Closing Bell - Closing Bell Overtime: Stocks Turn Page After Strong April 5/1/26

Episode Date: May 1, 2026

Ayako Yoshioka of Wealth Enhancement Group talks positioning after a strong April and where investors should focus next. Oil stays front and center: Sam Margolin of Wells Fargo breaks down how energy stocks are reacting to Exxon and Chevron earnings. Katie Stockton of Fairlead Strategies analyzes the technical setup and whether recent momentum can continue.  Mike Santoli is in Omaha, NE ahead of Berkshire’s annual meeting, previewing what to expect from CEO Greg Abel as he takes charge for the first time. Longtime Berkshire watcher Chris Bloomstran of Semper Augustus on what he is watching most closely tomorrow. Barbara Doran of BD8 Capital highlights the biggest winners and what’s working in this market. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

The bell is bringing an end to the trading day at the NYC, Charles Schwab, the Boys and Girls Clubs of America, and the SIFMA Foundation, all celebrating National Investing Day and at the Nazak Gold House doing the honors. Welcome to closing bell overtime. Lash in studio be at the NASAC market site. I'm Melissa Lee. Mike Santoli will be joining us from Omaha in just a moment. Stocks mostly hired today, the doubt with a small loss, but the S&P, up a quarter of a percent to a record close. And the NASAC, the best of the bunch, up nearly 1 percent, also a record close. Apple leader following its earnings, Intel continuing its run.

It's doubled in the past month. Oracle and Salesforce also with nice games. That is helping software, the IGV, up 3%. Atlassian and Twilio, each up more than 20% following their results. And Viva Systems, which makes software to help drug companies manage clinical trials, is being added to the S&P 500. Nice pop for that one, too. And this wraps up another good week for the markets.

All the major averages up right around a percent. It is the fifth straight winning week. for both the S&P 500 and the NASAC. And it was a very busy week with earnings from five of the MAG 7. Stocks came through it at record highs. Record highs. Mike, you're in Omaha for the Berkshire Hathaway meeting. But quick thoughts on the markets.

What an extraordinary. I mean, if you had said which way are the markets going to trade at the beginning of the week, I don't know if either of us could have had a good guess on that one. For sure. I mean, look, this market's kind of defied the headlines or the headline concerns, at least, for a little while here. Clearly, it has just decided that it will just ride the path of maximum conviction, which is only along the AI investment front and say that's enough for now. We have an S&P 500 that's constructed to capitalize on exactly that.

It's, you know, 35, it's 40% tech. And then if you add Google and meta, it's up to, you know, 45 or something like that. So clearly that's been the story. The rest of the market has at least stayed out of the way. I would argue. And if anything, the consumer stuff is maybe first. up just slightly because yesterday's economic data were at least okay. Yeah, even in spite of $4.30 cents gasoline right now, highs not seen in years.

But what was so optimistic about the action this week, I thought, Mike, at least, was that the Mag 7, the ones that reported, they didn't all go higher. And yet the markets still turned higher. And so that seemed to be the markets running with this, just the message, the narrative that the AI trade is on. There is enough positive news out of Washington to believe that we are on. track still toward an end to the conflict in Iran. And that was enough for records.

Yeah, dispersion within the MagS7, dispersion within the overall market. It shows in a weird way that the market can kind of balance itself on the way up. That's why you have the VIX under 17. By the way, that's back toward normal levels. Now, some of the stuff that's been leading clearly looks a little bit overplayed in the short term. So we'll have to see how that goes. You just mentioned what Intel has done. I would also note semiconductors as a group underperform for the week.

They flattened out. They were the ones that led us higher. So we do have to watch and see whether, in fact, we're kind of at a culmination moment for that theme. Let's talk about the meeting there, Mike. It looks like the crowds have really come. It's a big one. Obviously, it's the first one for Greg Abel, who's taken over for Warren Buffett. So what are we focusing on here? I think we're focusing on exactly what different tone we might get from that meeting from Greg Abel rather than Warren Buffett. Now, clearly the questions toward Buffett were always often big picture. What do you think of the macro? Do you think the market is expensive or cheap? You know,

what about the federal debt? Things like that. I'm not sure we're going to get as much on that from Greg Abel, who's much more of an operator. He did not make his bones picking stocks. Warren Buffett's the first guy who made $100 billion fortune just by picking stocks. So I think there might be an emphasis more on the performance of the businesses. Clearly, what are they going to do, if anything, with all the cash, $380 billion or so of cash? And how will they think about allocating capital from this point forward. I think of the key unanswered questions at the moment. Yep. Michael, see a little bit later. Yeah. Let's get back now to the broader markets. The S&B 500 and NASDAQ hire for a fifth straight week as big tech, mostly deliberate in his earnings

reports. Can the AI trade continue lifting the market? Joining us now as wealth enhancement, senior investment strategist Ayako Ayako Yako Yoko, great to have you with us. Thanks for having me, Melissa. How are you? Good, good. I mean, you're heavy into the MAG 7. And so, you know, it's interesting to see them report. They all had largely decent results. Some of them raised capbacks. And the dispersion, as Mike and I were just talking about, in terms of how the stocks reacted, how do you process that? Sure. You know, when you look at them collectively, especially the ones that reported this week, you know, we're seeing huge moves. They're all reporting double-digit revenue growth and solid earnings growth and with great profit margins. I think the one thing that we're sort of continuing to digest is the fact that free cash flow margins for the most part are dwindling a little bit just because of that cap-back spend. But you're seeing it in that cloud growth that Amazon and Microsoft and Google are all showing. And so that's what we're counting on that that continues. When you think about that sort of CAP-X bill and how it's increased, I mean, a lot of that increases because of higher costs, memory costs are higher.

I mean, lots of things are higher, as opposed to that same dollar buying more, that same dollars buying less. So how do you think about CAP-X and how that can boost its operations when the numbers are bigger, but what they're getting may be the same? Absolutely. I think that just means that the duration of this spend might be a little bit longer than we would all like, at least from a free cash flow perspective when you're looking at the financials of these hyperscalers. But that also means that the infrastructure build out for AI is likely to continue for a little bit longer as well. You are optimistic, though, the space overall and the markets are – I mean, it was a stellar week in terms of earnings.

I mean, of the companies that have reported so far, 28 percent earnings growth for the overall S&P 500 and more than three quarters have been. and both on the EPS side and the revenue side. Absolutely. And the market in general is still trading at around 20, 21 times in terms of a PE multiple when you look at forward earnings. So, you know, I know it's a little bit more elevated relative to the averages in history, but when you look at what you're getting in terms of the overall earnings growth, and the fact that it's not just the seven stocks, you're seeing that broadening out,

all of that cap-back spend is going to several other areas. industrial, materials, energy companies, you're seeing that broadening out. And so we think that it still got a lot of value for 2026 and beyond. You know, when the conflict began, there was a narrative that, you know, if the conflict lasted more than four to five weeks, then it would be concerning to the markets. It would be concerning to the economy. And here we are. It's months later.

And still no impact to the equity markets. You yet oil prices are high. Do you see that as a conflicting message here or do they live together in this world? Is that fine? It's a little conflicting, but I think it goes back to timing of all of this. When are we going to see some of this economic damage from higher energy prices? And it may still be on the come in the coming months or so. But in the meantime, the current sort of what we know right now is that from earning season, AI and tech spend,

continues to be what investors are really interested in. So you're not worried. It may come, but it's down the line. I'm not going to worry about it now. I'm going to go with the momentum. When you look at the market overall, you know, again, with tech driving so much of that earnings growth, it's not necessarily going to dent that overall earnings growth. But when you look at companies individually, I think you still have to parse a lot of that out. So depending upon the cost structures of certain companies, you want to make sure that you're not going to make sure that you're not going to get hit from an underlying profit margin perspective. Hey, are great to have you with us. Thank you. Thanks for having me.

Well, today's gains coming as oil falls slightly, but WTI still holding onto the $100 a barrel level as negotiations with Iran continue. Pippa Stevens has the very latest. Hey, Pippa. Hey, Melissa. Well, oil is under pressure today after Iran sent an updated peace proposal to mediators in Pakistan. Although President Trump later said that while Iran wants to make a deal, he is, quote, not satisfied with it. Now, Brent is coming off its first negative month in four, but still above 100, and we have seen the curve come up as the market remains stuck in a no war, no oil type environment. Now, a key question is how much storage Iran has left, with the administration arguing they will be forced to cut production. But new data from Kepler

shows that while the blockade is stopping laden tankers leaving the Gulf, it's not stopping ballast tankers from entering. Those can then load and act as floating storage. It's not a long-term solution, but it can potentially extend the timeline. There's also still oil at sea with 77 million barrels in range of Chinese ports, the firm said, up from 54 just before the war started. Now, eventually Iran would be forced to cut production, but some firms noting they've done it in the past, and especially if they have the ability to ramp down in a controlled manner, they can avoid extensive damages. So the bottom line is that Iran can potentially withstand the blockade for longer than perhaps early estimates had projected. Melissa? Pippa, thanks. Pippa Stevens.

Now to the impact of asserting oil prices on America's two largest oil companies, Exxon and Chevron reporting results this morning, both beating on Wall Street estimates, but posting lower profit than last year, Exxon CEO telling CNBC this morning about 15% of the company's production is impacted by the Iran war. How should investors trade these names as the war drags on? joining us now, Wells Fargo Senior Energy Analyst, Sam Marglin, Sam, great to have you here on set. There was an accounting fluke. There was some hedging activities. But the bottom lines, it sounded as if the CAs were saying that the impact of higher oil prices will really benefit in the current quarter and in future quarters. Is that right? Yeah, that's right. There were some hedging losses.

You know, the volatility in the quarter really caused some accounting issues and some sort of volatility problems in the physical market. And that was all pre-announced. So they said that a month ago. And we were just waiting for the update to see what the forward look was. And that's right. Some of these losses will unwind organically just as those derivatives roll off. Right. They close them out.

And then also, the oil market is just much more stable than it was in the first quarter. So you won't have these volatility-induced losses. And, yeah, you'll probably start to see the impact show up next quarter. So the real earnings power from these higher oil, elevated oil prices will be in this current quarter and potentially, depending on how long the conflict goes in the- the third quarter. I mean, unless it gets worse. And I mean, one of the themes on the calls were, was that, you know, inventories in the world have been able to stabilize the market. And any given time before the war, there was like four and a half billion barrels of oil

in storage. And now there's four billion barrels. And that sounds like a lot. But the problem is it's not evenly distributed. So some places have less than others. And that place that runs out first has to pay the highest price. And so it's not that the world runs out of oil, but one place has a squeeze. And then that becomes the benchmark price. And you can still have volatility, even when it looks like things have stabilized for a couple weeks. And they really want, I mean, oil companies in general really want a stable price, not necessarily the highest price, but a stable price that you can actually model. That's right. They want a stable price. They want all trade flows acting normally.

Even away from the straight, there's some abnormal things happening. Trade flows have reversed. Asia's usually an exporter. Now it's importing from places that it typically exports to. So there's all sorts of messed up attributes in the market today. And so everybody wants it to normalize. And then on a structural basis, after everything's back to normal, there will be restocking demand. Right. So as you look to next year, there's sort of an extra layer of oil demand that benefits the market because all these inventories need to be refilled. And maybe even at higher levels than they were before, just to protect consumers. Yeah. I mean, I was going to ask about how we should rethink about where reserves live and where reserves might be started,

given some countries may not have had reserves and may be thinking about their oil supplies in a different way after this conflict. Yeah, so just to restore where we were before, it'll take one to two years because that's really that's all there is in terms of excess supply that can be redistributed away from end users and into storage. But if we want to go higher than we were before in storage, you know, now you extend that runway and you create a whole new cycle. So yes, on top of the fact that this is a dangerous situation for people and the economy

and everybody's employees who are stuck there, it would be great to get to the other side of it just to get to that environment. where it will be much better for all these companies. But in that world where it's going to take that long to restock in a world in which, you know, there might be new reserves created by countries that don't already have one, is that higher for longer oil prices? Well, compared to what we thought before, I mean, the most important piece of context here is that oil made a low on December 15th.

And everybody thought this was going to be the worst year ever for oil. Right. And so compared to what people thought before, certainly it'll be higher for longer. whether it stays up here, that's probably a long shot. But I think just given where expectations were, you can certainly expect a longer cycle. The two companies seem to be pretty resolute in terms of keeping CAPX pretty firm. They didn't want to go, they didn't want to expand a lot, which is probably a good thing to prevent that sort of boom bust that has impacted the industry in the past. But at the same time, I mean, how should we think about how they're spending money

and where they spend their money given the conflict? Yeah. So the message today was that they've spent the last decade selecting projects for a market that demanded selectivity. So we were past the era of investing in everything, chasing every project, bidding against each other, and everybody was much more focused on high grading their portfolio. And so they're set up exactly the way they want to be, and therefore there's just not an opportunity to raise activity. I mean, in the U.S. where things can be a little bit more nimble, if this goes on, you might see some activity ramps in six to 12 months, but that's about duration, too, because the forward curve is still at 75. Let's say you're choosing your own adventure in terms of the trading context. Let's say it is

the conflict lasts longer, oil stays higher for longer, what sort of oil company do you want to be invested in? A company with idiosyncratic portfolio attributes that can grow the dividend in any oil price environment. So the stock that we've been most focused on didn't report today, reported yesterday, it's Conoco Phillips. And Conoco Phillips has a project in Alaska that they've been working on for a number of years, it significantly increases their dividend capacity. But even before that, they have spending rolling off as the project advances. They have other projects coming in. So even if oil fell in half from here, back to 60, it would still be able to compete on dividend growth with the rest of the income income. And so I think Exxon and Chevron

could do that too. Right. But those are the kind of things that we're looking for, less so than commodity toy. Sam, great to speak with you. Thank you for coming in. Thanks so much. San Marguillin. And take a look. We just want to show you the University of Chicago, bringing the closing bell at Cebo in Chicago, ending the regular trading day for options. Well, auto sales numbers out for April today are those persistently high oil prices changing consumer preferences. Philaubo joins us now with that. Hey, Phil. Melissa, they are changing preferences, though. The overall state of sales, roughly the same as what we saw in March. We haven't got a final number yet. It's expected to be about a pace of 16 million vehicles.

in terms of the foreign automakers reporting their results for the month of April, they were all down fractionally. I wouldn't read too much into these numbers, but a couple of things stand out. Yes, gas prices, and remember, gas right now is an average of $4.39. It was down closer to $4 at the beginning of April. So the prices rose by 7% during the month. What is the impact of a 7% increase in gas prices? It means that you have a company like Toyota, as we take a look at shares of Toyota.

their EV and hybrid sales in April up 11.2 percent. And remember, basically one out of every two vehicles that Toyota sells in the U.S. is an EV or a hybrid. Similar story for Honda. It's EV and hybrid sales made up 29 percent of their total vehicle sales in the month. Bottom line is this, Melissa, if there is a hybrid on the lot, dealers tell me it is in demand. And Phil, I got to ask you about spirit. President Trump talked today about a potential plan to save the air.

line, what's going on there? And he's about to talk in a few minutes down at an event in Florida. Here's where things stand with Spirit. They are on the cusp of ceasing operations. In fact, the Wall Street Journal was out with a report today saying that they're close to ending flights. Bondholders have rejected the latest offer from the United States government in terms of a bailout.

1.8% of the U.S. airline market, that's how many seats Spirit makes up. Not to make light of the situation for the thousands of employees who work at Spirit, but this is a very, very small part of the overall U.S. market. Here's the president talking earlier today about the state of negotiations on a bailout. Well, I guess we're looking at it. If we could do it, we'd do it, but only if it's a good deal. It's claiming that they're preparing to shut down this weekend because they haven't gotten a deal. Well, we're looking at it, but if we can't make a good deal, no institution's been able to do it.

I said, I'd like to save the jobs, but we'll have an announcement sometime today. We gave them. We gave them a final proposal. By the way, as you take a look at the airlines that would benefit, if you will, if a spirit goes out of business, it's not going to be a huge benefit, but all of them, all of them have said that they will be offering some way of compensating or helping out the passengers, Melissa, of spirit flights if flights are canceled. All right. Phil, thanks, Phil Lebo. The NASAC closing the week with a 1% gain. The big semi-ETs also higher Intel gaining 20%, but Nvidia was down 4%. Should investors be worried? read. We'll see what the charts are saying. You're watching closing bell overtime live from the NASAC market site.

SA Lodder hired today, as it says its turnaround plan is gaining traction. The company raising its full year outlook, but also ramping up its cost cutting. Now saying it will cut 9 to 10,000 jobs up from a previous estimate of 5 to 7,000. It says the additional cuts will mostly come from those demonstration rolls in department stores, so maybe fewer people spritzing perfume at you. Instead, it will focus on Amazon and TikTok shop, which it says are higher growth channels. Well, this week's gains for the market coming without the help of Invidia. The stock is down 4% this week. A big drag on both the NASDAQ 100 and the Dow.

It's still the biggest stock in the world, even though it is given up the $5 trillion market cap level. So what are the charts telling us about where it could be headed next? Joining us now is Katie Stockton from Fair Leave Strategies. Katie, great to have you with us. It seems like 200 is a trouble spot for Nvidia. Yeah, it's great to be here with you. Nvidia just hasn't really kicked in like the rest of the market this week recently. And I think that's part and parcel with resistance on the chart.

You can see that it's been range band for several months. The resistance that we were watching was right around 212 on the chart. So it was a natural place for it to meet some selling pressure and pull back. That pullback was associated with a short-term counter-trend signal from the demarc indicators denoted by the arrow. We do pay attention to those when they're associated with a little bit of a down-tick and momentum. it does suggest that we'll see more near-term downside from NVIDIA within the context of this wide range that we have. However, we of course have seen improved intermediate term momentum around the recent rally. And with that, we expect ultimately that pullback to potentially give way to a breakout.

How does this predicted move in Vindia inform you about where the socks will head? Well, the socks has had just an incredible run. And this is something as a technician that we have to be very mindful of. We saw 18 consecutive updates, which has been widely publicized from the socks. And you can't help but compare that, unfortunately, to the dot-com bubble. And I live through that, and I remember how it felt. And it was the only time that kind of I could liken this rally to from April in the semis. Now, that's not necessarily a bearish takeaway, to be clear.

there's still a very good momentum behind the semiconductor stocks. But there are some comparisons that are fair between today's action, which, of course, you see that sharp rally and the action into the March 2000 peak, which of course was that dot-com bubble bursting. And it's not just the sharp nature of the rally or the consecutive daily up days, but just the steep nature of that rally. And I think it should warrant some risk management. It's not to say you sell right here right now, but as soon as you see that momentum down tick, I think we should pay attention.

And that's for the NASDAQ 100 specifically, fifth positive week in a row, but what are you seeing there? The NASDAQ 100 has broken out alongside the S&P 500, and even with the magnitude of that rally, which does draw some skepticism reasonably, we want to believe breakouts on the chart. So the breakouts do set a more positive tone for the second quarter, and yet it probably would not preclude some more digestion in here. We saw a little bit of that earlier this week and perhaps even a pullback for a better entry point. So we believe the breakout, a longer-term measured move objective we could derive for the NASDAQ 100 is only about 2.5% above current levels. So ideally, we can see a pullback that would lend a more favorable risk reward to that

measured move objective. Katie, if you can come on over to the desk, I'd love to ask you more about the broader market since it has been an extraordinary week. I mean, new highs for the NASDAQ as well as the S&P 500 on the close here. But this as oil prices remain elevated. So which charts are right? I mean, is it the equity chart or the oil chart? Yeah, I think right now they're both right. I mean, the market's always right, right? Right. We can't tell it what to do. And to me, the crude oil shock that we have seen remains one of the biggest risks right now. Then you can also add in this semiconductor sector strength. as actually a risk, not necessarily a benefit. It's driven the breakout. The breakout looks like

it's confirmed and real. But that overarching risk is there, and it just means that we need to be more sensitive to a loss of momentum. And I want to ask you about some specific huge winners in the socks, Intel, some of the memory players. Are they overstretched? I mean, they appear overstretched. We actually don't have a lot of cell signals, which is in part why we highlighted the cell signal in NVIDIA today in our research because it was differentiated from the space. But when you see the gaps up like an Intel, we like to watch those gaps. If you see the stock come in and penetrate the gap pretty quickly, that's usually a setback. Usually we'll tell investors that it's overdone.

So that's a great gift from the market that we have these gaps to reference. All right. Katie, great to see you. Thanks for coming in. Katie Stockton, a fair lead. We've been talking a lot about Warren Buffett and Berkshire Halfway today. One of Buffett's famous lines is about going against the market, being greedy when others are fearful. And that's the exact reason given for why one brokerage is upgrading this mystery stock saying investors are too pessimistic. And an update on the story we just talked

about with Phil LeBoe reports right now saying Spirit Airlines is expected to cease operations early tomorrow morning. We'll be following this story closely. Over time, be right back. shares a Paramount Skydance jumping today as Morgan Stanley gives a stock a double upgrade straight from underweight to overweight. The firm calls it a risky and out of consensus call, but believes if the Warner Brothers deal closes this year, it represents a big, bold, game-changing move and creates a company with some of the best intellectual property in the world. Even with today's gains, a stock is still down 16% this year, but Morgan Stanley says that investor pessimism is what presents this opportunity. Well, bond yields flat today, closing on a very busy week on the economic calendar, which also included the last Fed meeting of Jay Powell's tenure as Fed chair. But there's some intrigue in the currency markets. Let's get to Rick Santelli in Chicago. Rick. Oh, boy, there's lots of intrigue. Let's start with the dollar index. Briefly, if it would have closed at its worst levels this morning, it would have been the lowest close since the conflict began on the 27th of February. and it had a bit of a bounce to avoid that,

but the bounce really is small in the context of how large the move was. And what was the move? Well, look at a two-day chart of the dollar yen. Look at Thursday night. You see the dollar breaking there? It was a reported intervention. Now, it wasn't officially announced as an intervention, but pretty much many news sources reported it as such,

and it's easy to somewhat track the dollar amount, and that dollar amount seems to be in the neighborhood of $34, billion, and that would be very close to the intervention that they had in July of 24 when it was about 36 billion. And that was the last time they defended this 160 level, as you see. And the reason they defended it back in July of 24, let's shoot back to 1986, is because that is the highest the dollar was going all the way back into the 1980s. Now, do remember, the euro is 57.6% of the dollar index.

The yen is 13.9%. So it took a lot to leverage that size move, of course, in the dollar index. But that wasn't the only news. We had prices paid this morning come out at 84.6. That is the highest in four years. And that definitely put some volatility in the interest rate complex, as you pointed out. Pretty steady on the day, but still up seven basis points on that tenure on the week. Melissa Lee, back to you. Rick Santelli, have a great weekend. Time for CNBC News Update with Angelica Peebles. Angelica.

Yeah, Melissa, a Boeing 747 gifted to President Trump from the Katari Royal Family for use as Air Force One is expected to arrive at Joint Base Andrews this summer. That's according to a new report. The Wall Street Journal says the plane has undergone a $400 million overhaul by the U.S. government, but that its lavish interior remains roughly the same. Brown University cut its position in a Blue Owl Private Credit Fund, according to a new filing. University reduced its stake in one of the firm's publicly traded business development companies by more than half.

It comes as investors scale back their exposure to the private credit industry after a historic level of redemption request. And a Florida congressman David Rivera was convicted in a federal court for illegally lobbying U.S. officials to ease pressure on ousted Venezuelan President Nicholas Maduro. prosecutors allege that after Rivera left office, a Venezuelan state-run oil company secretly hired his consulting firm for $50 million to lobby on behalf of the government. He's expected to face about 10 years in prison. Melissa, back over to you.

Angelica, thanks. Coming up much more in the markets with both the S&P 500 and Nazai closing on record levels. And let's get back to Mike in Omaha. Mike, what's coming up? Mel, we're going to talk to an investor who has owned Berkshire Hathaway for more than a quarter century,

He's been coming to this meeting since then and does some of the most extensive valuation work on the stock. I'm going to ask him what to expect tomorrow at Greg Abel's first annual shareholder meeting. Let me come back. Welcome back to closing bell overtime live from the NASDAQ market site. The doubt falling slightly today, the S&P 500 with a small gain to a record closing level. The NASDAQ up nearly 1% also a closing high above 25,000 for the first time. And that wraps up another winning week, five straight weeks and fact of gains for both the S&P 500 and NASAC. Now let's get to Mike in Omaha.

Melissa, thank you very much. I am here in Omaha, Nebraska, for the annual Berkshire Hathaway shareholder meeting. This, of course, is the first one not being led by Warren Buffett. He is here, but CEO Greg Abel will be running the show. With me now is Chris Blumstrand. He founded investment firm Semper Augustus and is a longtime Berkshire investor and analyst. And Chris, it's great to see you. Nice to see you. I've long followed your exhaustive work writing about Berkshire Hathaway and analyzing the businesses. What's the biggest thing you think you might want to get clarified from Greg Abel tomorrow in terms of his areas of emphasis, his priorities,

how he's going to view the operating businesses versus the investment side? Yeah, I'm looking forward to hearing from Greg, the operations, his cohorts that he has joining him, he's been on stage for a number of years, but you've got Katie Farmer from the railroad, and they've got some operational issues they're dealing with. They've made some progress, but they've got ways to go. You've got Adam Johnson, who Greg appointed to oversee 32 of the subsidiaries in their consumer

and their consumer service and retail businesses. So you're going to get a much more business-oriented meeting. But when it comes to Greg's role as CEO, he's done a great job already for the eight years he served as vice chairman overseeing all of the non-insurance operations. But his role really is capital allocation now. That's been Warren's baby up until he retired at year end. And as everybody knows, Berkshire's got a lot of cash that's accumulated largely from logically selling Apple and some of the other holdings. I don't think it was reflective of an imminent market crash.

But of Berkshire's $370 plus billion of cash, 100 is required for insurance reserves. But there's 270 billion, let's call it, of cash that needs to be deployed plus an ongoing $40 or so billion per year that they generate operations. Yeah. And where Warren acknowledged that in 0809, he didn't do enough. They got the three and the $5 billion in GE and Goldman and some Dow preferreds and later some B of A. He didn't do much in the stock market. And Berkshire had 14% of its assets in cash at the time and said, I should have done more. Well, I think Greg gets that.

And so now it would not be the time, but at the next recession, financial crisis, pandemic, whatever comes down the pike, he's got to put that liquidity to work. And I think he will. So some color on that would be great to hear. Now, would you imagine that he would be more oriented in buying full business? It just strikes me that he's not come up as a stock picker, and therefore maybe, you know, kind of running a portfolio of public equities might not be exactly what he'd prefer to do, but I guess it could go either way. Yeah, he's spent a career doing deals in the energy world, so he's bought a lot of businesses.

Berkshire's so big that the opportunity set to buy entire private businesses is getting more and more limited. There aren't that many businesses that would move the needle that are private. He could buy entire public companies. the real opportunity is going to come in the stock market, either in the fractional shares of the companies they already own or more, some of which might be kind of farm system type investments that Ted would be running. You get disruption from AI if he was inclined to buy S&P Global or things like buy more Moody's, even by a Microsoft. There are some big cap companies that are plenty of liquid where he can put a lot of money to work. So I think it's probably not going to come into privates and the quaint notion anymore that a private business.

business owners going to sell their business to Berkshire for a discount. And you've got all this private equity money sloshing around. Especially you don't have that Warren Halo effect if they ever existed in the first place. Now, how do you believe right now this stock is valued after this kind of soft patch and relative performance from a very high premium a year ago? A year ago to this day, it traded its all-time high. And for the first time in 25 years of our ownership of the company, it was trading above my appraisal of intrinsic value and the stock declined.

But it's correlated somewhat to the insurance industry. We're on the back end of a very hard, profitable insurance cycle. So you can expect insurance profits. And in Berkshire's case, they're going to write a lot less business coming down. The stocks drops efficiently and operationally they've grown to where I've got it at about 80% of what I'd call intrinsic value. And it's trading a point where Greg announced that they started buying the stock back. Exactly.

Really at the same fundamental level where they stopped buying it two years ago. We've been buying it at these levels and increasingly large portions. For two years, as Berkshire slowed off their purchases, we likewise were buying. less and less and less of it. And when it traded down in August, we bought a bunch of it, rallied back up. Yeah. Bought more around the time Greg announced they were buying it than it shot up for a while. But it's now back trading below where it was when Greg been in the ounce of it.

So we're buying it. Greg's buying it. All right. You know, to see how much he's bought on Berkshire's behalf. We'll see the queue as well. Yeah, for sure. Look forward to that tomorrow morning. So maybe a little more of a cushion built into the valuation, Chris.

Great to see. I really appreciate your time today. Thanks. Thank you. Mel. Oh, and by the, way, you can, of course, watch live coverage of Berkshire Hathaway's annual shareholder meeting on CNBC.com starting tomorrow at 915 a.m. We will be right here, Melissa. Yeah, you got a long day ahead of

you tomorrow, Mike. I'm just wondering, you know, in terms of Greg Abel and thinking about the areas he couldn't invest in, listening to you and Chris, I mean, does it seem like Abel might be inclined to go into areas that traditionally Berkshire Hathaway has not gone into? And I'm thinking, you know, think of the industries that have been disrupted by AI, not just S&P and Moody's, but the software industry, you got a lot of portfolios that are up for sale at this point. Well, as Chris mentioned, Microsoft, it would almost seem to be kind of the profile of a Berkshire type company in terms of the multi-generational value. Of course, there used to be that relationship with Bill Gates. I do think there's a possibility of that. But also, you know,

as we were suggesting, maybe there is a little bit of low-hanging fruit on the operating side while we wait for dislocations in the public equity markets for them to see maybe some fat pitches come along. So I would anticipate hearing a little more about that as well that you could manage a little more closely on the wholly owned subsidiary side and see if that becomes a better source of returns, at least in the next couple of years. All right. And Mike, I got to know, what is the hottest chotchky there this year? I mean, what does everybody want? I wish we could get away from the squish mellow stuff, but they keep making new ones. So they have these co-branded, you know, Able, Buffett, Squishmelows in the Net Jets Jet, another one's in BNSF trains. So I think that's probably the hot one.

They're also trying to push Greg Abel's favorite candy, which apparently is some kind of a chocolate pecan thing. Oh, that sounds kind of... That's a seize candy, of course. Yeah, yeah, of course. So let me know. You can put in an order, whatever you want. I'll bring it back. I'll shoot you the email.

Mike, thanks. Catch you tomorrow at 9. All right. Apple, Inton. and Caterpillar, three of this week's big winners. Up next, we'll discuss whether those names can keep rallying. An earnings winner this week is Apple closing out the day, 3% higher after last night's earnings results. That report helping Apple end the week as one of the Dow winners.

So how should you trade that stock in some of this week's other big gainers? Joining us now, Barbara Doran from BD8 Capital Partners. Barbara, great to see you here on set. First, just quickly, I want to continue the conversation we were having during the break, and that is sort of the head-scratching rally. We are at record highs, closing highs at the S&P, as well as the... NASDAQ and you're just hanging in there. You can't, you can't move away from it at this point. No, no, I think it's hard when, you know, typically when you have such a run like this.

I mean, we know NASDAQ was up 16 percent. We're making new highs today. There will typically be a pause in the market. And certainly when you look back, there's been some interesting historical comparisons in the last 35 years. There's only been four times where we were up 10 percent a month, and then there was always underperformance after that. So that would be normal here. However, as we were talking about, the earnings coming in are just breathtaking. I mean, just a week ago, we were looking at 16% earnings growth in the aggregate for the S&P 500. We're now just under 28%. That's extraordinary.

And the profit margins are coming in much stronger. They're at record highs and even their predictions for the rest of the year. So we've got great earnings and profit margin growth to support this market, but you also have the unknown, you know, Iran, which nobody's paying attention to right now. But their supply shock impact can take a while to feed through. But it looks like things are so strong here. And you don't know that we talked about productivity. That is definitely going to happen in terms of keeping inflation tamped down. But how long does that take to feed through?

Maybe it's speeding through right now. Right. We don't know. No. Apple, they posted a great quarter. The guidance was very strong. Even in spite of supply constraints, whether it be parts for the Mac or memory increases in terms of pricing, was it even better than you thought. I mean, it seems like it would surprise everybody.

It was. I think it really did surprise everybody. I've owned Apple for a long time, but even, you know, it's just sort of being patient because there is a question about, you know, how well would the iPhone sell, what's happening with their new Mac computer, is services peaking, and there were lots of questions, but they blew away the numbers, as you saw. I mean, earnings were supposed to be up 17%. They came in 22%.

Revenues were supposed to be 14%, up 17%, but what really did it was the guidance up dramatically for revenues this order from 9% to mid-teens. So, and they're just firing all cylinders. So the margins were better than expected. Services on every count. And apparently the iPhone 17 is one of their best-selling phones. Yes, people were skeptical of this iPhone cycle, and yet it turned out to be the best-selling in all of Apple history.

And China International is doing well, too. So it's looking promising. And we'll see what the new CEO brings to the table, how he changes the position. But one of the important things, as we know, the big knock, was their delay in getting involved in AI. Right. You know, but they're promising that there will be an intelligent,

a personalized Siri, you know, by year-end. And I think they're smart. They're not having to invest in all this AI infrastructure spending. You know, they will just use existing ones out there. So I think it's a still looks good. What are the areas that you're concerned about if you had to be concerned about an area? I mean, is it semis? I mean, certain areas have really run up.

We've seen Intel a double in a month. I mean, it's just a crazy run. You don't own it. No. But you own adjacent names. I do. I do. And Intel's very interesting because Intel doubled.

in a month, right? And that, I think, is a function of people believe, okay, the turnaround story may actually happen. People thought this is AI structurally dead. But clearly there's some strategic interests in having chip manufacturing on shore. They're now manufacturing chips, et cetera, et cetera. But that, so that one I don't think I would touch here. I mean, I don't own it, you know, because it hasn't been a great name. But the AI, the one thing I'm not backing off is the AI infrastructure play and the AI hyperscalers, because I think what we're seeing where all the hyperscalers that announced this week, whether it was Amazon, Google, Alphabet, you know, Microsoft, they're increasing their cap-X and into 27 because that is how big the

demand is. I mean, you saw, I think it was Google was cloud revenue was up 63%. That's going to continue. So, and I think what's going to be interesting is next week we have the, you know, what I would call the real economy names. Yeah. Continued report and that's Eaton and Emerson. Yeah, and the Rockwell. And that's going to be interesting to see because their plays, you know, much on what's happening in the industrial side of things, which they're, obviously, AI is driving a lot of that. Yeah. So that, you know, that will be very telling, I think, in terms of what they report. So that's one thing I'm watching closely. Barbara, great to see you. Thank you. Thank you. Robert Doran.

All right, hold your horses. Up next, Y. You won't be able to bet on the Kentucky Derby on CalShe or any other prediction markets this weekend and what it could mean for that fast-scoring industry. And as we head to break, here are a few notable S&B500 stocks, setting 52-week lows today. Lul Lemon, tractor supply, Clorox, Abbott Labs, and ResMed. Closing Bell Overtime Live from the NASCAR market site. Be right back. Welcome back to overtime. The 152nd running of the Kentucky Derby is set for tomorrow,

but if you want to bet on the race, you won't be able to do it on the prediction markets. Contessa Brewer explains why. Well, that is because, Melissa, there are no event contracts on horse racing. It might seem odd given the vast number of options available on every other sport, but no Kentucky Derby event contracts. In fact, no horse racing.

it doesn't exist because horse racing is kind of its own little fiefdom. It enjoyed special legal status even before the Supreme Court decision that allowed states to legalize sports betting. By federal law, any platform that wants to offer wagers on horses has to get explicit permission from the host racetrack, from the horseman's group, which is made up of owners and trainers, and from the state Racing Commission, where the race is held. And of course, states insist that operators need explicit permission from their. them too, aka they need a gaming license to offer sports wagers. The prediction platforms, though, argue it's not sports gambling, but investing or trading or hedging or whatever they want to call it. And that is regulated by the Commodity Futures Trading Commission. The CFTC is now suing some states

for trying to enforce those laws. I did ask the CFTC, Polymarket, Kalshi, Fandul, Draft Kings, all to talk to me about shunning horse racing and event contracts. And either they didn't want to comment, They didn't get back to me, or they pointed me to other media coverage of this idea. What's interesting is when I talked to Bill Karsstand and the CEO of Churchill Downs, and I said to him, can you see this in the future? He's like, no, we don't want it to full stop. We don't think it's good for horse racing. It's not a model that works for us.

No, thanks. Are there any related bets, not on the race itself, but sort of, you know, ancillary bets around the race that are being put on these platforms? It's a great question. I mean, I looked for the broad category of horse racing. I looked for ancillary, like how much bourbon will be drunk. Right, right. The colored jersey.

You would think all of that. I could not find it, which does not mean it doesn't exist. But as I said, there are so many markets to wade through when you get there. And Kentucky itself is saying, uh-uh-uh. If you have a gaming license in Kentucky, they have a proposal on the books legislation pending before their state legislature that would say you cannot. offer predictions. So for a platform like Fandul, that could be a real problem. Yep. Contessa, fascinating. Thank you. Sure. Contessa Brewer. Let's get you set up with another massive week of

earnings starting with Palantier, Paramount, Skydance, Norwegian, Tyson Foods, and Pinterest on Monday. Tuesday features AMD, Pfizer, DuPont, PayPal, and Super Micro. Walt Disney, Uber, DoorDash, snap, and arm holdings are Wednesday's highlights. And Thursday brings McDonald's, Expedia, Coinbase, Lyft, Block, Affirm, and CoreWeave. And on the economic front will get factory orders on Monday, job openings and labor turnover survey, ISM services, new home sales on Tuesday, ADP employment report, and of course, the big one, the jobs report on Friday. So a big week ahead, buckle up. That does for us here on overtime. Fast money starts right after this quick break.