>> welcome to this early edition of closing bell. this make or break our starts with another month in the books with the numbers printed in green. stocks capping november with a record in a shortened post- holiday session. here is the scorecard with 60 minutes left in regulation, s&p 500 levitating to what would be the 53rd all-time high of the year, .65% right now.

you see the dow above 45,000 will be the first close above that level. the nasdaq is outperforming by a bit. for a bit of a change, adding 9/10 of 1%, semiconductors and bounce back mode, they have been a drag on the big cap indexes and they are nicely today. yields pulling back further, challenging levels, the tenure retreating to about 4.2%, perhaps helped by reallocation into bonds after that asset class has lagged. our talk of the tape, with the s&p 500 up 26% for 2024, year- end seasonal factors are favorable and the soft landing debate settled for now in favor of the economic optimism, is there much left to impress investors into next year? tomley -- tom lee joins me.

we can stack up the positives, you have been injured with the idea that the economy would power through an inflation would come down, earnings are going higher, the big question, how do we set expectations for the year coming up? >> it is a great question, we have two back 21st -- back-to- back 20% years, and they wonder how much good news is baking, the 2025 environment is a great set up, we have a new administration coming in that is made from animal spirits, we have a dovish dad, and interest rates calming down. $7 trillion in cash on the sidelines, i think it is a good set up for investors i would not be too worried about the next 12 months. >> donut be very word -- do not be very word, the two 20% of

years in a row, history says, the following year is up more often than not. what do you mean, do you think specifically by the new administration being pro-animal spirits, it is true, it is pulling in that direction, but are there specifichat will drive that dynamic? >> yes, the market is trying to figure out how this animal spirit plays out in the markets. we have a treasury secretary that equity markets approve of. we do note that the last donald trump presidency cared very much about what stock prices do. i think that the uncertainty is around trade and potential risk around tariffs that we will have to see. that is something markets will have to deal with from an uncertainty perspective. >> the way the market has behaved, in the last several weeks, and going into the

election, we need to owner more cyclicals and financial stocks, we will reprice the market for a growth acceleration or maintain above trend growth. meanwhile, only a couple months removed from a growth scare him a job growth has slowed to a point, the housing market seems locked up, interesting how the sentiment has jumped ahead. the economic numbers positioned to validate that view? >> markets tend to be forward- looking and i expect this i know there has been a recession in durable goods and housing and auto sales because of high rates which have made affordability an issue. that is on the come next year. the tenure hopefully behaves. if there is more confidence and more supply, i think housing could lead the recovery and that is why homebuilders are doing better this week.

>> they seem sensitive to yields halting their rise. if we begin it is a supportive environment and pretty much all the things you can identify would suggest we should not be very worried about next year but the second question, is something like the s&p 500 the best vehicle to capitalize on that? >> i think investors are trying to figure this out, we did a survey with institutional investors last week, the majority of institutional investors do not think faang is the biggest trade, the majority are betting on thank, -- faang, i am more cyclicals even on small caps having a big year next year. to small caps are trying, i am looking at the russell 2000, like seven points from the all- time i said about three years ago but outperforming recently. you know the pushback on that,

lower quality, absolute yield levels are not down that much, they have more leverage, and, there is also this idea that we have been promised that they would be the place and maybe they are not. what changes? >> one thing investors have to keep in mind, small caps over 100 years of history they did not only exist the last few years and recency bias makes people bearish. in q3 earnings, small-cap earnings were up over 40% compared to 10% for the s&p. we have never had six years of underperformance in small caps versus the s&p and we are at five years. >> i do keep pointing out that the last time you had this huge reversal higher in small caps versus large caps, also with big growth stocks getting killed in the early 2000. >> i think the growth stocks, because of the 1990s, i was a

technology analyst, adpe was common. >> microsoft got to 60. >> today, people are complaining we have 30 times to seven, i think it has a lot of pe expansion potential and the money will eventually get deployed. >> let's bring in stephanie of robin hood. great to have you. what are your main thoughts? you did think the s&p could get to this on, about 6100, is it fair to expect that much more to be piled on next year? how are you thinking about expectations? >> i am thinking the next three to six months we could get to 6300 on the s&p but i think you can see better returns elsewhere. i do think, with the higher interest rate environment, even

if it comes down a little bit, stays in this range, which could be higher, i do think that means that we have seen most of the returns already from the top 10, the s&p. since the election, you are seeing the s&p top 10 are down about 2.25% and the remaining 490, which makes up two thirds of the index is up 2.5%. i think you will see that continue. my favorite place is made caps. that is why i have been saying that i think we are in a stock pickers market. what i mean, paradigm of owning the s&p 500 and that is all you need to do leaves opportunity on the table for the next three to six months at least. >> fair enough. scott, you have been holding your expectations somewhat in check in terms of what the overall market can deliver. obviously, if you played

quality and participated enough in it, where does that set you up for the final month of the year and into next year max >> you are right, we have talked enough this year to know that stocks are higher than where we thought they were going to in the year. we think the s&p could be near 6600 by the end of 2025, that is good. i think there are opportunities to present themselves because, you look at core pce inflation, not where the fed wants to see it, we have two cut in december, two next year, priced in, but the risk is to the downside. i think that some concerns about inflation, you will probably have some concerns about tariffs . what we are hoping for, we are leaning towards stocks. are we 100% all in leaning towards cyclical stocks? we are not, we could take

another step and we would take another step if we get some kind of a decent pullback. nowadays, if you think about it, over the course of the last 18 months, 12 months, a 10% pullback is, even though common historically, few and far between. we will get some kind of pullback i think and see us take another step. we are optimistic but, the economy will slow down a bit. earnings growth, it will set a record high next year, our earnings will, growth rate will probably slow a little bit. there are some things investors should pay attention to, one, have a plan, if we get a pullback and you have got cash on the sidelines which most retail investors do, you need to be ready to step in and likewise, we think there is a good chance, 10 year yield could be 4.5% by the end of next year because we think there will be more inflation and in the second half of the year economic activity will be better.

i think there will be an opportunity to lock in some longer-term yields and there will be an opportunity to buy stocks at lower levels. we are not ready to be overweight small caps for a couple years we were underweight and overweight large caps, and a lot of people were also and that worked out pretty well. we think it will be a large caps for at least in the first few quarters or maybe longer in 2025. i like the way we are positioned. we are looking for better positioning and to take another step towards a cyclical allocation if we get any kind of pullback. >> you have been focused on the downside momentum and inflation for a while. it has gotten sticky in terms of the official readings recently, scott talking about the risk it perks up again, how does that play out from here? >> i think the fed is comfortable with inflation not going to have a large wave that takes us back to emergency

levels. but these reports, i can quibble with them because the most recent pc report almost 1/4 of the inflation was magazines for the month. is that repeatable? in the last seven years, the highest increase in magazine prices. >> you can usually pick an outlier on a one month basis. the other piece of it i think is maybe more long-lasting has been the fact that portfolio management fees stock market goes up, you impute there is a rise in portfolio management fees, which nobody pays out of pocket, it is one of these funny things, how much do you want to fixate on that? >> the fees come out of your gains, not out of your wallet. that is a great point. consumer expectations of inflation have been stable and that is what matters more to the fed. if the fed cuts one time next year, still a dovish fed,

bullish to give us more fuel. >> you do not want to fit in emergency mode. -- fed in emergency mode. stephanie, what individual investors are doing and how they are prioritizing the movement of their money? it seems as if there has been a rekindling of energy within certain parts of the market, some of these retail trader favorites are flying again. this idea that, obviously, if we are in a higher animal spirits environment, that may run for a while. >> our customers i think, but -- they own core position of things they know and use, some of that does land in the large- cap tech oriented space they

tend to trade around volatility and i think we are in a great environment for that where there is greater dispersion among stocks and our customers should benefit from that. more recently, you have seen them taking a lot of profits in names like tesla, and you have them -- you see them putting money into nvidia because it has not been flying as much as other names. micro strategy has also been a favorite for them. i do think the environment should actually be beneficial for the way we see them behave. they are not selling. >> not selling on a net basis, yes, that does make sense. scott, a final word, stephanie mentions micro strategy, i pointed out that this run in bitcoin and crypto , has created a coattails among some related stocks or high risk,

high reward situations where it seems like hot money is getting excited. is that something you are wary of or you can harness? >> mike, i think, anytime you have seen the stock market move from the october of 2023 lowe's to where it is now, that is a big move in one year, and it does not surprise me that a lot of these other high risk assets have moved up as well. that tells me that, we probably have some more upside in the near-term because there is a lot of momentum in this market. it tells me that we could have, as i mentioned before, some opportunities to take another step. i am not fond of chasing the s&p 500 but industrials, financials, communication services, those sectors look decent and we like energy, when oil is $65 or 70 dollars, which it is, there are some sectors you can do some things in now and those opportunities will

present themselves when people get nervous about the fed and may be nervous about what may happen with tariffs and things like that . we are looking forward to 2025, i think it will be a good year. >> tom, you have been bulllish, bitcoin on an incredible run, what about the round numbers piling up, 100,000 in bitcoin, $6000 on the s&p, 45,000 on the dow, feels like we have the potential for people feeling as if, we made it . is that a problem? >> maybe we are in simulation. i think the fundamental arguments for bitcoin are even stronger now than at the start of the ear as we have gone from huge regulatory headwinds and governments hostile to potential u.s. making this strategic sovereign asset when it is proven itself as a pretty good store value, whether three- year, five-year, 10 year, bitcoin total value is $2

trillion and gold is $19 trillion, bitcoin has a lot of room to rise . >> i will use that as a chance to point out, when we talk about bitcoin fundamentals, we are talking about supply and demand . more people have more ways to buy more of it. >> yes, but then again, that is how you talk about dollars. >> sure. >> the dollar is able to be exchanged for a dollar. >> we will have this discussion again, really appreciate it, everybody have a great weekend and thank you for joining me on this friday go have a look at the biggest names moving into the close. >> shares of advanced automakers or auto-parts down 7% after moody's ratings downgraded the company senior unsecured debt to below investment grade. the credit rating agency said it reflects their expectations over the next 12 to 18 months. the auto-parts retailer is

closing over 700 stores as part of a turnaround plan over the next year or so but no bankruptcy plans yet. hasbro going the opposite direction after elon musk floated the prospect of acquiring the toymaker to secure the rights to dungeons & dragons, elon musk posted this on x after saying xai will start a studio. mike? >> only a $9 billion market cap, only a trifle. thank you. we are just getting started, next, holiday shopping season officially underway which retailers should investors be watching? simeon siegel is with us after the break a live look at the mall of america on this black friday afternoon. you are watching closing bell

on cnbc. hive digital technologies is a first mover in the crypto space. combining sustainable bitcoin mining, strong asset holdings

and a focus on ai and high performance computing data centers join hive in driving digital innovation. hive digital technologies. to go further, you need to be ready for what's down the road. as energy demand continues to rise, we're harnessing breakthrough innovations to increase production in the u.s. gulf of mexico. our latest deepwater development, anchor, produces previously inaccessible oil and natural gas, allowing us to deliver the energy we all need today so everyone can follow their own road. that's energy in progress.

black friday shopping underway, starting early this morning for some let's go to courtney reagan who is live in the garden state plaza in paramus, new jersey. how is the traffic so far? >> reporter: i am always here early at the mall, a tradition, but interesting stuff we are seeing. we have some exclusive real- time spending data, given to us this morning showing, between midnight and 9:00 a.m. , this is real transaction data, brick-and-mortar retail transactions were 4.3% ver the same time last friday, online sales fell 4.4% compared to the same time last year, not entirely surprising. online sales maybe weaker this

morning but that is because online shopping today is supposed to be between 9:00 a.m. and 3:00 p.m. eastern time. before the data was pulled, and a lot of shoppers hit online stores last night. searches for home and kitchen were the biggest increase over last year, up 287%. patio furniture and home goods, lawn and garden, down about 67% year-over-year. we are expecting 132 million consumers or 72% of american will shop on black friday today in some form, online, in-store, or maybe both, 65% of consumers told the national retail federation they would be shopping in on black friday. this mall has only gotten busier since it opened at 7:00 a.m. , a real shame because i was watching some things and i am not excited about those lines.

>> i was going to ask you if there are clusters of lines or crowds in some areas. i figured that is where people have a priority of saying i need to make sure i get that one coveted thing. >> reporter: interesting, but for -- before the malls were open, lulu lemon had the longer line, i found that interesting because you do not often see promotions at lulu women, usually a bit of a clearance rack but not a sale and not storewide. this mall does have other competitors but lulu had the longest line. >> sometimes you get a model size, style of a lulu product your daughter wants you to get. >> give me your shopping list. >> joining me is bmo capital markets top retail analyst,

simeon siegel . good to see you. busy time for you. what are you most eager to learn over the next few days as it bears on your coverage? >> i love that question because we heard courtney particularly give a lot of numbers, that is a skill, i don't know what to do with that, a lot of surveys, a lot of opinions, i was at the garden state mall seeing all these people at 7:00, but we want, what investors want to know, how is the business? it used to be black friday was a great synopsis because that is the only thing that mattered, now, to a point, people are shopping before and after, during, and what i want to know, we are seeing divergence and watching winners and losers, -- >> that dynamic is interesting,

if it was predictable in a sense of, here is a sweet spot from one particular chain that caught a fashion tailwind or normal execution? >> i will tell you what i love, for the better part of the last three or so years, you and i have been talking about great environments and challenging environments, all the macro, everything, it was a cluster, companies were doing well because no inventory and develop stimulus or poorly because they tell of immigrants and no stimulus. that is not what business is, it is marketshare, i am supposed to win at my competitors expense. that is what we are seeing. i don't know that is a fad, we are seeing good operators do well to the beautiful part, companies are selling the exact same things to the same people with different results. michael kors and coach, different resultrt and target, different results. you just talked about lulu. it is a healthy dose of

business competition. >> i like the framing, and investor needs to either take risk that the great companies and retailers are richly valued, take risk on the multiple, or, you have to take risks that the earnings do not come through if somethings look cheap. select thank you to my team, hopefully they did not work very much on thanksgiving, but we did publish a big report today where we were trying to isolate, from my conversations come in this market you have to take risk of multiple and purchase expensive for recent socks or take risk of numbers and purchase turnarounds. what we are trying to do is both, saying, tjx is this compounding business that is wildly expensive but i cannot justify the multiple based on historical. for the entire market, i would say similar things. on the other hand, under armour, businesses people hate. they moved along and said these are dead businesses but they are not dead, they have

billions in revenue but they have to fix profits did you take that, that is a very nice emergence. figuring out, as an investor, do you want to pay for the risk of the multiple essays expensive but a good business? or will you take risk of numbers but don't worry about the multiples. >> the ones used as examples, under armour, brand, some kind of brand profile and you're making a bet it has durability. >> what i love, i am not clever enough to tell you what will be that latest trend hopefully, i can look at what is happening and say the revenues are telling you the truth if everyone -- there was a point not far away not far in the past, people said palatine was broken, -- eleton was broken, if it does not make a lot of money, it can be sick i can fix -- they can fix it but you cannot fix dead. >> are there any of those

companies that are in that paying up for quality category that you think are particularly vulnerable? >> that is interesting, if i hold to my definition, the answer should be no based on the results. yes, based on whether the market moves. i think it is fair to say there are extensive companies, lulu is an expensive stock and they are doing a very exciting disney collaboration, people love disney and love them, this is for you. we have talked about, brands still have peaks, they -- every kid in second grade nose without too much of something, it is not cool. they have to worry they are expensive, a lot of sales, and heavy margins. one of those things falls. there are three potential errors we have to worry about. >> great to talk to you. good perspective and enjoy the weekend. next, ryan dietrich is back

to tell us where he sees the llheinray adg from here on the sectors he is betting on right now. we are back after this break.

(♪♪) ♪ well i was raised by careful hands ♪ ♪ yeah, they made me who i am ♪ ♪ so i'm off to see... ♪ we invent them. we design them. we build them. and one day, we have to let them soar. ♪ i'm always coming home ♪ growing old is part of the journey, even when you have heart failure. but when he had shortness of breath, carpal tunnel syndrome, and lower back pain, we wondered, could these be warning signs of something bigger? thank goodness we called his cardiologist because these were signs of attr-cm, a rare and serious disease... ...that gets worse over time. if you see any of the warning signs, don't wait, ask your cardiologist about attr-cm today.

(♪♪) (♪♪) (♪♪) everyone has goals and dreams. and everyone deserves a way to get there. wherever you're going, getting there starts here. state street. invest in your future with spy, the world's most traded etf.

(♪♪) stocks hitting another record high on the shortened trading date with the s&p 500 closing with the best month of the year. our next guest sees more runway for the rally let's bring in ryan detrick . great to have you on to freshen up your view of what this market can do. in some respects, this market

has been behaving as it is supposed to behave earnings have been going up, stocks have been advancing, seasonal strength has been redeemed, you have the postelection tension release rally. where do you think that leaves us on this -- going into next year? >> thank you for having me back. the friday before the election, talking about the big spike and the puts coming in, we expected another strong november, like you said, we are having a strong november but this year has played out. what do we know about december? we think there is more to go to the overall bull market but, over the next four to five weeks? december is up more likely more than any other month, 74% of the time, most likely to be up in an election year, the third strongest year overall but the second strongest in an election year only to november. when you are up a lot going

into the last month of the year like we are come up 20% or more going back 40 years, 10 times that happened, december has been a higher nine of them up 2.4% on average. better than average returns. it is a bull market. we think there will be a chase into the end of the year. >> that underlines the idea that usually strength begets strength in markets and not something that you pull forward gains and left with give back necessarily. but how are you thinking about things like, sometimes the third year of a bull market, which we are in now, is less generous? first year of a new president's terms is choppy, even years like this year, we will hit the 53rd record high for the s&p, with those clusters of new highs, usually still a bull market but often a little bit more of a turbulent time at some point over the following

year. >> you are right. scott, great discussion, he talked about those other areas taking the baton, small caps, mid-caps, industrials, financials, does not just mean the leader has to be tech. the other thing, i hate to say this time is different, but what is happening? we have strong productivity in the country since the mid to late 1990s and with strong productivity, look at the history books, higher gdp, higher earnings growth, and better stock returns, we gained 20% five year interval in the late 1990s, not saying that will happen again but with the higher productivity like we have seen, reasons to think the bull market is alive and well probably will not gain 20% next

year but between 10% and 15%, closer to 50%, it makes a lot of sense with the strong economy and good productivity. >> if you are talking about strong productivity, goes to the notion of an economic cycle which, for one thing been unusual. we are working on 2.5 years negative leading economic indicators and we have not had a recession yet. on the other hand, something that should give new life to it. i wonder, about the starting point, on that list of positives, tight credit spreads, elevated valuations versus history, the fed will probably be looking to ease but maybe not much. i wonder, what is it out there that has yet to be improved that the market can seize upon as better than expected? >> a couple different things, the overall idea that this broadening out is alive and well. we are getting all-time highs on supply lines and have been for a while. 11 sectors, some of double digits. we did not have that

over the last couple of years with investors realizing the broadening out is there. globally, there are some -- since the start of the -- the end of 2019, u.s. economic growth has grown 12% or 13%, most of europe is flat. china no one trust their data, they have big issues going on. the idea that maybe the rest of the globe starts to do better is something that brings in that diversified portfolio, look around different parts of the globe, we still like the u.s., our favorite area, but maybe better economic growth from the rest of the world is something i don't think people are talking about into next year. >> totally fair. a bit of a contrarian stance if they said they could catch up on the markets that reflect it. thank you very much and have a great weekend. next, we are tracking the biggest movers as we o into the close, christina is here with those.

>> fda refusing to approve a new drug and one name is plunging, details on that and much more coming up next. discovering innovation today, helps drive growth tomorrow. as a leading global asset manager, pgim has established a track record of helping investors capitalize on growth opportunities. pgim investments. shaping tomorrow, today.

it all started with a small business idea. it's a pillow with a speaker in it! that's right craig. pulling in the perfect team to get the job done. i'm just here for the internets. at&t, it's super-fast! you locked us out?! and when thrown a curveball... arrggghh! ahhhh! [crashing sounds] we had everything we needed. is the internet out? don't worry, we have at&t internet back-up. the next level network for small business. ♪♪ i sold a pillow!

drop everything and get some magic of your own during the xfinity black friday sale. xfinity internet customers, our best deals of the year are back!

switch to xfinity mobile and get your choice of a free 5g phone, plus your next unlimited line free for a year. get amazing savings and connect to wifi speeds up to a gig on the go with xfinity mobile. fly don't walk to get our best deals of the year. connect to the world of wicked this holiday, in theaters now. appreciate it so much. thank you. doors are new beginnings. -surprise! -surprise! your dedicated fidelity advisor can help you open those doors. for you, mama. through personalized money management that can evolve with new chapters. and they can proactively view your entire portfolio. with an eye on taxes and the impact of risk. so you can enjoy moments together. because doors were meant to be opened. coming up on 17 minutes until the closing but with the s&p up three quarters of 1%, and record levels. let's get

back to kristina for he stocks to watch . >> reporter: are you ready to start trading stocks until the early morning of the hours in north america? robin hood is climbing after the sec approved the creation of 24-hour stock exchange, paving the way for around-the- clock trading, the stock has been rallying since the election come up more than 60% in november. it was up 1%, almost flat at this point. let's talk about applied therapeutics losing more than two thirds of market cap after the fda declined to approve the drug to treat a rare genetic metabolism -- disease, it would be the first commercial product. they are reviewing the feedback and will fight back and requesting a meeting to discuss requirements for resubmission and that is why you see shares shed their year-to-date gains. down quite a bit today. >> welcome to binary biotech

stock outcomes. kristina, thank you. not just about the mall this black friday, auto dealers trying to win holiday deals. we will see how those companies are doing. a live look at the tiger ts ets in deer park, new york onhiblack friday. closing bell will be right back.

♪ ♪ ♪ (vo) whether your phone's broken or old, we've got you. with verizon, anyone can trade in any phone, any condition. this black friday get iphone 16 pro with apple intelligence, on us. and, ipad and apple watch series 10, all three on us. that's up to $2,000 in value. only on verizon. were you worried the wedding would be too much? nahhhh... (inner monologue) another destination wedding?? we just got back from her sister's in napa. who gets married in napa? my daughter. who gets married someplace more expensive? my other daughter.

cancun! jamaica!! why can't they use my backyard!! with empower, we get all of our financial questions answered. so we don't have to worry. can we get out of here? i thought you'd never ask. join 18 million americans and take control of your financial future with a real time dashboard and real life conversations. empower. what's next. oh, we got a weathertech gift card! weathertech is the perfect gift for everyone. may i? (laughs) laser measured floorliners protect carpet in the front and second row.

cargo liner protects the rear. the side window deflector offers more protection. my turn! the sinkmat contains spills in cabinets. something for you too, buddy! pets eat safely with the non-toxic pet feeding system. find these american made gifts or get a gift card instantly at wt.com. (♪♪) car, this isn't the way home. that's right james, it isn't. car, where are we going? we're here. (♪♪) surprise!!! the future isn't scary. not investing in it is. car, were you in on this? nothing gets by you james. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com get the power of cnbc pro,

join today with exclusive stock tips, central tools for wealth management and more with our special black friday offer go to cnbc.com/prooffer or scan the qr code on the screen next, wilmington trust is standing by to break down the final moments of this holiday shortened trading day. that and much more when we take you inside the market zone.

appreciate it so much. thank you. doors are new beginnings. -surprise! -surprise! your dedicated fidelity advisor can help you open those doors. for you, mama. through personalized money management that can evolve with new chapters. and they can proactively view your entire portfolio. with an eye on taxes and the impact of risk. so you can enjoy moments together. because doors were meant to be opened.

♪♪ well would you look at that? jerry, you've got to see this. i've seen it. trust me, after 15 walks, it gets a little old. ugh. i really should be retired by now. wish i'd invested when i had the chance... to the moon! unbelievable. stop waiting. start investing. e*trade ® from morgan stanley. we are in the closing bell

market zone, meghan shue breaking down crucial moments, and how the auto dealers are doing this by friday, and kristina on what is behind the pop in chip equipment stocks. great to have you join us today. it has been tough to go wrong investing in u.s. equities this year with earnings up and valuations of those earnings also up more than 25% year to date. stocks trounced bonds. where does that leave you as an investor as far as whether to let that ride or make some adjustments? >> thank you for having me. we have made some adjustments and we have to acknowledge that strong gains we have seen and, in our view, if you think about how the market thinks about risk , more often than not, the market price is really more towards one side of the risk spectrum. after the election, we have a lot of euphoria around the positive elements of a donald

trump 2.0 economy. i think that leaves us exposed, given the strength we have seen, given the extended valuation, leaves us more exposed to downside and we have trimmed risk in our portfolio for taking down our small-cap overweight to neutral. not just policy related, we are watching a little bit of weakness in the labor market, specifically labor demand, which is key for the consumer and we know the consumer has been a huge driver of upside surprise to the economy. >> do you think the market has a current blind spot, given it is focused on the upside possibilities, is it mostly about not thinking that the economy will slow materially? i know you think the fed will cut more than perhaps consensus does right now, one of three quarter percentage point next year, because inflation is down solely for the fed will

have to take out some insurance on the economy? >> to clarify, we are not negative, we had a decent overweight to equities, we have taken it down and now slightly overweight. it is all about the balance of risk. as we look nto 2025, we do think that inflation will hit the fed target by the first quarter of the year. that the fed will be in a position to cut rates by more than the market is expecting. another 25 in december, and 100 to 125 or even 150 thereafter in 2025. pretty consistent cutting of rates down to what we see as the neutral rate of about 3%. but the tricky part, as we look at gdp, job growth, a lot of the indicators that we have, that give us comfort we are in a good place, are very lacking and backward looking. if you look at ore forward-looking data, specifically around the labor market, we see some signs of weakening in job demand

which will further allow the fed to be in a position to cut rates. next week, we get payrolls which will be critical for the fed. but we also get jolts, job opening and job demand will be critical because it had been on a steep downward trajectory. >> what about bonds at these levels? they have kind of done their job this year, they ave eld their value but it has been a little bit of a tougher ride. >> yes, bonds are difficult because you have to have them as part of the folder, you have to as a sizable recession risk in your forecast to justify that. we have been in a soft landing camp. we have increased our recession risk a little bit but still do not have it as the base case. given the volatility of interest rates, we are more comfortable holding a neutral allocation to bonds.

looking for spots in other areas to be defensive. we took that small-cap allocation, the hedge funds which we think are lower beta than small-cap and be defensive. interest rates have come in pretty nicely and now there is balance to some upside risk as we look at the policy adjustments we could see in 2025 that is an area where i would be allocated but not taking large bets in either allocations from overall or even duration. >> thank you so much. have a good weekend. phil, the big bow on the hood of a car has been on automobile commercials forever, what do we think about that trend now? >> i am not sure we have too many big bows, a nice month the auto dealers have needed with

the pace of sales one of the strongest in terms of a monthly pace of sales this year, that is what the industry needs to december. this is what is expected according to jd power and global data higher incentives and greater sales, those incentives moving up is important because of the price coming down to over 45,000, the incentives as a percentage are still about 7.7%, 7.8% of the price, estimated sales rate of 16.5 million, this would make november one of the strongest months of this year for the auto dealers, as you look at the big three stocks, they are looking for this because they are looking at incentives up anywhere between 45% and 60% which drives traffic and closes the deals. you also see auto loan interest rates getting a little bit lower , not dramatically lower but any movement lower will certainly help in terms of closing deals. i want to o quickly about toyota, honda, ford, we get their monthly sales , november sales, next

week and we will get a sense of how strong november is. overall, positive commentary from dealers around the country. >> get those gas prices down, that probably does not hurt the larger vehicles. thank you so much. kristina, semi-capital equipment has struggled but popping today. >> because u.s. semiconductor sanctions on china may be less severe than initially anticipated according to a report from bloomberg the sanctions are expected to be announced in early december with the market largely pricing in that timing of the pacific impact. if the u.s. plans to tone it down, that bodes quite well for chip equipment makers like kla, applied materials, and it may focus on chip agreements rather than firms in china that manufacture chips, that is why texas instruments is higher, broad,, nvidia, all getting a

booth with the chip sector leading the s&p 500 today, smh is a good barometer breaking the four day losing streak which we can say is a relief rally after recent chip turbulence and investor fatigue in the sector. >> kristina, you mentioned investor fatigue , a reminder this will probably be an area that will move around on trade headlines for a while. >> yes. it may be a short blip up and back down when it settles over the next few weeks. >> as we go into the close 1:00 p.m. eastern close in this abbreviated market day, we are headed for a new record on the s&p 500, up 6/10 of 1%. the dow jones is up close to half a percent but is below the 45,000 mark. which it has never closed above.

russell 2000 but not much happening today. very much a large-cap story for the moment. strong volatility. under 14. as we go into another winning month for the s&p 500. that does it for closing bell. we will send you to overtime. that's the end of regulation. cibc closing markets leading the exchange. q mm folding's limiting. record closes for the dow and s&p 500 on this holiday shortened trading day. we kick off the final sprint into year-end. we had the best month for stocks in a year. the action is just getting started. coming up on