Closing Bell 8/6/26

Thanks so much. Welcome to Closing Bell. I'm Scott Walker, live from Post-Nive right here at the New York Stock Exchange. This Make-A-Bake Hour begins with the call of the bulls who say stocks are going much higher from here. And we've got one of them on our program today. Fun Stretz, Tom Lee, he'll be here with us in just a moment. And he's far from the only one who thinks 8,000 is the next stop in this rally. So we'll discuss that and more. Coming up, let's show you the scorecard here with 60 to go in regulation. We have been read for most of the day, some weakness in tech led by a few semians. Software names today will have reports on that in just a bit. SpaceX is higher today after its lock up explorations begin. Just following earnings, we're following that of course, as well more on that soon. Thanks, they're a little weaker today after their recent run. So we're keeping our eyes on the broader market as well. Goldman's down about 2%. It does take us to our talk of the tape, the future of this rally, whether all of those bulls are too exuberant right now. Let's welcome in our panel, CNBC contributor, Fun Stretz, Tom Lee. Solace is Dan Greenhouse. We're all here at Post 9, as you can clearly see. Tom's good to have you. I'll start with you first. You say we could go 7,900 to 8,000 this month alone. So this momentum's going to continue. Yeah, I think the de-leveraging that happened a couple of weeks ago, put a lot of cash on the sidelines, got sentiment quite bearish. And then on top of people getting very skeptical of the Fed, got markets to de-risk. And now I think as earnings have been good, and I think there's a rethink of how inflation might be cooler than expected. And of course, AI's still strong. There's going to be a chase. I think that chase takes us towards 7,900 to 8,000. Most people who are putting out bullish notes cite both of the facts that you did. This major de-leveraging process, which was a reset for the market. There was no real fundamental change in anything. There was some froth that needed to be worked out. There was some leverage that got a little bit too high. And all of that needed to be worked out. And then the backbone of the whole thing, the earnings. John Waldron of Goldman was talking about that just yesterday morning. Yeah, that's exactly right. I mean, earnings this quarter is coming in more than $15 ahead of what people expected. The start of the quarter, but what's really more impressive is 2027 earnings are up now $8. So we're probably close to 410 for 2027 earnings. And we're only three weeks into earnings season. I actually think it might settle out closer to 425 by the time earnings season is over. Sound reasonable to you? And it's not just Tom, obviously. I've been hearing more 8,000 calls sort of day by day with Ed Yardini saying his 8250 could be conservative for the very reason that Tom just suggested. Earnings are just really good. Yeah, I mean, as we're seeing on the screen, the S&P is already at 7700, so 8000, no disrespect. I mean, it's not a huge risk to percentage wise. I think the implication though is that that's just the next stop on this train. Yeah, I mean, because the thing with the earnings is even if you ex out technology and you should track, say, 10 percentage points off the gross number, earnings are still good. And when you listen to it as many of us do, any number of companies in any number of industries, the AI-- >> All of them. >> Yeah, the AI story is going well from Eaton and 3M and those adjacent companies. You look at the charts of the KRE, the BKX, the financial Zürat highs, the KIE, the insurance companies Zürat highs. The commentary across the board from the card companies who I mentioned every quarter about consumer spending just fine. So you have all the investment themes going on, AI, power generation, et cetera, et cetera. The consumers doing fine. Jobs claims two weeks in a row, sub 200. For viewers out there who are not aware, under 200,000 in job claims didn't happen one time from 2000, through basically through COVID. These are exceedingly incredible numbers. And so just when you take a step back from one being bullish or bearish, the backdrop is positive. Now, the valuation argument is something we can have. You look at Sandisk and some of the movies in those names, obviously South Korea. But the fundamental backdrop is still very positive. And those, there are always going to be idiosyncratic valuation issues within any bull market. But one of the overwhelming, I think, characteristics of this particular bull market is the ability of this stock market to correct itself. To rid itself of excesses that feel uncomfortable at the time, but don't upend the story. We witnessed that a week or so ago. We had the largest crash in momentum. Then we probably, in the fastest one, then we probably have ever had. And then if you pile on top of that, a blow up in a hedge fund that's heavily levered to the AI trade. And yet the market was up three or four days consecutively following that. And we find ourselves closing at record highs. Today, obviously, notwithstanding. Yeah, there's a market structure conversation to have in here about the way the market acts and performs these days. But I think your point's exactly right. I would have been and was one of those people who would have told you six months a year ago, whatever. Well, if the Mag 7 or Sandisk and AMD dropped 20, 30, 40%, the broader market's going to be down at least five to seven percent, if not 10 to 15%. And that didn't happen. The rest of the market for lack of a better word picked up the slack. I find that in advance of it shocking in retrospect, very thankful because you have the market at a high. Four sectors are outperforming. A fifth is basically in line. Half the index is doing better than the index. You can't really do too much better than that. It's pretty good. Some are wondering whether people are too giddy. I mean, the nuance in your bullishness, it has been and it remains to be that you still think we're going to have a sizable correction in the market before we have a pickup. I was going to ask you before I read the notes that you gave our producers whether you thought that already happened. Yeah. And in fact, you don't think it happened already. No, I don't. I think we've had a rolling bear market and a lot of groups, Mag 7 and software crypto and now the AI stocks. But we haven't had a broad to risking. I think that is later this year. And it probably is around this inflation derangement syndrome that is the market is very concerned about. You know, whether the Fed should be hiking in September. I think there's a real battle until September. But our take, of course, is that inflation is much weaker. I think that there won't be a hike in September. Well, I mean, if the market comes around to that view, then why would you have a 10% pullback? You think the market is just going to get so crazy with itself that it's going to convince itself that there's a hike coming in September. Even by the way, amid reports in some publications that chairworses is ready to do that. If he has to, if inflation remains hot into that meeting. Yeah, I think there's I think it's still a hotly debated because there are economists who want the Fed to hike just to reestablish credibility with financial markets. We know the media and investors are impatient with inflation because it's at two six. They want it down to two. But at the end of the day, if underlying inflation is much weaker, which is our our take, then I think it's a mistake for the Fed to hike. But this is not a consensus for you. I think it's still about around. How about that nuance of of Tom's outlook? The fact that you know, everything's great. You pointed out so many of the reasons why so many are now bullish. But this is lurking. And it's going to be, you know, Jackson Hole later this month. Then this Fed meeting in September, which is going to be one of the real wild cards in this whole story. So with respect to the worst statement about well, inflation keeps going up. Then I'm going to that's the most banal down the middle statement of Fed share can make if inflation is exceedingly high relative to our target. Then we're going to have to hike rate. So so I'm fine with that statement. Generally speaking, I'm with Tom. I don't think inflation is quite as bad as the headline number suggests for a whole number of reasons that we're not going to get into now. I disagree that they shouldn't I think they're the 50 50 is right. We have a job support. We have some inflation readings and that those reports are going to carry even more significant. So normal in terms of what the Fed, we're saying 50 50 that the high. Yeah, I think the market is about 50. I think it should be 50 50. I think it's. I could make the case. They should I should make the case. Just keep mine at the September meeting. It won't be 50 50's either. It's a. It's a binary. So that's why it's a battleground September meeting. In the sense that if they don't hike, then the market might even fight that and even trigger volatility. I will tell you I mean I would push back on that. I guess in the sense that it could still be 50 50 because for the first time in a long time, we're not going to get the handholding from the Fed that so many have become used to, which is why no matter what happened in the prior meeting. It could be deemed a surprise relative to what the market was already, you know, had convinced itself was even possible. So things are a little bit different as that goes. I think it's certain ties into our view that the market still in the process of testing the new Fed, Kevin Worsh, because he is trying to rethink communications for guidance and even what inflation is. Is that what the 30 years sticking at 521 520? There it is 521 today. Yeah, because it may be reflecting on the uncertainty that is created by lack of Ford guidance and lack of Fed comms. Or it could be the idea that we are it's inflationary. We actually don't really know what's being priced into the market. But if I can pivot off that for a second on the credibility conversation, there's a number of, I disagree that the Fed is losing credibility. I don't buy that argument. I'm not alone. I have a torscent slot recently put out something along those lines, Robin Brooks, formerly of Goldman Sachs on Twitter made a similar argument. We're not alone. There's a transition going on here. It's sort of the analogy I've been using as a kin to let your child cry it out when they're younger and have to go to sleep. The child is used to you coming in every day and putting you on the head and putting you to bed. and now all of a sudden, Daddy doesn't show up and the baby's screaming. And to some degree, the market is the screaming bit, I don't know that this is totally correct, but we'll go with it. The market is the screaming baby right now, figuring out what is the new normal in this era. And I think 50/50 in that type of environment, where the Fed is not holding your hand for better or worse, is the correct probabilistic outcome in front of a job support and a couple of inflation reports? - Right, but my point is the markets, so what you guys were just alluding to as well, the market's not used to going into meetings 50/50. - Sure, it usually knows. - Well, it should probably get used to it. It should probably get used to it, 'cause according to the article today, it's here to stay. Again, that's his prerogative. We can debate whether that's the correct course or the incorrect course. Obviously, any number of people have come on air. - Oh, they sure have. - It's the incorrect course. - Yes, obviously a huge debate about that, but the mechanisms of that are certainly different to what the conversation relative to, what the markets are gonna do. - Sure. - Between now and then is gonna be the broadening story. If earnings are broadening so much, like Waldron was talking about yesterday morning, then theoretically the market should continue to broaden as well. - Right, correct. - If you exclude the, second quarter earnings are up 50% year-to-year. Excluding investment gains, it's still up 22%. That's a huge step up in organic growth for the S&P 500, which was running at 13% last year, and it is broad-based. And I think the good news is that some of these are being reported at a time when they were energy inflation pressures and tariff headwinds. So I actually think the repeatability is the good story because next year, those anniversary. - Last point. - Four stocks, four sectors are up more than the index. A fifth is basically tied. Midcaps, at a high. Small caps, at a high. The UK, at a high. Germany and France, at a high. Brazil and Mexico almost at highs. There's lots of evidence that this is not just some Fed or Nei-infused rally, specifically in the United States. There's lots of things going well. And again, getting back to the original point to tie it up. Every company and every industry is basically saying, we're good good. - More conversations to come. We know that guys, thanks. Appreciate you being here too. SpaceX shares, they're higher today. The lock-up explorations now begin in what has been a very big week from earnings to this news. And today, our Morgan Brennan following all of that joins us now as you see. Hi. - Hey, that's right, Scott. It has been a big week. It's been a long week so far too. So happy Friday Eve. On Wednesday, post earnings analysts that JP Morgan wrote quote, there has already been significant pre-positioning ahead of this first exploration, the largest of many over the next several months. Maybe, as you mentioned, shares are up. They're up about 2.6% right now. But this is just the start. Available share accounts are just more than 140% today, representing 20% of insider shares. But billions more will unlock across multiple tranches into 2027. Bernstein says, by January 50% of shares outstanding will be in free float. The first explorations pertain to some investors and some employees, senior executives are subject to longer lockups and then Elon Musk, who owns about 42% overall of SpaceX can't sell until next June. If he ever does, if history repeats. Keep in mind, because some indexes change methodologies ahead of the SpaceX IPO to enable faster inclusion. A bigger float will mean a bigger waiting, which could mean more buying by funds. And that could be true for the NASDAQ 100, which adjusts quarterly. But Ben Emman's calls this a private quote mini IPO. And he notes most of the 911 million shares that are locked today were granted or purchased when SpaceX was valued between $20 and $150 billion. Where is it now? About 1.5 trillion market cap. So an historic big unlock that has enticed a big short with over 30% short interest in the stock ahead of this lockup expiration today. We'll see how it all plays out. But right now, we'd see, and perhaps maybe Scott, we've got some short covering. Yeah, for now. And did your point is well taken. I mean, there's so much more to come that it's hard to make a really firm judgment at this point, which means we'll talk to you many times in the weeks ahead. Morgan, thanks so much. That's Morgan Brennan. Now let's bring in Yorkville's Dan Ives. He's with us here. So are you thinking that at minimum, there's just going to be a surge in volatility around this name because of the surge and supply that's going to continue to come on the market? Yeah, no doubt. And I think also the index component is Morgan talked about just relative to what we see from a short perspective. What I think the reality is is that this is just the first one of these. And when you think about anthropocopinion others, it's really looking sort of case study at how this all plays out. I think the issue for investors, it's almost a tug of war. Because to some extent, there's the longer term view. Near term the lock up, that's sort of the albatross around the stock. Can we, following the earnings, can we move away from the conversation about, we're unsure what this company truly is or who they really want to be? If you look at the amount of money that they've already spent, and then the money, there's the cat-backs right there. We just had it on the screen more than $18 billion in the current quarter. And what we think they're going to continue to spend, this is a hyperscaler, isn't it? Oh, I mean, I don't think there's any doubt that's what they want to be. And to some extent, when you look at what they're building, the cat-backs arms raise that you're seeing playing out is, how do you catch up, Danthropic? How do you catch up to OpenAI? Look what's happening across Big Tech. I need to issue for investors, and we've taught that on the hyperscaler side as well, is you're focused on the longer term, but in the near term, petions is required. And I think for any of these companies, that continues to sort of be that quagmire. But the longer term vision, that's what they have to build towards. And are you telling investors today to buy it now with the belief that they can be that? They can be in OpenAI, they can be an anthropic, and maybe an Elon Musk's mind, they can be bigger and better than they are. I think for investors, anyone in space like you're betting on Musk, you're betting on the longer term vision. Now, when it comes to where you see what in terms of the lockup, that's something that that's just the pure reality that you cannot sort of talk that away, I think it's really-- this is someone's becoming a case study. Because investors want to see not just how this navigate's next few weeks, but over the coming months. Because when you think about what's behind it, and when you think about the fourth industrial revolution, this is really, I think, a good example of companies where they want to spend the lockup and then putting numbers up. They're not going to put up numbers that in any way would take away some of the questions that they have to execute over the long term. It is a Tesla combination inevitable at this point, a big teaser for what's down the line. We've said, I think there's over an 80% chance that SpaceX ultimately acquires Tesla. In my view, when you think about broader AI and broader, I'm from a data perspective, I think that was always sort of the golden vision for Musk. Now, rubber meets the road. Will investors, what will they ultimately say there as it all plays out? But I think this is the theme that we're going to see play out across tech. Because when you think about the hyperscours and what they're paying and they mount a cat-back, what we've seen across earnings season, mind is Asian now is starting to happen. What that means is shock clocks on, they know, times run out. And if you ultimately take foot off the pedal when it comes to cat-backs, you could find yourself way further in line. What about these other levers that they have to pull Starlink mobile? For example, which they talked about on the call. Some of the traditional wireless providers are shuttering a little bit as to what the ambitions could truly be and what the implications might end up. Being, how do you see that? I think for Verizon, AT&T, Timo, Bono, others, I don't even know the shot across the bow. They have such entrenched positions when it comes to the US market. But I think it just speaks to you are going to see a convergence of spaces. In other words, we're seeing more AI, telcos, the cat-back smiles. This is a Starlink story. It's ultimately a satellite story. And I don't think it just comes down to like, now it's proving out. But when you're public, every quarter you're judged against it. It's about execution. A trillion in revs by 2030. Is that realistic? OK, I think it all comes down to the space AI story. Remember, this goes-- I think this now takes it to much more the data story, the AI story. That's ultimately what they need to achieve. And then that's not going to-- the room wasn't built today. It's not going to happen overnight. But they need to step by step execute. And investors need to see the longer-term vision. It goes back to, if Jensen in 2022, they didn't see the AI vision. Even the Dell in 2014, they didn't see the cloud vision. I think that's what the thesis is. Appreciate the time has always been. Thank you. Thanks, that's Dan Ives here at Post 9 Western Digital and San disk. They're both falling today. It's certainly a weight on tech and the NASDAQ Christina Parts of the Nevelospine following that all day. For us, and joins us now with more. Scott, well, the AI storage trade really hitting a wall today. Start with Western Digital. You can see it's down about 12%. This is a hard drive maker, the quarterbeat. But its profit margin guidance came in below rival's Seagate. And that's important. Its shipment growth also slowed. And that was enough to snuck the stock down. San disk is a flash memory maker. So put it into the NAN memory category. It had a similar problem. So it had record revenue. But a guy just-- for roughly flat margins and only modest price hikes when investors really wanted to. that seems to be the theme across the board. Expectations are so high. Sandus did say it had more visibility with customer contracts though. Still, some analysts think Sandus is low-balling and its investor day next week could reset sentiment. This isn't though just about two stocks. These are momentum names. So when they break, they tend to drive the, for example, the momentum ETF down with them. Micron was lower, did bounce back, but just barely in the green right now. And speaking of bouncing back, the money coming out of memory may be flowing straight into Nvidia. Up roughly what, 13% just in the past week or so. So we're seeing a little bit of that rotation out of momentum. - That had a nice five day run, I think, for Nvidia. So thank you very much for that. That's Christina Parts and Neville. Software stocks, they're also losing some ground today after a wave of weak earnings results. See Mimodi tracking those moves for us and joins us now. What do you say? - Scott, DataDog was a big surprise. It's been seen as a leader of the data infrastructure space, earnings beat, but focus on the earnings call quickly turned to a reduction in usage bias by its biggest customer open AI. Now to reassure investors, executive shared that a renewal agreement with open AI had been signed, but remain sort of unclear whether it was in the same ballpark as its prior agreement. Investors sort of using it as a reason to sell after what has been an impressive run for DataDog shares this year. Elsewhere software companies Hubspot and Figma, cutting their revenue outlook, amplifying those AI displacement concerns, stocks are responding down double digit percentage points at this hour and apploven, delivering weaker sales growth that analysts had anticipated this as its direct competitor, Unity software really killed it on earnings thanks to a big jump in subscriber code. That stock actually higher by 17% right now, Scott. - All right, Simon, thank you very much for that. That's Seema Modi shares of Honeywell Aerospace getting crushed today to get the fill of bo who has more on this big move. What's happening here, Phil? - Scott, and you want to see an ugly chart take a look at Honeywell Aerospace today. The company reported that's results for the second quarter after the bell yesterday. And boy, did they have some bad guidance. And that guidance is the reason why the stock is down more than 23% so far today. They essentially have cut their full year adjusted earnings guidance by 6%. This caught analysts, it caught the media, it caught everyone by surprise. Sheila Kaila and Jeffrey said it best in a note where she said, "Brah, a guidance cut out of the gate, "2026 sales guidance cut to plus 4% to 5%, "organic from originally up 7% to 9%, "adjusted evit being cut down by 6%. "Jim Courier, the CEO of Honeywell Aerospace, " says that there are supply chain issues "that will be weighing on full year results. "The interesting thing is you take a look at this stock "since the spin-off at the end of June. "Jim Courier has been on our air three times "and we reached out to him again today to say, "what's changed?" But he's been on our air three times, Scott, since June 11th, when they had their investor day pre-spin-off. Not once, did he ever hint at major storm clouds like cutting the guidance by this much? Yeah, there have been some supplier issues, but this has certainly caught investors and analysts by surprise to say the least. - Yeah, in which they never like. And your point's a very well-made fill thanks, fill the bow. Per if food stocks mean time getting slammed today, Brandon Gomez joins us now with more on those. What do you see on your beat? - Hey there, Scott, yeah, Papa John's cratering after the pizza chain cut its full year outlook, suspend that it's quarterly dividend and said its turnaround is taking longer than earlier expected. North American same-store sales fell more than 8% in the quarter on softer demand and intense discounting. Revenue decline, nearly 9% in management expects sales to keep weakening. Now the company CEO saying it is no longer pursuing a sale, focusing instead on its turnaround strategy. Now let's stick with the restaurant sector, Shake Shack giving back some of yesterday's gains after reports that Starboard value had taken a stake in the company. Mizzouho today raised its price target to $9 from 80, saying Jeff's mis-envolvement could unlock additional value by slowing company-owned unit growth, expanding domestic franchising and finding some cost savings as well. Josh Brown earlier with you, I heard say, "It's too small a market cap for the size of Shake Shack's global brand, but there need to be operational changes. Something Starboard has executed elsewhere and we'll see if they can do again here." All right, good stuff. Yes, we will. Brandon Gomez, thank you. We're just getting started. Right here at Post-Night on Closing Bell. Coming up next, gaming out the Fed's next move. We've got a key job support, as you know, on deck tomorrow. A critical inflation print is looming next week. We'll break it all down. And what it means for the Fed and your money with Ellen Zentner. She is joining us next. We're live with the New York Stock Exchange. You're watching Closing Bell on CNBC. (upbeat music) (upbeat music) All right, we're back on the bell to hike or not to hike. That is the question facing a more divided Federal Reserve. Here with more as Ellen Zentner, Morgan Stanley, Wealth Management Chief Economist. Chief economic strategist, I knew I was going to mess this title up because it's a long title. It's a long title. It's a long title. It's a really long title. You can skip the rest of it. Welcome back. Thank you for taking me off the hook. The question, I mean, are they going to hike? This year? No. That's a firm belief of our economists at the firm. And of course, that's tied to getting inflation right. The inflation that is all that matters. And so that puts a big if around it. But I don't think Chair Warsh wants to hike. I think there are still more obviously on the committee than not that don't want to hike or at least not want to hike yet and can wait for more data. But we are pretty confident that the inflation data doesn't move in a straight line but continues to show a trend of softening at least. So we're coming down off those very lofty heights. And I think ideally for the Chair, you would rather not be forced into hiking this year, wait for the task force on the balance sheet to come back and devise a plan of how you can tighten financial conditions through the balance sheet as opposed to having to do it through rates. I mean, and frankly, through their own language. When the Chair in the latest news conference, and this is what led to some people suggesting, well, now there's a credibility problem because you can't come out and say, inflation's above target, we're resolute in getting it down. And then everybody's like, well, then do something about it and then they didn't do anything about it. To your point, if he doesn't want to hike rates, he hopes he can talk rates to where they need to go, at least talk tough. And the markets will take care of themselves. - Yeah, so I think I'd put a little more nuance around it. So I think what the markets had a real issue with was that we went into the meeting having a softer inflation print. I mean, one that came in well below expectations even. And so it would have been good to get some sort of communication around how that was taken into consideration in the reason for not hiking. And this is something that the press had really pressed him on in the pressur, sorry, that was unplanned. - It's okay. - But it was too good to pass up. And so they pressed him on that to say, is that part of your reaction function? Is that part of the framework? And they didn't get clarity on that. So rather than I think, I don't think he's been in the seat long enough to say you don't have credibility on inflation fighting. I just think that there's a lack of forward guidance and that's fine, but it's the lack of communication around what is your framework, what is your new reaction function? And that's why we see, not the only reason, but that's why we see more risk premium priced into the long end. - The point here ultimately is that the markets and market participants and people who have jobs like you have, you're not gonna get nearly as much telegraphing or handholding or anything. The market's gonna be a little bit on its own. You're gonna have to make your own judgments rather than everybody thinking that they have the best idea because they were all but told how to think about what's going to happen. How are you thinking about that change in communication? - Yep, so that's the data dependent. And so the data dependent, look, you see the data coming in, the market, you see the data and you're reacting to that and you are tightening financial conditions. And that's when you reference, well, financial conditions of tightening up to the meetings. So you're doing the job for us. And we're gonna let you do the job of loosening and tightening financial conditions. I still think what's missing is just that framework. The other problem is that that is something that is not new to Chair Warsh, Powell, Yellen, Bernanke, they all pay attention to financial conditions and how much tightening or loosening the market was doing for it. The problem is that you do need to eventually deliver. That is the problem. So if the market is begging for hikes and believes the evidence suggests you should hike, there's only so long that you're gonna be able to hold off before hiking because the market will start unwinding all of that and then you're back into the possibility that you're juicing an economy that's overheating. - How are you thinking about the jobs reports, Mark? - I think the jobs report is gonna be fine. You know, fine. 50, 70,000. Doesn't matter, it's enough to keep the unemployment rate steady. - Not overwhelming though. I mean, another reason I guess why you would say that, well, how could they hike rates in what is, you know, not a weak labor market, but certainly not an intensely strong one? - Yeah, but you've got an economy that just printed a near 10% nominal growth rate annualized on private, final, domestic demand. That's huge. And you've got inflation that is well above goal, can't ignore that. But the thing on the labor market is that I think, I think I really do think we can set the labor market aside because we've even concerns about it because we've even passed the fall from last year where we thought, oh my God, some real weaknesses coming, Fed cut three times to stabilize that. And you know, you don't really, I think we've had enough evidence now to say, you know what, AI isn't taking all of our jobs over the next 24 hours. And it's certainly not a focus of a lot of my investor meetings anymore. Is AI gonna take my job or my kids job? Will they have a job? So I think some of those fears have passed as well. And I think we're in good shape. - All right, well, it's good to talk to you again. Thanks for coming back. - Ellen Zettner, Morgan Stanley, wealth management, chief economic strategist and global head of the Maddick and macro investing. - You got it. - It's gonna do it right. We'll talk to you soon. Up next from DUNKS to DEALS, we're giving you a court side seat inside Shack's next big business bet and the empire behind it's day with us. Welcome back to closing, Bell. Some big news today regarding the NFL's next TV deal. Our Alex Sherman is here with more. This actually happened on an earnings call today. And I thought I was big news. - Me too. I think it's very big news. So the news is that Fox CEO, Lockwood Murdoch said that Fox will not be negotiating with the NFL early before its current deal with the NFL has an opt out clause at the end of the 2030 season. So the general timeline for negotiations is roughly, let's say a year before deal, expires. The league is almost certain to use that opt out clause to get more money from its current media partners. But it was open to starting those negotiations and potentially even reaching new deals with all of its media partners, including Fox this year. So the rub would be that Fox would pay more money for the NFL, but that opt out clause at the end of 2030 would go away. And that contract actually ends at the end of the 2030, 24 season. So in essence, Fox would pay more now, but they'd have the NFL for longer. And the decision by Lockwood Murdoch apparently is that Fox doesn't want to pay more money right now. So they'll take their chances in a few years. Have you surprised? Somewhat. I think the NFL wanted a lot more money. And so it definitely put these media companies in a little bit of a bind where, you know, Fox pays something like $2.2 billion per year for the NFL today. If the NFL wanted a billion dollars more, now you're starting to pay more than $3 billion here to the NFL, Murdoch actually said earlier this year on that he already was open to the idea of what he called rebalancing the portfolio, which in essence means that Fox would have to not pay for certain sports that they have historically paid for in order to afford the NFL. So the decision here signals that Fox may have some confidence that they can get a deal done with the NFL. And in the meantime, they don't have to take a billion dollars per year charge. So we'll see if they're right. Or they just want more time to figure out what the landscape looks like by the time they actually have to make a critical decision. Good point there, because as these media companies keep merging with each other, the amount of buyers actually dwindles. And that may help Fox's case. So we'll see. Okay, your big news of the day is that you talked to a very big man, Shakil O'Neal. I did. I talked to Shaq. He has a dunk league called Dunkman that he is the commissioner of and the co-founder of that is currently airing on TNT. It is also sort of a beginning stages of a larger special that we plan on doing on Shaq Inc, which will come out later this year. We did a similar thing with Steph Curry last year as part of the CNBC Sport Enterprise, where we will examine the different businesses of Shakil O'Neal. I asked Shaq about the dunk contest. And I also asked him about if he feels like younger people understand how dominant he was as a player. Listen to what he said. He is like what they like. And I was going to say Mike L'Obrano-Copey, which is fine. You know what? Nobody roots for the giant. Right. Nobody roots for the-- That's true. Big men don't sell. Yeah. So nobody really roots for us. That was a matter that you didn't know of us. Your mama knows that it was us and it's all the matters. I think that's true. I think that people that grew up with Shaq know exactly who he is. Younger people maybe only know him from his inside the NBA appearances. And the fact that he is this ubiquitous corporate spokesman. So that's what we'll go into a little bit with this. He was the most dominant big man of at least his generation. If not others. I agree. And probably could have won even more titles. And then turns out to be obviously one of the most entertaining and knowledgeable people about the game on television, but a super astute business man, which I know you'll get into deeper in the docker work. He is the second largest individual shareholder of authentic brands, which I know is contemplating going public. So if they do go public, we will know exactly how much money Shaq has in that company. But it certainly-- It's a big change. It's a big change. More money. All right. Good having you. Alex, thanks. That's Alex Sherman. Next, one payment speaking of money. One payment play getting punished, though, today. We'll give you the watch and the why. Next. [MUSIC PLAYING] I would send to the bell back to Christina now for the stocks that she's watching. What do you see? Oh, you teased it. Block. Beat and raised its full-year outlook. But the Q3 guide just offered little upside. And investors still want to prove cash-app can keep growing as its lending products cools. And that's how you're seeing shares down 6%. Peloton, sinking more than 16% today, even after turning its first-ever annual profit. The problem isn't the past year. It's what comes next. Paid subscribers fell nearly 9%. And Peloton expects sales to drop another 4% this year as it laps last fall's price hikes. So even with Peloton filing making somebody Wall Street is stuck on one question, can it ever grow again? Last but not least, Zillow falling even after a second quarter beat. The issue is, yeah, look, Zillow warned its core home listing business will barely grow next quarter, partially because traffic from Google search has slowed sharply. That's a threat to how Zillow reels customers in. The soft guidance follows 500 plus layoffs as well. It's good. All right. Christina, thanks. Christina Parts and NaviLos coming up. Two consumer names take center stage and over time. We'll tell you what to watch for from Airbnb and draft things after the bill. We'll do that more in the market zone, which is next. [MUSIC PLAYING] All right, we're now in the closing belt market zone, James Taylor, or the Taylor group of Wells Fargo advisors here to break down. These crucial moments of the trading day plus Oliver Renek standing by live from the Cevo Global markets in Chicago. I mentioned we do have two big earnings reports. In over time tonight, Mackenzie Segales looking at Airbnb for us, contestant Gruar has draft kings ahead of that. Brent for Oliver, we begin with you. Let's play some options, action. Tell me more. SpaceX, Scott, it's traded about two and a half times its daily options volume today. And it's a dead heat between bulls and bears. On a session where nearly 1 billion shares hit the market post lock up. But the two biggest money trades we saw were both very bullish and very similarly structured. They were combination trades that involve selling multi-million dollar batches of puts and buying calls on top of them. The biggest hit right at the open, a net $7.7 million bet that SpaceX won't be down another 20% 10 months from now. With an additional wager via calls that the stock could double by June next year. Then this afternoon we saw very similar approach, but smaller, a trader who sold 3.5 million of the 75 strikes expiring in January and bought 5 million of the 185 strike calls. Scott, its true options flows have been bullish and wrong all the way down, but at least these trades today looked a bit more sophisticated. OK, good stuff. Oliver, thank you. Oliver Renek, now to Mackenzie Segales, looking at Airbnb. So Scott, Airbnb, heads into earnings with what Deutsche Bank calls the cleanest setup in online travel with its core business re-excelerating. But much of the lift appears to be coming from travelers, paying more, not necessarily a major surge in the number of trips. The street expects revenue growth of 16%. World Cup demand helped. Bookings in host cities rose 26% according to Oppenheimer. But roughly 85% of that growth came from higher nightly rates rather than additional nights. Now, that puts a lot more pressure on the outlook. Airbnb shares are up 11% year today and recently traded near 52 week highs. So investors want evidence that demand can stay strong after the tournament, particularly as Europe and the Middle East soften. Also, key is whether Airbnb's latest push beyond home rentals can stick, especially after earlier failed attempts to turn the platform into a place to book services and experiences. Much of its valuation story now rests on making that reinvention work. Mac, thank you. Can you see Gales? Contessa, what about draft Kings? Draft Kings stock has dropped more than 50% over the past year. The pressure is really on the sportsbook here to demonstrate its resilience in the face of this new competition from CalShi and Polymarket. Draft Kings has its own prediction platform, of course, integrated into its unified app, encompassing sports betting, eye gaming, or that's online casino games, fantasy and lottery. Now, the street is expecting draft Kings to report revenues of $1.5 billion this quarter with earnings per share of $2.00, suggested. But while this quarter could get a boost from World Cup, investors are going to focus on how strong sportsbook is moving forward. What's the plan for growth? What's the ramp here for predictions? Draft Kings closest competitor, Fandals Ben Struggling, Flutter Shares plummeted. After the company reported earnings yesterday, Draft Kings shares are up. right now, but we will keep an eye on that after the close and after the report. >> All right, good stuff. Contessa, thank you. That's Contessa Brewer. Of course, I mentioned James Taylor sitting next to me here. So we're in the neighborhood, or certainly getting there of your year end target of 7,800 to 8,000. We're going to get there? >> I think so. Yeah, I think we're definitely going to get there, in my opinion, at least. I know Wells is between 7,800 and 8,000. I'm on the higher end. >> Yeah. >> What takes us there and then beyond? Because as I said, we're kind of on the doorstep, obviously, and there feels like there's enough momentum behind the market to get us there. >> Yeah, I think there earnings have been unbelievable this quarter. I mean, you're seeing 80% of the companies outperform the consensus, and if industry stays steady here, they're going to be a really good shape. >> Okay, how about that issue? Because we periodically during the program today have put up the 30 year. Obviously, the market picture, the yields rose a little bit after the last Fed meeting, and the news are we're at 521 now. Do you anticipate them staying here? If they continue to back up a little bit, is that a problem for the stock market? >> I don't think so. I think it's actually really interesting. You're filing a game page to hold Treasury and fixed income. So we're talking to our conservative clients, our moderate conservative clients, looking at fixed income at this point, which has been a long time bump. >> If the market's going to get to the 8,000 level and then be able to exceed that, what's going to get us there? Is it going to be a tech-driven story? Is it going to be the broadening story, which continues to develop because as you answered the very first question, we talked about earnings as we know earnings are broadening. That's got to be good for the overall broadening story, right? >> I think it's been great. I think it's honestly. We're not relying on seven names, anyway. Anymore in the tech space. The breadth of the earnings is really the story right now. I mean, the fact that you're getting 8% of the companies outperforming their consensus, I think it's huge. So we haven't had that in a long time, I think since 2021. So I think the earnings story is a really good one going into the end of the year. >> Seems to be a lot of momentum behind the financials trade. You like it. It sounds like it as much as anybody else, is that right? >> Yeah, well as for our go institute is overweight on financials as well as technology. I think both look really great right now and I think that healthcare trade has been pretty good too. >> What do you like? >> What don't you like? >> Right now, I hope we figure out things with Iran. I think energy has been gone through the roof. I hope energy prices do come down. And yeah, that's not really, you know, the space that I'm dealing with. >> You're not a fan of that sector? >> Not right now. >> Because you think oil prices are going to go down? >> I think oil prices are going to come down. >> And it's going to drive me because the performance has obviously been great. >> It's been great. It's been great. Yeah, it's been absolutely fantastic. One of the best performance sectors here today. We're taking games off the table there and rotating some of these other names. I've gotten B number. >> All right, good stuff James. Thanks for being here. James Taylor. >> First, thank you. >> Right here. Okay, the bill is going to ring and yeah, we're taking some games off the table. >> We've got the money coming in over time. I'll see you tomorrow in Tuesday. >> Okay.