In short
Fast Money debates whether surging stocks are “disconnected” from rising national debt and stubbornly high yields; covers credit-market risks, corporate borrowing, and rate outlook. Also discusses AI-driven investing tools and retail flows, plus major stock-specific catalysts (Netflix, Apple manufacturing, semis, Workday/HR software, retailers, Brazil EM).
Guests (and backgrounds)
Michael Kantopoulos, head of multi-asset macro investing at Janus Henderson Investors. Neil McDonald, U.S. CEO of Moomoo (online trading platform).
Key claims
- Debt/yields risk is a “slow bleed” (death by a thousand cuts), not an immediate crash, but auctions/foreign demand could trigger an “accident.”
- Structural forces (deglobalization, labor dynamics) support “higher for longer” rates; Fed may need tighter credit transmission.
- Despite rate/credit concerns, earnings growth remains strong; overweight equities but favor “short duration” equity exposures.
- Retail investors are using AI agents on Moomoo to backtest and automate strategies; margin use remains “sensible.”
Notable examples
- U.S. 30-year bond auction at 5.21% (highest in 25+ years); corporate debt up ~27% YoY through July (per cited data).
- Netflix jumps after Bill Ackman’s Pershing Square investment (~$225M); Apple opens Houston plant for Mac minis; SK Hynix up ~20% and Micron gains; Workday +18% on reports; Tapestry down on softer guidance while Birkenstock rallies; Brazil foreign outflows and JPM downgrade.
Written by AI. May contain mistakes. Listen to the episode to check what was said.
Chapters
Tap a time to open that second in VORising Debt Concerns
0:32 to 0:52
Discussion on national and corporate debt levels impacting the market.
“Mazda has been named Consumer Reports' safest new car brand.”
Rising Debt Concerns
1:42 to 2:25
Discussion on national and corporate debt levels impacting the market.
“And we begin with the growing concerns about our rising debt levels for both government and corporate borrowing.”
Disconnect Between Debt and Market
2:25 to 3:43
Explore the current market highs despite rising debt levels and yields.
“There will be people saying at 501.30 that why are you leading with credit and debt and bond yields when the S &P 500 made a new all-time high today and everything looks great.”
Market Resilience Amid Debt
3:43 to 5:10
Analyzing how the stock market remains unaffected by higher debt servicing costs.
“I have thought for a long time it would matter and it doesn't seem to matter at the moment.”
Investor Sentiment Towards Debt
5:10 to 6:39
Discussion on how investors perceive current debt concerns amidst market growth.
“And we've had Fed funds, you know, in and around this sort of 4 percent range or something like that.”
Structural Changes in the Economy
6:39 to 10:40
Examining long-term changes in the economy and their impact on interest rates.
“And that's another part of what investors are going to pay attention to.”
Risks of Higher Rates
10:40 to 12:52
Understanding the potential risks associated with sustained higher interest rates.
“I mean, there's just no doubt that, you know, growth is reasonably strong in the United States.”
Labor Market Dynamics and Economic Outlook
12:52 to 14:00
Exploring the dynamics of the labor market and its impact on economic growth.
“It's a little bit mutually destructive if you do that.”
Market Conditions and Earnings Growth
14:00 to 15:13
Explore current jobless claims, unemployment rates, and the implications for the equity market.
“But you can't argue that you have, you know, some of the lowest jobless claims since the 1960s, a 4.1 % unemployment rate.”
Chip Equipment Earnings and Market Trends
15:15 to 16:18
Discussion on the performance of chip equipment firms and the memory trade's rebound.
“Shares of the chip equipment maker are under some pressure after hours, despite raising its fourth quarter revenue forecast above street expectations, as the Bar for Tech earnings reports remain sky high.”
Show all 24 chapters
NVIDIA's Potential and Stock Volatility
16:19 to 17:33
Delve into NVIDIA's performance, future growth, and the volatility in tech stocks.
“But I think NVIDIA is about ready to take off.”
Apple's New Manufacturing Facility
20:59 to 22:27
Details on Apple's new manufacturing site in Houston and its implications.
“So Apple CEO Tim Cook and Commerce Secretary Howard Lutnick were both on the ground in Houston this afternoon with a lot of fanfare around the opening of Apple's new manufacturing site.”
AI and Apple's Product Strategy
22:28 to 23:35
Examining how Apple's new products fit into the AI landscape and pricing strategy.
“And he told me you're going to interview him the first week of September.”
Apple's Stock Performance and Market Dynamics
23:36 to 24:44
Analyzing Apple's stock trading trends and market performance.
“because this new foldable phone and Mac was on showing us the Google one.”
Reddit Joins the S&P 500
24:45 to 25:38
Discussion on Reddit's inclusion in the S&P 500 and its market implications.
“Apple's not trading on any of these headlines right now.”
Netflix's Investment and Future Prospects
25:39 to 28:00
Analysis of Bill Ackman's investment in Netflix and its future outlook.
“The next episode for Netflix, the big hedge fund bet that has investors streaming back in and whether this rally gets renewed for another season.”
Investor Insights on Netflix and Market Trends
28:00 to 31:00
Discussion on Bill Ackman's investment choices, particularly Netflix, and market speculations.
“I think he's a great investor in a lot of—he swings the bat big, right?”
Retail Trading Trends and AI Integration
31:28 to 39:26
Interview with Neil McDonald discussing retail trader behavior and AI's impact on trading.
“Stocks ending the day higher across the board.”
Retailer Performance: Tapestry vs. Birkenstock
39:26 to 42:00
Analysis of Tapestry and Birkenstock's recent earnings reports and market reactions.
“You know, it's interesting when we see these sorts of tools given to a lot of folks who had not have access to them prior.”
Discussion on Retail Market Trends
42:00 to 42:57
Exploring the growth of DTC brands and retail analyst optimism.
“In fact, I would probably need some Maalox if I saw guys' toes and a pair of Berks' socks.”
Foreign Investment Trends in Brazil
42:57 to 43:26
Analyzing the impact of political uncertainty on Brazilian stocks.
“Foreign investors are pulling out of Brazilian stocks at the fastest pace in five years.”
Investing in Brazilian Equities
43:26 to 45:24
Insights on which Brazilian sectors and stocks to consider for investment.
“And that's causing some uncertainty there.”
Emerging Markets Insights
45:24 to 45:50
Discussing opportunities in emerging markets and sectors like mining.
“That's where you have your Antofagastas and names that people couldn't pronounce.”
Final Trades and Market Predictions
45:50 to 46:38
Hosts share their final stock picks and trading strategies.
“Yeah, last night on Final Trade, I guess that's what we do here.”
Transcript
Automatic transcript. May contain errors.0:00Tim Seymour:At Edward Jones, we believe rich isn't about having life all figured out. It's opening yourself to all the possibilities. That's why your dedicated financial advisor provides long-term planning built around you, meeting you where you are, and helping you get closer to where you want to be. So no matter where you're starting from, you can move forward with confidence.
0:22Melissa Lee:The key to being rich is knowing what counts. Let's find your rich. Edward Jones, member SIPC. Mazda has been named Consumer Reports' safest new car brand. It starts with our approach. Every Mazda comes standard with proactive safety features. So you're more aware of what's around you, more focused on the road ahead, and ready before problems ever start. Mazda. More of what matters most to you. Go to mazdausa.com to learn more. Consumer Reports does not endorse or promote any product.
1:01Tim Seymour:Live from the Nasdaq MarketSite in the heart of New York City's Times Square, this is Fast Money. Here's what's on tap tonight. Doom over debt, the national debt topping$40 trillion. Corporations continuing their borrowing binge and yields across the curve, staying stubbornly high. All this as stocks keep hitting new highs. Why the disconnect? Should you worry? We'll debate that. Plus, streaming higher Netflix shares after buffering for quite some time today. They're surging higher. Is this a breakout you can actually believe in? And later, a major comeback in Korea, Birkenstock fucking the latest shamble in shoes.
1:34Tim Seymour:And a good day for work day. I'm Melissa Lee, Conde, live from Studio B at the NASDAQ. On the desk tonight, Karen Feinerman, Dan Ethan, Guy Adami, and Tim Seymour. And we begin with the growing concerns about our rising debt levels for both government and corporate borrowing. Yes, the S &P 500 hit another all-time high today. And yes, yields did moderate just a bit. But this does come on a day when the U.S. government sold 30-year bonds at the highest interest rate, 5.21 percent, in over 25 years. It is the latest sign that the debt investors want to be compensated to finance the nation's spiraling deficit.
2:07Tim Seymour:When you layer on all the corporate debt that's flooding the market up nearly 27 percent year over year through July, this according to Simfa, tonight we are asking our investors too complacent about the early warning signs coming from the credit market. or do you just hold your nose, buy stocks and mosey along?
2:25Dan Nathan:There will be people saying at 501.30 that why are you leading with credit and debt and bond yields when the S &P 500 made a new all-time high today and everything looks great. Because we know it made a new all-time high and we're doing this to point out some of the things that can go wrong. And I'm glad we are because it was a pretty miserable auction. Maybe miserable is a strong word, but I think Rick Santelli gave it a C +, which is not particularly great. C-minus. Thank you, Sandy Candled in my ear. And, you know, it speaks to one of my concerns for a while. And I do think, listen, think about what we've gotten over the last couple of days.
2:57Dan Nathan:I'm not a believer that things are softening in a material way, but people are saying CPI and PPI came in tame. There's a reason why yields should go lower, but they're not decidedly lower. And one of the reasons is because of the way we're leading the show.
3:10Tim Seymour:Yeah. And the 10-year, at the auction yesterday and the 10-year yield, that wasn't that great either. So this is all, it's not just the 30-year yield that we're seizing on. It's also the 10-year. Well, you probably never got a C - in anything in your life ever, so it's inconceivable that that would happen. But as you opened the show and talked about the$40 trillion, 15 years ago, if you had said, we're going to have a show in 15 years and open with the deficit hits$40 trillion and the market's going berserk, you would have thought one of those two things is improbable or both. And yet, here we are.
3:44I have thought for a long time it would matter and it doesn't seem to matter at the moment. So I think the other parts of the story that an AI is the most, by a lot, the most important, are more important to this market than the deficit.
4:00Melissa Lee:Yeah, and it kind of takes you back to late 21 into 22, right? And we had a stock market mania. We had a risk asset mania in general. And, you know, at some point it became very clear that the Fed was going to be raising interest rates. And I think that where we ended up, the Fed funds, it was probably well below, excuse me, well above where anyone thought at some point in 2021 when the Fed share admitted that he was wrong, I guess. And the stock market had a tough year in 2022, but it was very orderly. Right. And since then, we've had years. Twenty three was up 25 percent. Twenty four was up 25 percent.
4:33Melissa Lee:You know, last year, I think we're up about 20 percent. Here we are. I'm looking at the S &P. It's up 14 percent or something like that. So the stock market has not really been bothered by rates that have been higher than what we've become accustomed to over the last, call it, 10 years or something like that. So you ask yourself, OK, when does that debt load and the debt servicing really matter? We have lots of smart people, much smarter than Guy and me, who come on the program, come on the network, and they're not bothered. You know what I mean? Like they keep just saying, yeah, that'll become a problem at some point.
5:03Melissa Lee:And the stock market now, the S &P, literally from the September 2022 lows, up like 130 some percent or something like that, you know. And we've had Fed funds, you know, in and around this sort of 4 percent range or something like that. So even if the Fed were to do like one and done for a bit, like the stock market goes higher.
5:20Tim Seymour:Steve Eisenman, by the way, I mean, he was on earlier this week, last week, someday when I wasn't here. But he is one who says that these deficits do not matter right now, Tim, and we shouldn't worry about it. And all those people who highlight the deficit all the time and are worry warts about the deficit, they're just doing that to sound smart, basically. The fact of the matter is, though, interest rates look like they are stuck up here and there are upward pressures to keep them higher. So it's not just that we are up here and we're going to come back down. But all that AI issuance, that puts a floor there on rates.
5:54Well, there's a lot to unpack what you just said. I mean, the AI issuance is another dynamic that's put that are putting long rates higher. And this is where they're issuing. They're issuing. This is long dated debt to to match liabilities to long dated projects and projects we don't know a whole lot about to get into the deep end of the fixed income pool. duration time spread or DTS, which is just that. It's the amount of bonds outstanding times the duration and the spread over them. The hyperscalers are now a bigger part of the corporate debt market than bank debt. And that's crazy to think about when you do it on a DTS basis.
6:29And that's a risk basis. So much like the U.S. government, who is issuing long and is paying more and paying more than they have in 25 years to issue long, there's term risk. And that's another part of what investors are going to pay attention to. I think in the short run, deficits matter a lot less when our deficit relative to some other places, or at least on a basis of credit worthiness, it probably doesn't matter. When you add it to the dynamic that there is inflation, you have to understand that the Fed is committed to inflation and nothing else. And I think that's where we are today. Fitch just on the tape.
7:03I don't know if anybody cares about Fitch anymore, but they were talking just about the interest burden. They were just talking about a fiscal spending environment that needs to get better. They're basically saying that the credit limit is constrained by that. So we will be talking about this for a while. And I still think we're in an upward trend in long interest rates.
7:22Tim Seymour:Does any of this make you feel differently, Guy, about stock market levels and valuations?
7:28Dan Nathan:You know, I mean, I've been concerned about this for how many hundreds of S &P points. So the answer is nothing is assuaging those concerns, but the market continues to do its thing. So you become the boy that cried wolf because as the market goes, it's judge and jury. But no, it doesn't, makes me feel worse about things. Now, people will say, maybe correctly, that, you know what, valuations are not the same concern they were maybe a year or so ago because of the earnings growth that we're seeing. Of course, the problem with this, if there's a problem, it's the earnings growth is consolidated in a very, not narrow sector, but a sector we seem to talk about all the time.
8:00Dan Nathan:So seemingly rates don't matter because of that earnings growth. and people say, wait a second, the valuations are reasonable. The problem, of course, is if that sort of cube, that block's taken out, then all of a sudden people look, wait a second, rates are almost 4.7%. Debt load is this. By the way, all the companies that are looking to raise debt, I mean, that's problematic.
8:19Tim Seymour:I mean, that sector that's driving the market higher is dependent on borrowing at these high rates. Yes, although, I mean, they're great credits. Yeah. Right? So I'm always long. So regardless of what the market's doing, I'm always long. I do like good balance sheets. And when I have, you know, a big bet like the hyperscalers and Dell and NVIDIA, I want a good balance sheet. So I mean, I think they're going to keep borrowing and then maybe issue equity as well, which is a more expensive and cheaper way to pay for it, depending on how you think about cost of capital. But it's not changing. I'm not not changing my portfolio.
9:01All right.
9:02Tim Seymour:For more on all of this, let's bring in Michael Cantopoulos to the conversation. He is, of course, head of multi-asset macro investing at Janus Henderson Investors. Michael, it's always good to see you. Thank you. How do you think about this looming issue? Because it's been an issue for decades now. And a lot of people will say, you know what? Who cares? We're here on the S &P 500, all time highs. Yeah, my entire career, we've cared about the deficit. And, you know, I've heard that it's going to blow things up and it hasn't done so yet. and long before my career started as well. With that said, I mean, obviously, you hit a tipping point because unlike any other time in history, you have massively expanding deficits at the time of much higher interest rates, and you're coming from such a low base.
9:42It just starts to accumulate, and you could risk shocks. With that said, I am sort of in the camp that this is more death by 1 ,000 cuts than it is by arsenic, notwithstanding some sort of fiscal calamity, of course, which I call it the Liz Truss moment. But, you know, apps in some kind of Liz Truss moment, you know, I think this is kind of going to be a slow bleed.
10:03Tim Seymour:Where do you see rates going from? I mean, do you think that there is something structural about what is going on here at this point to keep rates just higher? Yeah, we're definitely in a higher for a longer environment. We've pretty much said that since, you know, 2021. We continue to believe that we're now, you know, basically five and a half plus years into a higher rate environment. There are real structural changes in the global economy to assume that you're going to have higher rates. You have changing labor dynamics. You've got deglobalization, probably your biggest reason for higher interest rates and higher inflation going forward.
10:37And then more cyclically in what's going on today, you've just got strong growth. I mean, there's just no doubt that, you know, growth is reasonably strong in the United States. Earnings growth throughout the world is accelerating. All of these secular and cyclical forces probably mean you're going to go higher, not lower.
10:51Tim Seymour:So you think that rates are higher and probably remain high for the right reasons, so to speak, as opposed to the wrong reasons, which would be concerns about inflation and maybe the Fed could lose control of the long end of the curve? Well, I think it's both. OK. I think the answer is yes. And that's what makes it somewhat dangerous. Right. And that's why, you know, although you could argue this is a slow bleed, death by a thousand cuts, as I mentioned earlier, you're getting much closer to an accident. Right. Because you have these secular forces pushing up inflation and pushing up rates at the same time that you've got rates going up for a good reason.
11:27And I think you're starting to see the Fed pay attention to that. I mean, you're no longer hearing about cuts. You're now hearing about hikes. The problem is they're just not aggressive enough. And I've been on the show many times where I've talked that the transmission mechanism of monetary policy is through credit channels. Credit spreads are at all time tights. We're not tight. So they need to they need to tighten policy. So what's the most likely type of accident that we see? You get either a very, very weak auction, a failed auction, something of that nature, a buyer strike, most likely from foreign investors.
11:59That's what I would be worried about. And the more the Fed speaks hawkishly, the less of a chance that actually has to happen. It's when you have, you know, massive amounts of fiscal and monetary stimulus coupled with a Fed that doesn't do anything about it. that's when you get the accident. It seems like their move to being slightly more hawkish starts to take that a little bit off the table. But what I would be fearful of is that the Fed somehow, you know, sees lower inflation prints recently with energy prices coming down, and they start to react more dovishly. And I think that sets up a potential for, you know, some sort of buyer strike for treasuries.
12:41Tim Seymour:Or are we in a much more precarious position when some of the largest holders of treasuries decide to sell? for instance, of Japan. I mean, maybe that's why we went in with intervention. Or China could pull that card as well. They could. It's a little bit mutually destructive if you do that. And so I think there's some protections there. But I do think that's largely why Besson has gone into Japan and is helping to support the yen and is playing friendly internationally. So I think there's some truth to that, Melissa. But at the end of the day, I think everybody's looking out for their own best interests.
13:14And that necessarily isn't in everybody's best interest.
13:17Dan Nathan:We had a conversation about the labor market last night, I was pushed back on. I don't think the labor market is as strong as a 4.1 percent unemployment rate suggests, but it is what it is. Maybe it is, but there are other factors at work that suggest with revisions and stuff and the predominance of jobs in health care that maybe it's not that strong because if the employment picture is not great, that throws a monkey wrench in this entire thing. It absolutely would, Guy. There's a lot of conflicting signals, obviously, in the labor market and a lot of labor dynamics going on with immigration, 12 ,000 baby boomers retiring every single day.
13:51So there's a lot of sort of competing things that are happening. I don't disagree. Labor and profits ultimately are going to decide what happens with the economy, what happens with the equity market, probably what happens with rates as well. But you can't argue that you have, you know, some of the lowest jobless claims since the 1960s, a 4.1 % unemployment rate. Those are real numbers. They're not made up. It might not be the highest quality employment numbers that we've seen, but they are reasonably strong. And when you have reasonably strong employment, you have two to three percent GDP and you've got 20 plus percent earnings growth plus inflation that's nowhere near target.
14:24I'm not sure if that's a picture for lower yields.
14:28Tim Seymour:OK, so all that said, far from the trees, are you bullish this market? S &P 500, 7800, basically. Yeah. The other thing I talk a lot about is earnings growth matters more than anything else. And earnings growth remains strong. So we are constructive on the equity market. We're constructive on lower duration areas of the equity market. A lot of people think about rate sensitivity being a fixed income only construct, but it also works in equities as well. High dividend payers are short duration. Value tends to be short duration, whereas growth, the hyperscalers, those types tend to be longer duration.
15:04So we actually are overweight equities in our portfolios, but we are doing it more in the shorter duration equity space.
15:11Tim Seymour:Michael, thank you. Thank you. Good to see you, Michael Katopoulos. Earnings alert now and applied material. Shares of the chip equipment maker are under some pressure after hours, despite raising its fourth quarter revenue forecast above street expectations, as the Bar for Tech earnings reports remain sky high. The conference call is ongoing. Meanwhile, the rebound in the memory trade continues. SK Hynix up a whopping 20 percent this week, while Micron posting back-to-back days of more than 4 percent gains. And, of course, we should note the KOSPI in a technical bull market once again, Tim. So it de-risked and now it's re-risking.
15:45Well, you're back through that 50. You've gone aggressively through it in Korea. So up 30 percent off that July 29 bounce. I do think we're back in a semis market. But say what you want about. And again, we can see this with AMAT and earnings for certain parts of the overspent and certainly overinflated share prices. But I also would bring this back to NVIDIA. I still think NVIDIA is the key. And I think NVIDIA has been biding its time. I know all we've done is talk about the gathering that NVIDIA had on Monday. And I worry about NVIDIA trading at a discount almost like a holding company does because of how they have positioned their AI infrastructure exposure.
16:25But I think NVIDIA is about ready to take off. And I think this is going to continue to lift semis. So I would not be a seller of this move. This is different than a view we've just had on rates and credit. But right now, growth is winning.
16:39Melissa Lee:Yeah, as far as growth is concerned, I mean, we had Sandus this morning in their analyst meeting. And, you know, the guidance that they gave and we're looking at 27 through 30. I think that was some of the metrics and it looks great. And I think you'd probably have to expect that right here, despite the fact the stocks sold off 50 % from those highs a couple months ago. I think the quarter that they reported was fine. I think relative to the expectations at the time, I think it goes back a week, week and a half or so, it didn't clear a bar. But when you look out this much further, 27, 28, it gives you more confidence.
17:12Melissa Lee:The only problem I have with that is at some point in the not so distant future, you're going to start as an investor discounting a little bit of that. And you're going to see this major deceleration, which is what is built in right there. But these stocks are cheap. And if you believe the cycles are longer than a lot of folks that are skeptical, I'm one of them, then, you know, then you buy this thing as it was down 50 percent from those highs. It's not something I'm interested in doing because I think that this is going to be the eye of the storm when you do see a pullback in some sort of demand.
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17:40Melissa Lee:And maybe that's a 2027 thing. But between now and then, you know, the stock could make up a lot of room from where it came from a couple months ago. So to Tim's point on a video, I agree with him. I thought it was excessively cheap for a while. The only thing I don't like about the setup going into earnings, which is August 26th, is the run that it's had. I mean, it got caught up in the whole situational awareness. It's up, I don't know,$28 from there maybe. But I'm staying long for sure.
18:06Dan Nathan:Look at the quarter of AMAT since we brought it up. It was, by all metrics, very good quarter. Beat and raise, right? Revenue better. Not a ridiculous valuation if you really look at it in terms of the earnings growth they have. But look at the price action. I mean, this was a$735 stock, I think, at the end of June. Traded down to$435, almost in a straight line. Bounced. Now here we are,$505,$510 or so. The volatility is staggering. And that speaks again. That just reinforces some of the things we've been saying here. Mandy Zhu talks about this. Individual stock volatility continues to be almost historic, yet the VIX is nowhere.
18:41Dan Nathan:And the question remains, is it a matter of time before the VIX sort of sniffs us out, or is that just where we live right now?
18:48Tim Seymour:Coming up from Cupertino to Houston, we are going inside Apple's brand-new Texas manufacturing site and the mini-computer coming to the large Lone Star State, plus a streaming war winner. Our billionaire Bill Ackman says Netflix is miles ahead of its peers. And the big bet he is making on another season of growth. Don't go anywhere. Fast Money's back in two.
19:09Melissa Lee:This is Fast Money with Melissa Lee, right here on CNBC.
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20:50Tim Seymour:Welcome back to Fast Money. Apple opening a new manufacturing facility in Houston. The plant's set to begin producing Mac minis later this year. Mackenzie Cigalas is here with all the details. Hey, Mac. Hey, Mel.
21:00Melissa Lee:So Apple CEO Tim Cook and Commerce Secretary Howard Lutnick were both on the ground in Houston this afternoon with a lot of fanfare around the opening of Apple's new manufacturing site. Now, Cook says they've already started shipping advanced AI servers from the facility and later this year will begin producing the Mac Mini there. This is the first time that a consumer-facing product will be made in the U.S. In less than nine months, we have invested hundreds of millions of dollars here. With Mac Mini production set to begin later this year, the most powerful Mac Mini we've ever built, we have no intention of slowing down.
21:39Cook also put numbers around Apple's broader U.S. buildout, more than 20 billion chips sourced from 24 U.S. factories last year and more than 100 million expected from TSMC's Arizona plant. Lutnick, meanwhile, cast Apple as a company that can help lead a broader return of advanced manufacturing to the U.S. But there is something in this for both sides. The administration gets
22:02Melissa Lee:a marquee example of its manufacturing push, while Apple gets a bargaining chip in its relationship with the Commerce Department at a critical time, too, when the company is reportedly testing Chinese memory, which still requires the department's permission to add into its supply chain.
22:16Tim Seymour:Mel? All right. Mac, thanks. Mackenzie Cigalos. You know, part of the desire to have Mac Minis is that it's a smaller, local, energy-efficient server for large language models and other AI uses. We were talking to BK Brian Kelly. Did you guys talk to him today? No, did you talk to him today? I didn't talk to him. Did you talk to him about this? We talked to him. You did.
22:40Melissa Lee:And he told me you're going to interview him the first week of September. Yes, we're going to do a whole thing.
22:44Tim Seymour:We don't want to spill the beans. Well, you just did. Spill the beans. But basically, these are used to run AI agents in your own businesses, et cetera. Well, BK was telling us about all his own agents. Right, exactly. That he's got. Yeah, no. Don't spill the beans. He's got an army.
22:59Melissa Lee:The thing is, is that we're this is how the stories are getting stretched out a little bit as far as different places to express views in AI. And there's there's nothing wrong with this. I mean, when you think about it the other way, as far as its contribution to Apple's sales, I mean, it's tiny, you know. And so that's great that they're going to bring advanced manufacturing back here. This comes at a time where Apple's already told us that the constraints as they look for memory to put in their iPhones and they got a big one coming up here in the fall. They're going to have to raise prices. Right.
23:26Melissa Lee:And just think about reshoring. that's also going to become more expensive. You might see replacement time cycles. You might see them stretched out because of this, because of increased costs as it relates to that, because this new foldable phone and Mac was on showing us the Google one.
23:41Tim Seymour:It's nice, right? Yeah. Are you going to get one?
23:42Melissa Lee:No, it's going to be$2 ,000. Oh. That's more than a Mac mini, Mel. That's more than... But you love all the gadgets. No, I don't. I mean, this is like the most dope phone they've ever made. This is like the thin one, the iPad. This is a great example. Less than 5 % of the phones that they sold last year were this Air phone. It's a great phone.
24:05Dan Nathan:We have a crack staff in EC that we mention all the time. I mean, I don't know if they're able to do this on the fly, although I'm sure they are. But there is an uptrend that's been in place since the March law of about 250. If you connect that next low, the low that we made, I believe, in June of this year, believe it or not. And we have just reached basically the third point of an uptrend. So I think Tim would agree, because I know him very well, that, you know, this is sort of a garden variety sell off in Apple that we've seen dozens of times before. And we stopped pretty much where we should have, I guess.
24:33Tim, do you agree? Yeah, I totally disagree with that. No, I'm just kidding. I agree with it. In fact, what I was going to point out is this is all great news and it makes for great headlines. And McKenzie has always did a great job. Apple's not trading on any of these headlines right now. In fact, Apple is trading on the charts. And if you take that that gap down from July 29th when the rest of the market bounced, in other words, Apple as the defensive play sold off as much because it wasn't a semiconductor that was oversold and the momentum that was bought. I think this chart looks great. But I think that the the the iPhone sales dynamic is something that has been very encouraging.
25:10At one point, we were just saying pull forward, et cetera. But I'm going to go back to saying it's less about fundamentals right now than it is about Apple and their balance sheet. and they're not spending.
25:21Tim Seymour:We've got a news alert right now on changes in the S &P 500. Reddit will be joining the S &P 500 effective prior to the opening of trading on Tuesday, August 18th. Reddit will replace Avalon Bay communities in the index. You see Reddit there moving higher. Is that in Sandy's acronym? Is it? Sandy, is that in your acronym? Two years, okay. Two years ago, it doesn't count. All right. Too late. All right. A lot more Fast Money to come. Here's what's coming up next.
25:50Melissa Lee:The next episode for Netflix, the big hedge fund bet that has investors streaming back in and whether this rally gets renewed for another season. Plus, taking the pulse of retail traders, a major trading platform says AI is changing the investing playbook, where the money is moving and what it could signal for the market. You're watching Fast Money live from the NASDAQ market side in Times Square. We're back right after this.
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27:37Tim Seymour:Welcome back to Fast Money. Shares of Netflix finishing the day up over 5%. This after Bill Ackman of Pershing Square said his hedge fund is making a major investment in the company. This is Ackman's first return to the streamer since he abruptly exited four years ago after losing around$400 million. Netflix is currently down over 40 percent from its 2025 all-time high. You with Bill? I am. I get a kick out of Bill. I think he's a great investor in a lot of—he swings the bat big, right? This isn't a huge bet for him. I think it was$225 million worth. It looked like the average price was around$71.40.
28:17So he seems to have bought it well. That was at the end. I don't know if he's bought more since. Doesn't have a big enough position to file. But, I mean, he's had some huge blowups and some huge winners as well. General growth properties, this levered real estate play, going back to the great financial crisis, was extraordinary. And then on the other hand, you have something like a valiant disaster. Chipotle, giant score. So he's an interesting investor. I don't read anything to what he did last time around. I don't think it's relevant. $400 million is, I'm sure, quite painful to lose. Maybe not for his size.
28:55Tim Seymour:He says this time around he's even more confident in Netflix, by the way. And he also bought a lot of other stocks, Visa, MasterCard, ICE, S &B Global.
29:04Dan Nathan:There's a reason to be optimistic here. just valuation alone and the amount of just froth that's been taken out of the name. And I think on a technical basis, and let me be clear here, I thought Netflix would stop countless times over the last six to nine months, and it hasn't. But it recently stopped at the prior all-time high from October of 2021, if you want to go back and look, around 68.5, 69. That's a good sign. Now, we're bouncing on decent volume. Suggests at least you have something to trade around. So my feelings about him notwithstanding, I actually think you could follow him into this trade.
29:35Tim Seymour:What would those feelings be, guys?
29:36Dan Nathan:I just said, notwithstanding. I know, I know. Mine are standing. Excuse me? Mine are still standing. Tim? Well, I think it's a story of size, and this is part of his argument. The sub base of$325 million is dominant, and it's more than the combined two competitors. The valuation is interesting. The concern might be for people that say, hey, you know, the viewing hours kind of fell. Some of those metrics on a relative basis relative to the spend on new content. And that might be part of the concern, the free cash flow less than you might expect. At some point, at least in a world where they're not dumping a lot of money into some new frontier, you would think this company would be paying out more to shareholders.
30:20Just saying, you know, I like it here. I'm long in here. And I think it is an interesting place to own it without a big catalyst.
30:28Melissa Lee:Yeah. Next year, I think expectations are really low. And if you think of earnings expected to be like high single digits, I don't think this company has ever printed a high single digits growth number as it relates to earnings. And every time you want to count this company out, I think it seems to be a mistake a little bit. So if this is a retooling year and it seems to be that sort of thing, I think a lot of folks were asking questions about the Warner bid. And then you look at some of the other metrics and you look at what expectations are for next year. It does seem to be like it's not that risky of a bet right here.
30:58Tim Seymour:Coming up, a fresh read on the retail trader. the U.S. CEO of Moomoo joins us next to dive into the trends he is seeing on the platform and how a new generation of investors is stepping up its game. More Fast Money right after this.
31:11Melissa Lee:Missed a moment of Fast? Catch us anytime on the go. Follow the Fast Money podcast. We're back right after this.
31:28Tim Seymour:Welcome back to Fast Money. Stocks ending the day higher across the board. The Dow adding 70 points to snap a three-day losing streak. The S &P up two-thirds of a percent to close at records. And the Nasdaq gaining nearly a percent. Workday soaring late in the session to close 18 percent higher. Reuters reporting that private equity firm Silver Lake is in talks to buy the HR software maker. StubHub, meanwhile, sinking 10 percent after last night's earnings miss, even with a big tailwind from the World Cup in Q2. The company's latest guidance underwhelmed investors. And Starbucks heading its highest level since March 2025.
32:00Tim Seymour:This year alone, shares have surged nearly 30 percent. I want to go to Workday only because we saw the whole IGV turn higher on the back of this. Workdays would be a huge bite, Karen, for anybody. $43 billion prior to the PUPs. Oh, that's me. Sorry. I don't know. I don't know. I didn't even know what I just said. That is really sorry about. But as I was saying, just say it again. I'm sorry. Is that prior to today's pop? There's a forty three billion dollar market cap. So 43. And then plus the premium. It's enormous. It is enormous. And I'm not sure. Have they confirmed it? No, I think we know.
32:39And there seemed to be a little bit of leak, maybe. Perhaps. Perhaps. But it is a very big deal. It's no surprise that that would be very good news for the whole space. Right. And, you know, private equity firms, just like any animal, move in packs. They see one of them does something. There's a there's a great need to feel like, all right, I got to do something. It's time. The bottom's in. I got to buy.
33:02Melissa Lee:Yeah, this makes some sense, though, if you think about it. Like we've talked a lot about the A.I. disruption aspect of this. And these companies have huge installed bases. Right. And so a lot of like large businesses are not going to rip these things out anytime soon. And so if you are private equity and you're looking at a company like this expected to grow earnings high teens for the next couple of years, your gross margins have improved year over year and you still have revenue growth that's like 10 percent or something like that. You say to yourself, if the numbers aren't going to degrade that much, if the disruption is overdone in the near term, then this is a company that probably can get retooled to some degree.
33:35Melissa Lee:And it's going to make some sense. I do think, though, it's also going to cause some smaller names in the single-digit billions to see some strategic acquisitions. And it might be from some of these AI companies who are looking to pick up some of these customer bases, if you will. So, again, I think this makes sense. ServiceNow is probably on the list, too.
33:53Dan Nathan:Look, I don't know what percentage workday is of the IGV, if any. But what I'll say is this reinforces, I think, the bull case for the IGV. I think these stocks are now in play. And we've said for a while that the IGV can trade to the mid-1 teens. And I continue to stand by that. All right.
34:07Tim Seymour:Meantime, retail investors are still leaning into big tech, according to online trading platform Moomoo. Almost 50 percent of their users hold at least one Mag7 stock. For more of how the gamers are playing the market, let's bring in Neil McDonald, the U.S. CEO of Moomoo. Neil, great to see you again.
34:24Melissa Lee:Thank you. Great to be back, guys.
34:26Tim Seymour:What have they – we saw a de-risking in the market, a re-risking in the market. I mean, how have you noticed retail traders ride that?
34:33Melissa Lee:So I was looking today at the percentage of our clients that either own the Semis or just the Mag7. So Semis X, NVIDIA, then the Mag7. So beginning of the year, 31%, 32%. It climbed, dipped a touch, but then the big acceleration has been with the sell-offs. So they've used the market disruption to actually add. And for the Semis X, NVIDIA, and the Mag7 with NVIDIA, they're both at highs. And what's interesting is the U.S. domestic clients compared to our Asian clients, we're always seven or eight percentage points behind. The U.S. clients in the semis in the last two months have caught up and are now at higher than our Asian clients.
35:18Dan Nathan:Speaks to a level of sophistication in retail traders that probably wasn't there pre-COVID. I mean, typically on the bottom, those numbers would diminish. And now you're seeing they're actually growing. People are taking advantage of sell-offs. So my question to you is that's one sector, but I see aerospace defense is another one, which historically, in terms of retail traders, they probably would not necessarily traffic in.
35:39Melissa Lee:No, I think a lot of it's down to the AI, sort of the AI component that we have. So you can ask all sorts of questions. Find me a stock with this earnings growth, with this market cap that has this many recommendations. And so the universe of stocks is too much for most people. With our AI app, you can screen them much more efficiently. you can do months of research in like 10 minutes. So a retail client may not have looked at aerospace because they care about the Mag 7, they care about what's hidden in the headlines, but all of a sudden they're finding value in sectors that they hadn't looked at previously.
36:13Unless it's SpaceX. SpaceX, yeah. So let me ask you about the margin use over the course of the down and the up. How has that changed? Where is it now?
36:23Melissa Lee:It got slightly extended, I think, before the sell-off. Well, it's all kind of changed now with the change in the rules. We haven't seen a big, big difference in people using margin. Our average account is$70 ,000,$75 ,000. So we don't have a lot of the smaller$2 ,500,$5 ,000 accounts who can now use margin who couldn't use that previously. Or the sub -$2 ,000 accounts. So we haven't seen a big difference. Our clients do use margin, but we see them using it sensibly.
36:55Tim Seymour:In terms of the AI sort of companion that you have that people can utilize, what are some of the most common queries? And are you finding, and what have you found in terms of the uptake of the usage of this feature? It's been astonishing.
37:09Melissa Lee:Absolutely tremendous. So it's 139 % growth in number of people using the agentic AI. Volume's up 4x, and now it's a considerable material part of our overall volume. So we have this big community of 30 million people. We have this very active chat room that's global. It's super busy. We have hundreds of thousands of daily interactions. And I ask the questions of the clients. I speak to them all the time. So I used to work for Ken Griffin for years, right? And everything we did at Citadel was completely automated. My best trading day was when I didn't press a button. And I had an army of engineers and people to code for me.
37:52Melissa Lee:and we had a big backtesting infrastructure. All of that was now available on the Moomoo platform. So, for example, I asked today, give me some examples, what are you guys using it for? One of the clients had just a natural language, stress test my portfolio if the Nasdaq's down 5%, 10%, 15%. He didn't like the 10 % down. Find me a cheapest option strategy, built one for them, clicked, traded it. Wow. And so that would take you a while to research. We have clients who are more technical, so they'll look at if the RSI is above 80, sell me 10. If it's below 20, buy me 10. You backtest it. And it runs all day, right?
38:36Melissa Lee:We've all got day jobs. We're watching CNBC. We're walking the dog. We're going for a coffee. In that order, hopefully. But this runs, yeah, in that order. And this just runs all day for you. So it takes the emotion out of trading.
38:48Tim Seymour:Right.
38:49Melissa Lee:We've all traded. We all know the worst trades you do are when you panic in or you panic out and you don't have a strategy. So the constant narrative from our clients is it just takes away the emotional trading.
39:02Tim Seymour:Neil, always great to see you. Thank you. Thank you very much, guys. Neil McDonald, the U.S. CEO of Moomoo.
39:08Dan Nathan:I mean, it speaks to the sophistication of their client base. And the other thing that we didn't get a chance to talk to, I mean, Bitcoin has been abandoned by a lot of people. And rightly so, because it hasn't moved now probably in six months. But, you know, and the notes suggest people are really looking at Bitcoin again. So if they were right about, you know, some of the other names, semis and some of the other things on the sell off, maybe it's worth looking at crypto again.
39:27Melissa Lee:You know, it's interesting when we see these sorts of tools given to a lot of folks who had not have access to them prior. You know, we're seeing a proliferation of a lot of new products also. And I think that probably enables that to some degree. If you think about event contracts or single stock futures and a whole host of other things. So these platforms, they kind of keep up, I guess, with the technology as quickly as it is improving. And we're seeing that with a lot of these models. So the integration, I think, is great for a lot of these companies.
39:53Tim Seymour:Coming up, the latest results sending a pair of retailers in opposite directions. Why Tapestry is taking a beating. And is the Birkenstock bounce enough to get Guy Dami to slip his tootsies into a pair of sandals? Fast Money is back right after this.
40:12Tim Seymour:Welcome back to Fast Money, a tale of two retailers. Tapestry falling over 16 % despite a beat on earnings. The coach and Kate Spade Parent issued softer than expected fiscal 2027 revenue and profit guidance on the flip-flop side, pun intended. Shares of Birkenstock climbing nearly 12 % on an earnings beat and better than expected sales this quarter. What is Tapestry getting wrong here? Guidance. I mean, the quarter wasn't bad. It was just disappointing guidance. And, I mean, it's really, it's a coach story. Heath Spade is very much not really. Impactful. Right, exactly. Not so impactful. So I think it was the guidance.
40:50They've done a great job. It was expensive-ish going in. Ralph Lauren, who was often seen as a competitor, had a better quarter. I mean, better, you know, the outlook was better. So I think it was just a little bit too expensive going in and maybe a little bit overdone here, but I don't own it.
41:08Tim Seymour:Birkenstock revenue in the Americas up 11 percent in EMEA, up 15 percent in Asia, up 18 percent. Everybody wants to wear Birkenstocks, Guy.
41:20Dan Nathan:I'll let Tim do the Birkenstock thing. No, it is a great story. I mean, I am not a Birkenstock wearer. I hate feet. I don't like my feet and I don't want to see your feet. But let me quickly pivot back to tapestry, if I may, because operating margins were like 19 and a half percent. Karen, you over here, that's very good. And Karen, of course, is always right. It's strictly a coach story. The problem, if there is one, look at the run the stock has had over the last couple of years. So had a historic run. It's trading back down to levels that it bounced off of, I want to say, in May. I actually I'm going to be crazy.
41:52Dan Nathan:I think you buy the stock. All right, Tim, I'll let you pick bags or Burks. I'll go Berks, not because I want to see guys' tootsies in there. In fact, I would probably need some Maalox if I saw guys' toes and a pair of Berks' socks. So I think it's a story of across all segments. You talked about the geographies, but they're growing everywhere they go. There's an argument that their DTC presence just reinforces that. And that DTC part of it is where I think the analyst community, which is incredibly bullish on the name, by the way, for a stock that's done nothing since its IPO, the retail analyst community, those covering discretionary spend, seem to want this thing to be a lot higher.
42:29That would be I don't know. These were fantastic numbers. The demand is there. It's crazy, but it is there. And there's probably 19 pairs of Birks in my house and they're not mine.
42:41Tim Seymour:Coming up, betting on Brazil is now the time to buy weakness in the South American market or bolt from the Bovespa will grill the ambassador. And here's a sneak peek at the Kramer cam. Jim is chatting exclusively with the CEO of Stanley Black and Decker. Catch the full interview, top of the hour on Mad Money. Meantime, more Fast Money in two.
43:05Tim Seymour:Welcome back to Fast Money. Foreign investors are pulling out of Brazilian stocks at the fastest pace in five years. J.P. Morgan just this week downgrading Brazilian equities, citing the end of their monetary easing cycle, slowing growth and political uncertainty. The iShares MSCI Brasil ETF EWZ is down nearly 6 % this week. And this all comes, of course, ahead of an October election. And Lula right now, Tim, is in the lead. And that's causing some uncertainty there. Yeah, I think the election cycle is what it's all about. You know, Lula versus Bolsonaro. You have a dynamic where there's really some concern about moving back to more extreme socialist, say, policies, things that also would be negative on the BRL.
43:44So the real, which has been a big part of the it was part of the bullish trade. I like Brazilian banks here. Itaú has got a great both balance sheet and an approach to, say, credit risk and NPLs, and in fact, is growing and their NIMS are fantastic. We've seen a lot of very strong net interest margin numbers out of Latin banks. I'm long Itaú in Idebo. I'm long Petrobras in Idebo. I mean, I think Brazil is not the hottest EM market to play. And in fact, Mexico, even south of the border, has been more resilient, especially on the consumer side. I think if you look at EM more broadly, you're just off all-time highs.
44:19And as the big three or the MAG three of EM, Taiwan Semi, Hynix and Samsung go, so goes EM. International markets are starting to pick up their mojo. And I just say this, if you actually have some kind of normalization in the Middle East over the next one to two months, I think international is going to outperform the S &P as it was. In the meantime, I think you're selective.
44:41Tim Seymour:Are you going to speak Brazilian Portuguese?
44:44Dan Nathan:No, I will refrain from that because I don't want to take up too much. I like what you did there. I will echo some of Tim's sentiments and say mining stocks, you have mining, you have energy and you have banks. I mean, think about what those three sectors have done here. And I think I think you're getting them at a discount there. So I get the downgrade. I get the concerns. I think the sell off in the stock over the last month sort of encapsulates that.
45:07Tim Seymour:Yeah. If you're a believer, we've talked so many times about the commodity cycle, Tim, and copper and, you know, Now, which which emerging market is the most exposed if you want to play that way? Peru, Peru and Chile. EPU is Peru. I think ECH is Chile. Those are ETFs you can own. That's where you have your Antofagastas and names that people couldn't pronounce. But I can. And I think that's interesting. Once again, I don't know that you should be putting an enormous amount of an allocation. and even in copper, which I believe long term and structurally, et cetera, is going higher. Copper is at all time highs and you don't hear about the infrastructure buildup that we used to.
45:47So there you go. All right.
45:50Tim Seymour:Thank you, Ambassador. Up next, Final Trades.
46:05time for the final trade timbo yeah i can trade nvidia from the long side in fact i am long 21 times forward through the 50 day nvidia erin yes i like netflix you know i would say if you go home long it's the same as buying it here i would buy netflix here that's what phil axman did sort of an interesting catalyst. Dan?
46:24Melissa Lee:Yeah, last night on Final Trade, I guess that's what we do here. I thought Cisco, you buy the weakness.
46:29Dan Nathan:I still think you do. Bye. I had fun. I wish Tim was here. It's fun when he's here.
46:34Tim Seymour:He's here. Thank you.
46:35Dan Nathan:Well, no, sitting physically there.
46:37Tim Seymour:Physically here. IGV, pretty good like this. All right. Thanks for watching Fast Money. He starts right now.
46:44Melissa Lee:All opinions expressed by the Fast Money participants are solely their opinions and do not reflect the opinions of CNBC or its parent company or affiliates and may have been previously disseminated by them on television, radio, internet, or another medium. You should not treat any opinion expressed on this podcast as a 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.
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From the publisher
The national debt topping 40 trillion as stocks keep setting new records.The traders debate if the disconnect is too big to ignore. Then, MooMoo U.S. CEO Neil McDonald shares the latest read from the retail investor and how their strategies are changing thanks to AI. Plus, what’s next for Netflix after Pershing Square’s Bill Ackman new stake, Birkenstock finding its footing after earnings and Applied Materials latest quarterly results.
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