Nasdaq Hits Record After Soft Jobs Report… And The Fed’s Next Move After Jobs Report 10/2/26

22:47What does this do to Europe's stockpiles when they do release? How much of a draw is it? Yeah, so it's a substantial one and it depletes it. And what we've seen is that they have been reluctant to do that. And so one of the other questions here is that the 400 million barrel release that was announced back in March, it's unclear to what extent this is just part of that because we didn't actually get updated figures. We heard a lot of finger pointing from U.S. administration officials saying that France and Germany, other nations, Spain, didn't follow through on their on what they said they would release.

23:17And so that's another key detail that has to be ironed out. We did. I did reach out to the IEA asking for more clarity and so far have not heard back. First of all, incredible to have Pippa here on a Friday. I mean, we're lucky. I don't know why we got so lucky. Now, we're supposed to be the traders and whatnot, but but to the extent that if you look at whether it's energy infrastructure or some of the things that are very much the tailwind behind it, everything you just said of what's going on. A lot of these names are actually down and or flat to down. And so I'm just wondering if there's something either structural or is it the classic there's unsustainability in these types of disruptions and that the market really doesn't know what to do with them.

23:54But if I look at MLPs, if I look at pipeline companies who seemingly also those that are stretched into NatGas and are a big part of some of these, I would just say, tailwinds that also are around data center and whatnot, they're down. XLE is down and basically flat to pre-war. Any thoughts on that? Yeah, I think that we've seen really specific concentrated movement. And so, of course, the refiners are the ones that stand out because those stocks have more than doubled year to date. But I think we also look at the recount, and that's on the rise. But when you look at who actually is behind that, it's primarily the private players, because the public guys and the majors have said, we hear from our shareholders that they want capital discipline.

24:32They don't want us to change our production plans based on swings in the crude market, particularly when you look at the forward curve. Yes, it has come up, but we're still talking about, you know, 75 at the end of next year. So that's not, you know, a huge, meaningful uptick that would that would cause them to change their operations. And then I think on the gas side, I mean, the the setup going into this year was completely different because it was all about, you know, who has exposure to LNG, who has exposure to gas. That's what that's what's going to fuel the data center build out. But some questions emerge about that.

25:00And then, you know, also the weather has worked out in favor for consumers, not so much for gas producers. That's kept a lid on that. So we've seen kind of rotation into the refiners. But it seems like the majority of people are saying, you know, this is not going to lead to any type of changing plans. Thank you. Great to see you. Thanks for having me. There's a lot more Fast Money to come. Here's what's coming up next. Delivering the charge as Tesla stock jumps after a better-than-expected EV delivery report. The good news has our traders plugging in, plus stocks and rates on the move as investors digest a soft jobs report.

25:36Why our next guest says the Fed may still raise rates a full percentage point by the spring. You're watching Fast Money, live from the NASDAQ market site in Times Square. We're back right after this.

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26:21With the Discover Cashback Card, it's payback time when you earn cash back on everyday purchases. Activate and earn 5 % cash back at different categories each quarter on up to$1 ,500 in purchases. That's 5 % cash back at different places each quarter, like grocery stores, on gas, and at restaurants. It pays to discover. Terms apply. See discover.com slash five for details. AI is here, transforming how we work, live, and lead. And the women I talk to aren't waiting for the future, they're shaping it. I'm Julia Boorstin, Senior Media and Tech Correspondent at CNBC. This is CNBC Changemakers, where I talk with the female leaders transforming business as AI reshapes the world.

27:08Follow and listen to CNBC Changemakers, women leading in the age of AI, wherever you get your podcasts.

27:20Welcome back to Fast Money. Tesla shares driving 4.6 % higher on better than expected vehicle deliveries for Q3. Deliveries hitting 486 ,000. That's down 2 % from a year ago, but up versus last quarter. Analysts were looking for 462 ,000. Tesla set to report earnings later this month. Shares are down 17 percent this year. The only Mag 7 stock in the red. Santoli was making the point in the last hour that maybe it got swept up in some of the sort of risk on stocks, like in the semi trade, as well as SpaceX. You're pointing out SpaceX today, for instance. I think there's correlation and there was a lot of movement in the space.

27:54Satellogic, you know, a bunch of these names were up big. I still think people are looking at some of the dynamics between SpaceX and Tesla. I also kind of don't feel like Tesla is a Mag 7. I really don't feel like it trades in the same dynamic. You should have never been in there. That Mag 7 was named because these were companies that were moving together and of a size. But anyway. I agree. I mean, to me, Tesla is like a tracking stock for SpaceX at this point. You don't know when, but you do know eventually. And so I think those are the more important things. So do you own one? Do you have exposure to the other?

28:29You could. I would guess I would do Tesla. because then you'll have, if there is a deal, you'll have some premium. Right. And then you will have SpaceX. Except for Elon does deals that are accretive to SpaceX, right? I mean, well, so it seems. But he's a huge Tesla holder. He is. Huge. He is. I don't know. There's a new dynamic there. Do we have enough data to chart SpaceX at this point or no? Yeah.

28:53Guy Adami:I mean, look, you have this immediate excitement. You have the collapse. And then ever since, it's been sort of trying to find its footing, basing, bottoming. I'd rather have, as a chart, SpaceX here than Tesla. So, would you rather? I'd like to know we did that. Yeah, yeah. Okay. Para-force. Coming up, another 100 basis points. That's how much our next guest says the Fed still needs to hike rates. Former Trump Treasury official Joe Lavorna joins us next to lay out his case. Don't go anywhere. Fast Money is back in two.

29:27Welcome back to Fast Money. Stocks rounding out the week with gains after this morning's soft jobs report. NASDAQ and NASDAQ 100 both hitting fresh record highs and ending the day up more than a percent. The Dow climbing 250 points, S &P 500 up three quarters of a percent. All that after the Bureau of Labor Statistics said nonfarm payrolls rose by 29 ,000 in September, well below the 84 ,000 forecasted. Treasury yields initially dropped on the news on hopes slower economic growth would keep the Fed from hiking rates again later this month. But the pullback didn't last long and rates ended the day higher across the board.

29:59For more, we are joined by former Trump economist Joe Livornia, now chief economist at SMBC Americas. He recently served as economic counselor for Treasury Secretary Scott Besant. Joe, great to have you with us. You're saying 100 basis points more in hikes, which is really, I mean, we introduced you, your ties to the administration. Contradictory to what the administration is calling for. What are you seeing? What do you think they are getting wrong? Well, I made the call, Melissa, back in May when it was not consensus. And it was funny. I was seeing my old boss, Scott Bessent, who was very funny and charming.

30:37And he said, oh, look, Mr. Interest Rate Hike. So he kind of chuckled at it. But the argument that I made was, look, the economy is booming. The market is responding very positively. The economy that is in the market is very positively to President Trump's economic policies of supply-side improvement. It's just that you're not going to get much disinflation in the short term, but rather you're going to get a boom. Maybe it'd be more of an inflationary boom, at least initially, but it's going to be a boom. And therefore, the Fed needed to reverse the three interest rate cuts from last year. The last one was very contentious.

31:11And of course, Melissa then adjusts for the fact that our star, the equilibrium interest rate, probably is higher than what the Fed had thought. because outside of housing, which is 3 % of the economy, the other 97 % is doing really well. So it's an interesting, you know, you can definitely spin it that way. Like, you know, the economy is so good. That's why rates are higher, and that's why we need an interest rate hike. And that's not the tax the administration is taking. I'm curious, Joe, because there is an argument to be made that if the Fed does hike rates, It's only going to dampen the things, the areas that, you know, that are not driving the primary drivers of this rise.

31:55And that is the AI CapEx boom, that that portion of the economy is going to be much more immune to rising rates. And so the inflation from that sector, which has been a key driver, will not abate. Well, here's the thing. Yeah, I would definitely must push back a silly not spin. I mean, the economy is doing very well. We're going to have two quarters in a row with nominal growth well over 6 % in a year on year basis. Yes, the AI is perhaps somewhat interest rate insensitive. The consumer clearly isn't. But the thing is, when you look at the supply shocks from the Middle East, you could say, look, let's say tomorrow everything was settled and inflation moved lower.

32:34We've got very strong growth. And even if inflation were to surprise to the downside, it would be prudent. and Kevin Warsh, I think, is very forward-looking. He'll be prudent to calibrate policy to where you think the economy is likely to be a year or two from now, which is how we learned to understand Druckenmiller, same with Secretary Besson. And when you're growing at this pace and the Fed is the one, the agency responsible for inflation because they effectively control the price of money and credit, you just can't sit and wait and allow inflation, which has been above target for nearly six years, to say, well, eventually it's going to come down and we can't do anything because the AI boom is a boom that isn't related to interest rates.

33:13That's not a very productive course of action. So, Mr. Interest Rate Hike, I wanted to ask you, I'm just being cute here, Joe, because I think you have been consistent. And one of the things that I remember you also talking to us about in periods around tariffs were that they weren't inflationary. And so what I keep seeing when I go through the ISM numbers and I look at regional Fed surveys and you listen to companies, The disruption that's going on and at least the forestalling of purchases and the inflationary impact, especially in shipping costs and some of the disruptions that are coming from the tariffs on top of then supply disruption, obviously what's trickling down from the war in the Middle East does seem to be having an inflationary impact.

33:57So I know you've just framed your whole view on inflation and where you're actually you could even be cautious in the short term, even if you think they go at least once. But is there is the point that a lot of this will dissipate once, we work through some of these supply disruptions? And I don't know if tariffs as a policy will change. But yeah, I don't believe tariffs. Yeah. Yeah. Thanks, Tim. Tariffs, I don't think as a policy will change. Biden, President Biden kept everything that President Trump had in place. And I'm sure he was ever in office, a Democrat, Republican will keep a lot of those policies in place.

34:28The tariffs certainly have added to confusion for some people. They have had some price level effect that's been minimal. But the key thing is when you look at inflation, And this has sort of been in the Fed's wheelhouse. When you look at core services, which are half of the PCE and half of the CPI, those prices have consistently been running above 3 percent. That's totally immune from AI. It's totally immune from what's happening with tariffs in the Middle East and the supply disruptions, which in the short term could add an inflationary impulse, no question. But the fact is, as Chair Warsh said, and he's very serious about this, the Fed needs to get inflation back to target because elevated inflation is a huge tax on middle and lower class Americans.

35:10And the only entity that's responsible for that price level is the Fed. So we've got some distortion in the short term. I think that's why, Tim, the Fed skips. They're not going in October. They'll go again in December. They'll go again January, probably March, perhaps even in April. And then we see how things play out. Maybe, God willing, there'll be some resolution in the Middle East, and we'll see some of that commodity pressure and oil prices move lower. But in the meantime, with the demand of where it is and the supply build-out adding to input costs, it's hard to think the Fed can just sit and do nothing.

35:42Joe, great to speak to you. Thank you. Thank you, everybody. Have a great weekend. Joe LaVornia. 100 basis points, really. I mean, in the context of there were three cuts before. If you take those out, it's only plus 25, given the strength of the economy that we have today versus where it was before. I would really wonder, okay, let's say he does that. Where would the 10-year be? Where would the 30-year be, right? If we do nothing, it would seem like it would be higher. If we do something aggressively, would it be lower? Right. Maybe. Where would inflation be then? I mean, you have all those other issues.

36:19Where will oil prices be? Yeah. That you can't know. Right. Meantime, it is an end of an era here at CNBC Today, as we say goodbye for now. To our own Rick Santelli, he's been a fixture at the network and part of our family for nearly three decades. He's on the pantheon of CNBC talent. Here's a look back at his one-of-a-kind career. Hey, short time. These guys are working your bit.

36:44Guy Adami:Rick Santelli's all fired up at the CDOT. Hey, Rick, it's going to be a bumpy ride. Viewers, be careful out there. How many of you people want to pay for your neighbor's mortgage that has an extra bathroom and can't pay their bills? Raise their hand. President Obama, are you listening? How can somebody go to Congress for days before a recession and ask for my sweatshirt? Stop spending. Stop spending. Stop spending. Stop spending. Stop spending. Would you rather have this slice or this slice? Smash, smash, smash some deficits. It's good. It's good. Rick's in, tell me. How you doing? Bring it, Ricky.

37:22Guy Adami:It's our turn.

37:26Yeah! Here we go! I'm the sergeant at arms of this joint. Once again, a stellar auction. Fabulous. A plus. A plus. A plus. C plus. Charlie plus. Z minus is the grade. D. D. D is in dog. That's a big collie tail there. Not good. You see this? This is a mop. That's a bunch of hooey. Auctions are like buffet tables. The buffet indicator. Buffet, buffet, buffet table. Hardly had anything left at the buffet table to take.

37:56Guy Adami:Everything in my life goes back to the markets and CNBC. Back to you, big guy.

38:04Welcome back to Fast Money. Biotech has outperformed the market this year with gains nearly double that of the S &P. One reason could be the group's relative insensitivity to rising rates. Joining us here on set, Mizuho Healthcare Specialist, Jared Holtz. Jared, great to see you. Thank you. Conventional wisdom is that biotechs are sensitive to interest rates, but you say it's not true. You have a chart, actually. Yeah. When you look at the index, when you look at the IVB or the XBI for the past 20 years, the only time period in which you really saw some sort of pronounced correlation was during the pandemic.

38:40Right. Rates were close to zero at the time. And then the sector performed the best it's ever had because of vaccines and a whole other dialogue around drug stocks in the context of a market that was plummeting for obvious reasons. And so if you take that time period out of the equation and you look at pretty much any other duration of time between 2005 and now, there's very little. Now, obviously, I think the street is very pegged to this narrative and that rates are the doomsday for biotech. But you really don't see that in the data itself. And then there's also sort of the other theme, the other narrative that the big cap pharma companies have to do some deals.

39:19And so there's a lot of interest. You're seeing inbound interest in particular names thought to be takeout candidates. Yeah, I mean, we've had a table for several years and have captured a good amount of these. We know that pharma has to act. I mean, it's either you see revenue degradation or you have to reinvigorate your pipeline. So there has been a lot of activity this year. We're bound to get more. I think my table has about 25 or 30 names in it. It sort of vacillates depending on what I think is, you know, more susceptible, where the buy side commentary is sort of like pegged to. Insomet is the largest name in that group.

39:58And it sort of cascades from there in terms of revenue. But I think, you know, most of the sector is susceptible. We know there are huge buyers out there. Amgen, Sanofi, Lilly, J &J, Merck. I think they'll all continue to be acquisitive. Let's talk about one that's been a terrible one for me this year, Novo. Yeah. As a crior or just as how they're running their business, what would you what would you have them do? Yeah. So they've been pretty forthcoming about wanting to do more deals. I mean, they had an analyst day last month where they talked about it. They've been pretty adamant all year, but they haven't really been too active.

40:33They did a caro a little bit over a year ago in the Nash space. We could see them do something in obesity. Obviously, the street is sort of like walked away from the pipeline here. Like there's really no embedded value in anything other than Wegovi and Oral Wegovi for this company. They could go in the direction of a different modality in obesity. They could go cardiovascular. It really depends on what they want to do. But I think almost any deal, to your point, Karen, the stock has been horrible. I think anything that they do, the stock will will re-rate a little bit. Speaking of not abandoning, you have not abandoned your Browns.

41:09And nice to see your faith rewarded with a three in one record. So when I think of the biotech world and just think about the IBB versus the XBI, I mean, there's an argument that Regeneron and Vertex, that these aren't really biotech companies on some level, because at least the implication for me is at least that these are these are mature pharmaceutical companies that are investing in different spaces. And, yes, on the leading edge. If you had to pick, this is a different way of asking Karen's question, though, but more generically, would you be investing in the acquirers or the acquiries here?

41:42And if you can make the assumption that XBI is a smaller, more, you know, smaller, smaller cap play, and that's the acquirer, which would you rather own? I'd probably say XBI, smaller, smaller cap. The one caveat would be that when you look at the XBI membership today, the constituents, it's really changed. Moderna is one of the largest companies in that index now. You've got a bunch of diagnostics and some large cap biotechs have crept in there. So it's tough to know on an index by index level. But in general, I would go more towards the smaller and mid cap, knowing that, again, the space has been pressured a bit on the interest rate trade and some nervousness around there.

42:29So you do have a bit of a pullback to play into 2027. Jared, good to see you, as always. Thank you. Carter, how do these charts look?

42:38Guy Adami:Well, let's talk about XBI. I mean, XBI peaked in 2021 in February, and we are almost back there. I mean, that's what ultimately new highs are about. When you draw down a lot and then recover over time and return to the point where you ran into trouble and then ultimately after backing, failing, break out. I think XBI is a large long here. Are you getting sadder and sadder about Novo? I mean, at what point would you think? We're slowly getting sad. You know, it's less. There's far more upside than downside. Now, I'm not inclined to sell it here, which has been the wrong thing to do for a long time.

43:14But stick by it. Stick by it. Coming up. Yeah. We'll have to change the day. Coming up, harvesting some technicals at key levels to watch in ag giant Archer Daniels Midland and where the chart masters use this stock heading next. More Fast Money in two.

43:38Welcome back to Fast Money. agriculture stocks up this year. Supply disruptions have increased prices for wheat and grains. And chartmaster Carter Wirth says there's at least one name in the group ready to reap even more rewards. Carter, what would that be?

43:52Guy Adami:Okay, let's get to it. So what do we have here? This is an aggregate of grains, right, as seen here. And you can see the weighting. It's got corn at 47, wheat at 35, soybeans. Okay. And obviously, it has all the elements of a bearish to bullish reversal. You see the nice arrow I've got there. All right, so let's go to ADM, a big player, longstanding American, great company. Now, since the bottom, and it's been a great bottom, right? Draw the lines this way, all that beautiful stuff. It has had nice consecutive drawdowns. Let's look at those drawdowns. I have a very sort of detailed, so A, B, C, D, E, and F, look at them.

44:39Guy Adami:They're almost all the same. 14, 10, 11, 16. This is the median mean, 13, and look, 10 sessions, 14, 11, all averaging about a little more than two weeks. So remember that. Let's look at the chart, next chart. We're simply in the most current one. This is a nice uptrend. There's no question about it. And we've had these beautiful dips, corrections, drawdown, sell off, decline, whatever nomenclature one prefers. Final chart. This current, which is just like all the others, leaves us to the penny at the 150 moving average. I'm a buyer for more. On the funny mental side, you know, you can think about things like fertilizer costs and diesel costs that have really sort of pressured this sector.

45:29or maybe those we've seen peak pressure at this point? Well, I think you can make an argument that there's been a lot of nevertheless priced into these stocks. I'm historically an investor in the ag space. I think the cycle in Deere is the more interesting part of this. And I think the ag cycle as a function of those is now playing into Deere, that outperformance. It's not as Deere has underperformed, but really you've had a lot of, I would just say, volatility in the earnings profile. I think this is a great time to own it. All right. Up next, final trades.

46:02Final trade time, Timote. That chart, NVIDIA, is not the reason. It's the funny mentals. NVIDIA, cheap. Karen. Yes, so heading into earnings next week. Billy starts it off, but I like Google for the end of the month. And happy birthday tomorrow to my husband, Lawrence. Huge pain in the ass, but I do love it. Whoa. That's a big caveat.

46:24Guy Adami:Carter Brackson-Worth. Well, Arger Danos, just from a trading perspective, play for a bounce. John Deere, too. Happy birthday, Lawrence. Thank you for watching Fast Money, Mad Money with Jim Kramer starts right now.

46:58a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Fast Money participants consider reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Fast Money Disclaimer, please visit cnbc.com forward slash Fast Money Disclaimer. CNBC Changemakers, spotlighting women who innovate, lead boldly, and are transforming business. Do you know someone who is rewriting the future? Nominations for the 2027 list are open now at changemakersnominations.cnbc.com.