← CNBC's "Fast Money"
CNBC's "Fast Money"
Oracle’s Halo Effect… And CME Group CEO On Retail Trading 9/10/25
00:43:38
Shares of Oracle soaring after reporting results, and the meteoric move is bringing other data center stocks along for the ride. The names feeling the halo effect, and what the jump means for Oracle founder and chairman Larry Ellison’s net worth. Plus CME Group CEO Terry Duffy weighs in on the state of retail trading, as markets hit record highs, and rates remain in focus ahead of next week’s Fed rate decision. Fast Money Disclaimer
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- [00:01]
Melissa Lee
Want to quickly create and execute trading.
- [00:03]
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Strategies to help keep up with the markets. With Fidelity Trading Dashboard, you can access live data, advanced charting, portfolio insights and automated alerts all on one screen. We streamlined the trading experience so you can build and place trades better. Your Fidelity Trading Dashboard is ready now.
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Melissa Lee
For free, visit fidelity.com tradingdashboard.
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Terry Duffy
Investing involves.
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Commercial Announcer
Risk, including risk of loss Fidelity Brokerage.
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Melissa Lee
Services, LLC member NYSE, SIPC and now.
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Commercial Announcer
A next level moment from AT&T business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for International Sleep day. You've got AT and T5G so you're fully confident, but the vendor isn't responding and International Sleep Day is tomorrow. Luckily, AT&T5G lets you deal with any issues with ease so the pillows will get delivered and everyone can sleep soundly, especially you. AT&T5G requires a compatible plan and device. Coverage not available everywhere. Learn more@att.com 5G Network.
- [01:01]
Melissa Lee
Hi, it's Melissa. Before we jump into today's show, I've got something exciting to share. On December 11, we are hosting a special edition of Fast Money Live Trading the holidays right here at the NASDAQ market site. You get to watch a live taping of Fast Money, meet and interact with the traders and of course celebrate the holiday season with us. It's stocks and cheers in the heart of the city, Times Square in December. You will not want to miss this. Tickets are available now@cnbc events.com fastmoney 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. Outstanding Oracle shares of the software giant surging 36% and adding nearly $250 billion to its market cap. What it says about the state of the trade and all the companies that benefit from the gains and a rapid rate drop the Yield on the 10 year treasury closing in on 4% ahead of tomorrow's CPI print. Will the report solidify hopes for a Fed cut next week? And what could it mean for the markets? Plus, fintech firm Klarna makes its market debut. The trade desk tumbles on a Morgan Stanley downgrade and Robinhood unveils a slate of new products. How they will affect the stock as it trades near all highs. I'm Melissa Lee. Come to you live from Studio B at the nasdaq. On the desk tonight, Von Ice and Karen Feinerman, Courtney Garcia. And from the Robinhood Summit in Las Vegas, the one and Only Dan Nathan. We start off with Oracle's earth shattering surge. The stock hitting an all time high, up as much as 43% today, closing out its best session since 1992. The move boosted the software company's market cap by $244 billion, putting it within striking distance of becoming the next trillion dollar tech stock. The strength coming after Oracle said remaining performance obligations in its latest quarter more than quadrupled. That's a measure of bookings by the way, more than quadruple from a year ago. One big customer likely OpenAI. The Wall Street Journal reporting Today that the two companies signed a $300 billion deal for computing power that would be one of the largest cloud deals ever. Oracle's move having a halo effect over hyperscalers. Broadcom, Nvidia, Taiwan, Semi Micron, amd. They all jumped. Not to mention data center stocks like Corey Vertive, Dell and Supermicro. And power suppliers like Bistro, Constellation Energy, ge, Vernova, Eaton and Talon. The biggest winner of all might just be Oracle founder and chairman Larry Ellison who saw his fortune increase by more than $100 billion with a B today, helping him pass Elon Musk become the world's richest man. But the rising tide didn't lift all boats. Cloud giants Amazon and Salesforce down up more than 3% each today. So did Oracle's results just draw a line in the sand between the haves and the have nots in the trade? We were all sitting here last night digesting the quarter, watching the stock go stratospheric, hitting record highs in the after hours session. Karen. And here we are. It actually carried through into this session.
- [03:41]
Karen Feinerman
It did, it carried through and it traded as high as, I think 345. I actually did a put calendar because I just thought, wow, this is just, this is just not that it's not deserved. It was a giant, stunning, stunning release. But we still, we talked about this last night about the margin on the additional revenue and how, you know, margins will be compressed. The overall dollars of margins of course will be much bigger. But it just seemed to me like, wow, this is just a frenzy now to own this stock. And I wouldn't be surprised if, I mean, we know that AI is in the early innings, but we also know this is not a linear thing, right? And earlier in the week there was a story about AI adoption is slowing, which if we step back and you know, squint a little, it'll be the tiniest little, you know, nothing, little tiny dip. And so I know the overall trajectory of course, is up and to the right for a while, but this kind of move on a company this size is just, it's, it's enormous. And so would I be short it? No. Right. But to buy some puts, I think the risk reward got, they got crushed, obviously. I thought that was compelling.
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Melissa Lee
Right. But this also comes as we got that great data point from Broadcom with its stock pop. It also moved sharply higher in Today's session, like 10% or so.
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Courtney Garcia
Yeah. So, you know, we talk about broadening and how that kind of builds confidence for the market. You know, we wanted to see something outside of Nvidia that really had some sustainable pathway. You know, we called in question whether or not the capex spin would continue and we really felt that it was Nvidia and everyone else and perhaps at one point it was AMD that was the second player. Their quarter was a little bit less than stellar. But then as you mentioned, when you, when you bring in Broadcom and you think about inference and you think about kind of extending out just the data center play, I think, you know, there is a lot of positive there because at the end of the day, you know, since April, this really has been the AI Jason. I mean, you mentioned the utilities that are kind of tertiary plays to that. And I think this does show some sustainability. Karen makes a great point in terms of the slowdown of adoption, but I think that the change or the change in the rate of adoption does not necessarily mean that the target addressable market is significantly lower. So as long as I think we see continued spend on data center and to Oracle's point, I think a reason why you see a company this large have this size of outsized move is because keep in mind the capex spend and the free cash flow that they were foregoing in order to get into this market. And so I think what you're seeing is some somewhat of a follow through, some confidence in that spend and some broadening out from the one name that really has been at the center of this whole thing.
- [06:24]
Melissa Lee
Do you remember the quarter when Nvidia said revenues were going to jump by.
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Karen Feinerman
It was like seven to. Yeah, 11.
- [06:31]
Melissa Lee
Yeah, right. It was, it was a crazy guide. Higher.
- [06:34]
Karen Feinerman
Stunning.
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Melissa Lee
And it's sort of like what we did, what we saw in Oracle yesterday, where the guidance was just so strong. You rethink how you view this company and you rethink this company's trajectory in place in the trade.
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Vonnie Quinn
Yeah. It almost seems like it's an error.
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Melissa Lee
Right.
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Vonnie Quinn
I mean it's like that big of a, you have to like double check and say did I read that correctly? But I mean this, this company, if this is in fact accurate. It is. I mean this is what they're reporting. This demand is huge. I mean I think the question is we actually had a guest here yesterday, got brought up a good point that can they meet the demand like at some point is there like chip constraints or energy constraints to this kind of demand that they're seeing? But the demand is absolutely there. When you're looking at where investors are pricing this right now. It's now trading about 45, 46 times forward earnings which is much more than Microsoft and Amazon which are both in like the low 30s right now. So I mean this just completely popped. People are really trying to jump into this trade here and Capex is something to take a look at. I mean they were spending under $2 billion in 2020 on CapEx. It's now said to be 35 billion in fiscal year 2026. So yeah, I think the question is what sort of profit, profitability and is there going to be any sort of constraints to this. But the trend clearly is not over and I think that's what you're seeing with this sort of demand.
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Melissa Lee
Yeah. So Dan, I'll ask you, I feel like you're the right person to ask in terms of what the caveats could be in the guidance that we got last night.
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Dan Nathan
Well the caveat is that we just don't know. I mean these RPOs, this, you know, this backlog that we're supposed to get here, you know, this is something that needs to be achieved over the next couple of years, the spend to do that. I think Courtney just mentioned that Capex, I mean they were, you know, single digit, you know, billions as a percent of their total revenue. Their competitors are spending 25% of their revenue. So this is a catch up trade. We also don't know if this is a market share thing and if it's a market share thing then that means, listen, we already knew that this open air contract and some of these others were coming this way. Why? Because they're probably competing, competing on price. We also know that this is a company that's desperately trying to cut costs because they know that this spend is really going to weigh on their margins. So at the end of the day if we get closer to that digestion phase of this data center build out, then these are going to be the ones, Oracle is going to be the ones to feel it first core weave, these Neo clouds are going to be the ones to feel it first. And when you think about the balance sheets that the other hyperscalers have and their ability to speed up spend the way that they have, it just is not the same category in my opinion. And I'll just say this on the Oracle, you're talking about 40%. This stock had a $680 billion market cap yesterday. If you're finally joining the party here, if you're finally saying we need to get more long Oracle up here near a trillion dollar market cap, I think you're kind of doing it wrong. And I think there's probably other ways to express this view in a manner that actually makes more sense in a less crowded field. So when I think about their market share. Yeah. Can they grow market share off a really low base and is that going to be the sort of eye popping sort of guidance that they can give? But I'll just mention this and maybe they can pull up Broadcom here from December. You remember they gave that huge guidance range looking out to 2027 and stock went up 40% in a couple of days we'll go back and look how much it gave it all back. Now I know that this company is executing, I know that they've gotten a bunch of big cloud orders, but at the end of the day we don't know that this backlog is going to materialize. And so to me, I just think this is a bit frothy right here.
- [10:02]
Melissa Lee
All right, well our next guest says we haven't entered the AI bubble just yet. He just raised his price target on Oracle to 370from270, reiterating his buy rating. Ben writes of Melius Research joins us now. He's the head of tech research. Ben, great to have you with us. You've had that buyradian Oracle for about a year. So that's been the right call. Got more right last night. But in terms of the big stock pop and where you see the stock going at this point, you know, how do you answer some of those, those questions? Will RPOs actually materialize into revenue? How will Oracle pay for the capex? What sort of margins will it have on this new source of revenue?
- [10:38]
Well, it's definitely a negative mix shift and it's good to be here. Melissa, thank you and I appreciate your shout out on the on Oracle. The it's a definitely a negative mix shift towards lower margin business, but the growth is really crazy. And what was kind of neat about their guidance was that it's not that much upside for this year next, but it really inflects in 2028, their FY28 which overlaps with calendar 27 and then 29 and then 30. And we're talking about growth there. Like where we took, we were saying that we're going to grow 19% in FY28 and now it's like over 50%. So this kind of growth is in a shortage in the market, especially in software where SaaS companies, software as a service is so, so threatened by AI. The infrastructure companies that made the right investments in cloud and their growth, especially in the out years are so much better than these guys that they're getting. You got to get paid for it. So with respect to Dan, if they can pull off this kind of growth, they're going to get paid for it. And it's frankly only it's trading at under 30 times my earnings for FY28 where the revenue growth and flex to 50%. Dan, that's cheap. So, you know, if they can get the RPO converted to revenue, it's going to work. You know, I would say the big risk is whether OpenAI can pull off getting funding and keep growing because their cash flow is negative. So it's. It all depends on Open Air being a stable and thriving enterprise.
- [12:09]
Dan Nathan
Hey Ben, I do appreciate the respect, but we're talking about two years from now, we're talking about a cycle that is already in its third year. Right now we're talking about nearly $1 trillion by its main competitors. Right. Who have basically built out this infrastructure. So, you know, I don't know. As far as valuing this company right now on calendar 2027 in one fell swoop, that seems kind of odd to me.
- [12:36]
Melissa Lee
Well, I think you have to discount some of the risk that, you know, perhaps the RPO doesn't come through because a lot depends on SoftBank giving money to OpenAI and OpenAI getting financing and Open Air being able to execute. So that's the big risk. I mean we all know that most of the RPO is coming from this Open air Stargate slash, OpenAI, whatever they're doing with others project here. And this is huge. What is happening though, that is much better than expected in terms for the chip guys and for the cloud guys, is that inferencing has turned into just this huge, huge razor and blade. Like the best razor and blade model that perhaps of all time, where it's not that you just get a razor and then like get a few blades for the year, like four, you get a razor, you train a model and then you're like getting a thousand blades and it's really something. And I think it's catching everyone off guard. And, you know, I think you're, you're setting off bubble alarms before the bubble even starts. And I think when you look at the industry day in and the day out and talk about what's happening with inferencing, you know, that's the big surprise here. These companies are seeing something. There's a reason Jensen Huang said 3 to 4 trillion in data center capex by the end of the decade. There's a reason Hock Tan was so bullish on his call. These are the two greatest CEOs. You know, I don't want to even put down anybody. These are really good CEOs. So you're kind of saying that what they're seeing is a clown show. And I think it's the exact opposite. I think that people are looking at it and the smartest guys are going, oh, my God. And part of this will go down in history, what you heard last night. So maybe the bubble starts now, but this is what you're seeing. And I would just be careful because we've been building up to this moment and now is starting to have that inferencing halo that could be pretty powerful. And that's, that's our view here.
- [14:35]
So Jensen said three to four, but you're saying two in terms of the TAM for AI by 2030. And I'm just wondering, you know, what if Jensen is right? What does that do to your view on any of the stocks that you cover that are in the space?
- [14:51]
Well, actually, Jensen and I are saying the same thing. What Jensen is doing is he, he's including the dirt in the ground, the walls, the cooling, you know, all sorts of things. Like he may not do the air conditioners. And I'm including just the compute and networking. So when you take Jensen's 3 to 4 trillion, which I think is going to be at the upper bound of that, and then you take a little more than half, 55 to 60%, which could be compute, slash, networking, slash other things in video does, then we're saying the same thing. And I actually was able to back into that number. We put out a big report Monday, and it's just a huge number. And, and I think that with regard to that, you know, what we really need to do is make sure that obviously people are getting a rate of return. I actually think the rate of return reports are very suspect. I actually think a lot of our companies are, unfortunately, what's going to happen here is there's going to be a lot of headcount cuts and stuff like that for AI and we're seeing it at all the companies who have stopped hiring and taking a lot of the leverage. So I think that that shows that AI is showing a lot of return and we're seeing digital labor kind of come in faster than expected, not slower. So that's where we are right now. And we feel like our Tam Number of 2 trillion for compute networking can really make Broadcom Arista in video as well as a few others go up a lot more even from here.
- [16:15]
Karen Feinerman
Ben, it's Karen. Thanks for being on an excellent call on Oracle. So given the news from Oracle last night and where all the stocks have sort of repriced, I know you cover the space, amd, Nvidia, Broadcom and Oracle, obviously if you rank them in order on this same news at these new prices.
- [16:37]
Melissa Lee
Well, I mean, I think right now we literally we're going to remember this call a long time. I think we might be entering, you know, and I don't know what's going to happen geopolitically or whatever, but we might be entering like one of those crazy periods now and it's really hard to figure that question out. We also, you know, at our firm cover a lot of energy companies that are great stocks for a guy like me. But like, you know, the, the, the energy sector is going to be red hot too. But in terms of what we're thinking, when you see a number like that, like the reason, you know, Broadcom could double, maybe even triple if their revenue, we're seeing Broadcom having 400 to 500 billion in revenue by the end of this decade, you know, and getting a pretty healthy revenue multiple on that. So that would mean it at least doubles. Believe it or not, Nvidia can lose share and still get revenue probably 6 if I'm right on the TAM, 600 to 800 billion in revenue. So that one we like. And then if the spending is as big as it's looking and Larry is right and obviously Dan made a great point that a lot still needs to happen, then AMD is going to get some love. Amd, you know, there's a view out there that AMD is going to get squeezed and you can't really have Broadcom doing so well and Nvidia doing so well. But if there's this much spending going around and opening, I can raise money. AMD is going to get a lot of love and then there's a risk the networks Risk the networks is great that that that company is going to wonderfully so maybe I put them ahead.
- [18:08]
Of AMD even Ben, great to speak with you. Thank you.
- [18:13]
Thank you so much everybody.
- [18:14]
Amelias, how would you re rank? Would you re rank your AI sort of stocks your favorites based on Oracle and Broadcom earlier?
- [18:25]
Courtney Garcia
I mean it's tough to to to have Oracle leapfrog in video here. I think you probably want to perhaps rethink Broadcom as you mentioned particularly around inference. What really calls into question and this is a would you rather not is Amazon because that cloud growth vis a vis peers on the last earnings call raised flags and now that you're seeing this spin and you have OCI which is within Google Cloud and Amazon Cloud and you're still not seeing the growth that we've seen from Azure and some of the others. That makes me scratch my head and want to kind of go back to the table and look as to why they're not seeing the same type of growth that some of the other peers are.
- [19:08]
Melissa Lee
All right, let's turn out of rates dropping ahead of tomorrow's CPI for the yield on the benchmark 10 year treasury closing back in on 4%. Economists expect consumer prices rose slightly more than they did in July with an annualized rate just under 3%. We did see a surprise drop in wholesale prices in August. This morning the pie fell by 110 of a percent while consensus estimates expected an increase. So that was a nice surprise. So companies may not be passing on increased costs here. Courtney, how do you feel about what we're going to get in the 10 year going to 4% and that's basically an April low.
- [19:42]
Vonnie Quinn
Yeah, I mean I think what we really need to see how CPI comes out tomorrow because this was like a big surprise. I mean theoretically if this is a trend you would actually see deflation. But I think it's way too soon to actually say that. So you need to see what this other data is going to come out to show what that trend is going to be. But I do think at this point it is indicative that the rates probably are going to continue to come down here if you continue to get these kind of reports and that is going to be a positive for the markets. But again we want to see what the report comes out tomorrow.
- [20:07]
Karen Feinerman
I was surprised actually the market wasn't up more on this. I know there was some big Dow movers like Apple that took a lot of points but, but for even you know, the whole thing spiders, all of it. I'm surprised because that the magnitude of that data was big.
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Melissa Lee
Now we'll, we'll have maybe too big.
- [20:23]
Karen Feinerman
Maybe too big, and maybe we'll see that something very different tomorrow. That could be a reason. But that auction, those auctions went very well. All of that. You know, you have to think if you were on the fence about the Fed cutting, right, and this data is not completely flipped, tomorrow you have to think they must cut. And you know, two or three weeks ago that call for 50 basis points, I thought, all right, that's a little dramatic. That's, you know, labor isn't, isn't weakening enough and we still have inflation and now both of those things seem to be turning. So I'm on that. I'm surprised the market wasn't actually up.
- [20:59]
Melissa Lee
More coming up, Another IPO pop, how Klarna fared in its market debut and where it stands among the fintech players. Plus another tough day for the trade desk. Shares hitting a five month low after a bearish call on Wall Street. What's got analysts so skittish? We'll get some answers. Don't go anywhere. Fast money's back into how will you.
- [21:16]
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- [22:48]
Melissa Lee
Welcome back to Fast Money. Buy Now, Pay later company Klarna making its market debut today. Shares opening the day at 52. That's well above their IPO price of $40. But Los Steam throughout the session, ending the day up just over $5. The stock now has a market value of over $17 billion. At its peak in 2021 funding round, it was valued at $46 billion. Dan we should also note that, I mean the range is much lower. So this is, you know, by all accounts very successful IPO, even if it fizzled during the session. It's a 20 year old company too. It's been around the block.
- [23:22]
Dan Nathan
Yeah, I think that's worth noting. I mean a lot of these IPOs that we're seeing, they're not kind of newbies here. And so for them to kind of test the market I think is interesting. This did not trade well. Let's, let's be clear, right? If you look at Chime in the fintech spake, that was an IPO in the last couple of months that has not trade particularly well. When I think of Buy Now, Pay later, they might be doing very well in this environment where you're just starting to see, you know, the labor market weakening a little bit. You're starting to see the bite a little bit from, you know, tariffs and trade and the like. But there's going to be another phase of this on the other side of this. If we do see unemployment going up towards 5%, we're going to start seeing delinquencies. Right. And that's when these models really start to have a difficult time. So again, you know, you talked about those valuations in 2021. They were a bit silly. You look at it right now and you know, it's a different cycle for a lot of these names. So I just don't find it particularly interesting. Interesting this Klarna or China for that matter.
- [24:17]
Melissa Lee
Yeah, I mean a lot has happened since 2021 in buy now, Pay Later. A firm is the closest comparison I would say to I have a firm.
- [24:24]
Karen Feinerman
Yeah, I like a firm. Although, I mean it's had a nice run up there was down today on this. I don't know if people thought, oh, partner is going to trade fantastically well in a firm will too. And then it didn't do badly. But I kind of, I do like the space. I do like Buy Now, Pay Later.
- [24:40]
Melissa Lee
There's a lot more Fast Money to come. Here's what's coming up next.
- [24:45]
Commercial Announcer
Rotten Apple shares of the iPhone maker dropping the day after its big product reveal why the stock continues to struggle and whether it can get back into rally mode. Plus the state of retail trading what one exchange CEO sees in store for investors as markets, rates and trading tools can continue to change. You're watching Fast Money live from the NASDAQ market site in Times Square. We're back right after this.
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- [26:18]
Melissa Lee
Welcome back to Fast Money. Shares at the trade desk falling today after a downgrade from Morgan Stanley analysts pointing to mounting competition in ad tech from the likes of Amazon. Julia Boorson's got the details here. Julia. Hey Melissa. Well, the trade desk finished the day down about 12% on news that shows growing competition from Amazon's ad platform. Now this morning, Amazon Ads and Netflix announced they're partnering for Amazon to offer programmatic buying on Netflix's ads platform. This gives advertisers using Amazon's DSP access to Netflix's ad inventory. Netflix is also partnered with the trade Desk, Yahoo and Microsoft. But this news feeds growing concern about Amazon eating into the trade Desk's market share. Now ahead of this news, the trade desk was already down about 4% on that downgrade. It's now down about 60% year to date. Morgan Stanley cutting its price target writing Amazon's DSP is expanding faster than expected and key questions now are whether restructuring can meaningfully reaccelerate growth in the near term and whether the trade Desk can defend its leadership in connected TV against competitors including Amazon. Melissa. All right, Julia, thank you. Julia Boorstin, Trade Desk has been a rollercoaster ride for a long time, Dan. Really threatened by some of the other, you know, ad offerings out there, even like a Netflix. And on top of Amazon.
- [27:45]
Dan Nathan
Yeah. You know, last quarter they had their first revenue miss and I think 33/4. And you know, that's the sort of thing that just kind of highlights a decelerating sort of growth story and that's why you've had that volatility over the last few years. You talk about competition from the likes of Amazon. We know that that ad business has been a great driver of profitability for them, especially when you think about just that kind of North American retail and how low the margins are and also picking up some of the slack that you've seen from us as it seemed decelerating growth. So when I look at a story like this, I say, well, they also have problems with like the meadows and the Googles and the walled gardens that exist there. So this is a tough place to be. I don't even know if valuation works right here because that out year probably has to come down as far as estimates for earnings and revenues.
- [28:34]
Melissa Lee
Yeah. I mean if you want to be in the space, you might want to look at a Metta or Netflix which has the offerings that.
- [28:42]
Karen Feinerman
Right.
- [28:42]
Melissa Lee
Or being used. Yeah, exactly right.
- [28:45]
Karen Feinerman
Which got him into this somewhat. Yeah. So I mean that's, I mean, met for so many parts of the advertising business. Metta is really just a huge threat.
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Courtney Garcia
Yeah, yeah, I would, I would tend to second that. You're starting to see that this really isn't a monolith. And this is particularly concerning after you already saw that massive sell off on the back of last quarter's earnings. So the continued price action down is starting to give me some pause. I know there's long term support. I think we're looking at five year lows flirting with that around 4142. So I think if we break through those levels, it's really tough to defend this name.
- [29:19]
Melissa Lee
All right, well, I think we're going to do. Hear that? Do you hear? Oh, you hear it now you see the countdown clock. We are not counting down to Christmas, but instead we're counting you down to the next Fast Money Live coming to the NASDAQ here in times square. On December 11th, we'll be hosting another live in person event. Fast fans will come here and watch the show, maybe get a question live on Fast Money. Raise A glass of holiday cheer with all of our traders. Look at those stockings. They're already stuffed. It's the first initial of each of the traders here on the show tonight. By the way, scan the QR code on your screen. Head on over to cnc.com fastmoney to get your tickets. What could be better than New York at Christmas time? A front row seat to Fast Money live. We are trading the holidays, opening some stocky stocking stuffers from the traders early. It's going to be Courtney's first Fast Money LIVE event. Second, actually.
- [30:11]
Vonnie Quinn
Yeah.
- [30:11]
Melissa Lee
And it'll be very exciting. You're so excited. You're wearing the hat. So excited.
- [30:15]
Vonnie Quinn
It's going to be the Santa Claus rally. It's going to be good times in the markets. You obviously can't miss this. And yeah, coming here with the Fast Money crew.
- [30:21]
Melissa Lee
And Von Owen's going to wear a hat, too.
- [30:25]
Karen Feinerman
I thought we were unveiling a new acronym.
- [30:27]
Melissa Lee
I got to say that's what Dan proposed, I think. Dan, are you getting your acronym ready because you love the acronym game?
- [30:35]
Dan Nathan
Well, I think the Fast Money Live fans last, you know, last show figured out how I kind of feel about the acronym. But I'll roll one out. That's what you need.
- [30:44]
Melissa Lee
All right. We will do it. So scan the code, get your tickets. It's going to be a great event. December 11th. Meantime, coming up, the state of retail trading. CME Group Chairman and CEO Terry Duffy joins us live from the Robinhood conference in Las Vegas. His take on markets, rates, how it's all going to impact retail traders. That is next when Fast Money returns. Welcome back to FAST money. Stocks mix as investors await tomorrow's CPI number. The S and P and Nasdaq both notching fresh record closes but the Dow falling more than 200 points. Novo Nordisk announcing it will cut 9,000 jobs or about 11% of its global workforce force as the Ozempic maker looks to lower costs. Shares have been cut in half in just the past year. Apple continuing, continuing lower today. Investors have been unimpressed with the new hardware offerings announced at yesterday's event, which included the thinnest iPhone to date and updated AirPods chip design software provider Synopsis plunging nearly 36%, its largest drop ever after missing top and bottom line estimates last night. Today's drop erasing all of this year's gains. And shares of Opendoor, they are on the move in the after hour session, higher by almost 9%. The company naming a new CEO, Kaz Najadian, Co founders Keith Roboyce and Eric Wu will return to the Board of directors. So we're watching that one. Moving on. Terry Duffy is one of the Hood Summit's featured speakers on active trading. CME Group Chairman and CEO joins us now from Las Vegas. Terry, it is always a pleasure to speak with you.
- [32:09]
Terry Duffy
Thanks, Melissa. Pleasure to be with you.
- [32:13]
Melissa Lee
The products that trade on the CME used to to be the the bastion of of institutional traders, but now have crossed into the retail trading, which is probably why you are at the Hood Summit. I'm wondering, Terry, in terms of the percentage accounted for by retail investors, what is that percent and how has that been growing?
- [32:33]
Terry Duffy
Well, mostly it's been growing exponentially and Robinhood is a great example of that along with my other retail partners. But Robinhood just came online is CME within the last year or so and they're our fastest growing partner on the retail side. But we have many other participants that are in on the retail business coming into CME Group. There's more. People want access to markets. Melissa, I've been saying this to you and your other co hosts for a number of years now. People want access to markets. I truly believe that they should have that access whether they're institutional or retail. And the technology today is amazing. Gives them ability to education is something that's critical. I know that people talk about mixing gaming and markets together. Is that good for markets? You know, I think that there's been so many traders throughout history. What's the difference at this point? So I think that people need to participate and do it at a pace that's in their best interest.
- [33:25]
Melissa Lee
Yeah, part of what Robinhood announced today, Futures trading, which is going to be launched today. Overnight index trading, which will be launched in 2027. 6. How key is a retail trade in terms of being a driver of your growth?
- [33:40]
Terry Duffy
Well, it's a component of it, Melissa. It's not the only part. I don't want you or your viewers to think that I have, you know, abandoned the institutional trade. We haven't. It's a huge part of CME Group and what we do. But you cannot put your head in the sand to think about. By the year 2040, there could be roughly $85 trillion of wealth transfer to people of age 24 to 40 that are going to want to do business business in a different way than maybe someone my age want to do today. So you have to be prepared for all different segments of business, not just for today, Melissa, but for the future as well. And that's what I'm trying to position CME to be.
- [34:15]
Melissa Lee
What do you make of the markets? Terry and I I asked you that, you know, as the head of a financial services company, financial firm, where we are in terms of the record closes we've seen seen on the S and P as well as the nasdaq, despite some uncertainty still in the in the economy.
- [34:31]
Terry Duffy
Well, the markets are pretty interesting right now, Melissa. And I know that everyone's anticipating or baking in a Fed cut next week. And I suppose we would be able to get it because the markets sure seem to be pricing them in to a certain degree. But when I look at our world and how people are managing that risk, we're sitting at 135 million positions open on CME, which is not too far off of a record. So that tells me a couple of things about the markets, Melissa. People anticipate it, but they're also hedging up their exposures using CME's products. So from a market perspective, there's a lot of different things going on. Geopolitical, which everybody thought was going to have a major impact on markets, seems to be yesterday's newspaper. So what else is there? We all focused on the Fed. We're focused on artificial intelligence, we're focused on technology. So again, I think that the markets are trading unbelievably. I think if you would have told somebody we'd have $37 trillion of debt in the United States and the equity markets be priced where they're at today, they certainly wouldn't believe you. But I definitely think that's why we're seeing a tremendous amount of hedging going on at CME by the institutional participants.
- [35:35]
Karen Feinerman
Terry, it's Karen Feinerman. Thanks so much for being on. I know you trade a bunch of things, interest, equity, energy affects agriculture. Do you think there's another category out there that will be big enough to actually be a line item for you? What would that be?
- [35:51]
Terry Duffy
Yeah, Karen, I think there will be, but I also think it will have everything you just outlined in it. So the question is, how is it distributed? Who's doing it and on what platforms around the world. So I think there will be the next great idea that will come come forward. Efficiencies are critical, Karen. Tokenization of cash markets is something that I think is very important for the efficiencies of cash markets. I think there will be different line items of trade that will pop up through either the crypto world, the blockchain world, or our traditional products that we have today, which would be a restructuring of some of the products to tailor fit the users of tomorrow. So, yes, I do. Karen, think that will happen.
- [36:35]
Melissa Lee
Terry, we're out of time. It's always great to speak with you. We hope to see you in person soon. Maybe you can come to our Fast Money Live event.
- [36:42]
Terry Duffy
I would love it. Thank you very much, Mel. Appreciate it.
- [36:45]
Melissa Lee
All right, Terry Duffy, cme. This is a stock wise, very strong performer.
- [36:53]
Courtney Garcia
Absolutely. You know, and you think about kind of the history of risk markets and you had single stocks and then you had ETFs and then broader indices. Now we have, you know, crypto. And if you kind of look at the growth segmentation, you really have it concentrated in two segments, which is options and crypto. And so as long as those things are trending higher, I think those kind of correlate strongly with the retail trader. I think when you start to see any type of pullback in those particular segments as of right now, given their business mix, that would kind of be the canary in the coal mine.
- [37:23]
Melissa Lee
Yeah.
- [37:23]
Vonnie Quinn
I mean, the retail investor really has become a force to be reckoned with. They really used to just be like written off as a dumb money and they weren't a lot of active trading and you see a lot more trading activity happening from the retail trader. And I think what's interesting too is when you look at the margin debt right now, I think it hit over $1 trillion right now. But people are not the retail traders are not only optimistic, they are taking margin to get into the markets right now. And I think the only thing to be cognizant of is this can be a little less reliable than an institutional trader. They do tend to trade more when markets are doing well because you get that FOMO or that fear of missing out. They trade less when markets are down. That didn't happen this April, though, is the retail traders who are buying in and not the institution. So maybe that's starting to change. But I think from an investment standpoint, like it's not as reliable as income sources institutions.
- [38:08]
Melissa Lee
Coming up, a new tool for weight loss at a fraction of the price of GLP1 drugs. The CEO of Cygnos joins us next with more on how the company's glucose monitoring system could disrupt the obesity space. Back right after this. Welcome back to fast money. As many patients wrestle with barriers to GLP1 drugs, one health tech startup is betting big on the role of wearable devices. Signos is the first company to get FDA approval for its glucose monitoring system for weight loss, giving patients real time insights into how to diet, exercise and lifestyle choices that impact metabolism. For more Signos CEO Sharam Faladar Mercer joins us here on set. Sherem, great to have you with us.
- [38:47]
Sharam Faladar Mercer
Thanks for having me here. I appreciate it.
- [38:49]
Melissa Lee
Tell us how this works.
- [38:51]
Sharam Faladar Mercer
So we're on a mission to tackle the obesity epidemic. So we're leveraging AI and your glucose, and glucose is your body's primary source of fuel. So we're taking a continuous glucose monitor or a biosensor that we provide you, and we use that to look at your metabolism in real time to see how your body's decisions are affecting your weight throughout this entire journey. And really, the focus is how can we help you see this continuously? It's almost like a Bloomberg terminal for your metabolism.
- [39:23]
Melissa Lee
What will the data tell me? I mean, if I. And let's explain. First, the device. It's a small wearable device. You attach it to your body. It has a micro needle that you put it on. You wear it for 15 days, you throw it away, then you change it. So you have this all hooked up, you see it on your phone, and you see all the information. What do you do with that information? Glucose spikes after I eat. What do I do with that?
- [39:43]
Sharam Faladar Mercer
Yeah. So the key really is how do we predict what's going to happen before you step on the scale? So it's being able to give you the information such that you'll know, should I go for a small walk after this meal, is this meal going to spike my glucose and cause me to ultimately gain weight, maintain my weight, whatever it may be, and give you these little nudges at the right moment, at the right time to help you along that journey? It really is designed to empower you, to help you and be healthier.
- [40:06]
Melissa Lee
How much does this cost? And have any insurers indicated that they would cover it?
- [40:11]
Sharam Faladar Mercer
It's $129 a month and it's FSA HSA eligible. We're now starting to work with insurers to figure out the optimal, optimal way to get this reimbursed for customers.
- [40:20]
Melissa Lee
How do you see yourself fitting into the weight loss space with GLP1s out there? Are you a companion? Would you replace?
- [40:29]
Sharam Faladar Mercer
Yeah, I think. I think it's a complementary solution. GLP1s are a very powerful tool. They're really designed for individuals that are obese. Whereas Signos is really focused on being accessible to all Americans and throughout the entire management of your weight journey, this could be with all the way to maintaining your weight. And I think what makes this particularly interesting is how do we look at this and say, when you go to the doctor's office, you often will have four vital signs measured at a point in time. What we ultimately want is them to measure your fifth vital sign, which is your metabolism. And so what we're doing is we're giving you that ability and having it be continuous so you can see it in real time and empowering you to be able to do that when you're not at the doctor's office on your own.
- [41:08]
Melissa Lee
So the FDA approval is specifically for the devices in use for weight loss, or is it just the FDA approval is the accuracy in measuring glucose levels?
- [41:16]
Sharam Faladar Mercer
It's for. The FDA clearance is actually for management of your weight. So that could be weight loss, maintaining weight throughout that whole spectrum.
- [41:24]
Melissa Lee
How do you see the category broadening then? Obviously, it's useful to measure glucose in many other ways.
- [41:30]
Sharam Faladar Mercer
Yeah, exactly. And I think when you start to look at the benefit of when you're on that weight loss journey and being so successful, I'll use a personal story. My wife and I had newborns, and of course, the recommendation we get is, why don't you guys just sleep eight hours a night? That's a really tough recommendation, as you might imagine. And so, you know, a wife is sleeping four hours a night, and so am I. And so what we saw, and she was excited to go on this, she was very excited that she lost the weight. But what was more interesting is that her deep sleep tripled after we stabilized her glucose. And so she still slept four hours a night, but she felt like she slept seven or eight. And that is just the beginning of some of the benefits you start to see when you're on that weight management journey.
- [42:11]
Melissa Lee
Are you worried about being displaced in any way or how does this fit into Apple's push yesterday with wearables and wanting to be sort of that hub for health? Do you fit into that ecosystem? Could you be a target?
- [42:24]
Sharam Faladar Mercer
Apple's a great, a great solution. And we integrate into all of those types of smart rings, watches, devices, including the Apple Watch. What we see is those devices are very powerful, but they're showing you your data and what it used to be and what it was. And so what we're doing is we're taking AI and saying, how do we predict what's going to happen so that you can see those results in advance so that when you step on the scale, you already kind of know.
- [42:50]
Melissa Lee
Wow. Sharon, thank you so much for coming by and telling us about the device. Keep us updated.
- [42:55]
Sharam Faladar Mercer
Thank you for having me. I appreciate it.
- [42:56]
Melissa Lee
Cygnos is the name of the company. This sounds really, I mean you're very into fitness, so this sort of piqued your interest.
- [43:02]
Courtney Garcia
Yeah, I mean there's a lot of new research around insulin response and this is essentially like a, from my understanding, a mark to market, if you will, in terms of your glucose. And I think, you know, it lets you make informed decisions about what type of foods you should be eating and what your glucose response is. And what particularly strikes well with hits home with me is the deep sleep. I suffer from all types of insomnia and things of that nature. So if I can understand how my food decisions are going to impact my sleep, I definitely would be interested in checking it out.
- [43:30]
Melissa Lee
Coming up, trading and posting how Robinhood's new product is allowing customers to tout their latest trades and the impact it could have on retail investors. More Fast Money into welcome back to Fast Money. Robinhood taking a dip into social media, announcing a new in app platform called Robinhood Social which will allow users to post trades and follow or comment on other investors activ. The feature will be rolled out to select customers early next year with a wider release to follow. Robinhood will also offer short selling, futures trading and new custom indicators. This all announced today at the company's annual Hood Summit in Las Vegas, which is where Dan Nathan finds himself. So Dan, I'm just curious, you know, you're walking around talking to retail investors. Are they excited about stuff like this? They excited about the markets? Are they actively trading?
- [44:17]
Dan Nathan
All the above, Mel. So I've been here for a little over a day. I've talked to dozens, maybe 100 or so of these retail traders and they're not just traders, they're investors. And you know, one of the things that they announced last year at this event was their legend platform. And this is institutional grade platform for folks that, you know, have been stuck on apps and some very, you know, clunky sort of, you know, platforms in the past. So they've given the tools now as they roll out different products, event contract, contracts, futures and the like, that platform is ready to go for this. But the most important thing, I think the thing that got most of these people here, and there's nearly a thousand people here excited is this sort of social platform. We think about engagement, we think about education, we think about how all these things are combined in the financial kind of media here and I think it's going to be a really nice connectivity. We're all sick of arguing with anonymous bots on Twitter and this is a way to kind of, you know, guarantee identity. And it really is exciting thing. I think a lot of these folks here are going to be pretty active on that platform, on that social platform next year when it rolls out.
- [45:21]
Melissa Lee
I mean obviously this has been a monster of a stock. The latest pop is on back of S and P inclusion. But creating this ecosystem where you capture the trader earlier in life, you keep them throughout by offering various products, you have this other social component which keeps them engaged. That's all part of the proposition.
- [45:38]
Courtney Garcia
I really couldn't agree more. I think they found a way to one, as they said, democratizing trading and access to risk markets and now adding in that social aspect that, as you said, kind of extends that life cycle of the customer.
- [45:52]
Melissa Lee
Up next, final trades. Time for the final trade.
- [45:57]
Dan Nathan
Dan Nathan yeah, You're going to be surprised. I like Karen's idea on the put calendar in Oracle call.
- [46:06]
Melissa Lee
Makes her think twice. I think.
- [46:07]
Courtney Garcia
Bono in speaking of Oracle, in light of those, in light of those earnings, I really think you look at us modestly cautious here.
- [46:15]
Melissa Lee
Karen When I was putting it on.
- [46:16]
Karen Feinerman
I thought, oh, Dan would definitely like this for sure. I really do think that OIH in the acronym it's got a ton of upside hopefully because it's had a lot of downside so far this year.
- [46:27]
Vonnie Quinn
Corey I also energy space xle. It's kind of that next gen of AI. You actually want to be in this space.
- [46:33]
Melissa Lee
All right, that's it for us all.
- [46:34]
AARP Narrator
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 Ten years from today, Lisa Schneider will trade in her office job to become the leader of a pack of dogs as the owner of her own dog rescue. That is a second act made possible by the reskilling courses Lisa's taking now with AARP to help make sure her income lives as long as she does. And she can finally run with the big dogs and the small dogs who just think they're big dogs. That's why the younger you are, the more you need AARP. Learn more at aarp.org skills.