← CNBC's "Fast Money"
CNBC's "Fast Money"
Fed Flying Blind Ahead Of Rate Decision… And A Homebuying Bummer 10/28/25
00:43:35
All eyes on the Federal Reserve ahead of tomorrow’s rate decision. The data, or lack there of, helping shape the central bank’s next move, and how broader markets will respond. Plus Waiting on interest rates to drop? Don’t hold your breath. Why a top mortgage economist says it may be years before we see rates drop below 6%, and the impact it could have on the housing sector. Fast Money Disclaimer
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- [00:01]
Melissa Lee
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- [00:30]
Tim Seymour
What does 268 horsepower sound like? You're hearing it right now.
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Melissa Lee
The all new Audi A5.
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Tim Seymour
Precision crafted to bring the thrill to every turn. This is powerful performance.
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Melissa Lee
The all new Audi A5.
- [00:48]
Guy Adami
Live from the NASDAQ marketsite in the heart of New York City's Times Square. This is fast money. Here's what's on tap tonight. Nvidia closing in on the $5 trillion mark. All the headlines from today's GTC event driving the stocks move and the groundwork it lays for the rest of mega tech. Plus, mounting layoffs. Amazon and UPS joining the growing list of companies cutting white collar workers. What signal does this send to the Fed ahead of tomorrow's decision? And mortgage mayhem. Rates may have come down from recent highs, but one top housing economist says homebuyer should not expect further relief anytime soon. His stark warning is coming up. I'm Melissa Lee, come to you live from studio. Be at the nasdaq. On the desk tonight, Tim Seymour, Bono and Ice and Dan Nathan and Gai Adami. We start off with that monster move in in video today. The semi giant getting even more giant pulling within a stone's throw of the $5 trillion mark. The stock jumping nearly 5% and adding more than $230 billion to its market cap just today. That is nearly one whole Goldman Sachs. And the move coming as Nvidia hosts its second GPU technology conference of the year where it announced partnerships with companies, companies from Nokia Crowdstrike and Palantir to Lowe's and Uber. CNBC's Christina Parks Nevilla spoke with Nvidia CEO Jensen Huang this afternoon. She joins us from the conference in D.C. christina?
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Christina Parts Nevelos
Melissa, can you believe that? I was talking to a chip analyst who said how long is it going to take for Nvidia to hit 6 trillion? We're actually even talking about 6 trillion given 5 trillion is around the corner. We really saw Nvidia shares going into this event. GTC just you know, up marginally, not even half percent, but inch closer and closer to $5 trillion. Really moving higher at the end of the keynote after Jensen did say quote or I should say cumulative demand for Blackwell and Rubin chips have reached $500 billion in orders through calendar 2026 and that doesn't include their networking business. So that could be major upside to street numbers that doesn't necessarily even include China. So they that $500 billion in orders for Rubin and Blackwell. Maybe we'll get China out of this trade talk deal. And so all of that is being taken as a really bullish sign that demand is moving ahead of expectations. Could also be a good sign for for Capex spend and a read on hyperscalers moving into the numbers. Just on Thursday, Nvidia, like you said, announced many partnerships. Uber Department of Energy, they're building seven supercomputers, CrowdStrike, Nokia. I was able to catch up with, like you said, the CEOs of Nvidia and Palantir to discuss their partnership and how it's going to move just beyond data analytics and chat bot answers and towards real business decisions that can be made with or without AI. And of course that's scary to think about. Here's their answer.
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Melissa Lee
What's very, very special, I believe about our, our partnership is we're going to be able to move 2x and I think in the future even faster. So you get a much, much faster and actually because you can control it in a more granular way, much faster, much cheaper. And then the macro thing that I'm actually most excited about, which for our country, is because of that you can do manufacturing in America.
- [03:45]
Christina Parts Nevelos
So they're working together. The example they gave is Lowe's for example, that you would create a digital replica of your entire business working environment and the AI systems can make decisions on behalf of you. And that seems to be the way that we're going with agentic AI and individuals, you know, making decisions based off of me and then the same thing within the business world. But I think the major takeaway is that demand is really outpacing supply at the moment, hence that $500 billion number. And then also the positive comments around China, even though the talks haven't really happened, it seems like even the Department of Energy secretary was saying that he expects he feels very optimistic. And that was a quote just moments ago with journalists. So perhaps they're alluding to something we don't know just yet. But it could be positive read for a lot of tech names going into the end of the week.
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Guy Adami
Right. And Jensen Huang has really been playing into President Trump's goals here. I mean he moved the whole conference to D.C. correct. With the hope that the President would actually join. Obviously the President is Already occupied.
- [04:48]
Christina Parts Nevelos
Two big things to that. He ended his GTC speech with Make America Great again and then he ran up. So there was a lot of candid moments with him on the floor here. And he did say when he was with the panelists that he had GTC here in D.C. with the hopes that President Trump would be here. But President Trump obviously is busy, you know, you know, with the China trade talks. But Jensen Huang, he is going on a plane. He is heading to Korea. He wouldn't share any details as to which Korean leaders he'll be speaking with. There are some reports from Bloomberg that possibly there's going to be a new deal with Samsung. And so perhaps we'll be getting more information. But they're very, very confident. And there's been a lot of, you know, chats about how great the President is, how great the administration is in really bringing back jobs here and building out infrastructure and they're going to get rid of the red tape when it comes to power. Even when I asked the questions about nuclear, like nuclear, building a reactor takes years and years. You can't just do it like that. So how are we going to get all of these megawatts capacity out there? And they seem to think that the White House and all of the officials are really going to get on board and move things up.
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Guy Adami
Yep. Christina, thank you, Christina. Parts nevelos in Washington D.C. for us, Jensen Huang is seemingly doing everything right. I mean, short of gifting President Trump a golden gpu. He is, he is, you know, courting the president in terms of echoing some of the sentiment that the administration has regarding manufacturing in America, et cetera. And then also making all these partnerships, which seems to be the way to put market cap onto your company these days, ink a partnership and the rest will follow.
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Melissa Lee
Well, he even referred to it as a virtuous cycle. And so what is called today was called unofficially the Super bowl of AI. You know, all the companies, whether it's Palantir, CrowdStrike, you know, you name it, these are the companies that certainly will be part of it. And what we've already learned about Nvidia over the last call it two months is that they really are a, an infrastructure company and the way they are investing and where they, these deals have seemed somewhat circular in nature. Just getting to the numbers that we got that the analyst community now is scrambling over and what it means for valuations and a 4% move in Nvidia is probably the bigger move we've seen in Nvidia in a long time. If you Read at least some of the analyst reports that I'm getting. What's been implied by this 500 billion or half a trillion number is a lot of the street was somewhere between Blackwell and hopper, somewhere around 350 to 400 at the higher end. So it means what we heard today is probably some increase of anywhere from 25 to 50% on what the street was expecting in terms of shipments between now and the end of 26. That's extraordinary. Nvidia has always been this story where we've all known it was extraordinary. It was just how much more extraordinary I think today was more extraordinary 100%.
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Dan Nathan
Tim's right. And you mentioned his. His a fiduciary responsibility to his shareholders and he's doing it extraordinarily well. So good for him. Making deals, currying favor, all those things. Problem I've had incorrectly has been, you know, price to sales. Now you said $5 trillion. Let's round up. I mean, this is a company now that's a price approaching 19 times revenue, which is a big number at this mature of a company, I think. But people say it's a new paradigm that will grow into that revenue. We shall see. November 19th with this market move, that's when a report is going to be a fascinating day.
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Tim Seymour
Yeah. You know, it's also interesting that clout that Jensen now is having. You know, when, you know, the president threatened to send troops to San Francisco, Jensen was one of the CEOs that got him on the horn and he stepped back from that. And so, you know, we talk about this transactional nature that this administration has with business. And I think that's great example of it. You know, the one thing I'd say about Nvidia, Mel, you just said that, you know, one way to add market cap to your company is do a deal with them. Well, Uber closed down in the day. Palantir actually was unchanged on the day. And at some point it's not going to be that exciting to do a deal with them that's on the come in the future. And I think, you know, there's been hundreds of companies that Nvidia has invested in over the last few years. And a lot of those investments have to do with these companies. That was the Uber deal of buying these chips. So when you get this half a trillion dollar number and this company is expected to do, let's say, $300 billion in SAL next year, you have to start scratching your head a little bit whether we're getting a little too far over our skis. And then the other thing about this circular nature of all this investment and then they buy the chips back. You know, this is becoming very financialized. It used to be you sell a product, someone buys the product, they put it into work, they get a profit from it. If it goes really well, then they buy your next product. Right. So you think about it now, a lot of the financings and all this stuff that's going on in and away from Nvidia too. There is a lot tied into this one name right now that used to not be it. It was a single play on the build out of this theme. And then we had the hyperscalers. But now it's moving all over the place and it's infected the markets and there is risk to that. There is risk that people are saying 5 trillion is going to be 6 trillion really soon. And I just can't find anybody who thinks that there's some danger to this for the broad market, not just this name in particular.
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Bono
Yeah, I have a hard time arguing with that point. You talk, you mentioned two terms, much as I'd like to, circular and financial engineering. And I do want to acknowledge that there is a fair amount of that going on. With that said, I think I view it through the opposite lens. The knock on Nvidia coming in was that it was a hardware company, that it would be subject to cyclical nature and pullbacks and what they've done and it was somewhat self serving likely, but what they essentially said was, listen, we want to push into China because we want the world bidding building on our technology, American technology and Nvidia's technology. And all they've done is essentially replicate that within the United States. They are now on the public and private side with this Palantir deal. They have backed Circle and the NEO cloud companies. There is no way to continue to build up without being on the CUDA stack. Whether it be the individual chip. They have found a way to spread their tentacles, if you will, into all of the different facets of AI. And that is why I think that maybe the $5 or $6 trillion number might actually be too low. There seems to be no way to push forward into AI and we were worried about what their role would be then. Agentic and inference AI. And now they've kind of leapfrogged themselves into a leadership position in that next wave. And so it is circular and I want to acknowledge the risk that you're, that you're putting out there, but essentially guarantees that they continue to be at this very center of this flywheel so.
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Guy Adami
Guys, argument about 19 times sales. You're not worried about that. You're not worried about valuation at this point. You think that Nvidia has the lock on this?
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Bono
You can't not be worried about valuation. I just think that that can't be the only thing that cues your investment thesis. For one, it's still, what is it? A 60% gross margin business. So like a price to sales number doesn't tell you the same from one company to another depending on what their margin makeup is. I mean that, yes, I will acknowledge it. I think it's. You can never get too far offside. You can't just be a bull and not acknowledge the risks that are there. I'm just saying that they have now laid out a plan for how they will grow into those revenue and np.
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Melissa Lee
I mean again, the price to sales multiple is what it is. I'm not sure even what the sales multiple is and I'm not sure how far out we're calling for it. But if the nice thing about Nvidia is we do have benchmarks all along the way and these next couple of quarters of numbers, you know, without necessarily having to go out into the black hole of infinity and the unknown is I think these, you know, this is a company that's going to be trading probably inside 30 times on a P E basis with a. With a margin profile that still is extraordinary. With a growth profit profile that's extraordinary. You don't have to go out to hey, what's this really going to be? Now today we got numbers that again we don't know but we'll probably in the next couple of days know whether these were through 26. We can now begin. And Guy's number may be absolutely right. I've done that math. He's much smarter math than I am.
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Dan Nathan
Well, it's Georgetown.
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Melissa Lee
Yeah, he took he. I didn't know they had math at Georgetown but other smart kids were taking it. So I'm less worried about the multiple, especially an earnings multiple for a company that right now has the ability and bond. When you're saying this, I mean they've ultimately inserted themselves into the middle of the industry and whether it's. They've gone from hardware to platform to software to all of it. They're in the middle.
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Dan Nathan
I guess the bull case in the bull case has been the right case by the way, but it hinges on the fact that there's such a head start. The competition is not coming in a meaningful way, which is why they will join the 74% margins and not in perpetuity but for foreseeable future. And why that revenue number? They can grow into that valuation. Now, if competition does come, that obviously changes the entire narrative. And we've seen different times over the last year, year and a half where there have been glimpses of that. Obviously nothing has taken hold. But in least in my history of just watching things, when you have margins of, it's like Amazon says, your margins are my opportunity. And somebody out there is looking at this.
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Tim Seymour
Right, well, real quickly we had Dr. Karpine, you just saw him, right? CEO of Palantir. This is a company that trades at 100 times sales. So if you're not worried about 19 times sales is a company that's going to do maybe four and a half billion dollars in sales this year, maybe five and a half billion next year. Half of that is probably AI related. Okay. On their, their platform there. So when you think about a company being assigned a 450 billion DOL market cap for doing $5 billion in sales and telling a nice story and showing up, you know, next to Jensen, anywhere he pops up, it just seems like we are in a market right now that will be unforgiving if there's the least bit of slowdown or demand for this thing that's so supply constrained.
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Guy Adami
All right, meantime, the Fed flying blind to tomorrow's rate decision. The market pricing in near certainty for a quarter point cut even with no official jobs data thanks to the nearly month long government shutdown. But there is piecemeal evidence of an employment market under some pressure. Amazon today officially announcing it is cutting 14,000 job jobs. UPS saying it slashed payrolls by 48,000 this year. They joined names like Target, Meta, Starbucks and more who've called their workforces the markets, betting those job cuts are enough to prompt Fed cuts through the end of the year. Major indices setting intraday record records today yet again. So is that the right read on the headlines? I mean, but we've also heard from JP Morgan's Jamie Dimon who basically has told managers not to hire people. Let's see how AI impacts every part of our business because we know we're implementing AI in, in every part of our business. Maybe we can do more with less. So this doesn't really bode well for job seekers.
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Dan Nathan
No, definitely not. And again, I'm one of the people that think incorrectly. But I think the unemployment rate is going to move in a, in a measurable fashion higher over the next couple of quarters. And we will get data at some point and you Know people will say that's a good thing for the market because it makes puts the Fed in play. There are some people by the way that think there's a chance for 50, 50 basis points of cuts tomorrow. I am not one of those people. With all that said, we're in the sweet spot now where job losses and the unemployment ticking higher is a good thing. At some point though, that pendulum swings the other way.
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Guy Adami
At some point bad news is bad news.
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Melissa Lee
If we get 50 bips tomorrow, insanity lives. And because we don't have an economy or a job market that that is indicating this. And throw in liquidity dynamics because we're not getting data. Well, we're not getting data and it.
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Guy Adami
Hasn'T trickled through the data. But anyway but lost a month of.
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Melissa Lee
Data and we're going to say the data we would have gotten tomorrow or we should have gotten last month was data from a month before. Concurrent we're hearing from companies, we have some sense of where the economy is. The regional Fed surveys offer a lot. I think you just get back to a place where yes traditional measures of the relationship between the unemployment rate or the rate of change in the unemployment rate, whether we're talking some rule guy. Yeah. Or whether we're talking Taylor rule, whether, you know, there's a lot of good rules out there that we learned in business school and it may in the context of the conversation we just had mean that the economy is in a great place. But we don't know what the unemployed consumer who had a. Just call it a mid office job. I'm not, you know, I'm not trying to characterize it one way or the other. I'm talking about the kind of job that seems to be most in jeopardy here. And we don't know the impact.
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Guy Adami
Right. And those are the consumers that are still spending at this point in time or the data is showing us that there is spending on that level. So when you're hearing about corporate jobs being called that is the concern.
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Bono
I think, I think it's a concern. But again as long as the consumer continues to hold up in spend and deleverage then I think then you kind of are in a, I'm not going to call it a Goldilocks situation but it still pushes out I guess the worst case scenario going into the, the Amazon and UPS layoffs that you mentioned. I think those tell completely different stories. I think UPS is one of the whole good situation, you know, pull forward that we had in 2020-23 on the back of the pandemic I think that's reverse course and you know, you, the volumes aren't there to support that workforce. I think on the Amazon side, I think perhaps essentially we should be reading through. We were just talking about Nvidia and Capex spin. I think this is very supportive of that. They're essentially saying we want to make sure that we can continue to make this investment. This is where we see the highest potential ROI and we want to still show that we have some capital discipline to our shareholders and the best way us to do this at this present moment is this, stack that up against an unemployment, an employment backdrop that is deteriorating somewhat. They will be able to go back and pick the best people for those particular roles if they so need. So that may be something that pivots but I think that those do tell two different stories. One, being very supportive.
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Guy Adami
I mean I think that there's a sort of a trade off rates like you can cut some jobs but you may still make gains in productivity. How do you weigh that? You know, how does that shake out? For more on tomorrow's Fed decision, let's bring in Evan Brown of ubs. He is the head of Multi Asset strategy. Evan, great to see you again. What do you make of where we are in the markets right now given the backdrop we just laid out?
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Evan Brown
Yeah, I mean I think it's, it first of all it's a strange economy right now we're talking about that, that GDP is, is quite strong but the labor market is soft and we're waiting to see how that will, will evolve. But the soft labor market is what's getting the Fed to cut. And just history shows when the Fed is easing and the economy is holding up and earnings are strong, that's some of the best returns that you get in equities. And so I think it's kind of keep it simple, this is a good environment for stocks.
- [19:12]
Dan Nathan
And when does the unemployment, what level does the unemployment rate become problematic for the markets? Forget about the Fed because they're focused on it.
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Evan Brown
Yeah, I don't know that it's a particular level. It's the, it's the speed. Right. And you know we still have a pretty low overall level of unemployment, 4.3% we think because we, we're not getting the data at this point. But if we start seeing the speed pick up, if we start seeing initial jobless claims spike and we are at least getting the state level data there and it doesn't look too concerning then, then I think we're in okay shape.
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Melissa Lee
Evan, today was A day when in terms of asset allocation. Yeah. You had equal weighted do nothing. In fact be down. Most of the S and P was down today. And. And so we're at a place just kind of curious how you're kind of advising across this, this, you know, this big umbrella that you see and that you have to advise into. Is it to lean heavier into the stuff that's working? Is it to find some value in the relative value cases? You know, there's been a health care resurgence. So how are you viewing this? And you know, as always, we talk about breadth or lack thereof and it's easy to get concerned on a day like today. If you want to find that side, where do you sit?
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Evan Brown
Yeah, I think for the most part we're leaning into to what's working. I mean, I think there are some sectors that, where you're seeing the earnings and they're not being rewarded to the same, like financials. We're overweight there and we think we're going to get going again. But with the momentum that we're seeing in tech, I don't think you want to fight that. And we'll be getting a lot of earnings coming soon. We'll see how they come out. But. But it's looking pretty good on that front.
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Guy Adami
You are looking for other ways though to play the theme. And you're saying to look at China, which is interesting.
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Evan Brown
Yes, definitely. So, I mean, China is just a. It's a lot cheaper way to play a theme. Less crowded. But also it's a different kind of approach to AI, where here in the US we're trying to build the greatest model possible and reach super intelligence and all this. Whereas in China, whether it's by choice or just limitations in terms of not having the same access to the chips, they're focused on efficiency and they're more focused on, ok, what are the immediate applications right here. And I think there's something to be said for that.
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Tim Seymour
So going back to the jobs thing in the stock market performance, Derek Thompson, who has a great substack, had a chart that he was saying the scariest chart in the world. So October 22nd is launched. Stock markets up 70% from their job openings are down 30%. Now, you don't have to say that's all because of GPT. This thing hasn't been useful probably for just until the last year or so. But how are you guys thinking about that? Because we're talking about these job cuts, you know what I mean? And eventually we're going to see a level of Productivity because the tools are good enough. But right now, doesn't there seem to be be a big divide between what the market is willing to suggest productivity is going to be and then this job opening situation?
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Evan Brown
It's, it's very tricky. I mean, on an individual stock level, you hear these companies, they're doing layoffs and people are saying, okay, that's good for margins, stock goes up. But if this keeps building up, clearly you're going to have a problem. And because that's going to hit the top line, enough people lose their jobs and that's going to weigh on spending. And so we're just, you know, we're not trying to predict, I don't think anyone can like predict exactly what's going to happen here in terms of just how much productivity we're going to get. I do think that this is going to create at some point some meaningful public policy conversations of, okay, there are a lot of people who are out of work because of these AI tools. What are we going to do about it? Is there going to be talk about redistributing income? And you know, that time might actually come sooner than we expect given what we're hearing right now.
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Guy Adami
Wow, Evan, thank you. Great to see you.
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Dan Nathan
Before we go, can I just say something about Evan? First of all, UBS is lucky to have him, number one. Number two, last time he was here, we had a Peter Frampton conversation. I recall Evan was not familiar. He does, because you know what happened the next day he texted me and said, I'm listening to Peter Frampton.
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Guy Adami
I am not surprised.
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Melissa Lee
Great stuff, by the way, which is why UBS is happy to have him because, I mean, this is a guy that goes back and does his work. Recognizes, by the way, where he was wrong in not having listened to Peter Frampton coming in.
- [23:20]
Mike Fratantoni
Great call guy.
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Guy Adami
Thank you, Evan, again, thank you.
- [23:23]
Evan Brown
Thanks a lot.
- [23:25]
Guy Adami
Coming up, we are getting ready for Thursday's meeting between President Trump and Xi and bringing you the latest headlines from Trump's Asia tour. Plus, checking out on in on Chatbot. How open I see me up with PayPal to bring its digital wallet to the chat bot. Don't go anywhere fast. When he's back into.
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Melissa Lee
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- [24:09]
Tim Seymour
That's the sound of every interior detail refined. And that that's the sound of Quattro all wheel drive, the all new Audi Q5, the all new A5 and Q7, each one a statement. Performance never goes out of style.
- [24:30]
Melissa Lee
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Guy Adami
Welcome back to Fast Money. President Trump set to meet with China's President Xi this Thursday. The president saying he is confident the two sides can come away with a trade deal and a tip tick tock deal. Our Emily Wilkins is in Washington with the very latest. Emily hey Melissa. Well, yeah, I mean a trade tick tock. They're just a few of the many topics that the two leaders are set to discuss. We're expecting them to focus on a number of things, including rare earths, fentanyl, shipping fees, plus a member, of course. Treasury Secretary Scott Bessant promised this earlier this week that soybeans would be on the table and what would result would make US farmers happy. The Wall Street Journal is also reporting that if Beijing takes steps to cut down on the export of the chemicals that make fentanyl, then the US will in turn have that 20% tariff related to the drug that they put in place earlier this year. Now Trump has spent the trip meeting with several leaders of Asian nations, forging various frameworks for future trade agreements meant to benefit the US and really strengthen the US's hand in the region. Trump also dined with business leaders in Japan, including CEOs from Apple, Salesforce and SoftBank. Now Trump used the dinner to tout new investments in the us, including several in energy infrastructure. Trump did project confidence in the meeting, saying that saying during the dinner that he thinks that his meeting with Xi will work out well. Melissa, Emily, thank you. Emily wilkins. Well, President Trump, as Emily had mentioned, is already in Asia. He's also announcing today that Toyota is investing $10 billion in the U.S. u.S. As part of a plan that could hit $400 billion. So really racking up the deals in terms of investment here in the United States. This would be the longest winning streak. This is the longest winning streak for Toyota since September of 2017.
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Dan Nathan
Been a complete underperformer. But Tim said it last night we did a trading the Globe segment.
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Melissa Lee
Yeah, we did.
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Guy Adami
We traded the money in motion and options, actually.
- [27:24]
Melissa Lee
We stay with the good shows. We stay with the ones that matter.
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Dan Nathan
But I think there's some tailwinds here. And if they do, if some deal happens, US China, as much as the US Stock market will go higher, I think China will go up one and a half times that. K Web is still a buy here, in my opinion.
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Melissa Lee
I was going to say Evan Frampton Brown talked about the impact on China and I look at that K Web chart. It's kind of the inverse opposite of what you've seen with a lot of these US Tech companies. In other words, you do a five year on that. You can see we only started the base about six months ago, nine months ago. Chart alone doesn't do it. I do think that the Japan story is the Takaichi US Kind of embrace is something. It's real. They've always been one of our biggest allies. They continue to be. And there's maybe been a refresh of that relationship. China, I would just say mega caps and some of their big industrial, but also tech companies, they traded a 30% discount or so on the industrial side. And the tech side, it's not even close. So I like Japan here.
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Guy Adami
That new Prime Minister Takechi gifted President Trump Shinzo Abe's golf clubs.
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Melissa Lee
Well, and that's saying something because. No, it is. And Abe is like her, her, you know, biggest, she's a disciple and she absolutely has molded a lot of policy. I think it's a really important time. The one thing I just say geopolitically is Southeast Asia was historically has been a place where we've had incredible partnerships with Philippines and some of the other southeastern nations. And, you know, some of the tariff dynamics have pushed some of those nations closer to China. And that's something I think this administration probably is thinking about as well.
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Guy Adami
There's a lot more fast money to come. Here's what's coming up next.
- [29:02]
Melissa Lee
An AI payment push how open AI and PayPal are teaming up at the checkout line for Chad GPT plus a home buying bummer. Why one top mortgage economist sees no.
- [29:15]
Tim Seymour
Relief for home buyers anytime soon and what it could mean for the housing space.
- [29:20]
Melissa Lee
You're watching Fast MONEY live from the NASDAQ market site in Times Square. We're back right after this.
- [29:31]
Tim Seymour
If you could hear love, what would it sound like? Son, can we talk about your drinking? Yeah, Dad, I think we should.
- [29:50]
Dan Nathan
Helping those closest to you think about their excessive drinking.
- [29:54]
Tim Seymour
Maybe that's what love sounds like.
- [29:56]
Dan Nathan
More@rethinkthedrink.com An OHA initiative.
- [30:02]
Guy Adami
Hey, friends, this is Audie Cornish, host of CNN this Morning and the assignment. And guess what? Every story you care about, every angle you want unpacked is now streaming on cnn. That means you can catch my show or other CNN programming whenever you want on your favorite device. And a subscription also gets you access to exclusive video series and unlimited articles. So subscribe to CNN@CNN.com subscription do welcome back to Fast Money. Shares of PayPal surging nearly 13% at its highs after announcing a partnership with OpenAI. PayPal will soon be integrated into Chat GPT and users will be able to complete payment transactions within chat. The company said it will incorporate merchant catalogs to make products more discoverable. The company also posted better than expected earnings and revenue for the third quarter, raised guidance for the year. The stock, though, is still down 14% in 2025. I mean, making transactions almost frictionless within chat GPT. That seems like a holy grail.
- [31:06]
Tim Seymour
Yeah, well, I mean, think about it. OpenAI is going to be that everything app. That's the thing that Elon wanted X to and I'm sure he's not particularly happy about that. That Sam Altman is making, you know, quick work of that. So if you're like one of the first payment systems to be integrated into whatever this thing is going to end up being, you know, OpenAI probably has 800 monthly active users. They're going to have 1 billion, 2 billion, 3 billion just waited out. So if you can kind of figure out how to become a very important there no matter what you're doing PayPal obviously and payments here, that's going to be a good thing for a company like this going forward.
- [31:39]
Melissa Lee
I, I'm long PayPal. I've been long PayPal for a year and a half. I'm going to stay long PayPal without the agent I protocol. And I think that's great news and I think it is important for them to find a place where they actually are, they are growth. They are part of the new payment story. That's been the problem. They really have not been. And, and the company is cheap now. Now what we heard today, it was a third quarter beat, was a fourth quarter guidance. There's nothing about that that's a surprise. There are new products and there is a new horizon here. So I like the chart too and I just think this is a name that you, I don't think you get hurt here.
- [32:13]
Bono
Yeah, I'm probably a little less excited. But I do think it addresses the core issue which was that they were struggling for growth. And I do think this provides a pathway forward. I'm not really sure I understand the timeline and how much of that will be pulled afford and reflect it in the stock price in the short term. My other concern is I'm not, I'm not sure whether or not this is an exclusive deal with Open Air, whether or not there will be other payment systems and how long it will take for them because if I've seen anything from Open Open Air, it's a land grab. I would, I would, you know, assume that they want as many transaction partners as possible on this platform. And so I just don't know how long the moment in the sun, so to speak for PayPal will last year coming up.
- [32:52]
Guy Adami
Are you waiting for mortgage rates to come down? Our next guest says it may take a few years. He will lay out the case and the ripple effect it could have on homebuyers everywhere when Fast MONEY returns. Welcome back to FAST Money. Stocks closing at record highs yet again. The Dow jumping more than 150 points. The S and P up about a quarter of a percent. Just a few points away from the 6900 level. The NASDAQ leading the gains up 8.10of a percent. Gold meanwhile settling below the 4000 mark for the first time in nearly three weeks. But the GDX Gold Miners ETF closing up more than a percent and a half today and some more after hours action. Bookings. Holdings topping EPS and revenue estimates. Mondelez doing the same but lower after cutting full year guidance. Revenue guidance specifically Caesars falling after missing top and bottom line estimates. And Seagate beating expectations and upping its revenue as well as as EPS guidance. Well less than 24 hours until the next Fed decision. But even with expectations of more rate cuts on the horizon, a top housing economist says mortgage rates could say above the 6% level through 2028. Mike Fratten, Tony is behind the call. He's chief economist at the Mortgage Bankers Association. He joins us now. Great to have you, Mike. This is very disappointing for a lot of people who are waiting for rates to come down, who believe that rates are going to come down because the Fed is going to continue cutting. So, so is this a bet that the 10 year yield that, that, that the Fed is not going to cut as much, that the 10 year yield would be higher, or is this completely a different sort of untethered call to that?
- [34:24]
Mike Fratantoni
Yeah. Well, thanks for having me. Appreciate the opportunity to talk with you all. Yeah, we expect the Fed's going to cut tomorrow. We expect they're going to cut three or four times over the next six months or so. And responding appropriately to a weakening job market and a slowing economy rate, they're going to be prevented from cutting more aggressively from that. From the fact that inflation we think is going to keep rising from here due to tariff induced effects. But exactly to your point, 30 year mortgage rates really much more closely tied to the longer end of the yield curve, 10 year treasuries and beyond. And we think those are going to continue to be pushed up by rising term premiums, investor fears that inflation is going to pick up again and concerns about just the level of the debt and deficit and just the ongoing treasury issuance that's going to need to support that. So as you said, our forecast is mortgage rates at least on average not going to move too much from this sort of six to six and a half percent range we've been seeing recently, just the last couple of weeks, we're down to about six and a quarter, which is the lowest we've seen this year.
- [35:29]
Guy Adami
So what is your outlook for the housing market that Mike, if you think that rates are going to stay elevated or within this range, which is, is in many people's view elevated, and the employment picture worsens.
- [35:40]
Mike Fratantoni
Yeah. So 2023 was the low point for the housing and the mortgage market. Things just flow to an absolute crawl. After the fed raised rates by 5 plus percentage points, we saw mortgage rates more than double and touch 8 percentage 8% at one point. It's gotten better in 24, a little bit better in 25 and we think we'll see home sales increase in 26 by about 5%. What's really changed though is where the last couple of years for a potential buyer, the real frustration was the lack of inventory on the market. That's changed in 25. Builders have been busy putting up new units and even existing owners have been more active in terms of listing existing properties and the benefit for the buyer is a whole lot more inventory to look at. But the challenge for the seller is it's taking longer to sell. And we've really seen home prices flatten across the country.
- [36:37]
Dan Nathan
I Mike, over the last 50 years, there's nothing extraordinary about six and a half percent mortgage rates. I think it's the rate of change that scared people. So my question is how long does it take for the sticker shock to wear off where people are comfortable with six and a half percent?
- [36:52]
Mike Fratantoni
Yeah. Well, I think for the first time buyer, they've already acclimated to this. They have budgeted to a six to six and a half percent rate rate and they understand where home values are in the markets where they're looking. I think the challenge to your point is to that potential move up buyer who, you know, maybe they locked in a 3% rate and understandably they are reluctant to give that up in a market where we're now six to six and a half. So we see this as a market both because of demographic reasons. The millennial cohort is so big, it's leaning towards first time buyers and the fact that you have these reluctant move up buyers. But as I said in 2025, we've seen existing inventory increase, you know, call it 30% above where we were last year. And I think that does say that some people are getting again acclimated to this idea that this is the new normal level of mortgage rates.
- [37:46]
Guy Adami
You mentioned the builders, Mike, and the builders have been buying down mortgages, you know, to five and a half percent level, five percent level. They're abouts. And so do you anticipate that this continues or will that be becoming acclimated to this new rate? Will that allow the homebuilders to stop buying down to that extent?
- [38:06]
Bono
Yeah.
- [38:06]
Mike Fratantoni
Well, I mentioned that inventories are up and that's particularly so on the new construction side. We've got about nine months of supply at the current sales pace. And so builders are very interested in moving those properties, particularly the move in ready properties. And I think what they've found is that offering a buy down, particularly a permanent buy down that rate is a very, very effective way at getting customers. So I think that's going to continue until we get that new construction inventory back down to a more typical level.
- [38:38]
Guy Adami
All right, Mike, great to speak with you. Thanks so much.
- [38:41]
Mike Fratantoni
Thank you.
- [38:42]
Guy Adami
Mike Fratten, Tony, of the Mortgage Bankers Association. That's pretty bad news for people in the market right now.
- [38:49]
Melissa Lee
Well, I think if people are getting acclimated to a certain 6 plus percent mortgage, I think they're going to start to get acclimated to the fact that prices are too high. I think you should have the same reaction, which is that there may be pressure overall on housing prices. Housing, housing prices overall have done very well over the last year, year and a half, even as the housing market's kind of done nothing in terms of velocity of sales.
- [39:12]
Bono
Yeah, I mean, I echo those sentiments almost to the T and I'm kind of switching over to like what it might mean for the commercial and apartment subsector of the housing market. I would continue to think that this is probably good for rents. We've seen some pullback in some areas of the Sunbelt, but I think this is actually probably somewhat of a tailwind for rent growth going forward. And unfortunately that might smell of inflation.
- [39:35]
Dan Nathan
Real quick, the Home dhi look at the report, look at the performance. These stocks have not bounced at all if you go back to the, you know, that September level. So I think home builders are trading lower from here.
- [39:45]
Guy Adami
Coming out the busiest week of earnings season in full swing. Shares of Visa on the move after reporting results and numbers out of the quarter. Next best money is back into welcome back to Fast Money Earnings alert on Visa. Shares moving modestly higher after reporting top and bottom line numbers that came in ahead of Wall street estimates. Conference call kicked off at the top of the hour. Houston's got the details. Hey here.
- [40:11]
Mike Fratantoni
Hey, Melissa. That's right. So like you just mentioned, Visa came.
- [40:14]
Bono
Out ahead for its fiscal 4Q results.
- [40:16]
Mike Fratantoni
With EPS and revenue topping estimates by around 1% each. Analysts focused on Visa's guidance for full.
- [40:21]
Bono
Year full fiscal year 2026 results with.
- [40:24]
Mike Fratantoni
The company saying that revenue growth would be in the quote, low double digits that exceeded expectations for high single digit revenue growth according to Truist and Jefferies. Another focus, overspending trends seem to be solid with growth in US spend holding.
- [40:36]
Melissa Lee
Steady at about 7% year over year.
- [40:39]
Mike Fratantoni
In the conference call still underway, visa CEO Ryan McInerney called consumer spend healthy and said that his company's diverse business model helped fuel solid growth across key metrics in the past year. He also said the company was leaning into investments for the future, including providing payment services to the AI industry and.
- [40:55]
Bono
To the tech giants.
- [40:56]
Tim Seymour
Melissa?
- [40:57]
Guy Adami
Hugh, thank you. Hugh. Sun, there are a couple more, you know, obviously the conference calls ongoing, but they also did talk about offering live agentic transactions. They also said the highest earning consumers are increasing spending the fastest. Interesting quarter here.
- [41:10]
Melissa Lee
Interesting quarter. And we did a preview on this on the overtime yesterday. I think if the, if like where the economy is right now. This is a great great I was on the way overtime yeah I was on the overtime for our show talk Morgan Brann, great show. Great to be on lead and here I am saying that what we talked about then was if the consumer kind of goes sideways meaning if we we keep the same macro backdrop here. I think this is great for Visa. I think it goes higher. I think it's cheap relative to MasterCard too. So if you're just playing a relative value trade. There you go.
- [41:41]
Dan Nathan
Margins were slightly lower than expected. Not a huge knock. Remember Louis Yamato who's probably watching right.
- [41:47]
Guy Adami
Now the base the higher in space.
- [41:49]
Dan Nathan
Yeah it's been based legend based a legend June and now if we can get it above you know it looks like it wants to make the turn so I'm sort of with hashtag smooth of closing but what was the show.
- [42:00]
Guy Adami
The overtime that makes us know just.
- [42:02]
Melissa Lee
The double OT well what are we.
- [42:05]
Tim Seymour
I don't know OT and you always.
- [42:07]
Bono
Get the international exposure. I think it was roughly 30%. You look at payment processing another 33, 35%. I mean you do have these revenue streams and again I mean despite what we heard from the cruise lines today and I think that is somewhat concerning that international aspect and the rate of growth of the upper end consumer is somewhat of a tell one here.
- [42:25]
Tim Seymour
Yeah. On a very short term basis from a trading standpoint if your stock out in beat raise is only up a little bit like this you better watch out the next next day. And you know that was something we've been seeing now like some of these stocks have been getting worse throughout the day. We saw it in PayPal, I think that was up 15%. Closed up 5%.
- [42:39]
Guy Adami
Coming up, major moves during the trading session catching our eyes today. The details and details sending Cameco, Wayfair and Celestica surging. That's next. And here's a sneak peek at the Kramer cam. Jim is chatting exclusively with the CEO of Nucor. Catch the full interview. Top of the hour and Mad Money. Meantime, more fast money into. Welcome back to Fast Money. A few fast movers from today's session catching our attention. Let's start off with Cameco surging more than 23% after the uranium provider inked a nuclear deal with the U.S. government to build at least $80 billion worth of reactors across the U.S. other uranium trades coming along for the ride. The you are a global X uranium ETF up more than 8%. Wow Tim, what a boost for the sector.
- [43:24]
Melissa Lee
Well you know partnership with the US Government at a time when the biggest issue in the past was the government and when in fact the biggest dynamic was fast tracking. This is all going to happen. A participation interest by the government in Westinghouse, which Cameco owns a major part of, is a great deal for Cameco. What I said four days ago, five days ago, this company is wildly expensive. Don't sell it, is my view.
- [43:47]
Dan Nathan
I agree with that. However, they report on November 5th, so maybe the way to do this is to stay long in earnings and do something ahead of that November 5th report. Because Tim's right. Very expensive.
- [43:57]
Guy Adami
All right. Meantime, shares of Wayfair hitting more than three year highs after the home goods retailer handily beat Q3 earnings estimates and said revenues jump 8% in the quarter. The turn to profit coming even in the face of President Trump's tariff. Shares are now up 140% this year. A lot of analysts were noting that there are a lot of buyers out there, 21 million buyers or something, and spread across all of these platforms in terms of sourcing suppliers. And so they're able to adjust with the times to cope with the tariffs.
- [44:26]
Bono
I have a hard time getting behind this trade. Not to be a wet blanket, I know. Like, where's the positivity? I think Positivity, exactly. Yeah. I'm just having a hard time. Listen, I think you always have the headline risk with China. We're going to have some deal parameters that are kind of released and I just, just think that after the move, what did you say? 140% already since the lows of the last 52 weeks. I think I just let this one rest here.
- [44:50]
Guy Adami
Finally, celestica also beating Q3 estimates, jumping more than 5% to a record high. The electronics manufacturer said revenue rose nearly 28% to almost $3.2 billion. It also raised its full year guidance to 12.2 billion from a previous $11.5 billion. I feel like we haven't talked about this in easily a decade.
- [45:10]
Tim Seymour
Yeah, I'm glad that investors finally found this one today. I mean, stocks up 250% here. It's up 500% off the April lows. It's up like 3,000% from the launch of Chat GPT. Let's be clear what this company does. They sell a lot of switches that connect the servers, they make servers. They work with, you know, Alphabet and Amazon and Dell and Hewlett to kind of, you know, furnish things in data centers. And, you know, to me, if they can pull this chart, I mean, I mean, what's going on here in some of these names? It's just not that natural. And you know, we've been talking about like a sandisk has gone from 20 to 180 in just two months or so. So I think investors are getting a little over their skis and some of these names Celeste is a 12% gross margin.
- [45:50]
Guy Adami
By the way, Jim is going to be speaking to the CEO of Celestica tonight, so you want to tune in for that? Up next, final trades, final trade time.
- [46:02]
Melissa Lee
10 Southern Copper Copper is going higher.
- [46:05]
Bono
I tend to agree.
- [46:06]
Tim Seymour
Real Dan Tim's PayPal what'd you say?
- [46:09]
Melissa Lee
Can't hurt you. Can't hurt you.
- [46:10]
Guy Adami
No. Well I said bye.
- [46:12]
Dan Nathan
Neither can Evan Brown who we now totally I think Newmont Money is turning a game Melms all right, thank you.
- [46:18]
Guy Adami
For watching Fast Money. See you back here tomorrow. Five Mad Money starts right now. All opinions expressed by the Fast Money participants are solely their opinions and do not reflect the opinions of CNBC, NBCUniversal, their parent company, or affiliates, and may have been previously disseminated by them on television, radio, Internet, or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Fast Money participants consider reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Fast Money disclaimer, please visit cnbc.com fastmoneydisclaimer Hear that?
- [47:04]
Melissa Lee
The next chapter of Audi Performance is here. The all new Audi Q5, the all.
- [47:09]
Tim Seymour
New A5 and Q7, each one a statement. Performance never goes out of style.