard deduction in the 2017 taxes when they doubled that it basically reduced the incentives for Americans to itemize. So what happened, the unintended consequences, less average Americans gave to charity after 2017. To fix that this time around, they're putting in a $1,000 or $2,000 basically itemization allowance so that more everyday Americans can give to charity again, even though we might see this

reduction at the top. So in the end, we might see this reduction at the top. So in the end we might see less giving at the top but with this allowance in the rest of the population overall giving might stay the same and I think it's better if more everyday Americans gave to charity again. So there's so much complication, there's so much moving around it's hard to say everyone's getting a tax cut or the wealthy are getting a tax cut. Nobody else is getting a tax cut. It depends on how you make your money, how you itemize and you know where you are in the income ladder. Robert Frank, great reporting as always. Thank you. Well, health care is second worst performing sector in 2025. Up next, Fast Money's Tim Seymour tells

us why he sees the opportunity for some healthy returns during the second half of the year. And later we'll get you set up for tomorrow's crucial June jobs report and the potential market move, although short, that it could bring. We'll be right back. Welcome back to Overtime Healthcare. It's the second worst performing sector in the S&P 500 so far this year. It is down 6% in the last quarter.

Our next guest sees the sector as a bright spot for the second half. Let's bring in Seymour Asset Management Chief Investment Officer and CNBC contributor Tim Seymour. Tim, tell me about this, especially since there's some big changes coming to Medicaid through this bill that's trying to make its way through Congress. CNBC contributor, Tim Seymour. Tim, tell me about this, especially since there's some big changes coming to Medicaid through this bill that's trying to make its way through Congress, one I imagine has to

put their money on the idea that it will. Is that disruption an opportunity or a danger for these stocks? Well, hey, John, great to be here. I think it's a combination of we've priced in a lot of the negative around here, whether it's been health and human services changes, whether it's been Medicare, whether it's been the negotiations for some of the big drug companies, whether it's been loss of exclusivity, cliffs.

I look at healthcare as what was always defensive, especially at a time when people have thought about markets that might be a little frothy and some of the volatility that could be ahead. I think healthcare, I think the recent rotation we've had even in the last couple of days, maybe this is the rotation that refreshes, but I think healthcare is well positioned

to actually outperform at this point. So healthcare overall, do you do sort of a more broad-based investment, or is it a specific subsector that you'd be focused on here? Good question, Morgan. I think it's a bit of a barbell. I think you're reaching into biotech. I think we've started to see deal flow.

I think we've seen some of the companies that are exposed in some of the sexier parts of oncology and GLP are starting to move. I mean, look at the moves in Gilead, look at Amgen. But I also think some of the traditional big pharma, whether it's Pfizer, which has eight oncology announcements that they are at least drugs they expect to have significant impact by 2030. I think J&J on medtech is defensive but also there's some upside maybe with the

talc litigation announcement. I think there are drivers for a handful of these names and I think between both handsome dividends and where valuations are finally attractive that's part of the story. And I guess the Medicaid reliant are in the middle of that barbell? Yeah, I think they have to be. And I think there's certainly a lot more concern and an inability to really predict that outcome. But I do think a lot of the players

that might be most affected, we've started to evaluate what some of that negotiation will mean for their share prices. There's a little music happening behind you. It's mood music. It's like a sneak peek into the preparation process for fast money. We're always rocking here, Morgan. Yeah.

And so I don't know what's going on around here, but we sing along. Well, Tim Seymour, it's great to have you on. Thank you. It's great to be here. Thank you. You can catch much more from Tim and the other fast money traders who are listening to that music coming up at 5 p.m. Eastern. Stay tuned. And tonight they'll be speaking with CHiPs analyst Stacey Raskin about the recent rally in the

space. And up next here Mike Santoli is going to look at what the unexpectedly weak ADP employment report could mean for tomorrow's June jobs numbers and the overall economy. Be right back. Welcome back to Overtime. Let's get you set up with tomorrow's trade today on a huge slate of economic data. The June jobs report is the big one that investors are going to be closely watching, expecting non-farm payrolls to come in around 117,000. We'll also get weekly jobless claims, ISM services, and factory orders,

and something else to look forward to, an early special edition of Closing Bell Overtime, which starts at 1 p.m. Eastern, because the bell is at one in a shortened trading day. And speaking of the jobs report, let's get back to Mike Santoli for a set up into that key report. Mike.

Yes Morgan, one of the big questions is whether today's ADP private sector payroll report, which showed a decline in overall jobs last month will be predictive of the official non-farm payrolls. Now in the past, they have not always matched up particularly well on a monthly basis, but here's one sub-component, health and education jobs. You see the downtrend, this is a three month average, in the ADP numbers, private sector.

It's not really been matched so far by the official numbers. Of course, that's a big source of net job growth in general over time. And so we'll see if there's any connection here. You know, obviously it's a different sample. The overall jobs picture includes public sector. But this is one area where you might want to look for some variation or confirmation there. Now, what does it take to make an acceptable monthly jobs report?

Take a look here at what's known as the breakeven level of monthly job gains that is necessary in order to keep the unemployment rate steady. It has been coming down. Why? Because population has not been growing. We have a crackdown on immigration. You have labor force. It's not growing nearly as fast as it was. So you only need at this point it's about 87,000. This is one estimate. Jed Kalko, former Census Department economist, economist at Indeed has estimated this. Some estimates are much lower

than this. Wall Street Journal is saying as low as 40,000. So you have this kind of low turnover, low metabolism job market. Maybe it's okay to keep the unemployment rate age adjusted in check guys. Yeah, the whisper number it looks like is 100K tomorrow. And just to sort of add onto what you said, the number of new jobs created has averaged 135,000 a month.

That sounds from 186,000 a month under President Biden. So I would imagine going under the hood here to some of those key metrics, including wage growth, for example, it's gonna matter maybe more than ever. Yeah, all of it is gonna matter. And what the other interesting element of it, Morgan, is that what's the market rooting for here?

I think in general, what the market might be rooting for is a soft enough jobs report that doesn't really tell you the economy is in a downturn, but maybe it moves the Fed equation enough to get a rate cut and then it's sort of a head fake in the data. Maybe it kind of bounces back from there. In general, I think the whole package of macro numbers we're going to get tomorrow, I think investors should probably want pretty much confirmation that the economy continues to grow. You usually want

good news to prevent bad things in markets. Okay, Mike Santoli, thank you. I want to go back, it was Mick's day today, the Dow finishing it in fractionally lower, but the S&P and Nasdaq both at record highs, finishing the day higher. I want to go back to something Scott Wren discussed with us at the beginning of the hour, and that was how narrow breadth has been, and how that is dictating his investment playbook for the second half of the year. B of A noting that this is the narrowest breadth ever for an all-time high. We talk about those mega-cap tech names,

and some of the momentum names, where that trade has been winding the last couple of days, but the other sectors, perhaps, in more focus now than ever. Yeah, and at the same time, it was a big day for the chips overall. Interesting, the AI infrastructure market has been rebounding in a way. Remember all that trouble Supermicro was having, CoreWeave having a great IPO.

Supermicro knocking on the door of 50 bucks a share again, it's up close to 49 after being way down with those accounting issues. how that's moving along with everything else. Yeah and we'll just say it one more time 1 p.m. equity closed 2 p.m. early credit closed you could see us here tomorrow at 1 p.m. that does it for us at overtime.