Closing Bell - Closing Bell Overtime: Markets React to Ceasefire Headlines, AI Job Fears and the Search for a Bottom 4/6/26

Episode Date: April 6, 2026

Former Bush 43 White House foreign advisor Dan Senor analyzes developments around Iran and a potential ceasefire. Barb Doran of BD8 Capital joins to assess market reaction and what it means for positioning. Michael Gapen of Morgan Stanley discusses how automation could reshape jobs and economic growth. Joe Amato of Neuberger Berman explains how to think about buying the dip and what signals matter most in volatile markets. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The bell's bringing an end to the trading day at the NYSC, the Barton School of Business at Wichita State University ringing the bell and at the NASDAQ, it's Winchester Bank Corp. Welcome to closing bell over time, live from Studio B at the NASDAQ market site. I'm Mike Santoli. Melissa Lee is off today. Stocks slightly higher on the day, but some intraday swings as investors balance out hopes for a ceasefire with some aggressive comments from the president hinting at possible escalation from here. much more on the markets and a live report from the White House coming up. But as Iran news dominates the markets, here are some other stories on our radar at the close.

Morgan Stanley out with a new report on the impact of AI on jobs. Is it as dire as some predictions we've heard? Plus, Open AI racing toward an IPO, we've got more news from the company coming up. And as Michigan and Yukon get ready to do battle on the court, we'll look at the battles in court facing the predictions markets. But let's begin with the markets, the numbers. Christina Parks and Nevelins is here with all of them. Hey, Christina. Hi, Mike.

Well, the Dow, S&P 500 and the NASDAQ, all coming off their best week since November, even as geopolitical risk hang over the market. Oil prices were on the move again today. WTI briefly topping $114 a barrel before closing around 112, I should say. Energy up on those oil moves with APA, EQT, and ExxonMobil leading the S&P 500 energy sector higher. There were, of course, like you mentioned, renewed peace hope says that also sparked a rebound in crypto. Shares of Micro Strategy, Coinbase, Robin Hood, all gaining at least. Well, we shouldn't say maybe not Robin Hood. They actually came down, but most of the pack over here over 2% after Micro Strategy separately also revealed it bought another 4,800 Bitcoin over the weekend.

Turning to other tech names, Seagate and Western Digital, those are two major hard drive makers. They rose after Morgan Stanley reiterated both as overweight, although they did name Seagate as a top pick. Meanwhile, Keybanks seized Micron climbing another 60% from last week's close, citing steady AI memory demand. Sandisk also closing higher today. And Intel finished up slightly. There was a wired report out this afternoon that Intel's maintaining talks with Google and Amazon about advanced chip packaging, which is a key step in their own in-house semiconductor designs. And then lastly, in EVs, Lv's.

Lucid fell roughly 5% after a Q1 miss tied to a supplier issue with Tesla, also slipping again today extending losses from last week on that delivery disappointment, Mike. Christina, thank you. Now let's turn to the bond market and its reaction to the latest on Iran as well as some economic data in the last couple of trading days. Rick Santelli joining us now from Chicago. Hi, Rick. Hi, Mike. Indeed, early this morning, 10 o'clock Eastern, we saw the data from ISM, the Martreid on the

service sector. And the metrics were on the weak side. But there was one metric that the market paid attention to. Prices paid at 70.7 equaled where we were in August. You had to go to October, though, of 22 to find a higher number, as you could see on that chart. When do we make the high yield sessions right after that number? A few minutes after 10 o'clock number, we saw the high yields. as you look at twos and tens on the same 12-hour chart. And when the presser began for President Trump, yields had started to move higher. There was a notion, of course,

that anything about the war makes the market a little bit nervous, but as he spoke, yields started to come down. And about 10 minutes before, the presser ended around 220 Eastern, we saw that the market made their low yield of the session. Now, if you open the charts up to when the conflict began on the 27th, actually the 28th of February, what you should notice is that we peaked out the last part of March at 399 on the closing basis for twos, at 443 for tens. But the real issue here is how we continue to hold those levels without going higher.

Those are the trigger points. 380s where it seems to hold on a two-year, 4-30s where the 10-year seems to hold. All things considered, the market sort of snoozed all through 10 years. today. Mike, yeah, that seems a theme across asset classes, Rick. I guess from here, naturally, day to day, we're going to react to Iran news or oil. But what are we looking toward in terms of what the bond market wants to key off of? We're going to get PCE. We're going to get, you know, other numbers, the remainder of this week. Well, to me, the big news could actually be the auctions we're going to have, reopening auctions for threes, tens, and thirties,

Tuesday, Wednesday, Thursday, Thursday, respectively, Mike. And even though they're reopening auctions, which aren't quite as intense as the primary, I think supply is a big issue. We already have big debt and deficits. The war costs are going up, even though the war may be going well.

Yeah, exactly. We got more requests from the administration to Congress for topping up that defense budget. Rick, thank you very much. Appreciate it. Now let's get to Megan Casella at the White House as the markets work to digest the president's latest message on Iran.

Megan. Mike, that's right a lot for the markets digest today. As we heard from the president earlier in the briefing room for roughly an hour and a half, and we heard him alternating, really, between threats of escalation and talk of diplomacy. At some points, he was saying that he wanted to make a deal that he thought the Iranians were negotiating in good faith, while at other times he was sort of reiterating that threat to obliterate Iran's power plants and bridges unless they agree to some sort of a deal by 8 p.m. tomorrow. Take a listen. The entire country can be taken out in one night, and that night might be tomorrow night. So couching his language somewhat there, saying it might be tomorrow night, but of course, clearly leaning towards the idea of further escalation.

Now, he went on to tell reporters that part of the reason that his messaging was wavering in this way or sort of straddling that line was because he can't give the media his plans and say what's coming next, but also because he was saying relatively that the ball is in the Iranians court. Listen to this. Are you winding this down? Are you estimating it? I can't tell you. I don't know. I can't tell.

It depends what they do. This is a critical period. They have a period of, well, till tomorrow at 8 o'clock. Mike, I'll note that earlier today. The Iranians formally rejected that idea of a 45-day ceasefire while a broader agreement to end the war was being negotiated. The president earlier in the day also called it a significant step, but not good enough. So much more to watch there on what sort of could be a good. between now and 8 p.m. tomorrow night. Mike. And Megan, obviously, you know, these deadlines have

moved in the past. Did the president say something about how he would not actually defer this particular deadline at eight tomorrow? He did. We heard from the president even before this press conference on the South Lawn of the White House during an Easter event. And he was asked there point blank, whether this would be his final deadline. And he said, yes, it would be. We've heard some things like that before, of course. This was a deadline that was initially 10 days before this. Then it was set for today. It was going to be tonight at midnight. And then sort of without acknowledging why he moved it another 20 hours to 8 p.m. tomorrow. We also don't know exactly what a deal would have to look like at this point in order for him not to move forward with this obliteration of the

bridges and power plants that he's been talking about. Would it have to be a full end to the war? Or would he be able to say there's some sort of intermediate step? If talks are still going in good faith, he hinted today that he believes they are, then maybe that would be enough to get the deadline to be pushed once again. For sure. I guess you have to treat a deadline as fine. until the very moment you put it off, but that's what we know so far. Megan, thank you very much. Megan Kisela. So what are the likely next steps ahead?

Joining me now is Dan Cienar. He was a foreign policy advisor in the George W. Bush White House, as well as to the 2012 Mitt Romney presidential campaign. Currently hosts the Call Me Back podcast and serves as chief public affairs officer at Elliott Management. Dan, great to have you on. Great to be with you. Would you hear today that perhaps move the ball or not from the president? I think the president is, as he's done since the war began, is maintaining his options.

But it does feel to me, Mike, that we're headed into an escalatory mode here, simply because, I think from Iran's perspective, from the regime's perspective, it's unlikely that they can agree to some kind of ceasefire that meets all the objectives that the administration is asking for, especially an open-ended ceasefire, which is what a 45-day ceasefire as Pakistan has proposed, would basically amount to. given that it was in the context of negotiations that the U.S., I believe rightly, but the U.S. did attack Iran and Israel attack Iran twice while there was some kind of conversation, some kind of dialogue going on back in June of 2025 and then just about five weeks ago. The flip side is the administration can't agree to any kind of ceasefire or kind of interim, you know, set of talks if at the core of them there is not a suspension and outright end to, Iran's nuclear program, its missile capabilities program, the industrial base that produces the missile capabilities. So I do think we're stuck here, and the president today is clearly escalating. And I think he'll follow through with it. If it gets pushed off a day, another day, again, he always maintains his options,

but it does seem just based on you look at the kinetic activity since the launch of Operation Epic Fury, that that is the path we're on. And if escalation from here, Dan, does take the form of, you know, attacking civilian infrastructure and trying to, you know, damage the power generation capacity, oil, everything in this country. I mean, what's the, what's going to be marked as the success in that stage of this campaign? In other words, is it just whatever it takes to have Iran agreed to the set of demands as we've laid them out? So I don't, I'm uncomfortable having a speculative conversation about which specific target would make sense.

And I would be, and I'd also be cautioned against using the word civilian. Look, there are dual use assets and infrastructure within Iran that the regime controls, that, yes, has some civilian application and also is used in the context of war fighting. So I think the Pentagon will probably pick targets. Again, I don't want to get super specific, but there are targets that are necessary for Iran to maintain its military capabilities and its warfighting. and the rebuilding of those weapons and both offensive and defensive capabilities that have been set back as a result of this war, like bridges and other areas of just land infrastructure that the IRGC and the besiege security force and the regime need in order to go forward.

So I don't want to get super specific because I think that's a dangerous game. And I also think whatever is hit, I think the first order of targets would be ones. that could be justified as being dual-use capabilities. You mentioned the core objective of having Iran essentially abandoned its nuclear ambitions. But the president today also talking about, hey, if anybody's going to be taking tolls in the straitship of the U.S., we should just go take the oil. I mean, there's a lot of this rhetoric out there that it seems like it's directed at a little bit, you know, beyond simply, let's make sure that this threat is neutralized. I think there is creative trial balloons being launched right now, some of which you heard in the press conference today, I think some of which we'll probably hear the next few days, that relate to two areas. One is how to deal with the Strait of Hormuz and how to get it fully functioning again.

So that's one area we're going to start hearing some creative trial balloons. And the other is on this 440 kilograms, about 1,000 pounds of highly enriched uranium that the U.S. really. wants to get out of Iran one way or the other, or at least neutralized, before this war is over, which is the key asset that we understand Iran has that if it were to restart its nuclear program, that that is going to be a pretty valuable ingredient. And I also think there's going to be some creativity in that area, too. So yes, the president, as he often does, is throwing out some ideas here. I think some of them are actually being developed. And some of them are designed to keep everybody guessing and keep everyone off kilter. And as I said earlier,

or just maintaining his optionality. If I'm listening to this through kind of the market's ears, which seems like it's been trying to stay close to the possibility of a near-term climb down and de-escalation, and maybe we can kind of have things flowing by the middle or late this month, you seem like you're pushing against that notion. I'm not pushing against it. I'm just saying I think there's going to be an uptick in kinetic activity

before there's a down-tick. So then the question is, what's your time horizon? But I just don't think we get to a downtick before some uptick from where we are now. Yeah, fair enough. Dan, really appreciate it. Thanks for having me. All right, let's dig deep into the markets. Our next guest says geopolitical uncertainty suggests a wait and see attitude may be the best course of action for now.

Joining us now is BDAD Capital Partners, Barbara Durant. Barb, good to see you. You know, it seems like the market is in tune with what you're saying, waiting and seeing like we're up. the lows, but we definitely haven't cleared too many hurdles. It doesn't seem like there's some high conviction money running through the market, at least today. What do you do while you wait? Just kind of what you were sitting in before or looking for other things to pick up? I think it's a good question because things have changed. I mean, for a while there, it was so volatile. You know, everybody was betting that it's going to be short term. And I think the market still is.

And frankly, I still am too. I think you're hearing an increasing tone of desperation out of the White House, and even if Dan is right that he's sensing we will escalate here, it's still, I think, considered short-term. It's to rush to a conclusion here. So I think that's going to be, you know, that the market will say, okay, that's, it's going to be over soon. And then we can resume, you know, where we're going, which is start of the year very bullish.

Now you have also continued fiscal stimulus from the defense spending. Sure. You know, so, you know, things I look in charge. I do wonder how much of a rethink we need to. I mean, earnings estimates have continued to go up. largely, that is still a technology story in terms of the magnitude of upside. And yet technology, broadly speaking, has not necessarily been able to kind of shake off a lot of the top-down pressures from the conflict.

No, that's right. And I think, you know, part of that is we know going into this, you had concerns about software. Suddenly, AI is going to replace everybody's business model. Then you had it with a hyperscale, it's concern that the CAP-X, where are we ever going to see the ROI? I think... Oh, you know what, Barbara, I do want to point out. We do have the CBO close happening. right now we wanted to show you that it is the closing bell at the CBO in

Chicago it does end the regular trading day for options for 15 every day sorry about that but we did work that in yeah no I'm just saying there were some you know a couple big issues before this and I think that added fuel the fire because we came to the year with full valuations on a lot of these technology stocks full if you think that they're not going to be increasing their earnings but they likely will be and we know this their free cash flow is going to continue and so and as we've talked before the last few years they're always a source of but taking people rotate into cyclicals, whatever it is.

I think that's what's happened here. You've seen them get very inexpensive compared to the historical averages. For sure. I mean, NASDAQ 100, its valuation relative to the S&P is at multi-year lows. I do wonder within it. I mean, right now it feels as if the AI trade continues to kind of narrow down to the things we can absolutely rely on, whether it's currently memory, optical components, and then I guess some of the power generation. Is that where you stay or do you look at what's been less behind?

Well, I think, you know, you can do both ways. I mean, if you look at what's left behind, we're still going to have that uncertainty, as we've discussed. We're not going to know how much AI is going to replace. But I think, you know, the market, as we know, when it doesn't know, discounts the worst possible case. So you can look at individual business models and say, okay, the risk reward here is it interesting. There's probably not a lot of downside if I'm wrong, but potentially great upside. So I think that's where you've got to look in those areas. And then in terms of the economy, I mean, there was a sense going into this,

conflict that, you know, oil, there's the level and then there's the how long it stays there, and then it's the knock-on effects, and it's how the economy kind of absorbs it. So are we, do we still have a cushion in terms of U.S. growth, do you think, or are we using it up? Right now, it looks like we do. I mean, again, it's what everybody's saying, how long is this going to last? And if it lasts a few more weeks, three weeks, four, I think would have to last, you know, more than a few months before you really start to see the impact. And, of course, the rest of the world, they are seeing the impact, particularly in the oil importing country. but we have the luxury of not being, you know, a net oil exporter.

And we also know what we started the year with in terms of what the stimulus, what the tailwinds that we have, and those are still there. Yeah, it's true. Actually getting the real-time info on tax refunds or even running a higher than some expectations, so maybe that is an offset. I guess the other real question here is in terms of, I guess, the overall thing of whether we are in this interim where the companies have, haven't spoken because earnings haven't happened yet. Nobody's been updating their guidance.

Do you think that we're in for an air pocket or is that going to be reassuring? I think it's going to be reassuring basically because it's only been six weeks. And so any impact, you're going to hear from the airlines, although typically they hedge out their oil prices. So I think I expect the earnings and the margins will be strong and good as expected, but it's going to be everybody's looking for the commentary. You know, what are they starting to see? How much can you project out on it? But again, it's going to be that uncertainty. How long is this going to last with oil prices, nearly double what they were. Yes, very rare to actually have oil prices double and not break something

along the way. We'll see how it goes, Barb. Good to talk to you. Good to talk to you. Thank you. Up next, we've heard some dire predictions on how many jobs will be killed by AI. How worried should you be? Morgan Stanley is out with a new study. Those details are coming up. You're watching Closing Bill Overtime live from the NASDAQ market sake. Welcome back. Merger Monday in biotech, Neurocine Biosciences, is buying Salino Therapeutics for nearly $3 billion or $53 a share. This gives neurocreen growth in the rare disease market. Salino's lead product is focused on treating Prater Willie syndrome, which is for more on

rare diseases, please visit cnbc.com slash cures. J.P. Morgan's CEO Jamie Diamond published his annual letter earlier today in which he cites several risks the company is navigating, including artificial intelligence. Diamond calls the technology transformational, but warns it will definitely eliminate some jobs. Those comments come as several companies, including Oracle and Pinterest, have announced AI-related layoffs. Meanwhile, Morgan Stanley is out with a new note today measuring the AI disruption in the labor market. The firm writing that the data points to narrow displacement while aggregate disruption remains small. Joining me now on set is the author of that note.

Michael Gap and Morgan Stanley's chief U.S. economist. Good to see you, Michael. Thanks for having me on. I would love to set the scene a little bit because you go deep on just how to frame this AI investment boom. in the context of previous technology waves. So are we pretty certain that this is going to qualify as one of those absolutely kind of era-defining investment booms? I think we have more confidence in saying yes to that

than we have in saying exactly what it will look like. But yes, I think it would represent the sixth major innovation wave that the U.S. has had since going all the way back to the Industrial Revolution. I think we feel pretty confident saying we're in the early stages of the sixth one. scale of the investment, and I suppose the speed at which a lot of this development has been happening and people finding practical uses for it and all the rest of it naturally creates

this idea that it's moving so fast, people are spending so much money, it better disrupt something. Is it going to disrupt the labor market? That's right. Well, all the five prior waves did. And certainly the amount of capital expenditures today and that we anticipate for this year is massive. It's about two and a half percent of GDP. But we did between one and two and two and a half percent of GDP for about 50 years during the railroads. So there's historical precedence for this going on for a very long time. But will it disrupt the economy? Will it disrupt the labor market? Absolutely. All of the five prior innovation waves did. The question is how transformative will this one be and will it be different? And are you able to discern it in the here and now much in

terms of, you know, we keep talking about this low fire, low higher job market. There are other factors clearly involved besides AI? I'd say, when we look at the labor market today, do we find evidence that AI is disrupting it? Yes, is it showing job destruction in a way that would push the unemployment rate higher? That's a lot harder to find, right? What we do in one of these reports is break down occupations by AI exposure. Now, the unemployment rate across all those occupations has drifted higher over the past 18 to 24 months. But, occupations have different cyclical sensitivities, right? So once you wash that through the cyclical, you control for cyclicality, we do find some evidence that occupations that are highly exposed to AI

are seeing higher unemployment rates. But you really have to drill down, and we find that the overall magnitude is maybe about a tenth of a percent on the unemployment rate. So it's, the evidence is micro. You're not really seeing it broad base. It's there, but you have to drill down pretty deep to find it. That doesn't mean it won't be transformative or revolutionary going forward. It's just hard to find it right now. I mean, it seems like in an economy where you have, what, a couple hundred thousand people a month retiring essentially, there's scope for companies to, you know, through attrition cut costs or find other ways to do things. So you're projecting exactly what the impact might be down the road or it's just like, look, we don't know what new industries

and jobs are going to be coming to offset the ones that are lost? I think our standing view right now is that AI will most likely be like the five prior waves. It will reshape what the underlying industry of the economy looks like and what the labor market looks like. It will destroy some jobs and create new ones. I suspect that means the total level of employment can stay the same, but that's going to depend on a lot of factors. So our view is that today is probably going to be like the past, but we don't know.

This time, it could be different. Sure. I also imagine, I mean, you look at those prior waves. At some point, they all either created a big malinvestment problem or financial markets got distorted in some way, eventually. That's right. So that's the other message we've been bringing is you can't, well, history would say. You can't get all the benefits from AI without the boom-bust cycle. Yeah.

So with the success, the winning technologies and its diffusion will come the losers. So is this an overinvestment cycle? History would say absolutely. And you can't have one without the other. And then just to knit it to, I guess, maybe the more here and now, what's your take on just exactly how the economy can navigate oil where it is and what it means for the Fed at this point? At the moment, I think it's a headwind. I think there's kind of enough residual growth and momentum in the economy that the movement up in oil prices. that we've seen is it'll have a direct negative effect on purchasing power.

But to get a major downturn or even a recession, you would need equity markets to correct a lot more. You need more evidence to suggest that businesses are postponing, hiring, and spending. We're not seeing that. So I do think there's enough momentum more at the moment. This is a headwind. For the Fed, I think that our strong view is the Fed's not hiking into this. The view is the Fed's either on hold or cutting rates. So it'll depend on the mix of the unemployment rate and inflation.

At the moment, we have the unemployment rate rising to 4.7 in our forecast that would bring cuts later this year. If that doesn't happen, then I think the Fed's on hold. Yeah. And did Friday's number really alter that at all? A little bit. Yeah, reset it lower. Reset it a little lower. Now, about half of that move, maybe a little more, was due to a falling participation rate. The employment to population rate fell.

So it was a bit of a mixed report, but on that it was strong. Yeah. And does kind of point to some modest improvement in hiring in the first quarter. So, Annette, that shifts the burden in the direction of inflation has to come down to get Fed cuts later this year. And then they just stand pat. Right. Michael, thank you. Thanks for having me on.

Michael Gapen. As OpenAI gets ready for an IPO, it's out with new claims about some high-profile people. Those details are coming up in overtime. Stay with us. Welcome back. Chairs of Starbucks, a winner today. the company completed its joint venture deal in China with Boyu Capital, which was initially announced last year.

Boyu now controls 60% of Starbucks China retail operations. It's about 8,000 locations with plans to grow to 20,000 over the long term. Starbucks shares are up more than 10% this year. The stock has not had an up year since 2021. Now, as Open AI gets ready for a potential IPO this year, lots of news coming out of the company. Kate Rudy covering it all for us, Kate, including some fresh stuff here. Yeah, Mike, we are just hearing that Open AI sent a letter to the California and Delaware attorneys general. This happened in the last hour, urging them to investigate what they call improper and anti-competitive behavior by Tesla CEO Elon Musk, who was an early backer and co-founder of OpenAI.

We also are hearing about meta-CEO, Mark Zuckerberg, in this letter. Company alleges that Musk has been working to what they say was undermining Open AI through various attacks on the company, including coordinating his efforts. with Mark Zuckerberg. I just got off the phone with an executive at OpenAI. Chris Lehane. He's the head of global affairs over there calls this possible collusion between Musk and Zuckerberg. He pointed to recent text messages that became public through this lawsuit's discovery process. Those were between Zuckerberg and Musk.

Musk in these asks Mark Zuckerberg for his help in trying to acquire Open AI's nonprofit arm. Musk, according to Lahane is potentially in quote, cahoots with Zuckerberg. He says the focus here was on. on trying to seize a $100 billion nonprofit, says the Musk is seeking to obtain the nonprofit for his own personal gain. He also pointed to some new reporting in The New Yorker over the weekend,

says that Musk, in his words, conducted extensive opposition research about Sam Altman. The New Yorker really details this, including tracking flights, other movement, and also they say that he had a role in circulating false allegations about Altman's personal conduct.

Lehane says, given the public interest, in all that's implicated here. He says the top law enforcement officials in these states need to take a look at the issue. Musk left Open AI back in 2018 after trying to buy, basically convince executives to buy Open AI and merge it with Tesla. That didn't go through, of course,

claims that he was manipulated and deceived after the AI company later explored converting to a for-profit. That is really the crux of the lawsuit. Jury selection for this high-profile trial between Musk and Open AI. Mike is slated to begin on April 27th. to you. Yeah, so it seems like, I guess, from opening eyes perspective, some timely revelations

of potentially some new material here that could be used in their favor. Remind me the texts between Musk and Zuckerberg, they're what? Maybe a little over a year ago, is that when they were? Yeah, and over a year ago, and in these, Musk says essentially, hey, would you want to help out? And Zuckerberg says sort of, let's hop on the phone. There's nothing. Although Le Hain called it a smoking text and sort of a smoking gun, I would say at least on Meta and Zuckerberg's side, I wouldn't say that's the case. But clearly, Musk is looking for partners, for allies to try to. He has made, in this process, they really outline an effort by Musk to try to acquire at various points in time over the past almost decade to try to merge it with Tesla, try to take control of

open AI in certain ways. And they're now saying this is for the public interest. They're involving the AGs here saying AI in general is a, of the public interest in any acquisition, you know, rises to the level of the AG's needing to take a look here. But it's become quite personal, too, between Musk and Altman. Oh, sure. Yeah. I mean, I think it kind of started that way, maybe pretty personal. And I guess interesting, I mean, you would go to state attorneys general where you think they might have an interest in maybe scrutinizing these types of relationships as opposed to the feds. Also fascinating that so many things are converging here, which is Musk's,

other companies, SpaceX, which has his AI business in it, is trying to be first out in the mega IPO race. They claim whatever. Reports a $2 trillion market cap. Who knows? And then Open AI, of course, thought to be not too far behind, trying to make demands on public capital to keep growing. It's such a good point at the same time that you have this lawsuit playing out. We are about to get, in June, a SpaceX IPO followed by, from what I'm told, Q4, could come an open AI IPO. So you're seeing, at the same time, you know, Musk's big company, plus you've got XAI, sort of the, and his AI firm that is sort of seen as a competitor to Open AI going public. You have to wonder, too, about certain banking relationships. This has gotten so personal, and bankers that I've talked to

who have said there could be a world in which one of these companies, or Musk says, hey, if you're going to run the road show for SpaceX, you can't work with Open AI. So things have gotten so petty that I think a lot of bankers aren't there, wondering how this fight in court sort of spills over to the IPO market if it does at all. And that's definitely something to watch for the rest of this year. Yeah, I doubt any of the folks involved would forego any advantage they could try to try to grab in this competition. So it's fascinating stuff, Kate. Thank you very much. Thanks. All right. Time for a CNBC News update with Brandon Gomez. Hi, Brandon. Hey, Mike. Yeah, Amazon confirmed today that it has reached an agreement on deliveries with the U.S. Postal Service.

According to Reuters, the deal will retain about 80% of Amazon's existing deliveries, which amounts to about a billion packages a year. Royders reported last month that Amazon had threatened to cut its business by at least two-thirds over a last-mile delivery dispute. Amazon is the Postal Service's biggest customer. The FAA said today it's proposing to hire 2,300 air traffic controllers as it confronts staffing shortages. At the end of September, the agency said it was short by 3,500 fully certified controllers, with many of the current staff working mandatory overtime and six-day weeks to cover the gaps. And the AI-Based, boom is increasing home values in San Francisco. According to brokerage firm Compass,

the median price for a house there jumped to a record $2.15 million last month. That's an 18% increase over last year. Condo prices also surge rising to $1.36 million, a 27% increase there, but still shy of its April 2020 peak. Back to you. Brandon, thank you. All right. Stock's holding steady today, despite some inflammatory comments from the president, markets holding out hope for a deal or at least a ceasefire. The S&P 500 down 5% for its recent high. So does that make it a buying opportunity? Overtime. We'll be right back. Welcome out to closing bell overtime, live from the NASDAQ market site. Small gains for the markets today, 165 points for the Dow. The S&P 500, NASDAQ and Russell, all rising about

half a percent. Despite all the news on Iran and the president's comments, oil, up only slightly on the day. Energy, one of the best sectors on the day, along with the consumer-focused groups, discretionary and staples, both were gainers. So should investors view the market uncertainty as a buy-the-dip moment or a warning sign? Let's bring in Newberger-Burman Group, President and Chief Investment Officer Joe Amato. Joe, good to see you. I mean, it could be both at once, I guess, depending on your tactical orientation, your time horizon. Has the market sort of repriced to a point where the direction of surprise is positive in terms of resolution, or are we already baking that in?

Well, we've had a decent bounce, right? You know, we had a 5% or so bounce last week. We're now only down less than 5% from the beginning of this, you know, conflict. That said, if you go underneath the surface, 20 to, or I should say 40 to 50% of the stocks are 20% below their one-year high. So you've had a lot of carnage below the surface, even though the indices broadly are not much lower. And reflecting, in fact, I think people do think a resolution of this is coming sooner rather than, later. It does feel that way. And I think you can always, I always like to play the game of what year is it. Some people say, well, it's like 2025. We had this first quarter early April gut

check. It was severe. We thought it really was a game changer with the tariff panic. And then you had almost a V bottom once you de-escalated out of that and the economy was fine. Yeah, 2022, you had an oil spike. And that was kind of just the beginning. And the Fed had to get, you know, a little bit tighter than expected. So, I mean, not that it's either or, but how are you leaning. Well, I think each of these years have had idiosyncratic issues, right? In 25, you had actually an almost 20 percent drawdown, right? That's for sure. Post-tariff. So it was a much more significant decline. In 22, you had a combination of an oil spike, but rate rises, inflation picking up. So, you know, each year, each of these situations are unique in and of itself. But, you know, when we

began the year, we were optimistic about nominal and real growth, you know, looking both globally and in the U.S., right? So I think we're going to get back to that discussion, right, in the context of the underlying fundamentals, which remain, I think, from a trend line reasonably positive, despite all the bad news that we're dealing with and the challenging issues that we're in the midst of, which is sort of like the fog of war right now. I guess one of the questions is whenever, you know, we sort of emerge from this phase of uncertainty about the conflict is, are we going to resume the patterns of before? In other words, it was non-U.S. equities over U.S. It was a broader market. It was value over growth. Or has this period been something that scrambled that relationship?

I think if you go back to an environment where the expectations for higher nominal growth, I think that broadening out theme, which was one of our themes as we entered the year, I think that broadening out theme is going to be quite relevant again. because in a higher nominal growth environment, economies that are more cyclical, so you think outside the U.S., whether it's Japan, China, others, stand to benefit more from that. Small mid-cap, which tend to be more cyclical, right? So that broadening out theme is important. Now, we've seen a revaluation of some of the U.S. large cap and some of the MAD 7 stocks, so they start to get a little more interesting when they're trading at more rational valuations. I mean, I guess the conventional wisdom, which is correct, is that if oil stays up here, that seems to bite more. and non-U.S. growth, at least many economies outside the U.S., and they had been some of the stronger ones, right? Like some of the Asian economies based on the memory chip trade and other

things. So how does that weave through the outlook? I think it comes back to the duration of this conflict and to what extent oil prices remain at higher levels. And demand destruction, I think, can come in two forms. One is an extended period of higher oil prices. So then consumers, whether they be here or outside the U.S., think differently about what they're spending money on, and that could slow the economy down. The second is just pure shortage. If you don't have jet fuel, aircraft are not flying, right? So even if prices don't stay at a much higher level, so we do have to monitor both of those dimensions

of what demand instruction can be. But certainly the economies, to your point, outside the U.S. are a bit more vulnerable. They're more cyclical, the more dependent on imported oil. what's your read on how investors, how clients have navigated this? Because there was so much talk early part of the year is the individual investor is just resolute and buying every dip and the risk appetites remain high and it's a different type of investor today. I'm seeing some outflows.

You're seeing some people wonder if this is a game-changing event. So how has that been manifest in your book? We serve a wide range of clients, primarily institutional. I think they're taking more of a wait and see. Yeah. And the advice we've given them is stick to your strategic allocation that you began the year with and use these pullbacks as opportunities to reinforce those allocations that you are looking at for that more two to four year, one to three year time horizon, which they're focused on. Yeah. Joe, good to catch up with you. Thank you. See, Mike. Appreciate it. Joe Amato. Up next, fast money's Tim Seymour on what investors need to be buying right now if the market is at or nearing a bottom. Welcome back to overtime. The S&P 500 rallying for a fourth straight day. So is this the market

rebound investors have been waiting for? Tim Seymour is with us to share what he's got his eye on. He is CIO at Seymour Asset Management and a fast money trader, Tim. Good to see you. It's a big if, obviously, if the lows we saw, you know, last week are going to hold here. A lot of times you get these quicksilver moves off a low. I mean, what would you be looking for in terms of asymmetrical type trades? Well, yeah, the V bottom, which we have seen before, you know, part of the problem is I think there's more inflation out there than we expect. We heard that in the ISM today. Price is paid. You know, pick the economic data release we've had.

But I do think that let's get back to valuations. And for a longer-term investor, especially looking at where the highest quality growth has come from in the market, we haven't been at this relative valuation to the S&P in a long time. And so even it's hard to reach in there and grab Microsoft. but at 21 and a half times earnings. And I think more flexibility on CAPEX, I think a frontier model that could change the game a little bit in terms of co-pilot and the disappointment there and how exciting the story could be.

I think if you look at mega-cap tech, Taiwan semi is probably the cleanest AI demand story. I realize for a lot of people investing outside of the U.S. is not as simple. But valuation-wise, we're in a really interesting spot. And we're about to get into earnings season. And I know the jury's out on 335 on the S&P earnings, whether we get that or not. Sure.

I also, you know, so many people were kind of buying into the Japan story going into this, obviously. I was one of them. For reasons, exactly. For reasons, we can all understand there's a bit of a jolt when we got the conflict and what happened with oil. But I don't know. I think people still re-uping in that direction. Yeah, 80% of consumption is imported for Japan. So they have one of the biggest impacts.

We saw Japan. We saw Korea. But the story in Japan, especially for more broadly international markets, is this is a country where corporate governance is, really improved, payout levels, corporate reform. You've got deficit spending in Japan, Takeichi, that trade is good for investors here. I think we're all worried about the pace and so therefore the speed of a yen revaluation and JGB yields. These are the big unknowns, but right now, what's been happening with the yen has been a great trade for Japanese exporters. I like Japan. I think you have to be careful, but Mitsubishi Bank and whatnot is a name we own in Idevo.

And the place, people been asking for some inflation. We're getting a little bit. We'll see how much we can deal with. Tim, good to see you. See in a bit on Fast Money. All right. Health insurance stocks, ripping higher in after-hours trading. We'll explain why when overtime returns.

Health insurers, United Health, Humana, and CBS Health are soaring after-hours trade. The Centers for Medicare and Medicaid services are out with their 2027 rate increases for Medicare Advantage and Part D payments. CMS plans to raise payments to Medicare insured. insurers by 2.48% next year. These stocks got hit in January on reports the Medicare Advantage payments would basically be flat from the previous year. Joining us now on the phone is Missouho Healthcare sector strategist Jared Holtz. Jared, clearly, I mean, the market was not expecting this. How enduring an impact do you see this having? Hey, Mike, thanks for having me. I think at least over the short term, investors can breathe a sigh of relief. This has been

an incredibly tough space to get right. The stocks have been pretty, pretty lousy traders at best all year and in prior years. So you finally get some good news. I feel like over the short term into earnings, and we'll get a little bit more color, obviously, as the group reports. But I think over the next few weeks at least, these names should trade well. Yeah. And do you think it's a matter of what, you know, in terms of talking to your clients, was everybody essentially kind of underweight or confused by this and feeling like it was dead money, or how does that play through? I think so. I mean, the cadence of events over the past couple of years has been mostly negative for this group. And so I think the degree of confidence heading into the final rate, even though

the bar was at zero percent, was kind of low, because we really didn't have a lot of color. it's difficult to sort of to get a good grip on what the final rate may be. So I think to answer the question directly, I think definitely underweight. I think there's some short covering going on. And then finally, like maybe we're in a situation where you've got troughs on trust, you know, multiple and earnings. And so the stocks can run a little bit. I guess these names also sometimes are susceptible to, you know,

the medical cost numbers getting out of hand for short periods of time. You feel as if there's makings for within healthcare rotation in this direction, or is it just going to be a little bit of a one-time repricing? Yeah, I mean, getting the utilization stuff correctly from a trading standpoint has been fair now. I mean, the biggest part of the problem for managed care over the past couple of years has been aligning costs with revenue and getting that to match up well, considering how hot utilization has been. It seems like maybe it's tapering off a little bit. You know, even gradually would be a big deal for these companies. So if you sort of marry that up with the better rates, then I think we're in a position

where, yes, maybe you could see some rotation. But again, you know, there's a lot of PTSD with this group. I'm not really sure people want to own it long term. So I think for a trade is good. All right. Well, it is right now for a trade pretty good. Up around 10 percent, most of those names. Thank you, Jared Holtz.

That's going to do it for overtime. Thank you.