Morning Call 9/4/26

0:00These will hit the record high. I'm Morgan Brennan and this is your morning call. Good Friday morning. Let's get a look at U.S. stock futures after Wall Street's best day in a month. Big rally, major gains more than 1% for all the major averages yesterday, which has taken us into the green for the major averages. On the week, you could see it's a little bit of a mixed picture here this morning, pre-market though. The S&P 500 is poised to open up less than one point right now. The Dow down 26 points and the Nasdaq poised for a gain of 113 points. Meantime, we're focused on yields. As we've seen some stabilization, we'll call it in the global yield, a global bond market. So take a look at what we're seeing in treasuries right now. U.S. 10-year treasurer yielding 4.75%. So we're off the highs that we saw earlier in trading in this week. And the Fed sensitive to your

1:03treasurer, 4.34%, the 30-year treasurer yielding 5.23%. Let's get a check on the Dollar Index too, which is a bit firmer this morning. After we saw a worst day for the Dollar Index since, we'll say mid-August yesterday. The level there in 909.07 and speaking of currencies, some of the big moves and volatility we have seen across the FX markets this week has been tied to the Yen. So let's get a check there as well because the Yen is retreating this morning against the Dollar. And that was after a very big spike that we saw earlier this week. Still on pace though, for its strongest week of gains since late July. And you can see the level right here still trading around $156 per dollar. Breaking this morning, the energy sector, the price of diesel, hitting an all-time high. That's according to Triple A, national average for a gallon is now sitting at $5.85. And that is your passing to previous high that was hit back in 2022. So if we watch the rest of the energy sector right now with the WTI on pace for best week since mid-July under a little bit of pressure

2:08this morning, down about half a percent, still trading just below $91 a barrel. Brent is also down for actually right now trading around $95 a barrel. But let's see how Europe and Asia are faring this morning. Ben Boulos is in London with the trade. Ben. Hello, good morning to you, more good. Yes, European equities really treading water, putting the pan-European stock 600 on track for roughly a 1% weekly drop. Investors really waiting for those all-important non-farm payroll figures due out later today on your side of the Atlantic. Crude oil prices have eased a touch, not enough though, to significantly lift European equities. Strongest sectors at the moment are tech, travel and leisure and car makers, but none of them even notching a 1% gain. This is the picture on the key regional benchmarks. As you can see, hardly deviating from the flatline there, the Italian market down underperforming its peers. Meanwhile, the picture in Asian equity markets, while the indices there rose on Friday as expectations

3:14of a near-term, fed rate increase, cooled off with some regional currencies also gaining ground. Now, Japan's Nikkei share average managed to snap what had been a four-session slide. It was driven higher by a 12% rally in index heavyweight soft bank group. Also a sharp fall in Japanese government bonds helped to give equities a boost. The 10-year JGB yield falling more than six basis points. The sort of fall in yields that I imagine the US Treasury would quite like to see at some point as well. More than it's back to you. I suspect you're right. Certainly policymakers and maybe consumers too would like to see that. Ben Boulos, thank you. Have a wonderful weekend. Let's get to this morning's top market story and the August jobs report. That's out in just a little over three hours from now. Economists expecting that US employers added 53,000 new jobs last month. That's after losing 23,000 back in July. Probabilities on CalChi painting a slightly weaker picture with just 46% expecting a number that is above 50,000. Unemployment rate meantime expected to hold study at 4.1%.

4:17And today's report is coming just about two weeks ahead of the next Federal Reserve interest rate decision. And odds of a holds are creeping up in the past 24 hours or so. With interest rate traders split down the middle between a hold and a 25 basis point hike users on CalChi, weaning more towards no policy change. That's something that was echoed by Fed Governor Chris Waller to Reuters yesterday. The short version is that while inflation remains meaning fully above the Federal open market committee's 2% goal, recent data suggests we are finally seeing some signs of disinflation. Now if this continues in the data over the next two weeks, I would be inclined to support holding the target for the Federal funds rate at its current setting. Joining me now at Dana Peterson, Chief Economist at the conference board Dana, it's great to have you on. I do want to get your reactions to Governor Waller's comments because

5:17similar to what we heard from Fed Chairwarsh last week in the sense that Labor market is not giving or does not seem to be giving some of these policy makers cause for concern right now. The real focus does seem to be on inflation. We're going to get CPI and PPI next week how to understand it. Yes, basically the Fed is faced with a conundrum. It's like if we don't see slower inflation readings, then we probably need to hike because that's what markets are expecting. But also we want to make sure that people maintain their confidence in us, the Fed, to ensure price stability. However, when we look at labor market indicators, the labor market seems to be fairly steady. Yes, payroll gains are pretty small and some of them are negative. But when you look at the level, most people are still working, the unemployment rate is low. And if it should tick up this week today when we see the numbers, it's likely to reflect the fact that labor force

6:19participation has fallen again. But overall, we're seeing that the labor market is fine, inflation measures are slowing. So perhaps a whole makes sense. Is the composition of the labor market changing? If you go under the hood, beyond the top line numbers for something like non-farm payroll, are we seeing, is that what we're seeing really the action in terms of where people are finding jobs, how people are finding jobs, and whether people are finding jobs? Yes, well let's start with Joltz. The data came out earlier, this week for July, and it still indicates that most people are not finding jobs. So companies are not really hiring, but they're also not firing. Meanwhile, many people are not quitting. And so you still have this low higher, low fire dynamic in the labor market. So looking forward to August payrolls, it's probably going to be the usual suspects underneath the headline, driving where the headline goes. And so certainly it's going to be tech, finance, transportation, warehousing,

7:27some of the big retailers are probably going to continue to cut jobs. Meanwhile, we're probably going to continue to see increases in employment in those areas that are suffering from labor shortages, like health care and hospitality and construction and even leisure. So given those things, we don't really know what kind of reading we're going to get. And usually August is a tough month of forecast, and historically August usually comes in lower than what markets or consensus expects. With that in mind, if we shift to the other piece of the Fed's dual mandate inflation, you've got diesel at record prices. We tend to talk a lot about gas prices because consumers see that most quickly and impacts spending patterns potentially. But diesel radiates out with much more faster impacts on broader inflation. So how are you factoring that into the picture here as we do look for some of these key readings coming into the fall? Indeed, diesel prices being elevated means

8:33higher consumer prices later because it feeds through the supply chain. And so this does factor into our own forecast. We'll re-anticipate that the oil price shocks from earlier this year and even the spikes over the summer will be through the supply chain and continue to keep commodity prices and then everything that depends upon commodity prices elevated through the end of this year and into next year. And so we still think there's going to be resistance to inflation cooling. But the good news is that shelter costs are coming down and consumers, I don't know if this good or bad news, so we are seeing consumers purchase less. And so we could start seeing that demand erosion, which would prompt many, which would prompt many companies to start cutting prices. And that would also help slow inflation. Dana Peterson, appreciate it. Thanks for kicking off the hour with me.

9:34We're going to hear more on the White House's take on the jobs report when National Economic Council Director Kevin Hasett joins Squawk on the street in a first on CMBC interview that kicks off at 9 a.m. Eastern. Well, me and Simon, we've got a lot more to come here on morning call, including share just SpaceX doing something for the first time in two months. First though, we've got big companies making big bets on Venezuelan crude. But how long before it makes a real impact on the economy? And you see it with your gas tank. And later, no mask, no problem for Tesla and its cyber cab rollout in Austin, Texas. Why regulators are keeping a close eye on that project, we've been very busy hours still ahead when morning call returns. Welcome back to morning call. Chevron, G. E. Vernova and Italy is announcing major oil and energy investments in Venezuela this week. That's following a separate deal struck by President Trump last week for the US to gain long-term access to a fifth of the country's oil reserves. In a note on Wednesday, Goldman Sachs saying it expects Venezuela's production to edge higher, but doesn't see output returning to

10:38pre-2018 levels above two million barrels per day for the next few years at a White House briefing yesterday. Vice President J. D. Vance defending the US deal, calling an example of smart foreign policy. It's very much a win-win thing. We're very proud of it. And I also just think that it gives supply stability in the energy market. I think if we've learned anything over the last six months, but importantly, if we've learned anything over the last 40 years, it's that these things, the supply of critical minerals and resources really matters. We had an administration for a very long time that under-invested in this stuff and now we're trying to change that and we're doing so quite successfully. Vance's comments coming after Energy Secretary Chris Wright spoke with CNBC from Venezuela on Wednesday, where he expressed confidence that these deals will have a positive impact on both countries. I think we'll be well over a million and a half barrels a day by the first half of next year. And Venezuela and production will be over two million barrels a day by the end of this decade. Well, joining me now is Henry Atatre's co-founder and director of

11:42economic policy at Veda Partners. And Pedro Barrelli, founder and CEO of B and V Advisors, a former board member, at Venezuela's state-owned oil company, Pettivista. Wonderful to have you both here. Pedro, I'm going to start this conversation with you. I do want to get your reactions to what we just heard from the Energy Secretary about the possibility of one and a half million barrels per day as soon as the first half of next year. I actually believe that we have to separate what Secretary Wright is talking about, which is the deal that he witnessed between Chevron and other companies. And the more grotesque deal that Vice President Vance is defending, that is basically almost for show. And if it's not for show, I think it's actually condemning the US's positive as well to even more derision and tension. So the two very separate deals. I think that nothing is going to change materially in supply. Keep in mind that when

12:46Ugechauer's came to power, Venezuela in 1999, Venezuela is producing 3.2 million barrels. And we had a plan to move to 6 million barrels, which was almost fully funded and fully structured. Two and a half million of those incremental barrels would come to the United States. So talking about security, that was security. It was negotiated, it was understood. It was even within a framework as something much more intelligent than anything that I've heard in the last month, which is energy security within the hemisphere, which the Clinton administration had been talking to from Canada to Argentina to all the energy producers in the region and saying, can we look at the energy supply and demand and wean ourselves off extra hemispheric oil? It's Ugechauer's who came in, destroyed that policy over the years. In front of everybody watching it, Venezuela became completely unreliable way before the sanctions. It became irrelevant.

13:48Not much of the Trump administration did in the first term. They actually added the sanctions, which even reduced the weight of Venezuela. So my sense is that this is the deal that Vance is defending, the deal that will you put together is a very, very sloppy deal that thing has more to do with covering up for what's happened in Iran and trying to sell to the electorate that the president has solved something. As you'll see in the next few days, the way they structure this deal is going to create problems in the U.S. and problems in Venezuela that are much bigger than what anybody anticipated. Okay. I want to take a little more into that with you from the operating side and what that's going to take. But first, Henry, let me bring you into the conversation, because I do want to get your reaction to that deal, which involves a 25% equity stake in North American Blue Energy Partners. This is a Venezuelan company. The stake being taken through the Office of Strategic Capital within the Pentagon. Certainly raising questions about legality

14:52constitutionality in Venezuela, but also as we look to midterm elections, a new composition of Congress at the end of this year, going to raise some questions about legality and validity and whether lawmakers will go forward with it here in the U.S. as well. Absolutely. This is the important questions, Morgan. And I'd say the market is proving Pedro's point here. As we see the crude is up 7% despite this announcement about a deal in Venezuela. The market is not buying what the president is selling here. And we're going to see that. And you continue to see it at the White House this week with the refiners who are trying to stay vigilant and stay in front of the president and say, hey, we are working at capacity. This deal with Venezuela is not going to change that. So on the Constitutionality front, and I think the key question is, what is Congress going to do about this? Is anybody going to ratify it to the point where you can anticipate that there would be an orderly, consistent policy from the United States from one administration to the next, let alone Venezuela's administration's into the future. And to that, I would say it's very telling

15:56that yesterday's speaker, Johnson or Republican from Louisiana, said that Congress is going to actually leave town. They canceled their last two weeks of session. So there's not going to be a cohesive strategy to codify this, to turn it into anything that the United States can bank on, or that markets and investors can sit back and say, hey, maybe crude has another option here. That's not what's being internalized by the markets. That's not what's being delivered by Congress. And so this is the administration acting alone in a space that is very inconsistent. We do not have the details, neither from Chevron or Exxon, about what's going to come next, let alone what's happening in Venezuela. So there's a long way to go here. Yeah, I mean, in terms of this deal that the US would be taking an equity stake in Pedro, I mean, North American Blue Energy Partners, they've gone from over the past, call it two years, tens of thousands of barrels per day in oil being extracted from Venezuela to hundreds of thousands of barrels per day. I realize that's still a very small baseline, and that's very different than millions of barrels per day.

16:58But they do have a track record there. So whether it's through that deal, or whether it's through deals with the likes of Chevron, how much oil can actually be brought online here, how quickly, and how meaningful is that when you have today, diesel at record highs, and we know this is the type of oil that goes into refining for some of these products that are going to matter ultimately to businesses and consumers. I don't think this is going to change anything in the supply and demand in the world or in the United States. I mean, Venezuela is producing 800,000 barrels, but I'm a little was extracted. It's producing 1.1 million barrels. That's the total increment. Even as well, I get to two million barrels in four years, that's a lot. That increment is not really going to change anything in a market, an oil market of 110 million barrels a day. So my sense is that an administration that completely miscalculated did not understand the risk or the the weakness of

18:01the choke point of the straight of hormones is now trying to create a show, but they're doing it in an incredible way by investing in a company of the poster boy of corruption in Venezuela. I mean Mr. Betancourt is literally, I mean, his money, the money that he has invested in this business, and now the Pentagon is going to take 35% off. He made out of corrupt deals where he overcharged the best one government, $3 billion for a whole bunch of emergency electrical plans that produce nothing and none of them are functioning right now. The United States picking Betancourt, asked their partner for such a crazy deal, such a unique deal of inserting yourself directly in ownership, in equity, Venezuela. It's almost equivalent of picking Betancourt of, I don't know, putting Jeffrey Epstein as Secretary of Education, I mean, it's bizarre.

19:03Henrietta, we're going to do double duty with you, but just very quickly here. Do you want to get your final thoughts on this topic specifically with energy prices, such a big part of the focus for midterm elections? You know, the real struggle is that we've been concerned about prices and affordability all year, but since the war with the Ron started, what has catapulted to the top of the concern of American nationwide independence, Republicans, Democrats, is gas prices. And they can just easily see that diesel is reaching record rates, and gas has been over $4 a gallon for half of the year. It's the duration of this pain that's really jarring and a problem for the electorate, because at the beginning of the war, they were paying $400 more annually for gas. Now it's $700. You can see it in the credit card data. American voters are very anxious about the duration of this war, because gas at $4 means you're spending $120 just to fill up the tank of the most popular truck in America. That's a real problem, and that's what voters are taking

20:05with them to the polls this year, and why you see Democrats leading on the generic ballot. It's a problem specifically with the war, with energy prices, with the lack of a deal on affordability. So that's the focal point, and why we should be anxious as investor communities felt, what might come next from the White House to combat this message? Is it an export control ban? Congress left town, as I said, so there's no way to produce the gas tax, for example, and provide real relief for consumers. That's what keeps me on alert right now, going in November 3rd. Okay. Pedro, thank you. Henrietta, we will see you again a little bit later when you join the call crew. Straight ahead, another rough quarter for Lulu Lemnitz, new CEO, shares are sinking ahead of the open. But first, let's also check on shares of SpaceX after closing up more than 6% yesterday. The company's market cap is now back above $2 trillion first time in nearly two months. You can see up another half a percent this morning trading right around $150.48 a share. So testing that key level that we've been talking about in recent weeks when it comes to SpaceX.

21:09We'll be right back. Welcome back to morning call. We're getting a check on some this morning's big stock movers. Lulu Lemnitz, tumbling after a second quarter revenue, and seems to restails missed forecast, company cut its full your guidance for the second straight quarter as well. And by the way, expectations very low going into this report. The retailer saw a quote greater than expected slowdown in some of its core categories, including leggings, and says, quote, negative commentary on social media also affected performance. The results coming a week before new CEO Heidi O'Neill takes the top job. You can see those shares are down almost 19% right now pre-market. And shares of DocuSign, those are higher after reporting second quarter earnings and revenue that topped estimates. The digital document signing platform also raising its annual sales outlook for the second time this year, citing a boost from AI-related demand. Those shares are up about half a percent. Z-scaler meantime reporting a narrower fourth quarter loss revenue top estimates and the company is raising its guidance for the year as AI helps drive demand for its cybersecurity products. Z-scaler also plans to restructure and cut 3% of

22:09its workforce as it shifts resources to support its growth and AI initiatives. Those shares, though, down 4%. Keep in mind, we've had a big run up in cybersecurity stocks in the last couple weeks. Z-scaler CEO will have much more on the quarter in the state of the industry and a first on CNBC interview that kicks off just after 10 a.m. Eastern. Still on deck here, an IPO pipeline health check, a little bit of pun intended. The latest company getting set to bring the opening bell at the NASDAQ with its public market debut with a little help from Robinhood. Morning Call. We'll be right back. I'm Morgan Brennan. Welcome back to Morning Call. Let's get a check on U.S. stock futures after Wall Street's best day in a month with all the major averages finishing up more than 1% yesterday. You can see it's a mixed picture here this morning. S&P has poised open down about four or five points, Dow down 53 points, and the NASDAQ up 85 points. We are on pace as of right now for a winning week in large part because of the rebound we saw in the major averages yesterday. The Russell 2000 is the exception there. But yield shock continues to be in focus and perhaps the

23:15way we should frame this morning is stabilization. So you can see right here we take a check on treasury yields the Fed sensitive two year treasury yielding 4.33 percent. We can continue to see that climb this week. But we're seeing a breather at the long run of the curve. So 10 year treasury is 4.75 percent right now 30 year treasury 5.23 percent. Speaking to our colleagues in Europe this morning though Aliens is Muhammad Al-Aryan telling investors that they should expect the sell off of the global government bonds to continue. I don't see any appetite in the U.S. for immediate fiscal consolidation. So I suspect we will continue to see upward pressures on yield. All right well if we take a look at the dollar index as well a little stronger here this morning dollar index levels 90 910 speaking of currencies we've seen some volatility in FX this week particularly in Japan. So let's get a check on what we've seen in the end after a big spike in the end earlier

24:15this week giving back a little of yesterday's move here but we're still having around 156 per dollar about 2.4 percent stronger week on week for the end that's probably the best performance for the end weekly performance for the end in about a month and a half. Let's take a look at the energy trade and what we're seeing across that complex right now WTI is on pace for its best week since mid July taken a bit of a breather here this morning down about half a percent back below 91 dollars a barrel. Brent crude is down fractionally right now trading around 95 dollars a barrel. We're also watching the price of diesel because that has hit an all time high according to triple A. National gallon national average for a gallon is now sitting at $5.85 that surpasses the previous high that was hit back in 2022. Let's get a check on global markets as well mostly positive finish to trading in Asia and NICAN cost be leading the gains there and if we get a check on early trade in Europe you could see fractional losses this morning we're essentially flat for many of the major averages across the world for the week in this final week of summer but if we

25:19check on some of the morning's latest headlines Tesla unveiling its two seat cyber cab at an events in Austin, Austin, Texas yesterday offering a new look at the self-driving vehicle CEO Elon Musk has said that it's key to the company's future autonomous driving and these tax robot taxis also announcing rides in quote limited areas of Austin as safety regulators continue to evaluate this car which has no pedals no steering wheel no light art technology Elon Musk was not at the event Tesla shares though have been on a tear in recent weeks closing up more than 5 percent yesterday of nearly 15 percent over the past month but as you can see right there on your screen down a bit this morning about 2.5 percent lower pre-mork market. Me and time Adobe naming a new CEO to succeed a long-time chief Shantanu Nareian that's after 18 years at the helm the new CEO is an MIT graduate who joined Adobe back in 2020 to lead its digital experience business he takes the top job starting December 1st shares of Adobe are lower

26:24as well pre-market but health and fitness ring maker aura filing for its initial public offering and in its filing the company reported a net loss of 924 million dollars on 1.2 billion in sales in the nine months ending June 30th the filing did not disclose the amount of money aura intense to raise but it does plan to list on the NASDAQ under the ticker OURA with 18 underwriting firms including Robin Hood well just one day after opening eyes asteris entered the AGI era that's according to the company huge headline there and through a big reportedly in the final stages of expanding its revolving credit facility to 15 billion dollars ahead of its highly anticipated IPO with Morgan Stanley leading the deal expectations as we could get a perspective as soon as next week the company is looking to raise as much as SpaceX or more when it goes public and speaking of AI checking out the most popular AI platforms by token volume this week

27:27as tracked by open router a site that allows access to different models users on prediction market CalShi have 10 cents on top that's followed by open AI and deep seek in other words in terms of token usage two of the top three names are Chinese companies and treasury secretary Scott Bessent says the EU has formally joined operation economic outcast sanctioning Iran and isolating it from the global financial system well let's turn to commodities and the price of gold it's fighting to close out the week in the green down fractionally right now if it's able to do so though that would be its sixth positive week in the last seven a rebound has been taking shape in the precious metal up almost 9.5 percent in the last two months still more than $1,000 away from its record high of over 50 at 600 dollars and ounce that was hit earlier this year one company riding the renewed enthusiasm those alamos gold the stock is up nearly 20 percent over the past two months and as you can see right there you're on your screen up another almost half a percent right now pre-market so

28:30for more let's bring in John McCluskey the company's CEO and founder john it's great to have you on the show and that's really where I want to start with you this rebound we have seen in gold how much of this is tied to other markets like treasuries treasuries yields and the dollar how much of this is something different I think you're asking a question you know the answer to they're all very closely tied together and you know the the goings on these days in the in the bond market what's going on with the dollar and the the concern around you know this 40 trillion dollar threshold in the US that that that is all playing a direct role in what's going on with gold it's interesting we talk a lot about the renewal of this D dollarization trade this debatement trade unclear whether actually seeing it play out in financial markets but when it comes to the physical market for gold when you get reports of bullion being transferred to you know places like the UK on the behalf of

29:34other european central banks and governments when you hear about stockpiling in places like China how much is this happening right now I think that all plays to the the question of uncertainty you know is is the market is the market confident in what's going on in in the US right now and you know what what are those governments what are governments like Germany and and the Netherlands and France and so forth what what are they indicating to the market when they transfer their physical bullion out of New York and bring it back to London at the very least it's a it's a symbolic message that the that those countries are less confident in in holding their golden New York regardless of what they say you know they'll move it and they'll say no you know we're just we're we're just you know these are normal treasury operations for us and maybe so but I think the indication to the market

30:40is that they're somewhat losing confidence in storing their gold in the US and that has a very strong effect on on market thinking what does it mean for alamos gold and your ability and your process to pull the metal out of the grounds and meet the demands in the marketplace higher gold prices ultimately mean higher-prosome profits for alamos gold that's that's that's pretty easy to figure out but you know what we're we're on a very strong growth trajectory as a company and that's part of the reason why we've been doing very well in the market over the last number of years we've had tremendous exploration success in our Canadian operations and you know we've we've never had higher reserves and we have have today despite the fact that that we've been increasing production as well so our exploration success has gone a long long

31:41way to backing the underpinning the growth that's going on in alamos right now and particularly with the developments at our island gold project and we're going to see production double at island gold over the next few years as we complete a billion dollar investment in in in a shaft and we transform that operation from a a ramped urban operation to a shaft of an operation it's a it's quite an exciting development the company it brings down costs and it raises gold production so we're going to see our production ultimately go from current level around 500,000 ounces a year we're going to see them grow to about a million ounces a year as those minds take hold in light of that I find myself having these conversations with miners in copper and other types of metals and materials as well but the fact that you do operate in what would be considered a more geopolitically stable place like Canada right now how much does that drive a demand premium

32:42for what you're doing well I think it really does you know the world you know investors are not comfortable with geopolitical risk in the world right now the world's becoming a more dangerous place and as that happens in countries like Canada the United States Australia and so on those jurisdictions command a premium in the market you know Canada's our home base for a Toronto based company we took a decision about 12 years ago we we were operating in Mexico we we had operating mines in Mexico but we took a decision then that you know Canada was a great place to to be exploring there was lots of opportunity here and we made some acquisitions and then off the back of those we had some tremendous exploration success we followed that up by by building bigger and better mines and so by now we're we've raised our production from roughly 150,000

33:49ounces a year where we were about 10 years ago or at 500,000 ounces a year now and and we're on a way to a million and we've done that off the back of investing heavily in in Canada. Okay John McCluskey great to have you on CEO of Alamos Gold as we had to break let's get a check on shares of planet labs because those are jumping on the back of earnings big Q2 beats that's some softer guidance this is tied to a pull forward of a satellite related delivery shares are spiking 10% and nonetheless and seeing a lot more demand and that's showing up in the revenue mix for defense related business for this company as well we'll be back after this. Let's get a market market flash on credit reporting agencies under pressure after the director of the federal housing Bill Pulti said yesterday that he's directed Fannie Mae and Freddie Mac to approve all lenders to use credit scoring system vantage score adding quote FICO has enjoyed a monopoly and more in a separate post Pulti said credit reporting agencies Equifax Experian and

34:54TransUnion have been overcharging Americans for quote far too long all of these names that are publicly traded are under pressure this morning straight ahead the morning call crew team up the trading day ahead why one member says today's jobs report may put more pressure on upcoming inflation reports. It's time for your call sheet where we look at the topic striving the trading day ahead crew members today Victoria Green of G-Square Private Wellth also CNBC contributor Thomas Martin of Global Alton Investments and Henrietta Trays of Veta Partners is back with us as well all right let's kick this off with the big economic news of the day that is the jobs report Vicki I'll start this with you what are you watching for it how much of this could potentially be a market mover or not oh I think it's a huge market we were expecting to add about 55,000 jobs Jolt was in line ADP a little bit light honestly you're hoping for a little bit of a miss here not a terrible miss but a light job report would allow them to get a little bit more concerned and a little less pressure on the inflation report next week I think next Friday CPI is the event

35:59here in September because if that comes in hot at all everybody's indicated that's what they're looking for if they're going to do a September hike and right now odds across the board you look at polymarket Kyle she fed fund features it's a 50 50 coin flip so we kind of hope jobs are a little bit light today because maybe the Fed has to pay attention to the the employment side and not just hyper focused on inflation next week yeah I mean a lot a lot of messaging whether it's fed share worse last week whether it was Waller Chris Waller governor Waller yesterday signaling that inflation is really where the Fed is focused now Thomas and in terms of that you've seen a Fed funds futures that's run up to 70% now it's come back down to about 50% odds of a hike in September of you know how's an investor to navigate all of it what are the key inputs to watch record diesel prices is that going to be one of them now well sure so when you're at 50% coin flip for whether or not the Fed's going to raise and you actually have a governor saying we're going to pay attention to one report whereas the Fed usually says that you know no one report makes a

37:02difference you have a lot of uncertainty in the market and it just means that somebody's going to be disappointed at least half the people are going to be disappointed unless things change there is a low bar for raising rates you know if the economy is not weak based on the employment report and if inflation is a little bit hot that's going to kind of move the the button towards a potential hike Henrietta one of the other things that I think isn't necessarily factoring into this but maybe should is the optics the optics of being political for the Fed I would imagine that the bar is actually higher for the Fed to make a move in any direction ahead of the midterm elections absolutely I was going to say wars is working on borrowed time here the elections are November 3rd and your options are to hike in September or October or both I think it is a huge political obviously risk the higher president Trump and the issue of course for both wars and the president is that the inflation rates are so high because of the one two punch of the Iran war that is shut down

38:08the street and had that flow through as you mentioned to diesel prices that are inputs to 6,000 different product lines so if the Fed is looking at what to do on inflation it sees the war is not ending the straight remains closed Russia and Ukraine continue to expand the drones are hitting refineries meanwhile our refineries are operating at 98 percent capacity or above you don't have the option of taking the war lightly with 6,000 different inputs you've got to pay attention to it acknowledge it and of course there's really nothing the Fed can do to offset higher commodity prices on either gas or diesel or jet fuel so it's a catch 22 but on the timing front I have to say I would rather do September than October if I was the president and Worsh. Vicki I mean the other piece of this of course is that we're just it's been a gangbusters earnings season that's expected to continue here for S&P 500 companies at least but when you talk about the economic growth story it's also not just a U.S. one globally things have largely managed

39:11to hang in there which perhaps is part of the reason we have seen this run up in rates globally. Yeah I think everybody's saying look it's not that bad right we're facing all of these headwinds we're facing high oil prices we're placing deal with a geopolitical uncertainty but the markets keep going on we are seeing growth a lot of that's being driven by the buildout in AI the excitement and the infrastructure needed there of the technological innovation the amount of money being poured in and CapEx being spent that's a huge stimulus to any economy so we are still moderately bullish obviously September's typically not the best month in the world but we look around as they earnings are great economically we're still growing even despite these headwinds which is a major feat considering record diesel prices you know the amount of uncertainty very very fraught upcoming election a lot of investors get worried and I keep telling them politics matters much less to the market than they do to your port the to the portfolio to the markets than they do to you personally so make sure you take a step back as we're hitting election season and saying hey look look at the data look at the facts make sure you take your personal beliefs out

40:13of how you're building your portfolio because it can get a little bit dangerous trying to pay politics with money and of course we're in a seasonally historically seasonally week time of the year Thomas but we we've had tech earnings this week we've had some consumer earnings this week it's been largely a mixed bag and then from a macro standpoint you have had volatility even if it's not in the US stock market in other markets like FX with a yen yeah I think the most important thing to focus on is sentiment right now and it's been a sentiment driven market all year really with AI and the movement in stocks and then most recently with the movement in bonds and right now bond sentiment is low everybody thinks that interest rates are going to continue to go higher and they certainly have sentiment on stocks is remains very high so despite rises in oil prices and potentially an inflation and in yields stocks are holding up in the seasonally week period you know high

41:14sentiment or low sentiment at extreme doesn't necessarily mean it can't be maintained for a while so it's not a good thing to bet for or against but it does tell you something about where investors are positioned and where the risk is okay I mean bond cell of has been the big story overall this week Henrietta and part of that story has been fiscal imbalances or at least here in the US we have lawmakers kicking the can with a continued resolution at least until after the election here so is there is there a world in which this actually gets addressed not anytime soon no I think what you're looking for if you're an investor do you want to you project out into the future you want the president to be from one party and the House and the Senate to be from another that is the situation that requires mandatory bipartisanship creates pressure on whoever the sitting president is and the House and Senate members and that bipartisan divide is going to be what's essential for any any package to address our fiscal situation but I would say that's a 2020 story at the earliest

42:17okay well thank you so much to our morning call crew great to have you all here have a wonderful weekend