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13:57
PDT

Projected payroll increase of 55,000 for August.

Bloomberg Anna Wong Michael McKee Bloomberg Economics Bloomberg Surveillance Michael Mc Bloomberg Close PRIVATE

– Concerns over data reliability due to seasonal trends.

– Expected job losses of 37,000 in state and local government sectors.

– Bloomberg surveillance will provide detailed analysis tomorrow.

– Market participants should prepare for potential volatility.

employment dataeconomic growthmarket volatility

▸ Full transcript

Alright, less than 24 hours until the August jobs report. Economists are projecting a 55,000 increase in payrolls after an unexpected dip in July, indicating a bounce back after a surprisingly negative report. Absolutely, Scarlett. The projected bounce back for August raises questions over the viability of that data; can we actually trust it, or is it just due to some seasonal trends during the summer? Bloomberg Economics' Anna Wong expects the biggest drags to be state and local governments, with a loss of 37,000 jobs in that sector alone. We will be breaking down all the numbers tomorrow morning at 8:30 a.m. on Bloomberg Surveillance. Be sure to tune in; Michael McKee does a fantastic job at giving you all the details you need to know. That does it for us here on Bloomberg Close; Balance of Power is up next in Washington. Have a great evening. This is Bloomberg.

Analysis

Economists project a 55,000 increase in payrolls for August following a surprising dip in July, raising questions about the reliability of this data. Bloomberg Economics anticipates significant job losses in state and local governments, which could skew the overall employment picture.

13:56
PDT

August jobs report expected to show mixed employment data.

Bloomberg Annemarie Hordern Jonathan Lisa Marie Mike Turkey EMS Bloomberg Trade This Friday The August PRIVATE

– Analysts anticipate significant market implications from the report.

– Ambiguity in employment figures could lead to increased market volatility.

– Investors may need to reassess positions based on labor market conditions.

– The report is one piece of a larger economic puzzle.

labor market analysisemployment datamarket volatilityFed policy implications

▸ Full transcript

Media and information. Markets, trade, geopolitics. This is it. The trade that will make your number. And with next-generation speed, automation, and integration, this is the new fixed income EMS that will make sure you win it. Expect more from your execution management system. Bloomberg Trade EMS. Coming up to the minute geopolitical news, whenever and wherever it happens. I'm Annemarie Hordern in Ankara, Turkey. This is Bloomberg. It's jobs day, and Bloomberg has the reports under surveillance. This is going to have some major implications. A great degree of ambiguity is built into this market. This Friday, Jonathan, Lisa, Marie, and Mike will bring you crucial data and expert analysis at terminal speed. We've had employment data that's mixed, if not somewhat concerning to some extent on the headline level. It's one piece of a much bigger puzzle, but it's an important piece of that puzzle. The August jobs report. Friday on Bloomberg. The burning season is here. The burning story has been so powerful.

Analysis

The upcoming August jobs report is generating significant attention due to mixed employment data, which could have major implications for market sentiment. Analysts are preparing for a nuanced interpretation of the data, as it represents just one piece of a larger economic puzzle.

Smart money should note the degree of ambiguity surrounding the employment figures, as this could lead to volatility in market reactions. The mixed signals may prompt investors to reassess their positions ahead of the report, particularly in sectors sensitive to labor market conditions.

13:53
PDT

Sovereign AI and agentic AI are reshaping digital independence and decision-making.

Gisec Global AI Middle East

– Gisec Global is positioned as a key event for cybersecurity innovation in the Middle East and Africa.

– A cyber-first mindset is becoming essential for organizations navigating digital transformation.

– Investors should focus on companies that are leading in cybersecurity solutions.

– The convergence of AI and cybersecurity may create new market opportunities.

cybersecurity innovationAI advancements

▸ Full transcript

isn't defined by technology alone. As sovereign AI reshapes digital independence, as agentic AI transforms decisions, as quantum unlocks new possibilities, every breakthrough demands a cyber-first mindset. That's why the future meets at Gisec Global, the Middle East and Africa's largest cybersecurity event. We shape policy, we power innovation, we protect the digital order.

Analysis

The cybersecurity landscape is evolving rapidly as sovereign AI and agentic AI redefine digital independence and decision-making processes. The upcoming Gisec Global event highlights the importance of a cyber-first mindset in shaping policy and driving innovation in the Middle East and Africa.

Smart investors should note that the intersection of AI advancements and cybersecurity presents new opportunities for growth and investment. As organizations prioritize digital security, companies that innovate in this space may see increased demand and valuation.

13:51
PDT

Daydream has 1.5 million shoppers on its platform.

Daydream Julie Bornstein Michael Stuyper Bloomberg AI CEO Now Daydream Sunni Purchase Bloomberg Money PRIVATE

– The platform does not rely on ads but earns through merchant commissions.

– 50% of users know what they want, while the other half need assistance.

– Personalization in shopping is becoming increasingly important.

– The back-to-school shopping season is expected to be significant this year.

AI in retailpersonalized shoppingconsumer behavior

▸ Full transcript

So I think that's one big thing is everyone who's on our platform, which is 10,000 brands, are safe and reliable brands. I would say the second is that we don't make money by selling ads or by showing specific brands. We're literally just trying to find the best match for you. And so it's very much in the consumer's best interest the way the recommendation is made. Now Daydream has surpassed 1.5 million shoppers. What have you learned about whether AI shopping actually creates some repeat behavior? Yeah, what we've learned is that I would say about half the people come in and they actually know what they want to say. So, you know, they get really detailed, they give you a lot of context and the other half are kind of like, what do I do? And so we have brows as well. So if you come in, you can see some ideas and we can help guide you and then as you get deeper in your search, you can start to refine either telling the agent what you want or looking for more things like that item. And so we have definitely seen that some people need help getting started and we provide those tools. How are you making your money because it's free for me to use? It is free to use. If you buy something, then the merchant that you buy it from gives us a cut of the sale. God, yeah, all right Julie. Thank you so much. Julie Bornstein is founder and CEO of Daydream and we mentioned back to school as students head back to school. I caught off with Sunni Purchase president Michael Stuyper in a conversation that we will show you tomorrow. You don't want to miss that on Bloomberg Money at 12 noon Eastern time. This is the close on Bloomberg.

Analysis

Daydream has surpassed 1.5 million shoppers, indicating strong user engagement with its AI shopping platform. The company operates on a commission model, earning revenue from merchants when users make purchases, which highlights a sustainable business model focused on consumer satisfaction.

The insight here is that half of Daydream's users come in with specific requests, while the other half require guidance, suggesting a significant opportunity for personalized shopping experiences. This dual user behavior could drive repeat usage and loyalty, making Daydream a potential disruptor in the retail space as AI continues to shape consumer habits.

13:49
PDT

Zumba's fastest growth markets include the US, Germany, Japan, Korea, India, and China.

Zumba Alberto Perlman Insight Partners Germany Japan Korea India China

– The company prioritizes instructor success and operational flexibility by remaining private.

– Fitness is increasingly seen as a social activity, replacing nightlife.

– Zumba has multiple revenue streams, including instructor memberships and consumer apps.

– The company does not currently seek additional capital for growth.

fitness industry growthconsumer behavior shift

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Body type. And so I think it takes a little bit of the stress out of shopping because you can just explain what you need. Yeah. Well, and talk to us about some of the optimization that you mentioned here because I can imagine one of the stresses that parents undergo is when trying to look for stuff, you know, they don't have time to look through reviews, right? To see what is the best product for whatever their kid is asking for. And so do you have any features that help optimize it and make that process just more efficient? One of the great things we have is a way for you to sort of see more like something so if your kid says, 'Oh my gosh, I love this,' but let's say it's too expensive, you can go find this and then you can see all the versions of that that are more affordable, and that has been a really popular tool. The dupe. The dupe. Exactly. So that's for people who know what they want. When I shop, I often don't know what I want and I need exclusions. I need to be able to say I need a formal dress for a wedding, but I don't want something that's strapless, I don't want something that's too tight, and I don't want something that's too frilly. Is that something I can enter into the day search bar, things I don't want? Yes, and it works really well. Yeah, it's something you can't do anywhere else, so it's pretty cool. How do you address the inconsistent sizing across brands because that's a big problem for women's wear? It is, it is, and we'll get better at that over time. You need a lot of data to get good at that, but what we do do is if you tell us your sizes, we can just show you the things that are in your size so you're not landing on like the perfect product only to find it's out of stock in the size that you wear. So we offer that feature. No, I think one of the things that I think a lot of could.

Analysis

Zumba is experiencing significant growth in markets such as the US, Germany, Japan, Korea, India, and China, driven by a shift in consumer behavior towards fitness as a social activity. The company remains privately held, valuing its operational flexibility and focusing on instructor success without the pressure of multiple stakeholders.

The rise in fitness participation is replacing traditional nightlife activities, indicating a cultural shift that could sustain demand for fitness-related services. Additionally, Zumba's diverse revenue streams, including instructor memberships and consumer apps, position it well to capitalize on this trend without needing external capital for growth.

13:47
PDT

Back-to-school shopping expected to be the largest season yet.

Julie Bornstein Daydream AI CEO Troy Bolton

– Over 60% of consumers plan to use AI for shopping assistance.

– Users are increasingly specific about their fashion preferences.

– Personalization in shopping is becoming a key driver of consumer behavior.

– AI shopping platforms like Daydream are positioned for growth.

AI in retailConsumer behaviorPersonalization

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This year's back-to-school shopping is the first big stress test for AI shopping behavior, says Julie Bornstein, the CEO of Daydream, an AI shopping platform that aims to act as a personalized stylist and assistant to shoppers. Julie Bornstein, the CEO, joins us now. Julie, great to see you here. Thanks for having me. So just explain to us how this works. You are an app and also a website. Do users like Christine and myself just go into the app and start typing out what we want? Yes, you can download the app. You can actually tell us a little bit about yourself if you want, or if you don't have the patience, you can skip it. But once we understand a little bit about you, we can actually serve you better. And then you chat with the agent and you describe what you're looking for, and we give you results, and you can refine through a number of ways. And this is already live right now. What have you seen so far with back-to-school shopping? How are people using it? So it's interesting because back-to-school shopping is expected to be the biggest ever season this year. And in spite of the economy, over 60% of people are saying they're going to use AI to help them. So I think we've all become used to using ChatGPT and other tools. What we're finding is that people are asking for specific brands; they're asking for things like, 'I want to look like Troy Bolton when I go back to high school.' They're saying, 'I want low-rise jeans, not the like 2026 low-rise, but the 2000s low-rise.' And what's beautiful about this kind of shopping is that you can say specifically what you're looking for.

Analysis

Back-to-school shopping is set to be the largest season yet, with over 60% of consumers planning to use AI tools for assistance. This trend indicates a significant shift towards personalized shopping experiences, as users are increasingly specific about their preferences and styles.

The integration of AI in shopping behavior reflects a broader acceptance of technology in everyday life, suggesting that companies like Daydream could see substantial growth. Smart money should note the potential for AI-driven platforms to capture market share in retail, especially as consumer preferences evolve towards more tailored experiences.

13:45
PDT

The fund has over 125 years of market experience.

the fund

– Focus on diverse asset classes including real estate and private credit.

– Emphasis on proactive investment strategies.

– Potential for risk management through diversification.

– Strategic vision aimed at capitalizing on current market opportunities.

market cyclesdiversified investments

▸ Full transcript

The fund invests with the foresight and vision that come from navigating more than 125 years of market cycles. Unlocking the potential of public and private markets, spanning real estate to private credit, and infrastructure to natural capital. Finding opportunity today to shape how.

Analysis

The fund emphasizes its extensive experience in navigating over 125 years of market cycles, focusing on unlocking potential across various asset classes including real estate and private credit. This approach highlights a strategic vision that seeks to capitalize on current market opportunities, suggesting a proactive stance in a dynamic investment landscape.

Smart money should note the fund's diversified investment strategy, which spans both public and private markets, indicating a robust framework for risk management and opportunity identification. This breadth of focus may position the fund favorably against market volatility, allowing it to adapt and thrive in changing economic conditions.

13:43
PDT

Zumba prefers to stay private and focus on community and instructor success.

Zumba Alberto Perlman Insight Partners IPO CEO But Zumba In Zumba

– Insight Partners has been a stable private equity partner since 2012.

– The fitness industry is replacing nightlife as a social engagement platform.

– Zumba's growth strategy emphasizes instructor success over external capital.

– K-pop and reggaeton music are popular in Zumba classes, enhancing participant enjoyment.

fitness industry growthcommunity engagementprivate equity investment

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to the world of Zumba. But Zumba is always our core. I mean it's 25 years. I am curious. I mean you're still founder led by the Alvertos. Is there any plans to maybe sell a bigger stake of this company? Maybe do an IPO? Do you just want to stay private? We love staying private. We love running our business. We love the flexibility that we have by running our business. We do have a private equity partner, Insight Partners. Insight Partners. What's your relationship with them now? It's great. I mean, because they entered what? That was that's been there a while 2012. 2012. We're not continuation fund, but they're fine. They're good. They're happy with their with their investment. But with regards to your growth ambitions, do you need more capital to do that? Or can you just do that? Oh, with your own generation? We just want to serve the community. And we don't have to. We don't want to have so many different stakeholders that we don't do our that we don't follow our number one mission, which is to make the instructor successful. So that's our North and we do anything we can and everything we can to make our instructor successful. All right, I do have to ask you, I assume you do Zumba classes yourselves, right? I've taken my Zumba classes. What's the one program that's kind of most fun for you? Program that's gonna- In Zumba, is there anything specific? In Zumba? Yeah. Well, I like when they play K-pop songs, I like when they play reggaeton songs. Yeah. I like everything, really. All right, that was Zumba CEO and co-founder, Alberto Perlman with bloomers remain bostic. There are some notable movers in after hours trading. Let's just run through them really quickly. Lululemon.

Analysis

Zumba CEO Alberto Perlman confirmed the company's preference to remain private despite having a private equity partner, Insight Partners, since 2012. The focus remains on community and instructor success rather than pursuing an IPO or additional capital from multiple stakeholders.

The fitness industry is experiencing a shift as people seek community engagement post-pandemic, with Zumba positioning itself as a social alternative to nightlife. This trend indicates a potential for sustained growth in fitness-related businesses as consumer preferences evolve towards health and wellness.

13:41
PDT

Zumba's fastest growth markets include the US, Germany, Japan, Korea, India, and China.

Zumba Alberto Perlman Germany Japan Korea India China US VHS Latin America Nintendo Wii USDCNH

– Revenue streams are diversified across instructor memberships, training, apparel, and video games.

– Post-pandemic, fitness is becoming a social alternative to nightlife.

– Zumba's community aspect enhances member retention and engagement.

– The company has successfully transitioned from physical media to digital platforms.

fitness industry growthcommunity engagementpost-pandemic behavior

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We combine the magic of Zumba with lifting in one class, programming for seniors and kids, and Zumba is just going everywhere. Where are you growing fastest geographically? Is it here in the US, Latin America, or Asia? The US, Germany, and Japan are huge for us; Korea is huge for us; India is exploding; China is exploding. Those are our biggest growth markets. As far as your revenue, just so we understand it, is that mostly coming from instructor memberships, training, apparel, and licensing? Yes, we meet people where they are. We started out with infomercials selling VHS tapes on television in 2002, then DVDs. Then we started training instructors, then the membership for instructors, then apparel, and video games. We sold 14 million video games on the Nintendo Wii. We have consumer apps for people to take Zoom classes at home, so it's varied. Have you benefited from this general sense of people wanting to be out more? There was a sense during the pandemic that we were all shut in, and then at some point, we wanted to be back out in the world. We talk with movie theater operators; we've seen a huge bump in business, a lot of other experiential businesses as well. Has that been a direct impact on the fitness industry? It's amazing because I think fitness is replacing the nightclub. People used to go to nightclubs and drink. Drinking is way down; fitness is way up. People are getting together to exercise together.

Analysis

Zumba is experiencing significant growth in markets such as the US, Germany, Japan, Korea, India, and China, with diverse revenue streams from instructor memberships, training, apparel, and video games. The fitness industry is witnessing a shift as social exercise replaces nightlife, indicating a cultural change in consumer behavior post-pandemic.

Smart money should note that Zumba's expansion into various demographics and its adaptability in revenue generation could position it favorably against traditional fitness models. The trend of fitness as a social activity suggests potential for sustained growth in community-driven fitness programs, which may attract investment interest.

13:39
PDT

Zumba has a unique offering that combines emotional and physical fitness benefits.

Zumba Alberto Perlman Bloomberg Romain Bostic CEO Randall Williams PRIVATE

– The company operates in 189 countries with 200,000 locations.

– Zumba's community engagement is a significant driver of its growth.

– The focus on both membership growth and geographical expansion indicates a robust growth strategy.

– Zumba's model could serve as a blueprint for other fitness programs.

fitness industry growthcommunity engagementglobal expansion

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Randall Williams. Now let's stay in the space and talk fitness. Zumba is celebrating its 25th anniversary, marking more than 465 million live classes and 200,000 studios across the world. CEO and co-founder Alberto Perlman came by the studio last week to talk with Bloomberg's Romain Bostic about the company's growth, key markets, and new revenue drivers. Take a listen. Most fitness programs live in just like the physical space. Like this is better for your abs, better for your lighter, and those are the ones that come and go. But there are some that have lived in the emotional space as well. And in a Zumba class, you have dopamine because you're anticipating the next move. You release oxytocin because you're with other people laughing and smiling. You have serotonin because of the music and the moves. And you have endorphins at the same time, which every fitness program has endorphins, but you have the other three. We're the only fitness program that releases all brain chemicals at once. And then we have the Zumba community, 15 million people taking Zumba classes every week. And they create huge bonds with each other. They travel. It's a community. It's the emotion and the physical benefits. When we start to talk about the growth, where you can go over the next 25 years, what strives at, is it just getting more members or is it expanding your footprint geographically? How do you do that? So we're in 189 countries. We're in 200,000 locations. That's like most of the world. That is all of the world except for the countries we cannot be in. But the countries we can.

Analysis

Zumba celebrates its 25th anniversary, boasting over 465 million live classes and a community of 15 million participants weekly. CEO Alberto Perlman highlights the unique emotional and physical benefits of Zumba, positioning it as a leader in the fitness industry with a presence in 189 countries.

The company's growth strategy focuses not only on increasing membership but also on expanding its geographical footprint. This dual approach could enhance Zumba's market share and solidify its brand as a global fitness leader, appealing to investors looking for sustainable growth in the wellness sector.

13:36
PDT

LA Clippers fined $30 million, largest penalty in NBA history.

LA Clippers Steve Ballmer Kawhi Leonard NBA US LA Arthur Ashe Coco Gauff Carlos Alcaraz The Clippers DXY

– Stripped of five first-round draft picks due to compensation violations.

– Clippers express dissatisfaction with the ruling, indicating potential league tensions.

– Kawhi Leonard's fine of $700,000 suggests leniency in player penalties.

– Increased scrutiny on team operations and player contracts expected.

sports governanceplayer compensationNBA regulations

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A lot more than a hundred dollars. She wasn't even at Arthur Ashe. So, you know, what do you think is happening with kind of her, the hype behind her, but also just in general, the idea of new entrants that could potentially make the US Open exciting again? I think the US Open and a lot of tennis players create really fun moments. And so people want to be a part of those. It's not just her, it's of course Coco Gauff. It's, you know, Carlos Alcaraz. It's all these stars that people want to watch them. Now, granted, there's a lot of other tennis playing. If you just want to go to the US Open, you can get in now fairly cheap. But if you want to watch the stars, it's going to cost you. All right, let's switch over to the NBA. The LA Clippers find $30 million, the largest ever financial penalty. They're stripped of five first-round draft picks, all because Steve Ballmer's team seemed to make their way around some rules on making sure that you don't pay your players more than what has been agreed to. So can the Clippers appeal this? Because they're very unhappy with the decision. Not through the collective bargaining agreement. The punishment that Kawhi Leonard received was a fine of seven hundred thousand dollars and of course you outlined the Clippers' punishment. He's allowed to play. Kawhi Leonard is allowed to play now. You know, if you're looking at this in totality, Kawhi Leonard got off easy. The reason for that is because the union and the league came together and negotiated on what this punishment was going to be. Kawhi Leonard, the owner, took responsibility for his actions and said, 'Look, this was a mishap. I made a mistake. I have a new agent. This is not going to happen again.' The Clippers came out with a fiery statement and said, 'We still did not do anything wrong.'

Analysis

The LA Clippers have been fined $30 million, the largest financial penalty in NBA history, and stripped of five first-round draft picks due to violations related to player compensation. Despite the hefty punishment, the Clippers maintain their innocence and express dissatisfaction with the ruling, indicating potential tensions within the league regarding compliance and governance.

The Clippers' situation highlights the increasing scrutiny on team operations and player contracts, especially as the league navigates complex collective bargaining agreements. This incident may signal a shift towards stricter enforcement of rules, which could impact team strategies and player negotiations moving forward.

13:35
PDT

Conferences are consolidating power, potentially leading to a breakaway league.

NCAA Lee Steinberg Romaine Bostic US Open TV NIL US New York Rando Williams

– NCAA's relevance is diminishing as conferences can set their own rules.

– Player compensation is becoming increasingly chaotic and unsustainable.

– The landscape of college sports is rapidly changing with NIL and gambling issues.

– Ticket prices for the US Open are falling, indicating potential shifts in demand.

college sports governanceplayer compensationticket sales trends

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Their own TV contracts and put their own rules together. So the power really is in the conferences, and the elevation of it. We're moving to a have-have-not situation where you'll have roughly 40 schools and then everybody else. So, I mean, we're basically talking about a breakaway league. Does that then make, I mean, if these are all the top schools and they break away, I mean, what's the relevancy of the NCAA anymore? Well, that's the point, and I think that conferences have realized that they are the centrality of power in this and they can make their own rules. They could agree on NIL rules. Now, don't get me wrong, I've spent 52 years fighting for player compensation, so I think that it's welcome. It just is a little bit out of control. And that was force agent Lee Steinberg speaking with our very own Romaine Bostic. Let's go from the gridiron to the tennis court now with the US Open in full swing. Caviar top chicken nuggets, honey deuces for I think like $30. And celebrity appearances making the tournament one of the hottest New York events. But new numbers out from ticket data show that the get-in price for each round have been falling compared to 2025. Senior sports reporter Rando Williams is heading over to the event tomorrow. He joins us now. I know that you go on a media pass. But why are tickets falling, certainly compared to earlier in the tournament when they were going up and up and up on the second.

Analysis

The NCAA's relevance is being questioned as conferences gain power and may form a breakaway league, leaving the organization behind. Lee Steinberg highlights the chaotic state of player compensation, suggesting that while progress has been made, the current system is unsustainable and out of control.

Smart money should note that the shift in power dynamics within college sports could lead to significant changes in revenue distribution and governance. The potential for a breakaway league may disrupt traditional college sports economics, impacting broadcasting rights and sponsorship deals.

13:33
PDT

Bipartisan bills aim to regulate college athlete compensation.

Lee Roberts UNC Congress NIL gambling

– Concerns over unqualified marketing directors for athletes.

– Gambling poses a significant risk to the integrity of college sports.

– The landscape of college sports is rapidly changing with NIL and gambling.

– Legislation may not fully resolve the issues but is a step forward.

college athlete compensationsports integritybipartisan legislation

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Universal form of regulation. The marketing directors the players are hiring may not be qualified at all. But they don't have to be certified. I mean, what's the potential solution? Like, what would you propose as a reform? And we should point out there is bipartisan legislation that is trying to work its way through Congress that would partially address this. I had caught up a few weeks ago with Lee Roberts over at UNC, who talked a lot about not only how he was in favor of it, he didn't think it was going to fix the problem completely, but it would be a start. I think there is a Democratic bill, there's a Republican bill, there's a Trump bill. There are all sorts of different solutions. Any of them have an advantage over a completely unregulated system. And you mentioned gambling a second ago. An existential threat because all it's going to take is one player to share inside information with a gambler or one player to shave performance in association with a gambler. And then people start to question the validity of the game they're watching on the field and boom, you get wrestling. So we have conference realignment. We have NIL. We have gambling. The landscape has changed exponentially fast. Do you think that there is or sort of any chance where we could see maybe in the college.

Analysis

Bipartisan legislation is being proposed in Congress to address the unregulated landscape of college athlete compensation and marketing, which has raised concerns about the qualifications of marketing directors hired by players. The potential for gambling-related scandals poses an existential threat to the integrity of college sports, as any insider information shared could undermine public trust in the games.

13:31
PDT

Lee Steinberg highlights concerns over NIL compensation in college football.

Lee Steinberg NIL college football Gisec Global Middle East Romain Bostek Jerry Maguire

– Advocates for addressing living standard disparities for athletes.

– Potential for regulatory changes in player compensation.

– Impact on college sports financial landscape is significant.

– Investors should watch for shifts in sponsorship opportunities.

college sports compensationNIL regulations

▸ Full transcript

Locks new possibilities. Every breakthrough demands a cyber-first mindset. That's why the future meets at Gisec Global, the Middle East and Africa's largest cybersecurity event. We shape policy. We power innovation. We protect the digital order. College football season is here, with week one officially kicking off tonight. Romain Bostek recently caught up with legendary sports agent Lee Steinberg. You might know him as a real-life inspiration for the Oscar-winning film Jerry Maguire. Steinberg says player compensation around NIL deals has gotten 'out of control.' Take a listen. I'm always in favor of player compensation, but to fix the problem, which was players on a college campus who were being left at a lower standard of living than their non-athletic peers who could work to supplement their income.

Analysis

Legendary sports agent Lee Steinberg expressed concerns that player compensation around NIL deals in college football has become 'out of control.' He advocates for player compensation but emphasizes the need to address the disparity in living standards between athletes and their non-athletic peers on campus.

Smart money should note that the ongoing debate around NIL deals could lead to regulatory changes or new frameworks for player compensation, impacting college sports' financial landscape. Investors in sports-related businesses should monitor how these changes might affect revenue streams and sponsorship opportunities.

13:29
PDT

Adobe appoints Anil Chakravarti as CEO.

Adobe Anil Chakravarti Scarlet Christine Christina Kinos CEO AI WNBA PRIVATE

– Concerns persist about AI disruption in the software sector.

– Market reaction shows skepticism with a 2% decline in shares.

– Continuity over disruption may limit innovation.

– Investors are wary of leadership effectiveness in adapting to AI.

AI disruptionleadership changesoftware sector challenges

▸ Full transcript

Christine, Adobe is coming out with a CEO, and I don't know that this quells concerns about AI and the disruptive factor it'll have if you go internal because personally this is someone who's been there during the time when it had to answer difficult questions about AI. Yeah, absolutely, Scarlet. I mean, you know, at a time when AI is disrupting a lot of software, including Adobe, you probably want a disruptor as a CEO, but I guess they went for the continuity instead. Continuity play right now from Adobe. Now coming up from the football field to the tennis court, we're going to cover everything that's happening right now in the world of sports, including the basketball court as well with Christina Kinos WNBA. This is the close on Bloomberg.

Analysis

Adobe's appointment of Anil Chakravarti as CEO raises concerns about the company's ability to navigate AI disruption, as he has been part of the organization during challenging times regarding AI. The choice for continuity over a disruptive leader suggests a cautious approach amidst significant industry changes.

Smart money should note that while continuity may provide stability, it could also hinder innovation at a time when aggressive adaptation to AI is crucial. The market's reaction, with shares down 2% in aftermarket trading, reflects investor skepticism about whether Chakravarti can effectively lead Adobe through the evolving landscape of AI-driven competition.

13:27
PDT

Anil Chakravarti appointed as Adobe CEO effective December 1st.

Adobe Anil Chakravarti Informatica AI CEO Treasury Secretary

– Aftermarket shares declined by 2% following the announcement.

– Chakravarti has experience in cloud and subscription models from Informatica.

– Concerns persist about AI disrupting traditional graphics software companies.

– Internal promotion may indicate a strategy for stability during transformation.

AI disruptionCEO transitioncloud strategy

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Today, there are specific guardrails in place that essentially prevent users from accessing those most cutting-edge powerful capabilities. But it was really interesting that at the same time, he acknowledged, which was in response to a direct question about what the Treasury Secretary had said yesterday, that the AI industry has not done a good job of saying, "Hey, actually, AI can benefit you in lots of different ways." And again, going back to the news of the day, which is the model, the whole point with Astra is that you can just do more useful things rather than just pose questions, text input, get a response. You know, speaking of AI, there is also breaking news from Adobe, which is a graphics software company that a lot of people are worried will be disrupted by AI. It announced a new CEO, Anil Chakravarti, who will become President and CEO effective December 1st. If I remember correctly, it took a while for Adobe to identify its new CEO, didn't it? It has, and they've been doing this search. Ultimately, they've gone with an internal candidate. So, Anil Chakravarti is basically an enterprise veteran. He's been at Adobe since 2020, and in that six-year period, he has had responsibilities both on the product side and on the go-to-market side. The shares are down in aftermarket, I mean 2%, maybe that's like a modest decline. But he might be better known for his period leading Informatica. He kind of was at Informatica throughout the take-private era where he was focusing on gearing them towards being a cloud company, a subscription company.

Analysis

Adobe announced Anil Chakravarti as its new CEO, effective December 1st, which has led to a modest 2% decline in aftermarket shares. His experience includes a focus on transitioning Informatica to a cloud and subscription model, which may signal a strategic shift for Adobe amidst AI disruption concerns.

Smart money should note that the internal promotion reflects a potential continuity strategy at Adobe, possibly indicating stability during a transformative period for the company. The market's reaction suggests skepticism about Chakravarti's ability to navigate the challenges posed by AI advancements in the graphics software sector.

13:25
PDT

OpenAI is launching a new generation of AI technology.

OpenAI Sam Altman Bloomberg Tech Ed Lotto EMS CEO AI Bloomberg Trade PRIVATE

– Safety and security are prioritized in the new model's development.

– Public concerns about AI power are acknowledged by OpenAI's leadership.

– Responsible management of AI advancements is crucial for mitigating risks.

– Regulatory scrutiny may increase as AI capabilities expand.

AI technologypublic concernssafety and security

▸ Full transcript

The trade that will make your number. And with next generation speed, automation, and integration, this is the new fixed income EMS that will make sure you win it. Expect more from your execution management system. Bloomberg Trade EMS. As these models get more capable, the risks that we have to mitigate also become more serious. The models could do more damage if we don't do a good job at that. And so we have spent, you know, obviously this model took us a little longer to release than we were hoping. I think it'll be worth the wait. We really wanted to spend the time on the safety and security alignment of this model. That was OpenAI CEO Sam Altman sitting down with Bloomberg Tech's Ed Lotto just moments ago as the firm rolls out a new generation of its technology. I'm pleased to say that Ed Lotto joins us now. Ed, great interview with Sam earlier. I know that part of your discussion with him was really all about the public's concerns around the power that a lot of these AI models have really garnered. They've become so much more powerful, so much more capable. And in fact, OpenAI is very much leaning into that capability, but you also pointed out the concerns from the public around this power.

Analysis

OpenAI is rolling out a new generation of its technology, emphasizing the importance of safety and security in its models. CEO Sam Altman acknowledged the growing public concerns regarding the power and capabilities of AI models, highlighting the need for responsible management of these advancements.

Smart money should note that while OpenAI is enhancing its technology, the focus on safety may indicate a cautious approach to deployment, potentially affecting competitive dynamics in the AI sector. The emphasis on public concerns suggests that regulatory scrutiny could increase, impacting future innovations and market strategies.

13:23
PDT

Bitcoin up 5.3%, surpassing $80,000.

Bitcoin Lululemon Heidi O'Neill Chip Wilson Victoria's Secret Nike NUVINE

– Lululemon down 15% after cutting full-year outlook.

– Product issues and competition are major concerns for Lululemon.

– Incoming CEO Heidi O'Neill faces skepticism regarding her experience.

– Discounting has significantly impacted Lululemon's gross margins.

retail challengesleadership changecompetitive pressureproduct strategy

▸ Full transcript

NUVINE invests with the foresight and vision that come from navigating more than 125 years of market cycles, unlocking the potential of public and private markets, spanning real estate to private credit, and infrastructure to natural capital, finding opportunity today to shape how portfolios are built for tomorrow. NUVINE invests like the future is watching.

Analysis

Bitcoin has surged over 5%, surpassing the $80,000 mark for the first time in months, indicating a robust risk sentiment in the market. Meanwhile, Lululemon's stock has plummeted 15% in after-hours trading due to a second consecutive cut in its full-year outlook, highlighting ongoing product issues and competitive pressures.

Smart money should note that Lululemon's challenges are compounded by a lack of leadership and a need for a significant product overhaul, which could take months to implement. The competitive landscape is tightening, with rivals successfully attracting both lower and higher-income shoppers, suggesting that Lululemon may need to rethink its pricing strategy and product offerings to regain market share.

13:20
PDT

Bitcoin gains over 5%, surpassing $80,000.

Bitcoin Lululemon Heidi O'Neill Nike Victoria's Secret Chip Wilson Zscaler DocuSign CEO DTC The Gap Hillary Super

– Lululemon's stock drops 15% after cutting outlook.

– Incoming CEO Heidi O'Neill faces skepticism.

– Lululemon needs a product overhaul to regain market position.

– Discounting issues are impacting Lululemon's margins.

retail challengesleadership changesproduct strategydiscounting trends

▸ Full transcript

Products that are working. This is all kind of early stage, but again it's really hard to break out of this discounting cycle. Certainly, the Gap has done it, so it can be done. The Gap was in that cycle for a good decade and has come out the other side. And that's key, right? It was in that for a good decade. You, when looking at the incoming CEO, Heidi O'Neill, are concerned about what she has done and hasn't done during her tenure at Nike. Just sum up for us what your biggest concern is there. I think that, you know, when we look at a CEO coming in from Nike, which over the past two years, we've seen the trajectory of what Nike's been doing, whether it's wholesale or DTC. They're also going through a big margin cleanup because product has not worked and the competition has taken over. So, there's been a lot of question marks of what can someone from Nike offer that's differentiated, that's out of the box, that comes from such a big global brand that was on a downturn. And again, you point to something like Victoria's Secret where, you know, Hillary Super who came in was maybe not the obvious choice, but an amazing choice thinking out of the box. And I think when they announced a Nike person coming in, there was a lot of disappointment in, is this the answer? But you know what? We have to give her a chance to come in and hit the ground running and show us what the product's going to look like but again that's going to take six to twelve months to make that happen. Yeah and she has a pretty big to do.

Analysis

Bitcoin has surged over 5%, surpassing the $80,000 mark for the first time in months, indicating a robust risk sentiment in the market. Lululemon's stock has plummeted 15% in after-hours trading after cutting its full-year outlook for the second consecutive quarter, highlighting significant product and leadership challenges ahead.

The incoming CEO, Heidi O'Neill, faces skepticism due to her previous tenure at Nike, which has also struggled with product issues and competition. The need for a complete product overhaul at Lululemon is urgent, as the brand's premium pricing power is eroding amidst increasing discounting and competition from brands like Victoria's Secret and others.

13:18
PDT

Lululemon shares down 15% post-earnings.

Lululemon Viori Allo Victoria's Secret Chip Wilson Heidi O'Neill New York

– Second consecutive cut to full-year outlook.

– Comparable sales fell 9% in Q2.

– Increased competition from brands like Viori and Allo.

– Discounting has negatively impacted gross margins.

competitive landscapeproduct strategypricing power

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It's tough. And again, the competition has really closed in, with stores opening right across the street from Lululemon, whether that's in London or New York or anywhere. There's a Viori and an Allo opening up across the street. Again, I think it needs a revamp of the younger customer and it needs to be more focused. There needs to be color and fun, and it needs to be technical at the same time. If you go into some of the competitive stores, it's fun. There's music. There's a vibe. You want to hang out; you don't feel the same there. Certainly, if you look at other retail stories like Victoria's Secret today, their comps are up 9%, showing a huge turnaround in two years. Not only are they getting the under $50,000 shopper, but they're also attracting the over $200,000 shopper, which is where their performance is best. This can be done, and it shows you that while everybody likes to point to gas prices and pressures in the economy, product rules when it comes to these stories. Absolutely. I mean, speaking of prices, right? Lulu traditionally has been seen as carrying a bit of a premium over other athletic brands out there. Do you think that's something that they can still wield in terms of pricing power, or are the product issues really taking over to the point where they might have to start looking at discounting? Well, they have been discounted, and that's been a big problem. Over the past year, gross margins are down several hundred basis points. We actually track the amount of items on clearance year over year, and I've seen numbers up between 50 and 80%.

Analysis

Lululemon's shares are down approximately 15% in after-hours trading following a second consecutive cut to its full-year outlook, with comparable sales falling 9% in Q2. The company faces significant challenges, including product missteps and increased competition, necessitating a complete overhaul of its product strategy and brand appeal.

The competitive landscape is tightening, with rivals like Viori and Allo opening stores nearby, indicating a need for Lululemon to revamp its approach to attract younger customers. The brand's traditional pricing power is under threat as discounting has increased, leading to a decline in gross margins, which could further impact its market position if not addressed promptly.

13:16
PDT

Lululemon's comparable sales fell 9% in Q2.

Lululemon Heidi O'Neill Chip Wilson Zscaler DocuSign CEO North America

– The company cut its full-year outlook for the second straight quarter.

– Chip Wilson's criticism highlights ongoing product missteps.

– Heidi O'Neill's leadership may take 6-12 months to show results.

– Lululemon's stock dropped 15% in after-hours trading.

retail challengesleadership changeproduct strategy

▸ Full transcript

We need to hit the ground running with a complete overhaul of products here, and that's the main issue. These things, what you're identifying, sound like they'll take months to fix at the very least. The founder of Lululemon and key shareholder Chip Wilson has been an irritant as well for the company, criticizing strategy from the sidelines. Lululemon did agree to a deal where he can name two directors to the board. Is his input going to be helpful or harmful to the company? Eritan is a nice way to put it. But he has been correct, right? Because he saw the product missteps; he saw the direction it was going in. Yes, we have, and if you recall last quarter, they talked about the comps turning negative as a result of negative social media and media pressure from the proxy fight. I mean, shoppers don't really think that way when they're going in the store; they think about what they see and what they liked. It was a traffic and conversion issue that's gotten worse here. So I think yes, you absolutely do need a refresh here. They've had a couple of new board seats, so you do need fresh eyes here. You need people who are coming in and saying, 'We're going to challenge the status quo here.' Certainly, when you have a new CEO, there has to be new input, new thought processes here because what they've been doing for the last several years has not been working. If you look at the numbers, not only was North America down double digits, but now in tri-

Analysis

Lululemon is facing significant challenges, with a need for a complete product overhaul and a new CEO, Heidi O'Neill, expected to take time to implement changes. The company's comparable sales have fallen 9% in the second quarter, and it has cut its full-year outlook for the second consecutive quarter, leading to a 15% drop in after-hours trading.

The involvement of founder Chip Wilson, who has criticized the company's strategy, may bring both insight and disruption. His ability to name two directors to the board could introduce fresh perspectives, but the ongoing product missteps and negative social media sentiment suggest that Lululemon's turnaround will require more than just new leadership; it demands a fundamental shift in strategy and execution.

13:14
PDT

Lululemon's stock down 15% after cutting full-year outlook.

Lululemon DocuSign Zscaler Heidi O'Neill Stacy Widdlitz SW CEO Retail Advisors

– Comparable sales for Lululemon fell 9% in Q2.

– DocuSign and Zscaler reported positive earnings and outlooks.

– Zscaler's revenue outlook topped analyst estimates.

– Lululemon faces significant product and leadership challenges.

retail challengestech earningsleadership transition

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The environment that we're seeing is benefiting from the improved risk sentiment here, with Bitcoin gaining more than 5%, currently at 5.3%, and topping the $80,000 mark. This is the first time we've seen that in a few months, and the question is whether it can stay there and if risk sentiment can remain as robust as it has been today. A lot of green is visible on the screen. Let's take a look at some notable movers in after-hours trading: green for DocuSign and Zscaler. DocuSign is boosting its 2027 forecast, while Zscaler provided a revenue outlook that topped analysts' estimates. However, Lululemon is down about 15% in after-hours trading after cutting its full-year outlook for a second consecutive quarter, with comparable sales falling 9% in the second quarter. To help us break down those Lululemon results is Stacy Widdlitz, president and founder of SW Retail Advisors. Stacy, Lululemon has many issues to address right now, and it still does not have a permanent CEO. The incoming CEO, Heidi O'Neill, will need a solid plan. This has been a situation of two years of product mistakes. When we first started to see that and began noticing markdowns in December 2024, we put a sell on the stock, recalling that the stock was $500 two years ago. The product has not been fixed, and the competition is skyrocketing.

Analysis

Lululemon's stock is down about 15% in after-hours trading following a second consecutive cut to its full-year outlook, with comparable sales falling 9% in the second quarter. Meanwhile, DocuSign and Zscaler reported positive earnings, with Zscaler's revenue outlook exceeding analyst estimates and DocuSign boosting its 2027 forecast.

The ongoing challenges for Lululemon, including product missteps and leadership transition, suggest a prolonged recovery period under incoming CEO Heidi O'Neill. Smart money should note the competitive landscape intensifying against Lululemon, which may hinder its ability to regain market share quickly despite potential improvements in management and product strategy.

13:12
PDT

AI and quantum technologies are reshaping the digital landscape.

Gisec Global AI quantum cybersecurity Middle East Joe Matthew White House The Close PRIVATE

– A cyber-first mindset is essential for future innovations.

– Companies must focus on genuine innovation rather than hype.

– Cybersecurity is becoming a critical focus for businesses.

– Events like Gisec Global are pivotal for shaping policy and innovation.

cybersecurityAI innovation

▸ Full transcript

The new digital order isn't defined by technology alone. As sovereign AI reshapes digital independence, as agentec AI transforms decisions, and as quantum unlocks new possibilities, every breakthrough demands a cyber-first mindset. That's why the future meets at Gisec Global, the Middle East and Africa's largest cybersecurity event. We shape policy and power innovation. We protect the digital order. Talking about AI, there is a lot of humanoid hype out there. But our future doesn't run on hype; it runs on innovation. Watch season two on all these lovely channels, bringing you up-to-the-minute political news whenever and wherever it happens. I'm Joe Matthew on the south lawn of the White House. This is Bloomberg. The countdown is on. Everything you need to get the edge at the end of the market day. This is The Close. Welcome back to the close.

Analysis

The digital landscape is evolving with AI and quantum technologies, emphasizing the need for a cyber-first approach. As companies navigate this transformation, the focus on innovation over hype will be crucial for sustainable growth.

Investors should note that while AI advancements are generating excitement, the real value lies in companies that can effectively integrate these technologies into their operations. The emphasis on cybersecurity at major events like Gisec Global highlights the increasing importance of protecting digital assets in this new era.

13:08
PDT

Lululemon's revenue and outlook missed consensus estimates, impacting stock negatively.

Lululemon Zscaler DocuSign Heidi O'Neill Morgan Stanley Robinhood Snowflake Victoria's Secret Campbell's Soup General Mills Canagra Bloomberg News

– Zscaler's revenue beat expectations, leading to a significant stock price increase.

– Lululemon's new CEO will need time to implement changes, indicating a longer recovery period.

– Zscaler's strong guidance for future revenue suggests continued growth in enterprise software.

– Consumer sentiment appears positive overall, with consumer discretionary stocks leading gains.

retail performanceenterprise software growthconsumer sentimentmidterm election volatility

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Their product and their innovation continues to lag, and those are things that don't get fixed immediately. They take time. So even when she steps in, we're looking at six to twelve months at the minimum to see signs of a turnaround if that is the case. All right, so this is more of a medium-term turnaround story for Heidi O'Neill, the incoming CEO of Lululemon. Let's just step away from the retail space for a minute here because Zscaler, the enterprise software company, has also come out with results. And for the fourth quarter, it reported revenue of $898 million, beating the consensus estimate of $877 million, adjusted EPS of $1.19, also topping the consensus estimate of $1.09. As for the outlook, Zscaler sees 2027 revenue of at least $3.91 billion, up to $3.94 billion. So that is better than the anticipated $3.91 billion. And adjusted EPS of anywhere from $4.86 to $4.90, analysts were looking for $4.00 and $4.61, and that stock as a result is up more than 10% right now. We also have results coming out of DocuSign, which of course gained a lot of popularity during the pandemic. DocuSign saying second quarter revenue of $875 million, also topping the consensus assessment of $867 million, adjusted EPS $1.16 versus the average annual assessment of $1.09. Revenue for the quarter, for the upcoming quarter, this quarter, $886 million to $890 million. The midpoint of that seems to be the consensus.

Analysis

Lululemon's second quarter results missed expectations, with net revenue of $2.42 billion falling short of the consensus estimate of $2.46 billion, leading to an almost 8% drop in stock price. Zscaler, on the other hand, reported a strong fourth quarter with revenue of $898 million, exceeding estimates, and its stock rose over 10% as a result.

The incoming CEO of Lululemon faces a medium-term turnaround challenge, as product innovation is lagging and improvements may take six to twelve months. Zscaler's robust outlook for 2027 revenue suggests strong demand in the enterprise software sector, which could indicate a broader trend of resilience in tech spending despite economic uncertainties.

13:06
PDT

Lululemon's Q2 revenue missed estimates by $0.04 billion.

Lululemon Poonam Goyal Bloomberg Intelligence IPO EPS CEO Aura Health O-U-R-A PRIVATE

– Comp sales in the Americas fell 12%, worse than expected.

– Third quarter revenue outlook is significantly below consensus.

– Stock price dropped nearly 8% following the earnings report.

– New CEO's impact on strategy remains uncertain.

consumer demandretail sector performanceleadership impact

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I mean, as a consumer of Aura, I am quite a big fan. You get a lot of analytics; you track your sleep, you track your activities. So, I am not really surprised that this is the next step for Aura because it has been one of the leaders of that wearables market. A lot of the analytics that you get are very popular with consumers such as me. So, this would be a NASDAQ IPO, and the symbol would be O-U-R-A for an eventual IPO from Aura Health. All right, let's also take a look at Lululemon. The results have just come out. Third quarter results, actually let's start with second quarter results, because that was a quarter that ended with net revenue of $2.42 billion, missing the consensus estimate of $2.46 billion. Comp sales in the Americas, when you back out the effects, were down 12%, and analysts were looking for a drop of more than 10%. So, a worse than expected read there for the Americas. In terms of EPS for the second quarter, it was $2.92, while analysts were looking for $1.80. As for the outlook, Lululemon sees third quarter net revenue of $2.29 billion to $2.32 billion. That is a long way off from the consensus estimate of more than $2.5 billion. So, that is the outlook that's been cut there for Lululemon. And you can see the stock down almost 8% right now. Let's bring in Poonam Goyal. She is our senior e-commerce analyst over at Bloomberg Intelligence. These numbers do not look good, but I wonder given that the new CEO has not started.

Analysis

Lululemon's second quarter results fell short of expectations, with net revenue of $2.42 billion missing the consensus estimate of $2.46 billion, leading to an almost 8% drop in stock price. The company's outlook for the third quarter also disappointed, projecting net revenue between $2.29 billion and $2.32 billion, significantly below the expected $2.5 billion.

The worse-than-expected performance in the Americas, with comp sales down 12%, signals potential challenges in consumer demand and market positioning. Smart investors should note the implications of leadership changes, as the new CEO has yet to start, which may affect strategic direction and recovery efforts in the near term.

13:03
PDT

Tesla and SpaceX merger speculation persists.

Tesla SpaceX Ciena Corporation Victoria's Secret Campbell's Soup General Mills Canagra CNS TSLA CNS C I E N

– Ciena Corporation (CIE.N) down nearly 11% after earnings miss.

– Victoria's Secret down 13% on disappointing quarterly results.

– Campbell's Soup and General Mills also saw declines.

– High expectations can lead to sharp sell-offs in stocks.

earnings volatilityconsumer sentimenthigh expectations risk

▸ Full transcript

You're going to get guys. It's had a crazy ride on that Tesla. And of course, there's still all that speculation out there that Tesla and SpaceX will one day combine as well. So they won't be separate companies anymore. How about on the downside? I know it was much easier to pick the game. Well, I'm going to start with a CNS. C I E N is the ticker. So the worst performer in the S and P 500. If you look at this down close to 11 percent, it's worse day since June 4th. And then this is a communications equipment company. So reported quarterly results. It did expectations actually gave a revenue outlook that was above those instruments too but unfortunately vital knowledge was talking about how those expectations were just too high because it's stock still up about 40 percent this year so obviously it had some really strong gains relative to its peers so that's why you're seeing potentially some of that drawdown here too and then Victoria's Secret looking more in the retail consumer space I know you were just talking about the retail side to Scarlett how you want to keep a close eye on the polls of the consumer here down 13 percent it's worse day since April 2025 there. Unfortunately, it stocks actually up close to 60 percent year to date. But unfortunately, those quarterly results are underwhelming to advance to investors. And then Campbell's Soup, obviously, when you think about when it's flagship products for its soup and other beverage and food companies, as well as kind of in sympathy, General Mills and Canagra falling as well. But that's stocked down about, it's almost 7 percent. Worst day since May 11th, that unfortunately its earnings just...

Analysis

Tesla and SpaceX speculation continues as the companies may eventually merge, impacting investor sentiment. On the downside, Ciena Corporation (CIE.N) saw a significant drop of nearly 11% after reporting quarterly results that did not meet high expectations, despite a positive revenue outlook.

The market's reaction to Ciena's earnings highlights the risks of high expectations following substantial year-to-date gains, suggesting that investors may be overly optimistic. Additionally, Victoria's Secret and Campbell's Soup also faced declines, indicating a broader concern about consumer sentiment and retail performance as earnings reports underwhelm.

13:01
PDT

Consumer discretionary stocks are leading with a 1.6% gain.

Robinhood Snowflake Morgan Stanley Texas S&P 500 SNOW S&P 500 SNOW

– Robinhood and Snowflake both surged 16%, indicating strong market interest.

– 70% of stocks are advancing, reflecting positive market breadth.

– Financials are also higher despite lower yields, suggesting market relief.

– Sector-specific catalysts, like sports events, are influencing stock performance.

consumer sentimentmarket breadthsector performance

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Here and they're interesting. I mean, we're looking at some of the sectors that are leading today: consumer stocks right on top of that stack really tells you where risk sentiment lies is quite positive, and it's important to even you're just looking at breadth overall because we had close to about 70% of stocks advancing while just a little over 30% were declining. So just good to check in on where breadth is right now. Yeah, absolutely. All right, let's dig more into those sectors. As I mentioned, consumer discretionary is topping the leaderboard as we close here for cash equities, up about 1.6 percent. Financials are also higher there, a little surprising just because we got lower yields and lower interest rate expectations, but perhaps the overall relief from the markets is proving good for financial stocks here. I want to take a look at the gainers today. So on the top of the leaderboard for the S&P 500, we do have Hood, Robinhood, so the best gainer here today, up 16%. So this is the best day since April of 2025. So some context: that's when we were in the height of the tariff tantrum, and stocks did end up rebounding there. So actually, all it has to do with the prediction market growth that Morgan Stanley and some of these other upgrades that we've seen at banks recently as far as what that means, especially with football season coming up. So me being from Texas, obviously, you know, I think when it comes to that, especially college sports, but that's where you're seeing the strength there. And then I have to point out what happened with Snowflake today as well. SNOW is the ticker on this. So also it's up 16%, best day since late May. So not too far ago, but this is.

Analysis

Consumer stocks are leading the market with a 1.6% increase, indicating positive risk sentiment as nearly 70% of stocks are advancing. Notably, Robinhood and Snowflake both experienced significant gains of 16%, driven by market predictions and recent upgrades from banks.

The breadth of the market's advance suggests a strong underlying confidence, particularly in consumer discretionary sectors. The performance of Robinhood, linked to predictions around market growth and upcoming sports events, highlights the potential for sector-specific catalysts that could drive further investment interest.

13:00
PDT

Volatility expected leading up to midterm elections.

Courtney UBS Alignment Partners Jess Menton Bloomberg News Poonam Goyal Bloomberg Intelligence Lululemon UBS Alignment Partners And Poonam Goyal PRIVATE

– Historical trend shows potential equity rally post-election.

– Diversification strategies are being employed as a hedge.

– Analysts are cautious about immediate market reactions.

– Focus on regulatory impacts on various stocks and industries.

midterm electionsmarket volatilityequity rallydiversification strategies

▸ Full transcript

We expect, and historically going into midterm elections, you see volatility up until the election. Then, almost irrespective of the result, the concept of uncertainty falling away often leads to a rally in equities markets, even when there are not so many supportive tailwinds post that in late November and December. So I would say that's the one that we are sort of waiting to see what happens and what that means economically and from a regulatory perspective to different stocks or industries. But it's not one that we are actively positioning or acting like a hedge fund in terms of trading around; rather, we're using the benefits of geographical and cross-asset diversification to protect ourselves there. All right. I appreciate the honesty behind that response. Thank you so much. Courtney is the director of wealth management and private wealth advisor at UBS Alignment Partners. We are counting you down to the closing bell right now. Joining us for more market analysis is Jess Menton, a senior equities reporter for Bloomberg News. You can catch her writing here on the Bloomberg terminal. And Poonam Goyal, she's a senior U.S. retailing analyst at Bloomberg Intelligence, here to give us a reaction, certainly when Lululemon reports earnings after the closing bell and also just to give us a sense of the consumer and how the consumer is doing as we get into the fourth quarter.

Analysis

The market is anticipating a potential rally in equities following the midterm elections, historically characterized by increased volatility leading up to the event. Analysts are cautious, utilizing geographical and cross-asset diversification as a hedge against uncertainty, rather than actively trading around election outcomes.

Smart money should note that while the election results may not provide immediate supportive tailwinds, the reduction of uncertainty post-election often leads to a market rebound. This suggests that positioning for a potential rally could be prudent, especially in sectors that may benefit from regulatory changes.

12:58
PDT

Gold serves as a defensive asset and hedge against dollar weakness.

Allie McCartney UBS Alignment Partners Federal Reserve US gold short-duration bonds US dollar GC=F DXY FEDFUNDS

– Short-duration bonds are expected to yield higher returns as rates decline.

– Market volatility is anticipated due to Fed policies and inflation concerns.

– Investors are shifting focus from US dollar assets to alternatives like gold.

– The Fed's next move is projected to be lower rates, not higher.

defensive assetsinterest rate outlookde-dollarizationportfolio strategy

▸ Full transcript

You're quite optimistic on equity markets in particular, but I see that you're also buying gold and short-duration bonds. That to me sounds like a more defensive play, but is there more to that trade than meets the eye? Well, let's start with gold. Gold is something I've had in my client's portfolio for a few years now, and obviously that has worked really well. I would say it's partly defensive, partly ballast, right, for your equity portfolio, but it is partly a play on a lot of the things that we've just talked about: a waning dollar, a sort of de-dollarization, countries being less interested in buying US debt and US dollar-denominated assets, and therefore more of a bid for gold. And on the short-duration bonds, we continue to have a view that interest rates in terms of the short rates that the Fed is going to, their next move is going to be lower, not higher. We don't think that that is going to be until 2027. But we are not of the school of thought right now that the next move is higher. And so based on that, we continue to expect interest rate volatility because of A, what we're seeing with the Fed in the inflation market, et cetera. But we do think that the path is such that ultimately buying those bonds now will allow clients to lock in not only that ballast but a higher yield in the next few years. You mentioned a lot of the risks that kind of percolate out there that.

Analysis

Gold is being positioned as both a defensive asset and a hedge against a waning dollar, reflecting a shift in global interest away from US dollar-denominated assets. Short-duration bonds are favored due to expectations of lower interest rates from the Fed, with a view that volatility will persist but ultimately lead to higher yields for investors.

Smart money should note the dual role of gold as a ballast in equity portfolios while also serving as a response to de-dollarization trends. The expectation of lower short rates until at least 2027 suggests a strategic opportunity to lock in yields now, which could enhance portfolio resilience amid ongoing market volatility.

12:55
PDT

S&P 500 earnings growth projected at 24% for the year.

S&P 500 U.S.China Ali McCartney UBS Alignment Partners Treasury Federal Reserve Bank of Japan AI US USDCNH S&P 500

– Average company earnings growth expected around 15%.

– Concerns about inflation and interest rates persist.

– Market confidence bolstered by broad-based earnings growth.

– No significant multiple expansion observed in the past year.

earnings growthmarket breadthinflation concernsinterest rates

▸ Full transcript

And I think just like we've seen with AI and technology companies, the sort of top 10 titans, you can't grow at these abounding rates forever. But we do see this continuing and not only continuing in the US, but continuing in Europe and continuing in emerging markets in China. So we are anticipating a 24% earnings growth this year for the S&P 500. And I think what is most notable about that and giving the market the most confidence is the breadth of those earnings, right? So we're not talking about 10 stocks growing at 150% and everything else, either barely growing or shrinking. We're talking about the average company growing about 15% this year on earnings based on a lot of the productivity growth and the increased marginability we're seeing as a result. We see a number not so you know a little bit less but maybe 14 to 15 percent next year. And so to me which is probably your next question which side of that seesaw my arm certainly reason to be concerned about inflation worried to be concerned about rates from every perspective from our debt you know the U.S. debt going over 40 trillion best in coming in on the Treasury but it's hard to get you know it's hard to look at that earnings picture and understand that we haven't even really seen multiples expansion in a year and not be bullish. Yeah, well, very interesting, Ali. Seems like we are really in a...

Analysis

The S&P 500 is anticipated to see a 24% earnings growth this year, driven by broad-based productivity improvements rather than reliance on a few high-performing stocks. Despite concerns over inflation and rising interest rates, the overall earnings picture remains bullish, with average company growth projected at around 15%.

Smart money should note that the earnings growth is not concentrated among a handful of companies, indicating a healthier market environment. Additionally, the lack of multiple expansions over the past year suggests potential for further upside in valuations as economic conditions stabilize.

12:53
PDT

10-year Treasury yield at 4.76%.

U.S. Treasury Federal Reserve Bank of Japan Allie McCartney UBS Alignment Partners Middle East WTI BOJ UBS Treasury Secretary Allie Mc Managing Director DXY FEDFUNDS CL=F

– Dollar weakened 1.9% against the yen.

– Concerns about interest rates and geopolitical tensions.

– U.S. equities remain strong amid mixed sentiment.

– Oil prices influenced by Middle East conflict.

interest rate environmentgeopolitical tensionsU.S. equity market

▸ Full transcript

We're also seeing a little bit of a breather in the Treasury sell-off. This is really a global sell-off that we've been seeing in bonds overall. The 10-year yield is currently at 4.76 percent. But watch this space because the big jobs report comes out tomorrow at 8:30 a.m. Oil prices have been bouncing around; you can see WTI now at 91 and change. The dollar is weaker, and you can look at that big move in dollar yen. It's not normal to see a 1.9% drop in the dollar versus the Japanese yen. There's a lot of talk about intervention and whether the Federal Reserve and the Bank of Japan will be raising interest rates anytime soon. A BOJ board member did strike a hawkish tone, and we know the Treasury Secretary is certainly encouraging them to raise interest rates as well. For more market analysis, let's welcome Allie McCartney. She is Managing Director of Wealth Management and Private Wealth Advisor at UBS Alignment Partners. Allie, good to speak with you. Just give us a sense of what the conversations you're having with your clients are like right now on the heels of what's been another blockbuster year for U.S. equities. Yeah, I mean, we're talking about the third year that's been a blockbuster year. So there is both general enthusiasm about everything from earnings to secular growth and technological evolutionary tailwinds to a lot of real concern about the interest environment, the conflict in the Middle East, and what that's doing to oil. So it really has been in a sense like as we've seen.

Analysis

The U.S. Treasury sell-off is showing signs of a breather, with the 10-year yield currently at 4.76%. Meanwhile, the dollar has weakened significantly against the yen, prompting discussions about potential intervention and interest rate changes from the Federal Reserve and the Bank of Japan.

Investors are expressing enthusiasm about U.S. equities, driven by strong earnings and technological growth, but there are underlying concerns regarding the interest rate environment and geopolitical tensions affecting oil prices. The mixed sentiment suggests that while the market is buoyant, caution is warranted as external factors could impact future performance.

12:51
PDT

OpenAI has filed confidentially for a potential public offering.

OpenAI Sam Altman Anthropic Ed Ludlow Bloomberg META PRIVATE

– Altman stresses the importance of societal benefits over shareholder returns.

– The AI industry struggles with effectively conveying its advantages to the public.

– Training AI models remains a costly and complex endeavor.

– Competitors like Anthropic may lead the way in going public.

AI industry dynamicspublic offering strategies

▸ Full transcript

The timetable for going public is delicate, and it is accepted that Anthropic will be the first mover between the two models to go public, possibly in September or October, with OpenAI following after. OpenAI has filed confidentially, stating that going public is one of several available avenues and that they have a number of financial strategies. However, the reality is that the public markets require financial discipline. Training models is complicated and expensive on both the compute and talent sides, making the release of powerful models challenging. These goals may not always align with the profitability expectations of a public company. I was trying to get from Sam Altman a sense of the priority if they go public: the duty to shareholders or what it takes to release the models. He maintained a cautious stance, indicating that an update on the timeline was not realistic at this point. We will wait and see.

Analysis

OpenAI's CEO Sam Altman indicated that the company is considering going public, with a potential timeline that could align with competitors like Anthropic. However, he emphasized that the priority will remain on societal benefits and technological advancement rather than solely on shareholder returns.

The AI industry faces challenges in effectively communicating the benefits of its technology to the public, which could impact adoption rates. Altman's commitment to maintaining a long-term mission-oriented approach suggests that OpenAI may prioritize innovation over immediate profitability, a stance that could attract investors focused on sustainable growth.

12:49
PDT

AI industry struggles with effective communication of benefits.

Sam Altman OpenAI Greg Rockman Astra Treasury Secretary Scott Besson AI Treasury Secretary

– Astra model enhances task delegation and cybersecurity capabilities.

– OpenAI plans to continue reducing prices for competitive advantage.

– Long-term societal benefits prioritized over short-term profits.

– Market perception of AI technology remains cautious due to safety concerns.

AI communicationCybersecurity advancements

▸ Full transcript

There are lots of benefits to it. And it's like the benefits of that, that Sam, in line with others in his industry, seem to be agreeing that hasn't been conveyed very well. Like this could help. It could improve productivity. It could improve your life, free you up to do things outside of the workload on your desk, Scarlett. But it's interesting just the sheer acknowledgment. It was in the context of the Treasury Secretary making the point in the first place. But he couldn't have been clearer that he agreed with the position. Now I had the OpenAI president Greg Rockman calling this new model a real shift in what kind of work people can delegate to AI based on his comments and what you got from Sam Altman as well. Do you think that is actually true or is this just a little bit of marketing speak? So in very simple terms what Astra is good at according to OpenAI is doing work on a computer on a human's behalf. So if you can think of some of the things Christine that you do on a computer each day that you sit there and type. If you had the capabilities of Astra, a lot of that can be done for you. At the other extreme, this is a very cybersecurity-focused model as well, where the specific guardrails on this version of it that have been early released relate to that cyber capability. And what Mr. Altman was going through in that conversation is that it is of great benefit in the context of cyber defense. The risk, as is always the case right now in any model that is released.

Analysis

OpenAI's CEO Sam Altman acknowledged the AI industry's failure to effectively communicate the benefits of AI technology, particularly in enhancing productivity and improving lives. The introduction of the Astra model is positioned as a significant advancement in AI capabilities, particularly in cybersecurity and task delegation, which could reshape how individuals interact with technology.

Smart money should note that the emphasis on cybersecurity within Astra may attract interest from sectors focused on digital security, potentially leading to increased demand for AI solutions in that space. Additionally, OpenAI's commitment to lowering prices while enhancing capabilities suggests a competitive landscape that could pressure other AI firms to adapt their pricing strategies.

12:47
PDT

OpenAI prioritizes mission over immediate financial returns.

OpenAI Sam Altman Bloomberg CEO AI Bloomberg Television And Ed Lodlow PRIVATE

– Long-term strategy may involve significant investment in technology.

– The AI industry needs better communication of its benefits.

– Pricing strategies are aimed at making AI more accessible.

– OpenAI plans to continue reducing prices for its models.

AI industry communicationlong-term investment strategy

▸ Full transcript

If you staying ahead in the race that you've just outlined requires OpenAI to just keep investing more heavily, maybe than expected, to keep pushing out the boundaries of what the models are capable of doing, the cadence of release. Where do you sit right now on your considerations of doing that as a private company versus doing that as a public company where the sort of financial incentive and fiduciary duty of being a public company isn't necessarily the same as being committed to developing the technology, getting the technology released out into the world? If we do go public someday, which I assume we will, I plan to spend a lot of time reminding people who might want to buy or might not want to buy our stock that we are mission-first and that we're also extremely long-term oriented. So we are going to make decisions for what we think is best for society as a whole with this technology and we're going to make decisions on a multi-decade time frame and we think we'll do really great as a company but we're going to put those things first. OpenAI CEO Sam Altman with us live on Bloomberg Television thank you very much indeed. Thank you. And Ed Lodlow is going to stick around for us and break down some of the comments that Sam Altman, the CEO of OpenAI, just shared with him. Ed, I really appreciated your asking about what the AI industry at large could do better and could improve upon, especially in communicating the benefits of AI.

Analysis

OpenAI CEO Sam Altman emphasized the company's commitment to a mission-first approach, prioritizing societal benefits over immediate financial incentives, especially in the context of a potential future IPO. He acknowledged the AI industry's struggle to effectively communicate the benefits of AI technology to the public, indicating a need for improved messaging to alleviate public concerns.

Smart money should note that OpenAI's long-term strategy may lead to sustained investment in technology development, potentially at the expense of short-term profitability. This focus on societal impact could differentiate OpenAI in a competitive landscape, influencing investor sentiment and market positioning as the AI sector evolves.

12:45
PDT

Astra model aims for low-cost, high-performance AI.

OpenAI Sam Altman Astra Luna Thropic G20 Scott Besson AI DXY

– OpenAI plans to continue cutting prices significantly.

– Token efficiency of Astra is notably impressive.

– The company is focused on empowering users with AI technology.

– Competition with other AI labs is influencing pricing strategies.

AI democratizationPricing strategyCompetitive landscape

▸ Full transcript

Enable each other with. And I think that has been lost in the messaging. And I also think there's some companies that have a different opinion there. But it's very, very important to us that this technology is something where people get more power and more autonomy, not less. And I think people rightly get afraid when they feel like AI leaders might not quite want that for them. Sam, that's in part why I wanted to ask you about pricing on Astra, but also just generally, right? I think the direction of travel has been that you've cut prices. There is competition, of course, with the other frontier labs and Thropic. But how much is that the balance of access to the technology? You need to move quickly in releasing the technology and also still trying to find fair market value of how you price the technology. We want to create incredibly capable, incredibly low cost, incredibly abundant intelligence. And I think Astra is a great step forward there. The token efficiency of Astra is so impressive to me. The amount of work you can get done with a relatively small amount of tokens and the kind of the price per dollar of a task that you might like, I think it's just remarkable. Only a few weeks ago, we cut the price of Luna, our small model by 80%. And our goal is to have the best price performance at every level of intelligence all the way along the curve. We will continue to keep dropping prices dramatically. I'm confident in the shape of the technology and the work we're doing to enable that to happen.

Analysis

OpenAI's Astra model is set to revolutionize access to AI technology, with a focus on affordability and efficiency. The company aims to cut prices significantly while enhancing the capabilities of its models, positioning itself competitively against other frontier labs.

The emphasis on low-cost, high-performance AI indicates a strategic shift towards democratizing access to advanced technology. This could lead to increased adoption across various sectors, potentially reshaping market dynamics and competitive landscapes in the AI industry.

12:43
PDT

AI industry struggles with public communication.

OpenAI Sam Altman Scott Besson G20 AI Treasury Secretary Scott Besson

– OpenAI aims to empower users while addressing risks.

– Regulatory scrutiny may increase as public concerns grow.

– Trust-building is essential for AI adoption.

– Future AI models will focus on user autonomy.

AI communicationPublic perceptionRegulatory scrutiny

▸ Full transcript

With AI, there are a lot of edges that we're now going to have to feel our way through, and giving people autonomy and freedom to use AI is important to our mission. Sam, at the G20 this week, Treasury Secretary Scott Besson said that the AI industry had done a terrible job of explaining how AI benefits ordinary Americans. What's your view of that, and whether you would, on reflection, consider OpenAI to be in that bucket? I think the industry has done a terrible job of this on the whole. I think we have done a bad job ourselves, maybe better than some others, worse than some others. It is difficult, of course, to explain that the world should, in my opinion, want us to worry a lot about this technology. The world should want us to think about all the ways that could go wrong, to talk about what we see coming, but not to stir up doom or concentrate power for ourselves just because in the history of technology, the way you solve the hard problems is to look at them, talk clearly about them, have scientists debate them, and work really hard to prevent and mitigate them. That has been our intention. But clearly, sometimes it ends up scaring people. Now, there's another thing that I think has gone really bad, besides talking about the ways this could go wrong, which is I don't think we've done a great job as an industry of really talking about how to empower people with this technology.

Analysis

OpenAI's CEO, Sam Altman, acknowledged the AI industry's failure to effectively communicate the benefits of AI to the public, suggesting a need for better engagement and transparency. He emphasized the importance of addressing potential risks while also empowering users with AI technology, indicating a shift in focus for the industry moving forward.

Smart money should note that the AI sector is under pressure to improve public perception and trust, which could influence regulatory approaches and investment strategies. The acknowledgment of past communication failures may lead to a more proactive stance in addressing societal concerns, potentially impacting the adoption and integration of AI technologies across various sectors.

12:41
PDT

OpenAI's Astra model incorporates safety measures for responsible AI use.

OpenAI Sam Altman GPT-6 Astra CEO PR AI PRIVATE

– Monitorability is prioritized over maximizing capabilities in Astra's design.

– Public concerns about AI risks could lead to increased regulatory scrutiny.

– The debate over acceptable AI functionalities reflects broader societal challenges.

– Investors should watch for shifts in market sentiment regarding AI technologies.

AI safetyregulatory scrutiny

▸ Full transcript

We are able to make with a model. But monitorability is an important thing, and we've been talking, I think, for well over a year now, about the importance of chain of thought monitoring and how we have made various decisions there that help us preserve chain of thought monitorability, even if it means we don't maximize the capabilities we could otherwise get. And we think that is important. It's an important component. We also want to be clear. We don't think that's the only component that matters. We're live on Bloomberg television and on Bloomberg radio, and we're speaking to Sam Altman, the CEO of OpenAI. There's a lot of bad PR in the world around AI at the moment, with everyday citizens worrying about the impact. One way I wanted to put that to you is whether you can say unequivocally that if Astra or any future generation model behaved in a way that was dangerous, that you would be able to detect it and then shut it down. The obvious hard part of that question is that people have different opinions about what models should be able to do and shouldn't be able to do. We think there are some things that very clearly models should not be able to do. There are some clear red lines. And we talk a lot about being able to detect those. But people also have strong opinions about things within the broad bounds of what is possible about how they use AI and how they want to be able to use AI. And this is going to be a difficult question for society because there is not going to be agreement on what is and isn't.

Analysis

OpenAI's CEO, Sam Altman, emphasized the importance of monitorability in AI models, particularly with the release of GPT-6 Astra, which aims to balance capability with safety. He acknowledged the challenges in detecting dangerous behaviors in AI, highlighting the societal debate over acceptable AI functionalities.

Smart money should note that while Astra is designed with safety measures, the ongoing public concern about AI's risks could impact regulatory scrutiny and market sentiment. The emphasis on chain of thought monitoring suggests a strategic pivot towards responsible AI development, which may influence investor confidence in AI-related stocks.

12:38
PDT

GPT-6 Astra rollout includes cybersecurity guardrails.

OpenAI Sam Altman GPT

– Model paused for enhancements after identifying zero-day exploit capabilities.

– OpenAI emphasizes collective defense against cyber threats.

– Different tiers of access will be provided based on verification levels.

– The landscape of cyber attacks is expected to change significantly.

cybersecurityAI technology

▸ Full transcript

We will have different tiers of cyber access for this model for cyber in particular. Today, we're rolling it out to trusted access partners. And then in the coming days, assuming everything goes well, we'll roll it out more broadly. You could say, well, if this model has a cyber problem, why let anyone use it for cyber? And I think it's very important to note that the world is very close to a complete change in the landscape of cyber attacks. The only way that we see for society to collectively defend itself against this coming wave of models from around the world and from other companies is to use tools like Astra to rapidly defend against these new kinds of cyber threats. So we will have multiple programs for people at sort of different levels of verification and trust. It gets quite important that the world use these models to collectively defend ourselves. What happened prior to release is important, right? You determined that Astra confined and developed zero-day exploits without any human intervention, essentially. And so you paused some of the work to strengthen the safeguards. What specifically was it that you saw that made you hit pause, the behavior, I suppose, of the model? So it's worth pointing out that the model that we're launching today is GPT-6 Astra has been done training for a while. The model that...

Analysis

OpenAI's new model, GPT-6 Astra, is being rolled out with specific cybersecurity guardrails to address potential risks associated with its capabilities. The model's ability to autonomously develop zero-day exploits prompted a pause in its release to enhance safeguards, highlighting the urgent need for collective defense against evolving cyber threats.

Smart money should note that the introduction of Astra reflects a significant shift in the cybersecurity landscape, where advanced AI models are both a tool for innovation and a potential risk. The proactive measures taken by OpenAI indicate a growing recognition of the dual-use nature of AI technology, which could influence investment strategies in tech and cybersecurity sectors.

12:36
PDT

OpenAI's GPT-6 Astra aims to enhance user trust and functionality.

OpenAI Sam Altman DIY

– The model can handle complex tasks, potentially transforming workflows.

– Cybersecurity guardrails are included to mitigate risks.

– Increased user confidence may drive demand for AI solutions.

– Astra's capabilities could impact productivity in finance and tech sectors.

AI advancementsproductivity enhancement

▸ Full transcript

This is the first model to me where I could sort of tell someone, like, just give it a try. There's a good chance it'll work. I've watched people make computer games. I've watched people do sort of like home DIY electrical engineering projects. I've watched people do very complex simulations for some piece of science they're working on. Certainly, a lot of the work where you would sort of normally sit down, have to build a financial model here, and then a PowerPoint presentation around it, and then figure out how to make a little interactive piece of code to try different simulations. That stuff is all so doable now. What I hope will happen is people, I think people will be surprised at the beginning, but then as they build up more trust in the model and more like, wow, I can really do this, just start throwing harder and harder tasks and more creative ideas at it, and they will find out what the model can really do for them. So the specifics of how Astra is being released, I think it's important. So a version of it with specific guardrails, what was the thinking behind that, and what are those specific guardrails in this early release of it? Yeah. So the challenge of our industry is that we have these models that are getting incredibly capable and incredibly useful and that people want to use to everything from, you know, make their lives a little easier to starting new companies.

Analysis

OpenAI's latest model, GPT-6 Astra, is being positioned as a significant step towards artificial general intelligence (AGI), showcasing its capabilities in various complex tasks. The introduction of specific cybersecurity guardrails reflects the company's awareness of the risks associated with powerful AI models, aiming to build user trust while enhancing functionality.

Smart money should note that the model's potential to simplify complex tasks could lead to increased productivity across sectors, particularly in finance and technology. As users gain confidence in Astra's capabilities, demand for advanced AI solutions may surge, impacting investment strategies in tech and AI-driven companies.

12:32
PDT

Current annualized CAPEX is $1.7 trillion, a 42% increase year-on-year.

S&P 500 NASDAQ 100 Visible Alpha Scarlett Christine CAPEX S&P 500 NASDAQ 100 FEDFUNDS DXY

– Expectations for CAPEX spending to rise by nearly $1 trillion.

– Concentration of spending among a few companies with strong earnings.

– High investment intensity typically correlates with stronger earnings growth.

– No significant disconnect between current earnings and CAPEX spending.

CAPEX growthinvestment intensityearnings correlation

▸ Full transcript

Great to be on the close with you, Scarlett and Christine. As you said, we are in unprecedented waters here. We're seeing a CAPEX spend that we really have never seen before. And it's really not just what's being spent today, but what the expectation looks like. We're already at roughly $1.7 trillion of annualized CAPEX across the S&P 500 and the NASDAQ 100. That number represents a 42% year-on-year growth, but really it's about what's coming next. Visible Alpha consensus sees that spend rising by almost a trillion dollars from here. And as you point out, more than half of that is coming from a concentrated set of companies. Does it represent a concentration risk? It's hard to say. Right now the big spenders are also the ones with the earnings to back it up. So unlike some of the prior periods where we've seen CAPEX intensity like this, there doesn't seem to be as much of a disconnect between the earnings coming in and the CAPEX that's being spent, at least not yet. At least not yet. You say that periods of high investment intensity have typically coincided with stronger earnings growth, elevated earnings expectations, positive equity returns, and higher federal funds rates, higher interest rates. What is that actual relationship? Is there a correlation or is there actual causation? So the framework we live in.

Analysis

The current CAPEX spend across the S&P 500 and NASDAQ 100 has reached approximately $1.7 trillion, reflecting a 42% year-on-year growth, with expectations for an additional trillion dollars in spending. This surge is primarily driven by a concentrated set of companies that currently have the earnings to support such investments, indicating a potential shift in market dynamics.

Smart money should note that periods of high investment intensity have historically aligned with stronger earnings growth and elevated equity returns. The current correlation between CAPEX and earnings suggests that the market may not be as vulnerable to concentration risks as in previous cycles, at least for now.

12:30
PDT

U.S. semiconductor firms are leading in design and manufacturing over China.

Broadcom SpaceX Tesla China Chris King Skyworks Solutions OpenAI Sam Altman Bloomberg Power Players New York Michael Mc PRIVATE

– Supply constraints are prompting investments in new production facilities.

– Hyperscalers are increasingly turning to debt for financing expansions.

– Acquisitions of software assets by semiconductor companies are on the rise.

– The semiconductor supercycle will continue until capacity constraints are resolved.

semiconductor growthinvestment trendssupply chain dynamics

▸ Full transcript

Join us. Bloomberg Power Players, New York, September 10, 2026. He touches on everything that we carry around: the economy, media and information, markets, trade, and geopolitics. The most important news and financial information, whenever and wherever it happens. I'm Michael McKee on the Mexican border, and this is Bloomberg.

Analysis

The semiconductor industry continues to show strong growth potential, with U.S. companies maintaining a lead over China in both design and manufacturing capabilities. The ongoing supply constraints are driving investment in new production facilities, indicating a bullish outlook for the sector despite concerns over potential over-leverage among hyperscalers and semiconductor firms.

Smart money should note the increasing trend of semiconductor companies acquiring software assets, which could enhance their product offerings and competitive edge. Additionally, the current supercycle in semiconductors is expected to persist until capacity constraints are fully alleviated, suggesting a prolonged period of investment and innovation in the sector.

12:26
PDT

Semiconductor supercycle still ongoing.

Chris King Skyworks Solutions OpenAI Sam Altman CEO AI CAPEX Alright Chris Breaking Through Silicon Ceiling

– Capacity constraints are the main limiting factor.

– Investments in adjacent software assets are increasing.

– High capital expenditures in AI are driving economic activity.

– Supply constraints will shape the AI trade landscape.

semiconductor supercycleAI investment trends

▸ Full transcript

I'm really interested in these acquisitions with semiconductor companies buying software assets or other assets that are adjacent to their specific product line, and I think that's a great trend as well. Alright Chris, final question, we only have 30 seconds. We are still very much at the peak of the semiconductor supercycle. What are you looking for to mark the end of that? Oh, so you asked me that before, and I think it's a hard one. I think it's when we start seeing no constraints on capacity, that everyone has what they need, then you know it's going to be over soon. All right. Chris, very, very bullish on the road ahead here for the industry that she's been such a pioneer in. Chris King is chairman of Skyworks Solutions. She is the author of Breaking Through the Silicon Ceiling. Quite some perspective from both her as well as our previous guest, the CEO of about how the real constraint here is, you know, just the ability to deliver on everything that people want. Yeah, absolutely. It is very much a supply story. It looks like that's going to be the narrative heading into 2027 as well, which is going to be very interesting in terms of sifting out the winners and losers in the AI trade. Absolutely. And our first guest was talking about how, you know, if you back out the CAPEX into AI and everything else, the economy hasn't really done a whole lot because it's all being driven by all this capital expenditure. So we're going to put this all into context here when it comes to the markets. Coming up, a live interview with OpenAI's CEO Sam Altman on the latest with his company and the AI landscape in the U.S.

Analysis

The semiconductor industry remains in a supercycle, with constraints on capacity being the primary limiting factor. As companies invest in adjacent software assets, the landscape is evolving, indicating a bullish outlook for the sector's future.

Smart money should note that the current capital expenditures in AI are driving economic activity, suggesting that underlying growth may be more robust than it appears. The focus on supply constraints will be crucial in identifying winners and losers in the AI trade heading into 2027.

12:24
PDT

Siena expects 30% growth next year, driven by supply.

Siena Gary Smith Chris King Skyworks Broadcom SpaceX Tesla China IBM

– The semiconductor industry is in a boom phase, with strong demand.

– Hyperscalers are increasingly using debt to finance infrastructure.

– U.S. semiconductor companies maintain a lead over China.

– Custom silicon trends are emerging among hyperscalers.

supply chain riskdebt financingsemiconductor demandU.S. market leadership

▸ Full transcript

Energy and power infrastructure has been very regulated. I myself have been on a power company board, and I think that we, as we always do, a reduction in regulation would be really helpful because I think we're going to have to use some new thinking and innovation in our overall grid and all the new power sources that will become available to us. All right. And you know, one of the themes as well that we've seen, Chris, is the idea of the money being used to finance the build-out, right? I mean, a lot of hyperscalers are very much cash-rich. They've been drawing down those cash flow reserves to finance this. But now we're seeing this trend as well of turning to debt to get the funding. When does that become a worry, or is it ever going to become a worry for investors? I think that we see this being viewed as an investment. And so I think the high price is going to be a big one. So I think the hyperscalers, as well as even some of the semiconductor companies that are helping finance some of the new large language model companies, finance this bill that is very interesting. So I think it's heartening that they want to invest in this. Now obviously we don't want anybody to become over-leveraged, but clearly I think it's a good sign. Chris, what do people, and this could be folks in adjacent industries or investors or even policymakers, continually misunderstand about the semiconductor industry today and including five, you know, five, ten, fifteen years ago?

Analysis

Siena's growth is primarily driven by supply constraints rather than demand, with a projected baseline growth of 30% for next year. The semiconductor industry is experiencing a boom, with significant demand for custom silicon and a strong U.S. lead over China in design and manufacturing capabilities.

Investors should note the shift of hyperscalers from cash reserves to debt financing for infrastructure buildouts, which could signal a strategic investment approach rather than a risk of over-leverage. The ongoing demand for semiconductors, particularly in AI and power management, suggests a prolonged growth cycle in the industry.

12:22
PDT

Broadcom is partnering with hyperscalers and AI companies.

Broadcom SpaceX Tesla China U.S.AI TSLA USDCNH

– U.S. semiconductor firms maintain a lead over China.

– Custom silicon trends are emerging among hyperscalers.

– Supply constraints are driving investment in new production facilities.

– The semiconductor boom is expected to continue for an extended period.

semiconductor supply chaincustom siliconU.S.-China tech competition

▸ Full transcript

Processors, we see the XPUs, where a company like Broadcom partners with the hyperscalers, as well as the AI companies. Then we see these companies getting into their own semiconductor capability, not just design, but also fabrication. I think a great example of that is the TerraFab, when we talk about SpaceX and Tesla requirements for tons of semiconductors. So I think it's a very interesting trend and I do think it will be disruptive. One of the trends that we're seeing as well is in terms of the geographic divide. We have a lot of U.S.-listed and U.S.-based chip makers and hyperscalers really taking the lead here. For instance, a country like China may still be a few years behind on those trends, but how durable is the U.S. lead in this space? When do you think we might see China starting to catch up? I think for sure China has been catching up incrementally all the time, but in every cycle, I think we've seen the U.S. lead, particularly in semiconductors in not only design but manufacturing expertise. I think we're going to see that continue. So I see the U.S. being in the lead for quite some time to come. When there are supply constraints like there is right now, manufacturers can invest in new production facilities to meet that demand. How quickly can a chip manufacturer build up that capability? Has that timeline?

Analysis

The semiconductor industry is witnessing a significant shift as companies like Broadcom partner with hyperscalers and AI firms, leading to increased in-house semiconductor capabilities. Despite China's incremental progress, the U.S. is expected to maintain its lead in semiconductor design and manufacturing for the foreseeable future.

Smart money should note the growing trend of custom silicon among hyperscalers, which could disrupt traditional semiconductor supply chains. Additionally, the current supply constraints may prompt manufacturers to rapidly invest in new production facilities, impacting timelines for capacity expansion.

12:20
PDT

The memory chip boom is still in early innings.

Chris King IBM AI GPUs XPUs memory chips hyperscalers

– Demand is driven by AI and emerging technologies.

– Custom silicon design by hyperscalers is on the rise.

– Multiple demand drivers are present, indicating prolonged growth.

– Traditional markers for peak cycles may be hard to identify.

semiconductor growthcustom siliconAI demand

▸ Full transcript

You've clearly seen your share of boom and bust cycles in this industry. Where do you think in the cycle we are right now in the current memory chip boom? Are we close to the peak or are we near it? I don't think we're anywhere near it, and I've seen so many cycles from PCs to the internet to mobile devices and now the AI boom, and it's really exciting. I don't think I've seen a time where we've expressed demand in things like gigawatt capacity. So it's a very exciting time. I think we're in early innings. And as your last guest said, I think we're even earlier in the buildout to the edge. How will we know when we are at or near the peak or past the peak? What will be the markers? Oh, I think it's always tough to see those markers because it kind of falls off a cliff, but there are so many aspects to this boom and so many different demand drivers that right now we talk about processors, GPUs, and XPUs in memory as the main thing. But I think as we see this continue on, we're going to see other areas like power supply management and connectivity that are all ancillary. And so I think it's gonna take quite a while till we see the roll-off of this cycle. Yeah, well Chris, I mean, one of the trends that are emerging now in this space, right, is this whole idea of custom silicon, where a lot of hyperscalers are designing more and more of their own chips. How disruptive!

Analysis

The semiconductor industry is currently in the early stages of a memory chip boom, with demand driven by AI and other technologies. The speaker believes that the peak of this cycle is still far off, indicating a prolonged period of growth ahead.

Smart money should note that the demand for custom silicon is rising, as hyperscalers increasingly design their own chips, which could disrupt traditional supply chains and create new competitive dynamics in the market. This shift may lead to a diversification of demand drivers beyond just memory and processing units.

12:18
PDT

Sienna beat Q3 expectations and raised Q4 revenue outlook.

Sienna Gary Smith AI Gisec Global Bloomberg IBM ETF IQ Middle East Prime Minister PRIVATE DXY

– Market reaction suggests skepticism towards AI infrastructure stocks.

– Sienna's growth is limited by supply, not demand.

– Projected baseline growth for next year is 30%.

– AI infrastructure build-out will drive optical capacity expansion.

AI infrastructuresupply chain constraintssemiconductor industry

▸ Full transcript

A new digital order isn't defined by technology alone. As sovereign AI reshapes digital independence, as agentic AI transforms decisions, as quantum unlocks new possibilities, every breakthrough demands a cyber-first mindset. That's why the future meets at Gisec Global, the Middle East and Africa's largest cyber security event. We shape policy and power innovation. We protect the digital order. Context and clarity you need. A broad vision here from the new Prime Minister. Here at first on Bloomberg. It's a multi-trillion dollar industry. We'll show you what's happening in ETFs like no one else. ETF IQ Mondays on Bloomberg. Our next guest has spent more than 50 years in the semiconductor industry. Roughly half of that at IBM.

Analysis

Sienna's CEO Gary Smith highlighted the company's strong Q3 results, beating street expectations and providing an optimistic revenue outlook for Q4 despite supply constraints. The market's reaction, however, reflects a broader skepticism towards AI infrastructure stocks, as investors differentiate between potential winners and losers in the sector.

The key insight is that Sienna's growth is primarily constrained by supply rather than demand, with a projected baseline growth of 30% for next year. This indicates that securing supply will be critical for Sienna to capitalize on the ongoing AI infrastructure build-out, which is expected to drive significant optical capacity expansion globally.

12:16
PDT

Siena expects 30% baseline growth next year, contingent on supply.

Siena Gary Smith Skyworks AI CEO Chris King PRIVATE

– Current growth is driven by supply issues, not demand.

– 35% growth achieved this year indicates strong momentum.

– AI infrastructure spending is a key market driver.

– Supply chain management is critical for future growth.

supply chain riskAI infrastructure investment

▸ Full transcript

The key driver of Siena's growth next year is going to be the acceleration in AI infrastructure spending, do you think? It's actually going to be supply. I mean, we've got visibility to next year. We already talked about early indications, even though we haven't finished this fiscal year, we gave early indications that a baseline growth for next year is 30%. We grew about 35% this year; we could grow even greater than that 30% if we can secure more supply, which we're working through. So, you know, it's not about demand in the optical network space; it's about supply. Very much a supply story. Alright, thank you so much, Gary, for your time. That is Gary Smith, CEO and president of Siena. Now coming up, we'll get a bird's-eye view of the evolving tech landscape from Chris King, chairman of Skyworks and the world's first female CEO of a semiconductor company. This is the close on Bloomberg.

Analysis

Siena's growth is primarily driven by supply constraints rather than demand, with early indications suggesting a baseline growth of 30% for next year. The company has already achieved 35% growth this year, indicating potential for even greater expansion if supply issues are resolved.

Smart money should note that the optical network space is currently facing significant supply challenges, which could impact growth trajectories across the sector. This highlights the importance of supply chain management in capitalizing on the ongoing AI infrastructure investment boom.

12:14
PDT

AI infrastructure investment is expected to grow significantly without major downturns.

Sienna Gary Smith AI

– Sienna is positioned as a critical enabler in the AI space.

– Market volatility may lead to cautious lending practices.

– Labor market dynamics could influence AI CapEx sustainability.

– Valuations are tight, indicating potential caution among investors.

AI infrastructure growthcredit market dynamics

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As it scales up through training into inference and then through to agentic use of AI and then, you know, eventually into robotics, it's all about the network. The network is now the critical path. Right. Gary, you said in the press release that you talked about AI driving compounding waves of network investment. That suggests that even within this once-in-a-generation AI infrastructure build-out, there is a waxing cycle and a waning cycle as well. Talk about what that actually looks like. How long those waxing moments last, how long those waning moments, when they do come, will last? I don't think you're going to get many waning moments, frankly, and that's what I mean by this sort of compounding effect to it. What you're seeing right now is the establishment of sort of a cloud connectivity amongst all of the data centers. On top of this, you've now got training. On top of that, you will have inference traffic, which has only just started to happen. And then you've got the whole adoption of agentic AI, which you think about that from a network point of view, that will increase traffic dramatically. And then on top of that, you've got the robotics piece, the physical AI, if you will. All of that is to come. And I don't think you're going to see any waning moments over the next few years. I think you're going to see a multi-year massive build-out of optical capacity across the globe and within data centers. So every tech...

Analysis

The AI infrastructure sector is experiencing a compounding effect of network investment, with expectations for sustained growth driven by cloud connectivity and increased traffic from AI applications. Despite current market volatility, the CEO of Sienna, Gary Smith, believes there will be no significant waning moments in this cycle, indicating a multi-year build-out of optical capacity is on the horizon.

Smart money should note that while the AI CapEx boom is robust, there are underlying concerns regarding labor market dynamics and credit spreads that could impact investment sentiment. The distinction between winners and losers in the AI infrastructure space will be crucial as investors navigate this evolving landscape.

12:12
PDT

Sienna beat Q3 expectations and raised Q4 revenue outlook.

Sienna Technologies Gary Smith CEO AI

– Shares declined despite strong results, indicating investor caution.

– CEO emphasized the need to differentiate between AI infrastructure winners and losers.

– High expectations may have contributed to the stock's decline.

– Market sentiment is currently broad-brushed regarding AI investments.

AI infrastructuremarket sentiment

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In 2026, the communications equipment company beat street expectations for its third-quarter results and issued a better-than-expected revenue outlook for the fourth quarter despite supply constraints. Joining us live is the CEO and president Gary Smith. Gary, thank you so much for joining us today. I mean, impressive results. It's a beat and raise kind of quarter for you, but shares are down. What do you think investors are missing from these latest asset earnings? I think generally you think about AI infrastructure stocks and I think it's really the discernment between the winners and the losers and really a broad brush being played across all of that AI investment stocks as opposed to who are going to be the long-term winners in driving growth and operating leverage for the business. Yeah, I mean very interesting of course some of the analysts that we spoke to in the back half of your earnings, really pointing to high expectations heading into the event. And in some ways that indicates that perhaps the company is a little bit of a victim of its own success. But, you know, as you mentioned, there is a bit of a rift at the moment in the trade, right? And the AI trade investors looking for winners and losers. What do you think Sienna needs to do moving forward to be part of that winner group? Well, listen, I think Sienna is part of that winning group, you know, in terms of it's a critical enabler of AI infrastructure. And you think about what's happened, you know, from the AI story so far.

Analysis

Sienna Technologies reported better-than-expected third-quarter results and raised its revenue outlook for the fourth quarter, yet its shares declined, indicating investor skepticism. The CEO highlighted the challenge of distinguishing between AI infrastructure winners and losers, suggesting that high expectations may have set the company up for disappointment despite its strong performance.

Smart money should note that the current market sentiment is overly broad-brushed regarding AI investments, which may lead to mispricing of stocks like Sienna that are critical to AI infrastructure. The focus on discerning long-term winners in the AI space could create opportunities for investors willing to dig deeper into fundamentals rather than following the crowd.

12:09
PDT

S&P 500 sees back-to-back gains for the first time since mid-August.

S&P 500 Tesla Bank of Japan Iran U.S.Israel Bloomberg Michael McKee Scarlett Foe Christina Kena Trevor Slavin Baring

– 10-year Treasury yield decreases by one basis point.

– Japanese yen gains 2% amid speculation of potential intervention.

– Tesla shares rise over 6.5% ahead of its Cyber Cab event.

– VIX volatility index drops to 14.5, below the 12-month average.

equity market performancecurrency fluctuationsbond market stabilityvolatility trends

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Eine neue digitale Ordnung ist nicht von Technologie selbst definiert.

Analysis

The S&P 500 is poised for its best day in weeks, up 1.1%, as inflation concerns ease. The bond sell-off is stabilizing with the 10-year yield down to 4.76%, while the Japanese yen strengthens following hawkish signals from the Bank of Japan.

12:07
PDT

Investment-grade issuance from hyperscalers has reached $400 billion since last year.

Federal Reserve hyperscalers AI-centric bonds AI FEDFUNDS

– Most of this issuance is currently underwater due to credit spread widening.

– Market-to-market losses for AI-centric bonds are estimated at $20-22 billion.

– Caution from lenders may increase as corporate supply rises in the coming months.

– Stability in consumer behavior is crucial for future market movements.

credit market dynamicscorporate supply trendsvaluation concerns

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What's the path forward for the Fed at the same time that they're undergoing their own transformation? The one thing I would say, and maybe a point of concern as we get into September and October, is we've seen so much of this investment-grade issuance—about $400 billion in issuance from the hyperscalers—just since the beginning of last year. Almost all of it's underwater today because of credit spread widening and higher treasury yields. So you've got a pretty substantial, almost $20-22 billion of market-to-market losses for those AI-centric bonds over the last year and a half. I think that at some point starts to maybe cause a little bit more caution from lenders around, you know what, I either need a little more clarity around how these business models are going to evolve, or I need a little more margin of safety in terms of my valuation. So I think that could be a bit of a speed bump, if you will, going into September and October, because September is going to be another massive month of corporate supply. All right, we only have about 30 seconds left. You want to be kind of cautious heading into September is what I'm hearing from you. At what point do you want to start playing offense again? Yeah, look, I would say because valuations are tight, because sentiment is great, but because we have these unanswered questions, the supply is kind of pushing investors down the road even faster than they probably want to go of trying to navigate this transformation. I think you'd love to see a little stability in the consumer. Or again, I think so much of it is a valuation story as well of can we get a little bit of a bigger margin of safety on credit spreads, maybe a bit of a margin of safety on P.E. multiple.

Analysis

Investment-grade issuance has surged, particularly from hyperscalers, but much of it is now underwater due to widening credit spreads and rising treasury yields, leading to significant market-to-market losses. This situation may prompt lenders to exercise caution, seeking clearer business models or greater valuation margins as corporate supply ramps up in September and October.

The current tight valuations and bullish sentiment are overshadowed by unanswered questions regarding consumer stability and credit spreads. Smart money should be wary of potential speed bumps in the market as corporate supply increases, which could pressure valuations further.

12:05
PDT

AI CapEx is a key growth driver, but traditional consumption is slowing.

AI labor force budget deficits

– Valuations are tight, with elevated P.E. multiples and bullish sentiment.

– Concerns about a structural decline in the labor force are emerging.

– Wages are starting to fall, indicating potential economic weakness.

– Market may be underestimating risks related to budget deficits.

AI investment trendslabor market dynamicsvaluation risks

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Those other 85% contributors, the household sector, residential investment, have been running pretty darn close to zero for about nine months now. I think there's this sort of building tension between maybe lackluster growth and some of the traditional parts of the economy where consumption's slowing down, wages are slowing down, while this AI CapEx boom has really put the economy on its back, especially over the last year or so. Putting aside the AI CapEx boom, which we know is in no danger of slowing down anytime soon, what will you be paying attention to when it comes to the rest of the economy? Everything we look at is on the fundamentals, the valuations, and the technicals. Valuations across the market are pretty tight, pretty full. Credit spreads at the index level are very, very tight. P.E. multiples are relatively elevated, and sentiment is pretty bullish. The market has a pretty constructive view in terms of valuations. Again, against that, from the phenomenal perspective, yes, the CapEx boom on the AI side is really impressive. But again, I think there's some looming questions around whether we may be facing for the first time ever a structural decline or secular decline in the labor force. We're seeing wages start to fall a bit as well. I think there are some unanswered questions around how AI CapEx ultimately complements or competes with the labor market. What does that mean for budget deficits? To that point, the market has gotten to this moment where I think it's looking through.

Analysis

The economy is experiencing a tension between slowing consumption and a robust AI capital expenditure boom, which has been a significant driver of growth. However, concerns are emerging regarding a potential structural decline in the labor force and its implications for budget deficits and wage dynamics.

Valuations across the market are tight, with elevated P.E. multiples and bullish sentiment, indicating that the market may be overlooking fundamental weaknesses. The interplay between AI investments and labor market dynamics could pose risks that are not yet fully priced in, suggesting a need for cautious positioning.

12:03
PDT

S&P 500 up 1.1%, first back-to-back gains since mid-August.

S&P 500 VIX Trevor Slavin Bearing Federal Reserve US Labor Day So Trevor South Market S&P 500 FEDFUNDS

– VIX at 14.5, below 12-month average of 18.

– Upcoming jobless and inflation reports could impact market stability.

– September is historically the worst month for US stocks.

– Current low volatility may precede significant market movements.

market volatilityeconomic indicatorsSeptember performance

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Rothschild called it overvalued and cut its rating to sell. I appreciate the gainers and decliners, the mix of assorted individual company names there. Yeah, well let's talk about volatility and equities because it's really faded this month. Take a look at this chart. The blue line shows the VIX, the traditional fear gauge, now sitting at 14.5, well below the 12-month average of 18. The white line is the S&P 500's 20-day realized volatility which tracks just how much the S&P has been actually moving day to day over the past month and the line goes up when daily swings are large and it falls when the market settles into one direction or another. And right now if you go to the far right side of the chart it has settled down from its peak of 21% in early April. All of this may just be the quiet before the storm since September, Christina, as you know, is historically the worst performing month for the US stock market. Yeah, absolutely. I mean this volatility chart to me just really screams late summer, doesn't it? It does. The weekend before Labor Day, they are almost the weekend before Labor Day and look at what volatility is doing. But of course, a lot of risk events coming up. Even I mean later this week we have the jobless report tomorrow, right? And of course next week we have inflation data as well that's going to be crucial for what the Federal Reserve does next. All right, so it's a perfect setup. Let's kick things off right now with Trevor Slavin. He has had a multi-asset solutions at Bearing. So Trevor, given all the big catalysts that are coming up for investors over the next week, how much do you read into the fact that the South Market has managed to stay pretty much stable where it's at?

Analysis

The S&P 500 is experiencing a notable uptick, currently up 1.1%, marking its first back-to-back gains since mid-August, while volatility has significantly faded this month. The VIX is now at 14.5, well below its 12-month average, suggesting a period of calm before potential market turbulence as September historically poses risks for equities.

Investors should be cautious as the current stability may be misleading; upcoming jobless and inflation reports could trigger volatility. The market's current low volatility could be a setup for larger swings, especially with September's historical performance in mind, indicating that smart money should prepare for potential shifts in sentiment and positioning ahead of these key economic indicators.

12:01
PDT

S&P 500 up 1.1%, marking first back-to-back gains since mid-August.

S&P 500 Tesla Bank of Japan Iran Israel U.S.Scarlett Foe Christina Kena BOJ Michael Mc New York PRIVATE S&P 500 DXY TSLA CL=F

– 10-year yield down one basis point to 4.76%.

– Japanese yen gains 2% amid speculation of BOJ intervention.

– Tesla shares rise over 6.5% ahead of cyber cab event.

– Oil prices remain unchanged despite geopolitical tensions.

market recoverycurrency interventioninflation concerns

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You the most important news and financial information whenever and wherever it happens. I'm Michael McKee on the Mexican border and this is Bloomberg. The countdown is on. Everything you need to get the edge at the end of the market day. This is the close. The S&P 500 headed for its best day in weeks as inflation concerns cool off. Live from studio two at Bloomberg headquarters in New York, I'm Scarlett Foe. And I'm Christina Kena. We're kicking you off to the closing bell here in the U.S. Let's show you what's going on here with the stock market: the S&P 500 up 1.1%, that's the first back-to-back gains since mid-August. The bond sell-off taking a bit of a breather. You can see the 10-year yield coming down one basis point to 4.76%. Oil prices are modestly higher, branches now unchanged. But we do have Iran and the U.S. resuming their military strikes on one another. Israel also indicating that it is prepared to intensify its role in the ongoing war. And the dollar is weaker today, but the big mover here is the Japanese yen gaining as much as 2% right now. And that is after a BOJ senior official board member struck a hawkish tone and traders speculate on whether there's going to be intervention in the coming hours or days. Christine, alright Scarlett, let's take a look at some of today's equity movers starting with Tesla. Those shares are up more than six and a half percent, that is of course before its cyber cab event in Austin. Apparently they're going to reintroduce.

Analysis

The S&P 500 is poised for its best day in weeks, up 1.1%, as inflation concerns ease. The Japanese yen is gaining strength, rising as much as 2% following hawkish comments from a Bank of Japan official, suggesting potential intervention may be on the horizon.

Smart money should note the back-to-back gains in the S&P 500, indicating a potential shift in market sentiment after a prolonged period of volatility. Additionally, the yen's movement could signal a broader trend in currency markets, particularly if the BOJ takes action to stabilize the currency.

11:58
PDT

S&P 500 and Dow up over 1%.

Snowflake Tyson Foods S&P 500 Dow Matthew Griffin Bloomberg US VP OK Alec Osteca Picardie Global Molly Smith PRIVATE AAPL CL=F

– Snowflake shares up 84%.

– Tyson Foods stock down 12% this year.

– Beef supply shortage impacting Tyson's outlook.

– Tech sector showing recovery while consumer staples struggle.

tech sector recoverysupply chain issuesconsumer staples pressure

▸ Full transcript

I'm Matthew Griffin. He's our US equities reporter here at Bloomberg. Thank you so much for running us through all those. Yeah, for more information, conversations like this, you can listen to our new stock movers podcast. Subscribe for five-minute episodes of the biggest winners and losers in the stock market. Listen to stock movers on Apple, Spotify, anywhere you get your podcast. Lisa, I believe the court is calling us, our colleagues who are over Tim and Molly. Can you hear us? Are you having a blast out there? As anyone? Oh, we can hear you. Yeah, we can hear you guys. Hey, thanks for keeping the seats warm over there for us. We appreciate it. Yeah, no problem. It's fine. We'll be in this freezing air-conditioned studio while you're out in the sun having a good time. What do you got coming up in the next couple of hours? We have, well, we're staying cool because we got a couple honey deuces. The reason we actually have honey deuces with us right now is because Alec Osteca is going to be joining us in just a minute. He's the Greg who's at Picardie Global VP of marketing. You know they sell more than 700,000 of these a year. I'm taking the over on that. Yeah, you think so? This year? OK. Oh yeah, easy. Yeah, we're also going to be talking quite a bit of tennis. I mean, we have our in-house tennis expert, Molly Smith here. Yeah, she does legal news at Bloomberg, but her real passion is tennis. So we got a great program coming up, guys, and we hope you tune in. I'm boycotting it just out of jealousy, but it does look amazing. And I'm hoping that you will get one of those honey deuces for me. Maybe you can like put a little tinfoil over it like my mom used to, and you can bring it back to the studio and put it on my desk for me. They're not cheap. They're like 23 bucks. I will at least bring you a souvenir.

Analysis

The S&P 500 and Dow are both up over one percent, with notable movements in individual stocks like Snowflake, which has surged approximately 84%. Meanwhile, Tyson Foods is facing significant challenges due to a shortage in beef supply, leading to a 12% decline in its stock this year.

Investors should note the contrasting fortunes of tech and consumer staples, as Snowflake's strong performance reflects a rebound in tech sentiment, while Tyson's struggles highlight ongoing supply chain issues in the meat industry. This divergence suggests a potential shift in sector allocations, with tech gaining favor as consumer staples face headwinds from rising costs and supply constraints.

11:56
PDT

Snowflake's stock is up 84%, indicating strong market confidence.

Snowflake Tyson Foods T S AI cybersecurity software sector ETF Shares Software T S

– Tyson Foods is down 12% this year due to beef supply shortages.

– Margin compression is affecting meat packers as cattle availability decreases.

– The software sector is recovering, particularly for AI-related companies.

– Consumer prices for meat may rise as companies face higher costs.

supply chain riskAI adoptionconsumer price inflation

▸ Full transcript

The company has seen a remarkable change in the conversation about its sector. A few months ago, discussions centered around AI disruption, and the sector was down as a group. Recently, the cyber names rallied, and now Salesforce is performing well. The iShares Software ETF, which does not include this name, shows many other big software names in the green year-to-date. Snowflake has maintained its position, with many CEOs reporting that their companies use it. Moving on to Tyson, a consumer company is taking a hit from the shortage of beef in the U.S. There is significant pressure on any company in the beef supply chain. The meat packer, ticker T S, is selling off after cutting its outlook for the fiscal year. This reflects the ongoing impact of a shrinking cattle herd, which is weighing on them. They mentioned significant margin compression due to the shortage; with fewer cattle, it becomes more expensive to buy meat, but they do not always want to pass all of that cost onto consumers. Consequently, the stock is now down 7.5% today and 12% year-to-date.

Analysis

Snowflake's shares are up approximately 84%, reflecting a significant positive shift in market sentiment towards the software sector, particularly in AI and cybersecurity. Conversely, Tyson Foods is facing challenges due to a shortage in beef supply, leading to a 12% decline in its stock this year as margin pressures mount from rising meat costs.

The shift in sentiment towards Snowflake indicates a broader recovery in the software sector, suggesting that companies leveraging AI are gaining traction. Meanwhile, Tyson's struggles highlight the ongoing vulnerabilities in the beef supply chain, which could lead to further price increases for consumers and impact related stocks in the meat industry.

11:54
PDT

S&P 500 and Dow both up over 1%.

Snowflake S&P 500 Dow Nasdaq Matthew Griffith Bloomberg SNOW Bloomberg Surveillance Lisa Abramoids Bloomberg Business Week Daily Carol Masser Tim Steneveck PRIVATE SNOW

– Nasdaq also showing positive movement.

– Snowflake's shares up 84%.

– Falling yields suggest a shift in investor sentiment.

– Market is reacting positively to tech sector performance.

equity market performancetech sector growth

▸ Full transcript

Markets are the best way to glean signal from noise, and that is what we try to do every morning. This is Bloomberg Surveillance. Bringing you up to the minute news whenever and wherever it happens. I'm Lisa Abramoids in Rio de Janeiro, and this is Bloomberg. This is Bloomberg Business Week Daily with Carol Masser and Tim Steneveck on Bloomberg Radio and Television. Welcome back to Bloomberg Business Week Daily. The U.S. and P. 500 is up more than one percent, the same for the Dow and the Nasdaq. Yields are falling a bit. What we want to do is check some of those stocks that are moving today, so let's take a look at some of the stocks on the move. At least material, Christina Rufini, we're joined by Bloomberg News U.S. equity reporter Matthew Griffith, and we're going to be joining them in just a bit. First, we want to take a look at the markets really quickly. I'm seeing green across the screen, the S. and P. 500 is up more than one percent, the same for the Dow and the Nasdaq. Yields are falling a bit. What we want to do is Griffin, Matthew, thanks for joining us here in studio. So let's start with Snowflake, Ticker SNOW. Their shares are, wow, up about, and I'm 84% right now. I feel like this is a company I always talk about when I film it on this show. Yeah, so what is going on with this company? I now know everything about only from subbing in on Tim McCall's show. Well, thank you for having me, Snowflake. That's Ticker SNOW. That boost is coming.

Analysis

The S&P 500 and Dow are both up more than one percent, with the Nasdaq also showing gains, while yields are falling. Notably, Snowflake's shares (Ticker: SNOW) have surged approximately 84%, indicating strong market interest and performance.

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