Novo Nosedives, New AI Darlings & Buy the Former High-Flyers? 11/24/25

Summary

Podcast Summary: The Exchange (CNBC)

Episode: Novo Nosedives, New AI Darlings & Buy the Former High-Flyers?
Date: November 24, 2025
Host: Dominic Chu (in for Kelly Evans)

Overview

This episode dives into the latest market movers and business headlines as the holiday season gets underway. Key themes include shifting expectations for Fed rate cuts, a deepening split in retail performance, the divergent fortunes of high-flying healthcare names, and the surging momentum behind new AI offerings from Google and Alibaba. Guests discuss what’s driving recent stock moves, whether battered tech names are bargains, and the growing role of AI regulation in Washington.

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Key Discussion Points & Insights

1. Fed Rate Cut Expectations and Market Sentiment

[00:52–05:14]

• Steve Liesman (Federal Reserve Update):
  • The market is increasingly betting on a December Fed rate cut, with probabilities now at 67%.
  • The Fed appears more concerned about job market weakness than inflation risk.
  • Official commentary and data support this, with John Williams (NY Fed) saying:
    "My assessment is that the downside risk to employment have increased...while the upside risk to inflation have lessened somewhat." (01:57)
  • Several Fed members remain cautious and might dissent, but the overall tone is dovish.
  • Upcoming PCE inflation data could influence the final decision, though jobs data will lag.
  • The market could see further tailwinds if a rate cut is delivered or strongly telegraphed.

Memorable Quote:
"One way dissenters could be convinced ... would be [if the] Fed positioned themselves for a January pause." — Steve Liesman [03:52]

• Dominic Chu & Steve Sosnik (Market Reaction and Macro):
  • Markets have pivoted in sentiment—"the mojo has changed"—after recent Fed commentary. [06:26]
  • Bitcoin's and stocks' correlation, termed "nasty," reflects broader risk appetite swings tied to Fed expectations.
  • The market seems to "need" a Fed rate cut for further gains:
    "Like it or not, the stock market is very dependent upon that." — Steve Sosnik [07:46]
  • Fundamentals (such as dividend stocks with strong cash flow) should be prioritized, especially as leverage remains a risk in volatile asset classes like crypto.

---

2. Health Care: Novo Nordisk Plummet & Eli Lilly's Rise

[11:20–14:45]

• Novo Nordisk drops 6% after Alzheimer’s trial disappointment, hitting a four-year low. Meanwhile, Eli Lilly soars to a $1 trillion market cap.
• Evan Sagerman (BMO Capital Markets):
  • Lilly is consistently outperforming due to better execution, while Novo faces internal headwinds and could become a "value trap".
  • On relative valuation:
    "If you want a value trade in healthcare, go elsewhere besides Lilly." — Evan Sagerman [13:31]
  • Top picks outside GLP-1 drugs include Gilead Sciences (HIV leadership) and smaller biotech/hematology names.
  • Investors should be wary of chasing value in Novo solely because of its underperformance.

---

3. The Holiday Retail Bifurcation

[16:38–21:36]

• Steve Sadov (Former Saks CEO):
  • The U.S. consumer remains resilient, with ~4% consumption growth and a robust outlook for the holiday season.
  • There’s a pronounced "K economy" or split:
    • Higher-income consumers continue strong spending (luxury, premium retailers).
    • Lower-end consumers are stretched, gravitating toward value and off-price retailers (e.g., Walmart, Costco, TJX).
  • Execution in value and innovation is key. Walmart and Costco are attracting affluent customers and competing on multiple fronts, including fashion and membership.
  • Department stores and certain mid-tier players are losing share to off-price and value-focused formats.
  • The convergence of consumer segments is most apparent at retailers offering both price and innovation.

Memorable Quote:
"We had about a .9 R square between the stock market and luxury sales." — Steve Sadov [17:29]

---

4. Bitcoin’s Sell-Off and Risk Sentiment

[23:22–25:47]

• Mackenzie Segalos (CNBC Crypto Reporter):
  • Despite a mild rebound, Bitcoin remains fragile. ETFs are experiencing record outflows, with analysts warning of self-reinforcing downward momentum: "For every $1 billion pulled from the ETFs, Bitcoin falls about 3.4%." — Citi estimate [24:09]
  • The risk-off environment extends to crypto, which is behaving more like a high-beta tech stock and closely tracking the NASDAQ 100.
  • Some institutional buyers stepped in as Bitcoin held the $80,000 level, but broader participation is lacking.

---

5. Are Former High-Flyers Bargains?

[28:56–34:49]

• Victoria Green (G Squared Private Wealth):
  • Oracle (ORCL):
    • Down 23% in November but still up YTD; remains a buy due to AI investments and manageable leverage.
    • “You want a growth company pursuing growth during transformative times like this.” [29:45]
  • Palantir (PLTR):
    • Down nearly 20% this month, but a leader in government and commercial AI, with strong revenue growth. Also a buy.
    • “They are the leader in software and they’re going to modernize…maybe modernize the US Government.”
  • Robinhood (HOOD):
    • Down 23% this month, but not just a "crypto play"—growing in options, equities, prediction markets, and sports betting. Still bullish.
  • DoorDash (DASH):
    • Down 26%, but a hold (not a buy) due to questions about growth sustainability and increased competition, including the impact of AI on its platform.

---

6. AI Race: Google's Gemini and Alibaba's Qwen

[35:59–38:28]

• Deirdre Bosa (CNBC Tech Reporter):
  • Big story: Breakout chatbot products (Google's Gemini, Alibaba's Qwen) from companies with full-stack systems—models, infra, data, distribution.
  • Both stocks have roughly doubled in the past year, but Alibaba trades at a much lower forward P/E.
  • The China vs. U.S. AI race is characterized by efficiency versus heavy investment, with U.S. tech’s collective market cap 10x China's. “It really comes down to this question—what is the global AI system going to be built on? Is it going to be on the American stack or the Chinese stack?” [37:24]
  • Opportunity for further rerating in Chinese AI players if they can continue to innovate efficiently.

---

7. The Battle Over AI Regulation

[39:06–42:00]

• Emily Wilkins (CNBC):
  • $10 million campaign from Build American AI (supported by leading Silicon Valley figures and VCs) launches to push for a national AI regulatory framework—seeking to pre-empt a patchwork of state laws.
  • The White House is preparing executive action to pressure states on AI regulation if Congress can’t enact comprehensive federal rules.
  • Competing priorities: Should progress be led by the states while federal standards lag, or pause state-level actions until federal rules are clear?
    • "We should eventually have a federal AI standard. I strongly agree with that. But…should we stop the states from making any progress before the feds have solved the problem?" — NY Assemblyman Alex Borres [40:26]

---

8. Sales Tax Bonds and Holiday Shopping’s Impact

[42:59–46:17]

• Dan Close (Nuveen):
  • Every holiday transaction (in states with sales tax) generates cash for municipal infrastructure through sales tax bonds.
  • These bond types are increasingly important, especially in states relying more on sales tax due to lack of income taxes.
  • Investors focus on debt service coverage, tax pledge breadth, and resilience to shocks when selecting these bonds.
  • Sales tax rates and structures vary widely state to state.

---

Notable Quotes

• "The stock market is very dependent upon [Fed rate cut expectations]." — Steve Sosnik [07:46]

• "Lilly will continue to outperform…Novo could become a value trap versus a value play." — Evan Sagerman [13:31]

• "You want a growth company pursuing growth during transformative times like this." — Victoria Green, on Oracle [29:45]

• "What is the global AI system going to be built on? The American stack or the Chinese stack?" — Deirdre Bosa [37:24]

• "We should eventually have a federal AI standard. But…should we stop the states from making any progress before the feds have solved the problem?" — NY Assemblyman Alex Borres [40:26]

---

Timestamps: Important Segments

• Fed Rate Cut Outlook / Macro: [00:52–05:14], [06:26–11:20]
• Healthcare Divergence: Novo vs. Lilly: [11:20–14:45]
• Retail Bifurcation and Consumer Health: [16:38–21:36]
• Bitcoin, Crypto, and Risk Factors: [23:22–25:47]
• Tech High-Flyers: Buy or Hold?: [28:56–34:49]
• AI Competition: Gemini vs. Qwen: [35:59–38:28]
• AI Regulation Moves: [39:06–42:00]
• Sales Tax Bonds & Holiday Shopping: [42:59–46:17]

---

Episode Tone

The tone is analytical and cautious-yet-optimistic, mixing Wall Street pragmatism with curiosity about disruptive innovation (AI, crypto, changing consumer habits). Both guests and hosts keep the discussion accessible but data-driven, making big macro themes relevant to listeners' investment decision-making.

---

For listeners: This episode is a one-stop snapshot of November’s major economic, tech, and market trends—providing actionable perspectives for both professionals and lay investors as the year winds down.

Transcript

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[Victoria Green]

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[Steve Liesman]

All right.

[Dominic Chu]

Thank you very much, Scott. Welcome to the Exchange. I'm Dominic Chu in for Kelly Evans. Today, stocks are trying to build on Friday's bigger gains with growth and momentum stocks leading the way. Big technology broadly higher. Google is the standout once again on Gemini Momentum. That momentum is sending ripples through the entire upper echelons from worry to wonder with Marc Benioff, the latest to weigh in, calling it a major breakthrough. We're going to have more on that story ahead. And speaking of, AI Alibaba's new app is reaching 10 million downloads in just the first week out there for beta test. That stock is up nearly 5%. And Bitcoin prices slightly higher today, trading back around roughly the 88,000 level after falling as low as roughly 80,000 just last week, is down more than 20% in a month alone. But we're going to begin with the latest on the Fed and whether or not a rate cut is becoming more likely. Steve Liesman is with us with that story. Steve, this is interesting because the probabilities over the last month for a December rate cut have gone all over the place. Where are they now?

[Steve Liesman]

It's been a fun roller coaster ride if your money wasn't at stake. But a divided Fed looks likely to cut rates in December. Now, despite the possibility of a large number of dissents, comments by leading Fed officials and reporting by CNBC suggest the Fed is on balance more concerned with a weakening job market in that side of the mandate than it is inflation running too hot in comments also reflect thinking of that likely also reflect thinking of Fed Chair Jay Powell near Fed President John Williams said last week, quote, my assessment is that the downside risk to employment have increased as the labor market has cooled, while the upside risk to inflation have lessened somewhat. The limited Official data backs up the concern. Take a look at this. When the number of Americans unemployed for 27 weeks or longer has marched steadily higher since May and remains elevated despite a slight decline in the recently released jobs report for September, steady rise in continuing claims. Another piece of the argument there. Layoff announcements from Challenger have been high and negative. ADP weekly data that we've had all that backing up. To be sure, several committee members, including several voters, have expressed more concern with elevated inflation and supported a cautious approach that could mean they dissent in December. But Governors Myron Walker, Waller and Bowman and now Williams look ready to vote for a cut. Williams likely reflects Powell's view that the Fed will remain restrictive even after a cut. And so where are we now on that roller coaster? 67% for a December cut right now. That's one of the more recent highs we've had. And then that same cut, well, it's got an 80% probability of happening by January. One way dissenters could be convinced to position the Fed depending upon the data for a January pause would be January pause. Waller, a supporter for December cut, suggested an interview today with Fox Business that the Fed should go meeting by meeting in January. So a call it, I guess, a hawkish cut.

[Dominic Chu]

It also feels as though they keep talking about this idea that every meeting is live and every meeting could be dead. It's all dependent on the data. Right now we're starting to slowly get that data coming back online. So as we talk about the outlook for next year, it seems as though the predominant fear remains, and rightfully so, the focus on jobs as opposed to inflation. But both are still present.

[Steve Liesman]

That, that is, that is 100% accurate. And I will say, you know, I need to double check this. I believe it's next Friday. We are going to get the PC number. So that's a good, a good sign. The Fed will have that before the December meeting. What they won't have are the October November jobs reports. That'll be important. And then they'll get another inflation report after that. So they'll have a little bit of the inflation to be able to look at that. I think that we're looking at is maybe three dissents, maybe four dissents. Depends upon if Myron, who was wanted 50, if he gets only 25, would he dissent again? He'll be happy with that. But I think also the guidance may be, you know what, we've done this. We're a little bit closer to neutral. We're towards the top end of the neutral range. Might be time to stop and take a pause here to let the data catch up. A lot of stuff happening next year, Dom, that I don't know we get to talk a lot about. But there's a very, there's an expectation of a large increase in refunds happening and happening early in the year that could power consumer spending.

[Dominic Chu]

All right. So a lot of wild cards at play there. Steve Liesman, thank you very much for that. All right. Now, Steve, sticking with stocks trying to build on Friday's gains. As you can see right now, the Dow industrials were in recession highs, by the way, we're up two thirds of 1% of the Dow Industrials to a level of 46,540. The S&P 500 is up 105 points. That's about 1 1/2% gains. 6,708 is the level we're at right now. And the NASDAQ composite is up 2.5% to 22,853. Now it's a similar story here for bitcoin coming off its worst weekly performance since late February. All that correlation has caught our next guest's attention. He calls the relationship between bitcoin and stocks, quote, unquote, nasty and says the market is focusing on the Fed and that's a welcome change. So for more on that story, let's bring in Steve Sosnik, the chief strategist over at Interactive Brokers. Steve, you just heard Steve's report on the Fed and the way that they're maybe thinking about the way the interest rate outlook is going to shape up inflation, jobs are still a problem, but we're much more focused on jobs. How does that compare and contrast to what the market is telling us about the overall macro picture?

[Steve Sosnik]

Well, I mean from Friday on when basically when John Williams, you know, said that that looks like that looks he's in favor of a cut. The market has completely changed its mindset. It's completely the mojo has changed. The whole mood has changed now. But again, to some extent we were, we were enthralled to certain various risk off types of trades and those have abated. You mentioned bitcoin, that nasty correlation which was, which was in many cases powering some of the negative move. But I think now that we're seeing rate cut expectations improve, so is the market. And that's, that's understandable and that's quite fair because that is a fundamental, that that does tend to move stocks. I'm happy when the market moves higher on fundamentals. I'm not necessarily quite so happy when it, when it just doesn't, you know, it just sort of does its own thing without regard to what's going on around it.

[Dominic Chu]

You know, over the last several weeks, I've asked the question, and I think many of our, our reporters and anchors here at CNBC have asked the question of various guests about whether or not the Fed needs to cut rates in order for the market to keep going higher. Based upon the reaction that we've seen over the last week or so in the markets, it sure as heck appears as though the market needs a Fed rate cut to keep going higher. Does that Fed variable still need to be tilted towards rate cuts in order for the, the catalyst to be to the upside?

[Steve Sosnik]

Yes. I mean, the question is, does the economy need the rate cuts vis a vis. Does the market need the rate cuts? We could, we could have that conversation with someone like Steve Liesman for, for hours, but, you know, again, they're navigating in the dark and they're, they're deciding that. The Fed is deciding that, all right, we're leaning toward, you know, caution rather than caution rather than, than not. And the stock market likes it. We, we had a rough November as rate cut expectations fell from relatively high numbers, 80 or so to about 35 or so, 30, 35. Now we're back closer to 70, 75 or more. And all of a sudden the market's in a much better mood. So, yes, like it or not, the stock market is very dependent upon that. You know, maybe I should create a VIX for, you know, for rate cut expectations or something, but they've been volatile and so has the market.

[Dominic Chu]

And you could look at the move index in terms of bond volatility to get some of that, that kind of inkling about it. The AI trade has been a powerful force in the market so far. And maybe that rate cut story has to interplay with the AI trade as well. But you mentioned some of the correlations between even cryptocurrencies and the NASDAQ and the S&P 500. How does that play out in your mind from a strategy standpoint? Is this market well positioned for a next leg higher, or is this a consolidation phase that becomes wait and see about what the future catalysts are?

[Steve Sosnik]

The market had a bit of a paradigm shift over the past few weeks. Some of the moving averages that we'd come to depend on, you know, the 50 day started to turn lower. We broke through the 50 day with, with some vengeance. We actually got through the 100 day a little bit. And, but we're, we're back above that now. What are the reasons that I see Bitcoin correlating with first the Nasdaq and then to a larger extent with the S&P 500? Because NASDAQ and the S&P 500 correlate well because it's the same MAG7. The same MAG7 moving both of them. And I do see that as a proxy for risk among a lot of investors. And the reason I say that is a lot of people got into crypto this year who weren't your 25 and 30 year old, you know, Hodlers, you know, the people who just were true believers. These were what I'm going to call crypto tourists. They were able to get into it because of ETFs. It broadened the exposure. But as a result, to a lot of these other investors, it's, it's just another investment. And if it's not performing, it's easier to get into. It's also easier to get out of. And so I think that's why that sentiment spilled back from one to the other. The difference is in a lot of crypto situations, you, not the ETFs, but in crypto itself, you have so much more leverage, so it can be much more susceptible to downswings. Remember, if you're leveraged, 20 to 1, 5% move wipes you out. And so you do get those situations.

[Dominic Chu]

Let's put a point on this so that we can leave our audience here with a takeaway. If all of those factors are in play, what exactly should be on the shopping list on these pullbacks like we've seen?

[Steve Sosnik]

I think the shopping list should be the stuff that you really believe the fundamentals upon. You know, that's an awkward sentence, but basically, you know, I still think it's never a bad idea to pick up stocks that pay a dividend, particularly if you're looking at rate cuts. If you have a stock that's a solid dividend payer in an environment that first as long as the cash flows support the dividend payments. But if you, if you could do that without borrowing money, I think that's, that's solid way to go. I think if you're just follow the cash flows is really the way I would, the way I would put it, some of the Mag 7 stocks have solid cash flow. So I don't, I wouldn't say throw them out. But on the other hand, the ones that are needing to borrow money in a big way can, can be adding a lot more risk to A portfolio at a time, it's not necessarily the time to be doing it.

[Dominic Chu]

All right, Balance Sheet Health and focus, for sure. Steve Sosnik, Interactive Brokers, thank you very much. We'll see you soon. Thank you. All right, so outside of technology, health care is in the spotlight, of course, today, Novo Nordisk shares falling to a four year low after saying its highly anticipated Alzheimer's trial failed to meet some of its end goals. Those shares are down about 6% right now. Now, this comes just a few days after novo's big rival, Eli Lilly, became the first pharmaceutical company ever to reach that vaunted $1 trillion market cap level. Lilly shares are outperforming Novo by a whopping 86% so far this year. Now, for more on that health care space, let's bring in Evan Sagerman, the head of health care research over at BMO Capital Markets. Evan, thank you very much for being here with us. Take us through the dynamic. I mean, GLP1s have been the focus for such a long time. Now. Is there anything that gets this competitive dynamic between Lilly and Novo to close the gap a bit in the coming months and quarters?

[Dom Chu]

Well, first off, thank you for having me. And I think just today there's a lot of anticipation into this Alzheimer's data. But taking a step back, it seems that Lilly continues to execute and continues to succeed, whereas they're beating expectations on earnings rating guidance where Novo misses and has to cut expectations. So you're seeing this big bifurcation. And I think that really, you know, is a product of the key differences at these two firms. Lilly is just better at executing at this point. There's been a lot of issues internally at Novo. We had a new CEO, you know, we had the failed Met Sarah bid. And frankly, I think that they are kind of running out of steam. And I don't know if they can ever converge and be kind of the equal players in this duopoly at this point.

[Dominic Chu]

Now, the valuation is also an issue here as well. There are some folks who believe that value investing is the way to go when it comes to mega cap type stocks like this. The valuation gap is interesting here between these two companies, but one of them may be justified or maybe both of them are justified. How exactly then as an analyst do you handicap whether the risk reward is appropriate at the levels that we're seeing for both companies, for sure.

[Dom Chu]

So when I look at my entire healthcare investing kind of space, I don't just look at Lilianovo, I look at Pfizer, Bristol Merck as well. So if you want to take a value perspective, I look at a Pfizer or a Merck. When it comes to, you know, debating between the obesity duopoly, you have to, you know, there how do I frame this? The big valuation disconnect is because Lilly continues to execute. I'm not comfortable with the trajectory that Novo is going and I think Novo could become a value trap versus a value play. If you want a value trade in healthcare, go elsewhere besides Lilly. But I think Lilly will continue to outperform the years to come.

[Dominic Chu]

Now between Eli Lilly and Novo, we kind of get your view there. Are there places outside of GLP1 that investors can be looking right now for what the next opportunity could be for sure.

[Dom Chu]

So to my top picks, one in small and mid cap health care. Is this medicine or rare hematology play? They're more for the it's more of a biotech play. I also really like Gilead Sciences. They are the leader in HIV and I'm very bullish on their long acting prep business. Beyond that, I think they'll continue to be a leader in cell therapy. Even though I love the GLP1 space, my top picks actually aren't in the GLP1 space.

[Dominic Chu]

All right, Evan Sagerman over at BMO Capital Markets. Thank you very much for the look there. Thank you.

[Dom Chu]

Thanks, Don.

[Dominic Chu]

Coming up on the show here this week marks the first big test for the holiday shopping season. We're going to be joined by former Saks CEO Steve Sadov with what he expects and the group he sees continuing to take share from one area of the retail market in particular. Those names coming up next and some of the Techtrade's high flyers delivering a more down to earth performance so far this month you are looking at one of them in this mystery chart. Our trader is a buyer at these levels. That name and a few more to scoop up coming up on the show. This is the Exchange on CNBC. Your new home is now ready. Dr. Horton, America's builder has new homes that are ready today with new construction communities in Ellensburg and throughout the Greater Seattle area. Dr. Horton has the right home for you. At Dr. Horton we're still building with flexible living spaces, smart home technology and two and three car garages. More communities and more homes available every day. Find your new home in Ellensburg now [e-mail] Dr. Horton, America's builder and equal housing opportunity builder.

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[Steve Sadov]

Well, Dom, I think your observation is right. The consumer has held up extremely well. If you would ask me three, six months ago whether or not the consumer would be holding up with a plus 4% type of consumption trend, I would have said I would have been surprised because you saw so many elements that looked like they were going to weaken. But month by month the consumer has held up. They're continuing to shop. Now you do have a K economy and a cake economy is essentially the high end consumers doing very well. The stock market they're tied to, I used to say it, sacks. We had about a.9 R square between the stock market and luxury sales. And the lower end consumer is very stretched. And you can see that with a focus on value being what is winning. So you have this bifurcation among the winners and the losers. But overall, the consumers weathered the tariffs. They continue to shop. The outlook for the holiday season is for about 4% growth versus year ago. You saw that similar number in the month of October. We're already seeing the heavy discounts that are coming in for Black Friday. So I expect this to be a pretty healthy season.

[Dominic Chu]

All right, healthy season is one thing, but are there certain companies out there? Steve, you're an operator at your heart. You've had, you've had decades of experience doing it. Which types of companies are executing well and properly in that kind of environment and which ones in your mind maybe or not well.

[Steve Sadov]

I think the operative words are value and innovation and those companies that are delivering against value and what I mean by that are the Walmart, the tjx, the off prices, the Ross stores, extremely good execution and tight price points. You look at a targets had a harder time. I think they're doing, trying to do a lot of the right things but I don't believe they're delivering the the value that you're getting. At a Wal Mart as an example, I think the off price players are taking share from the department stores. The department stores are executing but the high, low department store model is much more stressed relative to the off price retailers. So now they're within each of them there are companies doing better and worse relative to execution. But I do think that off price, the value that's being provided is winning in the marketplace.

[Dominic Chu]

Steve, we've made a lot of this case shape that you referred to. This idea that higher end consumers and lower end consumers, mid scale consumers are kind of diverging. One place where we are seeing a little bit of a convergence, a narrowing of that case so to speak is in places like a Costco or a Walmart where some of the higher income shoppers are now starting to traffic at some of those locations more than other ones they have in the past. Is that a trend that you see continuing in that regard? This idea that both high end and middle and lower end consumers all kind of go to certain specific locations like perhaps a Walmart or a Costco?

[Steve Sadov]

Well, I think Costco Walmart are winning on multiple dimensions. Costco is a great place to for a find. It's a membership model. Walmart plus is a membership model. Both of them are offering great value. I think that that trend for both of those companies are continuing and they're doing a good, both of them are doing a much better job in what I would call innovation in fashion. So Wal Mart for example called out in their earnings call the growth that they're seeing in the fashion apparel space, that was never a place that they were winning. They were always 6, 50, 60% grocery store and driven by commodity apparel. Now they're going after innovation and fashion and taking share from Target which used to have the Target innovation model. And I think that you're seeing Costco also deliver against that find that the high end consumer wants. So you are seeing a big growth in the $100,000 plus customer at both Walmart and at Costco. And I think that that and you're seeing a trading down to the from the lower end consumer. They're also buying at the Walmarts but they're also buying at the dollar stores and going to the off price players.

[Dominic Chu]

All right, the holiday shopping season set up there from Steve. State of thank you very much. We'll see you soon, sir.

[Steve Sadov]

See you.

[Dominic Chu]

All right. Coming up on the show, last week's crypto sell off wiped out nearly $400 billion in market cap for the overall industry and left bitcoin on pace for its worst monthly performance going all the way back to 2022. We're going to look at why the weakness is persistent and why investors are not rushing to buy the dip in crypto. And after many in the industry said Google was being left behind in the air race, that stock is at an all time high today as its new products win the praise of Wall street and one very prominent tech CEO. That story coming up ahead. The Exchange is back in two. Your new home is now ready. Dr. Horton, America's builder has new homes that are ready today with new construction commun communities in Ellensburg and throughout the Greater Seattle area. Dr. Horton has the right home for you. At Dr. Horton, we're still building with flexible living spaces, smart home technology and two and three car garages. More communities and more homes available every day. Find your new home in Ellensburg now [e-mail] Dr. Horton, America's builder and equal housing opportunity builder.

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[Steve Liesman]

All right.

[Dominic Chu]

Welcome back to the Exchange. Stocks are in rally mode right now with the NASDAQ close to session highs. You can see there the Dow industrials up 2/3 of 1%. The S&P is up about 1.5% and the tech heavier NASDAQ index is up a whopping 2.5% right now. If you take a look at some of the moves around where we are relative to record highs, we're still a ways away from there but still a solid move higher now. Also, bitcoin is moving slightly higher today after posting its worst week since 2022. Despite the small uptick today, investors do not seem to be aggressively buying this particular sell off. So what exactly is weighing on sentiment in crypto? Let's bring in Mackenzie Segalos for more on that story. Mac, what exactly is holding people back from buying the dip more aggressively in places like bitcoin?

[Deirdre Bosa]

So Don bitcoin, as you said, it's back in the black. After a choppy start to the week, it's recovered above that $88,000 price threshold. And that rebound does offer some relief after bitcoin's worst week since February, one that slashed more than 30% from last month's record high and wiped out nearly half a trillion dollars in market cap. But even with the recovery we are seeing this morning, the market remains Fragile spot Bitcoin ETFs, once a driver of inflows, have now seen more than three and a half billion dollars in redemptions this month, putting November on pace to be the worst since their debut. You've got analysts at Deutsche bank and RBC saying that this latest bounce may not hold. They point to a broader risk off mood, investors retreating to the sidelines and then signs of fatigue after months of relentless bullish momentum. Analysts also warn that these flows are becoming self reinforcing. So as prices drop, more capital exits, which in turn pressures the price. Citi is estimating that for every $1 billion pulled from the ETFs, Bitcoin falls about 3.4%. But Friday brought hope of stabilization. Bitcoin did resist falling below that key $80,000 level. And we also saw a quarter billion dollars in net positive flows into the funds, which suggests that some institutional investors are stepping back in to buy the dip. But even with gains today, there are macro forces weighing on sentiment with bitcoin behaving less like digital gold and more like a high beta tech stock closely tracking the NASDAQ 100, which jumped higher this morning led by a rally in Alphabet. So we're going to have to wait and see if this latest recovery will be enough to bring investors off the sidelines.

[Dominic Chu]

All right, Mac, thank you very much for the update on crypto there. We appreciate it. Now let's send it over to Bertha Coombs for a CNBC news update. Good afternoon, Bertha. Afternoon, Dom. A federal judge just dismissed criminal indictments against former FBI Director James Comey and New York Attorney General Letitia James. The judge ruled the appointment of interim U.S. attorney Lindsey Halligan, who brought the charges, was invalid, so he dismissed the indictments. The Justice Department is likely to appeal. The Department of Defense posted on X today that it has received serious allegations of misconduct against current senator and retired Navy captain and astronaut Mark Kelly, which could lead to a recall to active duty for a court martial. The Arizona Democrat was one of six lawmakers who recently made a video telling members of the military to refuse unlawful orders. Kelly has yet to comment. Google is pushing back on reports claiming it changed its policy to use Gmail to train AI models and the only way for users to opt out is by disabling some smart features. A spokesperson tells the Verge the reports are misleading and says the company has not changed anyone's settings and it does not use Gmail content to train Gemini, its AI engine. Dom all right, thank you very much, Bertha, for the news update there. Coming up on the show, it's been a November some investors would like to not remember. With all three averages on track to finish the month lower, we're going to look at whether some of the hardest hit stocks in the market are now buying opportunities, including this thing down roughly 23%. That mystery chart coming up next. And Oracle of course, in that mix as well. The Exchange is back after this.

[Steve Sadov]

The original whiskey style of America is what we started distilling. However, I anticipate vodka actually outselling everything and the fact that America, no matter what anyone says about the death of the alcohol industry, is still very keen on vodka. We get our labels from the uk. Our design is very unique. The corks we get come from Mexico. When we started out, we bought all of our glass from the usa and it just so happens that the company that we bought it from got bought by an Indian conglomerate, offshored all the molds and all of a sudden our costs are increased by 50% and the packaging cost is a significant proportion of the cost of a bottle of liquor. The interesting part of the whiskey business is that you make the product and then it ages for a number of years. You can't just say, all right, we'll just stop making it, because it's already been made years in advance. And as whisky demand has softened for American products, partly due to the trade war, there's an increasing supply of whiskey here that is offered at a lower price. So that becomes very challenging for us.

[Dominic Chu]

Welcome back to the Exchange. Stocks are higher today, but it's been a pretty rough ride in November for the major averages. The Dow and the S and P are both down about 2.5%, but the Nasdaq is down more than 4%. As tech sells off on possible bubble concerns, that's brought some of the highest flyers in that market Back down to earth. And we've got the trades on four of them. So joining me now is Victoria Green, the chief Investment officer at G Squared Private Wealth. She's also a CNBC contributor. Thank you very much, Victoria, for being here. Right now, let's start first up with Oracle shares. That by the way, was our mystery chart. Those shares are down 23% so far this month alone, but they're still up 21% on a year to date basis. On that longer term chart. As you're seeing, concerns are starting to build about its credit. But Victoria, you're a buyer of Oracle.

[Victoria Green]

I'm absolutely a buyer of Oracle. Unless you think the trade is seriously just a huge bubble and never going to materialize. AI is being built off of. An AI will run off of Oracle. And I look at this and say, what else do you want Oracle to do? They have to lever it up. They have to buy GPUs, they have to build out. Do you want a growth stock to not pursue growth during one of the most transformative eras in technology since the Internet era? No. You absolutely want Oracle doing what they're doing. Yes, I understand their leverage is rising, but their, even their interest coverage and all those matrices that I'm concerned with, I feel like they can handle. And look, this is not a company moving from asset light to all of a sudden taking on debt for the first time. This is a company that's done this before. They've had debt on the balance sheet. They know how to handle this. You want a growth company pursuing growth during transformative times like this. Look, weighted average cost of capital is 4.9%. Not like this stuff is high yield. They've got their investment grade rating. Nobody's got them on watch list list. They have the capacity to do this. If you like the stock at 300, you'll love it here at 200.

[Dominic Chu]

All right, so a buyer, Victoria is of Oracle. Next up, you got Palantir. Those shares are up more than 5% today. One of the best performers in the s and P500, but still down nearly 19% in November alone. Now Victoria, you say that Palantir is winning the software race. Are you a buyer here?

[Victoria Green]

Absolutely I am. We are transforming the way business businesses operate. The business, the government, there's so much modernization that needs to happen and it' happening now quickly. And is Palantir that is leading the way. And if you look at their revenue growth, it's about 53% year over year. And they're winning not only government contracts in the US but in the uk, other allies, they're also winning commercial contracts. They have their AP training class that's been extremely successful in helping people implement AI. How do they transform data into something useful? How do they modernize their businesses? Yes, their knock was, oh, the valuation has run too far, too fast. Come down about 20%. To me, I would lag into the stock. It is catching a little bit of a falling ninth. But for me, they are the leader in software and they're going to modernize, maybe modernize the US Government. That takes a little bit for Doge. Couldn't quite do it, but maybe Palantir can.

[Dominic Chu]

All right, buyer of Oracle, buyer of Palantir. Let's go down the market cap scale a little bit here and turn to Robinhood, Also up more than 5% today, but shares are lower by nearly 23% this month to date, period, under pressure from the breakdown in cryptocurrencies, Bitcoin in particular. But you call Robinhood more than just a crypto play.

[Victoria Green]

Oh, it absolutely is. It's an everything platform. If you look at their trading volume in their transactional revenue, it's options, it's equities, crypto is a part of it. But crypto is one silo in the story for this stock. And now they're getting into prediction markets, which is the next leg of potential sports gambling. They're coming out to modernize the infrastructure or the user interface on their app. So it feels a little bit more like a sportsbook. Suddenly you have a new vertical for people that can actually kind of want to gamble on these prediction market contracts. And so for me, I look at this and say, they're absolutely winning here. Bitcoin holding 80, obviously that was crucial. We'd love to see the crypto market run. 80 was a huge support that held. That's great for crypto related stocks. But this stock isn't just crypto trading volume and needs a bull market. And crypto. This is also what's happening and how the next generation trades. So options, equities, ETF leverage, they make a lot of money on securities based lending and margin. And so I like this stock because for me, I see a lot of upside on a modernized trading platform that appeals to the next generation.

[Dominic Chu]

All right, and how about now how you're going to get your eats if you're tied to your trading desk over there at home. DoorDash shares down 26% so far this month, but still a Wall street darling. Wolf Research calling it a top pick until year end. While Jefferies has now upgraded that stock back to a buy rating just last week. Dash is reporting strong third quarter results but, but fourth quarter guidance came in a bit lighter than expectations. And Victoria, this is the name that you are perhaps not as excited about it, is it?

[Victoria Green]

And full disclosure, I use DoorDash way more than I would like to admit publicly on tv. But for me, the stock is what's the moat. As technology gets better, as AI gets better, and their platform is maybe going to be under attack from agents because if people all of a sudden use AI to order food, then they don't have an individual and a human to sell to because they want to have that relationship with direct, with the customer. So if you have the issue of the interface getting between say a platform like DoorDash and the consumer, that really is going to limit, upsell, limit, you know, sell this, do this, add on. Do you want to add this cookie in for $2? Which we all of course say yes, because we're, we're susceptible to being upsold. And so I'm just concerned on the growth of their verticals and how sustainable this platform growth is in an era of transformative technology. And so that's the question. The market also has that, yes, this is done well, but concerns going forward, can you continue to have this growth? You know, you definitely still have competition from say, Uber Eats and other platforms. And then you potentially have new competitors entering the marketplace as other platforms get better and stronger or restaurants may be able to cut out the quote unquote middleman and build out their own infrastructure more cheaply using, using agents. And so for me, I just can't do a buy here. Even though it's been under so much pressure. It's a hold for me.

[Dominic Chu]

All right, three buys and a hold. Victoria Green of G Squared Private wealth, thank you very much. We'll see you soon.

[Victoria Green]

Thanks, Don.

[Dominic Chu]

All right, coming up at the show, one tech stock that has had a standout month so far has been Alphabet. Those shares are up 12% and one of the only two MAG7 stocks higher. In November, we're going to look at what drove this month's momentum and whether it can continue and the company that might follow in its AI footsteps. And a reminder, you can get these the most out of CNBC by checking out CNBC Pro. You'll get exclusive content analysis, real time data and deep dive reporting. Just head over to cnbc.compro now for a special limited time opportunity. The exchange is back after this. All right, welcome back to the Exchange. As the race to dominate AI heats up. Two chat bots are gaining some ground here. Google's Gemini and Alibaba's Quinn. Now in fact, quinn crossed the 10 million download mark just a week after its launch. That has BABA shares surging ahead of tomorrow's big earnings report. Deirdre Bosa has more in today's tech check. Indeed. Just how important is Quinn to Alibaba?

[Deirdre Bosa]

Turns out pretty important. And really this Quinn chatbot breakout, it reinforces the pattern that Wall street is starting to appreciate in the era and that is that real breakout products come from companies with the full system. That means models, distribution, infrastructure, data. It's a proof point for Alibaba, much like Gemini 3 was for Google last week, that the company has something that its rivals do not and that is a full stack or an end to end system. Look at how the two companies compare over the last year. Both basically dismissed early in the era, but two of the biggest winners this year, nearly doubling their stock price. And when it comes to having a complete ecosystem, they both have their own models, they both have cloud businesses, established products with tons of data and custom silicon. Though Google's TPU is much further along here now. Alibaba reports tomorrow morning Dom and the question for investors is whether the same bull thesis powering Google can now travel to Alibaba. As we showed you, shares have doubled this year, both those companies. But the valuation, there's a difference here. Alibaba still lags at about 23 times forward earnings.

[Dominic Chu]

Now D if you take a look at the China versus a US air race, so to speak, just how much or how quickly do you think that these gaps start to kind of close between companies like an Alphabet and Google, like a metal platforms or Microsoft and others open AI versus what we see with Alibaba, Deep Seek and all the other names that we've come to know in China?

[Deirdre Bosa]

I mean, if you're talking about from an American investor point of view, this is a really interesting question because it depends on how much American investor want to pay attention to these open source models which are gaining a lot of relevance and a lot of steam abroad. And it really comes down to this question, what is the global AI system going to be built on? Is it going to be on the American stack or the Chinese stack? And two very, very different propositions. The American one is, you know, you're seeing hundreds of billions of dollars being spent to develop the infrastructure and the energy and the chips for this ecosystem, whereas the Chinese one is being built more efficiently. They have the power already, but they're spending far less in terms of, you know, Capex. So it comes down to this. But I will say I read this stat that was really interesting. The top 10 tech companies in China right now, I think they're worth about two and a half trillion dollars. In the US the top 10 technology companies are worth 25 trillion dollars. So perhaps some dislocation there, I don't know. But maybe some room to run for the Chinese players, especially as they're doing it more efficiently.

[Dominic Chu]

10X is big for sure. DeBosa with the check, check today. Thank you very much for that. All right. Coming up on the show, a super PAC backed by some of Silicon Valley's biggest names is launching a new campaign today. So the details on what it could mean for AI regulation next. The Exchange is back after this. Welcome back to THE Exchange. A major AI focused super PAC is launching a very big campaign today. Emily Wilkins is here on set with us with more of the details. Emily, we talked about a little of this in the past, but now the next chapter is unfolding. What's going on?

[Deirdre Bosa]

It really is, Dom. I mean, looking at how AI is dealing in Washington, D.C. and today, of course, this advocacy arm of a major AI pack, they're launching a $10 million campaign today. And it's really meant at pushing Congress to pass a national framework on AI as well as preempting that that growing number of state AI laws that we've seen. And cnbc, we got a first look at the campaign. It comes as congressional leaders, they're trying to figure out language that would override some of these state laws that the industry says makes compliance really difficult, especially for smaller companies. Now, this group is called Build American AI, but it's backed by that AI pack that we've talked about before, Leading the Future. That's the one with donors like Andreessen Horowitz, SV Angels, Ron Conway, OpenAI's graphics Greg Brockman, Palantir, Joe Lonsdale and the path forward on AI, it really has split both parties, Republicans and Democrats, with some Republicans saying that states should not be limited in regulating AI. And then of course, on the Democratic side, you had New York Assemblyman Alex Borres. He's responsible for a major AI bill in New York and was the first target for that AI pac. He was on Squawk Box this morning and said that if the federal government wants to preempt states, that's fine. They just actually have to have an alternative in place first.

[Dom Chu]

We should eventually have a federal AI standard. I strongly agree with that. But what's being debated right now is should we stop the states from making any progress before the feds have solved the problem or should we actually work together to have the federal government solve the problem?

[Deirdre Bosa]

Lawmakers have now a couple months to figure out a path forward on an AI measure. But if they can't do it, the White House has already begun to prepare an executive order that would then pressure to stop either producing or implementing these AI laws.

[Dominic Chu]

All right, it's Emily, it's slightly confusing here because not because of everything federal versus state, but also because of the kind of dueling nature of some of the programs and EOs that are happening. How is this similar or different to the executive order that's expected later on this afternoon related to artificial intelligence? Yeah.

[Deirdre Bosa]

So the executive order this afternoon, because it does get complicated, that's more about making sure that there are public, private, private partnerships that US Laboratories, that US Universities are all working together on really developing AI, staying a step ahead of China, kind of bringing about the next edge of the future and the White House's commitment to that. The other executive order that they've now kind of halted working on to try to give Congress some room to run, it would basically penalize states that come up with these comprehensive AI laws like we've seen in California, Texas, Colorado, Utah. It would basically have a task force that will review some of these and say, hey, look, AI, it's interstate commerce. And if states are regulating on that, that's a no go. And then also states could potentially lose or not be up for certain federal grant dollars if they had these AI laws on the books.

[Dominic Chu]

All right, Emily Wilkins with the complexity behind AI regulation. Thank you very much for that. Alright. Still ahead on the show, with the holiday shopping season upon us, we're going to look at how buying gifts also funds America's infrastructure. That story coming up next. The Exchange is back after this. Welcome back to the exchange. America's biggest weekend for spending is just around the corner. But remember, it's not just gifts that you're buying this year. Every time you swipe that credit card, you are helping to build roads, schools, parks, and a whole heck of a lot more. For more on how Black Friday is helping fund America, America's infrastructure needs, let's bring in Dan Close, the head of municipals over at Nuveen. Dan, thank you very much for being here. Now we always talk about general obligation revenue. This is a true revenue kind of bond situation developing. What exactly are sales tax bonds? And why are muni investors keying more on them these days.

[Dom Chu]

Thanks for having me on the exchange, Dom. I always love coming back here and talking munis. So when you're going to the mall on black Black Friday, you're going in and buying on Cyber Monday and you're swiping your credit card to buy the new blender, you're really going in to support roads and bridges, schools and parks and libraries. And that's because every time you're buying something, I'm buying something. It generates sales tax revenues. And municipalities leverage these income streams to go in and build large infrastructure projects. So, so we see states, this is a hugely important income component for states. It's about a third of their revenues. And we see it's a large component for local governments too, because they often use these sales tax bonds to leverage public infrastructure. So if you have mass transit, if you have local infrastructure with mass transit, you tend to see more sales tax structures.

[Dominic Chu]

I mean, in the New York area, we're very aware of, of this because we talk about this idea that the incoming mayoral administration in New York is talking about things like free mass transit, whatnot. But there is a difference here. When it comes to sales tax bonds, not every state is the same.

[Dom Chu]

That's right.

[Dominic Chu]

In fact, some states don't even charge sales tax. I used to live in one of them. I used to live in New Hampshire. It was live free or die. You didn't pay sales tax. But how exactly then do investors kind of understand the differences in how these bonds function and what jurisdictions are the most effective in?

[Dom Chu]

Yeah, there's five states. You listed one of them with New Hampshire, Delaware, Oregon, also Montana. None of these have sales taxes. And so you have anywhere from 0% sales taxes to 6% and above. And what we find is if you have a state that doesn't have an income tax like Florida, like Tennessee, you tend to be in that bucket of the 6% and higher sales taxes. So. So for states, we see that they generally try to leverage these for infrastructure projects. We tend to see about a 7.5% rate when you take the sales tax for states and local governments together. But they're just really important for those states, especially that don't have income taxes to use them to leverage for other purposes to keep government running.

[Dominic Chu]

And how exactly as a portfolio manager, do you go about picking these sales tax type bonds for a portfolio?

[Dom Chu]

Yeah, they're yielding a lot more than your general obligation bonds. But we look for primarily three things. One, from a legal perspective, we look for minimum debt service coverage to make sure that there's enough sales taxes to cover principal and interest when due and also to make sure that municipalities aren't over leveraging this with additional bonds test, we look at resilience. So we'll look back to how these bonds did during COVID how the bonds did during the gfc. And then we'll also look as well as to how broad the tax pledge is. So if you have a state that has every single service, every single point of sale taxed, it's a much broader tax and those are a lot safer versus narrow taxes. Like in Ohio, there's a state liquor tax and that liquor tax is very narrow. So we need more Ohio over collateralization to really account for the greater variability.

[Dominic Chu]

All right. General obligation and taxing authorities. Dan Close at Nuveen, thank you very much. We appreciate the conversation.

[Dom Chu]

Thank you so much, Dan.

[Dominic Chu]

All right. That's it for us right now. Let's check out what's happening with the markets overall because again, hovering right near session highs with the tech heavy Nasdaq up about 2.5%. Dow Industrials up one half of 1% in the S&P 500 at 6707. That's a 1.5% gain. That does it for us here on the Exchange. Power Lunch with Brian Sullivan starts right now.

[Victoria Green]

You've been listening to the Exchange. Make sure you're subscribed to get each.

[Deirdre Bosa]

Episode every day, same time, same place.

[Dominic Chu]

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