← Halftime Report
Halftime Report
Alphabet’s Mega Move 9/3/25
00:44:13
Scott Wapner and the Investment Committee debate the stunning google move and how you should trade it now. Plus, we discuss the latest Calls of the Day on Citigroup. And later, Julia Boorstin joins us with the latest on the NFL season kicking off and the brewing battle between the league and the services that tracks its ratings. Investment Committee Disclosures
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- [00:01]
A
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B
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A
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B
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A
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B
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A
I'm Scott Wapner and you're listening to CNBC's Halftime Report, the podcast the most profitable hour of the trading day. We record this live weekdays at Eastern. Listen in. Carl, thanks so much. Welcome to the Halftime Report. I'm Scott Wapner, front and center this out stunning Google move on the back of that court ruling. We are trading it and the fallout for the other mega caps. Joining me for the hour today, Joe Terranova, Liz Thomas, Steve Weiss, Jim Leventhal. We'll check the markets. It is a NASDAQ story today for obvious reasons. Not the only story. I mean, gold is a new record. Yields are higher. The 30 year boil is off a little bit. Governor Waller tells Steve Liesman could see multiple cuts over the next few months. We'll get to all that. But the big story is the mega relief for the mega caps. Maybe as a whole, certainly for one of them. After the judge rules, Alphabet won't have to break up. Google hits a record high. It is the best day since April Farmer. Jim. Your Honor, Alphabet is now up 39.5% since the so called Eddy Q sell off. That was May 7th. You said everybody piped down. Relax. The stock is just fine. The company's just fine. Now what you say, my friend?
- [02:09]
C
Now I say it's still undervalued and a meaningful overhang has been taken out of the name. You never know what's going to happen with these things. The judge can go any way they want to. But the idea that we would be talking in May, as you referred to Scott, about competition, eating Google's lunch and at the same time that this judge would rule that there's a monopolistic practice practice here at Google. Well, that was the ruling, but that the punishment would be draconian to reflect that monopoly that was completely in Congress. You can't hold those two thoughts together. So although it was not a fait accompli, I'm very delighted. This is the news I expected. And now the overhangs gone and what you've got is a stock that's trading at the low 20s. I think it's about 22 times forward earnings. You compare that to the rest of the Mag 7 and like the rest of the Mag 7, this is going to be an AI beneficiary. Yes, there is competition, but this is Google, a multitrillion dollar company that has been at AI for a long, long time. People don't remember that, but it's been at this for decades. And they have a viable product that's showing up, by the way, in their quarterly results, which I expect will again be the case in the quarter to come.
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A
You catch a fair amount of grief from the bench and now you get some love because, I mean, you told people to just chill, relax, don't make such a huge deal of the Eddy Q thing. Even though it's not like it's an insignificant point that he was making, it's just the stock's up a lot and this is a big deal. Nine target hikes, at least that we could find today. What do you think about this? Jimmy declared this, even with the gain still undervalued. Well, if you look at mega cap valuations, it certainly has a lower forward PE than the others. Do we make that up? Let's show it if we have that. Because Amazon's like at 32 plus times, as is Microsoft. Alphabet's at 21.3 times. Maybe it's a little more now because of the gain that you're getting in the stock today, but nonetheless, does this start to close? Does this closure, if you consider it, that close the gap from a valuation standpoint between Alphabet and some of these other names.
- [04:25]
D
Jimmy nailed it. Yeah. This is removing a significant obstacle and I agree with you. I believe there's further upside potential here. When you look at the sum of the parts, you look at the various businesses and the valuation here, one can think about this company trading with a market cap exceeding $3 trillion very easily. Just thinking about the combination of a very powerful Waymo business, YouTube TV, the cloud business we know is doing well. And when you think about the valuation of Open Air, how that has grown so dramatically to over 500 billion, what does that mean now for the valuation of Gemini and for Google Cloud itself? So it lifts the. It lifts the obstacle. It absolutely is a clearing event. And I also think it benefits the entirety of the AI halo because it gives now Google the opportunity to go out and actually spend money more. Google doesn't have to sit back and concern itself with these antitrust fights.
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A
I'll tell you why this is an antitrust issue. Quite obviously it doesn't eliminate the broader question like the one that Eddy Q raised in the courtroom of whether these large language models and these co pilots and generative AI deals are going to cut into the monopoly that they all but had in search. That's, that's, this does nothing to address that, does it?
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D
That's, that's fair. But it does allow them the opportunity for a very cash rich company to go out and actually spend and defend against that loss of market share that potentially is coming.
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C
So you're pointing out something very important. This is a huge company. The huge companies in any industries win by virtue of their size, by virtue of the resources. Whether it's financial, as you're pointing out, or as intellectual as I was pointing out before, I think this is very important. This is why I was so calm on the Ediq comments to $2 trillion company now. I was surprised that it became a battleground stock. This was one of the more calm moments that I've had when defending a stock. Because of the size which you're speaking.
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A
To Joe, why you want it to obviously do you think it's a value you start to close the valuation gap now?
- [06:44]
E
I think close it somewhat more but I don't think you'll close it completely. This stock is always sold at a discount or generally I don't want to say always because that, that's, that's just too strong term. But generally sold at a discount over the last five, 10 years to some of the others, including Amazon. But here's what it also does, which I'm not aware that most are talking about, about Gmail. Google Mail is the dominant player in mail in the US in email. Without the, with, without the microscope on the francitive activity, they can do what Netflix has been doing now. They've raised prices somewhat, but they can raise prices more now without the glare of antitrust proceedings on them. So I think there are multiple levers they can pull to drive revenue, to drive earnings and I look forward to them doing that. But you know, you know I've thought about this quite a bit. Is that how much of that headwind from the antitrust scene was still in play. I mean the stocks recover from 165 to 200 before this. So you got to believe some was discount. Now it was at 165.
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A
Everybody move in the stock today. It would say that.
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E
I'd say some of it was maybe.
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A
Didn'T expect this outcome.
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E
No, clearly it didn't. Clearly didn't. But you still have the headwind of search share and of giving up some of their data.
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A
I know but the whole point is that maybe all of that was overblown.
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E
No, and I think it was by today. But what I'm saying is that's the reason why it won't recover or it won't go to the extent on a multiple basis that you see Metta and Amazon and others at. So that's my point. You'll continue to see it move up and I think the headwind of losing position search is overstated because they'll still be the one to dominate advertising just because of this year they'll have. So I like it. I'm staying there. I debate about buying some more when the announcement hit but I choose to wait for it to pull back a little bit because I think that's what will happen.
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C
Liz, I'll make this quick. Meta is. You mentioned it. It's the direct comparable multiple here in terms of what the stock does next. Two years ago Metta was trading at a high teens forward multiple. Many people and I think it was you Steve, it wasn't me bought the stock at that point in time and have enjoyed both a multiple expansion and earnings growth. And that's exactly what I think you're going to see with Google over the next year.
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A
I mean aren't you talking about. You're talking about a stock move but you're talking about apples and oranges in terms of issues.
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C
You're correct. You're correct. I'm talking about a stock move in terms of what to expect your absolute. There are some similarities. I mean Steve was just bringing up. Well let me, let me extend this because Steve was just bringing up email. It's only one piston in the engine. There is YouTube which I would say is a direct compar. Comparable to what's going on at Facebook. But yes, yes Scott, there was the year of, you know, building out the Metaverse find followed by the year of year efficiency. I'll grant you. I'm simply saying from a stock point of view, absolutely. Meta is the comparable in my mind.
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A
So Liz, you know you look at this trade lately which has been somewhat in question as you head into a new month. This is just what the doctor ordered. If you can Remove some sort of regulatory and antitrust overhang over this space. What's that do?
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B
I mean it certainly helps. It removes one of the skepticisms that people might have had about current valuation levels. I think we're talking about some idiosyncratic issues with one stock though. But when you look at the trade itself, if we're just talking about mega cap tech or even if we're just talking about semiconductors and everything that has been under pressure over the last, call it, five trading days or so, you can't remove the fact that what's happening in the rest of the market, especially with yields, is probably pressuring them as well. And I talk about the relationship between assets a lot. This is a relationship that I think right now is in tact. You've got long term yields rising and long duration stocks under pressure. That makes sense. This could be a period of time where we're just sort of normalizing to a level of yields that needs to be more rational given the environment, a level of inflation that's perhaps digested by the economy so far. In which case then you look at long term stock valuations, they didn't make a whole lot of sense. Investors were wrapping themselves into pretzels trying to make a case for why it was a buy at these levels. So some of these shakeouts I think are pretty healthy.
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A
It's not just a Alphabet story today, it's an Apple story too. Higher on the ruling because they're going to continue to get paid billions of dollars so that Google's the default search engine. Morgan Stanley today says it's the best, it's the near best case scenario for Apple and should be a clearing event for that stock. Now maybe we already thought there was a clearing event for the stock which had led it to appreciate to where it is today at 236. So it's up nicely too. Bank of America raises its target to 260. It's a 10 buck boost, they reiterate. Thereby Wedbush's Dan Ives, who's going to be on closing bell with me later, says monster win for Cupertino and for Google. I think most would agree Joe, with those statements.
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D
So Apple exceeded the August 14 high at 235 12. That clears the path now towards 260 which was the December high. The first real clearing event occurred on August 6th. I think there's a similarity between how you think about sentiment and positioning for Apple at that moment to where Alphabet is today. So I think you will see that valuation spread narrow because I do Believe Alphabet will catch up to Apple. I think Apple is going to be more of a staircase, move higher here towards that 260 level. I think Alphabet has the ability to very quickly advance on a rebuilding of position.
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A
We're going to have some tests coming up too that are still to come about the state of the AI trade. You're going to get one tomorrow with Broadcom. So, you know, Nvidia has done essentially nothing since its earnings report. It's, you know, it obviously had the sell off following. But how, how much does this one matter on top of that?
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D
I think it matters significantly. Look, I'm not going to pretend to sit here and know the direction that the stock is going to move after earnings. You're going to have earnings and revenue growth somewhere around 20%. If you knew that, you wouldn't be sitting there, right? Well, there are, there are sometimes, there are some times.
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A
If you knew that, where would you.
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D
There are some times that we go into earnings and we've done that in the past and we've said, look, we feel really good about the potential for this stock to move higher after earnings have moved lower. I think this one's a coin toss. I think that there was going into this a very high expectation rather surrounding what they had to deliver fundamentally. Maybe Nvidia offered a degree of relief with that post earnings sell off last week, but this is a company that when you pull the lens back and you say 30,000ft, how integral are they in the logistical build out of artificial intelligence? They're vital because they are delivering the integrated circuits that allow the chips collaboratively to work together. And that is vital.
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A
What's the PE on Broadcom Forward? We find that out, guys in the control room for us. I mean, when you look at that relative to say an Nvidia which is like 32 and a half times or something like that. So this one's a little richer, right?
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D
It's almost 40, 40, 45 ish is what I'm seeing right now.
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A
Does it deserve that?
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D
I think, I think it does. But it does place it in a valuation level that is higher than certainly it has been for the last 10 years. And two years ago when you spoke about this company, they were a reasonable valuation alternative to names like AMD.
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E
Well, AMD's been priced at a discount in video and Broadcom for a long time, but I've never understood the valuation on this company.
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A
For Broadcom?
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E
Yeah, on Broadcom I think it's excessive. Their growth is good, it's strong. But I'm More of a cash flow investor. And when I look at their EBITDA valuation, which is their cash flow, I get a number that too high now they're growing cash flow about 30, 35%. Their growing earnings at about 40. So you say it's trading at one peg or so and that's reasonable. But it's also a commodity company in a lot of respects. So it's a, it's second to Nvidia in terms of the growth.
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A
But you just buried the lead. It's second to Nvidia in terms of growth.
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E
Right. But it's a much broader business also. It's in a lot more commodity.
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D
VMware.
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E
Right.
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D
There's components of it. Right.
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E
And VMware was not a great public stock for a long time because slower growth. So I'd still rather own Taiwan Semi.
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A
Well, the news with the White House revoking the waiver for it to send the equipment to China, how's that factor into how you think about that stock? Is that news just happening in the last 24 hours? Look.
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E
Tell me what happens in next 24 hours because it could change. So I just don't think that, that you get worked up about that. Market's not worked up about it. Taiwan Semi just got a massive business outside the U.S. the issue that a number of these companies are having and we're involved with one of the largest semi companies is that the money they said they'd spend the US to build plants here, they're now cutting that back because they are going to be taxed on what they sell outside the US So that's got to come. So Trump administration have to come to grips with that. So you may not see that, you know, the waiver, be reasoned, the waiver may be reinstated. You just can't, you just can't bet on what these tweets are and what policies today because it changed tomorrow.
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A
We thought there was an interesting note today from UBS which talks about positioning within tech as it relates not only to antitrust risks fading, but the AI trade in general in which they are urging investors to rebalance tech exposure away from large cap semiconductors and towards AI laggards that have not rallied as sharply. They want you to identify still within the AI theme but names in the defensive software space that got us thinking like is that, is that the cyber trade? Because that's lagged, that's lagged considerably quarter to date. We'll show you what's happened here. Fort nets down 27 and a half percent in the quarter. Crowdstrikes down 20, Zscalers down 16, checkpoints down 14, Octa is down 11 and Palo Alto is down 7. Zscaler gave a pretty good outlook, but you wouldn't know it from the way the stock is reacting today. Let's look at that one. What do we think about this note? Why don't you weigh in on that, Liz? Away from large cap semis, let's say away from the Nvidia's and the Broadcoms and maybe the AMD's and whoever else you consider to be a large cap semi, and into some of these defensive software names that have lagged and lagged significantly over the last few months.
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B
So the last time I was on halftime, I used to Software is my final trade. I don't work for ubs, but I happen to agree a lot with this statement. I think that when you look at the AI trade broadly, software companies are not typically the ones that come to the top of the bubble. Cybersecurity certainly aren't the ones that come to the top of the bubble. So they just haven't been the darlings on this. They've been sort of left behind. But I don't think these companies have done anything wrong.
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A
They haven't really been left. But let me stop you for a second. They haven't really been left left behind. Until the last few months they had the charts. Almost all look the same except for a name or two. They were up and to the right almost unabated. CrowdStrike had its issue and then before you knew it, the stock had regained everything that it had lost. If you look at some of these names, you'll see. So yes, it's been a lately story. They haven't suffered any more lately, but they've trailed.
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B
So when I think about technology as a sector, you split it up into industry groups. I'm constantly comparing software and semiconductors. You look at semiconductors as the cyclical component of that sector. Software, historically and still today, I think does become the more defensive posture of that sector because it's usually more sticky revenue, the contracts are longer, so on and so forth. They don't trade the same. So software, when compared to semiconductors, was left to behind or at least trailed last year, did better than the broader market, but trailed coming into this year. The thesis, my thesis was that this was the time when software could shine. It was time for all of these promises for AI to be put into action. Software was going to be the conduit to actually make that happen. That hasn't really materialized in the way the stocks have traded. So I think that software having been left behind even in the last two months is a good opportunity for investors in the cybersecurity space. Although not a direct AI play, we don't necessarily talk about it that way. I think it's also a good opportunity for investors for a long term period to get a position.
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E
I say the reason for biggest time.
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A
To rebalance away from like large cap semi into some of these names that have gotten hit, hit pretty hard. That's the crux of our conversation.
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E
Not cyber, definitely not cyber. That's because cyber is, it makes Broadcom look like it's being given away. When you get crowdstrike trading at over 100 times earnings, when you've got Zscaler trading at over 75 times earnings and ridiculous multiples on cash flow in the 30s on an EBITDA basis, I don't know how you put new money in there.
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A
That's Joe.
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D
So the six names he owns, like.
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A
The Sixnet crowd check, Fortnite's the cheapest.
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E
Fortnite is cheapest for soldiers. So it's not growing anywhere near the rate the others are.
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D
So I've been observing the 30 day momentum constantly because they are in a correction. Of these six names right now, Palo Alto looks the best in terms of having relative outperformance. They're, they're, they're speaking towards moving into defensive technology. Well tonight you have a company that's reporting Salesforce, which none of us are really coming talking about, we should talk about all the time. Is that an example of maybe something that's defensive software and maybe we should be somewhat excited about what they're going to report this evening.
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C
You got to buy a stock that's on the decline. I mean I look at Salesforce in the same breath as I look at Adobe and I know I've defended it. But I will tell you, and this applies to Salesforce as well, Adobe is going to report I believe next week and if it doesn't respond, I don't care what the report is. If the stock doesn't move up, I think that's the final nail in the coffin as far as these sorts of truly defensive Joe, truly defensive software names trading at mid teens multiples, just giving up on them. I think Steve makes a very good point about the expensiveness of the security names. But the simple fact of the matter is they're expensive because they've been going.
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A
Up and to the Salesforce is down 24% this year. To your point of being a laggard by the way, Marc Benioff, the CEO is going to be on with Jim tonight on Mad Money following the earnings report. So you hear directly from him what he thinks the problem is for why his stock is looks like it does, which has been for the last handful of months a nothing burger after having a pretty good slide to start the year.
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C
Listen, I'll also say this. I like the discussion from UBS because what's only getting a little bit of mention is the fact that semiconductors or the hyperscalers are all spending a ton on capex. I mean real assets that they're spending on. These are real assets that will require maintenance cap expenditures to keep up. It will, it will have depreciation and amortization that hits earnings going forward. Traditionally that has knocked multiples down. So when we're talking about a broadcom at a mid-40s multiple. Steve, I think you make a good point there.
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A
You know, the other part of that UBS note that we thought was interesting today was a blurb that said the following following quote. We think the investment case for China tech driven by model optimization and chip localization remains intact. We don't see these latest measures as a signal. US China tensions are again set to escalate. These are stocks we just frankly haven't talked about much. And over one month Alibaba. Now there was the announcement of the developing their own chip to make up for the lack of Nvidia chips in China. That stocks up 16 and a half percent. Even more than that because this is is updated right to the moment up more than 17% over one month. There's Tencent and Baidu and the K Web. You take that right. Over one month. Weiss used to own some of these names.
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E
Yeah.
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A
Now's the moment. Right. The notion that that China is not going to be a significant player on the global air stage.
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E
Yeah.
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A
Is just flat wrong. And not to mention the fact that US investors who are looking for ways to play AI beyond the mega caps and others are putting capital there quite quite obviously if the stocks are reacting the way they are.
- [24:03]
E
Yeah. Look, Baba is the cheapest. It's the best situated I do despite my aversion to to, to stocks domiciled in China. Companies domiciled in China. I look at it and I've gotten very close to pulling the trigger. I may because it's just so cheap and that the company's got religion. It's no longer just the Jack Ma days. They're looking to maximize shareholder value as well. And they could be a leader in AI for sure, you know, because they've got the balance sheet to do it and that's what it takes, balance sheet.
- [24:38]
D
So I jumped on the David Kepper train in January. I bought, bought Baba. I wrote it higher into April. And I will tell you that I am disappointed that I've gotten out of it now and wish I held it because I do think there is fundamentally the case that could be made for this company to see its valuation, to get the multiple expansion that you're talking about and for it to be able to deliver for shareholders well beyond where it was the 52 week high at 148. So I think you're talking about potentially 150. And of course, you could always text David Tepper and ask him if he's still in.
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E
Well, actually, you know, I did talk about it.
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A
All right.
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E
And he's still there.
- [25:14]
A
Okay. Oh, he's still there. That's your breaking news.
- [25:17]
E
Yeah, but I wouldn't break anything that wasn't public.
- [25:21]
A
Oh, really? It's, it was public that he's still there. Well, look at his cover. You, you know what? Now, Weiss, you already went there.
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E
Look at his filings.
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A
You can deal with the phone call later. News alert from Amon Jabbers. Eamon, what do we know, Scott?
- [25:33]
F
We know that the President of the United States was appearing in the Oval Office a short time ago discussing tariffs and the potential case at the Supreme Court that he's facing now. The President said that if the court doesn't go his way on tariffs and the legitimacy of his legal authority there, he may have to roll back a bunch of the trade agreements that he put together with countries around the world during the course of this year. Here's what the President said in the Oval just a short time ago.
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C
If we didn't have the power, prestige and dignity of tariffs, and I used.
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E
Them wisely and people respect America again.
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A
And we've become a rich country again.
- [26:10]
E
The money coming in is incredible.
- [26:12]
C
And again they use them on us.
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D
If we didn't have them, they would.
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E
Use them on us and we would.
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A
Have no way to fight them.
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C
We would be a third world nation.
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A
So I think it's one of the.
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C
Most important cases, cases I've ever seen.
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D
Go before the supreme court of the.
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F
U.S. now, the President was asked by one reporter in the room, you know, what's your plan B if this tariff ruling doesn't go your way? He didn't answer that question, just laid out his view of the history of tariffs in this country going back to 1850. You mentioned the 1870s, 1913 in the President's view, Scott, a world where tariff revenue makes up the majority of American tax revenue is preferable to a world where we use the income tax to finance the federal government. He's set that out as his vision. Of course, the math on that is tricky to say the least, but the president wants to replace as much of the income tax as he can with tariff revenue.
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A
Scott. Well, I mean, it's a critical part of his agenda quite, quite obviously. I mean, the Treasury Secretary himself suggested amen over the last few days, at least that there is a Plan B. I mean, there has to be. But it's not going to be nearly as powerful as just unilaterally deciding that you're putting on tariffs through an emergency executive order. Right.
- [27:25]
F
And the question is, to what extent would the president by any Supreme Court ruling be forced to rely on other legal authorities, A, which are more convoluted and trickier to impose, or B, to go to Congress, given that Congress controls the power of taxation in this country and get Congress to pass these tariffs? That would be a contentious fight every single time. What the president likes about his vision of tariffs is that it's been a relatively unilateral use of power.
- [27:52]
C
Right.
- [27:52]
F
He can do this, or so he's argued by himself with executive authority. And he doesn't have to go to Congress, doesn't have to wrangle the votes. You see how difficult that is even on the continuing resolution that they're fighting for now to try to keep the government open. That could be a tricky fight every time. That really waters down his power to do this and to negotiate the way he wants to.
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A
Yeah. And of course, yesterday asking the Supreme Court to expedite this proceeding. So maybe we'll get an answer sooner rather than later. Eamon, thanks very much. On the north lawn of the White House as usual, Eamon Javros for us. Up next. After a quick break, calls of the day, an upgrade for one of Joe's energy plays. It's hitting a new high today and a price target bump for one of Jim's big bank winners. Halftime's back right after this.
- [28:37]
B
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- [29:37]
A
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- [31:12]
C
I'm totally in agreement with Mike Mayo, who I've been in sync with for a couple of years on this. The stock now trades just a hair under tangible book value. I'm going to say it again, a hair under tangible book value. Everybody else is at a premium to tangible book value. It may be really big. In JP Morgan's case, around 2.4 times tangible book. It may be smaller in the Case of Bank of America 1.4. But I submit to you there is really no reason that there should be any discount to tangible book value at Citigroup. They have been right sizing the ship for the last four years. It's showing up in the results. Reducing cost costs, increasing return on tangible common equity and that's set to increase into 2026. Plus there's a catalyst coming up in the soon to be spun out Ban AMEX ipo. There is a lot to like here. It's also a discount to forward multiples of earnings. It's got a great dividend yield and I could go on but there's more to come.
- [32:05]
A
Let's even look at a three year. I'm trying to remember how long it's been since you started recommending the stock on this show. As a true believer in what Jane Fraser was attempting to do. I'm glad I asked for that because it feels like it's been in around that time frame. Maybe you've owned it longer, but the stock is a near double over the last three years.
- [32:25]
C
She's been office a little under four years and I've never seen a CEO not get a honeymoon the way Ms. Frazier did not get a honeymoon when she was announced as a CEO. It may have been because of the revolving door. Scott, you know this, the many CEOs who had gone through Citigroup's executive suite without affecting change. At first the market did not believe it. But she's done the right thing. She's hived off those sections of the bank that were not earning their cost of capital. She's lent into those areas that are and that are profitable going forward like investment banking, like wealth management. And again this spin out abandoned X coming in the next, I think six months or so should be expensive catalyst to then move the stock to a higher premium of tangible.
- [33:07]
A
What's interesting is if you look at the 12 month change from a percentage standpoint among the big banks, she's a winner as a CEO leading a, you know, a bank and having the stock perform. Now in fairness to everybody else, 49% for Goldman Sachs, no slouch and 49% Morgan Stanley, no slouch. But feel like Jane Fraser doesn't get talked about as much as some of the others. And she's got a Stock that's up 52.3% over the last 12 months. She has year to date by far the best performing big bank stock in this market.
- [33:49]
C
With more to go. Go ahead.
- [33:50]
E
What I'd say is that people vote with their feet. And what has been, and what has been the stamp of approval on this is if you take a look at who she's been hiring, who's been willing to join Citi, it used to be the place where bankers went to die. Now bankers that are in the prime of their career at other firms, great firms like a Goldman, for example, are moving over there so they know what's going on. They can go under the hood. So that, that's, that's the justification for stock doing is as it has now. I still think it's cheap. This is another one I've looked at buying, just haven't had room in the portfolio. I already own two banks, but Jim's had a phenomenal call on it. And it's, it's one I've missed, but it will keep going.
- [34:34]
A
All right, what are we doing now? Oh, we're getting the news now. There we go. Savannah. Hi.
- [34:43]
B
Hey, Scott. Good afternoon to you. All right. Ukraine says the offer Russian leader Vladimir Putin made earlier today to meet President Volodymyr Zelensky in Moscow is unacceptable. In a post on Ukraine's foreign minister said Putin was making, quote, knowingly unacceptable proposals, adding at least seven countries, including three Gulf states. The Vatican and Switzerland were ready to host the meeting. Iran grew its stockpile of enriched uranium before Israel launched itself military strike in June. Multiple outlets reporting a confidential report from the UN's nuclear watchdog today found the country had more than 70 pounds of uranium enriched up to 60% since the agency's last report in May. That is a step away from weapons grade levels. And while the leaders of Russia, China and North Korea came together for a military parade in Beijing today for the first time in 60 years. The visit also marked the international debut of Kim's daughter, who was seen stepping off a train with her father, Kim Jong Un yesterday. Experts say her appearance is a strong indicator that she may be Kim's successor. Scott, I'll send it back to you.
- [35:55]
A
Okay, Silvana. Thank you, Silvana. And up next, playing the next leg of the rally, our Leslie Picker standing by with your ETF today. Halftime's back right after this.
- [36:07]
D
Will the job market bounce back from the recent weakness? Will the White House challenge the accuracy of the data numbers and analysis of the critical August jobs report squawk box Friday, 8:30am Eastern streaming on CNBC.
- [36:21]
A
Plus, Leslie Picker is today's ETF edge. Hey, Les. Hey, Scott.
- [36:27]
G
Thanks so much. As you've been discussing September, starting with volatility, we're looking at ways to switch spread risk through ETFs. I'm Leslie Picker in for Dominic to. Joining me now is Brian Van Cronkite, Senior Portfolio Portfolio Manager at All Spring Global Investments. Brian, thank you for being here. Let's just go ahead and set the macro stage. You are not convinced the Fed is a lock to cut rates this month?
- [36:53]
H
Yeah, that's correct. The Fed has 90% probabilities that they're going to cut this month and they probably do. That is the base case. But there is reason to be concerned that inflation still is above their desired target. Employment is clearly weakening and a forward looking Fed probably would cut rates here. But a backward looking Fed, a data dependent Fed probably still could lean on the higher inflation rates and say look, we don't have the deflation of the AI trend yet to support our price stability and so we can't go too far. So it's not a lock. But I do think the base case is they cut and then pause from here.
- [37:26]
G
So do you think they should be cutting then given some of those potentially lagging deflationary pressures or do you think that, you know, they should be on hold given all the uncertainty that's out there?
- [37:39]
H
I mean the reality of the investor is what I think they should do is less important than what they're probably going to do. And right now I think they're going to probably cut and as a result as an investor I need to think about what that does for the markets overall. It probably re accelerates some of the investments in areas like housing. It probably creates additional return invested capital through CapEx. And so it's a very offensive signal. And what I think they should do is less relevant to what they actually are going to do, which is probably cut rates.
- [38:06]
G
Yeah, don't fight the Fed as they say. So building on that idea of deflationary pressures, which sectors do you believe will be the biggest beneficiaries of this wider AI buildout now ramping up when the.
- [38:20]
H
Large cap space has been some very clear early winners, a very narrow set of companies which we all know and they probably continue to do okay. But investors probably should begin to look to diversify into other categories of additional or second effect winners. And I see a lot of that happening in the industrials and materials space. If we're going to build out this infrastructure and more companies are going to utilize it, we're going to be able to layer in the near shoring and onshoring effects of of the recent policy movement and that's going to create a capex cycle that benefits the industrial material sector specifically. So we want to begin to move capital from tech into industrials, into materials and let that now be the next leg of our winter trade.
- [39:01]
G
Yeah, about the full supply chain there. Thank you so much, Bryant. We're going to continue the conversation over at ETF edge.cnbc.com, bryant will be joined by Todd Sohn, technical strategist at Strategus Securities. I'll send it back over to you, Scott.
- [39:15]
A
All right, Leslie, thank you. Leslie Picker straight ahead, roughing the passer. The NFL throwing a flag on the service the tracks its viewing audience. We already know it's big, but maybe it's even bigger. We'll break down the money on the line next. Welcome back. The NFL season kicks off tomorrow night on NBC with the super bowl champion Philadelphia Eagles taking on the Dallas Cowboys. And while a huge television audience is expected to tune in, there is a brewing battle between the league and the company that tracks its ratings. Our Julia Boorstin is here with more. Julia?
- [40:04]
G
Hey, Scott. Well, the NFL's chief data and analytics officer, Paul Bailou, criticizing Nielsen, telling the Wall Street Journal there are millions of viewers that we believe they are saying systematically and undercounting. Also saying that the NFL is experimenting with measurement alternatives. Now, undercounting would have a meaningful impact on the NFL's ad revenue and also the value of its rights spread across streamers and broadcasters. The NFL does have a window to renegotiate its deals after the 2029 season and it could open its negotiations with CBS sooner. Nielsen responding that it is working closely with the league to innovate around how it collects data and that it's, quote, confident that this will be the most accurately rated football season in history. Now, Nielsen recently launched a new measurement tool that draws data from 45 million homes, cable boxes and smart TVs. Nielsen telling me that they are in active talks with broadcasters about getting more first party data in addition to the new data that they are collecting.
- [41:02]
A
Scott, where does if you know the answer, maybe this is a dumb question. And if it is, I apologize. NFL Sunday ticket. I mean, how does that factor into this conversation? Do they they track the ratings for that if it's streamed, how do we.
- [41:18]
G
Know that that's a different situation because that's a separate subscription, a separate package of Games which YouTube has the rights to sell. And so that is a different equation here. I think what's most in focus right now are the streaming of the new games, games on Netflix. They have the Christmas Day games. And then of course you have YouTube which has, excuse me, not YouTube. Amazon has the Thursday night games. YouTube has the Sunday ticket games. And YouTube actually has an opening week game which we're going to be seeing this week, which is going to be streaming around the world. And then of course you have the broadcasters, but people are now watching broadcast tv, if you will, on so many different platforms. They might be streaming it on YouTube with live TV or Hulu Hulu with live TV as opposed to watching it via a typical broadcast signal. So I think there's so many different ways people are consuming content. And the NFL wants to make sure that its rights are accurately valued. And the way to know that is to have really specific data about how much people are really tuning into their games on all these platforms.
- [42:24]
A
It's always about the money. Julia, thank you very much. That's Julia of Boorstin. Interesting story. I'm glad you brought it to us. By the way, do not miss the reveal of CNBC's official 2025 NFL team valuations. It starts tomorrow on Squawk Box. And be sure to catch Michael Ozanian's interview with Cowboys owner and general manager Jerry Jones. That's coming up on closing bell overtime. And how timely is that given the news of the last couple of weeks with the departure departure of best defensive player in the league, Micah Parsons, where.
- [43:00]
B
Did he depart to?
- [43:02]
A
Your Packers. Yes.
- [43:05]
B
Just want to make sure that's in there.
- [43:06]
A
All right. I'm glad you added that, too. Up next, Santoli with his midday work. Mike Santoli, our senior markets commentator is with us. Your thoughts on the market today, which is obviously an Alphabet dominated narrative.
- [43:38]
D
Yes, for sure. Alphabet and Apple holding up the S and P and the Nasdaq light pressure on the rest of the market on balance in particular semis. They've actually been kind of sloppy for another day. But though Broadcom was up, I also think you have to note the pronounced reaction in the bond market to that jolts data, even though it wasn't that far from forecast. Just that additional softening up of the the labor market supply demand setup did have yields backing off, kind of cooling off from where they were yesterday. And maybe it means the market is now in the process of just tightening up ahead of the official jobs report on Friday. We want to see stay in this line of pricing in September cuts, but not having to worry that there's another growth scare underway. So I think we're walking that line for now and see if we can continue.
- [44:24]
A
I mean, we're walking towards rate cuts if Waller has anything to do with it, as he's already expressed, and he did again with Leaseman. And now that just really ups the ante, I think, for this Friday's jobs report. Mike, don't you think?
- [44:36]
D
It does. And it really is hard to envision exactly how, how out of bounds to the upside a jobs print would have to be to pull the market off of the September cut, you know, expectation, whether that means it does reduce the cadence after September or who knows? You know, look, things can change in a short period of time. We've seen that repeatedly when it comes to Fed expectations. But right now it feels as if the bar is pretty high for really steering away from a September quarter point cut, given what we've seen with inflation, the way the markets price things at this point.
- [45:09]
A
I'll see you on closing bell. Michael, thank you. Mike Santoli, finals. We'll do him next. All right, three o', clock, closing bell. Dan Ives will join us. What this really means for Alphabet and Alphabet investors moving forward. Apple to Lauren Goodwin, Courtney Garcia, Torsten Slope from Apollo Abioder and I will see you then on closing bell. Farmer Jim so much love was flying around this set today for Farmer Jim.
- [45:41]
D
Yeah, I'll get used to it.
- [45:43]
E
Long overdue.
- [45:44]
C
I'm not going to hang on to it, but AstraZeneca is my save it, savor it. Yep.
- [45:50]
A
Because it could be fleeting.
- [45:52]
C
I'll see you on Friday, Scott. We'll see if it lasts.
- [45:55]
E
AstraZeneca Cleveland Cliff, what do you got? Only kidding. Not Cleveland Cliffs.
- [46:01]
A
I bet the stocks bounced off from the Smithsonian.
- [46:05]
E
This is style again. Again. Style change that.
- [46:09]
A
Exhibits over the guy who got it out.
- [46:12]
E
Bitcoins bounced off the lows. I think the upward trends resume.
- [46:15]
A
Liz Thomas High Div. Low Vol.
- [46:18]
B
The yield on this one is 4.6% better than treasuries.
- [46:21]
D
Corning.
- [46:22]
A
All right, closing bell. I'll see you then. You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern only on CNBC.
- [46:36]
B
All opinions expressed by the Halftime Report 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 Halftime Report 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 Halftime Report disclaimer, please visit cnbc.com halftime reportdisclaimer Football season is back.
- [47:18]
C
Sports business expert Mike Ozanian breaks down the latest numbers.
- [47:22]
D
The biggest and most profitable sports league in the world. Exclusive NFL team valuations, September 4th CNBC.