Closing Bell - Closing Bell Overtime: Stocks Surge To Records After Trump Victory; Palmer Luckey On New Defense Tech 11/06/24

Episode Date: November 6, 2024

The Dow, S&P 500 and Nasdaq all closed at record highs as stocks surged the day after Donald Trump's presidential victory. We break down what the next steps are going to be across the key sectors and for your money. Interactive Brokers' founder Thomas Peterffy talks about investors hoping for less regulation on Wall Street, while longtime tech investor Alan Patricof gives his take on what happens now for Big Tech and M&A. Plus, Anduril founder Palmer Luckey on the growing relationship between Silicon Valley and the Defense Department.

That's the end of regulation. Boston Scientific bringing the closing bell at the New York Stock Exchange. CVB Financial Corp doing the honors at the Nasdaq. Animal Spirits reawakening. Record closes for the Dow. S&P 500, Nasdaq. Also the Dow Transports. We've got a record high for Bitcoin. Investors jockeying for position after Donald Trump's presidential victory. That is the scorecard on Wall Street. But the action's just getting started. Welcome to Closing Bell Overtime. I'm Morgan Brennan. John Ford is off today. We are awaiting breaking news this hour. As Vice President Kamala Harris is expected to speak

any moment at Howard University, we will bring you those remarks when they start. And we have got a big lineup to talk about how a second Trump administration will impact your money, including Thomas Petterfy from Interactive Brokers, Andrel Industries founder Palmer Luckey, and Greycroft co-founder Alan Patricoff. Plus, a wave of earnings is on the way, including Qualcomm, Arm, Wolfspeed, Lyft, TripAdvisor, and many, many more. But let's get right to this record-setting rally. Joining me now is Fundstrat Global Advisors head of research and a CNBC contributor, Tom Lee. Tom, it's great to have you

on. Fifteen hundred points for the Dow today. We haven't seen a move like that in a couple of years. Where do we go from here? Wow. Well, I think Morgan today is really an example to show you that the market did not price in an election outcome. If it did, we'd be trading flat. I think it's real evidence that many investors, and this is something we could tell talking to our clients, de-risked ahead of an election because they thought there'd be a lot of social unrest, et cetera. And so I think money's being put to work, but in a way that reflects there's quite a lot of animal spirits in the sectors people are choosing. The small cap, I should note, we have Qualcomm earnings out. We're going through those results.

We'll bring them to you in just a moment. Mike Santoli is also with us now. So, Mike, I'm going to go to you on this one, And that is the fact that we have seen this Trump trade in play today, whether it's the strengthening of the dollar against other currencies, it's the rip we've seen broadly in equities, especially those from steelmakers to banks to anything that's considered more cyclical and economically prone to stronger growth and deregulation, Bitcoin higher as well. But we've also seen some some sell offs within this market under the hood, too. There had been a lot of speculation on whether the so-called Trump trade, as it was being defined coming into today, was going to actually pan out and play out.

Your thoughts? Well, it certainly is playing out and it makes sense that it is, at least as an initial push. And I think on most of those fronts, it's been mostly just an additional kind of push behind some of the trends that have been stirring under the surface. Again, we've had cyclical leadership for a little while right now. The dollar has been relatively firm. Yields have been going up since the Fed cut rates and economic surprises have been positive. Now it's just about kind of applying a little bit of that 2016 playbook and maybe sharpening it a bit when it comes to things like small caps moving, obviously banks just piling on the gains. I do think there's going to be a question as to the starting point. The starting point right now is not quite the same as it was in 2016 in terms of valuation,

in terms of inflation, in terms of deficits, in terms of deficits, in terms of recent growth rates in the economy, and also arguably even in terms of investor posture. The market had been flat for 18 months before the 2016 election, and we're up 40 percent in the last 18 months here. I don't think animal spirits have been asleep. They've just been essentially energized that much more with this potential policy mix. Okay, we've got Qualcomm earnings ready to bring you. Seema Modi has the numbers. Seema. Morgan, a solid beat from Qualcomm on earnings and sales,

plus news of a $15 billion buyback on earnings, $2.69 adjusted versus the $2.56 estimate. Guidance for the first quarter, a little light on sales, but EPS was mostly above the street. Qualcomm does say it's making inroads in the automotive market. Two big wins. Manufacturers Lee Auto and Mercedes-Benz are adopting its Snapdragon Elite. We'll see shares surging here in overtime, Morgan, up over 10%. All right, Seema Modi, thank you. Tom, I want to go back to you. Yes, we just got Qualcomm results. We know semis have been a pretty strong trade all year long, as has big tech. Does that continue here or do you continue to see a rotation into other parts of the market like small caps, which just had their best day in three years? I think it depends on investors' timeframes. I think many people who are buying tech and AI for the long term shouldn't be concerned with them into year end. But I think there's going to be much better opportunities in small caps or regional banks or financials because it's kind of the backdrop Michael talked about that, you know, they've languished for multiple years. So there's an opportunity for them to catch up. I think another risk is that

many of the technology companies might be viewed as somewhat hostile from a new White House perspective. So I think with the exception of a few names like Tesla or Twitter or X, really, many of these may come under scrutiny. And I should note the Russell 2000 hitting its highest level in three years. Mike, what is the bond market telling us here, especially as we do see this bearish steepening of the yield curve? Yeah, it's always, you know, kind of multiple causes. Usually whenever you see this type of a move, clearly there's an expectation that we will have sustained perhaps rapid growth or at least able to kind of keep this growth pace up in real terms. Then there's a little bit of a bump to market-based inflation expectations in there. I'm not really sure there's a lot of a fiscal influence just yet.

I'm a little bit skeptical of that making its way in real time necessarily into the long end of the bond market. But there are those who believe that is, in fact, the case. But I don't think there's enough clarity on that. I think the significant part is, you know, the stock market and the economy can make their peace with yields at this level. With the steepening of the yield curve, Fed probably going to trim a little bit more and a sort of decent setup in terms of absolute level of yields if the economy hangs in there and earnings are growing. And, Tom, we might not be seeing impacts from fiscal yet. Certainly there's a lot of debate and discussion around how all that will materialize in 2025 and beyond. But we do have a Fed meeting tomorrow.

We actually have four central banks with decisions tomorrow. So globally, largely, we are seeing this easing cycle kick into a higher gear here. How much does that matter? How much does the fact that you have the overhang of the election clearing out here matter? And also just good old-fashioned seasonality. All of them actually matter. You know, the VIX market is telling us that all these concerns have really come out of pricing because, you know, the VIX is down big. The Fed meeting tomorrow, I think, is really important because, I mean, I have a lot of our clients asking us about yields, and I think the Fed isn't going to be

comfortable with the long end rising. That's a tightening of financial conditions, basically offsetting rate cuts. So I think the Fed is dovish, and I think they'd like to see yields behave, and they'd like to maybe even try to talk those down. So I think overall, it's going to be a good way to finish the week. I think it's actually a positive tailwind. Okay. Tom Lee, thank you. Oh, never mind. I take it back. We're going to keep this conversation going. So Tom, in light of this broader conversation, the fact that you have been bullish across different parts of the equity market all year, it does seem like S&P 500, 6,000 is very much in sight. Is it time to revise your estimates, especially as you look to next year?

Yes, Morgan, it's November 6th. We still have eight weeks left and 6,000 is, you know, like less than 100 points away. That number is clearly too low. I think the seasonality tells us the upside is somewhere between 5% and as much as 10% into year-end. But if the S&P moves 10%, I think the Russell 2000, as you're pointing out, IWM making a three-year high, that could move way more than 10%, 30%, 40%, because the median PE in the Russell is 10.7 times board earnings. So I think there's a lot of opportunities if the S&P adds 5% into year end. Okay. We've got more earnings. Lyft results are out. Deirdre Bosa has the numbers. Hi, Dee. Hey, a very enthusiastic response from Lyft. Investor shares are up nearly 25%.

In terms of revenue, it was a beat here, $1.52 billion versus $1.44 billion expected. That is revenue growth of 32% year over year. Reporting a gap loss per share of $0.03. We're not going to compare that to estimates since we did not get an adjusted EPS, but it is largely the guidance that is powering shares higher. Third and fourth quarter guidance, largely positive, above expectations. Only bit of softness is in Q4 gross bookings. But investors are focusing on that adjusted EBITDA guidance for both quarters. Much better than what the street was expecting.

I did get the chance to talk to CEO David Risher. I asked him about that recently announced DoorDash partnership. He said that there's overlap between the customer sets, but it's smaller than people think. And it's going to drive bookings over time. It's going to drive ride frequency. And he's already seeing the quick adoption of linked accounts. He attributes the higher guidance to just better demand and being able to fulfill it, the supply side of that equation. I also asked him if anything changed with the incoming second Trump administration. He said that they've worked with administrations of all different types over the years, noting that the gig economy is now a significant part of the larger economy. Morgan. All right. Dear Jabosa, thank you. Shares of Lyft are up more than 23 percent right now.

Lyft CEO will break down those results tomorrow at 840 a.m. Eastern on Squawk Box. Arm earnings are out and Seema Modi has those numbers. Seema. Morgan, a strong beat from Arm Holdings, 4 cents above consensus on its bottom line, while sales also came ahead, $844 million versus the $808 million estimate. The company says it's seeing record levels of royalty revenue and continued strength in licensing sales. Remember, ARM does license its chip designs to a number of semiconductors. It's also sharing a positive update on its partnership with Meta on Lama 3.2, which uses ARM's CPUs. We're looking at shares down about 3%. I would point out its third quarter guidance did come in line with expectations,

and the bar was pretty high going into this report. Seema, thank you. Don't miss the First on CNBC interview with Arm's CEO tomorrow at 10 a.m. Eastern on Squawk on the Street. Mike, going to get your response to these results, especially given the fact that for Lyft in particular, big move. Yeah, this is not the kind of market where, you know, the neglected and hated stocks are going to react in a mild way when you get any kind of an upside surprise. So I would interpret it that way. Just the upside in terms of ridership and revenue is just enough.

And it's a very twitchy market for anybody who is short or underinvested. And that'd be my take on the immediate response there. All right. Tom, I want to get your final thoughts here, especially as we did see this monster move in equities. And just how much of this is potentially pull forward. Just how much more room there is to run here, what you'll be incredibly strong stock market, you know, rising eight out of 10 months. It's really maybe one of the it'll end up being one of the 10 best years ever in the history of the market.

But that means investors shouldn't be skeptical. I mean, there are now fundamental tailwinds coming into play with animal spirits and the Fed dovish. So I think people should just sort of be ready to buy the dips and stay invested. And Mike, as we do go through earnings here and that continues, how much does that now contribute to or continue to contribute to the narrative versus some of these more macro pieces of the discussion? Yeah, I think in general, it's still supportive. I mean, we're most of the way through the market capital, at least of the S&P 500. Most of it is kind of fallen in line with the longer term expectation of a return and broadening of earnings growth. But I do think that there's

going to be maybe a more forgiving nature for some companies or at least for the market as a whole. Initially, as investors feel like they want to kind of grab hold of the potential macro tailwinds that Tom's talking about. I don't think it's necessarily all clear sailing. But this phase of it where kind of hope comes first and then reality might intrude. I'm going to be mindful of whether investor and trader sentiment gets a little bit overexcited in the short term. I don't think that's necessarily an imminent threat, but that's the kind of thing you would look at as we get toward year end and people maybe continue to chase and get their growth expectations to be a little bit elevated. We've got more earnings. Take two results are out and Steve Kovac has those numbers. Steve.

Yeah, Morgan, and shares are down a bit here on these results. Let me read them off to you. Revenues were a slight beat at one point four seven billion dollars. Adjusted Street was looking for one point four three billion dollars. As for EPS, this is a loss of two oh two per share. That's a gap loss. We are not comparable to estimates. Guidance a little light here for Q3, just barely under estimates. But they are also reiterating the launch date or launch window, rather, for that new Grand Theft Auto game in fall of next year. We see shares here down nearly 4%,

Morgan. Okay. Steve Kovach, thank you. Mike, I'm going to go back to you. I'm going to ask you a question that you're probably going to roll your eyes at me for, but Dow theory. And I know we can poo-poo it and say that, you know, this is old and it's outdated, et cetera. But the fact that you do have the Dow transports closing at a record high, how much of a positive signal from a technical standpoint is that? It's absolutely positive when you have more stocks and more cyclical stocks going up along with the broader market. I see it a little more as a removal of a negative or the avoidance of a negative, because usually what you don't want to see is one making a new high and then the transports lagging behind and not confirming it. Although, by the way, I think conventional Dow theory would also want the utilities to be joining

as well. They're not supposed to move contra. So we'll see if that has a little bit of a stutter step in that trend, given where rates are gone. Well, we've got Elf Beauty earnings out and Courtney Reagan has those numbers for us. Hi, Court. Hi, Morgan. Yet another strong quarter for Elf Beauty, beating the street estimates by quite a large margin, coming in with earnings of 77 cents. The street was just expecting 43. Revenue is also beating 301 million dollars compared to 286 million estimated. Then they are also upping their full year forecast for 2025 for both revenue and earnings. So the revenue guidance is now above the street.

The EPS, however, is about the midpoint is slightly below where the street is guiding. And I would note that they had a pretty big beat here on this quarter, as I noted. But the guidance for EPS is not being pushed up as high, which is somewhat interesting. Still, shares reacting positively up 12%. They were up as high as 20% just a couple moments ago, and the CEO notes a 23rd straight quarter of sales and market share gains there for Elf Beauty. Back over to you. All right, Courtney Reagan, thank you.

We've got Wolfspeed earnings out. Seema Modi. Morgan, not a great picture here from Wolfspeed. First quarter results, a smaller than expected adjusted loss on its bottom line. However, revenues did come in below street expectations. And its second quarter outlook, Morgan, downbeat, worse than expected. It's reducing its CapEx guidance. And some comments here as we pour through the earnings report about driving operational improvements,

taking action to enhance efficiency, align the business with current market conditions. One of the issues this company has faced is just higher expenses related to silicon carbide, a key component that goes into the semiconductor sector. And as you may remember, this is a company that just won a grant from the U.S. CHIPS Act or is on tap to receive that money. So we'll see how this specific financial performance could impact that disbursement of funds. And of course, the election, too, a big part of it. Let's look at shares. We are down 13 percent in overtime. More to come. All right, Seema, thank you. Tom Lee, I'm going to go back to you because we saw gold take a bit of a breather today. But Bitcoin had a big surge, jumped 10 percent at record highs,

broke through technical levels we saw earlier in the year. Your thoughts? I think I think Bitcoin is moving up for the right reasons. President Trump was running on a platform that was not only pro Bitcoin, but really the notion of Bitcoin potentially becoming a U.S. Treasury Treasury Reserve asset and a U.S. Treasury Reserve asset, and the U.S. potentially becoming the largest holder of Bitcoin over Satoshi. So I think that if someone was constructive on the idea that digital money is secure and it got validated because financial institutions like BlackRock support it, now we might have the U.S. government actually own it as a reserve asset. So I think it's very bullish for Bitcoin. And some of the proxies like MicroStrategy are

similar or the Bitcoin miners. So I don't think it's too late to own it here. OK, Tom Lee, thank you for joining us. Mike Santoli, thank you. We'll see a little bit later in the show with the Dow surging 1500 points, the S&P up 2.5 percent, and the Nasdaq finishing up almost 3 percent today. Well, the defense sector getting a big boost following the election results as well. And defense tech, AI, Silicon Valley, these are growing more important for the government's innovation in national security and on the battlefield. So what will that dynamic look like under a second Trump administration? Well, joining me for a first on CNBC interview is Andrew co-founder Palmer Luckey. He supported Donald Trump in the election. And Palmer,

it's always great to have you on. Welcome. Hey, you know, I did not just in this election. I supported him last time around and I supported him in 2016. And I don't know if you know this. I actually wrote a letter to Donald Trump in 2011 telling him that he should run for president. So I've been on the tech for Trump train for longer than just about anyone. And I've been punished for it. I've been fired for it. And to finally win, it's kind of nice. I haven't won so much. I'm tired of winning, but I'm getting there. Great. So if a Trump administration approached you to work within the administration then, would you? Look, I think that I'm doing some pretty good stuff inside of Anduril. I started Anduril because I wanted to help transform U.S. national security,

save taxpayers hundreds of billions of dollars by making tens of billions of dollars. I think that that's probably where I would need to be now. If someone calls me up and says there's this incredible role where you can make an incredible impact, I'd probably have to answer the call. I've got a lot of my ego wrapped up in believing that what I'm doing is the best thing I could be doing for my country. So someone would have to convince me that it's the best thing I could be doing. I think that's going to be hard given how things are going in Anderle. But I'm actually feeling good even without me in the administration. I think Trump is a change candidate. He very much wants to balance the budget. He wants to save

money. He wants to get more for less. I think it's pretty interesting. You saw Trump last time around get personally involved with the negotiation of major DOD contracts, including with things like Air Force One. I think he that's something you haven't really seen with presidents in a long time, direct involvement in trying to get more for less out of our defense budget. I think that's great. And I actually also think that President Trump is not going to politicize the defense procurement apparatus, which I really appreciate. Contrast that with, I think you saw senior Democrats saying we need to take away contracts from people on the basis of their political views because people are injecting themselves into the democratic process. Anderle is a nonpartisan company. I'm a Republican. I'm the founder. Our CEO, Brian Chimp, though, he's a Democrat. He fundraised for Kamala. He hosted fundraisers for other Democrats this cycle as well. But the idea that we need to be

the strongest military in the world is really nonpartisan. Thank goodness. Outside, maybe like Jill Stein. I don't know. Okay. I'm glad you brought up Air Force One because we did see that with Air Force One. We saw it with F-35 as well. But in the Air Force One case specifically, part of what was notable there was the shift to a fixed price contract that happened. That's right. And it shifted risk and the financial ties associated with risk from the government and thus the taxpayer to the company, which in that case has been Boeing. And we've seen that showing up in quarterly earnings and everything else with charges. So it raises the question, do we see more of that type of contracting moving forward?

And I know you and I have talked about this in the past, but does it mean that you need to actually increase defense spending then to get more or can you do it with less? I think you can do it with less if you do it right. Look, I strongly believe in contractors being accountable for what they do. It is ludicrous to have a business model that allows companies to fail at what they do and make money. And the more they fail, the more they make. This is the terrible thing about cost plus contracting. You can often make more money by doing a lesser job, a worse job, by being late, by being more expensive. And now, I'm worried that you have major defense contractors, including Boeing, including Raytheon, saying that they're going to move away from even bidding on fixed

price contracts. And to a certain degree, I think that's an attempt to pressure government out of business models that do make sense for the taxpayer. I said it again. I'll say it before. I'll say it again. My goal is to save taxpayers hundreds of billions of dollars a year. I don't think that sticking with the current contracting model is going to get there. I think that if you select the right companies with the right business models, you can succeed and spend less. I think another great example is a little bit outside of DoD. Look at, for example, what SpaceX has done in space launch, making launch literally a thousand times cheaper than it was when you had the government doing traditional cost plus work with a variety of different

aerospace contractors. I think that that is the type of innovation we need to bring to the DoD. There's a lot of things that we could be building for 10 times less, 100 times less, maybe even a thousand times less and be more effective. That's the way we're going to get to the moon. That's the way we're going to get to Mars. That's the way we're going to come a multi-planetary and eventually extra solar civilization. And it's the way that we're going to defend free shipping lanes in space, our asteroid colonies and everything else. That's not going to happen on a cost plus basis. I'm glad you brought up SpaceX because SpaceX, Palantir, Andrel as well have really forged the path for defense tech companies,

new players, upstarts to come in and do work with the DOD and others in government. And I wonder what you think Elon Musk is going to bring to the table with this administration. However, that that role plays out when we are talking about cutting red tape, cutting bureaucracy, and cutting spending. Well, at least particular to defense, Elon actually tweeted last night that we need to figure out how to be smarter on defense spending and that we need to incentivize more innovation, getting more companies involved. Really, we just need more competition.

Remember, we've seen consolidation since the end of the Cold War from dozens of defense contractors winning major programs to now 80% of the money going to just five companies, 30% of major weapons systems contracts having a single bidder. That lack of competition is not healthy for our country. It's not healthy for our economy, certainly not healthy for our military. I often joke that other defense companies have raised more money off of my success at Anduril than we have. And that's saying something, given that we've raised billions of dollars and our last round was at a $14.5 billion valuation. And I think that that is a really good thing.

A few years ago, there was a point where since the end of the Cold War, Anduril and Palantir were the only defense unicorns since the end of the Cold War in modern history. A unicorn being a company worth over a billion dollars. Palmer, we're going to have to wrap it up. I appreciate the time. We've got to get to Vice President Harris, who is stepping onto the podium at Howard University with her concession speech. Good afternoon. Good afternoon. Good afternoon. Good. Good afternoon, everyone. Good afternoon. Good afternoon.

Good afternoon. Thank you all. Thank you. Thank you. Thank you, thank you. So let me say, and I love you back. And I love you back. So let me say, my heart is full today. My heart is full today, full of gratitude for the trust you have placed in me, full of love for our country, and full of resolve. The outcome of this election is not what we wanted, not what we fought for, not what we voted for, but hear me when I say, hear me when I say, the light of America's promise will always burn bright. As long as we never give up and as long as we keep fighting. To my beloved Doug and our family, I love you so very much. To President Biden and Dr. Biden, thank you for your faith and support. To Governor Walz and the Walz family, I know your service to our nation will continue.

And to my extraordinary team, to the volunteers who gave so much of themselves, to the poll workers and the local election officials, I thank you. I thank you all. Look, I am so proud of the race we ran and the way we ran it. And the way we ran it over the 107 days of this campaign, we have been intentional about building community and building coalitions, bringing people together from every walk of life and background, united by love of country with enthusiasm and joy in our fight for America's future. And we did it with the knowledge that we all have so much more in common than what separates us.

Now, I know folks are feeling and experiencing a range of emotions right now. I get it. But we must accept the results of this election. Earlier today, I spoke with President-elect Trump and congratulated him on his victory. I also told him that we will help him and his team with their transition, and that we will engage in a peaceful transfer of power. A fundamental principle of American democracy is that when we lose an election, we accept the results. That principle, as much as any other, distinguishes democracy from monarchy or tyranny.

And anyone who seeks the public trust must honor it. At the same time, in our nation, we owe loyalty not to a president or a party but to the Constitution of the United States. and loyalty to our conscience and to our God. My allegiance to all three is why I am here to say, while I concede this election, I do not concede the fight that fueled this campaign. The fight, the fight for freedom, for opportunity, for fairness, and the dignity of all people, a fight for the ideals at the heart of our nation, the ideals that reflect America at our best. That is a fight I will never give up. I will never give up the fight for a future where Americans can pursue their dreams, ambitions, and aspirations.

Where the women of America have the freedom to make decisions about their own body and not have their government telling them what to do. We will never give up the fight to protect our schools and our streets from gun violence. And America, we will never give up the fight for our democracy, for the sacred idea that every one of us, no matter who we are or where we start out, has certain fundamental rights and freedoms that must be respected and upheld. And we will continue to wage this fight in the voting booth, in the courts, and in the public square. And we will also wage it in quieter ways, in how we live our lives, by treating one another with kindness and respect, by looking in the face of a stranger and seeing a neighbor, by always using our strength to lift people up, to fight for the dignity that all people deserve. The fight for our freedom will take hard work,

but like I always say, we like hard work. Hard work is good work. Hard work can be joyful work. And the fight for our country is always worth it. It is always worth it. To the young people who are watching, it is... I love you. To the young people who are watching, it is okay to feel sad and disappointed, but please know it's going to be okay. On the campaign, I would often say, when we fight, we win. But here's the thing. Here's the thing. Sometimes the fight takes a while. That doesn't mean we won't win. That doesn't mean we won't win. The important thing is don't ever give up. Don't ever give up. Don't ever stop trying to make the world a better place. You have power. You have power. And don't you ever listen when

anyone tells you something is impossible because it has never been done before. You have the capacity to do extraordinary good in the world. And so to everyone who is watching, do not despair. This is not a time to throw up our hands. This is a time to organize, to mobilize, and to stay engaged for the sake of freedom and justice and the future that we all know we can build together. Look, many of you know I started out as a prosecutor, and throughout my career, I saw people at some of the worst times in their lives, people who had suffered great harm and great pain, and yet found within themselves the strength and the courage and the resolve to take the stand to take a stand,

to fight for justice, to fight for themselves, to fight for others. So let their courage be our inspiration. Let their determination be our charge. And I'll close with this. There's an adage and historian once called a law of history is dark enough can you see the stars. I know many people feel like we are entering a dark time, but for the benefit of us all, I hope that is not the case. But here's the thing, America, if it is, let us fill the sky with

the light of a brilliant, brilliant billion of stars. The light, the light of faith, of truth, and service. H-U! And may that work guide us, even in the face of setbacks, toward the extraordinary promise of the United States of America. I thank you all. May God bless you, and may God bless the United States of America. I thank you all. I thank you all. I thank you. I thank you all.

That is Vice President Kamala Harris at her alma mater, Howard University, delivering her concession speech on the heels of the outcome of this presidential election, saying that she spoke to President-elect Trump earlier and congratulated him on his victory, and that while, quote, I concede this election, I do not concede the fight that fueled this campaign, going on to talk about how they will continue to wage this fight in the voting booth, in the courts, in the public square and in quieter ways, including how we live our lives, and that this is not a time to throw up hands, but a time to roll up sleeves. Well, Wall Street rallying on the election results with record closes across the board.

And the financial sector saw the biggest jump with brokers surging as well, including Interactive Brokers, which closed at a record high. Joining us now, Thomas Pederphy, Interactive Brokers founder and chairman. It's great to have you back on the show. And that's exactly where I want to start with you. this major move in financial stocks, including your own, in part perhaps because investors are anticipating deregulation here and more capital markets activity. Are the moves warranted? Well, I don't know if they are warranted to the extent that they have been, but you know, we certainly are looking at a better environment from a regulatory standpoint, and that is going to be a great deal of help because the regulators up to now have been

just, you know, we had fines left and right. Everybody in the business was fined for hundreds of millions of dollars. And I don't know to what end, but it's good that that is going to be over soon. We've seen massive moves in the markets over the past call at 24 hours across asset classes. We saw another online trading platform, Robinhood, saying that last night was its biggest ever equities overnight session since launching a 24-hour market. What have you seen on Interactive Brokers? We had absolutely the same experience. As a matter of fact, we started overnight trading well before Robinhood had. And yes, the overnight trading volume is very substantial. It's growing very, very quickly.

I think that in a few years, there will practically be no difference between trading during the day and trading at night. Liquidity will be equally good 24 hours a day. I do want to ask you, and last time you were on with me, we talked about the prediction markets. You have launched these products, these forecast contracts. We saw them being traded coming into this election. Yesterday, we had venture capitalist Keith Raboy on. I asked him about the prediction markets, and he said that he thinks it's going to be quite exciting. The biggest issue here is liquidity, but that as you see more and more liquidity come into the markets, that there really could be a big opportunity here. So I wonder what you think

it's going to take to see more liquidity come into prediction markets and also how big of an opportunity this is going to be or already is for interactive brokers. Well, I think I think this is going to be a huge market because we're basically asking existential questions from people like global warming and economic indicators as to what levels they will reach. And this is going to be a larger market, in my view, than the equities market, maybe in 15 years or so, because it's going to take a long time to grow, but it will grow very, very quickly.

And it is basically a global marketplace. So it is going to be the questions are equally relevant for people wherever they live around the world. Interesting. Thomas Pederphy, thanks for joining me today. Great to have you on. Thank you. Here's another name in the financial space that rallied today, BGC Group, which hasn't been mentioned in the same Trump trade basket as DJT or Tesla or Bitcoin, but perhaps it should be. BGC is a financial services company run by Howard Lutnick, who is also the co-chair of the Trump transition team

and has been a key advisor and booster during the campaign. BGC, among other things, recently launched a futures exchange, FMX futures exchange, to rival CME Group, as well as ICE and CBOE, with all three of those stocks bucking the rally to end the day in the red. So maybe another trade to watch there. Up next, famed venture capitalist Alan Patrickoff and how the tech sector and the VC industry could fare under President-elect Trump's second administration. Welcome back to Overtime. The Nasdaq closing at a record high after Donald Trump was made president-elect.

Tech investors now digesting the longer-term impact for the sector. Joining us now is Alan Patricoff. He is co-founder and chairperson of Primetime Partners. He is also a longtime Democratic donor. Alan, it's great to have you back on the show. Welcome. Thank you for inviting me. So I'm going to start right there. What does a second Trump administration mean for tech policy?

Well, from the standpoint of the venture capital industry, let's just mention that rather than tech policy. Venture capital does well in almost any administration, because primarily it's equity-financed. Interest rates are not a major factor because all these young companies that are start-ups and early-stage companies are financed with equity capital. So whether President-elect Trump won or whether Vice President Harris won, venture capital goes on, financing goes on, as it has before. What I'm concerned with today are really broader issues. I'm concerned that I hope President-elect Trump doesn't go through with a lot of the

things that he said during the campaign, which were hopefully campaign shout-outs rather than what are really going to be policies that are going to be implemented. I mean, mass deportation, tariffs, tax cuts, all of those, I think, are not great for the... I think we're having some technical... We just had a little bit of a technical glitch with a shot there, Alan. But I think we got we got most of it. I am curious about the tax piece of this, because that's going to be front and center looking at 2025, because you do have tax policy that was enacted back in 2017 and some of that is poised to sunset. So it's sort of top of the agenda. Given what you just said about venture

investing and given what it means for the startup landscape, would tech policy that is more favorable to business, though, actually be a good thing? Well, questions, you know, Lena Klankan is a major target of what everybody's concerned with in terms of the tech world and her uh activism in the uh anti-competitive uh arena as well as the justice department and i'm assuming that uh president-elect trump it's a long mouthful every time i have to say it uh uh we'll uh be dealing with that but i think that you know was mentioned before that technology growth of young companies is extremely important. Or we have an anti-competitive atmosphere. It sucks up young companies earlier, that growth, and therefore cuts off long-range growth of a lot of young, small venture-type companies.

So I'm very much in favor of letting these companies nurture and controlling. I'm not in favor of ending up with four, five, ten behemoths that really acquire everything. I'm much more in favor of a growth on a broader base and let our technology market nourish. I mean, a perfect example is in the AI field. We've seen in the last year hundreds of companies started up. Obviously, many of them, or at least some of them, will fail and others will grow. And hopefully we'll have the opportunity to become independent uh large growth companies on their own rather than becoming divisions of some of the major companies in

the country that we're dealing with but uh i'm uh i i think that we're in a very good time in the venture industry and prime time which focuses on investing in anything that services, whether it's technology or products for the elderly generation over 60, they're very concerned with Medicare, Medicaid, Social Security, maintaining financial stability. If we have a wild inflationary environment, that's not good. Retired people who have to live on a fixed amount of money. So the more, if we have irregular big swings in the financial markets because of excessive spending causing more inflation, that's going to be a big concern for older people who have to live out of money. Well, we'll see how it all plays out. Alan Patrickoff, appreciate your time today. Thank you. We have a quick update for you. NBC News is now projecting Kamala Harris, the winner of Maine. She gets three of the four electoral votes in that state, but it does not change the overall

outcome of the election, of course. Still ahead, much more on this record post-election market rally and how to position your portfolio ahead of tomorrow's Fed decision when we are joined by CFRA's Sam Stovall. Stay with us. Welcome back to Overtime. The Nasdaq closing at a record high after Donald Trump was named president-elect. Tech investors now digesting the longer-term impact for the sector. Welcome back to Overtime. The Nasdaq closing at a record high after Donald Trump was named president-elect. Tech investors now digesting the longer-term impact for the sector. Joining us now is Alan Patricoff. He is co-founder and chairperson of Primetime Partners.

He is also a longtime Democratic donor. Alan, it's great to have you back on the show. Welcome. Thank you for inviting me. So I'm going to start right there. What does a second Trump administration mean for tech policy? Well, from the standpoint of the venture capital industry, let's just mention that rather than tech policy. Venture capital does well in almost any administration because primarily it's equity financed. Interest rates are not a major factor because all these young companies their startups in early stage companies are finished with equity capital so uh...

uh... weather president-elect ron or whether uh... vice president paris one i have a picture capital goes on financing goes one lesson has before uh... what i'm concerned with today are uh... really border issues i'm concerned that I hope President-elect Trump doesn't go through with a lot of the things that he said during the campaign, which were hopefully campaign shout-outs rather

than what are really going to be policies that are going to be implemented, I mean, mass deportation, tariffs, tax cuts, all of those, I think, are not great for the... I think we're having some technical... We just had a little bit of a technical glitch with a shot there, Alan, but I think we got most of it. I am curious about the tax piece of this, because that's going to be front and center looking at 2025, because you do have tax policy that was enacted back in 2017, and some of that is poised to sunset. So it's sort of top of the agenda. Given what you just said about venture investing and given what it means for the startup landscape, would tech policy that is more favorable to business, though, actually

be a good thing? Well, the question is, you know, Lina Klont-Khan is a major target of what everybody's concerned with in terms of the tech world and her activism in the anti-competitive arena, as well as the Justice Department. And I'm assuming that President-elect Trump, it's a long mouthful, but every time I have to say it, will be dealing with that. But I think that, you know, it was mentioned before that technology growth in young companies is extremely important. The more we have an anti-competitive atmosphere, it sucks up young companies earlier, their growth, and therefore cuts off a long-range

growth of a lot of young, small venture-type companies. So I'm very much in favor of letting these companies nurture and controlling. I'm not in favor of ending up with four or five ten behemoths that uh really acquire everything i much more i'm much more in favor of a growth on a broader base and let our technology market uh nourish i mean a perfect example is the ai field we've seen in the last year hundreds of companies started up. Obviously, many of them, or at least some of them, will fail and others will grow, and hopefully will have the opportunity to become independent, large growth companies on their own rather than becoming divisions of some of the major companies in the country that

we're dealing with. But I think that we're in a very good time in the venture industry and prime time, which focuses on investing in anything that does services, whether it's technology or products for the elderly generation over 60. They're very concerned with Medicare, Medicaid, Social Security, maintaining financial stability. If we have a wild inflationary environment, that's not good. Retired people who have to live on a fixed amount of money. So if we have irregular big swings in the financial markets

because of excessive spending causing more inflation, that's going to be a big concern for older people who have to live out of money. Well, we'll see how it all plays out. Alan Patricoff, appreciate your time today.

Thank you. Thank you. Thank you. We have a quick update for you. NBC News is now projecting Kamala Harris the winner of Maine. She gets three of the four electoral votes in that state, but it does not change the overall outcome of the election, of course. Still ahead, much more on this record post-election market rally and how to position your portfolio ahead of tomorrow's Fed decision when we are joined by CFRA's Sam Stovall. Stay with us. Welcome back. All three major averages finishing with decisive record closes today following Donald Trump's presidential victory.

Let's bring in CFRA chief investment strategist Sam Stovall. Sam, great to have you on. We know who the 47th president is going to be. We know the Senate is going to be Republican led. The verdict's still out here on the House. But walk me through, assuming we either get a split Congress or a red wave, what that's going to mean now for the markets. Well, Morgan, good to talk to you again. But I really think the Republicans would prefer a red wave. The reason being that a split Congress works best for Democratic presidents. We've had six times since World War II in which that occurred,

and the market gained an average of 16.6 percent, rising 83 percent of the time. Yet under Republicans, a split Congress only delivered seven point three percent returns and a much smaller batting average or frequency of gains. The best performance for Republicans, however, was a red wave in which the market was up nearly 13 percent on average and posted a 75 percent frequency of advance. So what we're heading toward right now is optimal for Republicans. That's interesting because so much of the common talking points out there are that a gridlocked government is actually a good thing. The market's like that. And basically what you're saying, specifically in the case of a red wave, is that, no, that that performs much better.

That's right. Maybe you could justify by saying that, you know, people call the Democrats the party of tax and spend. Well, if there is some control on that spending through a split Congress, something that really would only benefit both sides of the aisle, then that would get approved, whereas others would not. Possibly that could be a reason behind it. So we shift from fiscal policy to monetary policy. We have a Fed decision tomorrow, largely expected to cut another 25 basis points. Perhaps what's what's more unknown is what the trajectory of future cuts are going to look like. How does and I realize there's a Chinese wall, but how does the fiscal piece of the puzzle now help shape or not shape what that trajectory looks like into 2025 and beyond?

Well, I think it continues the momentum that we generated today because we had very good returns across the market. The mid and small cap stocks finally had their day in the sun. And also a majority of the sub industries did quite well, led by financials. But I would tend to say that we think the Fed will cut rates when they announce tomorrow afternoon. There's not going to be a summary of economic projections coming out or dot plots that will come in December. But we think that there will be a cut in December. But then they'll probably move to quarterly cuts in 2025. So another 100 basis points cut in all of next year. So the Fed will likely take a more measured approach.

I have 30 seconds left with you. So very quickly, record highs. Do we move higher from here? Yes, we do. I think that we have a very good chance of possibly a three peat in 2025. And if not, we have a very high possibility of a positive return with an average of at least six percent. OK, Sam Sobol, that was quick. Thanks. You got a lot in there. Appreciate it. My pleasure. All right. As I mentioned, a record day for the major averages. Add the

transports to that list as well. And the Russell 2000 at its highest level in three years. You saw every sector except utility. Well, you saw financials lead the gains here. That does it for us here at Overtime. Fast Money begins now.