Next Market Catalyst… And Rounding Up Retail Results 8/28/25

0:01Live from the NASDAQ market site right here in the heart of New York City's Times Square. This is Fast Money. Here's what's ahead tonight on the big show. NVIDIA earnings, they're in the books. Jackson Hole, it's in the rearview mirror. So what will be moving your money and the markets in the months ahead? We'll discuss and debate. Plus, retail reporting, gap numbers just crossing the wires. Investors digesting details from Best Buy, Dix, Dollar General and more. We're going to round out the retail trade. The latest from the Fed drama, Lisa Cook hearing. tomorrow morning, what we're expecting, and why Wall Street is suddenly seeing green on a big gambling name.

0:41Plus, EB competition in Europe is getting legit. We're going to talk about that and much more. Hello, everybody. I am Brian Sullivan. In for Melissa Lee once again, coming to you live from the NASDAQ Studio B. And on your desk tonight, we've got Steven Grasso, Daniel Nathan, and Guy Tano. Is it Guy Tano? What's the full name? Well, since you asked, my father was Gaetano Marino, but I was born in 1963, as you know, and parents didn't want to name their children ethnic names. So I'm just Guy Christopher. Listen, you brought it up. I mean, you asked it quick. What am I going to say when you ask me a question?

1:18Just say Guy. And it's a miracle that Guy Adami is not ethnic, which I love. But we start with an all time high for the S &P 500 as markets keep going up. The index crossing 6 ,500 for the first time ever. The move's all coming as NVIDIA did not scare investors off with its earnings and guidance. The AI trade, in other words, keeps going. Yes, NVIDIA did fall a tiny little bit today. But CEO Jensen Wong making bullish comments about the future of its business in China. So with the most important report of earnings season out of the way, Jerome Powell making people believe that a rate cut is just around the corner.

1:58Guy. Yes, sir. Adami, what is the next big catalyst for the stock market? Well, as Steve will tell you, you never short a dull market. And this is what we are. He'll also tell you that in the quarter end, the way the trajectory has been suggests we're going to continue to go that way. And obviously, tomorrow being Friday, into a long weekend, that's what we're looking at. So it's hard to derail the momentum. But with all that said, you just mentioned all the catalysts in the room. They're catalysts looking us straight in the eye, coming in the form of inflation data, job data, things that can move the needle.

2:29And oh, by the way, global interest rates continue to go higher, which I don't think is bullish. So I understand it. I get it why the market's going higher. People are very optimistic about things. But the things that I've been concerned about have not gone away. Yeah, you know, it's interesting when you look at the fateful eight. So that's the MAG7, Sully Plus, Broadcom. You know, the disproportionate amount of their sales comes from outside the U.S. So you think about the fact that dollar is making new multi-week lows here. It's very, you know, it's off of 110. This is the Dixie trading below 98 right now.

2:58and they don't have a whole heck of a lot of exposure from the tariff situation, right? So if you think about these large names, let's call them the top 10 in the S &P 500, they're benefiting from a weak dollar, rates going lower, and not having a lot of tariff impact. So if they're huge contributors to the performance of the S &P 500, but also from the earnings and the earnings growth, that could be a bit of the tailwind and one of the things that's kind of keeping the S &P kind of moving slightly higher almost every day. So, Steve Grasso, what do you think, in your mind, your big brain, will be the next catalyst for this market?

3:29The Fed Reserve meeting, right? Just a little thing. And to Guy's point, you never short a dull market. You never sell a dull market. But when you look at seasonality, these are the weakest months of the year. September, historically. August through October is the week. But not cataclysmic weakness. It's just maybe you don't want to invest around that time. Maybe you want to pick up some bargains. For me, I think it's all about the Fed. Are they going to cut 25 or are they going to cut 50? I think that's the biggest thing. Now, love them or hate them, President Trump is going to give us something in the next couple of months.

4:10So they're not going to be dumb. There's going to be a headline. There's going to be another state. We get a headline every day. Exactly. So we really can't be a boring market anymore. And you have Lisa Cook. You have the Fed Reserve meeting. a lot to keep us all busy. Yeah, and I do. It's not a normal news cycle. So I do wonder, we got breaking news in a second. I do wonder, Guy Adami, going into a long holiday weekend, he used to be just take it off, relax. I don't know with this president. We're getting headlines out of the White House every day. He doesn't care it's a Friday going into a three-day weekend.

4:42No, he doesn't. And it's interesting. I'm glad you said that because he has now equity in the equity market. What does that mean? With an S &P 500 at an all-time high, he has some chips that he can play with. So if he wants to lower the boom on a holiday weekend in terms of tariffs or anything else, now's the time to do it, given where the S &P 500 is, because he's trading from strength, not from weakness. And historically, if you go back and look, when the market's at its highs, it's typically when he can ratchet up the rhetoric. So I wouldn't be surprised to see something over the weekend. All right.

5:14I do have some breaking news. Got a news alert right now. Reports of a new CDC director. Angelica Peebles with that. Angelica. Hey, Brian, the Washington Post is reporting that the White House has selected Deputy HHS Secretary Jim O 'Neill as acting director of the CDC. Now, we have reached out to HHS and we'll let you know if we can confirm that news right now. This is according to the Washington Post. We're citing people familiar with the situation. Remember, just yesterday we heard the reports that the White House was removing CDC Director Susan Minares from her position. It was still a little bit of a tricky situation where her lawyers are saying that she has not actually been legally removed from that job.

5:54The White House is saying that she is indeed out. And apparently they have named her replacement. So much more to come on that story. And we'll keep you posted with anything else we can share. So just to be Angelica, just to be clear. So we have a purported firing of Susan Menares yesterday. She says, no, no, I'm still in the job. But now the White House has reportedly named a new. So theoretically, right now, there are two heads of the CDC. or two people who are considered heads of the CDC? Theoretically, that is what's happening. But again, the White House is saying that she is out and they have a new person in.

6:27Well, that's what The Washington Post is reporting. They have not confirmed that they do have a new head. But theoretically, there are two. But again, it's a little bit like the Lisa Cook situation, where you have someone saying, you know, I was fired. You know, the White House is saying that we're firing someone. That person is saying, you can't fire me. So it's a little bit of a tricky situation. but last we heard her lawyers are saying that she indeed has not been fired, but the White House is saying that they did go ahead and take that step. Wow. Getting real out there. Complicated. Yeah, it's complicated, but it's also not.

6:59Somebody says, I'm not fired. Angelica, thank you very much. The president says, here's the new head of the CDC. Susan Minaris says, and this is, by the way, this is going to happen at the Fed. You know this is going to happen with the Lisa Cook situation. That's what Steve was talking about. I think it is important. And again, listen, I'm not here to arbitrate guilt or innocence. I mean, that will hopefully be adjudicated in a court of law. But I will talk about is the impact I think it should be having to our bond market, because the entire structure is built on confidence. And if you start to have any concern about the independence of a Federal Reserve, I'm not suggesting people won't buy our bonds anymore, but they can demand a higher rate of interest to do so.

7:41We're not seeing it at all. I want to be crystal clear. You mentioned it last night. The bond market doesn't seem to care. It should start caring, in my opinion. And that would be a sell-off of U.S. debt? I think that's a sell-off in the bond market. I think that's interest rates going higher. I'm not suggesting it's what we saw in early April when the bond market was melting down on one random Tuesday night. I don't think we're going to get to that point, but you get something close to that for sure. And to Guy's point, if you look up on the screen right now, we've seen no effect of it. The market is not paying attention to it.

8:11The equity market is at all-time highs. The Treasury market, the yields are not rallying. So the market seems to be treating it as if it's a non-event. I get Guy's point. One day it won't be a non-event, but right now it's a non-event for the marketplace. Okay, so let's go back to what is an event for the marketplace. And by the way, we'll get more on this Lisa Cook situation in moments. But for more now on the record highs and the AI boom, let's bring in Joe Cusick. He is portfolio specialist at Calamos Investments. Coming to us from one of my favorite places, the SIBO. Tell everybody there, Joe, that we said hello.

8:47Love that place as well. Very quickly, I'm not going to ask you to dive into the politics of it, but are you surprised that all this brouhaha around the Fed is not impacting bonds in the markets? A little bit surprised, but no, because you've seen that we've had mispricing and volatility as far as the implied and what's actually realized. So, you know, as an old options trader, this is basically what we expected. The market doesn't care, and it hasn't. And it's steady as we go, and that mispricing has been in place for a while. And the VIX, the so-called fear gauge volatility index, which really just sort of measures options pricing and spreads, that's not indicating any nervousness at all.

9:31But when the VIX is this low for this long, Joe, I guess I've got the old the old options trader sort of semi in me as well, because that makes me nervous. Well, yeah, I mean, look, I saw some of my old buddies that I used to trade with down here. Look, the spidey senses are up. This the level of complacency. I've been talking about it, you know, as a hedged equity strategist. You know, the bottom line is, is that we do we are concerned because navigating this complacency without any guardrails to the downside. it absolutely scares me. And institutions have to stay in this market. And retail, well, they're starting to feel like they might have to chase a little bit.

10:09So right now, that complacency in the VIX is something that over time I have found throughout my career is a little bit of a yellow flag at this point in time. Yeah, I agree with you, Joe. And I think the market participants have realized that the sell-offs don't last that long. Just go back to April, It lasted maybe three or four days. And I think the game now is that, you know what, we're going to continue to sort of full speed ahead, as you just said, because we'll be adept enough and quick enough to exit if, in fact, an event comes. And I think that's where the market is at this point. Of course, you know, having done this for a long time, markets go down a lot faster than they go up.

10:46And we saw glimpses of it in April. We haven't seen anything since. Anything on the horizon? Steve mentioned seasonality into September. Yeah, you know what? But it's look, I see some yellow flags coming up in the energy sector. I still see that the institutions are buying puts in mass. The skew has really come up. And we've actually seen recently that put spread activity is really kicking up. So coming into September, while we've seen that the trajectory is still to the upside, we're at all time highs. You can't debate that. You're starting to see positioning that's continued with institutions hedging in mass and buying calls in lieu of buying underlying.

11:25And you're seeing retail now coming in and doing put spreads in things like the S &P 500, using hedged equity strategies and so forth, because there is a lot of uncertainty that's starting to grow, even though it's not reflected in volatility. So, Joe, in your career and in my career, we've watched institutions run the market. Now we've seen retail lead in the market. How do you address what you look at? What are your signals now that retail investors are actually moving the ball, not institutions? Well, first of all, you're going to see that you're going to see a lot more speculative moves. In other words, you're going to see option volumes through the retail shops start to increase notably.

12:08And we're starting to see that. It's starting with spreads. And, you know, we're going to continue to watch that. The other thing is, too, is that you're basically going to start to see that the transition into looking at the unloved stocks, the ones where it goes beyond means, but it's going into spaces that haven't had a lot of love and seeing that that's where the retail is going to show up. I think that the institutional side is fully vested at this point in time. We've seen that. We continue to see that. But that's where you're going to start to see this movement to more of a broad based move.

12:41That's where you know retail's coming in. All right, Joe Cusick, SIBO. Love Chicago, Joe. Tell everybody at Ceres downstairs who said hello as well. Great to have you on the program. Thank you very much. Thanks. 14.5 VIX, Dan Nathan. That's got to even make Dan Nathan a little nervous. Well, let's just put some context into this. If you're looking at the SPY, that's the ETF that tracks S &P 500. You look where it's trading right now, 649. That's basically tracking the 6500 that the SPX is trading at. You can buy an at-the-money put in September 19th expiration, which gets CPI, PPI, and it gets that Fed meeting, it costs one and a quarter percent of the underlying.

13:17Just think about that. If you want to make a bearish bet using options on the SPY and you want it through all those events to September expiration, third Friday in September, it costs you one and a quarter percent. Think about that. Like, it's just absolutely insane. And just especially when you think of just the apathy that's going on, not just the markets and everything else. You talk about these headlines that we're getting three times a day. No one cares. at least the market's lens, you can see that, too. So it's really cheap to buy protection. We say this all the time, though, that if you're doing this too frequently, it's a really big drag on return.

13:50So the idea of doing it tactically, and this could be the exact time to do it, makes a lot of sense. Would you consider that a risk reversal? A risk reversal if you did this, if you sold a call, bought a put or something like that. That would be a risk reversal. And that's your options, actually? May I ask you a question? What's that? What is this establishment that you speak of, this Ciri? Is that what you said? Series. Is that a bar? It's the god of restaurant, diner, and the ground floor. Randolph Street, Sebo. It's the god of fertility or something. Okay, you're saying it in anger. I'm asking you a question, and you're angry at me.

14:22I mean, they might be watching the show right now. You're probably friends with a bartender. It's a diner. Oh. They have a bar. May I say something intelligent for once in 18 years? Gold market is clearly telling a much different story, because gold seemingly is impervious to everything. In an environment where, if you think about it, gold should be actually selling off if equities have done better. Yields come. I mean, there are a lot of reasons to think that the gold market should be faltering. It's not. It continues higher. Silver does as well. Gold miners participating. Bitcoin, although not significantly off the all-time highs, has sold off.

14:57So there are strange things under the surface if you're paying attention. We are paying attention. Everybody out there that's watching and listening, because we love our radio listeners as well, Sirius XM 112. You do. You mention them all the time. Because there's a lot of people that listen on the radio. I know, but it's not a visual thing. They never get acknowledged. I love them, too. I love radio listeners. I love them all. If you're driving, two hands on the wheel. Roman goddess of agriculture. Meantime, a hearing set for tomorrow morning in Fed Governor Lisa Cook's request to block President Trump for firing her.

15:25Steve Leisman has more. Steve. Good afternoon, Brian. The legal outlines of one of the most important cases in Federal Reserve history becoming clear today with the filing of a lawsuit by Fed Governor Lisa Cook to overturn her firing by the President of the United States. Cook called her firing, quote, a clear violation of law and asked a judge for an emergency temporary restraining order to allow her to keep her job and perform her duty. She asked for, quote, a declaration that governors can only be removed, quote, for cause, a declaration that an unsubstantiated allegation does not constitute cause, saying if it were, the president could remove any Fed governor for any allegation.

16:03She wants an injunction against the Fed and Powell from carrying out the president's, quote, illegal attempt to fire her. Cook contends the Fed's independence is at issue if the president could fire a governor based on allegations. The president said in the letter firing Cook three days ago that the mortgage documents he had seen shows, he said, that Cook claimed two primary residences and that was sufficient cause for removal. The president wrote, quote, There is sufficient reason to believe you have made false statements on one or more mortgage agreements, adding that her actions raise questions about her competence and integrity.

16:34So the legal battle lines have been drawn. The president says he can fire her based on what he's seen and what she did before she joined the Fed. Cook responds, these are only allegations not related to her actions as a Fed governor, and that it's all part of an effort to take over the Fed and set interest rates. A hearing on the request for the restraining order set for 10 a.m. tomorrow in D.C. District Court. Brian. Steve Leesman will finally let you sign off. Been on the air since this morning, Steve. We appreciate it. Steve Grasslitz, a family show, so keep it clean. It's a honey badger market.

17:06It doesn't give a you-know-what. And the reality is Vixit 14. Dan's talking about how cheap it is to buy protection on this market. Why doesn't the market seem to be rattled by anything? Well, first of all, there's a huge channel of open-endedness with the Lisa Cook issue. Right? We don't know whether she's going to be removed. So the market is probably looking through that. President Trump has said he's not going to remove the Fed chair. So the market is looking through that. The market continues to go up. Everyone thought tariffs were going to put a lid on the market. We're going to crush earnings.

17:41That didn't happen. So the market just seems to be looking through everything. And a static investing process has been going on. And I think that's what people are thinking. Because ultimately, I think you would agree with this guy, Domi. The S &P 500 is simply a collected measure of future estimates for earnings, and earnings estimates continue to go up. At the bottom line, that's what the stock market is. That's fair. I mean, we're still probably trading at 22-ish times next year. That's historically about four turns higher than we've been. The CAPE ratio, for those that care, but the Shiller P.E., the cost-adjusted P.E., is now trading at levels we haven't seen historically.

18:22In 1929, it was 31. It's 39 now. It's the second highest reading in history. The Buffett indicator, he's still the greatest investor of our lifetime, is now north of 200 percent, 210 percent. He gets concerned at 130 percent. There's no valuation cushion whatsoever in this marketplace. So as Dan would say, have added passive investors. But you bid this market up to levels that we basically have never seen before. Have at it. the best buy in the market right now are the September out-to-buddy puts in the SPY. I'll just be very clear about that. Is that that 1.5 % cost that you just referred to?

18:59It's like 1.1%. 1.1%. Let's review this in September 19th. And where does that stand historically, how cheap that is? Really low. Really, really low. And I think the guy from the SIBO, what he mentioned is that the skew is getting people want more calls than puts. It's usually the other way around. What does that mean? So it means that calls are more expensive than that of puts. If you're looking at an equal out of the money, and I know we're getting into the options action stuff, but just understand that they're reaching for calls more than they're reaching for puts. And does that tell you – again, welcome to options action, everybody.

19:31Does that tell you anything? What were you just, like, defrosted from, like, a million years and under the thing or something? What it tells you is normally people buy put protection all the time, and rather than just buying calls. So it's speaking to a bit of a euphoric market. Skew. Put call skew for you people listening on the radio. By the way, once the show's over, listen to The Frozen Man by James Taylor. It's a fantastic song. Or watch your film Encino Man. Whatever happened to Brendan Fraser? He won an Academy Award. Oh, for the whale. Yeah, sure. Fantastic. All right, coming up, a lot of action happening right now, as you can tell.

20:07Some of that's actually even in the market. From Dell to the Gap payments company, Affirm. We're going to get details on all ahead, plus the surges in Snowflake and Pure Storage, and why one firm is upping the ante on shares of when Fast Money returns, hopefully, right after this question. You're watching Fast Money here on CNBC. We'll be right back.

20:40All right, welcome back. Let's talk Dell. Shares of Dell are down a bit right now. The earnings call started last hour. It is still underway. Christina Parts and Evelis has more on Dell, a stock that's down a little bit over 4%. Yeah, and the reason is because the investors are focusing on the miss for the Q3 guide. The guide came in a little bit light, but when you look on a full-year basis, it's better. So that means that in Q4, it's really going to be last quarter heavy. The company said the reason for that is storage, and that will add to profitability. It's going to see some improvement. specifically.

21:10They're starting to see also some improvement in North America. That is one of their most profitable businesses. They said it was weak, especially coming from the federal side. Why do you think that is, Doge? And I'm sure the narrative that Dell wanted was they are shipping double the amount of AI servers this year,$20 billion. So, you know, that's a huge other portion of their business. For those that don't know, Dell takes, they buy NVIDIA chips, they package them together into AI servers, and then they sell said servers to customers like CoreWeave, for example. That's literally, by the way, what Michael Dell did in his dorm room to start the computer company Dell.

21:46He assembled computers and then resold them. He's just replicating the model that made him one of the world's richest men. When you're doing something right, why not continue it? That's my point. OK.

22:02And so just to point, storage is quite bad. It fell 3 % on the quarter. It seems like a lot of analysts were focusing on that. But they are quite bullish on AI. And they're saying specifically a lot of Blackwell backlog. And overall AI backlog is about a little bit less than$12 billion. You know, and Guy Dami, the headline will be the stock's down 4%. But let's be clear. This was a$37 stock two and a half years ago. Now it's down, and if you're on the radio, I'm doing air quotes. Again with the radio. It's down to$128. Again with the radio. Down to$128. Yeah. So let's not make too much of a 4 % down move.

22:37I mean, the seven people right now are just gleeful. I don't want to make a big deal of it. I'll say this. People will look at valuation and say it's reasonable, and it is reasonable in valuation. It also is one of these things that can become somewhat commoditized as well. I'll say this. Razor-thin margins, I think 7.8 % operating margins. It's not that it's not a good company. It's just that that valuation might be a bit, I don't know, a bit of a sort of a red herring to me. 144, Steve will speak to this. Go back to November of last year. Go back to early August of this year. Bit of a double top.