Power Lunch - Short Interest in Energy Sector, Mideast Tension's Impact on Crypto 6/24/25

Episode Date: June 24, 2025

CNBC’s Tyler Mathisen and Kelly Evans take you through the heart of the business day bringing you the latest developments and instant analysis on the stocks and stories driving the day’s agenda. “Power Lunch” delves into the economy, markets, politics, real estate, media, technology and more. The show sits at the intersection of power and money. “Power Lunch” gives viewers a full plate of CNBC’s award-winning business news coverage, plus a healthy dose of personality from the show’s anchors and the network’s top-notch roster of reporters and digital journalists. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Stocks are soaring as the world hopes for peace in the Middle East. Welcome everybody to Power Lunch, big technology, just a hair off a record high as President Trump drops an F-bomb because another bomb literally dropped from Iran. But investors, Kelly, hope the worst is over and a new closing high. Maybe on the world. Poetic. I like that. The other big story today, Fed Chair Jay Powell wrapping up his testimony on Capitol. I don't know if we'd call that poetic.

I mean, in some ways. It was a couple of hours long. Wall Street was hanging on everywhere. He fielded questions on inflation interest rates, the path forward for the economy, and the Fed's next move. And that's where we start today. Let's bring in our senior economics reporter, Steve Leesman, for a recap, Steve, of the key headlines and takeaways, which appear to amount to. Powell still sounding pretty hawkish, but the market may be not necessarily believing him. Yeah, going its own way.

I didn't hear poetry either, Kelly, but Fed chair, Jay Powell on day one of two days before Congress, sticking very much to his view that the tariff inflation is coming, likely coming, and the Fed should wait to see how it affects the broader economy before cutting interest rates. We haven't fully restored price stability, and another shock, we have to be careful. If there's a meaningfully large and sustained inflation shock, we have to be careful about that. And so, you know, I think we're just trying to be careful and cautious. Powell said he expects tariff inflation show up in June and July. Note those two months. That's a July report and an August report on inflation. But the Fed, he said, can adapt policy if that doesn't happen.

He noted that most officials still have two rate cuts built in for the year. So suggesting that most think inflation will eventually be at a level that allows them to reduce interest rates. And that is precisely how Fed futures continue to trade. You can see there 19 percent on July. You know, it's higher than it was, but still a long shot bet. But more confidence in rates now coming. September and December. Those are both a little higher on the date, 86% for September and 84% for December. Two Fed governance, as you know, they said they could see rate cuts coming in July, but several Fed officials joining Powell today pushing back, saying the Fed should not be in a hurry to cut until it understands the impact of tariffs on inflation. Guys? Makes sense. Steve, thank you for now. We appreciate it. Steve Leesman. Another big story

of following today, the president landing in the Netherlands just moments ago for the annual NATO summit that kicks off today. Top of the agenda for member countries is endorsing his defense spending goal, increasing members' budgets to 5% of GDP, a huge increase from the current average of 1.7%. Our next guest says it could provide an investment opportunity in companies that could benefit from those dollars. Joining us now for more is Matt Orton, Chief Market Strategist at Raymond James,

and here on set with us, Sarat SETI, managing partner and portfolio manager at DCLA. He's also a CNBC contributor with us for the hour, if I'm not mistaken, Sarat. Welcome. Matt, quickly to you, does today provide a cautionary tale of investing in defense companies for that reason? Because they're all lower on these ceasefire. So can the long-term spending goals offset the geopolitical risk premium that may be coming out of them? Hey, Kelly. It's always great to see you. And I think they absolutely can. It's not at all surprised to see the market selling off a little bit on the encouraging news we've had with the ceasefire between Iran and Israel. But at the end of the day, moving from the targeted NATO of

2% to something that's now going to be 5%. That's a very, very big deal. And I think there's a lot of support that is President Trump's primary goal is to get that objective. And if you break down that 5% goal, 3.5% of that is coming from hard defense spending. One and a half percent of that goal is going to come from defense infrastructure-related spending, like cybersecurity. And so when I look at the defense space, I think companies that are levered to defense electronics, defense communications, areas that straddle both of those ponds of spending, those are going to be the big winners going forward. And so that's the theme that I think is durable.

And similar to what we've talked about in the past, I would use downside opportunistically in some of these names. If you get more of a pullback, I think this is the time to reload because I expect earnings to be solid, visibility to be solid. And these are all high-quality investments generating increasing free cash flow. And if you mean into the electronics, you'll be set. Do you, Sarat, think it's an opportunity, a sell-off day like today? I would look at it in two ways.

I think the stocks have done really well, and my question is more durability as to, again, what happens when you have a new administration? What happens when three to five years from now you kind of look back and say, hey, do we need to be doing this? And the sustainability of that earnings power. But I do agree, there are some great companies out there. What the viability of the targets? I mean, they say 3.5% on core defense spending, one and a half percent unrelated.

And they're having a hard time. They could say, they could sign a piece of paper and say we're going to hit that. And the analogy I have is kind of Airbus and Boeing. I mean, you know the orders Boeing and Airbus are expecting, right, for the next 30 years. But that's not built into the stock price either. And yes, Boeing has its own issues and it's kind of resolved it. But if you actually said Airbus has all these true orders, the stock should be way higher because it's almost guaranteed cash flow. But you know, things change.

And, you know, companies might say, I don't want this aircraft or I extend it, et cetera. So I do that. You buy them on dips, but you have to make sure I think you've had that opportunity in that big run, but you'll get kind of some trading opportunity. I want, you know, Matt, though, listen, the market story is so much more dramatic than that the last three months. Two and a half months ago, national news shows were leading with were doomed and retirees are being wiped out and everything's ruined. And now we're going to close at a record high today, most likely, on the NASDAQ 100. What happened? Is that because the president backed off tariffs? Is it the pause? Is it something else? Yeah, it's a great question, Brian, and one that a lot of clients continue to ask because I think they're perpetually surprised by the ability of the market to scale this wall of worry.

And I think the primary reason why that continues to happen is because sentiment remains low. I would argue that positioning still isn't at exuberance with respect to this market. and we're in the process of recalibrating to uncertainty. We came into this year knowing that uncertainty was going to be high, but I think Liberation Day caught many investors off guard, and as a result, we've all been too pessimistic about where this market can go. And so I think that continued climbing of the Wall of Warwick, Bernie is coming in better than expect.

Hopefully, seeing more trade deal sign going forward, all of those marginal pieces fit into the greater market narrative that you can continue to move higher. And I think the main thing that will propel the market to sustain all-time highs if we hit them is earnings. It's all going to come down to companies delivering on the expectations that are built in. And I think selectivity becomes more important. There's more dispersion out there. And that's why you want to lean into longer-term durable themes like defense and electronics.

Listen, there's nothing wrong with making mistakes, Sirot. We all make mistakes in all facets of our lives. And I think it seems clear the markets viewed the tariff liberation day as a mistake. Maybe the Peter Navarro Camp winning out at the time was not the right way to go, kind of push that to the side. I think the best camp kind of took over, as I said at the time, by the way. Do you feel like we've learned from maybe those trade mistakes? Well, I think that the market learned quickly. It was a self-inflicted wound that had the ability to kind of readjust.

I punched myself in the face. Basically. And I said, you know, I'm doing this to myself. So how do we not hurt ourselves as much? You have a big beautiful bill. We're not really sure where that's going to fall out. And then, you know, you essentially are looking forward to the tariff issue where, you know, companies are now saying it's not going to be as bad as we think it is.

So we'll see kind of where that goes as well. So I think all that said, and you have a potential of lower interest rates going down. You know, the other thing I think today, if you notice, oils come down again. So that, you know, if we were talking two, three days ago, it would be like, wait, are we going to 110 bucks? Are we going to 90 bucks? That is a big governor of the stock market. So all those things that kind of, you probably have a lot of short squeeze going on today, too, just in terms of, hey, it's not as bad as it is. Self-inflicted wounds are the worst kind, but they're very common, and let's hope there will be no more. Yes. I know you're with us

the whole hour. Surat, thank you. Matt, thank you. Thank you. All right, another reason that stocks may be popping again is something Sarat just said. Oil. Oil is actually dropping again. After a big drop on Monday, crude crumbling another, what, 6% right now? Really, there are two reasons. Number one, markets are betting on the fact that the worst may be over between Israel, the U.S. and Iran. Number two, there is a lot of oil still flowing in the world, despite all the headlines and higher insurance and shipping costs, the Persian Gulf and the Strait of Hormuz, still full of oil. Look at that. shot from marine traffic.com, every one of those red dots, red arrows, is a crude oil or LNG tanker. And the number of ships in this fairly small body of water may determine everything

when it comes to oil prices. Joining us down from the Center for Strategic and International Studies, Senior Fellow for Energy Security Clay Siegel. Was that an overstatement, Clay to say that what we just showed our viewers, which is a bunch of red arrows, each one representing by way, a ship. The number of ships in that body of water is probably going to determine the path of oil and natural gas prices. Hey, guys. Good afternoon. Good to be with you. I think that the illustration that you showed basically illustrates a success story when it comes to energy security, and particularly with regard to the safety of energy commodity exports that reach customers all around the world

from this very important origin region, which is the Middle East Gulf. That, picture that you're showing there could have far fewer icons representing those tankers departing the area if we had seen a total closure of the Strait of Hormuz. But I told you guys last week, the prevailing philosophy in the oil market has been, oh no, the oil halt never occurs. So far, they've been right, and we've seen those flows continuing. I don't think that the risk is completely off the table of lesser types of disruptions that could still impact supply demand balances, depending on what we see next out of Iran and the region. But the big worry about a total cessation of flows was overstated, I think,

because the only chance that Iran would try a move like that is if its own exports had already been halted, let's say by an Israeli bombing, a United States bombing. And if that was basically not in the cards, then a total shutoff wasn't either. Since Surrout, our guest last hour, Kevin Book, suggested that we could be oversupplied by a million, a million and a half barrels the next couple of years. So energy investors who have, you know, been looking for one break after night and gotten none of them are now facing this situation where what do they do now? Look, I think energy is a tough one in terms of long-term durability. We go back to kind of what's going to have future cash flows. Russia's pumping.

You've got, you know, the Middle East pumping. We are self-sufficient. So I do think you have to pick your spots carefully. You should still have a little bit of energy in your portfolio, but I think it's more the services side, the Schombardes, the technology part of it. But the big oils are going to be hard to own for the next three to five years. To your point, oil, there's so much supply, and you have a global disruption. We've got two wars going on, and you've got oil at $60.

So it just tells you that when things are normal, and if the economy picks up and there's enough supply oil, that's going to be really good for companies. It's going to be really good for consumers as well. It does, Clay, make you wonder if the world truly did achieve peace. I don't know what that looks like. Let's all hope for it. Not sure we've ever had it. But if we get it, would oil prices be at 45, 50 bucks a barrel?

It seems like that's where the market keeps wanting to push the price. Hmm. World peace with all supply disruptions permanently off the table. Interesting concept. Not sure it's the world that we live in. Or ever will. Let's focus on the Gulf for a second. because we're at a really important inflection point still.

And I'm keeping a really close eye this week on what is the outcome for the Iranian government and this regime that has ruled this country since 1979. And I think that President Trump was correct to point out earlier today that instability breeds chaos, and that might not be the best thing for energy security. Listen, I'm not suggesting we award any medals to this regime. The president was also right last week and calling them out, they've contributed to the murder of thousands of Americans and should be held to account. But both things can be true. Chaos in Iran could give us medium to long term concerns about energy security from this important part of the world. And chaos is probably not an ingredient that we want in the mix right now.

The president has been guiding toward a target of lower oil prices, which he believes will be conducive to better macroeconomic performance. And so that does not go along with future supply shocks. You would want stability there. Yeah. I think you're right. Clay Siegel, CSIS. Thank you very much. The idea being, guys, that that map from MarineTraffic.com and Kipler,

I think that probably determines the path of oil prices, which may determine the path of equity prices. So every day we're going to look at that number of red arrows. That thing right there. The consumer, politics. I mean, you're right. A lot hangs on the, Not the red wheelbarrow, but those red little ships out there on that graphic.

You're absolutely right. And it's very active and very much a scene of normality. And they're all shaped the same exact. And they're very big. Large red arrows. They point different directions. They're going in different directions. But that's what we have to watch, Kelly.

Who's coming out? After the break, this volatility in the oil market only strengthening the case for some investors to pivot and bet on nuclear. And they're starting to bet big, but will it pay off? Plus, we've got plenty more on the menu. Stick around. Power Lunch. We'll be right back. Welcome back. We have a news alert from Washington with the Treasury Secretary making some comments. Emily Wilkins has that for us, Emily.

Hey, Kelly. Well, yeah, Treasury Secretary Scott Besson just wrapped up a lunch meeting with Senate Republicans where he put the pressure on them to make sure that they are moving through Trump's mega bill and that tax package as soon as this week. There are still a lot of discussion and debates around the bill, but of course Trump wants it on his desk by July 4th, which means it needs to not only get through the Senate, then again back through the House. Besson said that in addition to that bill being on track and being confident about its ability to pass the Senate, he also emphasized that this bill needs to move quickly because it, of course, includes that increase in the debt ceiling and that ex-state, the day the U.S. hits the debt ceiling,

can't pay its debts in full, is coming up. And he warned it could be even faster depending on what happens with Trump's tariffs. Listen to what he told reporters. The only thing that would change it would be the courts interfering and the president's right to set the trade agenda because we would have to refund this very substantial tariff income that if IEPO, the use of IEPO were overruled. Senators are hoping that to get closer to and agreed upon bill by this week, their meeting with Bessent was only one of the ways that the White House is putting pressure on them. Trump also posted on truth social today that senators and House members needed to stay in D.C. and get the job done so he could sign a bill by that July 4th deadline.

But of course, still a lot of debates, still a lot of unknowns, and still a ways to go on this final package. Kelly? Can you imagine if we had to refund this a tear of money after all that? I know that's not on the docket right now, but as this makes its way through the courts, Emily, thanks. Appreciate it. Emily Wilkins with the very latest. All right now, let's talk about energy, a different.

form and power because just four short years ago, New York State did something that many had wanted done for years. It shut down the Indian Point nuclear power plant. Many cheered the move, saying the nuclear facility was too old and it was too close to New York City's massive population. But that closure left a massive hole in New York's power generation. So the state filled the gap by adding power from three gas-powered power plants. But now the state is apparently flip-flopping again, with reports the governor is pushing for a new nuclear plant to refill some of these power needs. Folks, if you're having trouble keeping up, don't worry, so are we. But the bottom line is that nuclear and its stocks are having a big, big moment. Let's talk about how long that may last

with Mark Nelson. He's the founder and managing director of Radiant Energy Group. He was on the nuclear story, Mark, before it was even cool again. So we're glad that you're back on the program. Listen, you're not a markets guy. We do the market stuff. Nuclear is having a moment. A lot of these stocks are soaring. What is the real state of nuclear in America right now? Well, from the public, we have a lot of love. From investors, we have a lot of love. That's what you just mentioned. Utilities now realize they want more nuclear and customers of those utilities. Big tech, they just suddenly realized they want abundance of nuclear. The Democrats now realize, like in New York, They want nuclear, so they've stopped dripping it down and they want to start building it. Republicans, they still want nuclear. So the question is, where is our nuclear fleet? China is building 10 gigawatts a year coming up.

New York wants one in 10 years. If you're doing the math, that's a 100 times gap between New York and China. Now, there's a big country out here. It's not just New York, but we don't yet have an answer to China. So to answer your question, where's the next nuclear coming from? it's from whoever puts together the magic team. What's the magic team? You've got to have nuclear technology that you know works.

You've got to have a team of people experience a building who want to build big and want to build fast. You need finance industry ready to pour billions into it. It's a great deal long term if you can find an investable power plant project. You may need utilities that have those precious nuclear plant sites where the locals already want a massive expansion of nuclear. And then finally, you've got to have some. bring it all together. That's the super team we're waiting for here in the West and here in America.

And I think to continue with your team's analogy, we'll stick with sports. I think the general managers, i.e. the power companies, have decided it's better to go out and trade for an existing player, i.e. restart three-mile island. Restart that one. What is it? Dwayne Howard or whatever it's called in Iowa. Buy power from the Talon Energy Group. If you're Amazon in Ohio, restart palisades in Michigan than to build or draft a new player because as we learned in Georgia, the Vodal Energy Plant took forever and was like three X over budget. You couldn't be more correct. At the moment, the demand is such that anybody that's got a spare nuclear plant to finish or restart is getting a lot of play, a lot of inquiries, and those deals

are coming together. But what we don't have is the next fleet. In my opinion, whoever puts together the most compelling team, the quickest, likely by the end of this calendar year, is going to be out in front announcing more builds. There's support in Congress. There's an understanding that we've got to back our team or we're going to be just cooked on the AI race. I think it's going to come, but it's a lot of hard work between now and then, Brian. Mark, why can't we just restart Indian Point, the New York plant that was shut down? Or to Hogle's point, is it just that these new tax incentives are so attractive that it's more economical to build a new one than to restart an old one. Look, there's a lot of places where you can restart nuclear plants pretty easily.

Germany is one, but they're very slow and careful about how they dismantle. I heard stories out at Indian Point where people were ripping things apart inside that reactor immediately. They got rid of almost all the workers immediately. The intent apparently was to do such serious damage that by the time New York realized that they were so out of luck, it would be too hard to reverse. That's insane. I mean, there's some talk about maybe. Is that, I mean, what was the point?

Why, why be that destructive? Well, they knew there'd be a massive power jump and costs. Like, those nuclear plants were the best located power plants, arguably, in America, for providing cheap power to an urban area that needed it. But that was turned around as a negative, saying it's too close to New York City. Everybody knew, who knew markets for power, at least, knew there'd be a huge cost jump. The second you shut those down, so, it meant that there'd be a huge political price to pay if somebody could try to pin that on

Governor Cuomo and get that plant restarted. It's my opinion. I don't have a conspiracy theory I've uncovered that the intent was to damage the plant so fast that it couldn't come back, like Dwayne Arnold in Iowa or Three Mile Island in Pennsylvania. Fascinating. I think it called it Dwayne Howard, who's a basketball player. I had to basketball and not Dwayne. Thank you. Wayne Arnold, not Dwayne Howard or Dwayne Wayne, who was in a TV show. Mark Nelson, a good conversation, a serious topic. Mark, we really appreciate your views, Radiant Energy Group.

Sarat, listen, you know what I'm saying, though. So we've got to be careful because there's a lot of, I don't say startup nuclear companies, but there's a lot of startup nuclear companies. Not all of them will be successful. Well, I think you have a couple of things here, not to be kind of throwing, you know, cold water on all this. But firstly, you would actually be steam in a turbine generated from a nuclear fusion reactor. So firstly, you have to have scale, right?

You can't just do three or four of these because the startup costs and all this are huge. So that goes to the second point, which is not in my backyard. These are already places that we've had facilities in, and you were just talking about what happened when they took them down. But who's going to go out and say, I'm in the middle of XYZ County and say, we're going to build a nuclear reactor. And the families that just bought their houses and are raising their kids or their farms out there, unless the government comes in and says, guess what, like we're building roads, you know, this is where it's going to go. So I think that part's going to be very interesting to do.

Now, if we can get through it, it would be great because it would make us so much better in terms of energy. But I don't know, those are things that when I think about. You'd have to know, okay, the small modular reactors are going to be the future and this is going to work. But this, to my understanding, has yet to be built anywhere. Is that right? SMRs have never been built. They're not, they don't exist. A lot of these micro reactors

I hope they work and I hope they exist. Right. But let's right now. And the bottle plant wasn't that like $20 billion in 20 years in the making or something insane? Like 20 billion like over budget. I think it was supposed to be 10 and came in like 30. I know Pippa was down there.

Wow. Yeah, that's not good. And that scares people off, but hopefully we learn something from that, I hope. And then don't forget telephone polls. Remember when people had telephone polls and they don't want to build homes next to it? They want to, you know, so you've got to, there's a lot that we have to still work through. But I think it could be... Skeptical that it can be really be done quickly

and in a big scale. Exactly. I mean, that's the thing. It's not as, you know... Don't wind because it's ugly. Don't want nuclear because it's dangerous. Yeah. Don't want gas because it pollutes.

Which all points back to. Power bills are going up. So how do we make... And it's 102 degrees here and everybody's cranking the air conditioning. I'm just throwing it out there, folks. Where's the power coming from? Nobody wants to do anything.

Right. But everybody wants to stay cool in the summer. And use chat, and warm. And by the way, run data centers so that, you know, Kelly Evans and Eric can do it. Discussive anthropic or chat TPT or perplexity is better than Gemini. Kelly's tried every single one. So I just named as many as I could.

She knows all of them. I'm single-handly contributing to the power shortage of this country, I think. As we discuss New York State as betting on nuclear to hopefully bring down utility costs, but it's known for being one of the most expensive places to live. How expensive is it actually? that answer is coming up. And before the break, check out what's leading and lagging the S&P. And that's Coinbase up 12% today. Oxy down about four. We'll be right back. All right. It seems like a good day for an RBI. Today, let's talk about housing costs because

people around these parts know that housing costs in New York City are sky high. The rent, some might say, is too darn high. But did you know that New York is actually sort of a bargain compared to some other global cities? Deutsche Bank put out this data this morning. Deutsche Bank It shows that from a size perspective, price per square meter, New York City is actually just the seventh most expensive housing market in the world. Kelly, according to Deutsche Bank's data, the most expensive city by square meter is Hong Kong. Next up, the Swiss city of Zurich, followed by Singapore, Seoul, Geneva, another Swiss city, and your former hometown, London, Tel Aviv, Israel, Beijing, and Shanghai,

rounding it out in Hong Kong, Kelly, cost more than 25,000 U.S. dollars per square meter to buy a place. It's a very tall buildings. We'll see what happens after today's New York City primary. New York might be rising in that list. There's a mayoral primary today if a lot of people don't realize and one of the candidates, who's very charismatic, by the way, young, charismatic, probably will win the primary today. I will see.

I don't know. Promising a lot of free stuff. Well, and by the way, the cost of housing, rent, obviously, being more to the constituency for Zoran Rumb. is one of his, you know, tent polls on the campaign trail. So it's funny to put that into perspective on a day like this where it's like literally issue number one, but also raises all the questions of why is it so high and what would really fix. And some people have suggested it will fall because people will leave.

Yeah. Who knows? Everybody panics. We'll see what happens. Indeed. Let's get to Pippa Stevens now for the CNBC News Update. Pippa. Hey, Kelly.

The prosecution just rested in the Sean Diddy Colmes sex trafficking trial, ending six weeks of testimony against the hip-hop mogul. who is accused of trafficking and a racketeering conspiracy. The defense case is expected to wrap up its side of the case this week. Combs pleaded not guilty to all charges and remains in federal lockup as the trial continues. A federal judge has ruled that AI startup anthropics use of books without permission to train its large language model named Claude was legal under U.S. copyright law. But the judge also ruled the company violated the author's copyrights when it stored the books in a central.

Library. And the first tropical storm of the Atlantic hurricane season has formed. The National Hurricane Center said today, the storm named Andrea, is forecast to weaken tonight and dissipate tomorrow night. The storm comes as a heat dome continues to sit over the eastern half of the U.S., delivering triple-digit highs and humid conditions from Florida to Massachusetts. Kelly, back to you. Don't remind us. Yeah, exactly. Pippa thanks. Are you in a turtleneck, Pippa? You know what? It's cold in here. But once I step outside. Get you a heat umbrella for that trip back to the car.

Pippa Stevens. Still to come, crypto had a volatile week, dipping below $100,000 briefly when the U.S. bombed Iran. The question is why. What does that tell us about crypto as an asset class? We'll explore that in Market Navigator next. All right, welcome back to Power Lunch.

And today's Market Navigator, where we're taking a look at crypto prices, specifically the impact, if any, that the conflict in the Middle East, is having on the cryptocurrency. Now, Bitcoin did sell off when tensions heated up between Israel and Iran, but then bounced back when a ceasefire was announced, acting like a risk asset, like a stock. Still, though, Bitcoin is up 12% for the year. It's basically flat for the month of June. So here to help us navigate and make sense of all of it is Todd Gordon, founder of Inside Edge Capital.

Todd, you know, Kelly, Brian and I were talking about this idea that Bitcoin, which has been viewed as a kind of counter asset or a safe haven asset at certain times, a risk asset at other times. What exactly is the defining characteristic of what Bitcoin is like or how it's been behaving at least over the last couple of weeks? Hey, Dom, yeah, it's kind of weird. The joke I was setting up with the producer is it's kind of like an awkward teenager of finding it's his or her place in the world. It doesn't know if it's a safe haven or risk on.

And if you just look at the charts, Dom, it's very much still correlated to the growth trade to the NASDAQ, you know, but however, it's like it's earning list, it's yieldless, but it's still a growth trade, right? So, you know, I look back to the last month or so. The NASDAQ is at all-time highs right now. It should be a leading indicator of Bitcoin breaking out. However, if you look at like April and May, Bitcoin first made the move up. NASDAQ didn't as the war was starting to heat up. Now maybe Bitcoin is going to do a little bit of a little bit of a catch-up. I also think regulatory is an overhang here. You know, there's uncertainty from U.S. lawmakers in the SEC. I think there's cooling demand for the Bitcoin

ETF that came out so explosively. I think Fed policy, the idea that it's higher for longer is kind weighing on Bitcoin and finally macro, which is a much bigger conversation. Dom, you've got to look back to the early Gulf wars when, you know, when missiles unfortunately started coming out of the U.S. is when oil sold off, equities rallied. And there's a little bit of that dynamic combined with what I said in the first three reasons, where I think, Bitcoin catches up. I hold it. I have a couple three percent positions on our growth portfolios. So I think right now it's a catch-up trade, but it still doesn't know its place in the world. All right. One more question before we let you go here. Bitcoin and cryptocurrencies at large

viewed as a kind of counterplay against fiat currencies. How much is Fed policy going forward going to affect Bitcoin and its worth? That's the biggest question. I mean, we have rates that are just sideways. We have higher for longer. Real rates are two, two and a quarter. I just think we need more of a growth trade breakout to pull Bitcoin up. Again, I think it's too hard of a question to answer right now. Unfortunately, Dom, it's still defining itself. All right, the range over the last couple of months has been 100,000 on the downside, 111 or so on the upside. So we'll see if that ban gets broken out. Todd Gordon, Inside Edge Capital, thank you guys very much for that. And Brian, Kelly, I'll send it back over to you. Dom, thank you very much. All right up next, both the long and the short

For the stock market, your next guest has new data on what stocks investors love and the ones they love to hate. And by the way, as we had to break, dollar stores, they're not getting any love today. Dollar tree and dollar general, both worth like 98 cents today. We're back after this. Welcome back as markets race back towards all-time highs. All three major averages searching more than 1%. Even the small caps are up 1.5% today.

Our next guest firm takes a look at thousands of companies to give clients, proprietary daily data on short interest, weekly updates on the long side. Point is to use all of that information to understand whether the names they're in or thinking about getting in are skewed more to the long or short side. Joining us now is S3 Partners, founder and managing director, Bob Sloan, along with Sarat SETI, who is still here with us all hour long. So Bob, we've got a couple of earnings coming up. We've got FedEx tonight.

We've got Micron tomorrow. I think we've got Nike coming up. Anything you can kind of look at and tell us how you think those stocks might perform? Well, we don't have a really a call on those stocks. You know, we do make individual calls sometimes because we think there's a tremendous correlation between short interest and some price action on some stocks, but we don't see anything for those stocks. And there's no call on those stocks for us.

Understood. What about the market, broadly speaking? Stratt and I were just talking about this, but we're pretty much back at all-time high. So does that mean that, you know, being short was a horrible idea or that this is the time precisely to think about getting shorter, having at least a hedge position? I think what really is what's on the other side. So investors need to avoid stocks where the long, the active long, the actively managed long, and the short position are about equal.

That is risk you are not paid to take. And the reason is because if you look at a portfolio of stocks that are battleground, equal amount of long, equal amount of short, those portfolios perform terribly. They are 65% drawdown and their volatility is like 50%. So, you know, a dollar of risk gets actually zero reward. It's like negative reward. So identifying where there's a battleground, like Archer, like Coles, like C3 AI, those stocks are very risky. And if you have them in your portfolio, you should really think twice of being in it.

So what about the other side, Bob? What do you see in terms of maybe even sectors or some stocks that are very high on the short interest that could be very volatile coming into earnings or just in the next couple quarters? Yeah, Rivian, Super Micro, that's the other side, right? Where you have short interest way bigger than the long. they're skewed short.

Any negative news, you're going to see those stocks fall out of bed. No question. And in terms of energy, we were talking about energy quite a bit on the show. What are you seeing in that sector? Anything specific there? I know you guys have published some stuff in the past. So that could be a very interesting area also to provide quite a bit of volatility. Sure. Absolutely right.

You're seeing increased short interest in the energy sector, people are betting on a fallen energy prices, which is interesting. But that was pre-actually any ceasefire, pre-any attack on Iran, pre-Israel attack on Iran, pre-actually, you know, anything happening in the geopolitical space. So people have been shorting oil for, you know, for oil-related companies for quite a while. And look at Apache, for example. That is set up for a short squeeze, very high, hard-to-borrow cost, super high short interest. But, you know, as the stock falls, shorts are going to make money. If the stock rises, you're going to see a tremendous short squeeze there. That's one we've always been had our eye on. All right. Bob, appreciate your point of view today.

Bring you back, Bob Sloan of S3 partners. And speaking of Archer Aviation, don't miss our exclusive interview with the founder and CEO Adam Goldstein that will be tomorrow at 1 p.m. on the exchange. All right. After the break, cutting hymns loose yesterday, we talked about a brewing fight in a farmer's space. Well, your next guest has been raising the red flag on Hymns for a month. Months, turb on Hems. But first, let's check out the chip stocks. They're all higher today. Signs the AI buildout still going strong.

AMD, Vida, Intel, all up 2 to 7%. We're back right after this. Your next guest warned you about a red hot stock a few months ago, but only if you listened. And then on Monday, Hems and hers, crashed, tanking 30% after Novo Nordisk accused the company of deceptive marketing. Hems and HERS, of course, denies it. You guys talked about it on 1 o'clock show, Kelly. But let's find out what Herb Greenberg may have seen than others didn't.

Herb, of course, a CNBC contributor. He raised a red flag on Hymns back in February, and he joins us now on the Herb hotline, as we're not going to call it by phone, to discuss Herb. We don't know where this is going to go, and Hems and HERS says nothing went wrong. What did you see or thought you saw back in February? Well, Brian, I consider him as one of these stocks. I put in a bucket called the smug and the senseless because a bunch of smug investors buy it and they bid it up and they're really senseless.

And these rises are senseless. What I saw not just in February, but I actually started red flagging it back in May of 24. Stock has doubled since then. But the risk still exists and there's no change in that. And that is a company that has been very dependent on really erective. dysfunction in baldness drugs. That's its core business. And then the weight loss drugs came in.

And that became a plum. And the company was operating through a loophole that the FDA had that. Hold on. Hold on. Let's take it. Back it up. Back it up. Because those three things are fairly prevalent in America.

Okay? Okay. Obesity. E.D. baldness. There's probably some relationship between, I don't know. But those aren't problems that are going away. And on a serious note, those are problems that are

a lot of people really want to solve her. It's not solving. You can get those drugs. Look, you could always do things like at ED drugs from Mark Cuban for so much less or something like that. It's not, those are not things you can't get. It's that people are embarrassed to go to the doctor and get treated for it. And so they can go here. They can do a telemedicine. Telemedicine's very real. What Hems has done is very real. But the real question is the compounding of weight lost drugs. And the bottom line is that's the core. That is over 50% of their business. right now, and that is operating in a gray area of compounding a patented drug by personalizing

it. That's the gray area with micro doses, letting people microdose. That is the gray area here, and that's what Novo Nordisk is upset about. And the issue here is what happens if that goes away or is greatly diminished? What is happening then to its core business? And the core business, by all accounts, has been declining or decelerating. So that is. something you must do as you respect the risk associated with the stock that has been squeezed to high heaven. And as I like to say, live by the squeeze, die by the squeeze. And even the technical chartists didn't see this one coming because as is often the case with these, it's an out-of-left-field surprise. And in this case, it was a surprise by Nova Nordisk that just a month ago did a collaborative

deal with the company and now it's turning around. So that is a. is a big risk, Brian. You said it, you said it well. Herb Greenberg on the Herb hotline. Herb, thank you. Anytime. Anytime, Brian. Got to get them to flag the next one.

Coming up, there's big money in keeping people healthy. And the same goes for pets, different issues, and maybe not baldness. Is it time for Chewy to take a bite of the vet business? Power lunch, you'll be right back. Before we go, we were just talking about how Hymns shares down 30% this week. Well, the other direction this year has been Chewy. Morgan Stanley is out with a note this morning, reiterating or naming Chui a top pick. They say they're poised now to be a big player in the vet clinic space where parents spend

pet parents $40 billion a year for vet services. Chewy shares are up about 30% year-to-date, 60% in the past year. Are you a pet owner or I am not? But this is a great place to invest the demographics and the long term, again, the word durability of investing in pets, pet food, pet medicine is going to be. one of the things you want to be invested. I have two dogs. Yeah. I spend more on the dogs than on my kids at this point because the kennel requires them to have all these vaccinations now that are hundreds of dollars. This is not like I'm buying the state. Is that covered by pet insurance?

I don't have it, but I'm thinking about getting it because I'm not joking. Yeah, but there's not that much pet insurance either. So it's like, you know, a dentist, right? These are things that are not covered and people will spend. Pet dentist? But people will spend whatever they need to spend. So you're not going to say had those little dogs in like a purse on the plane. My dogs wouldn't fit. Serat, great stuff. Yeah, thank you so much for joining us all out long. And thanks everybody for watching Power Lunch. Dows up 532 points.

New record high for the NASDAQ.