Power Lunch - Apple unveils new products; Takeaways from Gastech 2025 9/9/25

Episode Date: September 9, 2025

Apple rolls out a new, thin iPhone, among other new products. Morgan Stanley CEO Ted Pick gives his read on the economy. And our Brian Sullivan brings us interviews with Secretary of the Interior Doug Burgum and U.S. Ambassador to Italy and San Marino Tilman Fertitta from Gastech 2025. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

And welcome to Power Lunch. I'm Dominic Jew and for Brian Sullivan today. We've got a big show in store for you. Starting with Apple, Tim Cook launching new hardware that's promised to be awe-dropping, including the latest iPhone 17 series. The stock is a big laggard among the Mag 7 so far this year. So can the new tech boost sales and investor optimism? We're going to have more on that in just one moment. Plus, we'll hear from the CEO of one of the most important investment firms in the world. Morgan Stanley's Ted Pick will join us for an exclusive interview on his take for the markets, the Fed, and much more. And oil prices are up on geopolitical turmoil. Our own Brian Sullivan will join us live from a major energy conference in Milan, Italy,

where he is sitting down with top leaders in the space. That is all coming up very shortly. We begin, though, with Apple. The company's annual product launch event is finishing up, and shares are on the move. You can see they're down about one half of 1%. investors are reacting to the latest lineup announcement. Our own Steve Kovac is live in Cupertino to break all things down for us from this big event. Steve.

Hey there, Dom, and you'll forgive me. I got one eye on the event because we are still awaiting pricing. So let me start with the iPhones, though. That is, of course, the star of the show. And within that is the iPhone Air, a brand new model, that super thin model we've been hearing about for the last several months. This is an interesting device here because it takes a lot of the guts. and internal stuff like chips and performance that we'd see in the more expensive pro lines and kind of squeezes it into this super thin package. Apple says it's the thinest phone they've ever

made. And by the way, it has this, like I said, that same chip, that new A19 Pro chip that's also in the pro devices. Apple says it's just as powerful as a MacBook Pro. So a MacBook Pro in your pocket there. Another interesting thing here on the internal components are the Wi-Fi, Bluetooth, and 5G chips. So Apple is using its... its own chips instead of partners like Broadcom and Qualcomm for that. We should expect to see that trend bleed into other models in the years to come. Beyond that, there's the regular iPhone 17, not much to go over there. Incremental upgrades on camera, battery life and screen.

Same thing with the pros, a slightly new design on these new iPhone 17 pros. It comes in what they call a cosmic orange color. And then of course all those basic things that you'd expect are improving as well. On top of that, we got some new accessories, the new Apple Watch Series 11, which has a 5G connection and high blood pressure notifications for the first time. And then the AirPods Pro 3, the third generation of those AirPods Pro, two interesting things here. One is a heart rate sensor built into those that you can track your heart rate during workouts, taking some of those features from the Apple Watch, and then live translation.

So if you have your AirPods in and you're talking to someone who speaks in a different language, you can talk to each other and the AirPods will automatically translate them. We've seen that from META and Google on their products, but the AirPods are a much higher volume product. So this is going to be interesting to see how that works in the wild. Events just wrapping up, Dom, I'm expecting pricing, which there's been so much chatter

about raising the prices on these iPhones in response to tariffs and so many other factors facing this company. So we should have that for you in a few moments. Right now, they're just wrapping up the final details on this pro phones. I'll be back with you in just a few minutes, Dom. All right, I'm sure you will be watching

all things from the event, including that pricing overall, Steve will check back with you later on this afternoon. Now, we've got the live movement here, the live event going on right now. So if you take a look at what's happening with this particular move, that's going to be one to keep a close eye on. So as we watch what's happening, now let's get an analyst's perspective on Apple's latest move in the product announcements here. Joining us now with that take is Daniel Newman, CEO of the Futurum Group and chief analyst at Futurum Research. Daniel, you heard the Steve report, Kovac report there on what's going to happen. This is, again, maybe not revolutionary in many regards, but it does take a step forward

in terms of the hardware and the design. Is it going to be enough? This is the bread and butter for Apple. Is it going to be enough to get people excited about Apple stock again? Hey, good to be with you, Dom. This is a really tough moment for Apple because the company's got this difficult headwind that people want to hear more, see more about AI, waiting. to hear a bit more about Apple Intelligence. Having said that, I'm watching everything be announced in

real time. I think some of the things the company is doing incrementally with their AirPods, with the new watch, with this really thin phone, it looks great. But to your question about investors, right now, I think the problem with Apple is that everything that's showing up today is, in fact, pretty incremental. Yes, the phone is thinner, and yes, it looks great. We haven't had a big super cycle in four years. We were sort of told that, hey, Apple Intelligence last year was going to drive this big cycle. It didn't really accomplish that. Now we've got the thinnest phone ever, longest battery. Does that drive a super cycle? And of course, we're waiting for price because we want to know, do these phones, slightly longer battery, slightly nicer screen, maybe a bit more durable. Are people

going to run out and buy them? And if they're going to charge more, if tariffs are going to start to impact, that may be a problem too. So I think it's a tough position. The announcements have been good, But I think with everything Nvidia is doing and everything Google is doing right now, it's hard for that investor to say I want to put a dollar here into Apple. Nvidia, Google slash alphabet. The one thing those two have in common, of course, are a bigger tilt these days towards artificial intelligence. I remember the Apple intelligence feature was supposed to kick off a possible super cycle for iPhones. It did not happen with this past generation of iPhone. So is it the artificial intelligence aspect that is going to be key to Apple's future with regard to its integration of those AI tools into the hardware in millions and millions of hands across the world?

Yeah, the beauty, and I've continued to say that Apple has the longest enramp to get AI right because it does have this multibillion unit install user base that it can access and that it can tap into. It's partnering with OpenAI. It's partnering with Google. I think because of this size of this shift, you're seeing these other companies across the Mag 7 and others like Broadcom, just getting these huge runs up because of what is happening in the data center. And of course, this AI, you know, this AI boom is driving all of this additional investment interest. You know, yesterday Nebius and Microsoft partner, and you see a company like Nebius jumped 40%. And you got Apple investors traditionally a little safer, a little bit longer horizon, not as much worry about capital risk. But at the same time, they're going, All these other companies have had these parabolic moves. Apple's supposed to be doing more AI. And now you've got people like myself for six months calling, you know, maybe it's perplexity. Maybe they should be investing and acquiring a company like Mistral. But they're using AI and their devices and they have for a long time and they've done that really well, Dom.

But I just can't figure out for that investor group. What is enticing here? It's got to be that, you know, that install user base. But where does that growth come from? You're talking single-digit growth, and you're talking, you have not seen any of these new features create that super cycle that's going to, you know, really make investors flock back to Apple. This is also a situation where there are too many questions right now that have yet to be answered from the Apple side of things with regard to that entire kind of tech, hardware, software, AI ecosystem. But there are other places within technology that have been considered more perhaps surefire in terms of their, attachment, their tangency to AI or maybe direct AI exposure overall, are there better places

within that tech world other than Apple where people feel as though there can be a higher probability of success with regard to the investor dynamic? There are some really obvious names right now. I mean, we've seen Nvidia has had a significant pullback. And yet we're seeing some really positive news about Nvidia. Just this week, we heard that some of these licenses to China are going to enable it to ship its age 20s. We know that it has its next generation blackwall that could go into China. We know we continue to hear about this insatiable demand for compute. I mentioned the Nebius Microsoft deal yesterday.

They came out at over $17 billion that Microsoft is investing into capacity. These companies are looking for more compute that they can get immediate access to to to continue to grow their AI presence. So yeah, the opportunity sits right in front of us. I was pounding the table dom for a number of quarters about Broadcom and Avago stock because I see what's going on in the custom chip space. And now we got that OpenAI announcement. We've got companies, you know, maybe Apple's taking some of those Broadcom chips away from their

new iPhone air. But you've got companies like OpenAI that are saying, we're going to spend $10 billion on custom chips. And then, of course, they're already spending, Google is already spending billions with Broadcom as well. Now, that stocks run a little bit. But this is just getting started. we have a $583 billion data center, Tam, by 2029, just for the chips and networking.

So, like I said, Apple is doing well. It's doing incrementally nice things for these devices. And I think consumers are going to get excited about this. But I just don't know if it's enough to really move the share price and get investors that want exposure to AI to say that this is where I'm going to go. It might maintain its kind of safety profile, though, because we know that install base is big, and we know the users are going to stick with Apple. All right. Daniel Newman of the Futurum Group with the latest there on the Apple product launch. Thank you very much.

We'll see you again soon. Coming up on this show, the best of the banks, Morgan Stanley is the best performing financial name in the S&P 500 so far this year. Chairman and CEO, Ted Pick, joins us for an exclusive interview from the bank's global health care conference. Ted Pick, Morgan Stanley, coming up next. Keep it right here. Welcome back to Power Lynch. Let's head back out to Steve Kovac in Cooper Tino, California, with more on the pricing for the new iPhone. Steve.

Yeah, Dom, no major price increases here, but there is one model that did go up by $100. That would be the iPhone 17 Pro. It's now starting at $1,099. That's up from $999 for the same model or the comparable model a year ago. But the Pro Max, the same thing with the bigger screen. That's starting at $11.99 just like before. The Air, the iPhone Air, I told you about at the beginning of the hour, that is starting at $9.99. That's what the pro used to cost last year.

and it's $100 bucks more than the plus model that it's replacing. But of course, Apple could argue this is a brand new kind of phone. Therefore, we're not actually increasing prices. It's just a new device model. And the iPhone 17, the base model, is staying the same price starting at $7.99. These devices are going to go on sale next week on the 19th, Friday the 19th, and you'll be able to pre-order them this Friday, Dom. All right, Steve Kovac, with latest on the pricing for those new iPhones.

Thank you very much for that. Meanwhile, one of the best financial stocks in the S&P 500 so far this year has been Morgan Stanley. Those shares are up more than 20% this year, hitting a new record intraday high in trading today. Our Leslie Picker is at Morgan Stanley's Global Healthcare Conference in New York City with an exclusive interview with Chairman and CEO, Ted Pick. Leslie. Hey, Dom, thank you and thank you, Ted, for being here and doing this with us. My namesake. Pick and Picker.

Fantastic to have you. The United. So here we are at your healthcare conference. I know you've been talking with customers, both on the corporate side as well as the investment management side. Do you get the sense from them that a slowdown is coming? I get the sense that we are busy because the resiliency that you've had to have as a CEO or CFO over the last many years and then through COVID and now Trump one, Biden, Trump

two, that's all in the memory bank. And now we're in a place where I think some of the policy uncertainty is actually starting to get quantified, it's starting to get better known in the C-suite. So this is kind of a moment at this healthcare conference where you can feel busy activity, strategic, M&A, offerings. Feels like the flywheel is really kicking in. As they call it, animal spirit. So it sounds like people aren't too much.

concerned about what's going on in the jobs market. We saw those very big revisions in the 12 months through March. You're not hearing any concerns kind of behind the scenes from the C-suite level about deteriorating conditions in the labor market. Well, you know, folks like you and I, Leslie, we sort of live and die by, you know, the latest print. But the reality is if you took kind of a positive view of some of the policy execution by Scott, by Bessent, and the team, the three prongs, they kind of front end loaded some of the tough stuff, right? There was a bunch of Doge and then tariffs and immigration. Some of the stuff on the front end, pretty tough stuff

where you don't really necessarily know where the policy outcome is going to shake out. But corporate CEOs start thinking, I've seen some of the headwinds coming through and the policy uncertainty seems to be narrowing a bit and I've been sitting on these strategic decisions. and now we have this sort of endogenous reality of AI kicking in, I need to act.

So, yes, there may be a little bit of a slowdown. There may be a hot print here and there. But today's a good example. Significant negative revision, but rates have sold off a bit, and equities are fine. So what is that telling you? That's telling you that maybe some of the data is backward looking. It's also telling you we're on to the next report,

which is the inflation reports later this week. So we have to see how it plays out. But there is so much going on with respect to the administration's attempt to re-architect industrial policy to deal with these fiscal massive deficits that we've had for such a long time. They've attempted to do all of this in under 18 months. And in fairness, we need to let some of this play out. But a lot of the hard work, the front end of the three prongs, the tax bill, which gets a check, the tariffs, which I'd say get a soft check, they're in the courts,

but a lot of the bilateral negotiations have taken place. soft check and then DRAG, which is clearly going to be a win for a whole bunch of industries, hopefully health care as well. I think boardrooms are thinking, you know what, a lot of the tough stuff has already been put in front of us and on the back of the pandemic. We really don't have more excuses to wait. The time value of inaction is real now. And so you've got to take calculated risk. You either get bigger to try to defeat some of the cost of AI and to sort of scale in a re-globalizing world or maybe you'll siphon off businesses. that don't have the multiple you want.

But for us, the commonality is action. There's action now. And for us, as Morgan Stanley, raises, manages, and allocates capital for institutions, for corporates, for institutional investors, and then importantly for our wealth clients, action is the lingua franca,

the currency of what we do. Speaking of currency, financial conditions, people talk about those being a little tighter maybe than they'd like them to be, which affects deal activity as well. Are you expecting to see more than one cut this year? And do you need more than one cut to make financing math more favorable for some of these capital market trends that you're talking about? Well, the Fed sets the policy rate.

The policy rates at 4.5%. But the bond market does a lot of work for you. As you know, the two years of 3.5%. Fed futures for the end of 26 are forecasting six cuts. So that gets you to 3%. So 3 and a half percent on the two year, 3% on the forward. we're at four and a half all things be equal, rates will start coming in. And the Fed will do that in due time.

I'm curious your thoughts on some of the credibility critiques of some of the institutions, whether it's the Bureau of Labor Statistics or the Federal Reserve or even your peers' economic research department with Goldman in particular. Do you think there's a risk that markets ultimately become impacted with some of these critiques on data, on the Fed, on bank research groups? That was a multi-layered question. I think what I feel most strongly about in that question is Morgan Stanley's research. I think it's outstanding.

I love Morgan Stanley's research. It's a full mosaic of opinions from folks who spent their entire careers working with many data sources around the world under the leadership of Katie Huberty. We got world-class stock research, macro research, industry-specific research. Part of the reason this healthcare conference is such a success where we have 450 companies and we have over 2,500 investors and corporate attendees is on the back of our fantastic health care research. So I love Morgan Stanley Blues research.

That's a 10 out of 10. With respect to some of the conversations that have been had about certain reports, quartz and the like, I guess the bigger picture here, and it gets to sort of, I think, what's implicit to your question, which is sort of this Fed and this Fed independence question at some level. I think a couple things. First of all, Fed independence, the independence of the central bank and setting monetary policy is sacrosanct. It is a cornerstone of American exceptionalism, full stop. That having been said, there are many. instances where Congress and the executive branch have pushed back. They've pushed back and they've

asked, you know, are we at the right place? And we're in a world of social media. So the transmission platforming is ubiquitous. So that is going to get broadcast widely. It's also fair to ask at this juncture with so much going on where we have these massive deficits where the administration's looking to try to re-architect industrial policy. At this juncture, the Fed may ask itself the question where are we on the dual mandate with respect to how hot we may want to run the economy, the timing of when we want to move? And those conversations are healthy and they're important. But at the end of the day, the Fed makes a decision.

They make the decision with respect to the front end. But the bond market is already helping lead them along, and they have a ton of data at their resourcing. It's not just the data we see. many, many different ways to access data as a firm like Morgan Stanley does. And so they will, in good time, get to the place that they think is appropriate to balance that dual mandate, but to also consider what the dual mandate means in a world where we have these fiscal deficits and obviously the once-in-a-generation effect of AI and its implications for employment and productivity.

So it is a multi-level conversation. I'd say one other thing, Leslie, with respect to the Fed, is they're also our main regulator. You know, and so it's an interesting thing for us to sort of have an observation on the Fed, which is to say we are really heartened that the Fed appears to be taking a much more commonsensical approach with respect to our firms like Morgan Stanley offering not just safety and soundness to the system, but being the locomotive to drive economic growth. Because a lot of what the administration is focused on is exactly what our clients are focused on, which is what Morgan Stanley is focused on,

which is sustaining U.S.-led growth. And the economy continues to grow. Ernie's continue to be strong, and that's an important symbiotic relationship, and the Fed continues to exact this prudential responsibility to make sure that the system is working. Yeah, that's a good point regarding the deregulatory posture in Washington. Ted Pick, thank you so much, Chairman, CEO of Morgan Stanley.

Appreciate you doing this from your healthcare conference today. Great to see you. Don, we'll send it back to you. All right, thank you very much. Leslie Picker and Morgan, Stanley CEO, Ted Pick as well. And speaking of the big banks, don't miss our exclusive interview with Goldman Sachs chairman and CEO, David Solomon. That's coming up at 4 p.m. Eastern time tomorrow on closing bell overtime with Morgan Brennan. So a lot of bank CEOs in the mix here on CNBC over the

next couple of days. Up next on this show, we are jet-setting over to Italy. Our very own Brian Sullivan is at the Gas Tech Energy Conference in Milan. He'll bring us highlights from some of the biggest names in the global energy business. Power Lunch will be back after this break. Welcome back to Power Lunch. Let's get right out to Brian Sullivan. He is in Milan, Italy. He had some very big interviews today. The first we are bringing to you is his sit down with Secretary of the Interior, Doug Bergam. Brian, a lot to talk about here. Yeah, there certainly was, Domchew. Thank you very much out here in Milan. By the six hours ahead of New York, so it's about 820 at night. But earlier today, we're at the gas tech conference. Fifty

thousand attendees from all over the world talking about natural gas climate emissions and you name it and more there's a lot of conversation that we had the secretary of the interior dug bergum we started though with this recent attack on ukraine by russia where the white house and others have basically called on europe they've almost pleaded with europe stop buying russian natural gas because you're helping to fund the putin war machine so remember russia still buys a lot of liquefied or sells a lot of liquefied natural gas to Europe. So our first question to the Secretary of the Interior was about this heady goal of selling $750 billion of gas and total energy to Europe. Much of that would displace Russian natural gas. The demand is certainly there between AI and the European countries that are all trying to get off

Russian gas. The whole point of being here this week is for us to following on the heels of President Trump's historic trade deals that have been discussed. That's seven, $750 billion though is U.S. energy, not just LNG. LNG would be one of the easiest things, put it on a ship, send it over here, displace Russian gas, drive their market share to zero in Europe, drive U.S. market share up. That's great for America, great for our allies, and we stop funding Russia's side of the war.

I mean, when we've got Iran, when people are buying Iranian-sanctioned oil, when they're buying Russian-sanctioned oil, then they're using that to fund terrorism and wars against us and our allies. allies. If we stop buying their products, then we're not funding two sides of war. I say we, us plus our allies. So it is an imperative. So this President Trump's energy strategy, sell energy to our friends and allies so they don't have to buy it from our adversaries. That's the energy strategy in a sentence. But also it's about peace and prosperity. President Trump's solving all these conflicts around the world. The way we're going to solve these last couple, part of it is with

the economics of cutting off the economic engine that is allowing Russia and Iran to fund their activities. Yeah, Russia is selling a record amount of LNG to Europe about $8 billion per year. But if you're Exxon, your Chevron, your venture global, your Sheneer, your Semper Commonwealth, or any of the other private companies or public companies that are out there, you've got the demand, you've got the willing buyer.

The question is, and what I ask the Secretary of Interior, is do we have the export terminals and export capacity to even sell them more, LNG? Well, we're building it and we're building it fast. There have been five separate approvals in the first seven months of the Trump administration. Remember, a year ago, if we were having this conversation, the Biden administration had put a pause on even finishing construction of any LNG export facilities. One of the craziest decisions ever made by any administration. I mean, it's bad for America, bad for allies, bad for the world.

but day one, flip that around, let's get going. Some of the projects that are going on on the Gulf Coast, these are 16, 18, $20 billion projects, each one of them, and each one of them can export enormous amounts of LNG. So we're going large on the Gulf. And then, of course, as you know, President Trump has made it a priority with the LNG pipeline in Alaska. We have an opportunity in the coming years for us to sell energy

to all of our Pacific allies, part of the historic trade deal that just got signed with Japan that President Trump and the trade team all worked on. That's going to have Japanese investment coming into the U.S. South Korea, Taiwan, Philippines, Vietnam, all of them, all of our Pacific allies would benefit from getting LNG from Alaska, eight days from Anchorage to Tokyo. It's 24 to 27 days from the Middle East for their supply today.

and countries like Japan, 120 million people living in the size of North and South Dakota with no oil and gas whatsoever, they need more LNG from ever. So U.S. is really teed up for the long term to be a reliable trusted supplier to our allies, both in the Pacific and in Europe. So he is still optimistic that Alaska LNG project will go off. Remember, he is the Secretary of the Interior controls permitting, not just for gas and oil, but for things like offshore wind. We know that offshore wind has been under attack by the White House.

Shares of Orsted, the biggest offshore wind operator in the world, have been absolutely decimated. They've got revolution wind in New England. We've talked to the Connecticut governor about that. And I asked the Secretary of the Interior, if we need all forms of energy, don't we also need offshore wind? Well, they might, but I think that on the all the above should have had a qualifier when people were talking about all the above. it should all the above that can provide affordable, that's key. Reliable, that means seven by 24 means dispatchable. Dispatchable means when I want it, I can get it, and when I don't want it, I don't have to get it. Those are criteria for that and then also supports the health of our

whole grid. And when you take a look at the intermittent sources, the unreliable and the expensive sources like solar and wind, you don't know when the wind's going to blow. We do know when the sun's going to shine and it's not 24 hours a day. And so building out transmission, say, from a solar field to a customer, there's only electrons running on that at night. I mean, you're doubling the cost, you know, building all this wind infrastructure. And then when the wind's not blowing, you're not transmitting any of that. So in offshore, particularly challenging, it can cost up to three times as much as onshore wind.

And then we get into the issues with marine fisheries, with marine mammals like whales, radar interference. I mean, there's a whole host of things that now are literally not just to upset citizens who live along the coast, but actual lawsuits against how these projects were permitted under the Biden administration. Now remember, there was a wind farm off the coast of New York State that got reinvigorated. It is back on. It's called Empire Wind. So I wrapped that up by asking the Secretary of the Interior, is there some sort of deal or some sort of agreement that can be made that would reinvigorate and keep this revolution wind project going. I think that the projects were under discussions with the governors and with the companies in discussions with them while we're also finishing the reviews that we've been asked and required to make through the executive orders. So those things are both happening. But I can't say for certain because some of these projects are a literal train.

in terms of their economics. And if we were to complete them, then we're just locking in billions and billions of taxpayer money, which might be going to a hedge fund. It's not doing anything to help stabilize the grid. And it's not really, it's not a great source of electricity at all. So Dom, you want to watch shares of Orsted in wind? You want to watch shares of first solar in solar.

And then of course, the LNG companies, the venture globals, and the sheeners of the world. You've also got the Exxons, the shells, the chevrons, they're all sort of in the mix. Coming up in about 15 minutes, this is fun. Our friend, Tillman Fertita, now the ambassador to Italy, will join us exclusively as well. We talk about Italy, we talk about business, and we talk a little bit maybe even about sports. That's coming up in about 15 minutes here from Milan, Italy. I'll get his take on food as well. Tillman does know a few things about that as well.

Brian Sullivan, we'll see you later on this hour from Milan, Italy. Now to the credit markets, with Treasury yields holding relatively steady today as investors position themselves ahead of that big key report on inflation tomorrow, the producer price index or PPI, the 10-year yield ticking slightly higher today following its recent drop, reflecting some renewed caution in the bond markets. Traders are weighing whether inflationary pressures remain sticky and what that means for the Fed's policy outlook. A hotter than expected PPI could complicate the case for an interest rate cut cycle. while a softer number may ease some pressure on those yields. For now, markets are moving defensively with investors adjusting portfolios in advance of tomorrow's big print

and, of course, Thursday's read on the Consumer Price Index or CPI. We've now got a news alert on Microsoft. Mackenzie Sagalos has those headlines, Mac. Hey, Don, so Microsoft is turning to Anthropic. OpenAI's top rival for new AI tools in its Office 365 suite, that is according to the information.

Now, Microsoft will use Claude for Excel and PowerPoint after developers found that it beat OpenAI on financial modeling and presentation design. Now, to this point, Microsoft had chiefly relied on OpenAI's tech. Remember, it remains that company's chief investor and partner. And this comes as they are in the thick of negotiations or that big restructure that needs to happen by the end of the year. I'm out to Microsoft and Anthropic on this. No word back yet, though, Dom. All right, McKenzie Segalo is with the latest there on AI and Microsoft. Thank you very much for that.

Turning back to the stock market, near record highs again, despite some concerns that the economy is weakening. We'll get a good indication on the state of the consumer in the next couple of days with two key readings on inflation. Your next guest is still optimistic and thinks the rally in equities has more room to run. David Spika is chief market strategist over Turtle Creek wealth advisors. David, we've been talking about this idea of a possible pullback for months, if not quarters at this point, the path of least resistance has been to the upside.

What keeps it going? Well, a couple of things, Dom. You've got strong earnings growth and earnings revisions going higher, a still resilient consumer, and you get the Fed getting ready to cut rates maybe as much as 100 to 125 basis points over the next six to 12 months. Those are all going to be tailwinds for the markets, and we're still bullish here. If you are still bullish, has it been the bullishness on those maybe seven? to 10 stocks, let's call them in the marketplace that have been driving a lot of the returns,

or is it the case to be made right now that in the case of a possible hypothetical Fed rate cut cycle that other parts of the market will be the better catch-up trade? Great question, Dom, and we have seen broadening out of the market, so other companies are starting to perform well. It's not just the MAG7, but a steeper yield curve, which is what we expect as the Fed starts cutting rates signals cyclical economic growth. And that means some of these more value plays, some of these more consumer and cyclical related companies should start performing better. If that's the case, and it is that broadening out, and we are looking beyond, David,

the magnificent seven trade, the big tech media and telecom trade, what parts of that economically sensitive or cyclical part of the market will be the best values and the best returns in the next six to 12 months? Well, one name we like, and in the financial sector is American Express. they're going to benefit from greater net interest income as we see more yield curve steepening. They're growing earnings better than 10% a year. They had a great second quarter, and they're really growing in the younger generation. They saw 40% increase in spending among Gen Z and 10% increase in spending among millennials. They're going to have their platinum card

refresh, which will provide non-interest income growth. We like that name, and we think a lot of the financials are well positioned. And in addition to that, if you are talking about lower interest rates overall from the Fed. I can imagine that many parts of the interest rate sensitive part of the market are going to respond as well. So what about other parts of the market that are geared towards those lower interest rates outside of the banks? Well, the home builders have been rallying since May or June. They were heavily oversold. And a name we like is Lanar. They're vertically integrated with development, construction, and financing. And clearly, they'll do better as mortgage rates come down. They've got a great balance sheet, great scale,

and we feel like they're very well positioned to grow from this point forward, particularly given they're a very reasonable valuation of 14 times future earnings. All right, the homebuilders in play as well. David Speak at Turtle Creek, thank you very much. We'll see you again soon, sir. You bet. Thank you. All right. Let's get over to Contessa Brewer for a CNBC news update. Good afternoon, Contessa. Dominic, the White House said this afternoon the president directed his top aide, Steve Whitkoff to warn Qatar that Israel planned to attack its capital. Press Secretary Caroline Levitt also said that bombing was carried out solely by Israel. The president continues to view Qatar as a strong ally.

Hamas has claimed without proof that its top leaders survived the strike, but that five lower-ranking members were killed along with a Qatari security services member. Qatar has been working to mediate a ceasefire in Gaza. French President Emmanuel Macron installed a new prime minister today It's the country's fifth in less than two years. Sebastian Lucan Nourg is a Macron loyalist who most recently served as the president's defense minister. Parliament ousted Francois Bahru yesterday over his plans to tame France's debt. And ESPN announced today the talk show, pardon the interruption,

will remain on the air past its 25th anniversary. According to the Sports Network, host Michael Wilbin and Tony Kornheiser signed multi-year contract extensions. So Dom, they've been the host of that show since 2001. PTI, always a great watch there on ESPN. Thank you very much, Contessa Brewer, for that. Coming up on the show, we are heading back to Milan where Brian Sullivan sat down with Ambassador Tillman Fertita to discuss energy, manufacturing, and so much more.

Stay tuned. We'll be back after this. Welcome back to Power Lunch. If you're thinking of getting a little more aggressive with your portfolio, our next guest has some ideas, but fair warning, she says these are not exactly for the faint of heart. So joining us now is Danielle Shea. She's VP of Options over at Simpler Trading.

Danielle, one of the things that we talk about with regard to activity in the marketplace, some of the volatility that goes along with many of these names. You're looking at a handful of them that share one thing in common, but could be there to boost some returns. Take us through what you're looking at. Well, you know, what I like to look for are stocks that have relative strength that are close to the highs and also have an elevated short. short float. This is because when those tickers hit the news, perhaps with earnings or something

else, they can really explode through those highs leading to greater than expected gains. In that case, one name in particular is grabbing a lot of headlines so far today. That's Nebius Group. That's been on your radar. So take us through what you're seeing there right now. And then what else may be in the offing for some of the names that share similar characteristics, not fundamentally from a business standpoint, but maybe from that short interest standpoint. Well, you know, when you look at these charts, they have this relative strength, right? And they have this really nice trend on the daily chart specifically, and they were right near those highs.

With this one, this one ended up hitting the news due to Microsoft. But it has 8% short float as well. And there's a lot of activity in the options market. So when you look at this ticker, what I went ahead and did with this is I added a bullish butterfly targeting the $100 price point. But I would tell investors that if you break through that critical area of resistance, that's I think it'll keep going due to that short float. All right.

And what other names are you watching that share some of those same characteristics, Daniel? Right now I'm watching CRWV and also Galaxy and these are also relatively in the same space. And when you look at CRWV, this one has more overhead resistance. So it's a little bit more difficult to get a great short squeeze out of it. But if it could get above 120, that's where I would really like to see it get going. Now if you look at Galaxy, this one is breaking up above resistance today, which is why I went ahead and took an entry in it. And what I'm trying to do with this one is trade it back up into resistance up into around 30. And then if we could get a

break through that level up into 35, that's where I think the short squeeze would really take off. So I like the incoming volume and momentum in these names. And I also like them for longer term stock picks. All right, Galaxy Digital, Corweave and Nebius, three of Danielle's picks for that short interest play. Thank you very much. We'll see you again next time around. All right. Now we are going to head back out to Brian Sullivan at GasTech and Milan, Italy coming up after this with his next big interview with Ambassador Tillman Furtita. Keep it right here. Welcome back to Power Lunch and let's welcome back Brian Sullivan. He joins us again from Milan, Italy at the Gas Tech Conference. And this time with his interview with U.S. Ambassador to Italy, Tillman Furtita. Brian.

Yeah, I mean, let's end it with a little bit of fun and business. I mean, could we have asked for a more beautiful shot of the Domo here in Milan behind us? First of all, on the business side. So much fun to catch back up to our old friend, Tillman Furtita. He is now the ambassador to Italy and San Marino. He's multi-year term. It's his first interview, national U.S. interviews since becoming the ambassador. So we started, of course, with why we're here, and that is on business, gas tech, natural gas, etc. And he pointed to a company, Baker Hughes, Baker Hughes, run by Lorenzo Seminelli. They've got a massive Italian operation. In fact, many of the turbines, the things that are built that are used for natural gas,

an LNG business in the United States and around the world are actually manufactured in Italy. And Tillman talked about it. Baker Hughes has 5,000 employees right outside of Florence building those, which comes back from the merger of GE that they did with Baker Hughes years ago. And what's amazing about this is it shows again the great manufacturing ability that the Italians have, that they don't even want to move this plant. Because remember, when this all started, it goes back to families that did this for 100 years in Italy,

and they know how to manufacture things a certain way, and it's to their advantage to always keep this manufacturing right here in Italy. Speaking of Italian energy, also venture global trades the U.S. under VG, making a $15 billion $20-year deal with a tie-in energy. giant Eni, and the ambassador, Tillman Fretta, talked about that as well. Venture Global is signing a deal with Eni, which is by far the largest energy company here in Italy, to sell them over the next 20 years, $15 billion worth of LNG.

Now, think about how big that is. That's a lot of money for you, someone. But what it does is, what I'm here to do. is help the trade gap of $45 billion between the United States and Italy. And that's one of the items and one of the contracts that helps me. That's $15 billion over the next 20 years. That's how you do it. Is companies like that doing business here with Italian companies?

All right. So, Dom, we had to have a little fun with Mr. Ambassador as well. He obviously owns the Houston Rockets. CNBC is now the worldwide leader in sports team valuations as well with Michael Ozanian and team. So I talked to Tillman about sort of sports valuations and Michael and CNBC sport and everything else. And the ambassador, I still have a hard time calling an ambassador. His excellency, Tomlin Fetita, did say that he actually underestimated how much the price of basketball teams might go up at value. Listen.

When he did these valuations a couple of years ago, I said, you're way too high, Mike. Well, you know what's happened in all of these sales and people selling interest from the Lakers to the Celtics to the trailblazers? They've blown by the numbers that I thought. So you know what? When I bought the rockets for $2.2 billion in 17, that was the scariest thing I've ever done. Well, the valuation's $5 billion a day, so I'll take it. And when I look at what's happening with these others, hey, I sleep well at night. So, yeah, interesting.

The Ambassador Tillman Fratita, obviously one of America's most successful business people and also owns the Houston Rocket saying he underestimated the increase in value of basketball. Dom Chu, I think that's saying something was great to catch up with him. Great to catch up with everybody here at GasTech and Milan. Tomorrow, another big day. We got an exclusive interview with the Secretary of Energy, Christopher Wright, and some CEOs as well. Day two from Milan, the domo behind us, almost 9 p.m. And I'll tell you what's undervalued, a slice of pizza.

I'd pay anything. I'd pay a lot. I'd pay over-asking for a slice of pizza right now. Risotto, and I'm so hungry. Anything. Back to you. You and Ambassador Fertita both know a thing or two about food. So we'll see if you can find that a good slice of pizza there. All right. Thank you very much, Brian Sullivan. We'll see you later on.

And of course, tomorrow with your interview with Secretary Wright. Still ahead on this show, The Most Red Stories on CNBC.com. today, you'll have to stick around to find out which ones they are. Keep it right here. All right. Welcome back to Power Lunch. Before we go, we want to highlight the most read story right now on our website, CNBC.com today. Visitors to that site are interested in the health of the American job market. According to the Labor Department report, the labor market created far fewer jobs than previously thought, and that's raising concerns both about the health of the economy and the state of data collection. annual revisions to non-farm payrolls data for the year prior to March 2025 showed a drop of 911,000 from the initial estimates.

That's according to preliminary reports from the Bureau of Labor Statistics, the total revision was on the high end of Wall Street expectations, which ranged from a low of around 600,000 to as many as a million jobs. Now, to read this story and many more, just head over to CNBC.com slash pro. subscribers get all the detail and analysis behind those big calls and big stories of the day. Final check on the markets. We are near session highs right now. Fractional gains for the major indices. The NASDAQ approaching another record high. So keep it right here. The all-important last hour of trading is coming up. Thanks for watching Power Lunch.