Closing Bell - Closing Bell Overtime: Politics in Silicon Valley 11/04/24

Episode Date: November 4, 2024

From the open to the close, “Closing Bell” and “Closing Bell: Overtime” have you covered. From what’s driving market moves to how investors are reacting, Scott Wapner, Jon Fortt, Morgan Brennan and Michael Santoli guide listeners through each trading session and bring to you some of the biggest names in business.

That bell marks the end of regulation. S&P Global ringing the closing bell at the New York Stock Exchange. Aries Capital Corporation doing the honors at the NASDAQ. Here's the next session on Election Eve for the sectors. Utilities a big loser. Energy a big winner. Technology about flat. Dow, S&P, NASDAQ all losing ground, but small caps going out with gains. That's the scorecard on Wall Street, but winners stay late. Welcome to Closing Bell Overtime. I'm John Ford with Morgan Brennan.

We have got such a big hour of earnings results ahead. Headlined by Palantir and NXP Semiconductors, along with wind, Cleveland Cliffs, and more. Plus, two ways the election could impact your portfolio. Venture capitalist Bradley Tusk weighs in on Silicon Valley's rising influence and how tech and crypto could be affected. And Raymond James policy analyst Ed Mills will be with us to talk about how the White House result and the makeup of Congress could change the market narrative. But as we await today's earnings results, let's bring in Bespoke Investment Group co-founder Paul Hickey and Kobesi letter editor in chief Adam Kobesi. Adam, good to have you. Paul, good to have you. Adam, so markets,

the S&P 500, it's hung in there above 5,700. You think that bodes well? We're getting to 6,000? I think so. I think we're maintaining our call that we're heading to 6,000 before year end. And I think regardless of what happens tomorrow with the election, we're heading higher. I mean, if you look at the data, historically speaking, 83% of election years have had positive returns overall, with around 80% into Election Day being positive. After Election Day, it's around 70% positive from there to year end, with an average gain of about 4%.

So you put that on where we are now, and that puts us right around 6,000. I think it's going to be viewed more as a de-risking event and a reason to keep buying, and right now we're not fighting the to be viewed more as a de-risking event and a reason to keep buying. And right now we're not fighting the trend. We could use some de-risking just overall, not even just talking about stocks there. Paul, Palantir and NXP, among the names reporting, Palantir is an expensive high flyer, high bar. NXP is tied to the sluggish auto industry. What do we learn, do you think, from the way investors react here? So I think if you, I mean, it obviously depends on the results that come in and the reaction. But, you know, you look at Palantir as a stock where the valuation is pretty rich here, you know, trades of like 100 times earnings.

But then the stock has been such a high performer and growing so much. But Wall Street sentiment towards the stock is actually very weak. There's only four buys on the stock, ten holds, and seven sells, and I think the average price target is about 30% below where we are now. So these types of stocks, Palantir has the best mousetrap of these enterprise software companies. They're growing, they have exposure to the government side and growing

very fast on the commercial side. And I think these companies, they're always criticized for their excessive valuations, but you never get these types of stocks at cheap valuations. I think as far as NXP goes, Seema was talking earlier in the last show about how they have a very, very exposed to automotive, which has been very weak. So I think if you can get any sort of positive reaction in that stock from results that are unlikely to be very positive, that would show a, you know, an underlying bid in the market here. We'll have to see what auto means for Cleveland Cliffs, too, which we're going to get here in just a few moments. But we have win results. Those are out. Contessa Brewer has the numbers for us. Contessa.

Yeah, Morgan, you're seeing the stock dropping here. Win Resorts has missed on earnings at $0.90 adjusted per share versus the consensus estimate of $1.01. Revenues for the quarter came in at $1.69 billion, just shy of the $1.73 billion the street was expecting. Adjusted property EBITDA comes in light, $538 million versus the street1.73 billion the street was expecting. Adjusted property EBITDA comes in light, $538 million versus the street account. Consensus estimate of a little bit more than that. Okay, so only Boston has beat here on estimates. The board has now authorized as well nearly

three quarters of a billion dollars in buybacks, bringing the total to a billion dollars. On the call, I think we're likely to hear a focus on how much the business is changing in Macau from VIP to premium mass and mass. We saw room rates this quarter reflecting a notable drop in the average daily room rate. And in Las Vegas, not only were the casino numbers softer than last year's, but the same bad luck that hit some of Wynn's neighbors on the strip apparently hit the tables and the slots at Wynn, too, this quarter. I had no idea that luck was contagious. The stock down two and a third percent in after hours trading, guys.

All right. Contessa Brewer, thank you. So, Adam, I'm going to come back to you because I think one of the most you just talked about de-risking. We're heading into this election. I think one of the most interesting moves in the market today was the fact that we saw Treasury yields tick lower. It does seem to be there's some de-risking in the bond market. We've talked a lot about the so-called Trump trade. Given the Iowa poll that we saw that I think surprised a lot of people over the weekend

for what polls are worth in this day and age, how much is that affecting the bond market? How much do stocks take their cue from Treasuries moving forward, particularly post-election? So we've had two big drivers here. I think one has been the Fed all year for the last couple of years, actually. And then more recently, you started to see as Trump's odds of winning the election kind of went up in prediction markets and the DJT stock itself, the Trump media stock, you saw Treasury yields literally moved up in a straight line with those odds. And then when they pared back, now we're starting to see treasury yields pair back a little bit, which is interesting.

I think regardless, again, of what happens and this being viewed as a de-risking event, I think attention also shifts back to the Fed after the election. And right now, we went from a Fed that had 250 basis point rate cuts priced in before the end of the year to now people calling for maybe 125 basis point cut, maybe two. We think 225 cuts. And even in the Fed fund futures markets, you're seeing a rising 10%, 15% chance of maybe not even an interest rate cut this week. And obviously, it's still an overwhelming majority saying 25 cut. But I think now we're starting to see Fed expectations are kind of topping out a little bit on the hawkish side and pulling back. And I think as that happens, you see more strength in bonds. And the bond trade, which has been just hated for the last month and a half, is very overdue for a bounce.

So we're actually bullish on bonds here. OK, well, we've got more earnings out. Palantir results have crossed the tape. It's a beat and a big raise for the AI software company. Earnings of 10 cents adjusted for sure. That was a penny better than expectations. Revenue, 726 million. That was also a beat up 30% year over year. Palantir forecasting Q4 revenue of 767 to 771 million million. That's higher than analyst estimates. Adjusted free cash flow in excess of a billion dollars for the full year. 2024 U.S. commercial revenue raised upwards of $687 million.

That represents a growth rate of at least 50 percent. So for the quarter specifically, this is a U.S. story. U.S. government up 40-over-year to $320 million. U.S. commercial revenue, a 54% year-over-year to $179 million. 104 deals over a million dollars closed in the quarter. Customer count of 39% year-over-year. All, I might add, with almost no marketing or sales team. I spoke with CEO and co-founder Alex Karp. He says the results show that the value in AI is in the management of large language models as opposed to the creation of them. That, quote, the winners in AI will be

powered by Palantir and the losers will read analyst notes. In his shareholder letter, Karp saying, quote, this is the software century and we intend to take the entire market. So I asked how Palantir plans to do that. Karp pointing to the defense side, a shift to software driven with hardware dominated military environment, the case in point, Maven, which is deployed in the Middle East. On the commercial side, saying any vertical with complex operations is where they're seeing adoption, hospitals, manufacturing, logistics, to name a few. Karp saying, quote, what I want you to tell people is we need to invest even more in the government space and in industry and implementing AI that is actually changing

our enterprise because this is how we make America even stronger and there is no real alternative to us. He says it could be called almost U.S. AI that, quote, our bias on this is so differentiated from the market, although apparently people in Silicon Valley are starting to understand this. But it's just giving a structural advantage to America first and our allies second. You can see this on the battlefield. You see it in U.S. industry. The inverse of this, you see it in the sluggishness, lack of perception and general malaise in continental Europe. But it's a tale of two worlds, the AI driven world and the AI rejecting world.

So if you take a look at shares of Palantir, they're popping right now. They're up 11 percent. The bar was high here. The stock's up over 140 percent this year. It's up more than 580 percent from late 2022 lows of six dollars a share. And Adam, I'm going to go back to you on this one because this has been a retail darling, but I know everybody talks about it as, you know, software company, software, you know, enterprise. But in some ways, it almost reminds me of NVIDIA because NVIDIA has been growing into its valuation. And in some ways, analysts are having a hard time wrapping their arms around how quickly it's growing into its valuation. At least that's been the case over the last few years.

Palantir seems to be a very similar dynamic, at least right now. I mean, look, you're back to 30% year-over-year revenue growth. You just said that. I think that was a golden number for the market. And I think your, you know, NVIDIA, like you said, is actually getting cheaper on a forward multiple basis as it goes up. It's honestly cheaper now than it was three years ago on a forward multiple basis, which is incredible. That's just how quickly that company is growing. Now you have Palantir, which is kind of taking the AI trend, but not looking at it from the hardware perspective and

the chip perspective, but how can you implement that into companies and governments and everything that were used day to day? I think this is the first company that's really able to do that successfully and command the premium that we're seeing in that stock. And based on the market's reaction, I think it can keep going higher here. All right. Adam Kobasi from the Kobasi Letter and Paul Hickey from Bespoke Investment Group. Thank you. Well, hims and hers earnings are now out. Brandon Gomez has those numbers. Brandon. Hey, John. Yeah, a beat on the top and bottom line. Really a staggering beat here. EPS coming in well above expectation, 32 cents versus 4 cents, which is what was expected. The street high was calling for 10 cents.

So, again, a staggering beat there. Revenues also coming in ahead of estimates. And then Q4 guidance also coming in ahead. Look, I pulled a quote from the CFO in the press release really highlighting the fact that this growth is beyond what we're seeing just in the GLP-1 weight loss drugs, right? Because there's been so much focus there. He says subscriber growth, excluding contributions from our compounded GLP-1 solutions, increased 40% year over year benefits from improving brand awareness. And he goes on to say personalization initiatives.

So obviously, you know, a story here that goes beyond just the GLP-1 weight loss impact, but one that will continue to follow. Shares up now 2%. We're up as much as 9 percent earlier in the trade. All right. Brendan Gomez, thank you. As you're talking, those shares reversing and moving to a 1 percent gain. We've got Cleveland Cliffs earnings out as well. Pippa Stevens has those for us. Pippa. Hey, Morgan. Well, the stock is in the red here. Revenue coming in at 4.57 billion. That was short of the 4.77 billion that analysts were looking for. The company also reported a $0.52 loss that includes several items.

Now, it is unclear if the number is comparable to the $0.27 loss that analysts were looking for. Adjusted EBITDA was $124 million, while analysts polled by LSEG were looking for $174 million. The company said that weaker demand and pricing drove tighter margins, leading the company to temporarily idle one of its blast furnaces, adding that its high exposure to automotive meant it's been more affected than its competitors. Cliffs did say that it expects demand to rebound in 2025, supported by economic and political factors. The stock now down four and a half percent.

Morgan. All right. And of course, they did just close that Stelco acquisition as well. Pippa Stevens, thank you. Let's turn now to Mike Santoli. He's here at CNBC headquarters and he has a technical look at stocks at this monumental week of market moving news gets underway. Mike. Yes, Morgan, let's start actually with the bond market. You were just talking about this as many rally in treasuries. Take a look at a two year chart of the 10 year treasury yield. Wanted to highlight it from the ultimate highs back in 2022. Look at that. That's pretty much obeying barely this sort of downtrend line that's been in place for a while. So if it blasted ahead of this, you'd have more people saying, oh, no, we have a breakout in yield. So it's it's at this point remaining contained in this range. Pull back where it

sort of had to. You found some buyers with that soft jobs report on Friday. Take a look at the Dow Jones Industrial Average and its 50 day moving average. It's kind of pulled back into this somewhat neutral spot here along its intermediate term trend line. In fact, the S&P 500, the Equal Weight S&P also all pretty much retreating to that 50 day. So the uptrend is intact, but there has been a little bit of backing away as we head into these sort of highly consequential events over the next couple of days. Finally, I want to take a look at a long term relationship between the Dow Jones Industrial Average and the S&P 500. So this is the Dow divided by the S&P, essentially. And you see we were recently down at historic depths of underperformance of the Dow versus the S&P.

You go back to the 1999 right there. That's when the Dow first put in Intel and Microsoft, November of that year. It was the first NASDAQ stocks to go in. It was seen as the Dow trying to sort of chase relevance from the booming tech stocks. That was four months before the bubble peaked, by the way. And you see the Dow outperforms when the overall market is weak in bear markets. And you see here, as we get NVIDIA added as well as Sherwin-Williams, a little bit of an attempt to freshen up and enliven the Dow because of that underperformance versus the S&P and, of course, the NASDAQ. Of course, that's where I'm going to hone in on this conversation with you, Mike, because Sherwin-Williams had a pop 4.5% today based on that news.

NVIDIA finished up fractionally higher, too. But I just think back to GE. I think back to Honeywell and some of these other names when they got the boot from the Dow. In hindsight, that ended up being somewhat of the trough for some of those names that had faced challenges. And I wonder whether it signals something similar potentially for Intel. Yes, it definitely could. The history says there are times when the ejection from the Dow is essentially a capitulation sign and maybe that it's gotten washed out. And if the company itself has got a, you know, a decent future, then, yes, it can be a buy signal. I guess I'll say don't rely on that 100%. I go

back to when I first started covering the markets and Westinghouse and Woolworth were in the Dow. So you don't want to buy either one of those once they got booted out. But in general, there's a little bit of a contrarian pattern to those that get included and excluded. Even more recently, 2020, Salesforce goes in, Exxon goes out. Exxon massively outperformed the market over that time, and Salesforce has done very little. All right. You forgot about Montgomery Ward, Mike Santoli. Thank you. Wow. NXP Semiconductor, earnings are out. That stock is heading lower. Sima Modi has the number. Sima. And John, the story is that third quarter revenue came in line with expectations, and earnings were a a two cent beat, $3.45.

But its guidance is disappointing here. $3.1 billion at the midpoint versus a 3.36 estimate. It sees its fourth quarter adjusted EPS into $3.13 range, which is well below what Wall Street was expecting. Auto revenues, interestingly enough, are in line, and that is one thing that investors were a little bit worried about given the messaging from some of the other automakers and semiconductors that service the auto industry. This is also where NXP makes about 56% of its revenue. Guidance, some comments here from its CEO, Kurt Sievers, who says guidance for the fourth quarter reflects broader macro weakness, especially in Europe and the Americas. Morgan and John, when the earnings

call starts, will look for the commentary on China. That has actually been a bright spot for a lot of these semiconductors. Back to you. All right. Seema Modi, thank you. We're just getting started on overtime. Up next, much more on today's earnings action. Analyst Brent Thill joins us with his first take on Palantir's big after-hours jump. That's currently trading at record levels, if this pop holds. Wow, 13.5%. Well, real estate developer Howard Hughes Holdings just out with third quarter results as well, reporting revenue of $327 million, up 43% year over year, earnings per share of $1.95.

We're not comparing estimates because of thin coverage. The company CEO is going to join us later in the show to talk about the quarter, how the election and this week's Fed decision could sway the real estate market. Overtime, we'll be right back. Welcome back to Overtime. Real estate development and management firm Howard Hughes Holdings reporting earnings a few moments ago. Shares are climbing up more than 4% in overtime. Joining now in an exclusive interview before the earnings call is Howard Hughes CEO David O'Reilly. David, great to have you. So last quarter, you said rents for you were stable in a tough environment, up 1%. How do they look now? Even better. I can tell you that our business has never performed better than what we saw in the third quarter here across all of our business lines.

Going to rent in our recurring NOI, we were up 8% year over year. Led by office and multifamily, which has been two areas that have been largely under scrutiny from the national media and from research analysts. We've never sold more land in the history of the company than we did this past quarter to home builders. As single family housing demand continues to remain strong. And just over my shoulder here in Ward Village on Oahu, we're closing on Victoria Place, realizing $760 million of revenue at a 27 to 28 percent margin this month. So that is really an interesting standout in this market. How much of that is because it's Hawaii, because it's a tower, because it's brand new, and the luxury consumer in that narrow segment

is one that continues to have money to spend? Well, over the past 10 years, we've sold over $6 billion of condos right here at Ward Village. And we've launched our first condo tower in the woodlands just north of Houston. And we've seen remarkable success there. We have units here that are focused on workforce housing, which are those that are first-time buyers and make no more than 125% of the median income. And those are entirely sold out. We have third-row towers, second-row, and first-row. So it's not just a luxury buyer. There's a massive housing shortfall, not just here in Hawaii, but across our entire country.

And we're selling that land to home builders or building the condominiums to meet that demand. So, David, what do you make of the fact that Treasury yields and with them mortgage rates have place and where you can finance today creates that lock-in effect, which has put more and more pressure on meeting that housing demand with new construction. And because we hold the precious resource that homebuilders need to meet that new construction, we've seen an increase in price per acre across our portfolio. And like I said, we had a record number of acres sold to home builders this quarter as they need that raw material to meet that increased demand. Resale supply is not coming on the market. So it's going to have to be accomplished through new construction. So Bill Ackman's Pershing Square owns a big chunk of your company. They put out a regulatory filing disclosing that they're exploring taking the company private. Your response? Oh, I can't comment on what Bill Ackman is thinking. He was the former chairman of the company, was an incredible constructive chairman,

helping to guide the strategic vision of this company for its entire existence. But what he's thinking and what his next steps are, you'd have to ask Bill. OK, David O'Reilly, thanks for joining us. Happy to do it. Aloha. Definitely the best live shot of the day. Little jealous. All right. We have a news alert on Dollar Tree. Steve Kovac has the details. Hey, Morgan, less good of a live shot for me, but we do have a leadership transition here going on at Dollar Tree. The CEO, Rick Dreiling, has stepped down. That was effective as of yesterday, November 3rd. He is citing in this health reasons for stepping down. In the meantime, COO Michael Creeden is going to be replacing him in an interim basis as CEO, and they are going to be looking for a new permanent CEO. Based on that, they are also reaffirming their third quarter

outlook here ahead of earnings. We see shares are up about 5 percent, guys. All right, Steve, thank you. It's time now for a CNBC News update with Bertha Coombs. Bertha. Hey, Rory Morgan. The U.S. cybersecurity chief, Jen Easterly, said today that the 2024 election cycle has seen unprecedented levels of disinformation from foreign adversaries. But the surge has not impacted the election. The U.S. intelligence community has warned that Russia and other adversaries are part of a broader effort to undermine election integrity. A Japanese nuclear reactor that restarted last week for the first time in 13 years after the Fukushima disaster has shut down again. The plant operator said the reactor shut down on Sunday due to a glitch with the equipment.

The utility said there were no concerns of a radiation release into the environment, but did not give a new date for a restart. And San Antonio Spurs head coach Greg Popovich will be out indefinitely after suffering what they say was a health issue over the weekend. According to multiple reports, assistant coach Mitch Johnson will fill in for the time being. The team has not shared what the health issue is for Popovich, who is in his 29th season as the Spurs head coach. We wish him good health. Back over to you, John. Bertha, thank you. Coming up, venture capitalist Bradley Tusk on VC's rising role in American politics and how the outcome of the election could impact everything from tech policy to crypto.

We'll be right back. Welcome back to Overtime. With more than 70% of S&P 500 companies having reported earnings already, Mike Santoli returns with a look at how this season compares to recent quarters. Mike. Yeah, John. Well, look, the thing about U.S., big U.S. companies anyway, is the majority of them always exceeds earnings expectations. As this blue line shows right here,

it's rare that you don't have a majority exceeding the published forecast of the consensus. But it's a matter of what the degree of that beat is. So you see it's actually kind of pulled back from recent quarters. Roughly 70 percent coming into today of S&P 500 companies have beat on the bottom line. Top line, as you can see, the beat rate has actually eroded a little bit. So while it's not been a bad in aggregate earnings season, it's probably a little bit less than we might have hoped for, considering that estimates did come down over the course of the quarter. This can turn, of course, with the remainder of the companies yet to report. But it does show you that there's been a little bit less incremental reason to get excited about the fundamental picture,

even if in general things are tacking in the right direction. I guess overall, the trend doesn't look that bad, although we're looking over a 20 year phase here. But over that last bit of time, you're right. It's generally heading up on the EPS side, at least, though not on sales. It's heading up, although in the latest quarter you had that reset lower. So I think that's what we've been struggling with. And obviously, the market's hung in there. We're not too far from highs, but you have had a little bit of a pullback as the earnings season has matured. All right. Mike Santoli, thank you. Well, up next, venture capitalist Bradley Tusk and how his industry could be impacted by the outcome of tomorrow's presidential election.

And why more VCs have been getting involved in elections in general this cycle. Welcome back. The presidential election is tomorrow. Both candidates getting massive support from Silicon Valley as the tech industry weighs what is at stake. Well, joining us now is Bradley Tusk, co-founder of Tusk Venture Partners. He's also the author of the book Vote With Your Phone, in which he makes the case for mobile voting. He's also he's also said he is endorsing Vice President Harris. Bradley, it's great to have you on. And before I start getting into election outcomes and policy implications, I do want to just take a step back and ask a really basic question about the fact that it does seem like venture capitalists have been much more open, public, big money raisers this election cycle,

more so than we've seen in the past, whether that is, in fact, the case. And if so, what it signals about what is, in fact, at stake for this election. It's probably representative of two things. The first is part of it is just some really high profile people have gotten involved. And obviously the most important one there is Elon Musk. While he's a founder and not a VC, he's connected to the ecosystem in every way. And so everything he does gets a lot of attention. But the other thing is, I think, you know, VCs are realizing that politics matter, regulation

matters. And, you know, who's in charge and the issues that they care about has a big impact on the future of their portfolio companies. And if you want those companies to be treated fairly, you need a seat at the table. And that comes from getting involved. So let's let's do play this game about election outcomes and what that's going to mean for policy implications, because, yes, there's some differences between these two candidates, but there's also potentially some similarities. And so I wonder what that means from an antitrust standpoint for tech companies when you have a current administration

in which Harris is a part of that's been very aggressive about that. But some of those same suits actually started under the last administration with Trump. So what that looks like, what it also means when you're talking about two candidates that are arguably both going to be hawkish on Canada and I mean, China, excuse me, in this disentangling, very different country. Trump will be hawkish on Canada. Yeah, yeah. Disentangling of tech supply chains, et cetera. Yeah.

Well, look, I think on antitrust, maybe it helps to sort of split it up into two different categories. So the first category is specifically going after big tech. So Google, Amazon, Apple, Meta, those companies. And I think that there is a lot of support on both sides of the aisle for doing that. And we've seen J.D. Vance say that he actually supports what Lena Khan is doing there. Then the other group, and this is where I think Republicans and a lot of Democrats also really have a problem, is the general FTC antithesis towards mergers and acquisitions overall. And the reason why that's a problem is it has had a chilling effect kind of across the ecosystem.

And so as a result, you're seeing less companies get funded, less new company formation. All that means less innovation. And so if companies think that an acquisition is going to get blocked by the FTC and that there's no way it'll happen, then there's just less M&A activity. And most tech exits, as much as we love IPOs, are not IPOs, they're M&A. And so I think that it is important that at the very least the tenor of the FTC change around that.

I think it's pretty likely that it would under Trump. It probably would under Harris, too. I think that she has certainly, as you just showed, gotten support from a bunch of prominent VCs who will have influence with her. And so, you know, I think that we're probably in for better treatment either way. Bradley, when I was coming up in Silicon Valley reporting about 25 years ago, the ecosystem, tech, chips, telecom used to stay out of politics because of, I think, the history as a government contractor and big government research area. It seems to me that that has just sort of shifted, perhaps forever, because you've got elements on either side of the political aisle now in tech trying to counterbalance each other. Where do you think we go from here? Yeah, it's a great question. So the first thing is, look, just the whole world has gotten more

political in the last 25 years. And the advent of social media has sort of made it impossible for lots of people to stay out of politics who used to be able to avoid it. You guys have, obviously, conversations all the time on CNBC about, you know, how corporations should deal with different social and political issues. So this has become the new norm. And yeah, I think that ultimately the role of Silicon Valley has gone from a government-funded kind of research institution into the premier driver of technology and innovation for the entire globe. And as a result, not wanting to upset someone in government is no longer the absolute priority. And people realize

that who gets appointed has a big impact, right? So if we take crypto, the Biden administration has been very, very anti-crypto, and that has had a really big impact on the sector and on the industry. And so it makes sense that that sector has sort of gotten really involved, has put a lot of pressure on both candidates and on legislative candidates as well. And I think that that's the world that we live in. And I think once, you know, once the genie's out of the bottle, it doesn't go back in. All right. Well, Bradley, hold tight because the news is cooperating with our conversation. We've got breaking news on Elon Musk. Steve Kovach has the details. Steve. Hey there, John. Yeah. Elon Musk's million dollar giveaway out in Pennsylvania. This is between him and his America PAC to voters. That can continue now.

The judge in Philadelphia, this is from our colleague Gary Grumbach over at NBC News, has denied the Philly district attorney's motion to stop this giveaway. Obviously, we're 24 hours away from Election Day, so it might not have mattered too much. The lawyers for Musk and his PAC spent much of the day arguing over whether or not the giveaway was, in fact, a random lottery versus giving people payments as supporters. They went back and forth for many hours, and the judge just now deciding this million-dollar giveaway can continue in Pennsylvania. And, again, we're a day out from the election. So this is a loss here for the Philly DA, John. All right. Steve Kovach, thanks. Bradley, this is Silicon Valley money going directly into the election process. Yeah. Look, I think that ultimately I and Musk and I have

different views as to who should win this election. But ultimately, you want more people to vote. And we have incredibly low voter turnout in this country, especially in all elections that are not the presidential. And we've got to come up with different ways to get people more engaged. And so, you know, if that's how Elon wants to do it, honestly, if it is legal, I think it's not necessarily a bad thing. Just like I'm trying to make it possible for people to vote on their phones in elections. I think that would help increase participation quite a bit. And so I don't really have a problem with it. And keep in mind, just for the viewers who are probably not that familiar

with the DA of Philadelphia specifically, he is as far left as it gets. So if you are sort of a regular Democrat kind of watching this and thinking, well, you know, the Democratic DA is probably by politics, odds are if you're watching this show, he is not. All right, Bradley Tusk, great to have you on. Thanks for joining us.

Yeah, thanks for having me, guys. All right. Tomorrow will be interesting. It will be. Speaking of, we're going to hear from the other side of the VC political spectrum tomorrow. And we are joined by Kozlo Ventures Managing Director Keith Raboy, who's supporting Donald Trump in this race for the White House. Well, up next, all of the overtime earnings movers that need to be on your radar as Palantir gets set to kick off its analyst call at the top of the hour. Welcome back to Overtime. We are in the final countdown ahead of the election. Joining us to discuss the impact of the outcome on your portfolio is Raymond James, Washington policy analyst and managing director, Ed Mills. Ed, good to see you back here. So this time, for the first time that I can

remember in quite this way, we've got the polls, which seem to be very, very close within the margin of error across so many battlegrounds, and then betting markets and the equity markets, which seem to be more certain of what's going to happen. Have we seen something like this before? Not really. I do think when I was in Boston, New York last week meeting with clients, it seemed like everyone was certain that Donald Trump was going to win this. Then we had some polls come out over the weekend and the vibes have shifted again. I've looked at these betting markets for years. They oftentimes amplify kind of the vibe that's out there. They don't generally

are very predictive until we start getting votes. There were some races back in 2020 that had a 1% chance for certain candidates that ended up in the Senate, ended up in the House. So I don't over-index to those betting markets. I look at a much larger mosaic, John. We can only imagine what the betting markets would have been saying in 2016. So what's likely most volatile if we get a result that is somewhat different from what the markets are expecting? Yeah. So what we did at Raymond James is we've gone sector by sector, giving our top picks. And over the weekend, what we asked ourselves is, if there was an unexpected result, where could investors be caught offside? So if you're betting on a Trump victory and Harris wins, semiconductors, health care facilities, REITs were what screened as being potentially

most offside. If you're betting on a Harris victory and Trump wins, construction, engineering, ground transportation stocks are the ones that are most offsized when we look at performance from the election day through the first six months of next year versus where the market's been trading over the last six months. Are there any sectors that are bipartisan? And what I mean by that is that it really doesn't matter what the outcome is. They're going to continue on a secular journey. Yeah, Morgan, that was another thing that I wanted to do here at Raymond James is because things are so close and there are so many variables, you can go down rabbit holes real quick. So I put out a report that said, here are some of the things that are going to happen regardless of the outcome of the election. And a lot of them are market positives. So I think no

matter who wins because of changes from the Supreme Court, there's going to be less regulations four years from now, eight years from now than there is today that benefits energy, health care, financials, telecom. I do think we're going to get energy permitting reform because that's very bipartisan and we have AI needs for that energy. That's going to benefit all of the things that get those tax credits under the Inflation Reduction Act. And finally, no matter who wins, there's still a lot of fiscal stimulus that needs to be digested to the economy. We estimate that actually only about 25 percent of the fiscal stimulus passed under the Biden administration has been spent. So there's almost a trillion of dollars that are still going to be digested into this economy over the next couple of years. That boosts industrial stocks. That boosts anything

tied to energy as well. We talk about the race for president, but how much does the composition of Congress matter here? I mean, I think about I cover defense, right? Defense spending. That's going to largely lie with Congress, not the president. Yeah. So one of the things we said is that no matter what happens, we're still unfortunately in a very heightened geopolitical risk world. And so defense budgets go up regardless. But you mentioned Congress, and this is really important because when I go down the list of things that are potentially market negative, when you don't have a Democratic sweep, if Harris wins, if there happens to be a Republican Senate, that takes off the table some of the potential tax increases.

It also takes off the table the trade tariff immigration policies that Donald Trump is pursuing. Is that ultimately one of the better outcomes for the market? Now if Donald Trump wins and there's a Democratic House, I think there's a little bit more warning there than the market is saying, because I don't think those Democrats are going to want to give them a victory. And that might be the one scenario where we don't get a tax bill next year. All right. Ed Mills, thanks for gaming it out for us. We appreciate it. Thank you.

Of course, tomorrow, we're going to get more earnings on top of election here in overtime. I'm keeping my eye on Supermicro, which we know has already had some massive moves, given some of its accounting issues. Well, in the chips today, Cirrus down 9, Lattice down 8.8, NXP down 5.5. It's a lot. Yeah. Well, that's going to do it for us here at Overtime. Fast Money starts now.