Closing Bell - Record closes for Dow, S&P 500; Broadcom earnings and the outlook for AI in 2026 12/11/25

Episode Date: December 11, 2025

Heath Terry, Citi’s Global Head of Technology and Communications Research, breaks down the latest OpenAI announcement and what it means for the AI landscape in 2026. Earnings from Broadcom, Costco, Lululemon and RH set the tone for the afternoon. Market gut check with Stephanie Guild, Chief Investment Officer at Robinhood. Christopher Rolland of Susquehanna analyzes Broadcom’s results. Diana Olick reports on U.S. home prices turning negative and Deepak Puri, Chief Investment Officer at Deutsche Bank Wealth Management, on his 2026 market outlook and the strengthening dollar. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Well, that's the end of regulation. Black Hills ringing the closing bell at the New York Stock Exchange. Park Dental doing the owners at the NASDAQ. A record day for the markets. The Dow soaring more than 600 points to a new record high. And as the S&P settles here, it looks like we got a record high there as well, 6901 potentially. So that is a fresh record close. The NASDAQ, however, falling as Oracle's earnings lead to a rotation out of the AI trade. Another record high for the Russell 2000, continuing its climb after Wednesday's Fed rate cut. 52-week highs for both the S&P midcaps and for the Dow transports as well. Tech and communication services, the worst performing sectors today. Materials, financials, health care, those are among the best performing sectors in the S&P.

We've got more on this rotation coming up. Material stocks getting a boost from precious metals. Another all-time high for silver. It's just been parabolic. Big moves lower, though, in energy. Crude oil off by 1%. That's despite some of the geopolitical tensions percolating in the Western Hemisphere off the coast of Venezuela. And take a look at that decline in that gas coming off after a big run in that commodity as well.

And that's the scorecard on Wall Street, but winter stay late. Welcome to closing bell overtime. I'm John Ford alongside Morgan Brennan. And it's another big earnings day here on overtime. Broadcom results out in just a few minutes. Will that news goose the AI sell off or propel broadcom into the $2 trillion dollar club? And we've also got some retail names that are due out. Costco, Lulu Lemon, R.H, they should give us a picture on different parts of consumer spending and different demographics within the consumer set.

Let's start, though, with Oracle had a big drop after its results in overtime. Yesterday, a decline that spread throughout tech. Let's get to Sima Modi with more. Seema. John, Oracle's encouraging cloud backlog and growing set of customers outlined in its second quarter report was overshadowed, right, by those renewed concerns around debt financing and a lack of detail provided by management on how it's going to fund. the data center buildout shares ending the day off the lows, but down about 11%. Neocloud names like Cornweave also trending lower, while Oracle's five-year credit default swap, spiking to a level not seen since 2009.

This tells us that investors are buying more protection. Morgan Stanley out with the notes they see spreads widening even further. So this is a chart to watch. Now, all of this leading to a further bifurcation in the AI trade when looking at the performance of hyper-scaler stocks, not just today by the. way, even over the past month, companies with stronger caste positions are outperforming for now. Oracle Chairman Larry Ellison last night did suggest Oracle will lean less on Nvidia chips and diversify its purchases while also leaning on renting GPUs as a way to reduce

its overall expenses. Worth noting Nvidia and other chip makers for the most part, ending lower Nvidia down by 1.5%. In general, it was a risk off day. We saw Bitcoin break up below 90,000, $91,000 and gold and silver trading, let's see, gold is higher. What did work, banks, health care after the Senate rejected extending subsidies. We saw United Health Care up over 2%. Morgan? Yeah, record high for financial sector as well. Sima Modi, thank you.

Now let's turn to the bond market, the day after the Fed decision. Rick Santelli is in Chicago for more on what we're seeing. Rick. Wow, what a wild day again in the Treasury complex, Morgan. Let's start out with continuing claims. They came out minus 99,000, but that's the week of 1129. See the chart there. Now, let's look at initial claims.

Initial claims are a week ahead, or I should say continuing claims are a week behind. So initial claims are the week of 12-6, ending 12-6. Now, look what happened. Last week had the potential distortion of Thanksgiving, and it came right out of the market because they're up 44,000, up 16 against expectations. And the down draft in continuing claims, most likely, is going to experience the same issue next week. Probably comes back a bit. Markets largely ignored it.

Look at a 12-hour chart of tens. We had a very little spike up at 8.30 Eastern. And remember, if claims really were going to stay down that low, it should spike higher. It has less fed easing, maybe no easing, if that was true, because of the labor market implications. And finally, let's look at a September 1st start for tenure. Why is this important? Because first of all, we're now unchanged on the session after the Fed cut yesterday, cumulative 175 basis points since September of 24. But maybe more notable, look at the right side of that chart.

Many say we're either at the top of the range or that is a Elliott wave pattern on the fourth wave, meaning yields are going to go up to around four and a quarter. We'll have to wait and see exactly how it turns out. John, back to you. We'll count on you to tell us. Rick, thank you. Now, the big theme of the day is AI. Oracle just posted its worst day since January after its earning spark concerns about its AI infrastructure spending and Open AI, unveiling GPT 5.2, its most advanced model yet, clearing up some glitches, fewer hallucinations. The company also got a $1 billion investment from Disney. Also allowing Disney characters in its SORA AI video generator, Disney moving higher on the news. What does all of this mean for AI and the markets in 20? 2026. Joining us now is Heath Terry. He is the global head of technology communications research at City. Heath, good to see you. Great to have you here on set. Thanks for having me, John. I don't know if I've ever seen anything like this where there's a private company at this scale

and valuation that's so influential over some of the biggest, oldest stalwarts in the market in tech and media and over the market itself. Have you? No, I mean, there's never been anything like this. I mean, people make comparisons to 1999. There is no comparison to be. to be made. This is this is uncharted territory. So is open AI sort of potentially a single point of failure in the sentiment in this market. Sometimes it gets circular. I don't think it is. You got money coming into open AI and you've got money going out of open AI. In this case, coming in from Disney, going out to Oracle questions about whether the product is going to be good enough to keep that sustained. How much is that going to influence what the valuations look like

in tech in the next year? Yeah, absolutely. I mean, we always talk about it as having an off-ramp, right? It's okay to have circular financing as long as there's a customer on the other side of it. And right now, the customers are companies like Citi and J.P. Morgan and Pfizer and Walmart and real companies that are adopting all of this, Disney today, that are finding value in AI. And the reference of sort of open AI is a single point of failure. This is not, you know, unlike a lot of other technologies that we've seen over time, this isn't a one-person, one-company sort of technology, right?

Google's doing a lot here, Microsoft, AWS at Amazon, all big companies that are participating in this. And the adoption of AI that's happening at the enterprise isn't dependent on any one of those companies' success. So if one company doesn't do what they thought they were going to do, there are three others that are going to pick up that slack. It's not going to slow down the pace of adoption at these big Fortune 500 companies. It's interesting to hear you say that. I mean, point blank, is corporate America actually finding value in AI yet? I mean, I think the answer has to be yes, right? You look at the pace of adoption that you're seeing and this acceleration in adoption that you're seeing. And that's something that shows up in the revenues of all the hypers, the backlog numbers that you're seeing there. There are real customers on the other side of it. And I think we're going into this phase as we get into January and you start seeing Q4 numbers, you're going to see this sort of productivity kind of creeping up, you know, whether it's revenue per employee, whether it's margins. As companies take advantage of the fact that they're going to see this sort of productivity kind of creeping up, you know, whether it's revenue per employee, whether it's margins. As companies take advantage of the fact that they, They are getting efficiencies out of this in code development, in customer service, in white-collar labor automation across really the forefront of things.

Financial services will be one of the, I think, first places that you see it, but you'll see it in health care. You'll see it in retail. You'll certainly see it in sort of energy and industrials where companies, not all companies, but most companies are really trying to adopt this to take advantage of it. So then looking at 2026, is that how the AI trade evolves? Is it to evolve beyond the hypers into enterprise AI? Yeah, I think so, right? We are slowly sort of working our way up the stack.

We've gone from chips to optical, to memory, to storage, to now the hyperscalers, and into some of the software layer, particularly at the data layer where you're seeing these consumption-driven models really benefit from all of this activity. So I think we're going to continue to do that as we go into 2026, but I also think you're going to start

to see this derivative trade, and to some degree you already are, this derivative trade of who are the beneficiaries, which companies are best at engaging in this, which airline is better than the other in terms of route optimization and predictive maintenance and all of the benefits that you can sort of get out of AI, which energy exploration company or oil field services company is doing that better? And I think a lot of portfolio managers will look for that kind of trade if they aren't already. That would be a dramatic development in the market because there are a lot of application software names that have actually been

been depressed on the AI trade, right? The idea that the open AIs, the Google, et cetera, are going to cannibalize them. If we're going to start to see them pick up on the idea that they're actually benefiting, is that what you're projected? Yeah, I didn't say that. So the application software guys are sort of in a different place. And that's one of the things that's been kind of disappointing about, particularly to a lot of investors, about the way that this is played out. The sort of horizontal applications within AI really having gotten a lot of traction, the co-pilots and all of the world, nearly as much so as these individual fit-for-function kind of applications that companies are building. So, you know, building

an agent within a bank to match up credit card transactions or handle ACH wires or, you know, K-Y-C-A-M-L compliance, that kind of thing, which very narrow, but it's built on the back of these APIs that drive token consumption, which drive revenues for the clouds. And so over time, I think maybe we do get into that application layer, but I don't think we're there yet. All right. Heath Terry, thank you. Got me excited for a minute there.

Sorry. Okay. But good to know, sober. Meantime, Lulu Lemon earnings are out. Courtney Reagan has details from the report. Court. Yeah, John, and before I give you the details from the report, I have to let you know that CEO, Kevin McDonald, will be stepping down from Lulu Lemon.

There is going to be an extensive search, but in the meantime, the current CFO and chief commercial officer will step in to run as effective co-CEOs until a permanent successor has been named. McDonald has been with the company since 2018. And of course, as we've talked about extensively, the company has struggled the share price about half of what it was so far a year to date. So kind of interesting upside move on both perhaps that announcement and leadership change, but also the earnings, which have been stronger than expected, coming in at $2.59 for the third quarter, better than analyst's expectations of 225 on stronger than expected revenues at $2.57 billion. The street was looking for $2.48 billion. That's an increase of

about 7% over last year. Same store sales coming in as expected total up 1%. However, America's comparable sales down 5%. So really was international that sort of lifted that up. Gross margin did come in better than expected, which is somewhat of the surprise because of the reports discounting that had really driven some of that store traffic over the Black Friday weekend, gross margin at 55.6% compared to 54.3% expected. There is also a billion dollar increase in its buyback program. And then when you were looking at the guidance, the guidance also a little bit weak here for the fourth and final quarter of the year. Earnings expected to come in at 4.66 compared to 4.66 to 4.76 compared to 5.03.

And fourth quarter revenue is also a bit shy of expectations in a range of $3.5 billion to $3.59 billion. The street was looking for that to be at $3.6 billion. So stock price moving around, but it is higher right now, John, and a lot of things for the street to digest. Back over to you. I'll actually take it. Courtney Reagan, thank you. Those shares are now up 6%. Well, coming up, we are still waiting for earnings from Broadcom, also Costco.

We're going to bring you those numbers as soon as they cross. And a big rotation in the markets today. The big stocks in the down, the little ones in the Russell, 2000. sorting the record highs while the tech-heavy Nasdaq closes lower. Our next guest expects this to continue. She'll make her case ahead when overtime comes right back. Welcome back to overtime. Markets powering higher today.

Record closes for the Dow, the S&P 500, and the Russell-2000. 52-week high for the Dow transports. Let's talk more about these record-breaking markets as we had in 2026. Joining us now right here on set is Stephanie Gild. She is Chief Investment Officer at Robin Hood. It's great to have you. Welcome. Thanks for having me.

All right. Stocks at record highs. What do you think? Well, I'm a little worried about the S&P 500 from here. I do see it going up a little into 2026, but not by as much. I actually think more of the action is going to be below the largest names. And we've started reflecting that in Robin Hood Strategies, which is the portfolios we manage. If you look at, like, since October 29th, the top 100 stocks performing this year, you know, perform return-wise, only 41 of them, or actually 41 of them, I should say, have a negative return since October 29th.

And they haven't really rallied back since we had that pullback. So I actually think that's when the rotation really started. And that's when I think, like, we started owning, we've had things like regional banks, for example, consumer names is really like the other thing that we're. starting to like as well. Interesting. Well, we've got Broadcom earnings are out. We're going through those results right now. We'll bring them to you momentarily. In the meantime, it does feel like investors have been focused on two things and only two things. And that's been the Fed and AI. And of course, we're waiting for the next read on AI with Broadcom right now. This idea of a rotation and a broadening out of the market, what's propelling that? And as we do see the shift

out of AI, does it have legs here? I think it does because you have the Fed that just cut and they're going to, I think they'll cut again in January. I know that's a low odd right now. I do agree with them that it will probably be at three and a half percent. I think the bond market is actually telling you that it's going to get to three and a half percent because you can see that in the curve. And I think that's going to help consumers somewhat. Obviously, the Fed is also starting to buy treasuries, although on the short end. But I also think like all year long we've been investing alongside or at least in alignment with fiscal policy. And I actually think 2026 is going to be a fiscal focus on the everyday person on the consumer because you do have midterm elections coming.

And so I think there's going to be a reason for people to start to feel better, actually, about their economic, you know, how they feel about it in general. And I think that's going to help retailers a little bit. And they're all down a lot. So they're all really attractive from evaluation perspective, too. Stephanie, fair warning. I might have to interrupt you when we're ready with Bron. Com numbers. Initially, yeah, the stock is up three and a half, four percent. So the news can't be bad, I guess, at least initially. But I wonder what had the market down, at least the NASDAQ down today from Oracle's questions about the demand? Is it really going to come through from Open AI? More than half of it is supposed to come from there. And how that's going to be financed. There we go. Broadcom earnings. We're ready with them. Christina Parks and Nevelis. What are the details? So we are seeing a beat across the board.

Let's start with the EPS earnings per share, $1.95 on revenues of $18.02 billion, higher than the street anticipated. Same thing for Q1 revenue guidance coming in slightly higher, $19.1 billion. The company is attributing a lot of that strength specifically to AI semiconductor revenue. They're saying it's increasing a 74% year-over-year. But one really important metric is AI revenue. Specifically AI revenue, they guided for $6.2 billion for the quarter. they actually hit 8.2, so much higher than what they promised they would hit last quarter. And this is important, too, because it is tied to Hawk Tan, the CEO.

His expensive pay package is tied to various tiers of selling AI revenue. So I think that's adding to the stock increase of about 3%. Semiconductor revenue, higher, $11 billion. Infrastructure revenue, higher, $6.9 billion. So across the board, so far it's a beat versus estimates. And it seems to be a beat off of some by side expectations, too. So that's probably driving a little bit of that uptick in the stock right now, guys. Christina, thank you.

Great fodder for the conversation. Okay, now, so Stephanie, now that we know this, is the good news here from Broadcom, mainly good for Broadcom or how much is it good for the overall AI trade counterbalancing some of the questions out of Oracle? Yeah, I think when you think about Broadcom, like where their focus has been in my mind, Like, that actually pushes the positive part of the narrative, which has been that there's a diversification of leaders. It's no longer just an NVIDIA play. And I think, you know, Google has been a place that we have played that, and you've seen that do really well.

And I think that's going to start to broaden. So our view is that AI starts to creep into the broader economy. People start to use it more. And it's no longer about, like, the hardware or the models. It's more about, like, the actual improvement in efficiency. And that's where I think, like, Broadcom can be a good player because it creates some competition in the chip space. But also, I think it shows that I just think it's turning to a new phase. And that's why, for example, we added to Microsoft recently because we think that's actually going to benefit a little bit more now.

Interesting. All right. Stephanie Gilt, thank you. So rotation across the market and rotation within the AI ecosystem, potentially, too. Exactly. All right. Well, Costco earnings are out. And Courtney Reagan has those numbers for us.

Hi, Corr. Hi, Morgan. So this is Costco's fiscal first quarter. They're turning in earnings per share, $4.50. That is better than expectations for $4.27. Revenues also stronger than expected. This is total revenue, so inclusive of membership fees, $67.307 billion. The street was looking for $67.137 billion. Comp sales. We know we still get these from Costco regularly, but total for the quarter, up 6.4%. Digital-inabled sales, up 20.5%. The company, did recently change how they're reporting that number. So it's going to be a little different comparison if you want to look back to previous quarters. But just to know now it is digitally enabled sales increased by 20.5%. And the membership fees that were inclusive in that total number did grow 14% year over year. Right now, shares down just a little bit for Costco. Back over to you. All right. Courtney Reagan, thank you. In meantime, the S&P 500 financials sector setting an all-time high, Visa, a big contributor to that record and to the Dow.

We've got more on its jump coming up. Speaking of financials and the Dow, Goldman Sachs extending its winning streak to eight sessions. It's up about 12% over that time period. Mike Santoli is digging deeper into this market rotation. We've got so much more when overtime returns. Welcome back to overtime. Shares of Visa jumping, helping to push the Dow to an all-time high. Bank of America upgrading the stock to buy from neutral.

saying stable coins are an opportunity, not a threat. And adding that in the six months since the Genius Act passed, regulating stable coins, Visa has dramatically underperformed the S&P 500, making its valuation attractive. Bank of America also downgrading PayPal, saying its efforts to increase growth are taking longer than expected. Well, Wall Street's flashing new risk-on signals as money starts to aggressively move into pro-cyclical and risk-on names.

So what's driving the turn? senior markets commentator, Mike Santoli, might have some ideas. And Mike, it's not some of the risky names we've been talking about earlier in the year. Yeah, so it's certainly not risky in the same way, right? It's older economy, reflation, reacceleration of the economy seems like the impulse that has been animating markets in the last little while. Now, this is one way to illustrate it. This is the real pure value subset of the S&P 500, like the undistilled essence of cheapness

in stocks. That's what it's supposed to measure. Anyway, it is now overtaken on a unit-date basis, real pure growth, which is really much more expensive. Tech-focused, it's obviously the NVIDIAs and broadcoms and Palantiers running that index. This is much more things like autos, a lot of commodity-based and financial stocks in there. So that is definitely a sign of a kind of a rotation, more of a risk-on for cyclicals, not risk-on-for-speculation. Here's another way to look at it, maybe a little more of a nuanced message. Gold, relative to shares of Goldman Sachs.

Goldman Sachs is just on an absolute tear. You see this sort of catch-up move toward gold prices. Obviously, these are not purely inverse because they're both up a lot in the year, but they're driven by different, I guess, animating forces. Gold seems to be about the world looking for alternatives to traditional financial assets at a time of lots of government debt and some de-globalization. Goldman Sachs is just an absolute direct leverage play on capital markets activity and financial assets doing well. Also, it's getting a little expensive. as a stock relative to its own history, two and a half times book value. Haven't seen that since 2007, Morgan.

You know, we're just having this conversation with Stephanie Gild about, especially looking at 2026, you know, what sort of propelling this broadening out in the market? One of the things she touched on was fiscal policy. When I look at some of these charts and some of the notes as we set up for 2026, you have to think that is playing out here in some of the moves. It absolutely is. Everybody is front-running this, and it's been pretty well telegraphed. there have been these policies in place to run the economy hot in 2026. It's all about the tax

withholding schedule. A lot of things are working in that direction. Now, whether we get it or whether it does manifest in the stock market in the same way, we never really know in advance you could have said, and people were saying it exactly this time last year, growth-friendly policies in 2025 are going to mean you should be in cyclicals and basically equal-weighted S&P. It's working right now, it didn't work most of the time between then and now, though. Yeah? Better late than ever? Well, we'll see. All right, Mike, thanks. Now it's time for a CNBC News update with Bertha Coombs. Bertha. John, the 22-year-old Utah man accused of killing conservative activist Charlie Kirk earlier this year made his first appearance in court

today. Tyler Robinson is charged with aggravated murder and felony use of a firearm among other charges. He's not yet entered his plea. The judge in today's hearing is weighing media access to his prosecution. His attorneys expressed concerns that too much attention could interfere with his right to a fair trial. A FEMA Review Council meeting was abruptly canceled today, according to NBC News. It was supposed to be a rollout of recommendations to the future of the government agency that coordinates federal response. to disasters. The Department of Homeland Security referred questions about the cancellation to the White House. And Indiana state senators are poised to vote any moment now on a new

congressional map that could give Republicans control of all nine of Indiana's house seats, up from the seven they currently hold. The Republican Chamber has been under pressure from the White House to approve the rare mid-cycle redistricting. John? All right. Bertha Coombs, thank you. We got some breaking news from the Federal Reserve. The Board of Governors has voted unanimously to reappoint the Regional Bank Presidents for five-year terms beginning on March 1, 2026. Typically, it's a routine vote, but there had been speculation about whether the administration would try to influence the reappointment process, but today's announcement was unanimous, meaning even Stephen Myron, on loan from the administration, was in favor of these appointments. Coming up, we will check the stocks making big moves here in overtime, including Broadcom,

which is up a solid 3.5-ish percent after a strong earnings report and guide analyst reaction to Broadcom's report coming after this short break. Welcome back. A big day for the markets. The Dow, the S&P, and the Russell 2000 all closing at record highs. The NASDAQ, however, closing lower, led lower by, Oracle, but money moving into other areas of the market. Dow transports, the S&P mid-cap 400 index, both hitting 52-week highs, but not quite new records. Lulu Lemon is a big mover right here in overtime. It's now 10.5%. CEO Calvin McDonald is resigning. As far as the results, earnings and revenue both better than expected, but fourth quarter guidance is a touch below

current consensus. Costco, also out. earnings were better than expected. A total revenue of more the $67 billion in the quarter. That was a tiny bit ahead of the forecast. Costco saying the top categories during the quarter were pharmacy, gold and jewelry, perhaps not surprisingly, and tires. Yeah, and meantime, shares of Broadcom are popping here in overtime, up about 3% after posting a beat across the board. The company also saying it expects AI semiconductor revenue to double year over year

and expects current quarter revenue's outlook to be above estimates. and joining us now is Christopher Rolland from Susquehanna. Christopher, welcome. So last quarter, Hocktan was telling investors that the XPU business, the AI accelerators did so well, in part

because these three major customers were doing better than expected, but also a fourth customer. What's your take on the outperformance of the business in this quarter and what that might say about that continued momentum? Yeah, we're going to have to wait

for a few more details for the conference call. Hawk Tan is famous for dropping some pretty major bombs. Last quarter was this fourth customer. But so far from this report, what we can see is AI revenue beat, and the guide in particular looks about 700 million better than we were expecting. So we think this is probably related at this point, mostly to Google and TPU. Our checks have been there, had been really, really strong there, pointing to upside. And so I think there's some pull-in and some up siding of orders coming from Google for TPU.

Christopher, given that, does this serve as a counter-narrative in the overall AI trade to the concerns from Oracle from overtime yesterday? Or is this just broadcom flexing a bit, perhaps that fourth customer showing that it can pick up some share? Yeah, that's a really good point that you make. Oracle is really centered around GPU and we'll be moving into XPU, but not Google TPU. And so I think this report, by the time we unpack it all, is really going to point to upside in Google's TPU in particular. And all of those TPUs today, eventually Media Tech will be working in, but all of those today are Broadcom. What do you think of the valuation here? I mean, it's had a pretty strong year.

Just earlier on the show, we were talking about this rotation within the broader AI ecosystem right now. Yeah, the valuation, if you look even just 12 months out, is stretched. But if you go out to 2027 and we think that you should, given these new customers that are going to be piling on here, we're probably in the high 20s. And I think that's much more reasonable for a growth stock like that. and we'll see if they can put a few more customers on top of that. Okay, Christopher Rolland. Thank you for joining us with shares of Broadcom up about 3.5% right now. Well, up next, House of Poirers.

We will look at why home prices just went negative for the first time in two years. Why that could last a while. Plus, the U.S. dollar having one of its biggest yearly declines in decades. But coming up, Deutsche Bank Wealth Management's chief investment officer will explain why investors should bet on the green back, striking back, in 20. 26. We'll be right back. Welcome back to overtime. And check now on Earth Imaging and Analytics Company, Planet Labs, which led the Russell

2000 to that record high today. Planet closing up 35 percent today. That's after a beaten raise quarter, as well as the fact that it's in the news with its satellite image of the Venezuelan tanker seized by the U.S. yesterday. Well, I spoke with Planet Labs co-founder and CEO Will Marshall about the power of AI coupled with the power of Earth data. We had this conversation before earnings. So last weekend, also about speculation, as speculation, I should say swirls, about SpaceX's valuation and a possible IPO, the prospect of data centers in space.

As launch costs come down, satellite costs come down, at some point it's obvious that the economics make more sense to compute in space. And actually, you know, Google and others are running out of filing places that are suitable on the earth, that have the right resources. and space literally for them. Space has a lot of space, and you get eight times the power because your solar panels can be in sun all the time and various other things. You have free cooling to the background of space. So there's some fundamental technical advantages.

It's just about the launch costs and the satellite cost. Well, Planet works with NVIDIA to use its chips for edge computing in space. More recently, it announced a project with Google to fly TPUs in space, and it isn't just planet that's shooting higher. Other commercial space docks are on the move as well, not only today, but this week overall, including Rocket Lab, Firefly Aerospace, Intuitive Machines, AST Space Mobile, even Echo Star, which is seen as tied to SpaceX, especially if it does IPO, given its big spectrum sales to Elon Musk's company. But for more and specifically more in this conversation around Planet Labs, CnBC.com, and to my podcast, Manifest Space,

check them out. Check them out. Well, we've got some news you can use if you're trying to sell your home, maybe if you're trying to buy. Prices just turned negative on a national level for the first time since 2023, and it could be some time before that reverses. Diana Oleg, I'm not sure how much that's a big deal versus the inventory situation and days on market, but I think you know. Well, guess what, John, they're all interconnected. Look, prices are now just fractionally lower than they were one year ago, according to data from parcel labs, which looks at single family homes, condos, townhomes, both new and existing. Home prices are down 1.4% in the last three months.

So why is this important? Well, we have not seen home prices nationally go negative since mid-20203, about a year after the Fed first brought rates up from zero, and mortgage rates spiked higher. Even then, though, prices were negative very, very briefly. Before that, prices hadn't gone negative since the great financial crisis when they basically crashed and it took them, you know, six years to start coming back. certain markets are seeing significant drops, Austin, Denver, Tampa, Houston, Atlanta, and even Miami. But some are still gaining, like Cleveland, Chicago, New York City, Philly, Pittsburgh, and Boston.

Now, Parcel's co-founder Jason Luris said, our base case from here is not a deep national downturn, but a period where prices hover around zero with small positive or small negative year-over-year changes. But of course, it's going to depend on mortgage rates and the broader health of the economy. And then there's supply from the builders. That is going to have a big effect on prices. But unfortunately, we still don't have any data on that since before the government shut down because they still haven't gotten to it yet. Guys, back to you. Diana, this is fascinating to me because traditionally you see rate hikes, which pushes mortgage rates up, which then pushes home prices lower.

That's not what we saw as you just laid out. And now we have rates coming off and maybe more potentially inventory. And I know we're waiting at some of this data coming online here. Have we ever seen a housing cycle quite like this before? I mean, I haven't seen one like this before. And as you know, I've been doing this a little while now. What's interesting is we're seeing a lot of delistings. In fact, the highest level that we've seen in many years,

and that is sellers pulling their homes off the market because nobody wants to catch a falling knife. You don't want to see home prices going down around you and be in that market. So the question is, do they take it off now and wait until the spring thinking that maybe mortgage rates, even if they're not much lower, people will get more used to where they are right now because they really haven't moved much at all in the last four months. And then they could start to see more competition and prices go up.

Because, again, while we do have a little bit more inventory than we did last year, we are still well below normal levels. All right. Diana Oleg, thank you. Up next, Bowles on parade. Deutsche Bank Wealth Management's chief investment officer is going to tell us why he thinks the S&P 500 could rally another 10% next year. And the fast money team is busy getting ready for their trading the holidays event. That's a live shot right there.

you on the screen. It kicks off at 5 p.m. Eastern. Tune in tonight for the big show, special guests, live audience questions, a few more festive surprises. It all stops, starts at the top of the hour, only on CNBC. From back, Deutsche Bank is out with its 2026 market outlook, seeing the S&P 500 headed to 7,500 price target by year end, betting on the U.S. to slightly outperform international stocks and the dollar to rise again. Joining us now is Deutsche Bank wealth management, CIO, Deepak Puri, right here on set. Welcome. Thank you. So dollar had a big year to the downside this year. You think it comes back next year. Why? It's not necessarily a very strong dollar call, but we do think there's going to be a level of stabilization. You're not going to

see this weakness that we saw, especially in the first half of this year. And if you look, the dollar started to stabilize in the second half, since this Mar-a-Lago accord related, you know, concerns that people had. I mean, there was a concern that the incoming administration really wanted a weak dollar just to make sure that the trade deficits gets rectified and our exports become more competitive. I think now the narrative has changed, especially with the Fed now saying that we're not going to be cutting as many cuts going into 2026 as what the street was initially expecting. So I think when you look at the strength of the economy, which tends to be a good precursor to the underlying currency strength, when you look at the fact that the

Equity markets are generating double-digit returns again this year. That should attract a lot of fund flows. When you look at all these things together, it's hard to make the narrative that the dollar is going to decline as much as we saw this year. And if you were to zoom out a bit, yes, dollar had a pretty weak 2025, but we're still up 7% since 2021. And on an annualized basis, around 2%. So I'm not too, you know, our outlook is that, again, some emerging market currencies,

you might see a little bit of a dollar weakness, But your dollar at $1.15 and dollar yen at $1.45 is our 12-month outlook. On a day where we're getting reports that there could be more seizures of more Venezuelan tankers, how does geopolitics factor into this market here? Or is it calming down looking at 2026? Actually, you know, I mean, obviously at any given time, geopolitics can flare up and play a role, especially when you're talking about oil, which is a political commodity. So you want to keep an eye on it.

one of our themes. But having said that, I think we are entering 2026 that probably a better, you know, geopolitically than maybe 2025, where we had a new administration coming in and a lot of elections, you know, from the rest of the world, that there was this Middle Eastern crisis, which seems, at least for the time being in the rear view. So I think the geopolitics may end up being a little bit more subdued in 2026 than it was in 2025. Speaking of politics, maybe a little bit of a wildcard, Some of your positivity around the dollar and maybe the overall U.S. market has to do, it sounds like, with the Trump administration and GOP policies. But right about summer, we're going to start to get some post-primary midterm polling.

Will that affect the market sentiment? John, I mean, the midterm election year tends to have a very sort of peculiar market narrative. The first quarter and the fourth quarter of the year tends to be really positive. But there is a definite summer lull. You know, it's the second and third quarter. right before the elections, market tends to be sideways and slightly negative. And I would not be surprised if that's the sort of course the market takes, then you tend to get a relief rally post the elections.

What could be a little bit more decisive this time around is the fact that we are having, you know, the one big, beautiful bill, a lot of these tax incentives that are going to hit. You're looking at a 20% euro-over-year increase in tax refunds in the first half of the year. That could spur some additional, you know, spending and animal spirits in the market. market? Are the stakes higher for that middle period and for the market overall, given how muscular the executive has been this time around? And given the fact that the GOP has had both houses of Congress and the presidency in order to get these policies through? Absolutely. I mean, the bar is pretty high. And, you know, the market needs to see a lot more than what they have

seen so far from the GOP, from the administration, especially, you know, if you think about this case-shaped economy narrative that's been going on, right? So, for the market, it's for the market. the bottom half of the households, what is being done. And I think as we get closer to the midterm, you know, I think there's going to be more of that effort to really make sure that there is this consumer spending, you know, that's building up, not just the GDP is a CAPEX story, which has been the case, right? If you look at why the GDP is done so well and, again, going back to our outlook, that is primarily being driven by the non-resi, you know, fixed asset investment slash AI data

center is being built and contributing a lot. You really need to see the biggest component of the GDP, which is the consumer, needs to start firing, if not on all cylinders, at least on most cylinders. Okay. Deepakpore, thank you for joining us. Thank you so much. Well, RH earnings are out. Missing on earnings in line for revenue at $884 million.

But saying fourth quarter sales are expected to come in short of the current estimate, company CEO, Gary Friedman, outspoken, as always, in his shareholder letter that accompanies earnings, saying we are in the third year of the worst housing. market we've seen in almost 50 years, also pointing out the risks from tariffs, saying over the past 10 months, there have been 16 different tariff announcements leading to product delays and shortages, price negotiations, and increases. But you can see right there in terms of price negotiations, shares of RH are actually bouncing right now, up about one and a half percent here in overtime. Well, up next, Mike Santoli looks at why annual seasonal patterns

and the midterm elections could be flashing a warning sign for the markets. Welcome back to overtime. It is that time again. The Ned Davis Cycle Composite for 2026 is out, blending seasonal election and decadal trends. It's not a forecast, but the roadmap has hinted at key inflection points in the past. Mike Santoli is back. Mike, is this predicting markets like the farmer's almanac predicts the weather? It might be a little bit like that, John, although at least it's transparent in terms of what it's exactly. using to try and create this potential template for next year. So yeah, maybe not everybody's been anticipating this. I always like to look at it. It's more of a conversation starter and an expectations setter. So what is it actually? So there's an annual seasonal pattern that we're probably familiar with year-end rallies, a little bit of a setback maybe toward the middle of the year of the fall. And that's overlaid with the four-year election cycle pattern, as well as that decadal

pattern, which basically means years ending in six, and how they have tended to perform. So the levels you'll notice show subpar returns in general. That's mostly because of the midterm election. In fact, there's been some big down years in midterm elections, including the last two, and that maybe has swayed the averages. So strong start, really nothing at all from the spring into the actual election would be the strict pattern, and then a strong finish to the year once we get through the election. So it won't be like that precisely, I can guarantee it, but it does tell you that if in fact

we do just tread water or have some downside chop in the summer, there's nothing out of the ordinary about that. And if we just rip higher through the summer, it's saying, hey, maybe this market is stronger than we otherwise even thought it was. So all those things into the mix. And by the Ned Davis, I think, is one of the foremost chroniclers of market patterns and signals and a lot of the actual hard data for how behavior has manifest in the past in markets. Nice. I see that Q2 and Q3 thing that Deepak was just talking about as well. So I'll throw at you, what I threw at him, and that's the question, given how muscular this executive has been in the White House and given the fact that both houses of Congress have gone to the GOP

and that they focus so much on economic policy and even the stock market. Is there more at stake, perhaps, this cycle? I think there's plenty at stake. I do think that there has been a very concentrated focus on having policy leverage kind of project into the economy ahead of that midterm election cycle. So I guess so. You could argue that maybe there is a little bit more at stake in terms of potentially getting a bit of an offset through next year's elections relative to what we've had, you know, the sort of triple play into this year. So could be, I think other forces matter a whole lot. None of it says nothing about, you know, AI and secular trends and all the rest of it. But, you know, all worth throwing into the mix as we

get into year end. All right. Mike Santoli, thank you. The Morgan, keeping my eye here on Broadcom, which is a big name reporting here in overtime today, still up about 3%. But I'm also checking a few other AI names. Dell fractionally higher only. I wonder if this really has influence on the overall trade. Yeah, we'll have to see. We got Fed speak tomorrow. Also keep an eye on the Supreme Court because we could get AIPA tariff decisions as well, and that's been flying under the radar here. That does it for us here at overtime. Fast money starts now live.