target there. jefferies also binging on a bullish third quarter preview. bar clay's warning streaming ad monetization could be a bumpy ride however. netflix lower today but up nearly 100% in the past year. >> even at this valuation, the market is underestimated the potential for even margin growth over the next few years over licensing agreements, which is another example showing the strength of their business model moving forward. i'm long. >> david, thank you very much. have a great weekend. thank you. and thank you for watching "power lunch." you can have a great weekend, too. >> i think it's happy canadian thanksgiving this weekend. correct me if i'm wrong. >> and yom piper as well. >> thanks for watching "power lunch." "closing bell" starts right now. thank you so much. welcome in to "closing bell." i'm scott wapner live from post nine. and this make or break hour

begins with streaking stocks which are about to notch their fifth straight week of gains. just as earning season gets started, we'll ask our experts what the weeks ahead are likely to hold for your money including tom lee, he'll join us in a moment. lots of questions about the future path of rate cuts. on that note, the former cleveland fed president, loretta mester, will be here as well with her outlook. let's check the scorecard. there it is with 60 minutes to go in this week, strong bank earnings. a good ppi report. sent stocks higher today. we're on track for record closes yet again. goldman hitting a new high today. elsewhere, two stocks moving in opposite directions but on the same story. tesla is lower after its robotaxi event failed to wow the street, at least most on it. uber rising on those developments too. there's uber up 11% today. it does take us to our talk of the tape, the bull run which marks its two-year anniversary tomorrow. let's welcome in tom lee, head of research, also a cnbc

contributor. it's good to see you onback, to. >> great to see you. >> i led in with the fact we have this streak going for stocks. above 5800 for the s&p for the first time ever, though it seems to me from your notes that you're a little bit cautious as this month progresses. why? >> well, scott, we're cautious but we advised our clients to be buying the dips. and the reason we're cautious is that, and i'm probably saying something very obvious, but i think investors want to see how, who ends up becoming president after election day. i think we are in a period where markets are just sitting on the sidelines. but at the same time, 2024 has been such a strong year, scott, that i think the last two weeks have proven that maybe macro is picking a little bit of a step back now and liquidity and all

this cash on the sidelines is really the dominant factor. >> you think we just have to get the election out of the way and then it sort of clears the way for what you still think can be a decent rally. i think your target is 6,000 or around that? >> yeah, scott, there's a lot of firepower supporting stocks post election because we have got a fed that's dovish and the economy looks healthy. i don't think we're in a recession. so the three-month and six-month outlooks are strong for stocks and i think china, while there may be some hesitation, china's government is starting to unleash some measures and that's supportive of that region finally turning. and of course, the third factor is i think after two years investors who have been very cautious are starting to realize the $6 trillion in cash on the sidelines and the low levels of margin debt need to be put to work at a time when the fed is supporting themy. >> the other possible head winds

i think are the ones outside of the political cycle, at least as people refer to them. valuations, they say, are too rich. or stretched, right? the s&p is about 21 1/2. that's above its historical average. yields are up. you could make the argument they're up for the right reason but i think they're still up a little more than people thought they might be after the fed did its 50. and then if the fed is going to be slower and smaller in the way they progress with rate cuts, is that an issue? of course, the flip side of that is, well, why would they need to do anything anymore anyway because the economy is as resilient as you just suggested it is. >> on all those points, on valuation, i know people use the aggregate number for the s&p but it's misleading because we know the top seven stocks have a higher deserve multiple and the median pe is not that much cheaper but around 18 times. that's not abad deal considering the ten-year yield

is a 25 p.e., and with regard to the fed cuts possibly slowing, you know, i think what really matters now is the fed is on a path to essentially normalize interest rates back towards neutral because the inflation pressures are ebbing. i think even cpi this week, even though it was a little hotter than expected, didn't send a signal that inflation is reaccelerating so the fed is on a path towards 3%, and i think that's really constructive for stocks. >> let's say we can all kind of come to agreement, because i think we could say that the consensus is bullish at this point. people think stocks are going to go higher from here because the economy and rate cuts. the principle disagreement among the crowd at this point appears to be where. where do you need to be positioned to take advantage of a market that looks like it really wants to go higher? you obviously have suggested that small caps could have the opportunity to have the biggest jump between now and the end of the year.

that's a controversial view because yields are elevated, if the economy is slowing at least a bit, there are questions around it, maybe the stocks don't do as well. i thought it was interesting, the thoughtful commentary that ricky sandler put forth on social media to where he says the best place to play offense, and he thinks you should play offense, are in below mega cap companies that have interesting stories at midto large cap, and he doesn't say small. how would you argue your point against those? >> i mean, i would say that we're on the same side of that line, which is market breadth is expanding, and he sees a better risk/reward in mid to large just because i think there are some reasons. there's an argument that maybe you can find higher quality and longer histories.

but i think that small caps really do perform when the market is believing we're having a soft landing. i don't think that they can make that case in their mind yet until after election day, whether or not harris or trump is president. but i think once we're through that period, i think small caps not only have underperformance as a tailwind, but it's really, and i know i'm repeating myself, but median p.e. of small cap stocks 10.7 times, it's like seven turns cheaper, we're already looking at third quarter earnings growth of 43% versus around under double digits for s&p so you're getting better growth, but i think small caps probably do better if trump wins because of potential for deregulation in m&a. that's why election day probably is a pivot point for small caps. >> would you agree with mr. sandler that the market at the index level is both

expensive and consensus? and that's why, you know, he has the urge to look elsewhere? mega caps are underperforming or at least the nasdaq is today, and maybe that's how the story is going to end up playing out for at least two of those reasons that he mentions. >> i think if someone thinks pes mark the top of stocks, then people are cautious. to me, the pe is rising because the u.s. economy and companies survived a stress test. we had a pandemic, we had global trade stop, we had a huge inflation cycle. the fed, the fastest rate hikes in history. four things have bombarded corporate earnings and companies are producing record profits. to me, they survived a stress test that warrants higher multiples. i just don't think 20 times for a category leading company is expensive, even 25 times. if you're talking about nvidia,

you know, i don't know, sure, the cap should be 30. so i think that we have this uncomfortableness because pes are rising but companies have really survived it. four cataclysmic stress tests. >> broaden the conversation. let's welcome in some guests. shannon, laurie are with us today. it's great to have you both with us. laurie, you're reasonably cautious on this market. your year end target is below where we are today. why? >> we do five different models to come up with our target and a couple of those did go up to 5800. 5700 is the median essentially. we did feel neutral in the short term. a lot of stuff that tom talked about, getting through the election, we see a pullback prior to the election. we haven't gotten that yet for october. i think valuations feel a little full for the here and now. when i fast forward into 2025

and run my valuation numbers and we bake in more fed cuts, get ten-year yields down more, our modeling suggests you can get to a 23 times trailing pe. if you use my earnings, that gets you to 6200 on the s&p. 6500 if you bake in consensus earnings. i still feel reasonably constructive over a longer period of time, but right now, we feel like we're where we deserve to be and sentiment is a little stretched. >> you think it could be a little tactically messy between now and the end of the year as the election takes center stage? >> that's a perfect way to put it. i tell people, we can't live in the tails and maybe i'm a little too guilty of doing that right now, but we do think there's a lot of uncertainty related to this election. one thing i hear from investors is what if we don't have a resolution sooner rather than later? not saying it has to be decided the next morning, but there are some concerns about what awaits us on the other side. if you even look back to 2000 when the case got kicked up to

the supreme court, that's one time in recent history where we didn't get our typical post election pop. >> sam, what about that? the market has this incredible tunnel vision, it seems. it doesn't seem to be too worried about what might happen with the election today, but obviously, as we get closer, it's going to focus more heavily on what it believes the outcome might be, and thus what sectors and stocks are going to possibly perform better in the months ahead. how are you thinking about those issues that laurie so well articulated? >> i don't disagree. we have that one particular example of uncertainty leading to significant weakness in terms of the market trading in 2000. i think the most important thing we're looking at, though, is we talk a lot about the differences between the two candidates. i think it's important to focus on the similarities. if you think about things like deglobalization, if you think about the protection of certain

important industries, the chips act, infrastructure, inflation reduction act. there are parts of those spending bills that will continue for many years to be stimulative to the economy. so i think in this shorter term positioning, of course, you're going to be looking at what does it mean for health care companies, for energy, for defense? but i think more importantly is looking to some of those similarities and understanding that you can capture opportunity going into 2025 on those areas of similarity that frankly are unlikely to be upset by either candidate. i do agree that we'll see some uncertainty if we don't get the answer quickly in the days following the election. but in terms of seasonality, we have kind of blown those comparisons out of the water with september already. we should be geared up for something perhaps a little different than what we have seen historically. >> laurie, what about rate cuts? there's, i feel like the market

has like 1 1/2 feet on the idea of resetting expectations thoroughly now as we move forward. i don't know that we're all the way there, but ed gar denny sat in the chair yesterday and said one and done. he doesn't think they're going to go even more this year. bostick yesterday was on the tape, said yeah, if the data suggested it, i could be totally comfortable with not going again right now. >> i'll go back to my valuation model. i can only really make the math work to get us higher if i get in a decent number of cuts next year. as i house, rbc has not been looking for a series of 50s. we were in the 25 camp, which was obviously a very divisive meeting, but i think in general, whether i'm talking to hedge funds, to long onlies, they have been anticipating significant interest rate relief. if you even go back and listen to companies and what they have been talking about the last few quarters, how many times have we heard about the cumulative

impact of inflation and uncertainty over interest rate policy as something that is not only restraining consumers but corporations and their business activity decisions. i really think we just can't sit here and keep debating. we need to know the outcome of this election. we need to know what the fed is going to do that they're on a particular path or we'll see this paralysis in corporate america get worse. >> tom, rate cuts justifying the multiple of the market. laurie makes a good point. it's like if you were justifying the valuation before based on the number of cuts you thought we were going to have and the size of them, and then those don't live up to that expectation, then how can you justify the multiple being where it is? >> well, i think maybe if we step back, we never know what's priced into stocks, so i think it's hard to say how many cuts were priced into the equity market multiple.

i think stocks are being supported because there is a lot of cash on the sidelines, scott. i mean, i just think a simple thing to point out is margin debt is like $730 billion or something right now, it was $936 billion in october 2021. so in the last if you months, margin debt has been flat, actually, it declined. there's less money buying stocks but they're being supported, i think because they're being bid. i don't know how many cuts were priced into the pe. there's so much that gets priced into why stocks are where they are. >> something has to give, though. i mean, at some point. earnings have to live up to a higher expectation potentially if you're not going to get the cuts you might have thought you were going to get in order to justify the multiple that stocks are trading at, don't you think?

>> true. one thing we have to keep in mind is there is excess interest rate cost in the economy right now because the mortgage, the 30-year mortgage should only be 1.7 percentage points higher than the ten-year yield. it should be at 5.7. i think it hit 6.7 this week. we know credit card debt is going to get cheaper and auto loans and small business borrowing costs and home equity lines of credit as the fed cuts. this is going to unleash not only ease financial burdens but unleash pent-up demand. look at the ism. companies have been cautious for two years. if companies are cautious for two years, it's not as if the economy grinds to a halt. it's now two years of pent-up demand that has to be normalized. that's why earnings could really do well next year. >> shannon, you agree with tom, and i think laurie agrees with both, that it's these other non-mag seven areas of the market and if you want to go all

the way down to small caps, you could put those in the groups you think will be the outperformers moving forward. >> yeah, higher credit growth, scott. we're talking about lower interest rate, talking about stabilizing inflaltion, tom mad an excellent point earlier on the relative valuation. can i go back and talk about positioning? you asked about the multiple of the market. and laurie talked about what's happening about the path of interest rate cuts. there's a lot of volatility in the bond market, in the yield curve, but what is pretty certain is rates on the short end of the curve are coming down. i would say as long as we continue to have this data dependency, this whipsawing from meeting to meeting in terms of expectations for the fed, how many rate cuts will we have, what does that look like for 2025, that actually support positioning and flows into the equity market despite the valuation because there are other factors in terms of the

boost the underlying earnings from a resilient economy, better credit growth, lower cost, lower rates. that supports this outsized multiple as cash is coming out of the short end of the curve. >> that is kind of rick reader's point when he was sitting with me recently. look, the market is stretched, but, and i'm uncomfortable to be bullish here, but there's so much money around that it's really hard not to be. >> i totally sympathize with that, and again, i don't feel bearish longer term. i would say though tactically when i hear the word positioning, the hairs on the back of my neck go up. if you look at aai net bulls we have been hovering around the 1 standard deviation mark. that's where in recent years we have these 5 to 10% draw downs if you look at the cftc data that comes out every friday, it's been just climbing higher and higher and higher for s&p

contracts, for nasdaq contracts. it's been bumping up against historical highs. those are charts when i talk to my clients in meetings we all sort of agree, they keep you up at night. the positioning does feel a bit stretched. even if you want to look at federal reserve flow of funds data, they're sitting up around peak, so i absolutely understand and sympathize with the idea of where else are you going to go when things still look okay, but we are at the same time hitting tactically concerning pressure points. >> tony pascarella, i have cited him often too. he's a friday note drop guy and he talks about the flow of capital tips the scale in favor of the bulls. i appreciate the conversation. thanks for being here. shannon, thanks. tom lee, be good. we'll see you soon. let's send it to pippa stevens for a look at the biggest names. >> kinder morgan is at its highest level since 2015. the firm says the rise of

ai-driven power demand and electrification should provide a boost for the company whose pipes serve many data center hubs, and fast anall shares are the best performer on the nasdaq 100. the daily sales rate in the quarter was impacted by hurricane helene. those shares up 10%. scott. >> all right, pippa, thank you. that's pippa stevens. we're just getting started on "closing bell." up next, driverless or dir direct directionless? tesla shares are falling after the robotaxi event left investors seemingly wanting more. dan ives is here to defend his bull case. lots are making the bear case today. not that gentleman right there. he's here at the new york stock exchange. llear from him next on "closing bell."

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today after its robotaxi event

underwhelmed investors. several analysts notes calling it, quote, disappointing. my next guest disagrees. said the event was a glimpse of the future and the next generation transportation. joining me is dan ives. you say you left that event in which you were there in person, more bullish on this story. how? >> i mean, it's all about -- clearly, details were obviously scarce, and that's partially why the stock is down. in terms of the cybercab, in terms of what we saw, what's really going to be over the next 18 to 24 months, you look at optmous, in terms of what i view robotics. right now, there's no value for it in the story. i think most importantly in terms of the unsupervised fsd that's going to really be rolled out through all the tesla models, at least california and texas, into next year. i think that's why to me i'm not talking in the next quarter as moving the needle but in terms

of the next few years i believe it's a game changer to the broader story. >> you saw what might be, not what is. and there really is no real idea of when exactly this is actually going to hit the street. you want to take a shot at that? >> in terms of price per mile, i think the big focus was could they get under 50 cents. musk talked about 20 cents per mile, potentially with taxes 30 or 40 cents. when you look at cybercab, clearly, the two-person cybercab, this is something where as this goes through the next three to four years, there is no reason this can't ultimately be 10, 15, 20% overall profits for tesla as this all ramps up, given what our view of the overall ridesharing market and what can gain. and it comes down to 1.5 miles driven. >> so the stock had a significant move on anticipation of this event.

the event to many underwhelmed. therefore, not justifying the multiple that the stock has expanded to. that's jpmorgan's note today. they see substantial risk of multiple compression after the big rally into what they call an underwhelming day. >> i think we look back at last night three, four years from now as a historical moment. and the reason -- >> because they held an event and showed you these prototypes? >> sure, it's more than prototypes because ultimately the next leg of the story in terms of autonomous, i believe they will be a clear leader in broader autonomous and it shows now when you look at cybercab, that's just one piece. i think the other reason the stock is down is model 2, lower cost vehicle, they didn't show it. i think they're not going to show, we never expected them to show that at the event. i still believe that's the 2025

story. i think broader you look at demand stabilizing, a robust china quarter. i think cogs is going to come down. you have model 2 or 2.5 in 2025. then when i look at the future, next two or three years, you look at cybercab, you look at some of the parts, i argue the ai story. it is the most undervalued ai name in the market in my opinion. >> i understand, but i'm trying to get my arms around how you're trying to value a stock based on some level of identifiable fundamentals. are you telling me that you came away from that event last night satisfied with the details that you got? because your colleagues at other places were not. adam jonas, that's it? disappointing lack of detail. toni sacconaghi, stunningly

absent in detail. wells fargo, little substance. are you telling me that you were fulfilled in the detail that you learned? >> no, we called out, details are skaers. that was a negative. we wanted more details. but to me, with musk and tesla in an event like that, you're maybe not going to get as many details right there as you would want. but the reason we came out so positive in terms of the test drives and if you look at cybercab and look now at production, this is real. we're not talking prototype. 2026, they start to produce this. we go into next year, this starts to become more more of a reality. it all comes down to fsd. fsd penetration increases within tesla, the story massively changes. >> when do you need more details? when do you sit back and say, you know what, i have given the benefit of the doubt on this story where as many of the others who covered the stock

have not. when do you want details? >> i think by later this year, early next year, you basically need to have some details on when the lower cost vehicle is coming out, what production looks like. what in terms of cybercab and overall fsd, what the rollout is going to look like throughout 2025, and most importantly, cogs. because the whole goal here is that tesla is going to be able to decrease cogs significantly, especially with the next gen platform. if that happens, then you look at numbers into the next year and two, i think they're underestimated by 40, 50%. that's what we need to see. if we sit here six months from now and they didn't give us that, at that point, you probably do have to re-evaluate things. but i think they have a lot more coming than they ever have in the story f i think back the last few years. >> how are you thinking lastly about musk's further leap forward into politics? >> sure. >> and what certainly seems to

be a lack of care, if, you know, half the people who are not supporting the candidate that he is, or whatever the number is, you know what my point is, refuse to buy any of the products that this man is selling in the future? have you assessed any level of political risk that is out there at all? >> look, the political lisk is amplified relative to what it's been. he's obviously, as he's become more and more vocal in terms of trump, that's definitely, there is a negative impact there, but our view is that musk is musk. and we have all seen, he's never going to change. i believe it's a contained impact as of now. in terms of from a demand perspective. if we sit here 6, 12, 18 months and it continues at this pace, then it becomes more detrimental to the story. >> this isn't even a question or

a suggestion. and i want to make that clear, that something has to change. i'm saying, he is obviously comfortable with having a louder voice in the political discourse. okay. by virtue of that discourse, which is, i think we can fairly say somewhat deteriorating in this country, that undoubtedly, there are going to be poem on the other side of the political aisle who don't agree with him who may have considered a tesla in the past who might not now. at what point do you factor that into anything meaningful, material? >> that's why we do surveys. we do our u.s. consumer surveys and that starts to become more and more of a pronounced optic, then you start to get concerned. especially as you're launching more and more new vehicles. if you look at where it is today, that's not really been the biggest issue for tesla. it's really been china and china is starting to rebound.

for musk right now, it is a tightrope. this is a key. this is a fork in the road period the next 12 to 18 months. >> what's a tightrope? >> it's a tightrope between you have the political situation in terms of the way that he's navigating that. >> he's not navigating it. he's not walking it like a tightrope. he's decided this is where he wants to be. it is what it is. >> and the tightrope is you have all these new products. you basically have the next generation of tesla coming forward. the last thing you want right now is anything to spoil that party. last night shows the innovation. that shows the innovation of tesla if you look going forward. i think that's our take. but i get it right now. it comes down now to execution and details. if that happens six months from now, we're looking at a trillion dollar plus market cap in our opinion. >> dan ives, i appreciate it. he's a senior equity research analyst. up next, one and done or brace for more cuts?

ide former cleveland fed present loretta mester is here with her own expectations for central bank policy and this economy moving forward. we're back after this. on growth opportunities.inge pgim investments. shaping tomorrow, today.

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welcome back. the ppi cooling in september, according to the latest data out this morning. this after yesterday's cpi number shows inflation slowing. those data points adding to the questions now over how the fed might move at its november

meeting after the supersized 50 basis point cut in september. here to share her outlook is loretta mester. >> thanks for having me. >> would you have got 50 at the last meeting? >> well, i wasn't at the meeting. >> you're allowed to say now. that's why. >> i am allowed to say. i thought it was a close call. i could have make a case for 50. in retrospect, of course, some of the data they were worried about in terms of the labor market got revised away. i can imagine now in retrospect, they probably imagine they could have gone 25, but the base narrative hasn't changed much with the basic data we have gotten on both employment and inflation. i think the basic narrative is the same, which is, you know, over the next six months, seven months, eight months, the median run outlook, they expect inflation to continue to move down at a gradual pace and they want to do what they can to keep

the labor markets healthy. and while there's probably a little more strength in the economy than they saw in september, i don't think the narrative would change. some of the risks have changed around that, of course. i think there's less downside risk on the employment front than they saw in september. but i also think there's probably a little more upside risk on the inflation front than maybe they were expecting. so i don't think the basic idea of, you know, we're trying to move rates to a more neutral stance overtime has changed. and i would expect that that would be sort of what they discuss at the meeting going forward, which is, you know, has something materially changed that we want to really move off of that phase of normalizing rates. and i don't see it in the data right now. i think the data is pretty compelling that it's about what they expected, a little more strength on the employment side, which is a good thing, i think. less downside risk there, and inflation moving but moving

gradually back to 2%. remember, in their forecast, the median forecast didn't have inflation reaching 2% in next year, so it's basically on track, i think, with that kind of slow, gradual, but more confident on track to get back to 2%. >> i want to ask you about the median projections and the forward guidance and all of that because some are taking issue with it to begin with. there's stan druckenmiller who is one of the most famous and successful investors this country has ever seen who said, quote, i hope the fed is not trapped by forward guidance the way they were in 2011. i mean, larry summers made the point after the jobs report following 50 basis points, which he thought, by the way, was a mistake, to where he said, quote, today's employment report confirms suspicions we're in a high neutral rate environment where responsible monetary policy requires caution and rate

cutting. how would you assess what both of these well respected economy and market watchers have said? >> yeah, so i do believe that probably interest rates and neutral rate is higher than it was in 2014 through 2019. i think there's a lot of reason to believe that. but you know, the fed rate, the funds rate is high relative to where inflation has come down to. so in other words, if you don't move rates down gradually, you will be inadvertently tightening. given where the economy is and where inflation is relative to goal, i don't think that's necessarily appropriate. but they're right in the sense that you always want to keep your monetary calibrated to the economy. and where it is, but also where it's going. so i think there's still room to do some cuts in a gradual way. you know, next meeting, the following meeting. and before you get into that realm where okay, we don't really know where neutral is,

maybe we need to sort of being more gradual than we have been. so yeah, we'll get to that point, but when we get down to 4, 3.75, that's where you have to sort of be cautious because we don't know exactly where neutral is. and you'll let the economy tell you sort of how it's behaving and that will give you some good clues about are you getting to a point where it really does seem that you have settled in to price stability at 2% inflation and maximum employment, where maximum employment is the employment that's consistent with price stability. i think the economy is going to tell them, but there's still room to go before you get into that area, i would say. >> but i mean, when some suggest, well, they should move, forget the economy. they're just too restrictive. others find that argument silly. and they point to the fact that i'm sitting here saying that the s&p 500 is over 5800, where a

record high on the s&p and the dow and the economy is still strong, the labor market bears that out. so to that argument that the fed is just too restrictive, how do you respond to the critics that say it can't possibly be given the environment that we still are talking about? >> remember, it's not only about where the economy currently is. it's where the economy is going over the median run. so when you look at a median run forecast, their forecast, and we'll use the s&p because that's the best we have, they don't have a consensus forecast yet. i don't know whether they ever will get there, but we can talk about that another time. they basically see, right, still positive growth and growth above trend, according to their forecast over the next two years. and then, the unemployment rate moving up only a little bit but towards where they think an average unemployment rate should be over the long run, so full

employment and inflation gradually moving down. that's where they're calibrating their policy toward. as the economy evolves, they have to think, is the data coming inconsistent with that or not consistent with that, but they have to be more forward looking than the markets are. if they wait too long to do something, then they get behind and that causes the problems we had when we were raising rates and that we probably waited too long to do that, and then we had to raise them aggressively. >> when you say they need to be -- i'm sorry to interruptd. when you say they need to be more forward looking, are you suggesting they're too data dependent? >> no, what they don't want to be is data point dependent. they're not going to move -- the real question is do the data that came in over the last, you know, the past meeting, did that really materially change the median run outlook for the economy. i submit no. i think it might have changed the risk of it, the risk assessment. so i see, you know, instead of

being even risk run inflation, there's probably upside risk to inflation, instead of being, you know, all downside risk of employment or unemployment going up more than you would expect or more than you would want, that's been diminished. so the risk of change, but in terms of the overall outlook for the economy, i don't think that much has changed that it would deter from thinking that it's continuing on this phase of policy where you want to bring rates down from their very high levels to something that's approaching neutral and moving toward a normal level. i think that's the calculus that a policymaker has to think about. if you're in the markets trading, you have a different calculus because your time horizon is much shorter than a fed policymaker's time horizon would be. >> let me ask you lastly before we go, november meeting. do they cut 25? is that what our expectation should be? is that yours? >> if i were there, given the data we have had so far, i would

be 25. i would do it again at 25, partly because i think this stop and go is not a good look for the committee. i think they started this phase of policy because they really have a median run outlook that says the funds rate needs to be brought down more towards neutral. none of the data we have seen has changed that outlook and therefore you want to go again. then as it gets closer to something the range of neutral, and it's a wide range because we don't know exactly where neutral is, then you become more cautious and perhaps you do it slower. >> we'll talk to you soon. thanks for being with us today on "closing bell." >> up next, we track the biggest movers into the close. >> one struggling automaker is shifting gears in hopes of a turnaround. the name to watch coming up next.

. got more than ten minutes before the closing bell. back to pippa stevens. >> stellantis is pulling back after they announced their ceo will leave. they also named new chief operating officers and confirmed that their ceo is slated to leave in early 2026. the c-suite shake-up comes as the stggngruli automaker tries

to stage a turnaround. those shares are down 2%. >> thank you. good weekend to you, pippa stevens. "closing bell" is back after this. when you're looking for answers, it's good to have help. because the right information, at the right time, may make all the difference. at humana, we know that's especially true when you're looking for a medicare supplement insurance plan. that's why we're offering "seven things every medicare supplement should have". it's your free, just for calling the number on your screen. and when you call, a knowledgeable, licensed agent-producer can answer any questions you have and help you choose the plan that's right for you. the call is free. and there's no obligation. you see, medicare covers only about 80% of your part b medical expenses. the rest is up to you. that's why so many people purchase medicare supplement insurance plans like those offered by humana. they're designed

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we're heading to los angeles on tuesday for the case alternatives conference. we're going to hear about the top opportunities outside of stocks and bonds. growing interest and private equity and credit and so much more with the leaders in the also bins,ueuses tsday on halftime report and "closing bell," bunch of exclusives.

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react to fast-moving markets with dynamic charting and a futures ladder that lets you place, flatten, or reverse orders so you won't miss an opportunity. e*trade from morgan stanley we're in the market zone. cnbc senior markets commentator mike santoli here to break down the crucial moments of the trading day. we're going to have record highs again. >> the market has struggled to find anything to really worry about in the new data, in obviously banks. people were maybe not giving them enough credit for the data, at least initially. there was also a breakout to the two-year high in the bank sector

that i think has this chase mode. so many people, and look, i understand why, were entering october saying there is no rush to do much here because you're going to expect some downside chop. you have a lot of hedging going on, and the market is not making people feel comfortable with being underinvested. i don't think a lot of people are underinvested but they might feel as if the market could get away from them a little bit. some of the weakest stocks on a year to date basis up substantially this week. it feels like the market is searching for hated stuff or things where people are underexposed, walgreens, intel, lulu up way more. >> the russell is by far and away the story today. up 2%. we're able to get back above the 2200 number, which has been the line, and you have been talking about that for so long. >> that would go into that category of people who have this skepticism on. the market is almost trying to

punish some prudence in the short term as does sometimes happen. it's getting a little stretched on a shortterm basis. it mostly prices in a good scenario. earnings probably going to come in fine, saying if we beat by the normal amount, it would be 7% growth annually. that's not bad. the multiple to stay supported, the other piece i keep pointing to is the differentiation among the mega caps. it's not monolithic. you have winners versus losers. tesla is go down double digits today. microsoft can fall asleep for months as it has, and the index can hang in. >> i'm looking at nvidia, obviously a story of the week, up 8%. and uber getting the reverse of the tesla sell-off today. >> it's sort of remarkable. again, i feel like i don't know why people would have expected much on an instant reflex move in tesla to the upside, and frankly why you would

necessarily have been that negative on uber as being threatened by it, but obviously, the was a lot of tactical money that was laid that way. you don't get these kinds of moves otherwise. again, i want to point out, i don't think people hate this market. the positioning data say people are in. but it is just sort of like if credit conditions are what they are, the market is not acting like a recession is close by. if you don't get a recession and the fed is cutting, it's hard for the market to get into bad trouble. >> you have a great weekend. all of you as well. dow is going to be about a 400-point winner today. new high, s&p. new high going to close above 5800. everybody, good weekend. into overtime with morgan. >> that's the end of regulation. sarahbell doing the honors at the nasdaq. we got them record closing highs for both t