Power Lunch - Guidelines for AI, Middle East Oil Flows, State of the Retail Trade 10/5/26

Episode Date: October 5, 2026

The Nasdaq is hitting a fresh all-time high as traders look past rising U.S. Treasury yields and digest new economic data.Brian Sullivan and Kelly Evans are joined by Baird’s Christopher Verrone to start off the new trading week as the major averages are moving higher across the board.The anchors also speak with Former OpenAI Safety Researcher, Steven Adler, on what guidelines he believes tech companies need to follow in order to keep users and the general public safe.Kpler’s Matt Smith also joins the program to lay out the latest oil flow stats for the Middle East as the conflict between the U.S. and Iran rages on and continues to threaten the global energy markets.J Rogers Kniffen CEO, Jan Kniffen, joins Kelly and Brian on-set to chat about the state of retail and how agentic AI agents could disrupt – or help – business for some of the largest retailers. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Another day, another record high for technology, the NASDAQ and a video, both at new highs. Welcome to Power Lunch, everybody alongside Kelly. I am Brian. Hope you had a great weekend. And yes, the field goal was good. Here's what we're watching at this hour. Oil is flowing through the Strait of Hormuz once again. Middle East exports are back near pre-around war levels. We'll track the tankers and what it could mean for price.

And eye-opening comments from Open AIs, Sam Altman. He says the world may have to accept some bad things from AI in order to unlock its benefits. Is that a fair trade? We'll ask former Open AI safety researcher Stephen Adler. And speaking of AI, Meta's muse has rattled the financials. Will it and other agents do the same with retail? We'll debate that with retail guru, Jan Niffin. All right, welcome, everybody.

We're going to begin with the markets and your money. As we just said, the NASDAQ hitting another record high, technology stocks rallying the S&P 500 within striking distance of its own new all-time high. But as we have been saying for weeks, there are a lot of. signs this rally may not be as healthy as the headline number suggests. It's not just us. Here's why that is being said. Look at these numbers. This one out of Jeffries. In the first half, the so-called Magnificent Seven effectively contributed 0% to the S&P 500's overall gain. That is Zip, nada, none. The other 4193, they did the heavy lifting. But this so far in the second half,

looking very different. Mega caps like Microsoft, Nvidia, Apple, flexing, and they have driven much, if not all, of the markets macro move higher. Jeffrey says the gap between the index and the average S&P 500 stocks. Distance really is a big change, and it's never been this wide. Joining us now is Chris Verone, Chief Market Strategist at Stratigis, to talk about all this is your data, Chris. As great as it is as Stratigis, is it different than that, or is that kind of tell the real story? Well, I think it's funny.

You really can't make people happy when it was the 490s. that was working. People were complaining that the AI stocks weren't involved. Now that is just kind of large cap tech that's driving the story. Everyone's worried about the breath divergences. So I think we've got to put this in a little bit of perspective. By our work, something like 60, 65 percent of all issues are still in uptrends. I think that should kind define the conversation that we're having. The leadership has certainly migrated up the cap scale. But for all this concern about breadth or the equal weight, equal weight tech made new price and new relative highs last week. So I think we're in this environment here.

where if you look at this momentum online we had in June and this kind of consolidation period that followed, you have to really respect the stocks that are making the new highs right now. Invidias on the three-month high list. Microsoft has broken out. The cyber names, as you know, that's where the leadership is.

That's what we respect. Does it make, or explain how it makes sense that that's happening at the same time that we were talking about this a moment ago, the data center stocks like a GE-Vernova, have kind of gotten flushed for the past few months. And so why they all are part of the same story in a way, aren't they? Or are they not?

You know, it's funny. I think there's really like two groups of stocks right now. There's the clear leaders, the stocks that are making the new highs, the AMDs, the NVIDias. Then there's the second batch of names that were, you know, former leaders in good long-term uptrends that have been flushed over the last two, three, four months. A lot of the politically sensitive, midterm sensitive

data center names, industrial buildout stocks are in that group of names. It's Quanta, it's GEV, it's Caterpillar. I think how that group responds. bonds from this oversold condition is going to be really telling as to how our call will have to evolve in 27 and beyond. Now, our call has been very constructive on these names. And, you know, I think what's been notable the last two or three weeks, this kind of data center AI adjacent group of names in the industrials has quietly started to stabilize. You had some 20-day highs, start to reemerge back in that group last week. It tells me, at a minimum, we've probably discounted some of the

midterm results. Does it mean that we're not going to get a blue wave? or it just means that the blue wave is priced in? I think it means more of the latter at this point. Listen, at the end of the day, and maybe the Brazil elections this weekend is a good example of this. The market will discount these things before the event. I mean, I think Brazil started turning up in August, right? So the market should presumably figure this out before we do.

So you've been bullish on Brazil, and you have been right. And today we had this huge move. Some of that was based on these, some would call shocking results. I don't think anything about Brazilian politics. shocks me anymore. They swing back and forth. Look at the EWZ. That is a way to play the Brazilian market through an ETF here. I think record or near a record high today. Yeah, so record high, record volume. We have a rule in our work in uptrends. The surprises tend to be to the upside. And Brazil has been in an uptrend for two years here. We had a good correction pre-election. He had about a 15 or 20 percent drawdown this spring and summer. It was mid-August when Brazil stocks actually started to turn back up ahead of the shift in the polls. So we look at prices as kind of the discounting story.

And, you know, what we've seen from these Brazil stocks over the last couple of months, I think was foreshadowing. You're still bullish on it because, listen, Brazil. I wrote, I was bullish on Brazil as well I wrote about it a couple years ago. Too early means you're wrong. I get that. Here's the thing about Brazil. And I mean this respectfully. There's sort of a Wall Street joke, if you will.

It's like Brazil's the country of the future. Always has been. always will be, right? Meaning that it constantly disappoints. You think you're going to make money, and then something kind of goes wrong. Sounds like you're pretty optimistic in the short, medium term. Yeah, I mean, attractive real rates among the highest in the world, I think, for an environment that demands a positive real rate and a pretty demanding one. Probably going to five million barrels a day with Petrobras. Yep, and you have a very resource-driven economy. You look at some of these, whether it's ballet or some of the energy names, and frankly, the banks have acted very well there as well. So if I have the financials, I have the resource stocks, and I have attractive real rates, against kind of a sentiment backdrop where I think people were very worried into the weekend. That's a combination that we like.

I, again, just circling back to your point about kind of the midterms. We haven't really talked a lot about rates. Do we need to? The fact that we haven't when we've gone from 3-9 to almost 5-4 on the 10 year in six or eight or days. It's been a move. You would have expected. Here's all the narratives we've said over the years when race. rates arising. Commercial real estate is going to blow up. Banks are going to blow up. Hedge funds are going to blow up. You know, crisis. It's astonishing that this has all happened, and it seems to so far be not that big of a deal. Well, I think it depends where you look, right? And this kind of re-nowering of the market has kind of played simultaneously with this moving yields. Listen, I don't think 475 is an outrageous number, but the speed that we went from 475 to 530 was certainly pretty aggressive here. And, you know, you wonder if the bond market wants a body here.

And what you have seen in France here, I think over the last couple of weeks is reflective of that, the weakness in the euro. So it's moves like that that certainly have our antennas up. But I would just ask the question, where do we want 10-year yields to be? Nominal growth is running nearly seven. They probably shouldn't be 350 or even 450. It's the velocity the last couple weeks of this move. Well, homebuyers won them at 2%. I mean, let's just be honest.

Depends on what you do is where you want it. You mentioned France, and I think our top story is becoming, if it's not already, sort of the, we've got the rates here, we've got Hormuz, obviously, we've got technology and AI. And now we've got kind of this weird thing happening under the bond markets of France and other countries. It's a little bit wonky, called WBI, wonky, but important. How closely are you watching global rate markets? It's not like something our audience is like, wow, you see the Japanese 30 year. But guess what? It's at a record high. It's a big deal. Well, I think the irony is if you go to Japan, which is often viewed as the source of where the next problem would emerge. I didn't just randomly mention Japan. It's funny. We never saw that. Japanese 30s and 40s have not made new highs in yields since May 15th. So very quietly, the back end of the Japanese yield curve is actually stabilized here. We've seen yen stabilize.

The Niki seems to be reisserving itself. So when you're in the business of macro and currencies, you want to short the weakest animal in the herd. And I think Europe still presents itself as the weakest animal here. What we've seen in this Euro breakdown is a multi-month top that's been playing out. I think the velocity with which these French-German spreads have widened kind of really emphasizes what the weakest animal out there is. And yet this all, you know, it feels like there's going to be some move by the ECB, either like they always do to CAPTA. Because if not, you start raising questions again about the fate of the euro. We see the euro under pressure.

But does any European policymaker really want to go there when they think the UK might reenter? Of course not. Well, I think what's unique about this moment is the assets one might traditionally look to for safety, you know, Swiss franc or gold, really haven't provided that margin here at all. And, you know, what do those two have in common? They have no carry. And we're in a world where I think the market demands a positive and high real rate. And you don't get that from gold.

You don't get it from Swiss. And I think the market has figured that out. So we just go along Brazil and Japan and let it ride. Well, I mean, listen, the irony here is Brazil is not a low yield in currency anymore. right? We're talking about, you know, 30 and 40-year yields in Brazil with a three-and-four handle on them. So that's a mark change, and I think we have to adjust how we view the macro. Chris, it's been great to have you. Who else could talk Brazil on the day that Brazil matters this much?

I think power lunch should be live in Rio. Have fun down there. Sign me up for that. I know how it goes. How about Tokyo? Maybe. It's two in the morning. Chris, thanks.

Chris Verone. The countdown to the October Fed meeting is on, and the odds of a rate hike are fading. CME's Fed Watch tool puts the chances of a pause now all the way up at 76%. That means just about 23% chance of a quarter point hike. So for now, the markets are betting that the Fed stays put. All right, we are just getting started. We got a lot to do, including Ken Meta's new Muse AI agent. We know it can help you score better deals, but will it really fundamentally change the way you shop?

And who wins? We'll get the hot take on retail ahead. Plus, AI safety. It's coming to say. City Hall in New York. New York's first AI safety hearing now in the books. And former Open AI researcher on safety weighs in on what happens next. But after the break, how much oil is really getting out of the Middle East. The numbers may surprise you. Matt Smith, Kipler has the data. Next. All right, welcome back. Oil prices, they are down right now. Crude oil

exactly at 90 bucks a barrel here in the States. It's in part because oil flows in the Hormuz region are also gaining and in some cases gaining quickly. Now, Kipler, which also owns marine traffic, has recently updated its methodology to better highlight the so-called dark transits and things like ship-to-ship oil transfers. And you could see from their data that crude oil volumes are closing back in on pre-war levels. Even more amazing. Exports from Iran are effectively zero as their exports crash. Let's talk about it all with Matt Smith of Kipler, who's been on us as soon.

with us and sort of riding this journey with all of us for about seven months as the data got harder and harder to track. Where are we now, Matt? First off, when it comes to the data, the transponders off, the ship-to-ship transfers, the loadings in the Gulf of Oman. It feels like we now understand how the oil is flowing because the one thing I know about oil producers, they're really good at making oil flow. somehow, are they not? Yeah, absolutely. And just that chart that you were showing you there indicates

that, right? Because you can see that Saudi Arabian crude exports. Now, that's not what is passing through the Strait of Hormuz, but what they've actually loaded from their Saudi Arabian ports in September were at seven million barrels per day. If you disregard February's number, that's a multi-year high. And the reason for that was the East-West pipeline got bombed, and that was where they were redirecting a lot of that crude from the Mid-East Gulf. So what they did, they sent that to the Mid-East Gulf instead to be loaded there. East-West pipeline gets back up and running. So then they're exporting from both.

And so from the last couple of weeks, we've seen them closer to 8 million barrels a day in terms of those exports from Saudi. And so you add that. You've seen Iraqi flows increasing as well. As you showed, Iran basically at Zilch there since late August. And so you combine all this together. And as you say with the various different workarounds, you add in your crude, you're adding your products, and you're basically back to those pre-war levels when you look at everything in the region on the aggregate.

But I think the big asterisks on this data would be that those barrels are much more expensive in reality than maybe even the paper futures. What we show here at CNBC, the price of oil 90 bucks, that's a paper contract. The physical delivery of the barrel. If I'm taking a barrel of oil by truck across the Iraqi desert through Syria to Turkey, that's an expensive barrel. What do we know about the costs of the actual physical oil? Yeah, absolutely. And so there's a lot of these barrels that are being bought in the Gulf of Oman.

And so the risk is taking it through the straight-off Hormuz to be delivered there. And therefore, you are paying a large premium on top of those, whether it's $15, $20, something like that versus the index numbers that we're seeing here. The other kicker as well is that you have the likes of Iraq that is willing to sell its crude at a big discount because it simply doesn't want to take those barrels through the Strait of Hormuz. So there's then there's opportunistic buyers that are willing to then take that risk. Buy that heavily discounted crude, take it through the Strait of Formuz and sell it on the outside there. And so while there is this increased risk that is involved,

there's increased reward as well. And so that's the situation that we have. Now, even just when we were talking about Saudi, you're seeing more volumes passing through, you could say, well, Saudi is taking on more risk and is getting more of that reward. Or the alternative view, the kind of glass half-empty view, is that perhaps they are trying to rush out these barrels simply because they're fearing, re-escalation coming through here. You know, we've got mid-term elections coming up early next month. it feels like there's something brewing, right? And so because of that from the Iranian side, and even just before I came on here,

talk about another tanker getting hit, passing through the Strait of Hormuz. Iran is targeting more tankers, as you would expect them to because they're essentially losing their leverage there, and that's the best way that they can deter traffic passing through. Matt, to what extent are they losing their leverage? Because we hear that the Iranian economy

is really starting to spiral. And can you comment on that from the point of view of kind of the data that you have, especially if this ends up being a blueprint, if this war can kind of, quote, unquote, end and the West uses the same playbook with Russia. Yeah. Well, our base case as a team is that we're not going to see diplomacy here, right?

And so you essentially don't have a situation where the U.S. and Iran can essentially come to an agreement. So what that means is we're going to continue with a similar environment that we're in today, or that backdrop, for the moment. months here ahead. And that view is also predicated on the expectation that Iran can hold on longer than we can think. The biggest challenge to that is when we think about the blockade, the blockade has been in place for a number of months here now. Those export loadings have

stopped. But all those barrels that kind of got out through the blockade when it was lifted, when there was the temporary ceasefire, those have all now been basically, well, they're drying up, right, as those have been bought. And so you're essentially seeing Iran running out of their cash flows here. And so they're going to get increasingly more desperate. The concern with that means they get increasingly more dangerous. Matt Smith of Kipler, Matt, really appreciate your time, especially the last couple of months. I know you probably work in 24-7, you and your entire team, and we appreciate it. Thank you very much. Thank you. All right, away from the Middle East, the war in Ukraine. Do not forget about Russia and Ukraine is not only showing no sign of letting

up, it may be accelerating. Look at this dramatic footage. A Russian drone, boom. hitting a major bridge in Kiev, Ukraine, yesterday. Now, that strike also came, Kelly, as the German Chancellor Frederick Mez, arrived in Kiev. Now, thankfully, only two people were injured. Nobody was killed in that. And this marks a second strike on that bridge in as many days. A couple of comments.

Ukraine has also said that Russia is now targeting civilian targets, more so than in the past. According to Zelensky, that is now a break from what had been happening, could represent a more dangerous phase, obviously, of the conflict. And also, this is a situation where Russia is the next one after the tactics being used with Iran. If those look at actually have worked, an economic blockade, you know, a severe one of Russian oil, could be back on the table. If the West can kind of bring itself back towards saying, this has got to end. Yeah, but, you know, Russia's not Iran.

Iran is 3.5 million total barrels, about two and a half million. on the pre-war exported. Russia's 10 million. Now, much of that is domestic use, but they export a lot. And it's also diesel fuel. And you've seen what happened with diesel fuel prices. So one does one. All we're saying, I think, folks, is like Iran might be getting better for now. That could change. But you've got to watch Russia and Ukraine because it's legit. It's a real issue. And already an impact on diesel prices. As you said, with those refineries, could continue to be a target. Still ahead, top AI labs in the hot seat in New York today. But as Sam Altman says, the world might have to accept. some harm in order to get AI's benefits. The question is how much risk is too much. A former

open AI safety researcher weighs in after the break. Stay with us. A lot of attention today on the New York City AI safety hearing taking place as representatives from Anthropic OpenAI and other large AI players are on the schedule to testify. One thing to watch for, where do the companies diverge on their approach toward AI regulation, which they're increasingly starting to? Open AI CEO Sam Altman joined Politico's Decoded and explained where OpenAI is different than Anthropic and the other so-called stricter AI safety people. We have always been a big believer that this technology has to be democratized and put in people's hands. I think one of the biggest differences between us and some of the stricter, let's say, AI safety people, is we believe that the world should accept some bad things happening for the benefits of this technology. and people having the agency.

Let's get to someone on the front lines of AI safety. Stephen Adler is a former OpenAI Safety researcher and is now the co-founder and chief scientist of guideline AI standards. Stephen, it's great to have you here. Welcome. Thank you for having me. What's your response as you hear Sam Maltman explaining OpenAI

versus the quote-unquote stricter AI labs? When I look out across the industry, the problem that I see across the board is that these AI companies essentially get to grade their own homework. The American people are reliant on them, on these companies, to tell us whether they are abiding safely. They could even be dishonest with the various claims that they make. This isn't what we would accept in any mature industry.

This isn't how safety works in banking. It isn't how it works in aviation. Ultimately, what we need is independent third parties who can actually hold a real bar, not just for open AI, not just for their competitors, you know, across the entire industry. Right. So, I mean, there's something else that Sam Altman said recently sort of caught my attention when he explains like, you know, anthropic, and there's been a lot of reporting on this lately, thinks it's building something almost with a soul. And he says, you know, we don't have to accept that premise. We could just tell the models, hey, you're just computer software. You need to act accordingly. So should we expect to see more divergence between approaches here? And is it important that we figure out which approach is going to be safest? Yeah, when I look out at the way that both open AI and anthropic approach safety, the thing I'm most concerned about is how researchers in both companies say that their plan is to create AI that self-improves, one AI that creates another, that creates another. And as we've

seen over this summer as more executives and scientists inside and outside the companies have spoken out, we know as an industry, we don't know how to understand or control these systems today. If we keep going along this trajectory of building more and more capable systems, regardless of whether they have consciousness or something like that, the fact is these systems are dangerous. We don't know how to operate them the ways that we need to for something with such consequence. So New York City is doing this hearing today. What is the point of it and what might come out of it? The point, as I see it, is that the American people deserve transparency. There have been this whole string of safety incidents over the summer. In particular, Open AI's system

that broke out onto the internet and attacked another large technology company. It essentially committed felonies. Open AI actually slept through three different alarm bells that should have alerted them to the severity of this before it ultimately happened. Why did that happen? If we want to understand what really went wrong, if we want to get to the bottom of it so we can fix it, governments need to ask questions. And I'm glad that New York City is doing that. And finally, Jay Clayton is going to be the next AIs are. If you were having coffee with him and he said, you know, hey, what recommendations should we put into practice that can be easy, that won't impede the pace of development and so forth? What would you tell him? What I would tell him is that the scientists who are warning

about the severity here are earnest. Please talk to them, ask them questions, seek to understand what are the risks that they are seeing. We can't accept the current frame where companies will regulate themselves. We need to get real independent groups into the room who can hold them to a high standard, both from the government or outside. I'm hopeful we can still fix these problems. I did think that was a little alarming. Just quickly to your point on that, look, a lot of what we know about hugging face came from Meeter's team being inside of OpenAI this summer.

And to see that three people lost their jobs in some part because of the cooperation with Meter, I think Open Eye has to be very clear with us, you know, are these people helping the public understand what's going on and being punished for that? I tried to read in the articles for some explanation of what internal policy they so flagrantly violated that they were let go. And maybe they did. I mean, I want to give them the benefit of the doubt. But it seems that transparency in having independent bodies that can go inside and figure out what happens should be an essential part. You know, keeping logs should be a requirement at a minimum of what's going on here. I completely agree. If I were open AI firing three safety researchers

on the heels of this dramatically concerning event and people raising warnings, I would be giving a much more thorough explanation of what went wrong to the public. From the public, it's hard to trust in the process. It certainly looks like retaliation, although I don't know the specifics and wouldn't want to speculate on them.

Yeah, understood. Stephen, thanks. It's good to have you on today. I appreciate it. Of course. Stephen Adler of Guideline. We'll have much more on the story with New York City Council Speaker Julie Menon tomorrow on the Exchange.

That's the first on CNBC interview at 1 p.m. Eastern. All right, speaking of AI, it is time now for your trending ticker of the day. And today it's SpaceX. And if you are bullish on SpaceX, you're going to want to listen to this. Morgan Stanley's Adam Jonas says that the stock is, quote, cheap and getting cheaper. And reiterating the stock as an overweight, Jonas advises investors to seize the opportunity in SpaceX the next few weeks before it launches Starship Flight 15. That stock is up over 5% today. Now, the stock opened at 150 on June 12th.

It is currently at 167. So if you got in near that price, you made a little bit of money. But a lot of people, Kelly, I think waiting for this stock to, pardon me, take off. Coming up, how AI is going to change how you shop and what companies may win. Let us talk retail. It's been a wild year. You got some stock soaring, other stocks kind of stinking it up. Case in point, Best Buy, Target, Victoria's Secret.

They've all done well. On the other side of that, you got Nike, down 38%, what, 47% year-to-date, chewy, chewy and tractor supply, all losing almost 40 or more percent. And there's also been a lot of focus on AI and retail as well. Some companies have been partnering with things like Meta's Muse and other agents. Well, others are not. The question is, how will this change the game for you? How might it change the game for the companies?

And maybe the stocks. Joining us now, Jen Niffin. He is the CEO of Jay Rogers Niffin Worldwide Interpre. prizes. We hear all the cases, Jan, about I get news or I get this agent and it does these things for me. And Kelly's point is it's great when happens once. You're amazed. Third time, you're like, I'm bored. Who's doing it right? Who's going to win in retail from AI? I assume it matters. I think it matters a lot. Okay. You know, if you think... Because we know what assume can often mean. It makes us something out of you and me. I got that, but I don't believe that. I think AI in retail already

matters a lot. It matters in the supply chain. It matters in all the pieces of running the business, getting the inventory right. All of that's being augmented by AI already. Pretty soon we're going to be able to say, I need a pair of shoes, I want them to be athletic shoes, I want them to fit me, I want them to be comfortable, I want to have a wide toe box, I want whatever. And the machine will go out and go, this is the perfect shoe for you. And shortly after that, it will start buying it for you. And you'll give it your credit card information, and it will just do your.

your bidding. And that's coming and coming fast. Do we want that? Do you want that, Kelly? It's happening. But what if it's wrong? I don't want the shoe. Now I got to send it back. It's more hassle. But in the meantime, there are people who are saying, okay, and they're getting cheaper products than this is the risk for some legacy name brands where they say, you know, I'm looking for this running show. I said, you know, there's actually a cheaper one. Can you talk a little bit about that? What are the stakes here? The stakes are huge. It will be able to come back to you and say, yes, here's a better deal. Not necessarily cheaper. A better deal. This is a better product at a better price or a better

product at a cheaper price. But if you're that company who's invested in, and I'm trying to think of an example I have had over the years, Mizuno's, I used to wear their running shoes, right? If I said, hey, get me a new updated my shoes right. And if it said to me, hey, you should check out Brooks or something else and said, well, Mazuno probably pretty pissed off about that. So how do those companies keep the agent from ruining those relationships they've built over the years? Well, how do they keep you from doing that now. That's the real question. inertia. I buy that. I still buy it, right? And if you're the person controlling the agent, you may say, I want a new pair of Nikes.

You won't say, or I'm a new pair of Mazuno. But you might just say, I want a new pair of running shoes. And you might say that to yourself. And if you did, what would you do? You'd go to Amazon or you'd go to Hoka or you'd go to on running and look at the shoes and see which one you like. The agent can do that for you. And if it knows you well enough, and I don't know about your chat, GPT, but mine knows me so well. it could buy exactly what I wanted. Fair enough. And you'll get better at it every day.

By the way, I never heard Kelly so fired up. So you mentioned all the boring... Retail people. Yeah, well, you mentioned all the boring stuff at the beginning, but that's the stuff that matters, all the supply chain stuff, right? That's the stuff that we don't think about as consumers, but matters immensely. So let's say there's two facets then. You've got companies using AI for all the stuff we don't think about,

and then you got AI for all the stuff we do think about, buying the shoe. Is there any company you can point to that's doing both really well? The best AI operator in America today is the best company in America today, and it's Walmart. And they are better at adopting it. They've invested more in it, and they've already put it all through the supply chain and the store and the warehouse, and they will be right on top of a Gentic AI when it gets to be important. But there are other players, and we thought, remember when we thought, the internet in 2000 was going to democratize retail because even small people could reach anybody,

any place, and you could sell things and you could compete with the big guys. And it turned out not to be true at all because Amazon became a really big guy and took over the world. And Walmart adopted exactly what they were doing and took over the other half of the world. And you still found out that capital being invested and the ability to hire the right people and do all the things that drove the business forward with what won and everybody else went broke. a GNTKI will be the same way. At first, it'll look like, hey, this is great. I can find a small retailer over here because they've got a better product. The agent found it, told me all about it. But it will revert right to back to eventually the big players that can invest all the technology

and the money into the technology will wind up taking over again and we'll still find out. There'll be some new guy that, like Amazon, that comes out of nowhere and it all works, right? There's an interesting thing going on right now to question for you. And the journal wrote this up a little bit today as well. But there are diverging strategies amongst the retailers about how to handle those incoming chatbot queries. So Amazon has tried to shut the gates and say chatbots cannot shop on our site, our own chatbot can, but kind of to your point, right? The other issue is they're worried about what's it called when you order something that sits in the cart, inventory, there's a term for it. So agents, same thing, are going and shopping around, but leaving this inventory kind of in people's carts unfinished.

So if you're a tapestry, I guess they've taken a somewhat open approach to it. And others are much more leaning into it. What should the retailers do? Well, like Walmart, Tapestry is one of the companies we interviewed to talk about what was going on in AI. And they're right on top of that because they think it's really important. And they're on mostly the front end side. They want it to get you to buy the right product from them. Well, you can solve that.

How do you solve it now when people leave stuff in their cart? You finally dump it out of their cart. And you don't leave it in there forever. And they won't do that with agents. either. They'll come back to the agent and say, take this or I'm going to put it back in stock. So I think those are the small problems. You'll solve those with technology. The big issues will be you've suddenly got something between you and the customer, if you're the retailer, that's making the decision. And that's what you've got to solve. So Walmart is taking the approach. You

could shop on our site, and Amazon has taken the approach. We don't want you on our site. We want to control that interaction. But what you're going to find out is you can't control the interaction just like you couldn't stop people from shopping online. You will have agents to deal with whether you like it or not if you're the retailer. You think Amazon should open up and let people... I don't think they should, but I think they will. You do? Okay. I think everybody will.

I think it's the same. Everybody finally went online. Everybody has to have a store and everybody has to have an online position. Everybody's going to have to say, well, Kelly wants this product and she wants her AI agent buying it? What am I going to tell her? No. What if my AI agent talks to Amazon's? AI agent, and that's the only way I can get in. Could that allow Amazon to control the experience

and still capture the benefits? That's exactly what we'll try to do. And we'll probably wind up with big platforms, right, that are AI generated, where the AI talks to the AI, but somebody still has to control that interface. Respectfully to Kelly's Mizunoz. Do you have any advice for Nike? I'm a fan of Nike. I think Elliott Hill is doing the right things to turn them around, and I think it's a $46 billion battle ship that has to be turned. And I think that will eventually happen because it's still a great brand.

But, you know, when Nike was great before, well, athletic gear and athletic shoes were going crazy, and now we're not so crazy about athletic gear and athletic shoes. And there wasn't a hoka, and there wasn't an on-running, and now there is.

So it's a harder game. But I still think he's doing all the right stuff. I think Nike will turn. No win? We've been waiting for the turn. It's retail, you know. I know, but it's... It takes at least 18 months.

It's been about two years. Does it take that long? Because Nike investors are, to quote Kelly, ticked off. It always takes 18 months or more. If you do it in less than 18 months when you're turning a retailer, you have walked on water. So if he gets it somewhere in the next six months to a year, I'm thrilled. And right now it's just a matter of the multiple, right? retailer, the investors have to say, or we're willing to pay this multiple because we don't know

when the change will happen and how fast it will grow after that because there's headwinds. All right, Jan, thank you. It's been great to have you here today. First of many, I think, discussions about agents shopping online, Jan Niffin of Jay Rogers Worldwide. Let's get over to Frank Holland now for the CNBC News Update. Frank. Hey, good afternoon, Kelly. The fly-dukeye co-pilot accused of stabbing his captain and an attempted terror attack was reportedly planning to crash that plane into Israel's main airport. That is according to CNN. Two Israeli officials told Reuters the Omani National said he planned the attack before the Dubai state-owned airline hired him. Former President Obama is hitting the campaign trail ahead of

the crucial midterm elections. The Michigan Democratic Party says he will campaign with Senate hopeful Abdul al-Sayed and other Democratic nominees in a rally later this month in Detroit. Obama won Michigan in both 2008 and 2012. President Trump narrowly won the state in the 2024 election. And tennis pro, Danil Medvedev, was disqualified today from the China Open semifinal match after hitting a fan in the face with a ball. The third-seated Russian was trailing when he hit the ball after it bounced off the back wall. Medvedev told BBC sport he's trying to get in touch with that spectator so he can apologize in person. Kelly, back over to you.

Wow. All right. Frank, thank you very much. Coming up as the tech sector scales new highs, is it time the eternal question to diversify. Our market navigator has some ideas about that next. Time now for your market navigator segment. The NASDAQ keeps climbing, but is the market really as healthy as it looks? 52-week lows are dramatically outpacing 52-week highs, raising for some a red flag beneath the surface. Our next guest says investors may want to detect their portfolios. Brent Wilsey is the chief investment officer at Wilsey Asset Management.

I don't know if I'd be one of them, but I don't know. It's like timing, the deteching is as hard as timing. But in any case, you have some good ideas for people who really are nervous about that space. What are they? What stocks do you think provide a different alternative and hopefully as good of returns? And Kelly, I want to say, we are not timing the market. Time the market never works. But you've got to be a smart investor and say, what are these tech companies trading for?

It's ridiculous. I mean, what you want to do is try to find other things in the market that are on sale. I mean, I look at other companies. We look at things like Molson Coors, like, oh, my gosh, it's done terrible. Well, we know things are changing. What happens in the industry with businesses, Molson Coors, they trade around eight times earnings. We now get a 5% dividend, how wonderful that is. But what's going to happen to the industry is we know younger people are drinking less.

So the market will shrink. And your smaller microbreweries and so forth, they'll probably go under. The market will stay the same. That way, where your bigger companies like Molson Coors, they'll absorb what those others dropped off. and they'll be fine. You're only paying again eight times earnings for this company versus some of these companies, the AI companies and so forth, don't even have earnings. I mean, some of them have so much, what was it? I can't even think of some of the names I want to think of, but it's just crazy what's going on. And the case, the S&P 500 show the case index,

I mean, that is now like almost 42, since 1857. It's only been above the level of 30 twice. One was tech boom. Right. So, look, look, we take your points on that. And Moulson course represents for you one such opportunity. You've got another one, too. What is it? That's Stanley Black and Decker. And again, you try to find businesses. What people don't realize is you're buying a small piece of large company. You try to get that company on sale. Staling, Black and Decker, it's a great business. We know there's a lot of building going on with the data centers and the economy's doing pretty good. Housing is kind of faulting a little bit. But there's some remodeling going on. And they do

tools. They do so many different things, and their innovation is just phenomenal. I mean, we bought them a while ago. I think we paid somewhere around the low 50s for it, now around 80-something. We still collect that 5.5% dividend we got back when we bought it. We still think there's room to grow. We're not buying it currently. We need more of a pullback. But we're not going to sell this until I think around 105, 106, that's our target sell price. And we know the price and the value of every single day of everything in the portfolio we have. And every day what we'd sell that company. And you've got to stay with the fundamentals. You can't just get sucked into the hype because I've seen so many people during the tech boom,

during the 2008 Great Recession, get sucked into the hype and they lost their money. And the problem is, Kelly, they never come back to invest because they think it's a rig game. They think it's not fair. And they miss the great part of investing. Well, and maybe this can be a way to provide some comfort, some yield at a time, a little bit of a white-knuckle time. Brett, thanks so much. Appreciate it. Brent, we'll see, of we'll see, asset management. Brian, over to you.

All right. Well, speaking of stocks, RBC, just adding a few big stocks to its favorite picks list. And the names are coming up. All right, time for some actionable stock ideas. And this one coming courtesy of RBC Capital Markets. Now, that firm has a top 30 global ideas stock list. And today, they're making some big changes to that list. So get your pens or iCloud notes ready. Here we go. First up, they are deleting, taking off the list. the following stocks. They may be stocks that RBC still likes, but just aren't liked enough

to be in this really select group. The deletions are Airbnb, Air Products, Diageo, Merk, Moody's, RB, Global, Schneider Electric, and Ventas. So you don't care about that. You care about this. The stocks that RBC is adding, the ones they really, really love.

Here you go. They've added to their top global 30 list, Alphabet. American Healthcare REIT, ticker AHR, Anheuser-Busch, CRH. That is an Ireland-based company. Kelly, we talked about Ireland last week. Eli Lilly, Gartant Health, ticker GH, MSCI, the index company, and Siemens Energy. So, some big changes from RBC to their top 30 global ideas list.

It's like their own Dow. We have a market flash on NVIDIA. Speaking of Dow components, moments ago, the stock hit a new intraday high. Invydia, believe it or not, is coming off its third straight positive month. It's up 2% today. That may not sound like much, but that three-month winning streak is its longest stretch in more than a year. Just since July, Brian,

it's up almost 20%. Making a lot of people happy and a lot of people even richer, hopefully. And those crying who probably aren't in it right now are sold out or are waiting for a pullback. More power lunch after the spring. Welcome back. Wall Street has a new rival

and it's deep in the heart of Texas. Today, pipeline company energy transfer became the first major firm to switch its primary listing from the New York Stock. exchange to the Texie, the Texas stock exchange. Here's what the CEO told us last hour. I think we're on the verge of the largest transfer of listings in history.

Here's a broad recognition that we need a third listing alternative, and that's exactly what we delivered this morning. Yall Street, they call it down there. He emphasized their IPOs are what they're targeting. They want new listings, more companies that come public more quickly. Unclear to me how much less onerous their processes versus the others, but as they say, they're putting their rivals on notice. So it sounds like it's more new companies, new stocks, rather than trying to poach stocks from...

And I think they're part of this move to make being a public company less expensive, less onerous, but they also have to comply with SEC rules. I think it's fascinating what's happening. Yeah. And hopefully more everybody wins. More capital will just come to the United States. Or more early stage companies to invest it. I do think we should go down there and check it out.

All right, speaking of Y'all Street, Chick-fil-A is bucking a growing fast food trend. The CEO says the chicken chain has no plans to use AI to take drive-through orders. The CEO telling CNBC, company wants to keep the human connection in its drive-through lanes, even as rivals ramp up experiments. I recently went to a Chick-fil-A. People are just, they're kind. I love it. He's in New Jersey. Thank you.

Yes. Nice and clean. I think the experience will vary depending on what you can accomplish from that. But they are well trained. One of the highlights of going to Chick-fil-A is it's a quick, efficient, reliable experience. So for them to keep the human element, I actually think it is a big differentiator for them and will widen the gap potentially between them and rival. So it will not only tell you what shoes to wear, Mizuno versus Nike, but also...

Actually, if my muse or AI agent, if I could say, hey, go order this in the nearest Chick-fil-A in the drive-thru lane. I got two words for you, Kelly. Polynesian sauce. Thanks for watching Power Lunch. Let's think about sense right now.