Closing Bell - Closing Bell Overtime: Dollar’s Big Drop; Nike Earnings & A New NYC Wind Farm Project 6/26/25

Episode Date: June 26, 2025

Our Rick Santelli breaks down the latest on the Fed speculation and its impact. Stephanie Link of Hightower and Keith Lerner of Truist weigh in on the market outlook. Nike earnings hit after the bell, and Oppenheimer’s Brian Nagel offers instant analysis on the Dow component. Our Diana Olick breaks down the state of the U.S. housing market, while our Pippa Stevens reports from Brooklyn on a new NYC wind farm project. Defense stocks also in focus, with top picks from Stifel's Jonathan Siegmann. 

We are now in the closing bell market zone. Taneya McHale is looking at Circle as those shares resume its post IPO rally. Gabrielle Fonrouge standing by with what to watch from Nike when it reports in OT. Plus HSBC's Max Kettner is counting us down into the market close. Taneya, I guess a one day or two day break with Circle, but it's back to the upside. Yeah, Mike, off its highs of the day, but it is climbing again after its full first pullback earlier this week, which looks like natural profit taking amid perhaps overbought conditions. It's still hot off its monster IPO from the beginning of this month, up about 600% since

then. So I'd expect continued volatility, especially as investors look for other ways to make money in crypto now That's more exciting than Bitcoin perhaps but less risky maybe than other cryptocurrencies What's interesting Mike is the rotation that we saw out of circle and into Coinbase during that pullback Coinbase jumped over the same three days that circle fell and are still climbing today The two companies of course very close have a significant revenue sharing agreement So investors starting to see how Coinbase could benefit from stablecoin opportunities.

Coinbase are, as of now, best performing stock in the S&P 500 for both the month and the week. Mike? Yeah, and on absolutely massive volume. There are some days where half of its float has traded just in a single day. So obviously a lot of excitement there. Thank you very much, Taneya. Gabrielle, tough year for Nike,

but the stock's been bouncing this week. Yeah, it's definitely been a tough year and there might be more pain to come. Nike is expected to report earnings per share of 13 cents on revenue of 10.72 billion. Now this is expected to be a double digit drop from the year ago period as Nike continues to work through its turnaround.

But a key question from investors tonight will be, is this the low point of its turnaround or is the worst still to come? In March, Nike said its fiscal first quarter is expected to be the low point, but conditions have worsened since then. It's now facing a 30% tariff on goods imported from China up from 20%, and the consumer environment remains rocky. Investors will want to hear more about Nike's timeline to recovery, how its China business is doing,

and color on how product launches are performing. Mike? All right, we will be tuned into all that. Gabrielle, thank you very much. Let's bring in Max Kettner, HSBC's chief multi-asset strategist to talk about this close match. You know, I sit here, the S&P 500 at 6142.

It's a couple of points from the closing high from February 19th. Does it make sense that we're back here? Yeah, I think it does. It absolutely does. Because when we look at the earnings picture, that actually does really still look resoundingly good. And when we look particularly at forward earnings,

when we look at q2 earnings expectation It is actually bizarre to me that consensus is looking for a quarter and quarter drop now in the q2 reporting season Redditive to q1 so when we look at that, you know consensus saying we're going to drop from around $63.50 down to $62.50 down in q2 that creates a massively low bar to beat. And even in tech, earnings are expected to just remain flat quarter and quarter. Let's remember that, particularly with the weaker dollar, you know, the magnificent seven to seven mega caps make around 60% of their revenues outside of the U.S. So that really, really should support particularly the tech earnings, particularly the mega cap earnings going into July and August.

And that actually could lead us to even more all time highs, I think, going forward. So then if investors have the luxury of being mostly able to focus on the corporate fundamentals, you talked about the earnings growth, obviously corporate credit conditions are quite strong at this point. That would be great, I suppose,

but I guess to what degree are you confident that we've been able to set aside things like the tariff threat, which remains open-ended to some degree, and then of course all of the other sort of policy flux out there. Yeah, look, I think we can take that from both the bearish and the bullish side.

Unsurprisingly, I'll take that probably more from the bullish side. You know, one of the bullish things around this is what we face right now is this classic textbook-like wall of worry. You just mentioned tariffs, right? We've got the 9th of July deadline. We obviously also have the 12th of August, the US-China deadline.

Perhaps in August and September, what could keep investors quite cautious as well is any sort of possibility of a failed bond auction and treasuries. Then, of course, in the second half, the narrative goes that, in fact, maybe we'll see some reversal of front loading of activity, which keeps activity quite strong in Q2. So I would argue what we're seeing right now is very subdued positioning, very subdued sentiment, precisely because of all these elements in the wall of Fory that we need to climb. What I haven't seen personally yet is that

we're climbing by almost 25% from the lows, we're almost back to an all time high in equities, and our positioning framework is still nowhere near sending a biosignal, and in fact nowhere near signaling neutral, it is still sending a buy signal. And that really is positive. Yeah, and there's no doubt that many professionals

feel as if they need to chase this thing to get their exposures back up. How does the Fed fit into this framework? I mean, if you say things are great and markets are at a high, there's still a drum beat for saying that the Fed is too late. How does that fit in? Look, I think, you know, I would be worried about higher yields. There is a narrative, of for saying that the Fed is too late. How does that fit in?

Look, I think, you know, I would be worried about higher yields. There is a narrative, of course, that, you know, if growth is too strong, doesn't that hurt equities and credit spreads and valuations across the board? Because obviously it might keep the Fed a bit mahogany. But let's remember, the outlook for the Fed,

for risk assets, is pretty much binary. As long as they tell us, look, in the next six to 12 months, the next move is going to be a rate cut. That's totally fine for risk assets. And that's very, very likely going to continue. They're not going to tell us that they're going to stop now because, of course, inflation is on this generally pretty, pretty supportive path downwards. And on the other side, when we look at yields, you know, I would be more concerned if the 10 year was, you know, well north of four and a half percent, the level that we've identified where it really starts hurting risk assets is still around 470, 475. So you could argue we're a good 40, 50 basis points away from that. So even if we were to get

an upside surprise on tariffs, on inflation, maybe even on activity in the next couple of months, it will take an awful lot of upside in yield until it really starts hurting risk assets. Until then, it's really game on for risk assets, for equities, for credit, for pretty much the whole risk assets victory. Yeah, I mean, treasury yields down, oil down, dollar down, financial conditions looser, pretty tough to pick apart the bullcase in that environment.

Max, it's great to have you weigh in. I appreciate the time today. We are about 30 seconds from the close, and as of now, we are tracking for a new closing high on the S&P 500. It's very close. You see it there, 6144.19 or 15 is the old one. So it's going to approximate the old closing high, the intraday high was $6147.

It is a broad rally as well. Some three quarters of all volume is in advancing stocks. You have things like banks fully participating up 1.7%. That shows of a closing bell. Send it in to overtime with Morgan Brent. Well, that's the end of regulation. Forge Global ringing the closing bell students overtime with Morgan Brennan. Well, that's the end of regulation. Forge Global ringing the closing bell at the New York Stock Exchange, Dune Acquisition Corporation doing the honors at the Nasdaq.

Wow, what a close we have here. Stocks moving higher today with the Nasdaq hitting its highest level since December of 2024. The S&P, its highest level since February. I mean, we're still settling out here for the S&P. It looks like we're closing just below a new all-time record. S&P and Nasdaq, as I mentioned, both closing a few points below their all-time closing highs.

The Nasdaq 100, though, that did hit a fresh all-time intraday high, third day in a row there. Energy and materials were your leaders today, while real estate lagged. It was a good day for copper as the dollar weakens. The medal near a three month high, lifting shares of Freeport, MacMoran, and Southern Copper. McCormick rallying today on an earnings beat

with full your guidance reaffirmed despite potential tariff impacts, some spiciness there. And a bullish day for the financials with Goldman Sachs and JP Morgan among the top Dow performers. Banks are on pace for their best week since mid-may well that's the scorecard on Wall Street welcome to closing bell over time I'm Morgan Brennan John Ford is off today well coming up we will get results from Nike

we're gonna get instant reaction to those numbers as well plus we will talk to an analyst who is initiating coverage on the defense sector aerospace and defense and that comes as the ITA ETF is tracking, that tracks that group, hit a new all-time high in today's session as well. Plus, we are looking at all the housing data we've seen recently and the picture it paints about the state of housing in America.

The NASDAQ 100, as I mentioned, hitting a record in today's session. Let's bring in Christina Parts-Nevelish. She's got a look at a few of the day's big tech movers and tech Christina has really been in the driver's seat here. Yeah, you take your pick of reasons, Middle East easing tensions, White House saying earlier today

that the July 9th trade deadline may not be as important and then you also have the return of the AI trade which is really driving a lot of these tech names higher. Let's start with the biggest movers of the day, I should say, of the day. We're at the end of the AI trade which is really driving a lot of these tech names higher. Let's start with the biggest movers of the day, I should say, of the day. We're at the end of the day right now. Marvell, Marvell climbing over 5 percent higher.

This is a custom chip maker, Airbnb, DoorDash in the mix. I want to focus on Marvell because it is the biggest winner among the chip names as a whole. Broadcom today was just shy of its 52-week high. NVIDIA, you talked about the NASDAQ 100 hitting an all-time high. NVIDIA also today, intraday all-time high around 156. We can see it close at about 155 right now.

There really is only about two to three chip names that were lower today, and two of them were among the worst of the NASDAQ. That would be ASML on a downgrade and Micron after earnings. Micron's earnings beat and the guide was strong, but expectations were really high into yesterday's close. The stock was up 51% year to date. So it was just a crowd of trade, but I wanna end on Coinbase

because Coinbase had its first record close in more than three years. And you could see it's trading at $375. It closed at that, much higher than that November 21, 2021 close. The new legislation in Washington adding legitimacy and acceptance to the sector, as well as, you know, of course, Bitcoin too, driving this name a lot higher

today, over 5%, Morgan. Yeah, flurry of partnerships and consumer reaching initiatives from Coinbase as well. Yeah. Stable coins from Walmart, Visa, you name it. All right, Christina Parts-Nevelis, thank you for breaking that down for us. Well, Treasury yields falling today, so is the dollar hitting a three-year low.

Rick Santelli joins us now for more on all of that and the latest on the President versus Fed Chair Powell drama, if you want to call it that. Certainly everybody's talking about the possibility of a shadow Fed, Rick. Yeah, put the drama aside, I look at the market reaction and the market doesn't care that the possible changes 10 months away, the market's moving on the notion

that the next Fed chair is most likely gonna have the same line of thinking on interest rates as the current president. Now, if you look at a two in 10 chart of yields, which by the way are on pace for the fifth lower yield close in a row, they're going to be closing at the lowest yield since the first of May. Let's call that an eight week low yield close. So you can see the effects there.

But why do we think it's because of that dynamic about the president picking a dovish Fed chair? Well look at the 2's 10's spread. Two-year yields are falling much quicker than 10-year yields and that's a good clue. Right now it's the steepest it's been since the 20th of May on a closing basis at 53 basis points. Now if we look at Fed Fund futures this is December 25 and it's a two-week chart. On the left side, if you figured out the amount of quarter-point cuts, it would have been 1.8 on the 16th of June. Two weeks later today, it's pricing in 2.6 quarter-point cuts. When that market rallies, it prices in more easing.

And if we look at what's going on with the dollar index on a two-week chart, it's also on pace for its fifth lower close in a row, and you can see the effects there. It's following interest rates and the notion of a dovish Fed. But there is a bright spot, and the bright spot is multinational corporations are cheering the lower dollar is good, most likely for the S&P 500, much better than for middle-class consumers whose dollar purchases just aren't going to go as far as they once did. Back to you.

Rick Santelli, thank you. Let's turn to the market. The Invesco S&P 500 high beta ETF that tracks highly volatile stocks at a new all-time high this morning. It's pacing for its best quarter since 2020, led by names like Freeport-MacMoran, Albemarle, Arista Network, and more.

So how do you navigate this market? Well, joining us now is Hightower Advisors Chief Investment Strategist and CNBC contributor Stephanie Link and Truist Wealth Co-Chief Investment Officer Keith Lerner. It's great to have you both here on set. Welcome. Stephanie, I'm gonna start with you because Rick was just talking about the weaker dollar

and the fact that that actually provides a tailwind for multinational companies. You were nodding your head. Is that part of the reason we've seen stocks climb this wall of worry and now flirt with new record highs? I think we're chipping away at the wall of worry, right? We have better dealings with tariffs for sure. We're making some progress.

Geopolitics is kind of dying down for now. Inflation's coming down, and the Fed may go in September. And actually, I thought Powell sounded a little bit more dovish than I had expected this week, that they would have been cutting rates if it wasn't for tariffs. So what does that all mean, to get to answer your question? The economy is growing. Atlanta Fed trackers running at about 3.4%

for the second quarter. Average first quarter and second quarter, you're running at about 2% in the economy. That's good. Earnings, I think, are going to beat, not just because of the weak dollar, but because revenues are gonna come in better than expected, because the economy is better than expected.

And you have the tenure at a six week low. That's good for stocks, yields are, lower yields are good, and you have $7 trillion of cash in the sidelines. So you buy. Okay, do you buy? Sounds like a pretty good case that Stephanie just made. I think overall the big picture is one

that the market should continue to move higher. I do think that valuations may constrain on how high we go, but the big picture is, we've been moving sideways for seven months. We've had a lot of activity back and forth, but a couple of things you already mentioned I really wanna highlight. One, the big T is technology, not terrorists, right?

We were so focused on terrorists, but right now we're seeing the dominant theme of this bull market. Every bull market has a dominant theme, and that's AI, that's come back to the forefront. And by the way, even though the market S&P is just coming back towards a new high, the technology sector already is at a new high.

So that's gonna hopefully bring the rest of the market up. And the other thing that's notable is, that earnings season that we had last earnings season was better than expected, but what we're really seeing in the data right now is these growth sectors, tech and communications, continue to move forward. So as Stephanie mentioned, you have some good tailwinds

as far as lower interest rates, inflation, and this kind of tech theme. And technically, technically, if you break out of this range, I think you're gonna cause a bit more of a squeeze. So is that where you would be buying, Keith? The big T, tech, your overweight there? We've been overweight communication services all year long.

A few weeks ago, we went overweight tech. We're overweight growth as well. So we would stick with that. We're also positive on industrials. If you have a little bit of some stability in the economy, but that's also an indirect AI play when you think about the power generation, the cooling side of things as well. So we like growth and we like industrials as well. Stephanie, you and I have had conversations over the years about industrials.

I think a lot of folks would be surprised to hear that industrial sector in the S&P, it's up 10% year to date. It's a top sector so far despite tariffs and trade and macro worries and everything else. It's absolutely amazing but it is AI, it's data centers, it's grid, we haven't upgraded the grid in 50 years, it's power as Keith just mentioned but it's also aviation. Look at Boeing, they're getting their act together, GE getting their act together, turnaround story at 3M and then I could give you just a whole bunch of the AI infrastructure plays to which we've talked about Vertivism is a recent buy for me GE vernova quanta services eaten. So I like that sector

It's had a nice run. I like financials even better now because I think the deregulation story is better now because I think the deregulation story is underestimated. We're going to get SLR changes. The exchanges are talking about reducing costs for IPOs. We went from 8,000 public companies in 1996 to 4,400 currently. That's got to change and I think it's going to change in addition to better M&A, better capital market. So I think the bank earnings are going to be quite good and the stocks are very cheap on a price to book basis, as well as relative to the S&P 500. One thing I'd maybe I'll just add too,

when you look today, the big names, and not a recommendation per se, but you're seeing JP Morgan, Goldman Sachs breakout, that's not the type of thing you see ahead of a big slowdown in the overall economy. So that's a positive. And I also think, we're doing the reverse of what happened in 2017 with the Trump 2.0. We're seeing the terrorists hit first, but now the markets starting to

focus on what they were focusing on late last year, which is the deregulation and the terrorists coming, I'm sorry, the tax bill that will likely get passed relatively soon as well. Alright, lots for the market to focus on. Great to have you both here to kick off the hour. Thanks for having me. Keith Lerner, Stephanie Link, thank you with all the major averages finishing the day higher. The S&P 61.41, just a couple points shy

of a new record closing high, but it did hit a new all-time intraday high. We have a news alert on Starbucks. Kate Rogers has the details. Hi, Kate. Members, to its board of directors this afternoon, first up, Marissa Mayer, CEO, founder of Sunshine AI, a tech startup that uses AI to automate everyday tasks.

Now, prior to that, Mayer was CEO, of course, president and a director on the board of Yahoo Inc. and spent 13 years at Google. And then also, Dr. Dambisa Moyo, co-principal of Versaqa Investments, that's a family office focused on growth investing globally. Starbucks touts Moyo's 30-plus years of experience analyzing macroeconomic and international affairs, calling her, quote, a skilled global economist. Important, no doubt. Both of their roles as the company mounts this

turnaround under CEO Brian Nickelmore. Morgan, back over to you. Okay, Kate Rogers, thank you. We've got breaking news on President Trump's tax bill. We're just talking about that. Emily Wilkins has the details. Emily. Hey Morgan, well one of the more controversial pieces for businesses in Trump's tax bill is now on the verge of potentially being removed after Treasury Secretary Scott Besson tweeted that he had asked the House and Senate to remove the provision. This of course is known as the retaliatory tax. Some people call it the revenge tax, $8.99. Basically it would say that if other countries put what the U.S. sees as an unfair tax on U.S. companies, that the Treasury Department could then put a tax on companies and investors from

that country. So going a little bit back and forth. But Besson has now said that he has struck an agreement with other G7 countries and that as a part of that, this retaliatory measure is no longer needed. However, this measure is supposed to be a pay for to offset some of the costs in the bill. And so I think the question remains, if it is taken out of the bill, what does that mean for the overall amount it will add to the debt? could that create problems for support on the bill guys? Yeah, we've been watching this one closely.

Emily Wilkins. Thank you. Got peace talks, trade talks and now tax talks in the mix. Well, now let's bring in senior markets commentator Mike Santoli. He is taking a look at some of what is helping drive this record rally. Mike. Yeah Morgan I mean justifiably is a lot of focus on

the mag seven the revival of the AI trade it's been a big source of upside energy in this market but everything outside the mag seven has also been back pretty much to its old highs this is an ETF that actually does have the S&P 500 excluding those big

seven stocks. And you see it's traded just above where it did at its record high. This has only been listed since October of last year. And now take a look though at how this ETF or this XMAG 7 version of the S&P 500 holds up to the mega cap growth area of the market. That's MGK, Vanguard mega cap growth relative to XMAG has beaten the XMAG type ETF. So in other words, Mag-7 has done better. It doesn't mean the rest of the market has done poorly.

So here you see it, Vanguard mega cap growth, this is the XMAG and then that's the equal weighted S&P 500. So bigger stocks, higher quality stocks are carrying most of the load, but that doesn't mean that everything outside of the big tech stocks have been weak. Finally, wanna take a look at an ETF called the Social Sentiment ETF.

What used to be called meme stocks, it's called buzz because of the ticker. That's also made a new high. And this goes all the way back to the first half of 2021, which was, of course, as I've talked about constantly, the peak of a sort of mini bubble in speculative stocks. And we are back there again, Morgan. Super interesting.

And of course, to your point, we've seen a lot of SPAC activity percolate and bubble up here too. It's getting there. Yeah. What we haven't seen make a new high is the Russell 2000 small caps. And also we went into the year with a lot of discussion from a lot of strategists about buying into mid caps here.

What are we seeing in those areas? I mean, the Russell 2000 just in a vacuum looks as if it's trying to kind of turn the tide and get back into an uptrend, but it's well, well lagging everything else. I mean, I think it's sort of downstream of a lot of other themes, which is it doesn't really have a lot of AI exposure directly. And if the people prefer, investors prefer quality and reliable earnings growth, it's not quite there. And if there are parts of the economy that are affected by rates being held well above neutral, it's some of those smaller companies. Mid-caps have done better, so there has been a tiering effect in there. So some of that might be paying off in terms of the mid-cap working costs.

Mid-cap index also generally profitable companies, unlike the Russell 2000. All right. Mike Santoli will see a little bit later this hour. Nike earnings just crossing the tape. We're going through those right now. Coming up on the other side of this break, we're going to bring you those results. In terms of Nike, that stock's been struggling,

to say the least. It's lost half its value over the past four years. So we'll, this quarter, turn things around. Stay with us. Welcome back to overtime. Nike earnings are out. Sarah Eisen has the numbers. Hi Sarah. It looks like they reported 14 cents per earnings per share.

That was better than the 13 cents. It was also beat on the top line a little better as well. 11.1 billion. The expectation was 10.7 billion. So some minor beats here. I just want I'm going through some of the regions. North America was better than expected. 4.7 billion. Still a decline of 11% from a year ago. And then China was worse than expected at 1.4 billion versus the 1.5. Look, the story is not these numbers because Nike had warned that fourth quarter would be the low point when it comes to them trying to clear things out to get what they need,

new innovations and new products on the shelves and to get going on CEO Elliot Hill's strategy. He's been in the job for eight months and the real fireworks are gonna come on the conference call when he lays out his strategy and any sort of timeline if he is able to to when we could see an inflection toward growth for this company. As far as what to listen for on the conference call,

look, most of the analysts expect just quarterly guidance. They haven't been doing full year guidance because they are taking it quarter by quarter. But this is the end of the year for Nike, fourth quarter. So it'll be interesting what they say about order books into the holidays and what they're expecting for the next fiscal year. Another thing to watch out for. I'm hearing that Nike is doing a partnership with Amazon, and so that could be an interesting new approach and

new catalyst. Again, they're revisiting how they have been doing business because they have been underperforming. As far as the comment from the press release here, financial results are in line with expectations, though they are not where we want them to be moving forward. We expect our business to improve as a result of the progress we're making through our win now actions.

One of the things they're doing, they're talking about a sport offense, just what I'm hearing that they could talk more about on the call, and that is a little bit of what they call a realignment of the business. So basically Nike's been, it's been organized by gender, men's and women's.

And I'm told that they're going to be focusing more on organizing it by sport. They want to get back to their knitting, the core business, basketball, running, where they've lost share and where they lost some of the enthusiasm. So not organizing by gender, but doing it by sport, which I'm told will not, is not a big sort of reorg that's gonna result in any layoffs or anything like that.

But it is going to be a complete rethink and sort of reorganization of the processes, including things like innovation and marketing as well, where they have fallen behind. Just another way that Elliot Hill is now that he's made some key hires trying to turn things around. So we'll listen to that call. It starts at 5 p.m. But for now, a little bit better on what was expected to be a not great quarter.

Stock has underperformed this year, Morgan. All right, Sarah Eisen, thank you. Shares of Nike bouncing around here in overtime, but right now up fractionally, about half a percent. So to get reaction to these numbers, let's bring in Brian Nagel of Oppenheimer. He has a buy rating and $120 price target on the stock, which I should note would mean Nike doubling to reach. So your reaction to these results that Sarah just laid out for us.

Well, good afternoon. Look, I think Sarah did a nice job of breaking down the numbers. I mean, for me, the real key is I'm looking through this report is this was weak as expected. Okay, Nike very much telegraphed this week quarter. There's a lot of, just like Sarah was saying, there's a lot of internal reposition efforts that are done. But what I think is most, at least it is from the release, what's probably most important is the commentary

in there from management that they're basically saying, look, this is it, this is the bottom, we're getting better from here. Like Sarah was saying, they're gonna have a conference called five. I think they're basically saying, look, this is it. This is the bottom. We're getting better from here. Like Sarah was saying, they're going to have a conference call five. I think they're going to talk a lot about the new product introductions, maybe some early reaction to those new products, how they're reestablishing these relationships with wholesale. Like I keep telling our clients, I put out another report on Nike earlier this week,

I don't expect any type of all clear. There are challenges ahead, internal and external. But I do think this is probably the worst for Nike. And through fiscal 26, which they're now in, I think results get gradually better. That's where I think the stock really works, because right now it's heavily under owned. The sentiment is very negative. I think the stock starts to work on these better results. I mean, North America than expected still represented a double digit percentage revenue decline. China coming in worse than expected. We know there's trade and tariff and supply chain dynamics here. How much does that factor in when you are thinking about that differential between hitting a bottom and then recovering if you're Nike? Yeah look I mean tariffs are a big issue, right?

I mean, across all the names I cover, I cover a number of names with the cross discretionary consumer. I mean, tariffs are a big wild card. What I'd say right now, what I'm hearing from our companies as I'm talking to them daily is that if the tariffs stick with what we're hearing, you know, the now more muted tariffs in China and definitely more muted tariffs elsewhere, it seems like these

numbers are pretty manageable. Okay, the risk is that the trade war escalates here. And we don't really know. I mean, that could happen in any moment. But again, what I'm hearing, I think this is very much applies to Nike is if these tariffs stay where they are, or maybe even get better, that's very manageable. And I think from that, that's, that's sort of say a backdrop that Nike could continue its turnaround. Okay, Brian Nagle of Oppenheimer, thank you for joining me.

Thank you. One of the Nike Bulls on the street. We'll see what we get in the conference call at the top of the next hour. Coming up, it's been a rough year for the home builder stocks as high costs are keeping people out of the market. We're going to take a closer look at the state of housing. And we're also going to talk to an analyst who is initiating coverage on many of the defense stocks, but not the traditional names investors may think of. We're going to break all of that down straight ahead. This morning's pending home sales report showing sales rising unexpectedly in May. This after a slew of far more negative data in the space. Well, let's bring in Diana Olek for a look at the full picture.

Diana, what does all the data put together telling us? A lot, Morgan, a lot. Pending home sales rose very slightly in May but they're still running at an extremely low level. Just for perspective, the pending index is hovering just above the lowest level in 24 years. It's only a tiny bit higher than it was in April 2020, which was that one month plunge during the pandemic shutdown. We've been around this current level though since December. Now that tiny monthly gain in May came despite rising mortgage rates during the month and was likely due to the more than 31%

more homes for sale than there were in May of last year. Now the read on sales of newly built homes which we got yesterday was much worse even though builders also have an historically high supply level of supply and that's because new homes are more expensive than comparable existing ones and the builders just don't build entry level homes anymore. In addition, the cost of homeownership is rising. Nearly a quarter of all homeowners are now considered cost burdened. That is spending more than 30 percent of their income on housing and utilities according to the latest annual report from Harvard's Joint Center for Housing. It cites home prices up 60% since 2019, insurance premiums up 57%, and even more in high-climate risk areas,

and then property taxes up 12%. One final stat for you, the median home price is now five times the national median income. Three times used to be considered affordable. Morgan? You know you just laid it out so well all the hidden costs of homeownerships whether it's the power bill whether it's the insurance premiums that are being paid some of these other metrics as well but there did seem to be one silver lining and what you're reporting and that is the fact that more

inventory and I realize we have a long way to go seems to be coming online so how much now hinges on mortgage rates also coming down? Well you definitely need mortgage rates coming down but I'll put a little cloud on your silver lining and that is that a lot of that rise in inventory is because homes are just sitting on the market not selling and that's causing the inventory to rise. Okay. Sorry. Diana Olek thank you for breaking it all down with all the key insights as usual. Well it's time now for a CNBC News update with Kate Rogers. Kate. Hi Morgan. The Trump administration

plans to send Kilmar Abrego-Garcia to a country that's not his native El Salvador after he's released from jail in Tennessee. He now faces human trafficking charges here in the U.S. In the hearing, federal prosecutors said that they would comply with all court orders and that their deportation plans are not imminent. Bill Moyers has died. The acclaimed journalist started as press secretary under President Lyndon Johnson before becoming an acclaimed television journalist, mostly for PBS, but with time at CBS News as well. His son tells The Washington Post the cause of death was complications from prostate cancer. Bill Moyers was 91 years old. And a fireball appears to have exploded over the southeastern U.S. earlier this afternoon.

Videos shared widely across social media show a streak with a bright flash, which appears to be the meteor exploding. The American Meteor Society received nearly 150 reports of the explosion in the sky and says it's investigating. The FAA said it had no reports of unusual aircraft activity. Back over to you. Oh, I wonder if somebody's going to find it and what it's going to look like. Kate Rogers. Thank you. I also hope nobody was hurt in the process.

Well, coming up, tensions flaring up in the Middle East, putting defense stocks in focus. The ETF tracking those names soaring to a Record high today. So up next we're gonna talk to an analyst initiating coverage on the sector and As we head to break take a look at the travel names Carnival Airbnb and booking all once again Among the biggest gainers in the S&P 500 today. Overtime, we'll be right back. Welcome back to Overtime. Another big day for stocks as all the major averages ended in the green. The S&P 500 and the NASDAQ Composite,

both getting within points of record highs, though not closing at them and not hitting them intraday either, but coming very, very close. The NASDAQ 100, however, did hit a new record high. That was led once again by Big Cap Tech. Apple and Tesla were the only mag seven names to finish today lower. Nike results were out just moments ago,

beating by a penny on earnings. It was a small beat on revenue as well, but the stock is slightly lower here in overtime. And as the S&P 500 does near record territory, there's some other parts of the market that are already there. That includes the defense ETF, the ITA. It's up nearly 20% in the past two months, and it's names like AeroVironment, Rocket Lab, Axon, and HowMet Aerospace that are posting some of the biggest games over that time. It's not the more traditional names that you might think of, some of the so-called defense primes,

but our next guest has some more under-the-radar top picks in the sector for your portfolio. So joining me now is Jonathan Sigman. He's steeple managing director. He's covering aerospace and defense. Jonathan, welcome to the show. It's great to have you on. Thanks so much for having me.

So I'm going to start right here with your note. You said you recommend to investors lean into the defense industry changes and throw out the legacy defense investing playbook. What does that mean? Yeah. So the title of note was reinvesting in the arsenal of democracy. The key word is reinvesting. And that's what we really haven't been doing for decades. And what we see is fundamental change, where the defense industry is going to evolve into

a growth industry. And we're most excited about the companies that today are leaning into this change, investing in new capacities, products that are cheaper and more effective, and taking advantage of this new environment. We initiated on 11 stocks in three different sections and couldn't be happier with the long-term trajectory of these areas. So when we talk about new technologies, I assume we're talking about AI, autonomy,

things like drones, who's best positioned to capture that growth? So we have three companies with direct drone exposure two of them are AeroVironment and Kratos and on that theme of investing just this week both of them hit that right on the nail on the head. AeroVironment reported results on Tuesday I think it was most noteworthy the 80% growth they had in their Lordnary Munition product line and sales growing up over 40% overall. But what I was really excited about was the increase in CapEx, 68% of sales.

That's five times what they used to spend on CapEx a few years ago. And then Kratos, just last night, announced a $500 million primary share offering. This is like the market didn't like it. It opened down, I think 7%, it kind of crawled its way up, but still down and lagged the market today. But this is exactly what we want all the companies to be doing.

Their net cash as of March 31st, and they're going to be having dry powder to invest in low-cost cruise missiles, some of their drone programs, hypersonics. Can you imagine what would happen if all the industry was incrementally investing like these guys are? So I find that really exciting. And then the third drone company I would highlight is Teledyne. They're not even categorized in aerospace and defense.

They're categorized in electronic instrumentation. But nearly a third of their business is government sales. And $900 million is in things that I would consider all new defense tech, drones, anti-drone, and space sensors. Great company. One of the conversations I find myself having with defense officials and with industry is this idea that the so-called exquisite legacy programs that cost many billions of dollars to make will still have a place, but that the mix to your point with some of these new defense technologies is changing. How much did the U.S. precision strike on Iran over

the weekend highlight that dynamic and where we're headed, especially given the fact that the Pentagon is starting to outline in a little more detail here its request for the fiscal 2026 budget? So 100% right, Morgan, it's

going to be a high-low mix, and we have examples of both. Right? The spiderweb attack that Ukraine pulled off, destroying $7 billion worth of Russian aircraft with just a bunch of drones, shows what you can do with low cost and tribunal mass in using different tactics. But then what Midnight Thunder hammer did was just a great example of what our exquisite systems that only we have and the men and women behind it can achieve.

So point taken, but we can also point to some bill payers in the budget. The F-35, the initial cuts there were, I think, a lot more dramatic than folks would think. There's been some army programs that have been reduced or cut completely,, I think, a lot more dramatic than folks would think. There's been some army programs that have been reduced or cut completely, and I think this is all going to be going to the areas that I think there's bipartisan support for drones, anti-drone, hypersonics, space technologies where we want to invest in. Yeah, Jonathan Sigmund, great to have you on. Thank you very much. Well, President Trump's one big beautiful bill is threatening the future of the offshore wind industry, but one project

is moving forward. That's despite those potential hurdles. Pippa Stevens is here with more. Pippa. Hey Morgan, as the offshore wind industry faces challenges, a whole lot is resting on projects like this one, Equinor's Empire Wind 1. To showcase, this industry can be on budget and on time. The details coming up next on Overtime. Welcome back to Overtime Solar Stock solar stocks shining today. Enphase energy, the best performer in the S&P 500. You can see right there finishing up almost 13%. That's after a senator on the energy committee says there is quote, work to be done or work

being done to revise the proposed cuts to residential solar tax credits in a more favorable way to the industry. But sticking with renewable energy, the future of the offshore wind industry is in doubt because President Trump's tax bill would eliminate federal tax credits, which are integral to launching these new projects. Projects like this one at the South Brooklyn Marine Terminal in New York,

where we find our own Pippa Stevens. Hi, Pippa. So Equinor is completely redeveloping this terminal behind me in order to support its Empire Wind 1 project that's off the shores of Long Island. Now it is a really big investment for Equinor. Five billion dollars net of credits and those credits are really instrumental. Equinor expects to recoup about 40% of its costs thanks to that investment tax credit as well as credits in the inflation

reduction act. Now, since this project has started construction, they are confident they will get that full 40%. But the same cannot be said for future projects. And that's because the tax bill that's making its way through Congress right now would slash a lot of those incentives. And that is just the latest regulatory hurdle that this industry has had to deal with. Back in April, President Trump issued a stop work order for this very project.

Equinor halted all of its offshore construction. They did continue constructing here at the South Brooklyn Marine Terminal at a cost of $50 million per week. And they were literal hours away from pulling the entire project when they got word that the stop work order was reversed on May 19th. And Morgan, when you think about these projects that take a lot of upfront capital and are very long, Lee Times Equinor first got involved here in back in 2016. If you have that sort of flip-flopping policy on the regulatory front, it just adds another major challenge that these projects have to contend with. Yeah, it's a major dynamic.

I want to go back to the incentives piece of this. If you see incentives for future projects such as this slashed in this bill, is that money that's just saved for taxpayers? It's less spending or is that money that's going to be redirected somewhere else? Yeah, so in theory it's less spending that could be redirected for other things like Medicaid, and that of course has been one of the sticking points as this bill makes its way through Congress. But if you look forward, the energy picture is really uncertain. We are seeing load growth, meaningful load growth for the first time in two decades. When you think about

electrification, reshoring, add in data centers, we need more power sources. And when you look at places like New York City, there is not a whole lot of available land for things like large solar arrays with backup storage. And so offshore wind is one of really the only viable options. Plus nuclear is a 2030 and beyond story. Look at gas turbines, you can't even get one

until 2030 at this point. And so, you know, a lot of the advocates for this industry say, why aren't we taking advantage of this free resource, which is the wind? However, in order to get that cost curve to come down, you do need those initial first of their kind projects. And so that's what Equinor is hoping this Empire Wind offshore project will showcase and then pave the way for future projects down the road. All right, Pippa Stevens, thank you. Great reporting as always Well copper prices have been soaring this year barely underperforming golds rally up next fast monies Guy Adami tells us whether copper can keep on climbing and the stocks in that space to watch and Investors are hitting the jackpot with Penn Entertainment today citizens JMP

Upgrading the gambling company to outperform from market perform The analyst there says the stock is on the verge of recovering from several long-term headwinds, which have seen shares plunged nearly 90% from the all-time high four years ago. You can see shares finished up 5%. We'll be right back. Welcome back to overtime. Let's get a quick check on some of the most notable stocks closing at new highs today. Microsoft, CrowdStrike, we had their CEO on this show earlier this week. Seagate, Royal Caribbean, and the Williams companies. Meantime, at the other end of the spectrum, the dollar index hitting its lowest level since March of 2022 today. That's creating a shakeup in some other parts of the market.

Let's bring in Guy Adami. He is a CNBC contributor and a fast money trader. I can't believe it. Great to have you here on Overtime. I can't even believe this. What's up, Morgan? I mean, this is like, this is such a thrill for me. How are you? I'm doing great. How are you? This is TV magic getting to talk to you a little early for me as well. So what do we want to talk about here in the teas? We're talking about the weakness in the U.S. dollar. Is that correct? Yeah, let's talk the dollar. Good or bad? I don't think well right now it's good. And

you know, you talk about this. Tim Seymour brings it up. Multinationals. If you think about it, the tailwind that a weaker dollar creates for them, it's clearly manifesting itself in a lot of these stocks. But in my opinion, there comes a point where this tailwind becomes a headwind. And I'll encourage your audience to go back to July of last year. Dollar Yen was trading about 161-ish.

There was a benign, well, actually a soft CPI report that came out on this Thursday. And 10 minutes dollar yen went from about 161 to 157. You're saying what's the big deal? Well, by if you remember early August of that same year, dollar yen cascaded lower and the market sort of fell apart. And that move we saw in August last year in the Dow Jones and the S&P and the NASDAQ was built on that move in dollar yen now before our eyes we're seeing something similar happen with the euro word four years four year lows for the dollar against the euro dollar yen seems vulnerable again to the downside. I think it's just a matter of time before the market wakes up to what can be a bit of a headwind for the equities market in the form of a weaker U.S. dollar. So we'll keep a close eye on dollar, euro.

I think you should, Morgan. I absolutely think you should. And I think you should be watching dollar, yen as well. Obviously there's something going on with interest rates that JGBs have had a historic move. The yen, I think it's going to continue to strengthen. And I do think there's going to be some risk off at some point on the back of that. Okay. When we see a weaker dollar dollar we tend to see stronger commodities. It's actually

happening in copper. Old Dr. Copper is having a rally here. What do you make of it? I think that's part of the story as well. I think obviously a weaker dollar is supportive of commodities but there's something else going on. There's a major squeeze going on for you all-time commodities traders. London Mercantile Exchange and Goldman Sachs just had a note out and they think copper is going to continue this rise and see levels that we last saw last summer. You remember there was a huge move to the upside and you say okay guy how does the layperson play that? That's a great question Morgan thank you for asking me. It comes in the form of Freeport-MacMoran which I think is

going to trade the levels that we last saw in 2008. By the way, as we're speaking, the great Melissa Lee is walking behind the camera. She says hello to you, Morgan. She just waved. Or you can play it with Southern Copper, which I also think is cheap.

The symbol there is SCCO. All right. I'm waving back to Mel right now. Morgan says she's waving back. Look, she's waving at you. Hi. Guy Adami, great to have you back. Look, she's waving at you. Guy Adami, great to have you on. You know I dig you, I dig John, I dig the show, the whole thing.

It's great to be with you. It's great to have you here. Well, don't miss Guy and the chart master, Carter Worth coming up on Fast Money at the top of the hour, joined of course with Melissa Lee. Carter Worth's gonna have a technical take on the S&P as it inches towards its record high. Nike's next move after earnings and why he says TJX is topping out. Well up next here on overtime Mike Santoli breaks down today's continuing jobless claims data

and what it says about the outlook for the labor market and the economy. Welcome back to overtime now let's bring back a sea markets commentator Mike Santoli he's monitoring a couple different economic variables variables ahead of next week's jobs data Mike. Yes Morgan so the weekly jobless claims of course are pretty good real-time coincident indicator of the labor market. The new jobless claims have been pretty benign and they were again this morning but the continuing claims so this is the number of workers that are continuing to collect benefits over multiple weeks has really taken a bit of a

sharp upturn here. So we're just below that 2 million markets above 1.9 million. The absolute level itself is not necessarily recessionary for contrast in 2019 before the pandemic grew around 1.7 million, but in periods of 2016 before that it was well above 2, 2.5 million. So it's not so much the level, it's the shape of this curve that suggests that hiring has really slowed down. And we know labor supply has also slowed, therefore unemployment rate remains kind of static. But this is one of those areas where people are saying,

below the surface, labor market seems like there's some softness to it. Now, countering that to some degree is that the private sector by many measures is in very good shape It's very flush and it's got a cushion against any further shocks or weakness Here's a way to illustrate it. JP Morgan puts this together. So corporate profit margins. That's the orange line You see going back, you know almost 30 years or at a record high So there's just a lot of room there to kind of maintain spending and hiring levels if companies so choose. A lot of that's going to the kind of businesses we have now.

This is the household debt to income ratio. And you see that's really gone down near the lows for this period. And what you see here is, you know, it was much higher before the global financial crisis. And therefore, you know, it doesn't create incremental stress on households and they can sort of service the debt, even though it's tough to buy a house, tough to afford things, maybe some big ticket stuff, it's not getting bought as much. So these are some of those kind of push-pull variables

that are keeping the economy in this steady but slower growth mode, Morgan. Well, as I know, we're getting PCE tomorrow. So far, the readings we've gotten this month and last month as well have been softer than expected It's been trending in the right direction or at least not going in the wrong direction In terms of price increases in the pace of them when I look at a chart like this It makes me think we keep talking about how resilient is the consumer

This is why this is why this consumer has remained as resilient as it has despite all the inflation of the last four or five years Exactly. I mean it's bifurcated of course as it has despite all the inflation of the last four or five years. Exactly. I mean, it's bifurcated, of course, as it often is. I mean, if you look at the lower 20% of income earners, they actually have less cash in bank accounts than they did before the pandemic, but every other cohort is well ahead of the game. Payroll income, the total 5% annualized growth at last monthly jobs report, you know, that can maintain spending levels,

especially as you say, when PCE inflation and CPI are well down in the twos right now. So you still have positive wage growth. It's hard for the economy to get into too much trouble while that remains the case. Okay, Mike Santoli, thank you. Well, let's get you set up for tomorrow's trade. There are no earnings on the calendar,

plenty of important economic data. We will get a key inflation reading. We just talked about it when investors digest the May P. C. E. prices index as well as the May personal income and consumer spending report and the final reading of June consumer sentiment. Stocks finish the day higher. We flirted with record highs. We didn't quite get them except for the NASDAQ 100. That does it for us here at overtime. Fast money begins now.