Power Lunch - Stocks bounce back after Friday sell-off 10/13/25

Episode Date: October 13, 2025

Stocks rally across the board after a big sell-off on Friday. We take a look at OpenAI's newest partnership with Broadcom.  And what should investors be looking for during this earnings season? Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

And the buyers, they are back. There's green all over the screen today following Friday selloff. Welcome to Power Lunch. I'm Brian Sullivan. I'm in there somewhere. Hi. Vaughn markets are closed today for the Columbus Day, Indigenous People's Day holiday. The Dow is up nearly 600 points.

A lot of that optimism coming from the president. The NASDAQ up over 2%. Trump posting on true social yesterday. Don't worry about China. It will all be fine. Don't know what that means. but it reversed what we saw on Friday that caused the market to go down. We're up not as much as we lost Friday, but close.

New Market milestone market watcher Ryan Dietrich says at the fourth year of the bull market today. Historically, the fourth year of a bull market, stocks go up double digits, and they are higher six times out of the seven. They have started year four of a bull market. By the way, I guess happy birthday. Today is the fourth anniversary or the start of the fourth year of that bull market. There's a lot to do on this Monday, but let's begin with the markets. Making a big rebound from Friday's sell-off, thanks to some positive rhetoric from the president about China.

The S&P 500 on pace to snap a five-month winning streak as of today. But guess what, folks? October, historically a very kind month to you, the investor. Call this an RBI. According to bespoke investment research, October is the best month on record for the S&P 500 going back 50 years. That's in terms of average daily percent gain. Look at that chart. October, the kindness month to you.

But it is a key week on tap for your money. Earning season starting to kick off. Let's talk about it all. Dryden Pence, C-I-O Pence Capital Management. joining us now on set. Better to be here today than on Friday, Dryden. Absolutely. Besides that social media post, do we know what changed?

Or maybe that was enough? Well, I think that is probably enough. But, I mean, the fact of the matter is, is that China, we are 2.3% of China's GDP. They're trade with us. They're only about 0.5% of ours. They need us more than we need them. And so you had this posting going back and forth. Everybody's the frazzled cat right now in the markets at a time.

So you get any kind of noise freaks everybody out, puts them upside down on the ceiling. So it was an overreaction to this. And then Trump comes back on and really states the fact that everybody knows. China needs us more than we need them. They're going to have to come to the table with something. They don't trade with us. They go into recession. And that's the last thing Chi wants.

So I think that we're in a much stronger position. I think he stated that. Everybody stated that. This settles that. Okay, fair enough. But doesn't Friday's move indicate to you, Dryden, how jumpy this market could be? Oh, exactly.

Like I said, the frazzled cat. Any kind of, you're at a top, and everybody's worried about it, even though earnings are at an all-time high, so the market should be at an all-time high. And they're going forward. But still, when you see this, I've been doing this for a long time,

when you see these moments, any kind of news tends to create overreaction, both to the positive and to the negative, either on a stock by stock or whole index basis. So we just have to kind of take everything with a big grain of salt. Okay. Earnings growth, to your point, has been better than expected. But it's a new now earnings period.

We're entering the fourth quarter, third quarter earnings about to roll out. You can see for the giant beautiful wall we made behind you that there's all kinds of major companies coming out. That's this week. More next week. What does Dryden Pence? I love referring to people in the third person. What do you want to see from this earnings season? What would make you happy as an investor?

I think we continue to see. Last time we about 82% of the companies were beating, I think we're going to see that the same. Everybody lowered their earnings expectations after April and things like that. So everybody's beating a low bar, but I think we're going to continue to see this push through in earnings, and it moves forward not only for this year, but into next year. So we have about a 10 to 12% on an annualized basis increase in earnings.

And if we see that, then we're going to see a market that's going to be a double-digit. Any specific places of this market that you are watching more closely than others? I think you have to watch the AI space. It has gotten to the point where it is, in some cases, maybe priced a little over. But then you've got to look at the people that are going to be winning in this no matter what. The companies that are part of the infrastructure of AI going forward, because sometimes you get, if it says AI, you want to invest in. but people that are part of the infrastructure of AI going forward,

those are the ones that are going to win during this period no matter what. We're in that infrastructure phase. But are we priced to perfection, though? Do we need every one of those companies that you just rightly said running the narrative? Okay. And look at some of these rare earth companies. We're going to talk about them a little bit later on because many of them are brand new. They have no sales, no revenue, no nothing, but they got multi-billion dollar valuations.

What do you want to see from those companies? They have to be, does NVIDIA have to be perfect? It doesn't have to be perfect, okay, because the demand signal is strong. But what it does have to do is be in a position that we can look at with predictability, some long-term growth, continued demand, continued delivery, all of those kind of things. And now, and you're seeing continued big deals made in this market. We just, you know, saw the broadcom open out. Today?

Today? Yeah. And so, and that's dramatic because now people are beginning to pay attention to Not only are we throwing a ton of money at it, but also what does it cost? What's the margin expansion? What's how we lower cost on these things? How we begin to make it more efficient across the scale. So we're trying to get some more discipline into this, and that's what I'm looking for.

Looking for that discipline as well, because we saw Friday, I think if Friday taught us anything, and also, by the way, not just Friday, I think it was January 26 or 27th, called that Deep Seek Day when China said, well, we've got this AI thing that does what your AI does. does for a lot less power. Markets wobbled, came back quickly. Tariff Liberation Day early April. Markets collapsed 20 percent, but they came back quickly. Friday, we're not gaining it all back today, but we're not far off. It shows, I think, how, I don't see, gee, you said, frazzled cat, I guess, this market is, that's got to worry you a little bit, no? Well, the point is, is I look at some of these things is opportunities.

Because if people are overreact, I mean, do you know any irrational people? And so everybody I know is irrational. Exactly. So sometimes people take this irrational activity. They overreact. That gives people that can step back, be a little calm about it, focus purely on earnings and long-term stuff, kind of step in at an opportunity moment because you can kind of pick up some of these bargains here.

And I think that that's important. What about the banks? I know there's a lot of banks coming out this week. They're kind of the first ones that really launch as a group. Keep Leslie Picker busy here at CNBC. Are you watching the banks in addition to AI? I think the short answer is we are. You're in an environment where the Fed is lowering interest rates.

We think they're going to do another cut because they don't have enough data to not to it. And so I think that we're going to be in this position that we like some of the banks, not all of them. But when we move forward as what their earnings growth are going to look like, being involved in this, environment, and I think deals are going to pick up. So you've got the guys who are both traditional banks but also the investment banking firms are going to see, I think we're going to see earnings surprises across the board. To the upside. To the upside.

The market would hope that. The market would hope that. I wonder if the market is priced that. I guess we'll find out. October tends to be a good month. Has them been the greatest start, but it's still relatively early. Dryden Pence, really glad you're here. Thank you for joining us.

Absolutely. Big Monday kicking things off. Markets are up across the board. You got a green tie on. I have a green tie on. And you have Uncle Sam. You want to show the inside of that jacket? Uncle Sam.

It's a good day for the... Look at this. The inside of that jacket. Uncle Sam. There we go. I need that jacket. We'll send you one. All right.

Dryden Pence. Thank you very much. All right. Speaking of, by the way, many of the rare earth are critical minerals and metals companies. They are soaring again today. You've seen it all day on CNBC. You can see that MP Materials, USA Rare Earth,

the metals company and Critical Medicals Corporation are all up double digits back 20% and Critical Metals Corp is up 48%. And just this month, three of them, USA Rare Earth, Critical Metals and a company called U.S. Antimony have more than doubled this month. These are, no doubt, some of the hottest trader stocks in the world. And while they often get bunched together as Rare Earth or Critical Metals companies, it is important to note, we're going to make you a little smarter. They're all very different. For example, MP Materials mines for an element for magnets called dysprosium, neodymium, and praesiodimium. We've been to their California mine twice in person, on air.

MP Materials has an estimated $289 or so million in sales this year. They have 13 cell side analysts covering them, but the others are a little more developmental or early stage. Here you go. USA Rare Earth, for example, it's focused on an early stage development of a Texas, mine called Round Top that's been around. The company was incorporated in 2019, according to FACSET. This company is going to build a magnet facility in Oklahoma that would be commissioned in the first quarter of next year. Its CEO is former Siemens USA CEO Barbara Humpton. Meantime the metals company is an ongoing or an ocean-going operation that plans to mine

nickel and cobalt and copper off the ocean floor with commercial production plan for the fourth quarter of 2027. So about two years from now. And critical metals corporation, which is up nearly 50 percent right now, is looking to find wealth in a much colder part of the world, Greenland. They have a permitted project there called Tanbreeze. That its website says is expected to supply rare earth elements to customers. These are exciting times across the entire industry. and I sent out, I tweeted out and put on LinkedIn a public service announcement this morning. If you are looking to buy real sales or earnings in some of these rare earth or critical mineral or medical companies, just be sure to check their financials.

Some of these companies have no earnings or sales. They're basically developmental stage companies. All these stocks have been red hot, investors throwing huge money at the group. But as our friend, Herb Greenberg will tell you, always know what you. you are buying. And as a reminder, if you have questions, you can always go to cnbc.com, punch in the stock ticker, go to financials, income statement, balance sheet, or the company's own website to learn more about them and their financials. No question. They've been red hot, but they're all very different. And some of them are still very early in building out

their business. All right, coming up. Stocks overall rallying in a big way following Friday's big sell off just as earning season is about to heat up, but don't worry, we're going to help you do your homework. We're the AI of financial news, and we're going to give you some key names to watch. Next. Welcome, but welcome back. Earning season really began last week with a couple of consumer staple names, a couple of airlines, but it really accelerates from here on out. As we just talked about several of the big banks they're reporting tomorrow, you got J.P. Morgan Chase, Citigroup, and Goldman Sachson, Wells Fargo, tomorrow, Wednesday, Morgan Stanley, Bank of America, and PNC, and it keeps going from there.

Now, these banks, they're going to be kind of a crucial read on both the markets and the economy. In fact, your next guest striking a bit more of a cautious tone on the market. He says the risk that stocks in the year lower is higher than you might realize. Let's find out why. And bring in Matt Maley, he is chief market strategist at Miller Taback. Matt, great to have you back on. You're a believer in this market. Reading your daily notes, which are always excellent,

I'm just not sure you're a believer in 23 times forward earnings on the S&P 500. Well, you know, no, I'm not. I mean, you know, we all know the valuation is a horrible timing tool, but they do matter eventually. And, you know, these earnings, which are good, are still very, very narrow. And we keep hearing that they're, you know, the promise of them broadening out. But boy, it just heard from last week about Oracle on their margins. It doesn't look like they're going to broaden out maybe as quickly as people have been thinking.

And not only that, I'm worried that the earnings, which again, a 9% earnings growth for this year and 13 for next year is good, but it would be a lot better if the market was trading at 16 or 17 times earnings. And those estimates have actually come down since the beginning of the year, even though they've gone up just slightly in the last couple of months. They're down on the year quite a bit. So, again, it's just something where you need to be careful about some of this euphoria in the marketplace. So you probably listened to our interview with our previous guests, Dryden Pence, and he was bullish on the market. You know, we talked about earnings. So your point, I think, if I'm hearing you right, Matt, is you think earnings are going to be good. The question is, will they be good enough to justify a 23-time forward valuation on the market, correct?

Is that summarize it fairly? Exactly, Brian. We just need that. We need it to broaden out in a big way. And, you know, it's going to be obviously very important for the tech stock. That's going to be the most important group, obviously, to see whether we get a broading out. You know, we need, yes, we need expansion on the from the hyperscalers. But we also need some of these, you know, return on investment, the ROI to finally pick up for them as well. But this week, of course, with the banks can be very interesting because, you know, even though the narrative, the narrative, on Wall Street is very bullish. I mean, talking about, you know, whether it be increasing in IPOs and M&A activity, yield curve, et cetera, that, you know, deregulation, et cetera. But, you know, the stocks have actually come down 7% over the last three weeks while the stock market has moved up slightly. So I'm worried what's going on there and is there something we should be worried about. But we'll know about that soon enough within the next two days. And that'll be a key kickoff to this earnings season.

And then obviously the AI-related companies, these are the companies that control the market, Microsoft and Nvidia, two companies, 15% of the entire value of the equity market. Matt Maley, in your entire illustrious long career, did you ever think these are like the Tom Brady and the Rob Grankowski, you're a Boston guy of the stock market. If they don't perform, nobody, the Patriots aren't winning. And I feel like we've got two or three companies that are running the entire. show. Exactly. And, you know, we need a new quarterback like the Patriots have, and we're winning again, which is great to see with Drake May. But the, yeah, I mean, the thing is that the market, if those stocks start to roll over, the Mag 7, especially those two names, the stock indices will not be able to keep from going down. I mean, it's just, they're just too heavily weighted.

And when those indices go down, people start pulling their, their money. out of the market, and that's going to be a lot harder for the rest of the market to hold up. What did Friday, we're back up today, everything's fine. Trump said, you know, China's fine, everything's fine, the markets are fine. Friday wasn't fine. Like, what did Friday teach us? Yeah, exactly. And that taught us about how quickly the worm can turn. And, you know, we've seen it in the past, it's gone so long since it's got eight months now almost that we haven't seen any kind of pullback until Friday, but it shows how fragile things can be. And again, people have been saying, hey, all this talk about a bubble that means we probably won't have one. But you also say with so

many people hearing about a bubble, if the market does start to get cracked a little bit, they might finally go, geez, I need to get out now while the getting is good. So this thing could turn very quickly. And investors need to remain very, very nimble. The last thing point I'd say, yes, October tends to be the best month, but that's usually because September is the worst month. And so, so it sees a big bounce off on all this whole lot. I'm not going to pick on any specific companies or whatever, but we just talked about some of these critical minerals and rarest companies. It's an exciting time.

I've been to the empty materials mine. They've got to, you know, they're digging stuff out of the ground en masse. We've shown it to our viewers. But there are a lot of other companies in that space that are still developmental stage, Matt. I mean, they're still putting together business plans, getting feasibility studies, getting investors in. They have no revenues. But the stocks are worth a billion, $2 billion, $3, $4.

billion dollars. I mean, is that a measure of risk that you would assign to this stock market? Because you're investing in hope. You're not necessarily investing in a specific current business. You're not buying a share of earnings because there are no earnings. Right. Exactly, Brian. And one of the things that I worry about is there's so many people saying, well, there's not that many of examples compared to what it was in 2000. Well, just because there's not that many doesn't mean it's not a big problem. We don't. I don't have to have the, you know, go back to the worst and most overvalued and biggest bubble ever for up to, you know, to unravel at some point. And, you mean, if you have five martinis, you shouldn't be driving just because the last time somebody got in an accident, they had seven martiniies doesn't mean it's okay to drive.

So we need to be very careful here. You don't have to be really aggressive with all your money. I think that's my biggest story right now. Listen, I think it's a very important just note of not caution, but just reality. You like, listen, the stock market, there's real money being wagered. There's levered ETFs. There's a lot of people using a lot of leverage in this market. And things can turn, as we learned on Friday, very quickly.

Matt Maley, Miller Tayback, glad the Patriots are good as well. Or I should say, better. Maybe not good. Virginia Tech can just turn things around will be all set. Yeah. Us in Penn State. Matt, thank you. All right.

Still ahead. Open eyes quest for global tech dominational. continues. Another multi-billion dollar deal announced today. McKenzie Sagalas will dive into all of it next. All right, welcome back and hope we're having a great Monday. We continue to track the incredible race to build out the AI infrastructure of the future. And today, we have yet another blockbuster deal in the business. Broadcom shares are soaring after making its partnership with Open AI official.

The two companies are teaming up to jointly build and deploy. employ 10 gigawatts of custom artificial intelligence accelerators. It's about 7 million homes. The deal, which has been in the works for about 18 months, sees Broadcom shares rising on that news. McKenzie Sagalos joining us now with more from San Francisco and Mac. I don't think you're a big TV consumer, but there's a show out there called like The Bachelor and like the Bachelorette, right?

And I guess they give roses to, they're dating everybody, before they finally settle on one. And I feel like OpenAI is at that point in the show where it's given roses to everybody, Broadcom, Oracle, Nvidia, AMD. Is that fair? What's different about Broadcom is that this is the first time it's getting into hardware.

So whereas with Nvidia and AMD was buying those off-the-shelf GPUs, this is the first time that it is taking an active role in designing custom-made chips for its models, specifically. And what's interesting, Brian, is that it is 30% cheaper, according to a source familiar with this deal than the Nvidia chips that it's buying. So it also gives them a cost advantage. So, okay, so what does that mean? Hardware for the first time, because I'm not only trying to make sense of all this,

and you've done a great job laying it out, but as you and I have talked about, Mac, trying to also understand, and maybe there is no clear answer to this right now, How many of these gigawatts and billions might overlay like a Venn diagram with each other, or are they all completely separate and distinct deals? Do we know? We know. And this 10 gigawatt deal announced today is additive.

That brings up the total count in the last three weeks to 33 gigawatts. And you know energy better than anyone at this network. That's 33 nuclear reactors. This is an unprecedented build. But what's different about the Broadcom deal in terms of that hardware piece is that Open AI hasn't been a chip maker today. They've talked about consumer hardware ambitions. That's why they brought Johnny I've in-house to try to build an iPhone rival that might be

a screenless consumer device, but this is totally different. And so by building its own chips, it is taking a page out of Google's playbook. Their in-house chip called the TPU has put them at a massive advantage with respect to Gemini. and that at this point is probably OpenAI's chief rival at the moment. And so having that custom silicone in-house gives you control over design, optimizes for your own models. It is less expensive, which means that you can do more with the existing budgets.

And that's what's helped Google, you know, come ahead in the race. I mean, Open AI might have been first out the gate in terms of making chat CBT synonymous in the vernacular of AI chatbots. But Google has closed that gap and thanks in large part to having Google Cloud, to having its own chip. 33 gigawatts. So as you said, it's about 33 nuclear reactors. And I mean individual reactors because you look at a three reactor plant.

That's about three gigawatts roughly. Energy is weird. So McKinsey, I don't want our viewers to come at us because there's different size power plants. 33 gigawatts would be about 100 to 200 new natural gas fired power plants or about 100 billion solar farms. that was a little bit hyperbolicistic, but you get the point, is anybody in your neck of the woods out west saying,

whoa, this is decades of work, not years, decades. Absolutely. And I've talked to Open A's head of infrastructure. This is somebody who since December has been going out to any source of, going out to people across North America, 800 different applications have come in

in order to power this unprecedented infrastructure build out. And so they're working with people that are running off of a mix of off-grid renewables, on-grid, gas turbines, nuclear power. And the point that they were making to me is that this is going to have to be a patchwork solution because there is no one answer here. And you're not going to get it just from grid power. And part of the problem is that under the Trump administration, renewables have really kind of hit this backlog where there hasn't been as much support for it. So you haven't been able to get it. as many renewables online. So that's why people are looking at spinning up old gas turbines,

other legacy grid assets in order to meet these demands. Although we don't, to be fair, that's all good points. But we don't know if these are all projects, or do we, in America? Are some of these projects potentially somewhere else? Or would these all be in the domestic United States? Because if they are, then we're talking about basically a new Texas worth of power. So the 800 applicant, so Open AI, basically. created this request for proposal at RFP. 800 applications came in from across North America. So that's not just the United States. We already know about a multi-gigawatt buildout in the Middle East in conjunction with G42. So OpenAI has opened up this Stargate brand to encompass

any sort of infrastructure build out anywhere in the world that relates to them. Because they aren't going to be able to just get it done in the U.S. Listen, however it, I don't know how it's going to end up, but it is one of the greatest and most exciting tech transformations of all time. I think that's fair to say. McKenzie Sagalos, thank you very much. Appreciate it. Thanks, Brian.

All right, speaking of AI, the biggest bank in America by assets putting its money where its mouth is. JP Morgan Chase announcing a multi-billion dollar investment in industries like AI that it deems are critical to America's security. We'll get more details coming up. All right, welcome back.

Big banks officially kicking off the real part of fourth quarter earning season this week. The biggest of them all, J.P. Morgan Chase, making a rather surprise announcement today. They're going to invest up to $10 billion in the next decade in U.S. national security by taking and financing stakes in companies in defense, aerospace, AI, and even quantum computing. It's part of the bank's broader efforts pledging $1.5 trillion to companies it sees as crucial for U.S. interests, CEO Jamie Diamond assuring the investments would be 100% commercial and are not driven by the Trump administration. With us now is CBC banking reporter Hugh Sun. Hugh, good to have you on. What is JPM doing? Yeah, I think this is a clever rebranding of stuff they were going to do

anyway, right? They're already lending to AI companies and to data centers and defense companies, and a trillion of this was going to happen anyway. They were pretty clear about that. Now, it is 1.5 trillion. It is more. So they're ramping up that. It's cloaked in this America First financing aspect, which can only endear themselves to the administration. So is there something new here? Well, it's $500 billion more than they had said they would in a previous plan. The most interesting thing about this, Brian, though, is that they're going to put $10 billion of their own money, their own balance sheet into stakes into companies. So they'll be an owner in startups and VC investing, and at the same time, they're going to try to advise other companies on this.

So there is a bit of a conflict of interest thing that I talked to Jamie Diamond about that today. And what did he say? He basically said, you know, it's all going to be disclosed, so it's not going to be a problem. Don't think, don't look at that. And in my view, look, if you're a company and you have to choose between Goldman, Morgan Stanley and J.P. Morgan, and J.P. Morgan happens to own your competitor, own a stake in your competitor. I do think that is an issue, actually. So is this effectively venture capital? And if not, what is what JPM is doing with these stake takings that would be different from venture capital?

No, it is venture. And that's the word they use. It's anywhere from venture to growth to, you know, pre-IPO companies. They're basically going to participate in the full stack of capital markets, Brian. Is this rare for banks like a JP Morgan to do that? I mean, they all have venture capital investments, I'm sure, elsewhere, funds that do it. This sounds like it's coming directly from the top. It is a little bit rare to my eyes because, you know, Goldman Sachs had a bunch of these investments. And you know what? The streak did not like that because, you know, it went up and down, depending on the market. It was hard to look into it. It was a little opaque. So Goldman Sachs has been getting out of that business. They've been selling their stakes in a lot of these private companies.

Now, J.P. Morgan, far bigger balance sheet, 10 billions of drop in the bucket. It is, however, interesting. Is this kind of tracking with what the U.S. government is doing by taking stakes or talking about taking stakes in certain critical companies? Clearly, that's what we're doing now, Brian, is that, yeah, that the government is taking stakes in companies. And it's not really been done except in the time. of like financial crisis, things like that. So we are in uncharted waters in that, in that perspective. Well, you're not going to sleep for like the next, I don't know, 72 hours, right, 96 hours with all, we got this giant wall of earnings. I mean, there's about 20 big

banks reporting or financial firms reporting this week. What's key that you're going to be focusing on? Well, look, I'll take it back to the second quarter. And JP Morgan's CFO basically told me that, Hugh, we're running on all cylinders right now. We're firing. on Wall Street, investment banking, we're firing on trading, and by the way, the consumer is holding up well. And all of those trends have played through. So basically, you know, investment banking, IPO markets, that's on fire, mergers, that's doing really well, right? And at the same time, trading is up, you know, according to J.P. Morgan, something like 19 or 18 percent in the quarter. So the Wall Street side of the business is going gangbusters. That will be a source of the beat.

So some of these companies will beat in this quarter because of that. And on the other side of the main street side of the business, you know, they have to disclose their credit card metrics, the Master Trust data, these AKFilings, they're doing well. So the consumer is still repaying their loans and is still, you know, up to date essentially, because it's being driven in part by the wealth effect, Brian. In other words, the stock market at all-time highs is making people feel pretty flush. And it's being driven by, you know, the higher end of the segment, you know, basically paying their bills on time. Speaking of higher end, have you happened to, I have not. Have you been into JPMorgan's new headquarters?

JPM, if you're not aware of folks in New York City built what is arguably one of the nicest office buildings in the world. I have not been inside it. Jamie, if you're out there, give us all a tour, we'll come by. But it's, you wonder, that's a bullish, and I only bring this up because building a building like that in New York City, that itself is a sign of your confidence, not only in the global economy, the American economy, but also New York City, it's a bullish sign. think from Jamie Diamond and company.

And Brian, it's not even just that building. It's sort of a campus. It's a little campus, right? They have a gym and a bunch of juice bars. But also adjacent building around there. They realize they don't even have enough space for their aspirations as it is right now. So they're taking space in other buildings, you know, across the street and around their area. So it's sort of a neighborhood of JP Morgan.

Almost like watch what I do, not what I say, even though they're saying optimistic things. You get my broader point, which is when a company invests that kind of money into this type of project, folks, you can Google it online or Bing it, whatever. chat GPT it. It's a pretty amazing sign of optimism, I think, from Jamie Diamond. Here's a metric that is, it kind of blows my mind, is that last quarter, J.P. Morgan, made almost as much profit as the next three banks combined. What? Yeah.

We could have led with that. It's like an RBI, random but interesting. How is that possible? I buried the lead, right? How is that possible? Because every time there's a crisis, they end up acquiring another couple of banks. And so they're huge compared to relative to second, third, and fourth player. Wow.

Not quite bearing the lead, but it's an interesting way to end it. How about that? We've got a brand new office building in Manhattan campus in Manhattan. Hugh's son's not going to sleep for the next four days, but we appreciate your time, Hugh. Thank you very much. All right, let's get now to Kate Rogers for a CNBC news update. On the Gaza ceasefire deal today during an international summit with more than 20 world leaders in Egypt. He said it would spell out the rules and regulations, but neither Hamas or Israel,

was present. The president's Egyptian, Turkish, and Qatari counterparts also signed the document. A video of Homeland Security Secretary Christy Noem blaming Democrats for the government shutdown is rolling out at TSA checkpoints across the country. In it, she claims Democrats refuse to fund the government and because of that, most TSA employees are working without pay. Some airports say they won't display the video, including Seattle-Tacoma Airport and Portland International. And Apple is rebranding its streaming service. by simply dropping the plus sign. It's not clear when the service will officially become Apple TV.

The company announced the change today buried in a press release for Apple's Blockbuster F1 movie, which will premiere on the service on December 12th. Brian, back over to you. That's confusing, Kate, because the physical box and I use it at home is called the Apple TV, and the service is the plus. Plus, but no more plus, so less confusing for you. I guess because now I got to refer to the box as Apple TV minus. There you go.

Dad joke. Kate Rogers, thank you. Thank you. I thought it was funny. Fill ahead why Friday sell-off is not deterring the retail investor at all where they're looking for some next big gains. Let's see Power Lensh Plus. All right, welcome back. It is a big Monday in the stock market.

You remember Friday we had a big day in a different way, big sell-off, three-day, three-day, 3% decline for the NASDAQ, worst date for stocks since all the way back in April when the tariffs were announced. But today, reversal were higher across the board. Volatility certainly is picked up in the last month. And your next guest says, data on you. The retail investors suggest no big rush for protection or hedging. Huh. Dungeon Banerjee is the lead writer for Markets Live at the Wall Street Journal, CNBC contributor.

Does this mean people aren't nervous? Hello, by the way. Hello, Brian. It does not look like people are very nervous. In fact, a lot of them are buying the dip, as we can see with the big rebound today. And it's been a record year for this very popular buy the dip trade. S&P 500 has rebounded around 2% after one day drops of that much this year. That makes it the best year for the buy the dip trade since 2019. And the second best year since the 1980s. Those are incredible stats. I mean, going back to my time, the 1980s. And it's, we saw it in Deep Seek Day in January.

We saw it again with tariff liberation. That took a couple days, but the markets came roaring back. We saw it again from Friday, IE, today. Who are these people? Do we know why they're buying? Well, I think they've seen that this trade has worked. You know, as you mentioned, we have not seen that much volatility this year, but every time we have, people have plowed money into the markets.

And what's really remarkable is that I do think that this recent leg of the rally has been driven by Americans of many different income levels and of many different ages. As the journal recently reported, 25-year-olds, around a third of them, are in the markets today. In 2015, that figure was 6%. Was this the story I read and everything kind of gets mushed together on the weekends that I read my Apple News Plus, sorry, I was referenced the previous segment, about how people aren't buying homes in part because they're buying so much in stocks? They're putting their money into the stock market.

Not the housing market. And it's worked. Take a look at share prices, right, compared to home prices. And I think that's why Americans of all income levels are also putting money into the markets. Income levels between $30,000 and $80,000 a year. More of those Americans are in the market than ever before. And many of them have entered during this bull market. That is the true retail investor.

We want market participation. We want everybody to feel that they can access this market. You don't need to be a multimillionaire. And they feel that right. But, and here's where, there's always a but. When I see leveraged crypto trades, when I see 3x ETFs up or down, you know, I'm not sending up a warning flag. But at the same time, these are instruments where if they work, they're going to work really well. They don't work.

There is a lot more risk here, right? Talk to us about leveraged crypto. I mean, I think it's leverage across the board. I was shocked to see that leverage ETFs tied to the NASDA. that, NVIDIA saw some of their biggest inflows on record last week during this volatility. And stock investors who enter the markets on Friday are probably taking a look at their accounts and they're pretty happy right now. Crypto-leveraged traders are still nursing losses.

So to be clear, and if I'm wrong, please tell me that the leverage here is basically, it's not one-to-one. You buy a share of Nvidia, goes up, you make some money, goes down, you lose a little bit of money when you sell. These are multiples, right? Exactly. This is 10-X. borrowed money, 10x.

10x, 20x, 100x leverage. And these trades are coming to the U.S. There's not 100x leverage. Well, that's abroad. That's on offshore exchanges. But it does exist. But that exists? It exists.

100 times leverage offshore stuff. Crypto trades exist. And I would bet that U.S. exchanges and brokerages will keep amping up the leverage. On Coinbase, you can access 10x leverage on Bitcoin and Ethereum. That was for the first time over the summer. and I think they're going to keep pushing the envelope. If these crypto assets continue to go up, those people are going to make a lot of money.

Right, but take a look at what happened on Friday, right? People in these trades can also lose a lot of money, lose everything on days like Friday. I called it the get rich or get wiped out trade. Yeah, do we know how much of that leverage may contribute to sort of the more volatile declines that we see? see, right? So the stock market won't go down, you know, a quarter of a percent. It'll go down three percent. Yep. And then it comes back roaring right back. That, those extreme movements,

or at least my perception sitting here of extreme movements, has to be tied if it's real to those leveraged trades or no. Look, what I often hear from traders, especially the past few years, as we've seen the rise of options trades, one-day options trades, leveraged ETFs, right? A lot of How do these trades rebalance around the close? So a lot of traders do think that that can exacerbate volatility on big up days and big down days. Is this, you said offshore, I would imagine that there's not just U.S. retail investors buying in. I've heard a lot about investors in other places like South Korea. This is a global market, correct?

This is a global phenomenon. And you will be shocked at how much activity is taking place in these so-called perpetual futures, around 68% of Bitcoin volumes. What's a perpetual future? So these are the leverage trade. These are the crypto leverage trades that offer 10x, 20x. And those markets don't close. Is that why I'm assuming that just based on the name perpetual? They're around the clock and these are contracts that don't expire.

So you could be two in the morning in Seoul, South Korea and decide you want to wager on a leverage crypto ETF, 10 to 1, 20 to 1, 100 to 1, and you can do it. Yes, but you know what's fascinating is those trades are coming to the U.S. stock market too, right? You have 24 trading in U.S. stocks. Yes. I think we have to stop using the term after hours because I don't, but seriously, pre-market after hours, I don't think there is a pre-market or an after-hours. There's just perpetual trading on Robin Hood. It's 24-7, whatever, or almost for a lot of stocks. Gunjin Banerjee, amazing story, really important one at a global one. Gunjin, thank you very much. Thank you, Brian. All right, you're welcome. Coming up, it is not just open AI making big moves to the race for dominance.

This mystery power player, that one right there, just made a huge. move into data centers, that name shall be revealed next. All right, another big deal in the AI arms race, the stories that really continues to evolve at a breathtaking pace, and it's not just in chips and software. Today's headline highlights that the battle for computer power is also a battle for actual power. Shares of fuel cell manufacturer Bloom Energy right now, up 31%,

a record high today. All Bloom Energy is done is go up nearly one, thousand percent in a year. This is after striking a partnership with alternative asset management giant Brookfield. Brookfield's also big in energy. The agreement is an investment of up to $5 billion from Brookfield to Bloom Energy to deploy Bloom's fuel flexible technologies, basically giant batteries, in new AI factories around the world. Bloom's battery fuel cells can run on natural gas, biogas, or even hydrogen. What they say provides reliable on-site electricity for these power-hungry data centers.

The CEO Bloom Energy was on CNBC a little over two weeks ago talking about the demand for power. Here's part of what he said. Because if we just look at the hypers and their investments in the U.S., in the year 2025, it's closer to $2 billion of CAPEX every single day, weekday and weekend. all that infrastructure, all that CAPEX needs power and lots of them. And that's where we come in. CEO of Bloom Energy. All right, short break.

We're back right after this. All right, welcome back. Well, most of the market is enjoying a big day of gains. One sector is standing out in the other way. That is a consumer staples. The bastion of stability and defense trading down today. It's down about 6 tenths of 1%. Paying kind of being felt across the industry.

You got packaged food. beverages, whatever, investors today, they're getting back in what we just talked about, sort of riskier high-growth assets. Handful of household names in the sector, by the way, companies we rely on for essentials every single day, hitting new 52-week lows, Tyson Foods, Procter & Gamble, Colgate Palm Olive, General Mills, Hormel, Kimberly Clark, Kraft Hines, all down today in a market really captivated. by AI and tech innovation, sort of the slow and steady consumer staples, losing a little bit of favor. We all like chicken. We all need to use paper towels. But today, not getting much love

in that stock market. All right, before we go, we want to highlight one of the most red stories on CBC Pro right now. We just teased it a moment ago. It is silver, not gold, silver, passing the $50 mark for the first time last week, joining gold on its record run in 2025. Both have benefited from a rush to safe haven assets this year, and analysts say there's plenty more room to run. Gold and silver supplier Solomon Global, saying that not only is a bull run sustainable,

but silver could get this, double to $100 by the end of next year. It is worth noting that prior to last week, Silver had to hit a new record high since 2011 to read this story and many more like it. Go to cnbc.com slash pro. Thanks for joining us on Power Lunch. See tomorrow. Using Bell starts now.