good monday morning. i'm carl quintanilla. the geopolitical and global economic impact of the conflict in israel. y you. resurgence and optimism around private credit. kkr's co-head of credit and markets is here. oakmark out with new picks, new buying opportunities to talk about. bill nygren is going to join us. attacks on israel and the market reaction. let's bring in cnbc senior market commentator mike santoli.

on "squawk box," mohammed el. >> s&p giving back about 40% of the gain from friday. if you look at a long-term chart, it's hard to identify these conflict points as being turning points. that being said, the market is in a rational, localized way, punishing those groups that seem like they're going to be, perhaps, disadvantaged, like the travel related. you get a bit in defense and energy. it's reflex. there's a lot else going on. we kind of had a cushion because oil prices backed off from their highs. treasury yields, they're proxies based on futures and etfs look like they're easing back a bit as well. you know, i think sentiment was already pretty reserved. it wasn't like everybody was bullish and excited. therefore, there wasn't a lot of

risk appetite to immediately take out of the market. >> on oil, is there a sense it does anything more than set a higher floor? >> i don't think so. you can make the case in either direction, it doesn't have much impact or this geopolitical risk premium that should be in there, i suppose, maybe it's a bit higher. at this point, no, it doesn't seem like it's that relevant specifically when you're talking about the weekly inventories and things like that. >> as we think about the overall equity reaction today, how good of a job historically do the markets do in kind of digesting geopolitical tensions? >> i think the market is generally pretty good at looking past the immediate conflict to say, bottom line, what should we be discounting here, if anything, based on the stuff the

market really cares about? if there's not a transmission mechanism through oil prices, if you didn't get a quick rush to safety in treasury bonds that caused you to change the discount rate, it seems as if, in general, we do a decent job of it. you know, i can remember during the syria conflict, the market was getting corrected, it seemed like it was weighed down, but when you look back on it, it was a seasonal blip that coincided with what was going on there. >> yeah, seems like there could be some algorithms. >> it's always the case that there's much -- much else going on relative to the real world headlines we're all preoccupied with. >> mike, thanks so much. turning back to the conflict in israel, the total death toll now has exceeded 1,200 as fighting enters its third day. israel has ordered a full siege of the gaza strip. today energy minister of israel katz said he has issued an order to halt water supply to gaza after cutting off electricity

and fuel supplies on sunday. joining us now to break it all down -- to break the geopolitical impact down is atlantic council president and cnbc contributor, fred. thank you for being here. i know you were scheduled to fly to israel yesterday and that flight got canceled. what were you hoping to accomplish in the region for this business trip and how has the events of the weekend changed that? >> thank you for asking about that. i was going to be on a plane last evening to host a conference in israel with president netanyahu, with ministers from arab states that had normalized with israel on greater economic integration. you talk about the impact on markets now, but there's going to be an impact on economic potential. there's huge potential in the middle east. if only their economies could integrate more widely. we had to pull down the conference. we don't know when we'll be able to reorganize it.

this really sheds light on the situation in the region, which is there's this battle, this contest between modz earnization and moderation. you see that in saudi arabia, the uae and, of course, the forces of hamas, radicalism and terrorism, which seem to raise their ugly heads every so often and no time as bad as this one. >> what's your prediction for how this all plays out in terms of the political and economic stability of the region especially as it pertains to israel's neighbors that it was seeking more normalized ties with? >> i think the big victim is efforts that saudi and israel normalization. those talks have been far advanced. u.s. officials have spent time in israel and saudi arabia. there was the prospect of a deal if not the end of this year, the

beginning of next year. people were giving it a 50/50 chance. right now you have to give it a zero chance. the saudis won't be able to go forward with this right now. part of the deal would have been netanyahu reaching some sort of accommodation with palestine -- the palestinians. that's not going to happen right now. but there's another thing to look at here, which is in a way, this is an iranian proxy war in israel. even if they didn't plan it. even if they didn't give the green light for it. we don't know about that. they're providing the money, they're providing the weapons, they're providing even the wherewithal to build the tunnels. and saudi arabia has to look at this and say, well, if iran can do this in israel and israel's got a much more robust sector than we do, what happens if iran turns on us? over the long term, saudi arabia could come back to this because they'll want the defense deal with the united states that would -- that would have been part of this normalization agreement.

>> how long do you think it will take for things to cool off to restart that process? >> not even the current administration and through 2024. part of it depends on how far netanyahu goes now. there has been comparison to 9/11 in the united states, pearl harbor. where that comparison has looked at is the surprise attack, caught by surprise, intelligence didn't see it coming. third of all, the rage inside israel as there was rage in the united states. but the united states may have gone too far in its wars in afghanistan and iraq. netanyahu should take that lesson. if he does go too far, he could actually bog himself down and israel down in a way that could really hurt it at a time when it could reach a greater normalization with saudi arabia and more generally. it's a very, very tough set of calls the president netanyahu has got to make right now in israel. >> finally, fred, can you help

us understand how all of this intersects with ukraine/russia and the u.s. role in providing aid on that front as well? >> look particularly at patriot missiles. there are only so much to go around and israel is going to need a bunch more. having those, ukraine needs a lot more. the geopolitical implications of ukraine are so high right now for the united states. the president has said he's going to give a speech to the american people. this was before the hamas attack, a speech to the american people on the situation in ukraine. of course, that funding for ukraine has been held up by the difficulties with the ouster of the house speaker. so, these two things coming together, there are some natural links to this. not to mention, that iran is not only supplying hamas, but it's also supplying russia with a great number of drones as well. so, there are global implications to this. it's hard to know how far they'll reach. but certainly worth watching.

>> yeah, the global interconnectivity is certainly complex and, you're right, we don't know the full scale of them at this point in time. it's something we'll be watching. fred kempe, atlanta council ceo, thank you. meantime, the intelligence community here continues to react to the attacks on israel. eamon javers is in sea island, georgia, at a conference where i imagine this is the subject of the day. >> reporter: you're right. this is the sea island, georgia, the annual cipher intelligence conference. i just spoke with a former cia officer who has extensive experience in the region who said he thinks the information war over the next 24 hours is going to be the key. he expects hamas to try to bait the israelies into large-scale strikes in gaza to cause extensive casualties and they can use those casualties on social media. he thinks the saudis will be watching carefully, that same information war, how it plays

out to see if they can proceed with talks on their normalization deal with israel, which he thinks at this moment is at least still possible. as you were just talking about with fred kempe. i also spoke with retired rear admiral mark montgomery. he commanded a carrier strike group in the pacific in the navy. he said the group headed to israel will be immediate lid useful in ballistic missile defense to provide a check against iran. i asked him whether u.s. special forces on those ships could be used in hostage rescue operations if it is deemed that americans are in danger there. >> i'd be very dempb shall to the israelis, despite the failure in intelligence, they tactically have a much better understanding of gaza. they fought there heavily in 2005 and they picked target sets out they've been hitting the last few days. clearly the israelis are the tactical experts on gaza. >> as deferential he said he

would be, he said the united states will reserve the right to do what it needs to do to protect americans in the region, guys. back over to you. >> eamon, i'm curious from an intelligence standpoint how important it is to thread the line between explaining exactly what the u.s. strategy is going to do to help and ensuring that those hostages are, you know, safe and continue to come home safely to their families. >> reporter: yeah, look, from the cia veterans i've talked to here, their sense is that the hostages in gaza now are in very, very difficult situations. very difficult to gather intelligence. you saw the intelligence breakdown in israel in terms of this attack coming in the first place. finding where all those hostages are, identifying the particular structures they're in and coordinating operations to go and get them is just an enormously complex task. the israelis, of course, know gaza very well, as you just

heard admiral montgomery suggesting. the u.s. also has tactical forces that can go in and do that sort of thing. but gathering the intelligence on where they are, and it would be a presidential level decision on the u.s. side whether to get involved or not. that involves some con flikz with israelis. israelis may not want american boots on the ground at this stage. they might say, this is our area, we know it well and we'll handle all operations here. >> eamon, great color, obviously, on a tragic story, especially where you are. we'll look for your help continued. ema eamon javers. the markets, it's clearly about energy, highs for the day, as well as for gold, up more than $20. you have the vix still above $18. stocks flirting with their lows of the session. s&p below 4290. oakmark releasing its most recent buys and sells for q3. we'll take a look at the six names it's adding to its portfolio including health care, energy and one legacy tech

stock. stay with us.

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watching shares of capital one, up 4%. baird says to buy now with trough multiples. loan loss reserves per share. the stock flat on the year, although you can see some significant ups and downs during the last year or so. speaking of capital one, the stocks is big holding, oakmark fund outperforming the s&p by 2% in q3. during that period the fund added six names while exiting three positions. oakmark's portfolio manager bill nygren joins us to talk about some of those moves. good morning. >> good morning. >> walk me through the thinking on some of these. >> well, as you know in the market this year, it's been a two-tiered market. growth stocks dramatically

outperforming value stocks. i think the spread through nine months was something like 2300 basis points. and oakmark is a value investor. a year ago we had purchased some of the beaten up above average growth names and what you've seen in our portfolio throughout the past six months, including the last quarter, was we've been selling off the names names we purchased like uber, adobe, and they have undervalued because they performed by so much. cvs, phillips 66, all single digit pe companies that are returning a lot of capital to shareholders. we think they're great businesses. at single digit pes, a lot can go wrong and we don't have to lose money. >> i thought cisco was

interesting as well. networking so important to the i.t. stack. can you talk about that? >> from early in my career, cisco traded at such a high multiple. you knew it was a great business, but the multiple was so high, a lot had to go right to justify that price. of course, that's changed recently. as cisco went through some flattish years we think they're on the path to getting back to low to mid-single digit growth rates. i think it hits that spot that falls between the cracks where a lot of value investors aren't comfortable buying technology stocks and growth and technology investors don't want companies that are generally returning a lot of cash to hareholders. we still think cisco is a great business. we think most of their capital is going to come back to us both as share repurchase and dividend. and if the company achieves the

mid single digit growth rate they're shooting for, we see no reason it shouldn't get at least a market multiple if not somewhat higher. at the price we're paying for it today, that would be a great outcome. >> we just talked about capital one in the leadup to this segment and also i see financials are the largest weighting in the oakmark fund portfolio with 41% as of the end of june. how has that changed? as we look ahead to earnings season kicking off at the end of the week, which, of course, is including a lot of the larger banks, what is your expectation there and how are you trading the sector? >> first, i want to make sure we don't unnecessarily panic our investors. yes, financials is about 40% of the portfolio. but well under half of that is traditional banks. there are a lot of technology -- financial technology companies

that also end up in the financial sector the way they get divide up. our belief is the banking industry is in better shape today than it's been in a long time. the quality of the assets on the balance sheet is strong. there's a lot of capital to support it. and the stocks are at a relative multiple to the s&p, that's as low as they've been in about 30 years. capital one is a name that we really like, leader in credit card services. one of the reasons we like capital one, it sells at about seven or eight times earning, less than book value. but we think it's kind of a sneaky play on a.i. because capital one has always been more advanced in their use of technology than their competitors. and they have explicitly said they expect more of their processes to rely on a.i. and help them to lower costs and better the outcomes for their customers.

interesting point. i see that it was the largest attracter in the third quarter along with iquvia. what's your take on that stock? >> on iquvia, we think it's a great business, a contract research organization supporting the health care industry. the outsourcing of trials makes so much sense for large pharma. and they combines the resource facility -- research facilities along with all of the data that can help health care companies get their trials set up faster and cheaper. we think it's a great business. again, a large capital return story for a moderate grower. and kind of falls between the cracks, between traditional value and traditional growth buyers.

>> finally, bill, i know we always have this conversation about how you're not necessarily driven by news of the day or even the quarter or the year, but does the action in the middle east, the geopolitics element of today's news alter the long-term playbook at all? >> for us it doesn't. you know, i -- i would be your worst possible interview for what's likely to happen in the mideast. but i think one thing it does is it highlights the value in a portfolio of energy exposure. we've kind of forgotten that energy oftentimes moves the opposite direction of almost everything else in the portfolio. and they're cheap stocks on their own merit, single digit pe ratios. we think there are strong arguments for why oil prices should stay in the $70 to $90 range, which is a very healthy outcome for these companies.

a lot of capital return to shareholders. but they have almost that negative beta role in a portfolio that helps lower the risk of the overall portfolio. >> hence the phillips 66 in the quarter as well. bill, that was a lot. i'm glad we got to some of it. good to see you. talk soon. >> thank you. >> bill nygren. ian bremmer on the conflict in israel. he joins us in a few minutes. we're watching defense stocks, as we said. the entire sector is higher. here in hawaii there is always time. there's time to spend with family, time to enjoy with friends. there's always time to listen or lend a helping hand. here we have all the time in the world, but no time to waste.

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the worst performing s&p sectors on an interday. transport, banks, materials, discretionary. we'll watch that closely as the action of the defense and oil names are steamrolled. >> we're about two hours into trading. let's go post to post with bob pisani for a look at what is moving. good morning. >> good morning. we are off of the lows and fairly quiet trading despite all that terrible news out of israel. remember, the bond markets closed, but bond etfs are still trading, bond futures are still trading. the travel stocks did not need this terrible news out of israel. new lows for southwest, new lows for american, essentially. the cruise lines all down. september was terrible in general. casinos are down. so, obviously, that's an obvious sort of thing that would happen in this situation.

it's interesting to watch commodities in general rally at this point. oil was straight down last week. it's back at $86. so, oil services names, exploration of production companies, slb, one of the big oil service names. that's been trending up recently. other commodities are also rallying. copper, interesting, bottomed last week and rallying on friday. up today, freeport, a stand-in for copper and gold, which has also been rallying. it's also doing better today. agricultural commodities are also up today. the two big ones that trade down here, bungee right here, trading to the upside, big global commodity trader on the upside. some other commodities, mosaic also trading up. agricultural commodities trading on the upside. finally, it's important to note that even though the bond market is closed, bond etfs and bond futures continue to trade, including bond etfs down here on the floor.

pimco active bond etf trades here on the floor. it's been trading all morning. of course, there's an understandable flight to safety. all of the bonds trading to the upside. you have 10 to 20-year treasuries, 3 to 10-years. etfs are all trading down here, all trading to the upside. very understandable, as i said, flight to safety there. guys, back to you. >> we'll talk in a minute. ian bremmer is next on the latest in israel. we're back in a colef nus.up o

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welcome back to "squawk on the street." i'm silvana henao with your cnbc news update. a group of senators led by senate majority leader chuck schumer met with china's president in beijing. senator schumer expressed disappointment by what he described as a lack of sympathy

for israel after the surprise attack launched by hamas. earlier this morning, the military wing of hamas said it launched 90 missiles in israel near the gaza strip. meanwhile, israel defense force officials said it carried out air strikes against 130 hamas targets over the last three hours, while israel's prime minister told local officials the counteroffensive is, quote, just getting started. european commission is halting all aid to palestinians in the wake of the conflict. leaders said all payments will be immediately suspended and its full development portfolio of $729 million is under review. the commission, which is the eu's executive arm, is the biggest donor to palestinians. carl? >> thank you. we continue our coverage of the conflict in israel this morning. let's bring in eurasia group's president, ian bremmer. your commentary is a chilling

read today, but the one thing that stands out is you write hamas has launched a suicidal war and will pay mightily for it. what are you bracing yourself for? >> i'm bracing myself for a long ground offensive. something that netanyahu himself and very many israeli leaders have always resisted because urban warfare leads to insurgency, lots of civilian casualties. it's very bloody, it's very painful. so, this is not going to be a matter of just weeks or month. we may be looking at a new normal for how the israelis view gaza. i mean, i'm saying that with a lot of conviction in part, carl, because the atrocities committed by hamas terrorists against the israelis this weekend do reflect the greatest savagery we've ever seen against jews on the planet since the holocaust. 10 million israel citizens who,

you know, live surrounded by enemies, the impact this is going to have on them and their government is really almost unimaginable for any of us sitting in the united states. >> yeah, it's truly hard to comprehend. ian, you mention the new normal. i've seen others calling for a new world order for the region. what do you think that ultimately looks like? >> let's be clear that part of the reason this happened is because we are seeing a new world order. israel, i mean, as much as we have to talk about what they've just faced, israel is also in the best geopolitical position they've been in in decades. it's precisely because lots of countries in the region have been willing to do business with israel, even open diplomatic relations with israel without any preconditions on how they're treating the palestinians. ined do, the position of the palestinians has only gotten markedly worse over the last decades with the ramping up dramatically of military

checkpoints and of israeli settlements in the west bank. at the same time, israel now has relations ongoing with the uae, with bahrain, with morocco. if you go to abu da, you see tourists every day but at the same time nothing was being done to resolve the palestinian issue. we haven't talked about the palestinians at all. we were talking about a judicial reform that was leading to a constitutional crisis and demonstrations on the ground. the israelis were taking their eye off the ball in terms of palestinian security. particularly in terms of gaza. and i do believe in part it's this new world order where leaders around the region are willing to work with israel absent the united states that led the hamas leadership, a bunch of ideological dead-enders

calling for the destruction of israel to do something so dramatic and so suicidal. and that means that we are now not going to ignore the palestinian situation. we're going to be talking about. they're going to be relevant for the region and for the world, but in a way that is going to lead to just enormous destruction of the palestinian territory. >> and we should be talking about it. you mention -- you say, quote, it's an understatement to say the israeli government has been distracted. you know, how does that distraction filter through to the response here? are there lag effects of just the overall internal crisis israel has been going through prior to the events over the weekend that could complicate their ability to, you know, engage in this war effectively? >> well, i saw an editorial, you know, from the editorial board in heratblaming a left wing,

but well respected news agency in israel, criticizing netanyahu only a couple of days after this -- these attacks. i mean, certainly you're still going to see polarization. but i want to be clear, the top priority, one, two and three in israel today and for the coming months, will be responding to this existential national security threat. on the border, the hundred plus hostages that are being held in gaza, who need to be returned and taken back. and the israeli defense forces will be focusing on that with, i'm sure, american support. i expect -- i think it's very likely we will get a unity government of national emergency, which means that the previous opposition leaders will join with netanyahu in governing the country in a period of wartime. so, that doesn't remove all of these internal challenges. that does not in any way make us forget about the fact that this

happened on netanyahu's watch and there will be accountability for that. his legacy will now be this failure, will now be these hamas attacks and his response. everything else is secondary and by a long margin. but for now, sara, the country will be purely focused on this response in gaza and potentially more broad. >> finally, ian, congress getting briefings now on, i guess, what's possible in the way of u.s. aid and munitions. that's going to be a whole other conversation about thoptions fo third-parties like the u.s. >> the u.s. will be unquestionably supportive of israel all the way through this. right now there's a lot of support for israel. that is clearly going to be tested mightily as you start to see a lot more casualties of palestinians over the coming weeks and months.

but i expect not only will you see more military support from the united states, but also more direct military coordination at the highest levels. yes, that might well include as part of an israeli occupation that the americans would provide logistical support, direct military support, getting involved in the fighting, tomahawk missiles. these sorts of things, i think all of that is on the table as we talk about america's most steadfast military ally in the middle east facing what has been their worst collective tragedy since israeli independence. >> sadly, this conversation is just getting started, ian. we appreciate your help with it today. ian bremmer, thank you. the attacks on israel adding urgency to the house speaker crisis here in the u.s. emily wilkins is in washington with more on that story. hi, emily. >> reporter: hey, leslie. yes, right now the house is completely paralyzed.

they can't move forward with anything dealing with israel, really any legislation at all. house members are trag to work on getting some sort of resolution together, but first they have to pick a speaker. the timeline for that, the house republicans are going to meet tonight around 6:00. they're not going -- they're going to stress a couple of different things but we're getting into the weeds of it tomorrow when there's going to be a candidate forum. we're expecting to hear from steve scalise and jim jordan, but something interesting has happened given everything we've seen in israel. kevin mccarthy is, as we speak, holding a presser in which he's calling on president biden to do a number of different things to alleviate some of the fighting, to really assert america's strength. this does not sound like a speech given by someone who does not want to be speaker. in fact, mccarthy mentioned during the speak he still has the support of 96% of his conference. he did not rule out that he would want to run again. we do know there are still

lawmakers who support mccarthy and are willing to vote for him more times. so, i think what, if anything has happened right now is that mccarthy has re-emerged as a potential candidate to be named speaker again. it's potentially going to complicate the ability for republicans to come together. they're going to start voting on wednesday internally behind closed doors and they're hoping to reach a unanimous consensus before going onto the house floor and having the official speaker vote with democrats. of course, senate side, the senate is out this week. majority leader chuck schumer is in china. he met with president xi jinping. this was a planned trip. he was expected to talk to various leaders in asia, in the area about the ways that the u.s. could work and collaborate with them. at the same point, he is keeping a steady eye on what's happening. he and other top leaders in congress got a briefing on the situation in israel. we're expecting to kind of get more and more information as this week continues. guys? >> so many crosscurrents on a

global scale on this developing story. thank you. up next, kkr on the opportunity and private credit and the market on an interday basis, travel are some of the biggest laggards on the publicly traded markets. you can see carnival down about 5.5%. american, delta, united, some airlines also down significantly today. stay with us.

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welcome back. demand for private credit and private credit investments has surged in recent years thanks to tightening banking conditions. now morgan stanley estimating the d$1.5 trillion could grow t $2.3 trillion by 2027. is there opportunity here? joining us now, kkr partner and co-head of credit and markets chris sheldon. kkr's credit arm has about $200 billion in assets under management. chris, so, we were talking in the break about how private credit has suddenly become the

buzzy term on wall street. surprisingly because it's really been collecting a lot of capital from investors in recent years, especially -- there's been some muted private equity deal flow, which they're known for financing. what do you think about kind of the future prospects of this asset class? do you agree with some of the sentiments that -- morgan stanley, apollo, all have said we could see a doubling of this in five years or so. do you agree with that? >> i totally agree with that. it's a growing market for a couple of reasons. one, it's becoming a permanent allocation in people's asset allocation. i think 2022 really highlighted that it's a resilient asset class. you know, low vol, high income, and it actually, you know, is a great place in a portfolio. second, as a result of the volatility in the capital markets, the borrowers are actually seeing it's a great tool in their tool kit to use. and a lot of the sponsors and a lot of borrowers that never use

private credit before are using it now and having a really positive experience. so, as the market grows, and there's $2 trillion of dry powder in equities, it's going to continue to be part of the tools in the tool kit for borrowers. >> does that erase some of the irr potential, though, for some of these lenders as you do see more competition come into the market, some have raised concerns about deteriorating lending standards as a result of that, additionally this is a floating rate instrument, so it's typically more expensive than what you see in the public markets. >> i think what you're referring to within private credit is direct lending. i think private credit is a much vast, larger universe, including junior debt. even asset-based finance. that's going to continue to grow, particularly as the banks retreat. it's also just a great at this interest rate environment, just a great income generator. i think what we're seeing today is a lot of rhetoric about, you know, and a lot of buzz around

it, but what i don't want to forget is there's a big public market out there. that needs to co-exist, too. both need to co-exist together and should co-exist together and will co-exist together. we just need that market to sort of come together and have more options for our investors and more options for our borrowers. >> are there steps you think need to happen to democratize it even more, make it more obvious to the regular lay investor, education? i mean, segments like we're in right now. >> yeah, i think you need it to become -- i think you need more of a functioning capital markets. you need the markets to be wide open. you need m&a to start picking up. leslie, as you mentioned, there's just not a lot of activity right now because a lot of it's being sponsored by m&a or leveraged buyouts. i think that needs to come back. we need a little healthier market for, i think, more people to realize that it's -- it's a permanent allocation.

but what we're seeing from our investor base is it's becoming more of -- more of a permanent allocation versus coming out of a tactical allocation or an opportunistic allocation. >> you mentioned public credit and private credit can co-exist together and need to co-exist together. i was hoping you could explain that for our viewers.coexist together. so much of the conversation lately has been around higher capital requirements for the large banks and a taking of share by the private credit funds in the economy and speaking with you and other folks in this area say they need to coexist together because it's an important financing mechanism for what you do. >> they will. a big part of why private credit is getting so much buzz because they're not there. a lot of what banks do is underwrite to sell and with a lack of m&a and a lot of uncertainty that we're experiencing today and turboed over the weekend, the banks

aren't just leaning in and willing to take the risk. what the private credit is offering is the solution and pricing at risk today, but once there is more consensus in the market and conviction a lot will shift back to the public markets. >> you think the health of the borrower community is still on stable floating at this point? >> it is. we're starting to see deterioration of fundamentals and dispersion and interest coverage getting tighter. do we expect defaults to increase for sure? do we expect a big spike of defaults? that's not our base case. >> thank you. >> thank you. >> still to come, nelson peltz back pushing for change at disney. details after a short break. (♪♪) it's inspiring to work at a place where our patients succeed. and where we as therapists do, too. with great benefits from principal,

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arm holdings getting quite a few bull calls today. a slew of analysts initiating coverage and are optimistic about the chip designers growth. that's what deirdre bosa is watching in today's tech check. >> 25 days since arm went public. that's the quiet period before the banks that underwrote the ipo publish research. in arm's case there were many of them. a flurry of notes this morning. i counted 10 altogether. every one of them a buy, that leaves just one sell rating from bernstein, not involved in the ipo and gives arm a medium price, a mean price, target of $63.43. $10 above where it trades today. the market has cooled on arm. the stock surged 25% on its debut, ipo day, but has paired

back most of those gains. since i covered softbank i'm always interested in what this means for massa sun. this chart shows the equity of softbank holdings. habs been the crown jewel under pinning masa son's push into the vision fund and letting him shore up finances amid uncertain times. alibaba went from being 23% of softbank to a minuscule 0.1% proportion. it is the orange. you can barely see it on the second line there. the biggest holding the blue parts of the chart, the vision firms one and two. the new crown jewel is arm. which softbank owns 90%. it is the yellow. as you can see it went from a

12% stake in march of '22 to 22% stake in june of this year. what he does with that stake, guys, very much an open question still. he stepped away from softbank's day to day to focus on bringing arm public and said he wants to go back on the offensive, particularly in artificial intelligence, but the vision funds, after years of what's called questionable bets may have a reputation problem. the information reports that massa is focusing on a secretive softbank investment, separate from the vision fund. i reached out to sources and softbank and vchaven't heard ba. masa son moves quick. he started investing in public tech companies. wouldn't be that unbelievable if he's using another tactic to go after the generative ai hype cycle. >> you bring up a good point to masa son and what he plans to do

with the remaining stake in arm which is a large amount and part of that has been the overhang that this stock has seen, the idea that they could be just coming to the market when that lockup expires with shares every quarter or every couple months or so. what's the sense and kind of how the stock is trading today and that overhang relative to just the overwhelming burst of optimism that we saw in some of the reports? >> softbank or arm? >> arm. >> all the reports out today were buys, but there are questions about the valuation. we have broken this down before, but it is so much pricier than the average chip company. while it is supposed to be a play on generative ai it's not there. it lies on smartphone revenue. it has a long way go and that's where some of the skepticism comes from, does it justify the valuation? >> the technical aspects and skepticism of the future potential of this company. thank you. want to get to disney. nelson peltz is back.

julia boorstin has more. hey, julia. >> that's right. nelson peltz fund management is one of disney's largest investors with a stake of 30 million shares worth more than $2.5 billion and plans to push for multiple board seats, according to sources familiar with the situation. this comes after disney shares hit the lowest level since 2014 and in january launched a proxy fight against disney criticizing the acquisition of fox and failed succession planning. peltz dropped the battle after bob iger unveiled corporate reorganization and meaningful job cuts. iger has announced he's exploring selling the linear networks, plans to take espn directto consumer and disney last month announced it's doubling its investment in its parks division. disney had no comment on this and we are awaiting an official announcement from nelson peltz. >> julia, appreciate that and

we'll talk about what that might mean for the media giant in the days to come. so much headed our way in the next few days, ppi, cpi, fed minutes, pepsi, black rock. >> bank earnings. >> bank earnings. >> earnings season in general. >> but the situation in israel is going to cloud a lot of that, what was already a crowded week. let's get to the judge and the half back at post nine. >> thanks so much. welcome to the "halftime report." i'm scott wapner. the week ahead for your money, inflation date, kick off to earnings season and now new geopolitical risks to consider. our investment committee on the case. joining me for the hour, josh brown, joe terranova, jenny harrington, steve weiss. check the markets where we're off the lows. the dow about to go positive and looks as though. s&p following that story as well. nasdaq negative and the russell, in fact, is positive today. so joe, we turn to you, so we got a big week