1% on pace for its eighth session winning streak. maybe the last two weeks of augustering but we still have a lot going on. jackt tson hole on deck. >> palo alto one of the few stocks in the hundred billion or more up more than 2%. amd, nvidia among them. that's going to do it for "power lunch." you can catch alto alto earnings on overtime. >> welcome to closing bell. i'm scott walker here at the new york stock exchange. we begin with this broad based rally in stocks. the major averages building with even more gains today. we'll ask our experts over the final stretch how far this rally can go in the weeks ahead. look at the scorecard with 60 minutes to go in regulation. we have green across the board today. all s&p sectors are showing gains today. nice action from the nasdaq, up near 1%. how about volatility? two weeks ago, it went crazy. well, there it is today. subdued, under 15.

the yields on treasuries are mostly lower across the curve. that fed summit in jackson hole is looming at the end of this week. we also have some important earnings in the days ahead, including lowe's and target and macy's. we're watching all those shares as well. discretionary stocks having a pretty good day, all in the green. a renewed focus on the health of the consumer after better than expected data lately. that is all even more relevant now. it takes us to our talk of the tape, whether the bullish momentum is back following that scare a couple weeks back. let's ask our panel that question. chris is cio of maryland bank of america, lauren goodwin is chief market strategist with new york life, and malcolm is executive vice president of cmc wealth. lauren, i'll come to you first. evercore isi says today the trajectory for equities skews higher. goldman's trading desk siz the pain trade is higher. i want everybody's opinion and yours first. >> i expect that the market can move higher as long as the economic data stays in line.

if that means as long as new unemployment claims aren't rising above what i see as a critical level at 260, and as long as earnings remain robust. the real challenge for investors is that though that essentially looks like a melt-up higher is possible, the market is likely to be incredibly reactive to the economic data. now, why is that the case more now relative to any point in the last couple years? it's because now, good news is good news. and bad news in the economy is bad news for the markets. the fed's focus on inflation has transitioned to one on the labor market and growth, so i do expect that though the market can continue moving higher, it's going to be a very bumpy road ahead for the next few months. >> malcolm, our question on the screen, is the bullish momentum back? yes or no? >> yes. i'm a bit in agreement in the sense that any news that we get is going to be a pretty big push in both directions. i think that investors are

pretty split right now on whether we think interest rate cuts is a good thing or a bad thing, so i definitely think we're going to -- i'm surprised to see the vix down so low today, because i definitely think we're going to get movements sort of on a razor's edge of any economic data we get wednesday and friday, obviously. >> so chris, how do you address this? is the pain rate higher? are we skewing more positive and it's remarkable the conversation we're having given what happened two weeks ago. we moved far and fast away from that. >> amazing what two weeks will do. i would say to directly answer your question, it's going to be very, very difficult to stop this market from going higher. the reason is, data is being set up to be lukewarm, exactly what the federal reserve is looking, for exactly what investors are looking for. we might get a miss here or there, but not material misses. there's a lot of distortions in the data over the last couple

month, but when you average that together, and now on a go-forward basis given what we saw in some of the recent report, this data is lining up to be lukewarm, and lauren is right. good news is good news. bad news is bad news, but you blend those two together and get lukewarm data overall. >> you could say goldilocks if you wanted to. that's what i think of when you say lukewarm. just right. >> yeah. i like to use another term, which is basically balanced. the balance tat we don't have is usually the unknowns that we know. it's geopolitical risk. we can't fix that. but what we do know is what the fed is going to tell us. we do know where they're headed. they have told us that before. and the fed funds future market will shake us out here and there, and it was a way to clean up the excess. and now we're starting to get a little bit better base going forward. it doesn't mean that performance is going to be as good as it

was. it simply means we have a healthier base to build from. >> the only thing i guess i would take issue with, with what chris said, malcolm, is that we know what the fed is going to tell us. we think we know. we think we know. we're feeling like we do know. we have priced in what we think we know. now we need the fed chair to actually deliver on that later this week. and what's good enough? if he lets us believe that 25 basis points of cuts is coming in september, and that's the beginning of a new trend, is that good enough? >> yes, i think you framed it up perfectly that we think we know, but we very well may not end up with a cut in september. i really don't think the number of cuts before the year's over is really what matters here, whether it's september or a later date. i think the depth of those cuts. you mentioned 25 basis points. sort of baked in in everyone's expectation. if the fed were to surprise us and go later with a 50 basis

point cut or a 75 basis point cut, the depth of that cut i think is what is really going to signal to the markets, whether they see some significant economic pain coming or if we really are on the verge of this soft landing that they have been promising us for about two years now. >> i feel like the way outlier view, to be frank. i think most people at this point and they have telegraphed it, i feel like, as much as they could possibly do, that they're cutting in september. what makes you think that they very well may not? >> i think it's important to consider that the fed at some point has to shift away from being data dependent as they have morphed themselves into, and get back to being forward looking. i think maybe this jackson hole symposium could be the place where the fed decides to get forward looking and says to us, here is where we have outlined the cuts need to happen, and maybe we get lucky and the fed tells us here's the depth of what those first -- the first cut, maybe the first couple cuts

look like. i doubt it. i understand that the consensus is the consensus for a reason, but we have to at least consider the fact that the rosy goldilocks scenario we have all framed up in our minds may not come to be, and maybe there really is some other pain on the other side. >> lauren, so from two weeks ago, the low, okay, the dow is up 6%, the s&p is up 9%. the nasdaq is up 13, and the russell is 8.5%. does that embolden the bulls yet again? mike santoli earlier was asking the question to everybody, really, does the volatility hurt or help the bulls' case. that we have rebounded as much as we have in august or is the volatility itself enough to hurt the bulls' case? >> i think that the bulls are emboldened not only by the volatility but by the momentum. the market narrative.

the couple of weeks in favor of a soft landing story. i think the bull case is challenging is again not that the equity market can move higher but where the winners and losers are likely to come in an environment where i expect volatility in both directions. in a more reactive environment, one where the market, the fed, investors are all more concerned about economic growth. that's an environment where i don't expect small caps to consistently outperform. where i do expect technology and energy could consistently outperform, not necessarily just from a sector basis but because that's where we're seeing consistent improvement in free cash flow, in earnings, and though it's a bit boring from a sector perspective, it really is those fundamentals of earnings quality that's likely to drive consistent equity market performance for investors in the coming months. >> chris, how do you adjust

that? this renewed volatility, i guess, although it's funny even asking you the question with the vix under 15, so maybe that was just a fit of volatility, and now it's going to be subsided for a while. how do you see that? >> i think that's right. i think august 1st, 2nd, and 5th, if you just look at that snapshot, particularly monday, you have like a flash crash in volatility. it's quantified, we know the index. we know how they do that. but that was a point in time. if you put things in perspective, it doesn't feel good when it's three days or one day, but the draw down wasn't that big. it was big in the areas that rode the market, but now when you start to see that crest and come down, the one thing you look for is if the rest of the market is now starting to get up off the ground with their fundamentals. and we're starting to see earnings growth for the rest of

the 493, so this is actually a pretty good healthy correction. it doesn't feel good when it's one day or three days. >> chris, let me ask you this. i apologize for interrupting you because i think it's the earnings outlook that some are taking great issue with, that yes, the outlook is optimistic, but it's far too optimistic. that's one of the points that adam parker made when he was sitting with me the other day, that yeah, earnings, we printed 11% growth, and we're optimistic moving forward, but they're way too high. what do you think? >> yeah, adam does great work. respective work. i would say this, the analysis when you aggregate it all together, you go, huh, maybe next year is only 8%. when you go stock by stock in the s&p 500 and start to see more stocks actually piercing the zero line on their earnings, that second derivative is much more powerful than the aggregation because the top end of the market is coming down off their highs. for me it's about participation.

that creates a healthier market even if we're only going to grow ate 7%, 8% in earnings next year versus the 11% or so now. >> are you making the case, chris, that we can believe in the broadening again? is that what you're saying? >> yeah, what i'm saying is this is a rebalancing. this is not a rotation, not a movement, a wave in and out and then a broader movement. it's a natural rebalancing finally that when you start to see areas of relief mixed with areas of value, mixed with quality growth, that all together and yield is what should be the characteristics of the market for the next 12 to 24 months. >> lauren, why don't you weigh in on that and malcolm the same thing, because it's central to the conversation. i read you the rebound in the nasdaq of some 13%, has people feeling like okay, we're going to go back to where we are. you are going to have the mega cap stocks just continue to lead the way, and nvidia on the 28th

when it reports its earnings is gauche to validate all of that. lauren, how do you address what chris refers to as rebalancing, not necessarily rotation? >> i think that rebalancing is an incredibly intelligent move that investors can make on days like the first, second, and 5th, when we see an outsized reaction in the market. and i agree with chris that that was an outsized reaction. i also expect we're going to continue to get highly reactive markets on big data days like the job reports, like inflation. how do you rebalance then? i think a big part of the story is diversifying sector xposure. i think you have to be invested in mega cap tech because of the quality of those earnings. but we're increasingly looking to small and midcap growth companies with quality earnings, we're also looking, as i mentioned, at the energy sector, at financials. and we're looking at utilities

as a way to diversify an equity exposure when we expect more volatility in both directions. i think importantly, we're also looking to the bond market. we talked a lot about a fed that looks poised to cut in september. that's an environment where the yield that investors are capturing on money market funds is going to move lower. and so we expect that we'll continue to see flows towards short duration fixed income trying to capture the higher rates and that's a balance that does make sense as we move into a fed cutting cycle. >> malcolm, you can make of rebalancing whatever you want. it can have many different forms and definitions as it relates to a portfolio. the main point being that it's a drop down, i guess, in the exposure you might have to mega cap and rebalancing that into other underperforming or less, you know, performing areas of the market. it could be into treasuries in some respects, as lauren is talking about, and maybe other

areas of credit too. so how do you see this rebalancing taking effect if you in fact believe in it? >> yeah, so i don't necessarily believe that the rebalancing is going to happen right this minute. i think the rebalancing is actually going to have to be forced. i think the market is going to have to break investor psychology and break the momentum of the last few years where everything in the nasdaq at the top your tile of the nasdaq is what everybody wants to own. i think there will and should be a rotation within mega cap tech, even, forget going to other sectors for a second. i think that the undertone in the earnings of the second quarter that's kind of been overshadowed by the 11% growth you were talking about is the number of layoffs within mega cap tech that have happened so far this year. if you thing about the fact 130,000 tech workers have been laid off so far this year, and the year is nowhere near over, that's about 60% of where we

were in 2023. and 2023 was a brutal year for tech workers as far as layoffs were concerned. i know these companies are giving us the line that these job cuts are necessary so that we can repurpose that capital to be able to invest in artificial intelligence and the growthier areas of the company, but i just want to say for a second that we should at least consider the fact that maybe there's more to it there. there's a little more of an undercurrent and it's being swept under the rug at this moment by having a little bit of an ai glossing over. i'm a little concerned within mega cap tech. that's where a lot of my own personal portfolio is along with a lot of our clients at the firm. we should at least consider the fact that rotation needs to happen even within the tech sector, but i don't think it's going to happen willfully. i think the market is going to make it happen. >> just to let me clarify one thing. you said earlier, a rotation within mega cap tech, and you finished by saying a rotation within other areas of tech

itself. are you saying to be super duper selective within the mega caps themselves, or rotate out of some of the mega cap names into some other areas of tech? can you be more specific for me? >> i appreciate you giving me the chance to clarify then. i'm talking specifically the mag seven when i initially said rotating away from. so investors have shown a habit of any time there's a movement in the market to the downside, we sell off the mag seven. we go to cash, and then any time it looks like all is clear, we buy back the mag seven and that's what drives the market bag um. i think a rotation within mega cap tech that allows us to look for other names, the chip makers, for example, moving away from just nvidia and amd and rotating to other places that are semi-conductor names, for example. i think that is what is ultimately going to have to happen to help diversify a little more within the tech sector. >> i told you have you eye on cyst co. why are you watching that so

closely? >> i know that it's been one of the biggest losers in tech for the last five years running, but i do think that company, there is a little bit to like there. they do have a pretty good install base with their security kumers already. and i think that cisco is a company that's going to benefit from the push that's being made in cybersecurity, that large spend and the necessity of that spend on cybersecurity that's happening because things like phishing scams and others have been made more possible and made faster by ai. so i would look for cisco to be a beneficiary of the platformization push and also from the consolidation that's going to happen within cybersecurity next year. >> chris, you don't necessarily talk individual names, but one name seems to matter maybe more than anything else right now. it is nvidia. i did reserve the fact they will report their earnings on august 28th. your bullish view is pretty clear from what you articulated today. what's really riding in your

mind on that report? >> i think it's the biggest thing riding on the report is momentum. we had a huge momentum coming off of obviously august 5th. but if you look at what has performed and what hasn't off the momentum list, and names have underperformed, except for one or two. overall, relative to the rest of the momentum area. systematic institutional investors, position traders on a day to day basis, are going to have to follow the momentum. they did it to the down side on the great carry, they did it back on this reversal the last couple weeks. and good results coming out of bellwethers like that momentum bellwether are needed to keep that area at bay. they're not necessarily needed to significantly outperform the so-called whisper expectations for the whole rest of the market to change what is beginning to happen, which is a greater participation. >> lauren, you want to address that too? all that might be riding now on this earnings report given the

volatility that's been introduced in the last couple weeks? >> absolutely. there's no question nvidia's earnings are likely to drive the market as a whole. and whether that happens of course is a bunch of not only what the earnings are but what guidance is. there is potentially slightly less risk on the back of an earnings environment that has otherwise been fairly constructive. you see a big market miss in the moment of nvidia earnings mis, but where the stakes get larger for me, from an allocator and from an economist perspective, is from my perspective, actually the biggest risk to the economy is now a major sell-off in the market. now, it would have to be sustained, but our research suggests that for every 5% draw down on the equity market that is sustained, you get about a half a percentage point of consumer spending off annualized gdp. that's a major number. may even be bigger in the economic cycle where we know where the preponderance of consumer spending is coming from

high income consumers who are so impacted by the ebbs and flows of the market. so it really can't be overstated how important that report is next week. something we'll be watching closely, not just for tech earnings but for economic trajectory as well. >> malcolm, last question to you. we said palo alto, the earnings in overtime. you earn the stock. what are your expectations, how high is the bar? >> i don't think the bar is all that high right now. i know investors and analysts will be listening to the earnings call expecting a 50 pe to justify the valuation considering revenue is declining, billings are declining, eps growth has been declining for about a year now. i don't think this is the quarter we're going to get that. it's early innings for the platformization pivot the company is making so i think there is tons of opportunity for palo alto, but i don't think this is the quarter where they're going deliver what those expectations are to the street. >> we'll leave it there. good talking to everybody. we'll see you again soon.

to pippa stevens for a look at the biggest names moving into the close. >> shares of paramount are getting a lift following a bloomberg report the company is likely to extend its go shop period if bronfman makes a bid for the company, they have agreed to merge. >> a trio of downgrades to neutral from piper sandler which noted a lack of industry pricing power. sweet green shares down 6%, while the firm says it believes in the long term growth story, that upside is now reflected in the valuation. dutch bros on track to snap a four-day winning streak, and shares of shake shack lower by 3% with the firm citing a worsening industry backdrop for the burger chain. >> thank you. >> we're just getting started. up next, a chip challenger, amd, going after nvidia in the race for ai supremacy. deep water's doug clinton is

back. he reveals the name he prefers in the space and what is ahead for tech at large. we're live at the new york stock exchange. you're watching "closing bell" on cnbc.

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are federally tax-free and have historically low risk. call today to request your free bond guide. 1-800-217-3217. that's 1-800-217-3217. we're back. amd rallying on news it plans to acquire server builder zt systems. nvidia investors though not shaken by that news because right there on the screen, the stock is up near 4%. joining me is doug clinton opdeep water asset management. the firm buying that stock, nv nvidia. you finally decided to buy nvidia. >> it was too good to be true for us. nvidia is a stock that they are the arm supplier of this ai arms race. we have wanted to own it for a

while, but for price. and we finally got that opportunity, the yen carry trade blew up. there were rumors about blackwell delays, their new chip. when the stock traded down into the mid-90s, you had a forward pe, 25, we felt like that was the right time to enter. >> this news today of amd and this deal, if you're an nvidia investor, is that a snoozer to you? is it meaningful in your mind? >> i don't think it changes anything for the next one to two years. really, what this is about is amd trying to get more competitive in these training clusters. helping big customers, the hyperscalers build out data centers and be more creative. it's something they weren't doing before. it's something nvidia is already very good at. it's not something that amd is now doing nvidia is not. i don't think it's a big threat. >>ia don't own amd, but you do own broadcom, which stacey, who was with us just the other day,

suggests has the second best story. amd may be third, but the feel is in some corners it's a distant third. why broadcom over amd in your mund? >> two pieces, the networking story. they're a leader in networking. when we think of data center ark atectures, they can speak to each other, and operate more efficiently. but the even bigger reason that broadcom for us is a big ai play is their partnership with google on tpus. they're the provider in terms of google building its own silicone. i think you're going to see companies like meta get more aggressive. that's the next story for the three to five-year picture. >> august 28thish that's the date looming large. nvidia's earnings report. you want to tell me as a new investor how you're thinking about that day? >> i think it was derisked when we bought it at $95. now i'm a little concerned.

>> it's crazy. >> difficult. i think that resets expectations going into that event. the thing that worries me, and are don't know that it's going to be an issue or not, but what worries me now that didn't worry me before is we have rumoroffs the blackwell delay. if that turns out to be true, if it looks like there's maybe this air pocket in revenue a little bit as nvidia waits a quarter or so to get those products into market, that could be something for the stock that's dangerous. i think most people who are paying attention to the story know this delay is possible. but there's always someone who doesn't know. >> are you thinking about just how much nvidia might be overearning now because of all the spending that we're seeing from the hyperscalers in this area and the mega cap stocks, how much they're spending or what that mines in the big picture? >> we don't really know. i also, i would argue we don't know the hyperscalers are overspending. i think they are appropriately spending and maybe some of them should even be more aggressive because we think about ai, it is

the most important technology, maybe that we ever developed. and so i think it's kitical for all of these hyperscalers to have a race, a game in this race, and really put their best foot forward, invest as much as possible. because if they miss it, that's worse than if they spend a couple hundred billion on capex and ai turns to be real. >> i didn't mean to suggest they're overspending. their spending rates are up 40% or 50% year on year, but the idea that they're spending so much that if there is any part of a bearish view or at least a cautious one on nvidia, it's the fact as a result of that spending, they're overearning now. >> right. >> i think for us, this ai whole market we're in, i think it's still very live, very vibrant. i think we still have two to four years. maybe as we get to the end of that, we can have a deeper conversation in terms of

overearning. i think this is the reality of nvidia for the next few years. >> aside from your new buy of nvidia, alphabet looks to be of the only mega cap tech stocks you own. we're marking 20 years of that company being public today. why is it the only one outside of nvidia, and what are your expectations here moving forward for that one? >> we also own meta. so that's kind of our three horsemen. for google -- >> i missed that one. my bad. >> those two have been two of our favorite plays on ai because they have reasonable forward pes. they're earning well and they both control their own ai des destiny. for google in particular, this is something we have talked about before. i think they need to find a hunger, an urgency they still don't have. last week, we had this news with eric schmidt talking about google basically being kind of soft. and i think we would agree with that as investors. we said we would love to see them do a little more aggressive of a head count and try to find

that urgency in the ai race because they're losing to openai. >> you don't think microsoft lit a fire under google by everything that's happened over the last year plus? >> not enough of one, unfortunately. they're talking the game, you know, we had quotes from the head of search saying that this is urgent for us. this is important. but we still haven't seen the action yet, and that's what we're waiting for as investors to get really excited. >> good to see you. that's doug clinton. don't miss amc's ceo, lisa su, an cnbc exclusive interview. up next, a rotational refresh. tech leading the market for much of this year, but nick colas says two other sectors are ready to break out. we're back on the bell just after the break. (♪♪) (♪♪)

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welcome back. there's breaking news out of chicago. eamon javers has the details. we're learning more about the policies of the democratic nominee and vice president, kamala harris. >> yeah, that's right. one of the big questions has been with kamala harris' economic agenda, how is she going to pay for all this? we're learning details. a spokesperson telling nbc news one of the ways she's going to pay for her proposals is by raising corporate taxes. she's now endorsing a hike in the corporate tax rate to 28%. that is nbc news reports, her first major proposal to raise

revenues and finance the expense chb plans she wants to pursue as president. that's not necessarily a surprise, skautd, because that puts her scquarely in line with where joe biden has been. no daylight between the presidential nominee and the existing president of the united states on the democratic side, but it is something of a reversal for corporate america, which has been enjoying 21% corporate rates since the trump tax cuts, and of course, president trump has said he would keep those in place and perhaps go farther if he can. in terms of tax cutting. one other thing to bear in mind about all these proposals from presidential candidates when they're running on the campaign trail, they have to get these through congress. one of the big questions is if kamala harris does win and pursue a 28% corporate rate, would she have the votes up on capitol hill to do that without democratic majorities in both the house and senate, that would seem to be very difficult for her to do. but nonetheless, it's a signal of intent here from kamala harris saying that she would push for that 28% rate. scott, back over to you.

>> thank you. that's our eamon javers as you see outside the united center in chicago. site of the convention. >> stocks climbing yet again, putting the s&p 500 and nasdaq on track for their eighth positive session in a row. their longest winning streak this year. our next guest sees more positive upside. nick colas joins us now. you're pretty positive on these markets here? >> it feels pretty good. feels pretty good. we had a bit of a shuffle two weeks ago, but that volatility has died down and we're reestablishing the same trends we had inial. the cyclicals are leading, the small caps are leading and that's good to see. >> no volatility is going to reemerge? was that a one-time fit? some are suggesting otherwise. >> look, volatility will always be with us in some form. it's never absolutely quiet. august tends to be one of those months where volatility peaks out for the year. it's about twice as likely to peak out in august as a typical month in the year. we have seen a big volatility

swing. that was probably the peak for volatility. are we going to get more? we always do, but nothing on the order we saw two mondays ago. >> what about jackson hole? the market seems to be expecting a lot from the fed here forward. what's the risk in that? >> you're right. there are pretty high expectations. we went back and looked at how the markets perform around jackson hole. the week before the fed chair speaks and the week after, and we found markets tend to rally through both, but they definitely wait toward the back end. markets do better after the speech, after they hear what they need to hear from the fed chair, so the returns tend to be skewed toward next week versus this week. i think we'll see the same pattern now. powell should bless a 25 basis point cut in september. at least in principle. that's what markets want to hear right now. >> but that's gault to be already in the markets, right? is that enough? >> it's funny. you would definitely think so because that's what the chatter is and that's what the fed funds

futures indicate. there's always uncertainty around these speeches. that's why the market tends to trade up a little bit into them and more after them, because they want to hear the words and want to hear how it's said. i would say 60% of it is in the market right now, but the market still wants to hear the words. that's what woe should hear on friday. >> you like cyclical stocks, correct? >> yes. >> why so? >> right now, i think we're in what we would call a midcycle market. a part of the economy where it's expanding, where there's no obvious recession risks in the offing. the fed is about to begin reducing interest rates. if you go back to every midcycle market from the 1980s to now, four groups tend to trade off leadership over the course of a midcycle rally which can last years. the growth side, it's health care, defensive, and technology is more offensively. and then cyclicals tend to be financials and industrials. those four groups trade leadership back and forth over the course of years. we saw the tech rally happen in

the first half of the year, supercharges by ai, and now we're seeing the cyclical rally with financials and industrials rally. that's true for large caps and small caps. we're seeing the same leadership against ranges which confirms what we're looking at is correct. >> yeah, but you say that the economy is expanding, which okay, it is. it's not contracting. but it's slowing. the numbers are kind of undeniable in that sense, which is why some figure we're in late cycle, not mid. how do you respond to that? >> look, midcycles are not painless rallies. this happens every midcycle. i have seen every midcycle since the '80s, and it always happens this way. you get a period of growth and then there's concerns. but you need a true catalyst to end the cycle. for 1990, it was the gulf war won. in 2008, the financial crisis. in 2020, the pandemic crisis.

you need a clear and present catalyst to truly end the cycle once and for all. i do agree they're slowing but that happens every midcycle. we have periods of better and slower growth. we shouldn't freak out and worry it's the end of the cycle because we have a few weak data points. >> no, but i phene if you think recession is possible in the next, let's say, 12 months, that doesn't necessarily portend a midcycle market, does it? >> it doesn't, but again, you have to pick up on what is the catalyst, the call behind the recession call? because we're going to have the fed lowering rates. we still have as we saw last week, strong retail sales demand. we track weekly gasoline consumption. that's still good, up year over year. there's plenty of positive points as well as negative points. i'm not overly worried we get a slowdown that results in a recession. are we getting a slowdown? absolutely. labor markets are slower, but

they're normalizing after a really long period of way above average growth. >> lastly, you like small caps as a result of that view? >> yes, small caps are always a trade to us. never an investment. long small caps for ten years but there are periods where they work. this is one of those periods, particularly because high yield spreads blew out two weeks ago and they hovered around high levels for two days. now they're coming back down again. small cap stocks rely on access to affordable capital in order to complete their growth plans. when the spreads decline which they're doing now, you should see small caps continue to outperform. that was the pattern in july. >> we'll talk to you soon. thank you. up next, tracking the biggest movers as we head into the close. >> well, pc problems are putting one tech stock under pressure today. we have all the details coming up next.

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less than 15 from the bell. let's get back to pippa stevens for the stocks she's watching. >> shares of hp are moving lower after morgan stanley cut the stock to equal weight saying there's limited upside to full year estimates given the pc market recovery is now largely priced in. and fubo tv soaring as much as

53% as one point, rallied after a judge's ruling that temporarily blocked sports treming service venue from launching. fubo had argued the streaming service was anti-competitive. for more, don't miss fubo's ceo and founder coming up on closing bell overtime. scott. >> pippa, thank you. palo alto shares are up 30% from their february lows. we get to setup for earnings in overtime. "closing bell" back right after this.

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coming up next, the pros can cons of apple's ai push. one analyst saying shares are stretched from the hype. we'll dig into that call when we take you inside the market zone next.

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we're now in the closing bell market zone. mike santoli here to break down these crucial moments of the trading day, plus steve kovac on why moffettnathanson said why why any apple win may not be a boon for the stock. michael, i turn to you first. this is for the bulls a good way to start the week. broad based and higher. >> market is definitely back in gear. shallow morning dips immediately get bought. you have this kind of levitation type move. not really aggressive. high volatility buying. it's sort of filling an upside air pocket left by the mini panic a couple weeks ago. we still have more than we had before a good news is good news market which of course means bad news probably isn't easably shaken off if we start to get something that makes us doubt

the expansion is going to continue here for a little while. not yet super overbought in the short term, getting there. eight straight days up is not common. but definitely not yet getting too stretched in the short term. we did reload. we're back just over a percent from the all time highs. it's hard to find fault with how the market is absorbed this after this stress test. i think the question is going to ultimately become, once we start to fill in the blanks on the macro, can we hang on to it? >> i'll come back to you in a second. i guess, steve kovac, ai is not going to be a great boon for apple. at least according to certain analysts. >> this is moffettnathanson note this morning, kind of initiating coverage and basically agreeing with wall street's basic thesis that apple's ai will drive upgrades but still rating the stock as neutral, saying all that bullishness has largely been baked into the stock by now. the price target over at mo

moffettnathanson is implying 6% lower from friday's close, that would be $211. and also talking about some of the risks that are going on with the stock, main ly on the regulatory front. you have the doj case against google which puts at risk up to $19 billion in payments that google makes to apple. also at risk is the services division in europe because of the digital markets act. by the way, epic games just launched there, and over here in the u.s., it's the department of justice' antitrust case against apple targeting the app store, messaging, and so much more. still plenty of optimism on ai in general in this report, and as far as the things that are already baked in according to the report today, they need the iphone 15 pro or better to work with artificial intelligence. and by the way, also saying apple is spending far less on captual expenditures as a percentage of revenue, just 2.5% compared to the more than 20% for meta and microsoft. also a survey saying 51% of

folks want to use apple's siri, far outperforming the assistance from google or ai. it's going to be months before we have the answer as to whether or not this is an ai-driven upgrade cycle for the iphone. >> good stuff. thank you. kate rogers now on what to expect from palo alto. those earnings coming in overtime. >> that's right, the street is looking for eps of $1.41 adjusted on revenues of $2.16 billion for the quarter. they expect them at about the midpoint of guidance for palo alto. one area of focus will be the strategy. investors wanting any details on the success of its platform strategy across different geographies and in addition, any impact or billings or customers wins from the crowdstrike outage. its cybersecurity product is going to be used by slb, formerly known as schlumberger. and don't miss mad money tonight when palo alto's ceo sits down

for an cnbc exclusive. >> thank you. that's kate rogers. mike, we'll come back to you with just about a minute left. the bullish thesis sort of is momentum traders plus buybacks, now they have to think about the black out period is over. plus, jackson hole, further setting the table for cuts. that's enough. that's all you need. >> i would say so. certainly, it would check off the boxes of the known things that had been bothering the market for a little while. there's no doubt about that a lot of selling happened in a concentrated period of time. you had this, you know, i think routine pullback, sometimes you need a proper scare before you can really get kind of stick as a good low. we have seemed to have gotten that two weeks ago on monday. again, 1% from the all-time highs. i still think you're going to have a mission accomplished moment at that point if we get there. i do think that at this point, slow and steady fed easing path, still what we want. we see if that's going to get out of powell in terms of the

indications on friday. >> we go out on the highs, just about there today. just shy of 41,000 on the dow, 220ish. bell is ringing. don't forget, palo alto earnings in o.t. >> that bell marks the end of regulation. the new york city fire department ringing the closing bell at the new york stock exchange. they know how to do that. simm acquisition corp doing the honors, and the s&p 500 and nasdaq matching eight straight winning sessions ahead of a big week of fed speak and a rush of retail earnings, the s&p closing above 5600 again. that is the scorecard on wall street, but winners stay late. welcome to closing bell overtime. morgan brennan is off today. we have a big show coming your way. amd ce