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Intel's Surge, Vaccine Recommendations and Kimmel's Indefinite Suspension 9/18/25
00:43:57
Intel shares climb after Nvidia announces a $5B investment. Positive trial results raise Novo Nordisk shares. Plus, inside ABC's suspension of "Jimmy Kimmel Live!".
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You're listening to the Exchange. Here's today's show.
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Thanks Scott. Welcome to the Exchange. I'm Melissa Lee along with Mike Santoli. Stocks at record highs following the start of the Fed's rate cut cycle. Tech leading the gains there semis in particular intel and Nvidia. The reasons why of course Nvidia announcing a $5 billion investment in intel that's putting intel shares on track for its best day since 1987. A webcast with both CEOs getting underway right now. We will bring you the biggest headline.
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And noteworthy that yields are also higher today with the 10 year climbing back above 4.1%. Obviously made a low below 4% yesterday. So we are now just a little bit below that fractionally. Really kind of interesting because there was a little bit of a, of a mini consensus developing that if we get the expected 25 basis point rate cut there might be a sell. The news response we got it in bonds, right? It was sort of like well bonds kind of priced for the, for the scenario in general. The stock market is trying to execute the typical Fed easing rotation. It's mostly what it is. Small caps are up 2.1% three times with the S and P. So I actually would expect the S and P and the Nasdaq would not even be up as much. If not for the Nvidia intel news, you might see a more true rotation. So so far building on the highs but it's, it's interesting. I'm not sure everyone is fully comfortable with it because we did already run A little bit and take a look a listen to what David Tepper, joined us on Squawk Box this morning, had to say about his good performance but his discomfort with it. I'm not like, you know, there was a phrase I used, you know, about, I guess it was, you said it was a term used in the Navy, balls to the walls. Look, I'm constructed because of the easing right now, but I'm also miserable because of the levels. Does that make sense? Miserable because of the level.
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I think it's the perfect soundbite because it really encapsulates what so many market players are feeling right now and that is valuations are high at this point. But you can't fight the Fed, right? So what do you do? You're a reluctant long and there plenty of them out there right now, 100%.
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And as you get into the fourth quarter, maybe that manifests more in chasing. But also not just that, oh, you can't fight the Fed, you can't fight the rising tide. But he sort of conveyed that he doesn't even really feel like there's an edge out there. You know, he's nice to kind of zagging when people are zigging. And right now it's just kind of you're going with the flow of what everyone is already kind of knows are the big.
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Yeah. And I would imagine he said he's miserable in part because intellectually you see the data and it is. There is some doubt in terms of the health of the economy.
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Yes, there's a lot of crosscurrents and he did say a couple more rate cuts might be fine. More than that, it starts to get a little dicey. Whether you overheat the stock market or inflation kicks back up again.
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E
All right, let's get straight into the big story of the day. Shares of intel rocketing after Nvidia announced a $5 billion stake in the struggling chip maker. This just weeks after the U.S. government took a 10% stake. Christina, parts Nebulous has got more in today's tech check. Hey, Christina.
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Hi, Melissa. Well, intel, like you said, is up big because the most valuable AI company just wrote them a 5 billion dollar check. The deal has two parts. Intel builds custom CPU central processing units for Nvidia's data center platforms. And then intel also creates chips, combining their processors with Nvidia's graphics specifically for personal computers.
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PC.
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Notice what's not mentioned. Intel's foundry business. Zero manufacturing commitments in the press release thus far. The 5 billion dollar investment is a lot, not chump. Change, but only roughly 1% of Nvidia's projected $500 billion in free cash flow over the next four to five years. So I could say maybe pocket change for Jensen Huang, but massive, massive validation for intel, which desperately needs an AI story. The White House angle that wasn't is kind of telling. No Trump mentioned in the press release. No government officials quoted this morning. National Economic Counselor Director Kevin Hassett told CNBC he wasn't aware of the government encouraging this investment. Recall that the administration $10 billion in Intel a month ago at $20.40 a share. So already a 50% upside. AMD, though, let's talk about the laterals. AMD is down roughly what, 3%, 2.5% right now because this really threatens their server CPU games. Then you have ARM down even more because it undermines their Nvidia partnership specifically to CPUs. And investors are buying up semiconductor equipment stocks across the board. But they might be getting ahead of themselves because we have zero details on volume, production timelines and whether intel can actually execute on any of this and.
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How long it'll take.
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The best player, though, in AI just lifted the most out of favor. Semiconductor stock announcements, though, are easy, but execution is hard, especially for Intel. Nvidia doesn't write $5 billion checks lightly, but intel still has to deliver.
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Christina. You know, analysts have been bullish on, on Nvidia for so long. There was never a mention that Nvidia needed this sort of partnership or was missing this part of its business. And I'm wondering why all of a sudden it is seen that Nvidia needed this and this is actually beneficial to the business model.
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So two fronts. So we're talking this is a product deal. And the interesting part is the personal computer side. Intel has about 70% of PCs and they make the, the CPUs for said PCs. The fact that Nvidia is partnering with them would give them a stronghold into the PC market and also in the turn allow intel to expand that and include AI. So AI, PC. So this is more of like a four, four year time frame for something like that. The second is not proven. It has to do with politics. Right. You have Nvidia caught in the middle between the dynamics between China and the United States. They're often used as literally a bargaining chip. And so if Nvidia shows that they're investing on US Soil in an all American company that is, you know, manufacturing here in the United States, and that's seen as a win in President Trump's eyes, and then potentially that could be used as leverage and really help Nvidia in their dynamics with China. So that's probably more the route, but they're not going to comment on that.
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And is it, does it move the needle, Christina, for Nvidia, in terms of really diversifying their production partners, obviously Taiwan semi. Is the core of that, that business there or is it just as you suggest, kind of going tangential or additional to what their, their actual core business is and enlarging the market?
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The goal is that eventually they could shift some of their production to intel here in the United States. But to your point, TSMC is the one that is providing the most advanced manufacturing processes and most of this production will happen with tsmc. The advanced packaging may happen with intel. That's when you get a little bit more complicated. But it's, it's possibly a, I guess a big vote of confidence in the near term that perhaps maybe intel could be the next big foundry for Nvidia, but we're not there yet.
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Christina. Thanks Christina. Parts nebulous. Let's delve deeper into today's moves into chips. Deepwater Asset Management managing partner Gene Munster is with us along with Wedbush chips analyst Matt Bryson.
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Gene.
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Matt, great to see you both. Gene, I'll kick it off with you. Why do you think intel is up so much? I mean what is, what is a statement that you would make about, about this move? Is it that intel wasn't as bad as thought? I mean Nvidia would surely not throw money into failing company.
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I think it's up because it's a validation. Christina talked about it. This is a massive validation. If you look at just the fundamentals, the impact of the business, it probably adds should be up like 5%, maybe 10% today. But this is like an order of a couple of standard deviations. Outside of that. I do want to remind people that when Oracle ripped It was up 40%. It's traded off about 13% from that peak. And so I suspect that we're going to get a trade off. I do believe also that intel is almost becoming almost this meme stock and as was Christina kind of talked about the impact and what's driving this and what was really below the surface. I think the substance of this is this was an endorsement by Nvidia to support a decision from the White House. I think that that's the substance of it and the stock is reacting to, to that and I think that kind of plays into this a little bit of a meme stock that is pretty negative. What I'm Seeing right there relative to intel and I do expect it to trade off I do want to highlight that I'm still very positive on where AI is going to go. I think it will exceed high expectations. So I'm, I'm very much bullish on AI but I think this in particular is just kind of an entertaining birth of a meme stock.
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Matt, where, where do you stand on AMD's move lower? I mean is it true that this partnership could actually threaten amd?
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Does it threaten them make intel more competitive? So over over the longer term possibly. So AMD has been killing intel on share in both PCs and servers over the last couple of years. This maybe makes it a bit harder for AMD to continue to gain share but I mean having said that chip Design cycles are 18 months so everything we're getting out of this is prob. Probably 2027 and beyond in the near term I think there's substantial buying for all components in part to support AI. And both companies look like they're in a better position than they were a month ago given the pickup in demand from these, these large hyperscalers.
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Matt, between last week's Oracle guidance and this news today a lot of the just the supply chain is flying. So you have another 6 or 7% in micron today it's up like 40% this month. Rambus, some other names that have been noted as potentially beneficiaries of this new spending flow. Is it actually substantiated by what we really can expect to come through for these companies?
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I think it's, it's gotten to be over the last two, three weeks so I've had a lot of conversations with the supply chain. It sounds like all those big buyers have come back to the memory companies, come back to the hard drive companies even heard about better demand for computer and it's to source components presumably to fill out these data centers. So yeah demand has gotten significantly better in the last month.
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Jean, does this tie up make you any more bullish on Nvidia? Does it move the needle?
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I think it does. I think the needle moving for Nvidia comes still comes down to the bread and butter. It's the eight biggest companies, they account for just over 60% of revenue and if you want to follow where things are going to go here just or move forward to the middle late October when we're getting the September guidance there's three things to watch. It is the guidance from the Capex guidance from Microsoft, Google and Amazon. Last quarter they suggested that their 2026 capex would be up on average 7%. Meta said it would be up 47%. And so when I think about Nvidia and what does it mean and all this, the announcement today means little given the majority of their business is still with these hyperscalers. And if investors want to get a sense about what's going to happen with Nvidia, just look at those guidance. If they raise it to 20% and video is going to be beating numbers, this is going to go on for longer than what investors are currently factoring in.
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And if that's the case, Gene, I mean, you obviously have had some positive news flow around in Video. The stock itself, after getting repriced following earnings, has been kind of flattish. It feels like investors want to grab for, you know, the next unexploited name that maybe has a little more leverage to incremental revenues there. So is that just a phase we're going through? Is that something where it feels like Nvidia is so large already that it's tough to, to actually, you know, excite investors?
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I think the excitement is going to come back and I understand the second derivative, if growth slows, what that means for the multiple. But ultimately the street is looking for a call at 30% growth for Nvidia next year. Maybe the whisper is slightly above that, but I think they can grow closer to 40%. And there's clearly a lot of places where you can create wealth on the whole supply chain and AI. But I still think Nvidia is going to be an iron horse.
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At what point, Matt, do you think we have to worry, to worry about some of the hyperscalers making their own chips? And we know that that's going on right now and that's sort of been in the background. But in terms of being a threat to Nvidia, what I noticed today in a JP Morgan initiation of anthropic was that their basic thrust was price competition is going to heat up amongst all these products and what they might have to do is to switch from Nvidia to Amazon's training because the price for performance is superior and that will enable them to compete better on price. Is that just, you know, is that, is that moment here where we should be worried?
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I don't think that moment's here yet. So when you think about custom Asics, what custom basics are used is if you understand exactly what the problem is that you're trying to solve, you take that software and you put in hard work that that's really efficient. But you look at General A.I. right, right. We're at the very beginning. And so you want something that's more flexible. A GPU is a whole lot more flexible than a custom asic. So will the custom ASIC guys do well? Yes. But will they displace Nvidia? I don't think so. And particularly not in 2026, 2027. When you think about all this additional sovereign investment that's coming in, those are companies that won't have custom Asics. They will be buying predominantly Nvidia. And I think that will support Nvidia beyond what the CSPs invest.
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And Matt, just to circle back to Micron in particular, I think we have to get the chart up here because it actually really has gone vertical. I realize this is a boom bust story. The earnings just completely rip when pricing and volumes are in their favor. But at what point do you hesitate and say, you know, maybe we're, we're taking too much credit in advance for what's going to come through?
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H
You're absolutely right. That's what happens. That when supply is short of demand, pricing rips, margins rip. We haven't seen a real boom cycle for the memory stocks since 2018. At that point you got Micron with 60% total gross margin, 70% DRAM gross margins. Right now, given the uptick in demand, I think best guess is that's kind of where we're heading. And so I think Micron still has some ways to go.
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All right, Gene, Matt, thank you.
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Thank you.
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We've got a news alert here on Google. We want to get to Mackenzie Seagalas. Scott, that story Mac.
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Hey, Mel.
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So Google is giving its Chrome browser a major upgrade. The search giant is rolling out its Gemini assistant to all Chrome users in the US on Mac, Windows and mobile devices. Now, by baking Gemini directly into the browser, it will help users work seamlessly across tabs and apps, meaning that you can access YouTube, maps and your calendar without leaving the page that you're on. And then crucially, in the coming months, they say that they'll also be introducing agentic capabilities. So that means that all users will have the option to outsource to an agent tasks like scheduling a meeting or ordering groceries.
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And it's going to be available to.
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Businesses in the coming weeks via Google Workspace. With enterprise grade data protections now, browsers have really become the front line in the battle for AI dominance. Startups like OpenAI and Perplexity are chipping away at Google's long held search monopoly. And with that DOJ overhang out of the way, this latest move makes clear that Google's intent to keep Chrome and its search business at the center of how billions of people access the Internet is really a key priority for them guys.
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Yeah, I guess they had to have had this plan in reserve. Just waiting to get clearance to hang on to that, that browser. Mackenzie, thank you very much. Coming up, stocks hitting all time highs with the Russell 2000 Small Cap Index on track for their first record close in four years. Wells Fargo is raising their year end targets for this year. And next, on the back of the Fed's rate cut, we'll speak to the CIO behind that call.
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But first, the latest in the weight loss war. Shares of Novo Nordisk up 6% today on positive results from its once a day oral obesity pill. We've at the latest. That's next.
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This is the exchange on CNBC.
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E
Welcome back to the Exchange. Novo Nordisk shares popping 6% after better than expected trial results from its so called wegovy pill. Angelica Peebles is here with more. So much coming out this week in the weight loss space.
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It has been quite a busy week, I can assure you that. But this data definitely impressing. So this was actually not presented at that conference, but still coming amid this big week where we have all of these different presentations coming out of this diabetes conference in Vienna. But the headline here is that wegovian, a pill, as Novo is now calling it, it produced weight loss of more than 16% at the highest dose. That's a 25 milligram dose. And that is important because, remember, the expectations for Lilly's pill have come down so much that their health showing about 12% weight loss. And now you have Novo out here saying, look, our pill is just as good as our weekly shot. And so now we have a viable competitor here. And I think it's part of this narrative that people are now giving Novo a second look in the obesity pill space. For so long, people thought that Lilly would just naturally dominate because they have a drug that you can scale easier. There are no food and water restrictions. So clearly they were going to be the winner here. But now people are rethinking that and saying maybe Novo actually does have a good shot.
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But we don't really know what patients uptake will be in terms of conforming to the requirements that you have to take the pill within a certain amount of time of eating, et cetera. I mean, it's much more restrictive than.
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Or, you know, I think that's a really interesting debate. So it's. You can't have. You can't drink water, eat any food for 30 minutes. Now, some people will say that's a really big restriction. Other people will say, how big of a deal is that? You know, you take it before you get in the shower and. And you go about your business and then you suddenly eat like I eat when I get to work, you know, so that wouldn't really be a problem for me. But so that I think is something that people will consider. I'm sure that Lily will make a very strong point to say, look, ours doesn't come with any restrictions. But again, you can already see this change in posture from Novo that they're putting in their press Release. This is WeGovy in a pill. And that's something that I'm sure you're going to hear them hype up quite.
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A bit with all the iterations of these treatments. It's kind of fascinating. It's kind of like software versions, right? There's always going to be a tweak. They can improve it in one, you know, at least for one application. So how durable are these advantages that, you know, any of these companies comes up with?
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Well, the pill is obviously an advantage because it comes, you know, it's a pill versus a weekly shot. Now, how big of an advantage, again, is something that has been debated. I think going into this year. People thought if you could come up with a of piece pill for obesity, that is going to be the golden ticket. And now people are thinking, okay, well, actually people are fine with these weekly injections. However, that's here in the US and the case globally is that not everywhere can support the cold chain that's required to ship these medicines that need to stay refrigerated. And also not everyone can pay for them. So the pill especially, and that's the case for Lilly, is that their pill can be manufactured so much cheaper, so much cheaper than the injections that maybe that gives them a leg up. But still, you know, these are just the first iterations and there's much more to come in the pipeline.
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Another very big pharma story. Recommendations for vaccines against Covid and other viruses on the ballot this week at the Advisory Committee on Immunization Practices now meeting in Atlanta. So I assume a lot of suspense around this.
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Yeah, it's been already a pretty spicy morning, if I would say that that's how I would characterize it. You've seen back and forth. So there's a couple votes today. One, those are both on the recommendations for children for hepatitis B and also a combination shot that combines measles, mumps, rubella and varicella. And so those are the votes today. And then also tomorrow we see the recommendations around Covid vaccines. So you have this very, very public meeting at a time when there's so much controversy. And even right off the top, the chairman of this committee basically, you know, diving into the controversy, saying that this is a public forum. You know, people are criticizing us as anti vaccine. When we're out here, we're doing the work. There was a back and forth just now about, you know, do we need to make a recommendation right now? Why do we have to do this? And so, you know, there's definitely some heated, heated conversations happening already.
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Is there less participation amongst the vaccine makers? I understand in the past they might have been asked to present their side of it when votes such as these come up, but that this time around, they aren't really being included.
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Yeah, we haven't heard from anyone. So this morning, the MMRV vaccine discussion on the agenda, it said manufacturers, but we didn't hear from Merck. They're the only company that manufactures mmrv. So that is a change. And, you know, we are seeing this pullback from the medical communities. For example, the American Academy of Pediatrics, they're boycotting these meetings and they're saying that this is no longer an independent committee and therefore they are not going to participate because this is now a political group. And then, you know, you do have some committee members saying like, that's a mistake. They should be here and we should have an open debate. So again, you know, it just speaks to all of this controversy right now.
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Angelica, thank you. Angelica Peebles.
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All right, coming up, crypto notching a win with the passage of the Genius Act. But the banks fighting back on one key provision. Those details and the big lobbying bucks being spent on both sides. And speaking of crypto, Mizuho upping its price target on Coinbase by more than $30 to 300 dol hundred, saying coin deserves credit for growth, cost management and secular tailwinds. Shares are up 8%.
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And, and we do want to mention the webcast. With Nvidia and Intel CEOs underway. We are monitoring. That will bring you all the headlines as they come up. The exchange will be right back.
- [24:41]
D
I'm no tech genius, but I knew if I wanted my business to crush it, I needed a website. Now, thankfully, Bluehost made it easy. I customized, optimized and monetized everything exact exactly how I wanted with AI in minutes, my site was up. I couldn't believe it. The search engine tools even helped me get more site visitors. Whatever your passion project is, you can set it up with Bluehost with their 30 day money back guarantee. What have you got to lose? Head to bluehost.com to start now.
- [25:11]
B
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- [25:28]
A
Want to take a snapshot of the field position for the NASDAQ right now? Obviously it's been extremely strong. This is showing from bespoke that the index is showing itself to be overbought for something like 93% of all days over the last four months. That's not unprecedented, but it's pretty rare. And this overbought is just a straight statistical reading of how far the index is above its 50 day moving average. So obviously it can't last forever. It's a good news, bad news thing. It shows you the underlying trend is very strong. Overbought does not mean we're about to crash. What it means is you often you have to cool off and give back some. Now there's also been some talk JP Morgan this morning saying, look, if this current cycle goes anywhere near matching the late 90s as some people are saying, and get equity exposures by global investors up to where it was back then. Maybe there's a lot more upside to things like the Nasdaq 100. Well, here's the Nasdaq 100 and how far it is stretched above its own 200 day moving average. A longer term trend, we're about 14% over now. If you go back to 2000 when Nasdaq tripled in about 18 months, you got to almost 60%, like 55% above its 200 day average. That led to a massive multi year crash. It seems as if 20 or so is a ceiling in more normal time. So we still have some room to that level. But any way you slice it, obviously the market's had a pretty good run and it shouldn't surprise anybody if there's a little bit of a sideways phase or some pullbacks down the road. Now to Courtney Reagan for a CNBC news update. Courtney?
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Hi, Mike. Syria's foreign minister is in Washington today making the first official visit by an official from that country in more than 25 years. Lawmakers tell Axios Foreign Minister Assad Al Shabani is needing them to lift the last of the US Sanctions against Syria. Earlier this year, Al Shabani was in Washington, but only to attend meetings at the World bank and the International Monetary Fund. Well, the Supreme Court will hear arguments in a case that challenges President Trump's global tariffs. On November 5th, the justices will decide whether the administration can unilaterally impose tariffs after a lower court ruled the president overstepped his powers to do so under a federal law that was intended for emergencies. And your next Uber Eats delivery could be coming by drone. Uber said it's partnering up with the drone company flytrex to start deliveries and test markets by the end of the year. Uber didn't say where those test markets would be, but flytrex already operates in Texas and North Carolina and makes deliveries for Uber's competitor, DoorDash. Melissa, Mike, back over to you.
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Thank you, Court. Courtney Reagan, mortgage rates meantime on the move after yesterday's rate cut. Let's get straight to Diana. Oh, look for the latest. Diana.
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B
Well, Melissa, as we discussed on Tuesday, before the Fed cut, mortgage rates could go up. And they did. They went up 15 basis points this morning, adding to 9 basis points that they rose yesterday, making 24 basis points specifically since the Fed cut its rate. And that all according to Mortgage News Daily. Now that's because, you know, as many experts weighed in, they expected that people were kind of buying into the expectation and then would sell on the news in the bond market. And that's what you did. You see that the itb, the Homebuilding ETF is still in the positive for today, but actually still in the positive today, but has been down throughout the week as this expectation that mortgage rates would jump up. Not good news for the homebuilders going forward as the hope had been that rates would come down further. The question is will they continue to rise or settle off? On Tuesday, as you know, we were at a 3 year low on the 30 year fixed. Back to you guys.
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Diana. Thanks Diana. Oh look, coming up, strategists are recalibrating their year end price targets including Wells Fargo. We'll talk to the man behind the move about how he is positioning for a lower rate environment. That is next.
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All the major averages at record highs including the Russell 2000 small caps on track for seven week or seven week win streak. That would be the longest in five years. And by the way, the prior record high for the Russell 2000 was in late 2021. So it's been bumping up against the ceiling a handful of times since then. See if this one holds. Strategists meanwhile rejiggering their year end S and P targets amid those new record highs and the Fed easing cycle that is now begun. Our next guest is no exception, raising his year end target to between 66 and 6,800. Also saying though he expects volatility to increase some. Joining us now is Daryl Cronk, Chief Investment officer for wealth and Investment Management at Wells Fargo. Darrell, good to see you. Obviously the market, it kind of got what it both expected and was hoping for. Right. So you have the Fed tilted lower in rates at a time when in general the economy is hanging in there. How much is left to capitalize on that dynamic?
- [30:18]
C
Well, actually you raise a good point I think a little bit this year, to be honest, Mike. But we think 2026 probably sets up to be an even better year for all the reasons that you know, you now have kind of the fiscal plane landed if you will, with the one big beautiful law. No longer Bill. Right. So fiscal is kind of solved if monetary policy continues down this path. Right. Corporate balance sheets are in a incredibly strong position. I mean just look at the post Fed. I mean three things I looked at this morning, Mike. High yield spreads are at fresh lows this morning. There's only been a couple of times in history where the Fed has cut interest rates and yet banks are at their all time high. Usually banks would Be sniffing out, you know, through lower credit quality or delinquencies, defaults. If something like that were happening. If the Fed has to cut interest rates and a cutting cycle, that's not happening. And even this morning equal weighted tech actually finally set a new all time high coming off of when it tried to do it in the summer of 2024. So the markets are telling you, hey, things are a go for the remainder of this year and into next year on more of this bull.
- [31:25]
A
What parts of the market then do you think are better positioned here? I know that we were just talking about small caps. It feels like you are not quite in the camp that says that that's the, that's the preferred vehicle.
- [31:39]
C
No, we're not. I mean small caps, you know, there's two regimes. Small cap should do well, right? If you think about it historically, one is coming out of a recession as the early leader of the cycle recovery. And two is when you get a steep, you know, or aggressive Fed cutting cycle. And the latter is what we're getting right now. So it doesn't surprise us that you see near term outperformance of smalls. But when you actually get into the Russell 2000, I mean today it's a $3 trillion market cap indices against a $67 trillion US stock market cap. You know, even if you compare that to tech, which is now $28 trillion, this whole idea that you're going to rotate from tech to small cap or something like that is to us a little bit nonsensical. And what's more important is the quality degradation that's happened in the small cap universe. Private capital has come in there and cherry picked a lot of the good companies and taken them back private. You've got almost sitting on top of record non earners in the small cap. So we would fade kind of some of the recent strength here. In fact, we just went to an unfavorable or underweight small caps here about a month or so ago and we think that's still the right trade to hold.
- [32:45]
E
You sound rather bullish, Darrell, about the S&P 500. But looking globally, I mean, because you are anticipating further weakness in the dollar. What kind of allocation do you have for international emerging markets in particular?
- [33:00]
C
So we would still like developed markets over emerging at this point even though emerging is done a little bit better. Melissa, we just think, we think the dollar probably stabilizes here. You don't see a lot more. You know, there's a lot on the street calling for a 10% yet decline in the dollar. I just don't see that unless you get some, you know, exogenous element that drives it. In fact, we think the yield curve continues to steepen and the dollar stabilizes here as long as the Fed can't get to its 2% inflation target and inflation trends around 3%. And yet they're still on a dovish path. That's probably dollar neutral and yield curve steepening to us.
- [33:37]
A
Yeah, obviously a little bit of steepening there with the long end leaking higher today. We'll see how far that goes. Darrell Cronk from Wells Fargo, thanks very much.
- [33:46]
E
Thanks.
- [33:47]
A
And don't miss an exclusive interview with Federal Reserve Governor Steven Myron tomorrow morning on Money Movers. That is at 11:00am Eastern time.
- [33:55]
E
Still ahead, Disney's ABC suspending late night host Jimmy Kimmel indefinitely following public pressure from the FCC and ABC affiliates. The details, who could be next and the potential impacts on key media mergers coming up. And a quick programming note, we do have a special Fast Money LIVE Trading the Holidays event happening at the NASDAQ on December 11th. Mark your calendars and scan the QR code on your screen. Head to CNBC events.com/fast money to get your tickets.
- [34:35]
A
We're getting headlines from the webcast between the CEOs of Nvidia and Intel. Let's get back to Christina Parts and Elvis for the headlines. Christina.
- [34:42]
B
Mike, the call just ended with the press right now, three main points that I'm seeing. So the first one was they said that they were working on this partnership very quietly. There was no collaboration with the White House, President Trump. They were just really announced it to them very, very recently. I know there was concerns given that the White House did invest in intel about a month ago. So according to both leaders, the White House had nothing to do with this deal. The second part is that, yes, this collaboration is more about products, products specifically within data centers and PCs and not about Intel's foundry business. Lip Bhutan, the CEO of intel, did say that TSMC is a great partner and we're going to continue to use tsmc. So you can see that that relationship isn't changing. TSMC is still the largest contract manufacturer as a chip manufacturer in the world. The third point is arm. I was able to ask a question to Jensen Huang just about ARM, because Nvidia and ARM work together on CPUs. But now Nvidia is going to be working with Intel. So you saw ARM shares sell off, Jensen Huang said, and I quote, arm shouldn't be down. And yet the share price, I thought it would have went up a little bit more, but it's still down about 4%. The CEO of Nvidia continued to explain the relationship with ARM and how products are going to be used in robots, etc. So that's not according to him changing and then the last point, Jensen Huang did talk about how this partnership is really going to help intel, especially in the personal computer space, not only with the central processing units but the graphics that are needed when we hit all of those pieces that are going to be coming to market and everybody's just going to want more advanced compute on their devices. Guys.
- [36:15]
E
There are comments also by Liputan, Christina, about Intel Foundry, about continued progress. Can you elaborate on that?
- [36:22]
B
Yeah. He was asked specifically more about 14A. So this is an advanced manufacturing process and why Nvidia products are going to be made on that. He was quite frank saying that they're still working through. I don't have the verbatim in terms of what he said specifically, but he was just alluding to they're still working on the yields, they're improving, but that these products are still going to be made by tsmc. The packaging may happen at intel, but the actual manufacturing will happen at tsmc. So there's still some work to be done on the more advanced manufacturing processes on intel side.
- [36:53]
E
All right, Christina, thanks Christina. Parts nebulous. Another late night host in the hot seat for comments about the Trump administration and the gop. Julia Borson joins us now with that story. Julia?
- [37:04]
J
Well Melissa, source close to the situation tells me that Disney CEO Bob Iger and Disney's co chair of entertainment Dana Walden made the decision to indefinitely preempt Jimmy Kimmel Live and Walden made the phone call to Kimmel While the show's YouTube viewership is the highest among late night shows and Jimmy Kimmel Live is profitable. FCC chair Brendan Carr characterizing Desire Disney's move as a business decision related to ABC's broadcast licenses.
- [37:35]
A
Think about the business side of this.
- [37:36]
C
Yet the national programmers Disney that create this content and you've got individualized licensed TV stations all across the country and they're required, they've been for years, required to respond to the needs of their local communities and viewers. I think it was those local communities and viewers that were saying, you know.
- [37:53]
A
We don't like this stuff anymore.
- [37:57]
J
When nexstar, which owns several local ABC stations, said it would preempt Jimmy Kimmel Live on its stations. After Carr spoke out about Kimmel and his comments, ABC then decide to pull the plug on Kimmel's show temporarily. Of course, we don't know what the final decision will be. Now of note is the potential merger of local station owners Tegna and nexstar. That merger is awaiting regulatory approval from cars. FA fcc. Now the question is what is the future of late night television? President Trump taking aim at not just Kimmel but also Jimmy Fallon and Seth Meyers urging NBC in a social media post last night to pull them off the air next. Melissa?
- [38:39]
E
Julie, you've been covering this space for a very long time. This seems like a different environment now. I mean, for the FCC to step in for the White House to come continue to make comments, basically browbeating media companies into policing and sort of wrangling their stars. I mean, this is a very different environment.
- [39:01]
J
Yeah, this is a very different environment. Jim Cramer asked this morning of Commissioner Carr whether he thought there should be someone in the writers room, you know, sort of highlighting this question of who's making the decisions here. And I do think it's worth noting that Disney has not made a final decision decision according to sources close to the situation of what the future of Jimmy Kimmel will will hold. Jimmy Kimmel Live will be, but certainly a different environment here in terms of that scrutiny and oversight from the administration.
- [39:32]
E
Julia, thanks, Julie Boorstin. And tune in to fast money at 5 o' clock Eastern. Media mogul Tom Rogers will weigh in on Jimmy Kimmel's suspension and the potential ripple effects across the late night landscape. So you won't want to miss that.
- [39:44]
A
That coming up, it's not just Democrats and Republicans fighting on Capitol Hill. We'll dig into the battle brewing between big banks and big crypto next. And Capex spending was a major focus of second quarter tech earnings. Steve Kovac is in the field with a look at how Microsoft is putting its money to work.
- [40:04]
C
Mike and Melissa, I'm in Mount Pleasant, Wisconsin at Microsoft's latest AI data center.
- [40:09]
A
This is a 3 billion billion facility.
- [40:11]
C
Opening at the beginning of next year. We're getting a first look inside how these facilities look. I'm going to have an exclusive interview with Microsoft President Brad Smith coming up at the beginning of Power Lunch.
- [40:21]
A
In the meantime, the exchange will be back in June. Welcome back. The crypto industry kicking off a new lobbying campaign on Capitol Hill, taking on the banks over a provision in the Genius Act. Emily Wilkins is on Capitol Hill for that story. Emily?
- [40:39]
I
Hey, Mike. Well, yeah, a battle between banks and crypto, it's heating up on Capitol Hill and it's all over who gets to offer customers interest now. Currently, crypto is banned in that genius bill, as you mentioned, from offering customers interest on their stablecoins. But crypto exchanges can and do offer rewards that often act like interest. Banks want to use an upcoming bill on crypto to ban such rewards. And banks cited a Treasury report showing that 6.6 trillion could go from bank deposits to crypto, limiting capital and hurting community banks. I spoke yesterday with Coinbase CEO Brian Armstrong, and he dismissed the argument as simply banks trying to tilt the playing field.
- [41:22]
A
I think it's really, it's a. It's a ghost. It's a ghost story. It's a bogeyman, right, that they're putting out there, putting the small banks, the community banks, as kind of this front person, when it's really the large banks that are the ones funding this behind the scenes to try to protect their own interests.
- [41:39]
I
JPMorgan's Jamie Dimon was also on Capitol Hill yesterday, speaking with senators on the economy. But he told me that he's not against crypto, but that lawmakers need to be very thoughtful about any regulations. The larger crypto bill is still in the works, but the senator leading the push, Cynthia Lummis, told CNBC in a statement yesterday that she wants crypto exchanges to continue to offer customer rewards. If that makes the final bill, it would be a huge win for the crypto industry guys.
- [42:08]
A
So, Emily, I wonder, when the bill was written, as it now stands, and it was prohibiting these exchanges from offering interest, was it a known thing that these rewards were, you know, part of the offering? And in other words, was it always a loose poll? Or did the exchanges come out and say, oh, here's a workaround, we'll see if we can get this through.
- [42:32]
I
You know, when I've talked with banks, what they say is that, look, at the time, we wanted to have a compromise. We want to get things worked out. If you remember, of course, President Trump was encouraging that bill to get to his desk before the August recess. They really wanted to make that timeline, but they knew that they were going to have another bite at the apple because that stablecoin bill, it's very narrow. It's just focus on stablecoins. The real prize for a lot of these crypto groups is this larger market structure bill that is now in the works. And so they knew there was going to be another bite at the apple and another chance to go back. And so this is why banks are now making their big push around this singular provision to see if they can potentially get changes.
- [43:10]
A
Interesting. Thank you, Emily, for the color.
- [43:15]
E
Coming up Metta combines AI and AR rate resistance for surplus and Nike regains its footing. All that and more coming up in rapid Fire. The Exchange will be right back. The Exchange. Let's catch up on a few more stock stories on our radar. It's time for Rapid Fire. First up, Meta debuting new AI wearables at its annual Connect conference. Meta Ray Ban displays will retail for $799 a pair and feature an in lens display and a neural wristband that allows users to send messages, watch videos and get directions. I feel like this is one of these devices you don't know you really want it or need it until you have it.
- [44:04]
A
I suppose. Yeah, like a lot of these things or maybe until you try it. I don't know. I mean these people keep, I understand why these companies keep trying. It's insane that people just stare at this brick, you know, I think the question is though, is it going to be like voice commands that gives you AI output somewhere else, or do you actually need something in front of your eyes?
- [44:24]
E
The glasses. Yeah, but the glasses that were already on the market were pretty remarkable. So any sort of upgrades? I mean, the ability to shoot video, to listen to podcasts without having any sort of device in your ear. So it's very, it's interesting.
- [44:38]
A
It is.
- [44:39]
E
Next up, a new note from Mizuho laying out the impact of yesterday's rate cut across the Fintech analyst Dan Dolev writes, bank processors like Fiserv exchanges, both equity and crypto and lenders like Affirm and so far stand to benefit the most from lower rates, while stablecoin issuer Circle is likely to be the most adversely impacted.
- [44:57]
A
Yes, because they, all they are is they just earn money off a float.
- [45:02]
E
Right.
- [45:03]
A
So it's essentially just an interest rate spread off of their, you know, the collateral that they, that they hold. Of course, stock is up circle because it's like 50% off its post IPO high. So you know, risk appetites are running right now.
- [45:15]
E
Topic 3 here. RBC bullish on Nike upgrading shares to a buy, raising its price target to 90 from 76, writing Nike is taking the right steps. RBC sees improvement in Nike's running shoe offerings and says its new organizational structure will support faster decision making. FIFA World cup also will help.
- [45:33]
A
Exactly what I was going to go to. It's actually becoming a little more of a theme even on a macro basis. You're hearing some people talk about growth drivers for the overall economy next year. I mean, as you know, if you thought that international travel was a weak point this year as it was. Well, it's coming back next year. And then for Nike, I feel like people are just weighing in and sort of saying, okay, now I believe the potential turnaround price to sales ratio is really low on a decade basis. Maybe it's, you know, they have plenty of room for improvement.
- [46:02]
E
It's interesting. Nike is part of a cohort of companies that had great brands, have been the incumbent for so long and then get knocked way off. Like I used to. Starbucks, for instance.
- [46:11]
A
I used to run that chart all the time. Starbucks. Disney was in there for a while. Under Armour, of course.
- [46:16]
E
And finally the bank of America Institute out with a new jobs report on jobs most at risk from AI. They found fast food workers, retail salespeople, cashiers, laborers and customer service reps among the most vulnerable. I thought was interesting. This is automation as well. So obviously a lot of this will be displaced by automation. I looked selfishly for news analysts.
- [46:39]
A
That's right.
- [46:40]
E
And that was way down on the list.
- [46:41]
A
Not there. We can take heart. Look, people don't need to hear us.
- [46:44]
E
They want people to digest and bring it home.
- [46:48]
A
Cleaners and janitors. I was unclear on why that was.
- [46:51]
E
Vulnerable, but I guess robots maybe.
- [46:53]
A
Yeah, I guess so. That is it for us. Thank you for watching the exchange. Power lunch starts now.
- [46:58]
B
You've been listening to the exchange. Make sure you're subscribed to get each episode every day, same time, same place. Department of Rejected dreams.
- [47:08]
F
If you had a dream, rejected IKEA.
- [47:09]
E
Can make it possible.
- [47:10]
A
So I always dreamed of having a man cave, but the wife doesn't like it. What if I called it a woman cave?
- [47:17]
B
Okay, so let's not do that.
- [47:19]
E
But add some relaxing lighting and a comfy IKEA hofburg ottoman.
- [47:22]
B
And now it's a cozy retreat.
- [47:23]
F
Nice.
- [47:24]
B
A cozy retreat, man. Cozy retreat, sir.
- [47:28]
E
Okay.
- [47:29]
F
Find your big dreams, small dreams and cozy retreat dreams in store or online at ikea.us dream the possibilities.