US Stocks Close Higher on Chip Rally — Closing Bell

[00:00:00] Speaker 1: AND RIGHT NOW WE ARE TWO MINUTES AWAY FROM THE END OF THE TRADING DAY. ROMAIN BOSTIK ALONGSIDE KATIE GREYFEL TAKING YOU THROUGH TO THAT CLOSING BELL. IT'S A GLOBAL SIMULCAST. CAROL MASTER, TIM STANOVIC, THEY JOIN US NOW. WELCOME TO OUR AUDIENCES ACROSS ALL OF OUR BLOOMBERG PLATFORMS, TELEVISION, RADIO, OUR PARTNERSHIP WITH YOUTUBE, WITH ALL OF THE MAJOR U.S. INDICES SOLUELY IN [00:00:24] Speaker 2: THE GREEN, THE S&P UP 1%, NASDAQ INDICES, CAROL MASTER UP ABOUT 2%. THANK YOU, SEMICONDUCTORS. EVERY NAME, THE 30 NAMES IN THE PHILADELPHIA SEMICONDUCTOR INDEX, 30 OF THEM, THEY ARE ALL HIGHER IN TODAY'S SESSION. [00:00:36] Speaker 1: WHICH ONE IS YOUR FAVORITE? [00:00:37] Speaker 2: OH, THAT'S A GOOD ONE. I LIKE TSM. JUST LOVE THEM ALL. I LIKE, YOU KNOW ME, I USED TO TALK ABOUT THE -- [00:00:42] Speaker 3: SHE LOVES ALL HER SOCKS. [00:00:43] Speaker 2: NAMES IN CHINA, YOU KNOW, I DO. I DON'T HAVE A FAVORITE. ALSO HIGHER? BUT I DO LIKE TSMC. [00:00:50] Speaker 3: ALSO HIGHER TODAY IS OIL. BRENT UP $91 A BARREL, UP ANOTHER $2.20. $85, ROUGHLY FOR WTI FUTURES. YOU WOULDN'T KNOW IT FROM LOOKING AT THE EQUITY MARKET. [00:01:05] Speaker 4: WE'VE BEEN TALKING ABOUT THAT ON THE CLOSE, THE SORT OF DISCONNECT THAT WE ARE SEEING. YOU DO SEE THAT A LITTLE BIT WHEN YOU TAKE A LOOK AT THE BOND MARKET, 10-YEAR YIELDS BACK ABOVE 460. IT'S GOING TO BE INTERESTING TO SEE HOW LONG WE CAN SORT OF SEE THAT DISCOORDINANCE AMONG THESE ASSET CLASSES. [00:01:21] Speaker 1: IT GETS TO THIS IDEA OF WHAT TYPE OF DISPERSION WE COULD POTENTIALLY SEE IN THIS EARNINGS SEASON BECAUSE OF ALL OF THE FACTORS SORT OF AT PLAY, INCLUDING SOME OF THE GEOPOLITICAL FACTORS THAT HAVE DRIVEN A LOT OF CONCERNS ABOUT INFLATION AND WHETHER THAT INFLATION PERSISTS. RELATIVELY LIGHT, OUR EARNINGS AFTERNOON HERE. WE ARE EXPECTING A COUPLE OUT OF THE INSURANCE COMPANY CHARGE AS WELL AS CREDIT CAR COMPANY CAPITAL ONE. MEANWHILE, THE CLOSING BELL IN NEW YORK HAS GREEN ACROSS THE SCREEN FOR THE MOST PART WITH THE DOW JONES INDUSTRIAL AVERAGE ADDING ALMOST 400 POINTS ON THE DAY OR ABOUT 7/10 OF 1%. THE S&P 500 UP ABOUT 66 POINTS OR 9/10 OF 1%. THE NASDAQ COMPOSITE UP 1.3%. THE NASDAQ 100 UP 1.9% AND THE RUSSELL 2000, THE SMALL CAPS CAROL MASTER ADDING ABOUT 45 POINTS OR 1.5%. [00:02:09] Speaker 2: I GO BACK TO THE S&P 500, 230 NAMES GAINING ON THIS TUESDAY. KATIE GOT 271 TO THE DOWNSIDE AND TWO UNCHANGED. [00:02:17] Speaker 4: A LOT OF BREATH WHEN IT COMES TO THE CIRCLE HERE, WHICH MEASURES THE SECTORS. NINE SECTORS FINISHING IN POSITIVE TERRITORY LED BY INFORMATION TECHNOLOGY HIGHER BY 2.4%. THAT'S THE BIG GREEN SLICE ON YOUR SCREEN THERE. ENERGY ALSO HAVING A GREAT DAY AS WE WERE TALKING ABOUT HEALTH CARE TO RISING BY ABOUT A 6/10 OF A PERCENT. MEANWHILE, TAKE A LOOK AT WHAT DIDN'T PERFORM TODAY, RELATIVELY SMALL SECTORS WITHIN THE WEIGHTING OF THE INDEX. IT TRIBBLES DOWN BY ABOUT 1%. COMMUNICATION SERVICE IS NOT TOO FAR BEHIND, CAROL. [00:02:50] Speaker 2: LET'S GO TO SOME INDIVIDUAL GAINERS. LET'S TALK ABOUT SPACEX. AT ITS HIGH, UP MORE THAN 8% INTRADAY TODAY, BUT FINISHING WITH ABOUT A 3% GAIN HERE AT THE CLOSE ON THIS TUESDAY. MACQUARY COMING OUT SAYING, HEY, THE STOCK'S PULLBACK OFFERS INVESTORS A COMPELLING ENTRY POINT TO BUY AT A DISCOUNT. STOCK DOWN ALMOST 40% FROM ITS HIGH ON JUNE 16TH. THAT WAS AFTER THREE DAYS OF TRADING FROM ITS IPO. MEANTIME, I JUST WANT TO THROW THIS STORY IN, TOO. SPACEX HAS SET THE STAGE FOR ONE OF THE LARGEST SHARE UNLOCKS IN CAPITAL MARKET HISTORY WITH AS MUCH AS $116 BILLION WORTH OF STOCK BECOMING ELIGIBLE FOR SALE FOR THE FIRST TIME NEXT MONTH. THAT'S ON AUGUST 6TH. THAT'S TWO DAYS AFTER THE COMPANY DOES ITS FIRST QUARTERLY EARNING. SO WE'LL BE WATCHING. BUT NONETHELESS, INVESTORS BUYING IN TODAY'S SESSION TODAY. UTS BRANDS, LET'S GO THERE. INTERESTING NAME HERE TODAY. THIS ONE UP 88%, ALMOST 89%. COMPANY AGREED TO BE TAKEN PRIVATE IN A $2.9 BILLION DEAL WITH INTERSNACK GROUP GIVING INTERSNACK ITS FIRST FOOTHOLD IN THE U.S. MARKET, ACQUIRING ALL OF UTS CLASS 8 SHARES FOR $14.25 EACH. STOCK CLOSED AT JUST A LITTLE BIT OVER $14 A SHARE TODAY. DEAL EXPECTED TO CLOSE IN THE FOURTH QUARTER AND WILL BE FINANCED BY CASH FROM INTERSNACK AS WELL AS A TERM LOAN AND ASSET-BASED LENDING FACILITIES. WHAT? [00:04:10] Speaker 3: WHAT'S YOUR FAVORITE UTS PRODUCT? [00:04:13] Speaker 2: POTATO CHIPS? [00:04:14] Speaker 3: YEAH. [00:04:15] Speaker 2: YOU MEAN VERSUS PRETZELS? YEAH. [00:04:17] Speaker 3: THEY HAVE SO MANY DIFFERENT BRANDS, INCLUDING TIM'S CASCADE SNACKS. [00:04:21] Speaker 2: WHICH ONE IS YOUR FAVORITE? [00:04:22] Speaker 3: I LIKE TIM'S. [00:04:23] Speaker 2: SHOCKER. SIMPLE. ALL RIGHT. GENERAL MOTORS, I JUST WANT TO THROW THAT INTO THE MIX IF I MAY. GM UP ALMOST 5% HERE AT THE CLOSE. THIS IS AFTER THE COMPANY RAISED ITS FULL-YEAR PROFIT FORECAST BY ANOTHER 500 MILLION AFTER BEATING SECOND QUARTER EARNINGS ESTIMATES POWERED BY STRONGER MARGINS ON ITS LARGEST VEHICLES AND LOWER TARIFF COSTS. THEY DID LOWER THEIR EXPECTED NET INCOME BY AT LEAST 1.5 BILLION TO A RANGE OF 9.9 BILLION TO 11.4 DUE TO ELECTRIC VEHICLE-RELATED CHARGES, BUT THEY DON'T EXPECT FURTHER LARGE WRITE-DOWNS ON EVS AND BATTERIES BECAUSE THEY'VE ALL KIND OF WRITTEN DOWN A LOT ALREADY. [00:04:59] Speaker 3: THOSE ARE SOME GAINERS. LET'S TALK ABOUT SOME DECLINERS TODAY, INCLUDING THE WORST PERFORMER IN THE S&P 500, DONNA HERCORP, DOWN 11% TODAY. THIS WAS ITS WORST DAY GOING BACK TO SEPTEMBER OF 1991. AND AT ONE POINT, IT WAS THE WORST DAY SINCE OCTOBER 19, 1987, WHICH WE ALL KNOW. [00:05:19] Speaker 2: WHERE WERE YOU IN 87? [00:05:20] Speaker 3: I WAS IN THE TRI-STATE AREA. WERE YOU? YEAH, I WAS. THAT WAS BLACK MONDAY. I WAS DOWN IN COLLEGE THEN. THE COMPANY GAVE CORE REVENUE GROWTH OUT GUIDANCE FOR THE THIRD QUARTER THAT FELL SHORT OF THE AVERAGE ANALIST ESTIMATES. WE ALSO ACTUALLY SAW LIFE SCIENCES STOCKS, OTHER LIFE SCIENCES STOCKS TAKE A HIT AS A RESULT OF THIS REPORT. ALSO, CHARLES SCHWAB FELL TODAY, DESPITE THE FACT THAT EARNINGS TOPPED ESTIMATES, RETAIL INVESTORS CONTINUE TO JUMP IN AND OUT OF THE MARKET. THE VOLATILITY SPARKED BY GEOPOLITICAL UNCERTAINTY WAS A BOOM FOR THE COMPANY. SHARES FELL BY 2.5%. THEY WERE UP FOR A PORTION OF THE DAY THEN FELL A LITTLE EARLIER THIS AFTERNOON. WE SPOKE TO RICK WORSTER, THE PRESIDENT AND CEO OF CHARLES SCHWAB A LITTLE EARLIER ON OUR PROGRAM. HE SAID THAT THE PLATFORM, THE TRADING PLATFORM SAW 3.5 TIMES MORE VOLUME ON DOWN DAYS IN THE MARKET, MEANING THE CLIENTS ARE BUYING THE DIP. HE SAID GEOPOLITICAL RISK IN THE MARKETS, THEY'RE MORE ACTIVELY TRADING. HE SEES MORE FREQUENT TRADING, BUT THE SIZE OF THE TRADES ARE OFTEN SMALLER. INTERESTING. YEAH. [00:06:19] Speaker 5: I LISTENED TO THAT INTERVIEW. SORRY? I LISTENED TO THAT INTERVIEW. OH, THANK YOU FOR TUNING IN. I DID, YEAH. [00:06:24] Speaker 2: AND YOU LOVED IT, RIGHT? AND YOU WERE TAKING NOTES. OH, THAT'S HOW YOU DO A GOOD ANE REVIEW. IS THAT WHAT HAPPENED? [00:06:30] Speaker 1: YEAH, YEAH. I MEAN, YOU LET HIM OFF THE HOOK ON A COUPLE OF QUESTIONS THERE. OKAY. BUT OTHER THAN THAT, YEAH, IT WAS FINE. [00:06:35] Speaker 3: YEAH, THANK YOU. THANK YOU FOR YOUR FEEDBACK. [00:06:37] Speaker 2: I'LL GET THE MANAGER FOR YOU. WHERE WERE YOU YESTERDAY, BY THE WAY? ME? I WAS AROUND. YEAH, I SAID AROUND, BUT YOU DIDN'T -- [00:06:42] Speaker 3: YOU SEEM A YEAR WISER, ROMAIN, THAN YOU DID YESTERDAY. [00:06:47] Speaker 2: WAS IT YOUR BIRTHDAY YESTERDAY? NO. [00:06:49] Speaker 1: OH. HMM. IT WASN'T? [00:06:52] Speaker 4: NO, I DON'T WANT TO BLOW UP A SPOT. YOU ANCHOR TEAMS. YOU STICK TOGETHER. [00:07:01] Speaker 3: YOU ONLY GOT A COUPLE MORE DAYS. I KNOW. [00:07:03] Speaker 1: YOU CARE ABOUT YIELDS AT ALL? I CARE A LITTLE BIT ABOUT YIELDS. [00:07:06] Speaker 4: WHAT HAPPENS? [00:07:07] Speaker 1: SHORT-TERM YIELDS UP FOR A FOURTH STRAIGHT SESSION. IN FACT, UP ABOUT 13 BASIS POINTS ON THE TWO-YEAR YIELD. OVER THAT STRETCH HERE, AS A LOT OF PEOPLE NOW START TO PRICE BACK IN SOME OF THE INFLATIONARY PRESSURES AND I GUESS THE POTENTIAL MAYBE THAT THE FED COULD RAISE RATES. OBVIOUSLY, THERE'S A PRETTY DIRECT CORRELATION HERE BETWEEN THAT RISE IN YIELDS, A SELL-OFF IN THE TREASURY MARKET AND WHAT WE'RE SEEING WITH REGARDS TO THE REBOUND, CAROL, IN OIL PRICES. [00:07:28] Speaker 2: QUICKLY, CAPITAL ONE FINANCIAL JUST CROSSING THE BLOOMBERG TERM. LET'S GO TO THE NUMBERS. SECOND QUARTER NET REVENUE, FOLKS, UP 27% YEAR-OVER-YEAR, 15.9 BILLION NET CHARGE-OFFS, 3.6 BILLION, THAT'S EXACTLY WHAT THE STREET WAS FORECASTING. SECOND QUARTER ADJUSTED EPS, $5.81 VERSUS 5.48 YEAR-OVER-YEAR. AND WE'RE LOOKING AT THE STOCK, MAYBE WE CAN BRING IT UP HERE. JUST REAL QUICKLY, I'M GOING TO BRING IT UP HERE. I'M LOOKING FOR IT. IT IS UP 1.1%. [00:08:04] Speaker 1: I ALSO JUST WANT TO BRING IN SUPER MICRO HERE. IT LOOKS LIKE THEY'RE JUST PROVIDING A BIT OF A BUSINESS UPDATE, CROSSING THE WIRE RIGHT NOW. ON THEIR REVENUE FOR THE FOURTH QUARTER, THE FISCAL FOURTH QUARTER, THE COMPANY SAYS IT WILL BE AT THE LOW END OF THEIR PREVIOUS RANGE OF $11 TO $12.5 BILLION. BASICALLY, THE LOW END OF GUIDANCE GROSS MARGIN WILL NOW SAYING THAT IT IS BACKLOGED FOR THE FOURTH QUARTER. THAT IS VERSUS PREVIOUS GUIDANCE OF 8.2% TO 8.4%. BASICALLY, REVENUE AT THE LOW END OF THE GUIDANCE GROSS MARGIN RECORDS IN THE BUSINESS STOCKS. THE BUSINESS STOCKS HAS A RECORD WITH NEW ORDERS TOPPING $60 BILLION. THIS IS EFFECTIVELY A BUILDER OF DATA CENTERS, RENTING OUT THE SERVERS FOR OTHER FOLKS. IT RAN INTO SOME ISSUES IN THE PAST WITH REGARD TO ACCOUNTING [00:08:53] Speaker 3: ISSUES AND WHETHER OR NOT IT CAN GET ITSELF BACK ON TRACK. THE BUSINESS STOCKS IN RECENT YEARS, IN 2023, UP ABOUT 250%. IT DID RISE TODAY ALONG WITH ALL THE CHIP STOCKS. IT WAS UP TODAY ABOUT 7% AND IT IS ADDING TO THAT IN THE AFTER [00:09:09] Speaker 4: HOURS, UP ABOUT 6% IN THE AFTER HOURS. THANK YOU SO MUCH. I'VE BEEN TALKING ABOUT AN UPDATE COMING FROM SUPERMICRO. THEY WERE SCHEDULED TO REPORT THEIR EARNINGS ON AUGUST 5. SO NOT TOO FAR FROM NOW, BUT THE COMPANY MAKING THE DECISION, I GUESS, TO PUT SOME GOOD NEWS OUT THERE IN THE MARKET. THEY DID RISE TODAY WITH A LOT OF THE OTHER SORT OF CHIP AI NAMES. BUT I WILL NOTE THAT PRIOR TO THAT, THEY HAD CLOSED OUT SIX STRAIGHT DAYS OF LOSSES ON THE STOCK, WHICH HAD BEEN THEIR LONGEST STREAK SINCE MARCH 2025. THEY WERE TALKING ABOUT SIX STREAKS, BUT THAT IS A LITTLE [00:09:42] Speaker 1: HIGHER BY MORE THAN 11%. WE SHOULD POINT OUT, JUST IN REGARD TO THAT SHARE PERFORMANCE, WE TALK ABOUT, GO BACK TO THAT LAST EARNINGS REPORT, WHAT YOU DID SEE ABOUT A POP IN THE SHARES, LIKE A 25% RALLY THAT DAY, BUT BY THE TIME YOU GOT TO THE BEGINNING OF JUNE, THAT BEGAN TO SELL OFF AS A LOT OF THOSE CONCERNS SET BACK IN. [00:10:01] Speaker 2: THOSE SHARES HEADING INTO TODAY WERE DOWN ABOUT 50% SINCE THE START OF JUNE? YEAH, AND DOWN 13% YEAR-TO-DATE, BUT IT DOESN'T REFLECT CERTAINLY THE BIG PULLBACK THAT WE'VE SEEN. CERTAINLY THAT NEGATIVE SENTIMENT CONTINUING. ALL RIGHT, FOLKS, BUT IT IS UP. SUPER MICRO RIGHT NOW UP ABOUT 13% IN THE AFTER MARKET.