exposed those. mgm communications were affected. the criminals didn't hack in. they were let in by a human being by social engineering. criminals targeting an employee either at the company or third-party vendors. it's a casino heist. >> are these casinos insured against the losses? >> they are. it will come in and cyber insurance pays a big part of ransom. >> thanks, contessa. >> that's why the cost of cyber insurance keeps going up. "closing bell" starts right now. welcome to "closing bell." i'm scott wapner live from post nine at the new york stock exchange. this make or break hour begins with the resilient stock market how even one of the greatest investors says he's a bit surprised at how well equities have done this year. we'll get to those comments and others from sid ta dell's ken griffin in a moment. a nice broad move.

there it is, all three of the major averages plus the russell seeing nice gains. retail sales coming in better than expected as well. which is likely one of the reasons interest rates have been creeping up across the curve throughout the day. there's your picture. it's green across the board. jpmorgan and goldman sachs helping lead the dow higher today. along with several big industrial stocks like caterpillar and dow. we're closely watching the nasdaq today as well. arm's highly anticipated ipo off and running at a big way. priced at 51, opened above 56 and it's above 58, near 15% to gain on today. we'll discuss whether the biggest ipo of the year is a sign the market is thawing out. it does take us to our talk of the tape today. the market's unique ability to brush off almost anything thrown its way and how long that can last. let's ask gabriela santos,

jpmorgan's global market strategist and cnbc contributor joe terranova, of vertis investment partners with me at post nine. it is a resilient market, is it not? >> it is quite resilient. through the end of may it was about the a.i. turbo charge of a handful of companies. since may more participation from cyclicals as the data has shifted the narrative, much more towards a soft landing. it has been surprising even though we've seen a back up in real rates closs to 200 basis points we haven't seen a bigger correction in long duration stocks. we've seen some, but we haven't seen as big of a correction as we would have expected, given naturally would lead to more of a focus on valuations and we know the largest of those stocks are quite extended when it comes to valuations. >> yeah it's been a surprise to many, not least of which ken griffin of citadel on earlier today here's ken on the resiliency in the market.

it's been a really good year for the market, particularly with the backdrop of higher real interest rates. when look at the yield on the 10-year bond, the real yield, for example, in the 5-year tips bonds, we've seen, again, an increase in real rates and nominal rates and yet the stock market has been resilient. that's a really interesting year to see the resiliency of our stock market against this backdrop that would be very challenging for equities. >> all right. that's ken griffin. why hasn't it been more challenging? >> you want to put a bull market in context and understand the fundamental catalyst behind it. i want go back to august 18th, the s&p 4335. we're up 4% since then. let's remind ourselves what this bull market has had to overcome since august 18th. we heard ate at the end of

august that nvidia and the price action that day was inducktive of an inflection point for the market. the price of oil on august 24th was $77.50. it's above $90 today. we got through unemployment. we got through cpi. we got through retail sales. and we are coming up towards the end of the quarter ahead of an earnings reporting season. normally what happens. we see earnings estimates lowered towards the end of the quarter, ahead of the earnings. in fact, what's happened? earnings estimates for technology has moved higher by 7%. the revisions are actually positive. so you tell me, if you are bearish and of the belief this market is going to roll over significantly, it's going to give in to the overwhelming force from treasury yields what, in fact, is going to be the catalyst? we've overcome all the catalysts that were supposed to in a

seasonally weak period defeat that bull trend. >> that's why ken griffin among others are somewhat surprised, gabriela, why we've been able to overcome all of that. the question i asked joe, i'll ask you, why? why has the market been able to look past, you know, most of what has come its way and that's why we sit here 45, north of 4500 on the s&p 500? >> i do think this earnings piece is so key because we talked about for the first six months of the year how it was all about multiple expansion. what's happened since the end of may is not just that macro data has been better than expected, but also, earnings have been better than expected. so since then we've had an upward revision in the next 12 month earnings of 4 percentage points. it's more about favorable fundamentals rather than just pure valuations alone. with that said, we do think it is surprising that valuations,

quality, dividends, your traditional factors that would do well when you have the positive high real rates haven't been doing as well and that's something we think will change. we're bullish on the market. it's how you invest is more nuanced. >> not like mr. griffin thinks we've gotten this far and the market proves resilience. the dow is near 400 points to the upside at the highs of the day. you know, he still looks at this market, and it makes him a little uneasy where we are now. listen. >> i'm a bit anxious this rally can continue. obviously, one of the big drivers of the rally has been the just frenzy over generative a.i. which has powered many of the big tech stocks. i like to believe that this rally has legs. i'm a bit anxious for we're sort of in the seventh or eighth

inning of this rally. >> he points to froth in nvidia even though he likes it and says the management team has executed to a t. the other issue he talked about was the prospect of higher real yields given where the deficit is, supply of treasury on the market, this overwhelming supply who the buyers might be and the fact that it causes a push higher in yields. that's on his radar and others that i've spoken to recently as well. >> i don't disagree with that and the market has been anxious since november of 2021 when federal reserve chairman jay powell indicated that monetary policy was going to normalize and certainly it intensified through the better part of 2022. you asked before the reason why the market has been resilient. you have to focus on the what. the what is what's going to be so critical as we move into the fourth quarter. the what to me is that absolutely this bull market has legs and quite candidly, understanding what i understand about the composition of this

rally, we know full well the overwhelming majority of money managers who are behind the daily price movements are under performing. if, in fact, over the next several weeks there's not the injection of bearish conditions that will defeat this bullish trend this market is going to go significantly higher. >> that will happen, we think that will happen, as long as earnings don't disappoint us, right. we have gone from three quarters in a row of negative earnings growth. this is supposed to be the quarter where we start ticking up and then the fourth quarter is better and then we start thinking towards '24 when it's starting to improve. headwinds, oil prices, watching that a lot. highest level of the year. we're above $90. show oil. that's where we are. how should we put all of that into perspective as well? >> i think what gave us a lot of comfort was the second quarter earnings season was negative,

but that was largely almost due to energy materials on a year oifr year basis. if you subtract energy and materials earnings grew in the second quarter. that was a bits of a relief to say that look, regardless of what happens with the macro economy the earnings recession seems to be behind us and seems to have been so much milder than we expected. remember, we used to talk about the possibility of an earnings contraction of 15, 20%. seems like it was only 4%. so companies being able to manage their margins and the top line not declining as much as expected. of course, it will come back to earnings. i think the real rates s discussion is nuanced in the sense that real rates are 200 basis points right now. there's skepticism that's actually the new reality. it seems to us that something closer to 50 to 100 basis points is more realistic.

things haven't changed that much. next week's fed meeting will be key to watch in terms of their assessment of this. >> finish with tech. joe, arm ipo so far so good, right, at least it seems to be that way as we watch that stock up 14% as, you know, it prices at 51, gets out of the gates north of 56 and here you go where it is now. adobe in overtime. you own the snotock. >> oracle not so good. >> what do we look at with arm? >> it doesn't seem like one single technology company and a negative price reaction can defeat the bullish trend. in the instance of arm i always believe that this was priced incredibly well. the demand you knew was going to be strong on the first day given the small float. this is a real company with real earnings and participation in a.i. now, it is richly valued and that's one of the reasons why i won't buy the stock. i can buy broadcom and i own

nvidia. as far as -- >> valuation close to 100 times. in the case of adobe this is a company in the sweet spot right now. is the expectation going into earnings very high? yes. i acknowledge that it is. but traffic, web traffic, has been strong. fire fly is going to be a positive contributor. it's been a stock that has come back like the rest of it can with remarkable resiliency. >> appreciate the conversation very much. gabriela thank you, joe terranova thanks as well. the uaw strike looming this evening. contract talks nearing the deadline. phil lebeau is here with the gm north america president. take it away. >> thank you, scott. mark royce, president of general motors, you just made a fourth offer earlier today to the uaw. talk about this a little bit because a lot of people are saying what is gm bringing to the table? 20% raise over the life of the contract, 4 1/2 years? >> that's correct. if you look at that and some of the spikes that happened from an inflation standpoint we're getting a lot of people into a

great place here for us employee wise. >> you got that, plus for the first time you are basically saying the facilities, the plants that we have, we're going to be -- a that's through the life of this contract. we're not planning to close any of these plants? >> that's job security. that's important to not only our team members and every employee in general motors, but also the communities that these plants and our suppliers are in. you know, that's a big deal because if you have been around in gm, having our plants in our communities fully facility tized with the promise of two more ev investments and a third propulsion ev investment in one of our traditional plants we're doing that. we have vertically integrated that. a lot of our competition hasn't. we chose to do that. use our full footprint and capacity. it's a big deal for us. >> you've heard what shawn fain president of the uaw said it's not enough. are you frustrated?

>> these are never easy negotiations, but i have to tell you, we are 120% at the table bargaining and negotiating the offer that we gave today the subcommittees are doing that right now. this is a true give and take right now. it's happening. one thing i will say, though, you know, july 18th, the day that we got, you know, the first list of the demands and the requests by the uaw leadership and the president, that was when we started and so there were 1,000 things we've been working through until we get to the last pieces and the time deadline that we have tonight. so we've been doing that all the way through in a very, very conscientious and hard effort and result way. >> if the uaw goes on strike at midnight and we've been told it's going to be at least three of your transmission and engine plants plants, how quickly will that take? >> it hurts everybody. it hurts our employees, the

communities where these plants are, our supply bases, tier 1, tier 2, tier 3s and for every one of those people out of work at one of these facilities that we have, there's six other people in the community that are affected. so the buying power in our plants, 2, 3, 4,000, 5,000 people in some cases, the buying power in those communities is really large. the economy, the communities, it's all affected. that would be a very sad, sad outcome. >> when you've gone into some of these negotiations in the sessions has shawn fain been in there and what's your take on how he's conducting himself? >> he has been in there, phil. you know, this has all been in good faith. it has been happening. as i said, i set the record straight on when we started and that was july 18th. >> are you frustrated? >> i don't know if frustrated is the right word. we're intensely focused on getting the agreement. >> one last question. the ripple effect of this. if this is an extended strike over several weeks how damaging

is it? >> if you think about it, again, the communities, the employees, you know, the livelihoods of the families of all of our employees is devastating. so this is something we have made the investments, you know, we spent $5 bi35 billion on the biggest transformation and we're ready to go. the best job security is great products with great people and high quality. we're ready to go. this would put, you know, a tremendous strain on what we have already in place and what we're ready to, cute. mark. >> mark wrois. we're a few hours away from the deadline. 11:59 is when the contract expires. >> this isn't the only big interview. jim farley, the ford ceo coming up in the next hour, right? >> yep. we will be talking with jim, similar tenor in terms of the feelings not only that we heard

from mark, ford, stellantis, there is a feeling we need a deal done and is the uaw ready to negotiate or already decided we're going to call a strike? that's the big question out there. >> good stuff. we look forward to that in overtime. phil lebeau on the case as the deadline looms. we'll see what happens there. a check on some top stocks to watch as we head into the close. kristina partsinevelos is here with that. >> thank you, scott. all those shares of etsy have under performed this year down 41% versus the nasdaq up over 30%. analysts at wolfe believe the online marketplace is under appreciated by investors. they say consumer penetration is still pretty low and should grow over the nextfew years as discretionary spending increases. that's why you're seeing shares up almost 3%. at&t shares also jumping today after the cfo said in an industry conference it that telecon company expects third quarter free cash flow, although this range was expected from analysts and yet the stock is up

about 3% as well. scott? >> we'll see you soon. thank you. kristina partsinevelos. we're just getting started. arm holdings hitting the public market today. we'll show you those shares that had a good day. maybe not the best levels but still a pretty good debut. amy is joining me at post nine. it does bring us to our question of the day. we want to know would you buy shares of arm at the current valuation? it sits about 100 times. head to @cnbc "closing bell" on x to vote. the results later on in the hour. you're watching "closing bell"on cnbc.

. welcome back. arm making its anticipated market debut today. leslie picker is here with the very latest. leslie? >> hey, scott. yeah, it's a seminal moment frlgts ipo market. arm is the first tech ipo of the year, largest in two years and one of the top five u.s. listings in the last decade. and despite its size so far, it's gone pretty smoothly. priced at the high end of the range and then gaining on day one currently up 15%. although there is still another 40 minutes or so to go in trading. now some color on the order book i haven't shared. i'm told there were more than 50 investors comprising a relatively concentrated book of mutual funds, sovereign wealth

funds and hedge funds and then $735 million worth of indications from cornerstone strategic investors such as amd, apple, google, video nvidia and others. arms trading bodes well for the other ipo in the pipeline. instacart, marketing automation platform klavio and birkinstock on deck. as for what it does to pry open the ipo window, that remains to be seen. maybe you want to ask me this question at the same time next week, we may have more data points. it certainly doesn't hurt things. >> no, no. it doesn't. we'll have to see how things transpire, the names on the list you gave us, along with many others, are in the pipeline. you figure waiting for the absolute right moment, whether this brings it or not is anyone's guess, correct? >> that's right. i mean, the unique thing about this deal, this company was founded, arm was founded in 1990, so it's an older company. it's an established company.

it was solely owned by softbank. it's not one of those venture capital backed companies waiting in the wings and not profitable and looking at total addressable market in the future. this susisn't that kind of an i in 2021 during the last peak. it's older, not even growing, it's shrinking its top and bottom line, although they have new markets those in a.i. they've been marketing to investors, so, you know, you kind of take this one in a category of its own. it will be interesting to see with the deals next week that are more venture backed and more in that category we're used to tech ipos. >> maybe a better barometer. that's leslie picker covering arm all day for us. let's bring in amy for a look at how she's playing the ipo markets. >> hi, scott. >> do you agree this is more of an idiosyncratic case than a sign of a true thaw of the tech

ipo market? >> yeah. we do need to watch the market. this is a big milestone. it's one of the largest as we've heard. at the end of the day, we're watching for two things. one is how its debuted and so far it's respectable, not a moonshot, but how sustainable is that? we can recall in 2021 when facebook ipo'ed. it was a bit of a bummer. at the end of the day when that happened it put a dampening effect on the market. >> are you a buyer? >> no. we are not a buyer. we claim a.i. in different ways. >> valuation too rich? we mentioned it's ate 100 times, maybe too rich for some including yourself? >> valuation is a little bit higher for us. the growth prospects of this company have not been as attractive. >> you mentioned you're playing it other ways. is that code for we like nvidia the best of all in a.i.? >> we like nvidia but not at

these valuations. there's a couple ways to play. the hyper scale cloud vendors which we, obviously, own microsoft and amazon and google. there are strategic consultants like accenture. adobe that just went public with their firefly pricing and that's an interesting play for us as well. there are a couple ways we're playing the a.i. mega trend. >> want to go back to the comment that you made about nvidia, maybe too rich where it currently is. the valuation has come down over the last several months has the guidance have gone up and earnings have been good. it's an interesting perspective that you have that you still think it's over valued. i bring it up, ken griffin on citadel likes it too used the word frothy. the valuation has come down and you think it's too pricey? >> there's a part science. from a valuation standpoint, the price to earnings and other metrics that we're looking at is on the higher end when you compare it to the broader market

or other f.a.a.n.g. stocks. we're seeing a little bit of, to your point, froth in terms of momentum building up. a lot of expectations in terms of what they expect from a revenue standpoint. yes, they have fulfilled their revenue guidance for the past quarter, but that's one quarter of a data point. we want to see a longer term trend. >> you're looking at nvidia, the forward p/e is a different story. what about mega cap valuation overall? how should we view that in the here and now as a group? >> we've been a little bit relieved in terms of seeing the sell-off if you would back in august into september. going into this technology rally it's a sign. we are not adding new money into the markets price to earnings perspective it's on the higher end relative to the market and historical averages as well. >> how are you viewing the market overall? we mentioned at the top of the program this really unique and incredible resiliency in most cases that the market has shown,

enough that, you know, griffin surprised by it, i think many are. >> the data continues to be conflicting and i agree with you. on the one hand leading indicators that suggest that market rather the economy should be in a recession already, but at the same time the consumer has held up quite nicely. so we are not yet in the camp of saying a recession is out of the cards and we're playing it conservatively. we have fuller positions in tech but cutting back a little bit. >> where have you been going elsewhere if you're moving away from tech? do you believe in catch up trades or things like energy or sectors that haven't performed all that well this year? >> we're looking at energy as a sector and perhaps may nibble at that. we're staying with companies that can benefit from shorter and longer term trends. longer term we talked about a.i., but shorter testimony what could benefit. private lenning is one area we like a lot and we'll stick with that.

valuations are certainly less -- >> the noise can be distracting. we forgive you. i'm turning up the volume as we speak. >> the valuations with private lenders plus the dividend yield are more attractive to us. >> do you think the fed is done? >> we're not sure yet. obviously, you've got data like cpi suggesting that they probably could raise again. i think that's a toss up now. september is probably a pause from our perspective. >> appreciate you being here very much. joining us at post nine. the case for caution, rich saperstein has been cautious on the market and now raising the red flag again on some big market headwinds that could impact your money. he explains after the break. do not forget please register for cnbc's delivering alpha conference. i'll be there with can't miss interviews including bill ackman on september 28th in new york city. qr code on the screen. get your tickets. "closing bell" right back.

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welcome back. maj averages raleigh with t-- major averages rallying. our next guest staying cautious and thinks the market is optimistic on the road ahead. let's bring in rich saperstein, back with me at post nine. the more things change the more they stay the same. what i think of when i see you and read intros like that. you're still cautious on a market that's proven, as we said at the outset, to be darn resilient? >> at the peak of our cautiousness we trim by 10% and kept all of our large tech holdings, and we now are back at full allocations with the market appreciation it. we're able to use that capital to redeploy into 4% tax-free muni bonds, which is an outstanding opportunity for our clients. >> you still think that opportunities outside of equities provide the best risk-reward for you and your

clients? >> yeah. at this time we think there's great opportunity in a bond market which was uninvestable for roughly 15 years and clients that had a large equity positions that built up over the years. it's time to trim them and reallocate into other alternatives. >> this notion that ken griffin posed at the top, surprised you could tell by the level of resiliency that this market has put forward, even in the face of all of these headwinds that people like you look at and say gosh, i don't want to be overly exposed to equities. yet, here we are. >> super impressed with the resiliency in the economy because of a couple reasons. labor hoarding. two, you've got the excess savings post-covid being burned off by consumers. three, you have the suppression of the student loan repayments. and a lot of that is reversing right now. we'll have qt added to that mix and a situation where the bite of fed tightening still has to take place. >> so i mean, at what point do

you change your view? you know, earnings expectations are up. if that remains the case, that they, you know, earnings meet the moment and expectations, and inflation, though, sticky in certain areas, particularly related to services continues to come down, what is it out there that causes somebody like you to change your view? >> right now the market is pricing in a let's call it a bullish slowdown where it's tepid slowdown in economic activity. >> a soft landing. >> plus declining inflation and then a fed that cuts and next year an a.i. fueled rise in the equity markets. i just don't think that the pieces will fall into place like that. >> which part? that doesn't seem like far fetched at this point. >> the s&p generated $96 in earnings in the first two quarters. the estimate for this year is 222. so we need to have a $126 in

earnings in the next two quarters, 12% sequential growth. now, i don't see that happening. then in '24 we need another 12% to get to $248. i think the market is pricing in excessive earnings growth relative to where, you know, they're going to come in. >> okay. so you think the market is over valued. is that fair? >> it's hard to talk about an over valued market because tech has had a he profound impact, specifically a decade ago, apple and microsoft were 5.5% of the index. today, 13.7%. so that's driven the average multiples higher. >> that's right. >> so i don't look at the multiple. i'm looking at the economic out outlook and what i have the opportunity to do is invest past the fed tightening, all this nonsense about is inflation coming down or not. there's a wide range of asset classes i could choose from and that's what we're doing. >> i know. i sort of ask you that as i'm

thinking about your allocation. you didn't reduce any of your holdings in mega cap. >> no. >> you have a broadly negative view of the market, but in some respects you're justifying what some would call inflated valuations of mega cap. >> so mega cap has great benefits, recurring revenues, a large moat around their business. google, roughly $90 billion in revenues in operating cash flow. $30 billion a year in capex and r&d. that's not on the balance sheet. five years over $100 billion in r&d that's been spent we have yet to see the benefit of. i think these stocks are very attractive, the ones we own, apple, microsoft, and google, and that they're going to probably go higher over time. now we also are long a lot of oil stocks. we think oil is a great sector to be in right now and have been all year. >> and you have no desire to increase your weightings in -- i

mean what weighting does tech have right now in terms of your investments? >> probably double what we should be. >> i don't know. you made the most bullish case for someone negative of the overall market. >> you talked up muni bonds as we started out. >> if we were negative we wouldn't have a full allocation in equities. we're cautious. we trimmed 10% at the peak of our caution. keep in mind, for our clients, the return to the capital is more important than the return on the capital. so we get to choose where we're going. we don't have to swing at every pitch. >> what do you make of what griffin said. i've been playing a bunch because it's interesting and he's not the only one talking about the possibility of real yields, really, you know, spiking higher because of where the deficit is, the amount of issuance coming on the market too much supply than the market can bear, if the buyers aren't

there to soak it all up. >> yeah. look, that's a really good point because there's two factors here as we evaluate it. one is, higher rates lead to a slowdown, ultimately lower interest rates. that is conflicted with the increased supply that the treasury has to issue to fund this $1.6 trillion deficit. so that is in conflict. but in the end, we're still buying longer term bonds. we think in the long run, the market will appreciate the bonds will appreciate in a slowing economy. >> what's the most recent stock you bought? something jump out to you that you can let us know? >> yeah. so we've added to chevron, occi, home depot. we're looking at adding to rockwell right now. there's a lot of names we've been adding to within our existing portfolio. >> you mentioned energy. why depot? that's interesting to me. >> that's an interesting environment where home ownership

right now is kind of frozen. if you have a 3% mortgage you're going to do home improvements. we think as it an interesting space to be in right now given the constriction in the housing market. >> interesting stuff. enjoyed it as always. >> that's rich saperstein joining us right here, treasury partners, chief investment officer. we're tracking the biggest movers as we head into the close. kristina partsinevelos is back with that. >> aging boomers means cruises will be the it thing to do plus visa wants to change its chair structure and investors don't like it. i'll explain next. (sirens) [due at target in 5!] copy that. make a hard left down the alley. network's got you covered. [please confirm requesting back-up.]

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we're about 15 minutes away from the closing bell. let's get to kristina partsinevelos with the stocks watching. >> visa shares falling lower after announcing plans to change its structure. b shares held by u.s. banks and c shares by foreign banks. visa wants to allow the u.s. banks to exchange class b shares which don't trade publicly into class a shares which means more class a, more dilution. you're seeing shares down 2%. americans are still itching to travel and analysts at red burn believe the cruise lines stand to benefit for strong demand and upgraded norwegian and carnival to buy, royal caribbean at neutral. age is a factor. the average guest is over 50

years old and with the over 65 population set to go 2% per year until the end of the decade there's a jump in demand. right, scott? you should know. >> sure. kristina, thanks. >> sorry. >> kristina partsinevelos. all right. as we head out, let's show you arm holdings. highs in the session up near 20%. we'll watch that over the final tr stretch here. s it's your last chance to weigh in on our question of the day. head to @cnbcclosingbell. results are after this break. are needed most. drawing on deep expertise across the world's public and private markets in pursuit of long-term returns... pgim. our investments shape tomorrow today.

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we asked would you buy shares of arm at the current valuation of p/e about 100. majority said no. almost 85% in fact. thanks for voting. after the break, adobe and leonard reporting in overtime. rweun you through the themes and metrics to watch. that and much more when we take you inside where else, the market zone. the power goes out and we still have wifi to do our homework. and that's a good thing? great in my book! who are you? no power? no problem. introducing storm-ready wifi. now you can stay reliably connected through power outages with unlimited cellular data and up to 4 hours of battery back-up to keep you online. only from xfinity. home of the xfinity 10g network.

power e*trade's award-winning trading app makes trading easier. with its customizable options chain, easy-to-use tools and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are. e*trade from morgan stanley. power e*trade's easy-to-use tools make complex trading less complicated. custom scans help you find new trading opportunities, while an earnings tool helps you plan your trades and stay on top of the market. e*trade from morgan stanley. here we are. we're in the "closing bell" market zone. cnbc markets commentator mike santoli is here to break down the crucial moments of the

trading day. plus, diana olick on lennar earnings out in overtime today and we'll dig into whether adobe could see a sell-off like oracle when it reports within the hour. we're off the highs of the day but we have a good, broad day going. >> yes. pretty reassuring after a couple of wobbly ones. i think that no part of the august and september choppiness has gotten deeper and nastier than routine, but it has gotten a little bit fatigued along the way. right now s&p 500 up 4500 making a run at the september 1st closing high. this is where we're at, which is still knocking around the same zone. the ecb raising today and immediately the markets turn to certainly they're done and price in cuts. i think that reinforces all the data this week, everything that happened, doesn't really disturb the idea of peak central bank, u.s. economy is decelerating but not falling apart.

the earnings picture looks okay. it's a top heavy earnings picture. nasdaq 100 estimates up a lot in the last month. the rest of the market not so much. that reflects how the market has been acting. >> you hear the case from those cautious, if not bearish. rich saperstein makes the case earnings are too optimistic. others who say the cpi and ppi just underscore the point that inflation is sticky and it's come down a lot and quickly but then you'll get a stall. >> no doubt you haven't really proven anything. not achieved anything that's guaranteed. but the s&p is where it was two years ago. earnings are up 10%. same price, 10% higher earnings. nominal gdp still going 5 plus percent. whatever you think about inflation it's 3 plus. real growth is 2%. i don't think you have to really kind of twist yourself up to explain why we're traigts tra -- trading here. the s&p equal weight is dead

flat. eight months of nothing. not as if the market is somehow looking at this unrealistic rosy picture and pricing it in. that's hanging in because the backdrop is not that hostile just yet. >> before i get to diana, saperstein again, it's fascinating to me that a guy can be that cautious on the market, but he's in more than he wants to be on the mega caps. >> right. the market has essentially raised, if you have any equities, it sort of kept you increasing your exposure and then you could figure out what to do with it. bonds at these yields are, you know, essentially allowing you to take equity risk more than you were in the past because you get 5% carry on the cash. >> all right. diana olick, what can we expect from lennar in overtime? >> scott, lennar is the second largest home builder in the nation and it like the other builders has been benefitting from the severe lack of supply on the existing home side so the expectation is for another strong report. now last month berkshire hathaway reported new positions in lennar and two other big

builders investing $800 million. lennar's stock is up about 60% in the last 12 months. demand for housing appears to be strong ap applications for a mortgage to buy a newly built home in august were up 20% year over year according to the nba. in q2, lennar's chairman said buyers were getting used to the new normal in interest rates but rates were below 7%, approaching 6 at one point. then they shot up over 7% in june. we'll see how much that hit demand in q3 and potential sellers for lennar. >> all right. we'll look forward to your reporting in "overtime" when lennar hits the tape. speaking of hitting the tape, adobe also reporting after the bell. days after fellow software company oracle cratered on disappointing guidance. what about now? is this a risk? we watch chips sort of some of the chips starting to pull back. oracle, software, starts to pull

back. we're wondering what's going to happen with adobe. >> could be risk. adobe has outperformed on a year-to-date basis. it was an ultra favorite of the software kind of mini bubble back in 2021, and it got just destroyed off of that. now you've got about doubled off the lows. it's had a decent run. in terms of its valuation, free cash flow yield, 3.5%. that has been essentially just a rock steady level that's more or less stuck to over the last ten years with the exception of 2021 when it got too expensive and last year when it got cheaper. i don't think people are super off sides about it, but what adobe says about the macro stuff, clients doing in terms of budgeting, people have been sensitive to any signals around that in this earnings season, and, obviously, the a.i. story. it's like is it persuasive. how are you getting paid for it. is it a big enough part of the business you want to capitalize the company around that?

>> which reminds you you'll hear from the ceo of adobe as well in "overtime." don't miss that after the numbers hit the tape. we look forward to that. you have options expiration tomorrow. >> explain why that can be volatile. >> seems what it means, this cluster of exposure around certain index levels and sometimes it kind of traps the market. instead of being more volatile leading up to it, once you get to the expectations the market could trade loser. i would point out for the basic disclosure sake, a lot of work about the week after the september options expiration has a history of being pretty weak. everyone knows late september has historically been the scene of a lot of accidents. doesn't mean it has to be or every year when the market is up on a year-to-date basis. maybe the risk is lower. what i find fascinating, volatility index clicking below 13 today.

almost round trip to the multiyear lows before the pandemic. it's because the index itself has been trapped. we were 4500 two months ago. we're at 45 right now. it's been a long time since a 5% pullback from a high on a relative basis. it seems as if the market is pricing in maybe not much of anything happening and i guess you have to ask, does that represent a little bit of near term tactical risk if people have not necessarily got their guard up as much. i guess that being said, you know, yesterday's put call ratio was high. nobody seems to think the market will race away interefrom them. i guess we're stuck in the range type attitude. >> let's touch on arms in the two minutes. you heard the sound effect for the two-minute warning there. biggest ipo of the year, obviously highly anticipated. we can show you a chart as we look at arms in the final stretch. 90 seconds or so. right now it's at the highs of the session up about 25%.

buyers come in right at the end here. there's been some suggestion today it's more idiosyncratic than anything in terms of a tell on the state of the thaw so to speak. >> in terms of arm's specific business it is a special case, so it's not as if its enthusiasm over the chip making process broadly or other design companies. i think the way it's priced and traded is probably the way you hope to have seen it go, meaning you get some upside. 24% is a good run. there's a 10% float. it's not that much stock out there. and this is right around where remember softbank valued when it transferred out of the division fund. it seems like everyone should be happy with this, even if it's not really valued at this price, you know, all that attractively unless you have some great expectations of what's going to happen on the earnings side. i think it's a marker of relative health for the overall capital markets, even if it's not -- doesn't mean anybody can sort of plug in whatever

valuation they want and get out the door because they think there was care taken in pricing it lower than they could have which is prudent given where the market is. >> one of the under writers, goldman having a good day too. look at the second derivative play. pretty good day. that does it for us. stay tuned for adobe and jon's interview with the company's ceo. we'll send it into o.t. right now. >> that is the scorecard on wall street. green across the board. welcome to "closing bell: overtime". morgan brennan is off today. we will get signals from two different parts of the market when software giant adobe and home builder lennar report results. we'll bring you all the numbers and an exclusive interview with adobe's ceo shantanu n