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CNBC's "Fast Money"
SpaceX IPO Soars in Trading Debut… And Looking Ahead to Warsh’s First Fed Meeting 6/12/26
00:43:23
SpaceX’s public debut on the Nasdaq makes history, reaching over $2 trillion in market cap and minting Elon Musk as the world’s first trillionaire. Wedbush Securities Global head of tech research Dan Ives breaks down SpaceX’s first trading day and where the space stock is heading next. Then, the traders discuss what a potential peace deal with Iran means for the oil market, and what to expect from Kevin Warsh’s first Fed meeting next week. Plus, SpaceX isn’t the only stock soaring - why retail and chip stocks are also on the rise, and why software is falling short. Fast Money Disclaimer
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- [01:02]
Melissa Lee
Live in the NASDAQ marketsite in the heart of New York City's Times Square, this is fast money. Here's what's on tap tonight. Space X blasts off the record breaking ipo soaring nearly 30% in its first day of trading with the market cap rising above $2 trillion. What the market debut means for investors now. Today's pop minted the world's first trillionaire. Plus Wednesday's wash decision. The new Fed chair gearing up to lead his first central bank rate meeting. The potential shift in policy as well as the Fed's communication style. And later, the ret stocks rising to records. Software's June swoon continues in another big chip call. Why analysts are amped up on amd. I'm Melissa Lee, come to you live from studio BE at the nasdaq. On the desk tonight, Tim Seymour, Karen Feiderman, Steve Grasso and Mike Koh. And we begin with the historic day right here at the Nasdaq as Space X officially took the title of biggest ever ipo. The company's CEO and president, Gwynne Shotwell was joined by employees right here at the Nasdaq to open the trading session while CEO Elon Musk simultaneously, simultaneously rang the bell from Texas. And just before noon on the east coast, we had liftoff. The stock opening at $150 a share, marking 11% gain over the $135 IPO price. After hitting highs of more than 176 bucks a share, it ended the day higher, 19% to $161. In a rare move, Space X Then rang the closing bell here at the Nasdaq to finish out the session. Just across the street, the Times Square ball rising as a tribute to a rocket ship. Today's close brings SpaceX's market cap to over $2.1 trillion, making it the sixth largest public, just behind Amazon. It also brought Elon Musk's net worth to more than $1 trillion. So now that we've seen the stock deliver in its first trading day, what does its flight path look like from here? What are the risks that still lie ahead? Karen, what are your thoughts on this day?
- [02:54]
Karen Feiderman
A very interesting day. Surprisingly smooth. Yes, right. Surprisingly smooth. I think Elon price it himself. I think he did sort of a perfect job. You don't want it to be too high, too low. And I think he got it just right. I was surprised how early they got it open. I thought that would take much longer. And it opened at just about the bottom of its range traded and then so I thought it sort of went off perfectly. If this was a, you know, this was a rocket launch. Outstanding execution. So.
- [03:21]
Melissa Lee
Right.
- [03:22]
Steve Grasso
Yeah, I thought the same thing. If you think about all those touch points that could have been terrible. We've, we for the last two weeks have heard about all the nightmares of the Meta IPO or all these other failed IPOs that lose 50, 80% of their value within a year and they don't open till 2pm so this was a success on any level that you would gauge it on. I think the kudos to the Nasdaq, I think they did an excellent job in opening it. Now what do you do with the stock? Such a light float if you were lucky enough to get an allocation. I think what you do is sort of play the next 10 to 15 days, maybe 30 days possible weakness. But you have the MSCI inclusion, you have the NASDAQ inclusion and the Russell at the end of the month. So you have three indices that are going to include it. Ton of passive money coming into it. Even if without S and P and with such a light float. So you could have some weakness for 10 to 15 days. Then it's just simple math where this is a scarcity of value here or scarcity of opportunities. This stock probably has nothing to do but squeeze higher after that first week and a half of a sell off
- [04:34]
Melissa Lee
until the first walk lockup wave releases. Tim. I mean there's always that opportunity potentially.
- [04:42]
Tim Seymour
That's why I kind of feel like between the indices that need to slowly kind of ramp up and that the lockup really, the lockups not until mid August are some of the ones a lot of the pre, pre IPO buyers and will be sellers or places where I think you're going to see more liquidity at the market. I think independent of market dynam. Not only would I echo the same thing, I would just say not only orderly, but I would say major relief and major relief even for the trade because I, I still think as much as we're talking about doing all kinds of things in space, I also would just go back to the, the February takeout of X AI by Space X as genius as, as certainly being a big, I think the biggest part of the valuation boost here. So what it is a validation for the IPOs to come. Let's be clear. I mean this is at least right now telling you a story that's pretty positive for Open Air and Anthropic. I think the independent of the valuation challenges for a company that lost 4.3 billion in the first quarter and we know the history of companies that are, you know, loss makers in the first 18 months of their trading, it's not great in terms of the return profile, but I think this was a huge success and I think it probably will be well supported even just technically in the next two months before then. Those lockups concern me.
- [06:07]
Melissa Lee
I mean, Mike, does this allay the concerns about a liquidity stock for such a big issue to go go public? And the markets are pretty placid, they are sanguine.
- [06:18]
Mike Koh
I think we can safely say, you know, one of the big questions was how much oxygen is this IPO going to suck out of the room? I mean, what's interesting is that Steve referenced that, you know, it's a, it's a small float kind of funny thing when you consider that it's a $75 billion raise, which is, which is really an epic float when you think about it. It's just a small percentage of the total market capitalization of Space X. The other thing that we know is that going into this there was a tremendous amount of retail interest. I don't think I've ever been asked as many questions about a pending IPO as I have been about this one. And it looked like, you know, the retail allocation, which was going to be whatever 30%, I think of the total raise represented about 20% or just over of the indications of interest on the retail side. And you know, on our trading call this morning, it was, it was the first thing we were talking about and we trade options principally and there are none listed on it yet. So I Think that sort of tells the story that, you know, this was one that everybody was watching. And you know, I would say that just like everybody else on the desk has already, that this went off as close to without a hitch as you can do it.
- [07:27]
Karen Feiderman
So Mike, let me ask you something. So I thought it's going to trade options next week and that will set up into the first inclusion. Is it next Friday and then one, two weeks after for the second index. Does that, how do the options play into that?
- [07:43]
Mike Koh
Yeah, so I mean there's a couple, there's a couple of things that play into it as far as options are concerned. So first of all, some people might ask the question, well, why aren't options options listed immediately anyway? And the reason for that is that there are certain listing requirements for options to trade on a stock. This one is going to meet all of them very easily. That includes at least 7 million shares outstanding, at least 2,000 independent shareholders, a certain amount of trading volume. It's probably going to hit the annual trading volume requirement in about two trading days. Probably. It did it today actually. So there's no question they're going to be listed straight away. But one of the things that will happen once the options are listed is that that sort of starts a virtuous cycle of sorts because that means that a lot of other market participants, including market participants like us, are going to be getting involved with it pretty quickly. So I think that this is, like I said, I mean, it went off pretty much without a hitch. And you know, in some ways I'm a little bit surprised that the volatility wasn't greater. But you know, it traded very well. Intradays is on top of everything else.
- [08:46]
Melissa Lee
Well, Leslie Picker has been following the action all day long and is here with more on this record listing. Start your day at Morgan Stanley. And that was an interesting look because they did it. Yeah, yeah.
- [08:57]
Leslie Picker
They were the stabilization agent for this deal. And a big part of that is making sure there's not too volatile of an open to make sure it doesn't overshoot and then, you know, fizzle out later down the road and make sure there is not enough support at the price that they open. Clearly this was a well executed deal. This is the type of gain that you want to see in an ipo. And it's remarkable that this is a record breaking IPO and everything went off without a hitch. And I'm kind of reflecting back, Melissa, on just the process and how unique it was. The fixed price, instead of coming out with a range the disproportionate amount to retail relative to other deals, the, you know, going against quiet period rules, all of these things. Conventionally, we would suggest you're playing with fire a little bit here. You're setting a fixed price based on what, you know, you're speaking when most executives aren't speaking. And here you have the biggest IPO ever. And it really went off pretty seamlessly.
- [09:54]
Melissa Lee
The other way where this was different was that they had a little bit more impact or say, on the fees for the banks. I mean, it's a lot less than what they. What Alibaba, for instance?
- [10:05]
Leslie Picker
Oh, yeah. In terms of their spread, it was about half what Alibaba generated. Now, the total fee pool on an absolute basis of half a billion dollars, most ever for any deal. But in terms of the actual commission paid per share sold, pretty minuscule. But just given the size of the offering, Goldman Sachs and Morgan Stanley were each able to take home 00 million. And it sounds like that $100 million is pretty, you know, kind of the cap of what any company would pay. And just given the sheer size of this, the spread was much smaller as a result of that absolute dollar figure.
- [10:41]
Melissa Lee
Does this do anything in terms of who gets to be lead for the other big IPOs?
- [10:47]
Leslie Picker
I mean, I think it definitely sends a strong signal that the people who executed this deal, you know, obviously a lot of this depends on relationships and, and lending and things of that nature. So there's a lot of that goes into it. But it doesn't hurt that they can point to this deal and say, look at how well Space X did. That's why you should hire us to be, you know, your lead book runner, your stabilization agent, you know, in charge of your retail distribution for, for the upcoming deals.
- [11:15]
Melissa Lee
Yeah. Karen, Banks have been trading very well lately. Today they were higher as well.
- [11:20]
Karen Feiderman
I know. And I mean, I don't know if it's just the broadening out of the market because other things weren't selling well and that might be part of it. I mean, $100 million is great, sure. But I don't, I think to them or JP Morgan, I think it was 75 million. That's nice, but it's not a ton of money. And the market doesn't put a, a recurring multiple on that. But I do think this going well, bodes well. We do have, as we know, a big pipeline of very big deals coming up. So that bodes well. So. And they were trading terribly before this. Right.
- [11:50]
Steve Grasso
You know, it's interesting when you look at The IPO market without the fixed price, there's been some horrific pricing. You could look at Cerebras where it was $185, came, comes out at 3, 360 or 350, whatever the number was. I think you might see a little bit of that fixed pricing moving forward with the indices. Early inclusion, you can't change.
- [12:12]
Leslie Picker
Right.
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Steve Grasso
What do you think about fixed pricing?
- [12:14]
Leslie Picker
So I've been asking sources about that because now we have a use case. I mean, fixed pricing has been used in select examples a lot of times in Europe. So it's not something that's brand new to this deal. But I'm also told this was largely the way Elon Musk raised money privately. So he was used to just telling investors, if you want, in this round, this is the price, take it or leave it. There was also substantial testing the waters before we even got to the roadshow. So the bankers and the company had a sense of what investors would be willing to pay. They felt confident launching with $135 price, and they knew that they could kind of COVID the book multiple times at that level, and so they were able to go for it. I think the key question is, is this a space, Space X, I suppose, spacebar, SpaceX anomaly, or is this something that can be replicated? I think there's a case to be made that it could be replicated and that it's a very elegant way to run an IPO process, especially if you have a lot of retail involved, because there's no jockeying. I mean, you can imagine a retail investor being like, what is this range?
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Melissa Lee
Right.
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Leslie Picker
Do I mean, like, of course I want. At the lower end of the range, I want the deal right.
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Melissa Lee
You get this price and that's it.
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Leslie Picker
Exactly. And then so it's, it's pretty easy for everybody to understand and there's no jockeying and gamesmanship and psychology involved.
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Melissa Lee
Leslie, thank you.
- [13:28]
Leslie Picker
Thanks, Mel.
- [13:28]
Melissa Lee
Leslie Picker. For more on the SpaceX IPO, let's bring in Dan Ives, Wedbush's global head of tech research. Dan, great to have you with us. I know you've been really bullish of Elon Musk, bullish of SpaceX. Why should space X command such a greater valuation than I would say any of the other stocks you cover?
- [13:51]
Dan Ives
Yeah, look, I think a lot of this is also going to be how Musk and Space X execute to some extent. It is unique because it's the space, it's the data piece, it's AI. You know, as Tim talked about, in terms of X, AI and it's my view in a year from now or less that they'll ultimately merge with Tesla. I mean we think there's over an 80% chance there. And I think those that bet against Mosque over the last decade, it's like betting against the Knicks.
- [14:21]
Steve Grasso
So Dan, when you, when you look at the other, the other IPOs coming down the pike, does this make you more optimistic or is Space X an entity unto itself?
- [14:34]
Dan Ives
I mean to something you could say it's a one of one one, but it does. I mean for anthropic, for open I, I mean this is a huge positive sign for other IPOs. Now you know, as Leslie talked about, obviously the pricing in terms of what they did, it was sort of almost a Goldilocks in terms of here. But look, it's also what do we see across the rest attack? I think it was pretty interesting to see the oxygen getting taken out of the narrative that did not happen. And if you're anthropic or open, I. You feel a lot better today than you did 24 hours ago about this potential process.
- [15:08]
Karen Feiderman
Dan, it's Karen. I think we are almost wearing the same color today. So when you think about sort of the sum of the parts parts here you have two sort of more easily, sort of, I guess businesses you can, I don't know, you can value more easily and then you have the big center one. How do you think about the parts here?
- [15:28]
Dan Ives
Look, I think if you're a believer in space X, it's, it's really about, you got to be a believer. Data centers in space, it's all more around AI and the data play. The view that Space X at one point were more data than basically any other company in the world. And I think that is a name like this. Those that are buying it, they're looking out not a year from now, three, four years now. What could this look like? And it's our view data centers in space. I mean that's something that happens next three to four years. And I think SpaceX is just in a unique position. But Also you're buying SpaceX, you're buying Musk. Musk is SpaceX and that's a huge part of what's happening here.
- [16:12]
Tim Seymour
Dan, Tim, sue. And you dropped us into the way the market closed this week but semis that rallied almost 11% off the bottom. I mean a couple of days ago it was a very difficult environment and just the conversations you're having with institutions and the hiccup we had this week and how we closed? I mean is it game on? Frankly, it feels like it is.
- [16:33]
Dan Ives
I think it's green light. I mean Tim, over the last week I've talked to New York City cab drivers that they're worried about about what was going to happen to tech stocks in terms of with Space X. I mean the point is this has been a huge nervousness in the market and I think now bright green light. We got through this period of sort of white knuckle nervousness and after the sort of Goldilocks day, I think this is a green light especially in terms of chips. What we saw being oversold over the last week.
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Melissa Lee
Did I hear you right Dan, when you said that you thought data centers in space would happen in three to four years?
- [17:11]
Dan Ives
Yeah, I think, I think one will
- [17:13]
Melissa Lee
be in process of being built there.
- [17:16]
Dan Ives
Yeah, I think, I think pre2030 data centers and space is a reality and I think most of some reason you have to be a believer that this is more of an AI data play. It's not just going to be about Starlink and ultimately satellites. I think that, that, that continues to be I know longer term vision who
- [17:38]
Melissa Lee
is building this stuff. I think that you know to say data center space and it's just such a fantastical sort of idea when you think about all the bottlenecks here even in terms of just components in energy and all that and some of that transforms when you're in space in terms of the cooling demands and the electricity demands, etc. But still you still need all of sort of the parts that go into a data center that actually process the data and there aren't enough here and I would imagine there's not going to be any more for a space data center.
- [18:12]
Dan Ives
I think the hyperscalers like when I think Google and Microsoft and ultimately Oracle and I mean this is, they're going to play a huge role over the coming years because it's our view that this is going to be a route that we're going to see on the data center side. And I think as an investor you can just view if you look at SpaceX, it's not just about space and where it is today. It's around a play, it's about the data play. And I think that is something that's going to be routed and that's also when it comes to Musk, those that have bet against him, I was proven wrong again and again and that that's what he needs to prove out this time.
- [18:50]
Melissa Lee
All right, Dan, it's always great to speak with You. Thank you.
- [18:53]
Dan Ives
Thank you.
- [18:54]
Melissa Lee
And it is a lovely shade of Carnation pink. Dan Ives. All right, so Michael, I want to go to you on the notion of valuing and thinking about data centers in space. And you have to believe in that componen component of the story in order to believe in this valuation. I spoke to an early Space X investor on Closing Bell Overtime. He got in like in 2017 and he said, valuation is a framework, it's a narrative. It's not, it's not what you have, what you should hang your hat on. It's sort of just a guidance in terms of how hopeful the future is. Are you in that camp?
- [19:27]
Mike Koh
Well, if you tried to examine the valuation of some other really big IPOs in the past that have turned into phenomenal companies, one of them was actually in some respects a failed ipo, and that was Facebook. I think we were all on, on that day and then we watched a trade to the syndicate bid on the IPO day and trade substantially lower thereafter. The company wasn't profitable at the time, but it has become immensely profitable since. Same thing with then Google, now Alphabet, you know, so if people are thinking about an IPO as, oh, I should be able to value it on a conventional metric, then you're going to look at something like Aramco, which was actually the only other IPO of this size, you know, where the market capitalization was similar, well over a trillion dollars. The thing that you have to look at with SpaceX for me is the fact that they control essentially most of the mass to orbit. Right. So if there are going to be data centers in space, even if they weren't the ones building them, they would be the ones getting them up there because they bring more mass into orbit than everybody else combined, pretty much. So, in fact, not pretty much. They do it. So if you believe in that theory, theory in that idea, then this is kind of the only way to play it. And I think that's why people are buying the stock.
- [20:35]
Melissa Lee
Right. And by the way, all the hyperscalers are talking about data centers in space. So even if, to Mike's point, Elon Musk does not build it, they have to put the stuff on something to get it there, Tim, and that is Space X at this point.
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Tim Urbanowitz
Yeah.
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Tim Seymour
Guess, guess who put 29 satellites into space this morning? I mean, it was Starlink and on a big day for the company. So I, I think that that's an incredibly compelling part of the story. I still don't really know what it's worth, but there's no question that people are buying the future. What have we been talking about with Tesla for years? We haven't been taught, I mean the wink and the nod was EV vehicles, but it really was finally okay, we're now willing to concede that this is, this is a data play, this is a robotics play. This is, you know, so I mean you can't get caught up in the valuation, you can't get caught up in corporate governance. I mean there's, there's nothing that's ever operated like this. And we're not talking about small pockets that are going to fund other big pockets. I mean, do we really know what's going to go on with this balance sheet over the next 24 to 36 months? No. And therefore I'm, I think conceptually this is actually a lot easier for investors to hold their nose on valuation than it is even for Tesla just to
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Steve Grasso
put, just to put evaluation on it or numbers on it. One FCC filing had up to 1 million satellites that he floated out there already. One million of these data centers already. Who's controlling the space?
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Melissa Lee
Coming up, retail rising, the names hitting record levels and how our traders are positioning in the space plus software slide continues as the IGB wraps up a rough week. The stocks leading group to the downside and if the June drop will continue, don't go anywhere. Fast money's back in two.
- [22:28]
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- [23:58]
Melissa Lee
from Wall street to Capitol Hill, the Trump administration indicating optimism today surrounding an Iran deal while saying it's not 100% certain. CNBC's Eamonn Jabbers has a developing story. Eamon
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Eamonn Jabbers
hey there, Melissa. That's right. Iran's Foreign Minister Saeed Aragachi has been releasing some chest thumping statements this afternoon about the U. S Iran deal that's shaping up behind the scenes today, boasting that Iran is the winner of the U. S Iran war and that Iran has emerged stronger than it was before. He says Iran's sword will always hang over the Strait of Hormuz. And he claims that Iran will not charge tolls to cross the strait after the war, but it will collect what he calls service fees. Now here in Washington, a senior administration official briefed reporters this afternoon and cautioned that there's still some resistance to the deal in certain quarters of the Iranian leadership and many of the statements coming from Iran are aimed at selling the deal internally in terms of their domestic politics. This official said he thinks there's an 85% chance of a deal coming in the next few days. He says not clear where the signing is going to take place, but officials are looking at global locations that would be acceptable to both sides at this point. Now, the key, he said, is that this deal is contingent on the Iranians hitting verified benchmarks and that the regime only gets economic benefits from the deal once those benchmarks have been reached. He said we're not quite at the finish line yet, but we are very close. That said, he suggested there's still a lot of work to do, saying that the technical aspects of how exactly the US Would take possession of nuclear material in Iran still have to be worked out given the dangerous and complex nature of that operation. And this senior administration official said that Iranian control, as he put it, of the Strait of Hormuz has weakened in recent days and that was one of the elements that shifted the balance of power in these talks. And finally, Melissa, the senior administration official did not say how much money the US Will be giving the Iranians over the course of this deal. So there's still a lot of pieces here to come together publicly back over to you.
- [26:08]
Melissa Lee
And whether you call it a service fee or a toll, Ayman, it sounds like they're still thinking that they have some degree of economic control over the Strait of Hormuz. And I would think based on past Trump administration statements, that that wouldn't fly at all.
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Eamonn Jabbers
Yeah. I mean, they have said throughout the course of the war that the Iranians charging fees or tolls or anything would be unacceptable to them. The senior administration official who briefed reporters earlier today was silent on that point. So we'll see. It's interesting to me in terms of the optics of this that they're not contemplating having President Trump travel to sign this. He's going to the UFC fight on the south lawn on Sunday. J.D. vance, we think will be the official, the vice president who will travel to wherever it is to sign this. That might give you some indication of, you know, the terms of the deal not being super palatable. Otherwise you'd think the president would want to be there to sign it himself.
- [27:02]
Melissa Lee
Right? Amen. Thank you. Amen. Jabbers. Meantime, retail at records today, luxury retailer Ralph Lauren setting all time highs two days in a row. Home furnisher Williams Sonoma also at new all time highs and Target at levels not seen since February 2025. Maybe part of this is also the decline in oil that we've seen recently. Recently based on some of the headlines that Amen's reporting. Karen, what do you make of retail's resurgence here?
- [27:25]
Karen Feiderman
Yeah, I think oil is clearly helpful. That was very bad and sentiment was very bad. Also the whole rhetoric around the war, just the uncertainty of it, even without the effects of oil I think are not helpful for consumers. So that's good for me. For me the best performing one is all time high today also is TJX which I hope is sort of an all weather retailer. I also have an F which had earnings. Earnings were good, it rallied off of that, but it was very, very low going into earnings. So that's been a mixed bag for me this year.
- [27:55]
Melissa Lee
Yeah, a broadening out trade, Tim, also helps the retail cause, but it hasn't hit them all.
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Tim Seymour
I still think discretionary is under a lot of challenges, certainly subsectors there. We've seen that across athleisure and parts of apparel. But look at a Target and you have a story that first of all a lot of skeptics out there in terms of the sustainability, the turnaround out there, the company themselves. So Fidelke and CFO held a sell side kind of Q and A session where a lot of people came away quite bullish, not run away and still a lot of not clear details but that they are focused, laser focused on top line growth and assortment resets and things that would be supportive of, of a company that does seem to be turning around 60 month highs. You know, 15% move this week in Target. Also the T in Timber, of course.
- [28:49]
Steve Grasso
Yeah. Whether you're looking at TJ Maxx Ross stores or those, those conscious, price conscious buyers. But when you think about it, as Karen said, the high end, a lot of these are coming from a lot of wealthy people in the Middle east and there's a lot of international where that moves the needle for them, whether it be 2 to 10% of their revenue. It's about the perception and the environment that we're in that stabilizes these stocks rally.
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Melissa Lee
There's a lot more fast money to come. Here's what's coming up next.
- [29:20]
Fast Money Announcer
Software sweating it out to start the summer as the IG vetf tumbles into correction territory. The next move in the group and if the traders see any rebound in store. Plus a change in communication, how the central bank's new chief could switch swap out all the Fed speak and why Warsh may keep it to a whisper. Everything to know ahead of next week's Fed rate decision. You're watching Fast MONEY live from the NASDAQ market site in Times Square. We're back right after this.
- [29:59]
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Melissa Lee
Welcome back to Best Money. It was an exciting week for many parts of the market, but not for software. The software ETF IGB down over 5% since Monday. This came after disappointing earnings results from both Adobe and Oracle, which are both down by double digits this week. Salesforce, Microsoft and ServiceNow also ending the week in launch losses. Mike, you flagged Adobe's trading volume. Not only was it results here, it's the CFO leaving on top of the CEO announcing that he would leave, but you know, he announced that back in March or so.
- [31:44]
Mike Koh
Yeah, I mean Adobe is getting onto the list of some of the most actively traded single stock options, but not for any good reasons. You know, obviously people think that the situation is rather grim and there's little sign of improvement. You know, we were just highlighting IGV overall. I don't really paint every single stock in there though with the same brush. I kind of feel that maybe Salesforce to a degree and Microsoft certainly don't deserve to necessarily be in the same camp with the Adobes and Oracles of the world, even though Oracle is of course trying to compete a little bit on the hyperscaler side, but they're taking on a huge amount of debt to do it. You know, for me, I do think that one can start to selectively pick around but, but you want to dip your toe in the water and not just reach out and try to grab a whole bunch of any one of these because there's still a lot of pressure here.
- [32:35]
Steve Grasso
You picking around, Steve, I think eventually you might get a confluence of events here where some of these stocks were obviously under pressure because of AI replacement not wanting to pay $150 per seat on some of these names, whether it's a Salesforce or a. Or a ServiceNow, you have to pick through which ones were used as an ATM for SpaceX. So that could be an add on to it where you could see a pop in this. To Mike's point, look at Adobe is trading at 12 times. You go back not that far, long ago and it was trading at 55 times. So you're getting some discounts here. Now you have to believe in the existential threat to Adobe, which I think that's the poster child for AI replacement because there's so much that could be done. But there are other things that have been thrown out at this point at right rock bottom prices. So you could see this whole sector in the next couple of days rally off of the back of the IPO is over, the ATM is over. So maybe you get a bounce in
- [33:29]
Melissa Lee
some of these names coming up. Warshawn, Wednesday what to expect from the new Fed chair in the central bank's rate decision next week and why the regime change could include a different approach to Fed communication. That's when he's back into. Welcome back to fast money stocks. Adding to yesterday's rally as Space X soared in its market debut. The Dow jumping more than 350 points, the S&P up half a percent and the NASDAQ climbing 3.10of a percent. SpaceX closing at $161 a share. That's jumping 6.19percent after its record IPA surpassing $2 trillion in market cap. And shares of Roku surging more than 20%, the streaming video platform reported reportedly in sales talks, including a possible media tie up. Today's move adding to Roku's positive year, now up more than 32% in 2026. Meantime, the street heading into a pivotal week with new Fed chairman Kevin Warsh holding his first policy meeting on rates. Let's bring in Tim Urbanowitz, chief investment strategist at Innovator from Goldman Sachs Asset Management. Tim, great to have you with us.
- [34:33]
Tim Urbanowitz
Great to be with you.
- [34:35]
Melissa Lee
What will you be looking for first and foremost, you know, when it comes to Kevin Wash, his first meeting?
- [34:40]
Tim Urbanowitz
Well, Melissa, I think this is the biggest Fed meeting we have seen in quite a long time. Not from the standpoint that we expect a cut or a hike, but it's big from the standpoint of investors want to get clarity on a lot of the issues. And I think for us at top of that list is really digging into some of the hawkish comments that he has made here recently and trying to decipher, you know, is that him battling the perception in the marketplace that he's going to bow to political pressures or is this actually how he views the world? I think, you know, the Iran situation, how does he view that? Does he take the Powell approach where it's, it's wait and see, don't, don't react to this, this temporary shock. But when we take a step back at the end of the day, Melissa, I think we're going to have a Fed that is on hold for a very long time here. I don't think there's any way you can justify cutting rates anytime soon. And when we look at hikes, I think we have to ask ourselves a question. What would a hike solve for, for, you know, we have a supply shock here that's driving inflation higher. I think hiking interest rates only puts us in a position where you have slower growth and high inflation, which is exact opposite of what we actually want.
- [35:47]
Karen Feiderman
Tim, it's Karen, thanks for being on. So do you expect to hear for Wash to tell us how he's going to communicate in the future, what might change, what might not. And then also what other things besides just rates that he will be looking at and focusing on?
- [36:03]
Tim Urbanowitz
Well, I think we want to pay attention to what he says on the balance sheet and you know, also this longer term strategy where he views policy as a trade off between interest rates and the size of the balance sheet. What does the timeline on that look like? I think that has big implications for investors if he's able to pull that off. Big, big implications for Main Street. So we're also listening for that. I think it's tbd, how much information he's actually going to give us. But there's certainly things that we're going to be looking to pick up on and it's really important for portfolios moving forward. So we want to be paying close attention and I think the market's going to react in a big way.
- [36:38]
Steve Grasso
Tim, when you look at the, the idea that he's a consensus builder, when I do the math, the math is obviously stacked against him. Should I not worry about whether it's war, Bowman and Waller and then you have the whole lineup against him. Should we just throw all that out and think he's going to run this Fed as a consent to building operation and garbage in, garbage out, or it's just going to be something where he's going to start from, from ground zero and literally talk about the balance sheet, as you mentioned already, but talk about building that consensus and we're going to get a new narrative out of the Fed in the next couple of months.
- [37:15]
Tim Urbanowitz
Well, I think he is a man with big ideas. I think that's why Trump put him in the position that he's in. But can he build that consensus? Because it isn't a one man show. He's going to need to build that consensus internally. I think it's going to take some time. But look, again, I don't think you're going to see any major moves here in the near term. But you know, over the next 612 months, what does that look like? We got to be paying close attention to, you know, and he's in, he's in a very difficult spot. He's coming in, in our view, in one of the toughest times to be in this seat where you have high inflation running wild and things that are somewhat out of his control. So, so I think it's all about positioning our portfolio, continuing to position for higher inflation, elevated interest rates right now. But there's still going to be a lot of unknowns after next week.
- [38:01]
Melissa Lee
All right, Tim, Great to speak with you. Thank you.
- [38:03]
Tim Urbanowitz
Great to be with you.
- [38:05]
Melissa Lee
It's Mike. How are you seeing traders position themselves?
- [38:10]
Mike Koh
Well, I mean from my perspective, I don't think we spend too much time thinking about, you know, who's going to be saying what in the, in those meetings. We really just focus on the two year and the SOFR futures because that's everything that we really can basically trade. Right. So you know, you look at two year rates today and I think that tells you what you need to know if you want to. In fact, I think it's a very interesting exercise. If you go back and you want to know what the Fed fund rates would be, you can go back and take a look at two year rates for Treasuries and you have a pretty good indication. I think the market's as good at handicapping this as anything. And you know, Wash seems like a reasonable guy to me. The comments that he's made in the past, I understand there's a, there's a lot of narratives one way or the other going around it, but focus on the rates and you'll know what you need to.
- [38:57]
Tim Seymour
Yeah, Tim, I don't know. I'm not an economist, although sometimes I'm asked to sort of play one on tv. I don't think this is just supply side shock inflation. I mean I think we've seen input price dynamics that have fed through that were before the war. I think we've got negative real rates and I think policy is too accommodative. I think Warsh is going to do an interesting job of taking the Fed back to where we were at a time when you know, Bernanke went out of his way to say the Fed's going to be more transparent and that's good and bad. I remember Dan Wall street when that payroll number came out on Friday, you really had no idea how the Fed was thinking and how they're going to react. And you had a ton of volatility around. Just big, big data points and whatnot. I think, I think that's actually fascinating. I mean I think maybe there is some level that we know too much. It's much or they have to say too much. But back to where the market is. I think, look, I think the 10 year is still to be watched. I think there was some relief this week. Oil prices will provide tremendous relief, but I think inflation is still an issue.
- [40:04]
Melissa Lee
Coming up, the latest chip call on Wall Street. As the group wraps up a strong week, what analysts see in store for shares shareholders of AMD with fast money returns. Welcome back to Fast Money City. Upgrading AMD from neutral to buy today, saying it is emerging as a legit second source in the GPU market. With the company poised to win the lion's share at Meta. AMD shares popping almost 5% is up nearly 139% this year and chips having a chipper week. But the Semi ZTF SMH up 9% since Monday, led higher by AAM, intel and Teradyne. Tim, what do you think of this call?
- [40:47]
Tim Seymour
Well, I think it's interesting because at one point this was a GPU call and being in second place and on the AM I450 closing some ground on Nvidia. But either way there was plenty of room for them. The fact that they're, you know, we then moved to this whole trade within the CPU market and they reiterate that they think CPU TAM goes, you know, four times from 25 to 29 or 28. So, you know, it's interesting. I'm long AMD, I'm long it for clients. I actually sold a little bit today on a bounce back because I still think we're in a place where we're kind of digesting a little bit of the demand dynamics. But I, I think the call is interesting. I don't think it's all that different, frankly.
- [41:28]
Melissa Lee
Mm. Mike, I'm curious what your thoughts are on intel and the massive run it's had.
- [41:35]
Mike Koh
Yeah, I mean that's, that's quite extraordinary. You know, when the, the government investment in intel first was announced, you know, I think one of the things we learned is that that turns out to be a pretty interesting backstop, if you will. You know, from a, from a technical standpoint, this was a company that really struggled on a couple occasions when it sort of got more business leadership and less sort of technology leadership from the engineering perspective. And they kind of lost their way and they lost it specifically to amd. Largely that wasn't so much on the GPU side as the CPU side, but it does seem like they've gotten a little bit of their mojo back. I mean, it's interesting to me though that when I look at both intel and amd and then I look at Nvidia, which is actually our largest chip position, we do have both intel and AMD as well. That that's the one that still looks cheap. So those others are priced as if they are going to narrow the gap and narrow it considerably, whereas Nvidia is still the one that's in the lead.
- [42:32]
Karen Feiderman
Totally agree with that. I mean to me, right? The part of the knock on Nvidia, well, CPUs now the ratio is changing. Got to be in CPUs. AMD, CPUs. I have some AMD, I have way more Nvidia, but now AMD GPUs and CPUs. Well, Nvidia's, GPUs and CPUs as well. And much cheaper. Not growing as quickly, but very still rapidly growing. Much cheaper.
- [42:54]
Steve Grasso
I think if you buy any of these chips, it goes back to the same thing. They've been under so much pressure for so long. Long it was the rinse and repeat where they came out of the chips. They went at the software, came out of software, went back in the chips. I think for the next week or so you're going to see all of them rally because everyone's forgot about them. Space X Eclipse, everybody else. But I would not be buying in video. I'd be buying the host of other names as they branch out for for capital appreciation.
- [43:18]
Melissa Lee
Coming up, today's massive Space X IPO minting Elon Musk as the world's first trillionaire. The math behind the net worth boost and the billionaires trailing behind it. More fast money into. Welcome back to Fast Money. Elon Musk becoming the world's first trillionaire today on SpaceX, his public debut. But what's the math of how he got here? And how does Musk stack up to all his other wealthy friends? Robert Frank is here with more details. Hi, Robert.
- [43:50]
Eamonn Jabbers
Melissa.
- [43:50]
Robert Frank
This math has a lot of zeros, so get ready. So at the close, Elon Musk stake in SpaceX worth over $800 billion. You add to that his Tesla wealth of around $280 billion and Elon Musk is now worth $1.1 trillion. He's not only richer than other billionaires, it's like he's on his own financial planet at this point. His net worth more than three times the world's second richest person. That's Larry Page. And he's worth more than the next five richest billionaires in the world combined. His personal fortune also larger than the GDPs of Sweden, Ireland or Taiwan. If Elon Musk spent $25 million a day for the next 100 years, he would still have billions of dollars left over. Today's IPO added more than $300 billion to his net worth. So he added a Jeff Bezos today and is now worth seven Warren Buffetts. The Space X IPO also creating thousands of new millionaires from employees who had stock. We should Add that Gwynne Shotwell, who we had on our air today, is now worth $2 billion. Still not bad guys.
- [44:58]
Melissa Lee
Not, not shabby at all. Robert. But of course, this in doing the calculation, you excluded all of the stock options that could come to him if he's hit certain milestones. So he could be even far richer than the trillion dollar number that you're outlining.
- [45:15]
Robert Frank
Yes. If he colonizes Mars and gets 1 trillion terawatts of compute whatever that number is, then he gets another billion dollars in options. So that would take him even further.
- [45:28]
Karen Feiderman
Doesn't he get another trillion dollars in options?
- [45:30]
Steve Grasso
Yes.
- [45:31]
Melissa Lee
Trillion.
- [45:32]
Karen Feiderman
Crazy, not billion. I think. I don't know. Robert. Correct me if that's wrong.
- [45:36]
Robert Frank
On it's 1.3 billion shares at a certain option price. So. So depending on what the value of those shares are at that time, it's going to be that share price times 1.3 billion.
- [45:51]
Melissa Lee
That's a lot of money. All right, Robert. Thank you, Robert Frank. Up next, final trade. Final trade time tempo lower oil prices
- [46:10]
Tim Seymour
but energy shares continue to hold. Serve I think you buy the xle.
- [46:14]
Mike Koh
Mike Nice pop. Today, specialty chemicals maker Albemarle. I think it still has brother to run.
- [46:21]
Karen Feiderman
Karen yeah, you know who owns some SpaceX? Nvidia. I like Nvidia.
- [46:26]
Steve Grasso
Steve Looking for a balance of things that got hurt the most in last week. Inflection Quant Quantum Stock.
- [46:31]
Melissa Lee
Thanks for watching Fast. Have a great weekend. Mad Money Jim Cramer starts right now.
- [46:38]
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- [47:09]
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