Stock Rally Fades on Higher Oil Prices; SpaceX in Talks to Buy Nvidia Chips

VONNIE: 5:00 IN NEW YORK CITY, 10:00 IN LONDON. I AM VONNIE QUINN WITH YOUR BLOOMBERG BRIEF. THE STOCK RALLY STALLS AFTER THE S&P 500 HITS ANOTHER RECORD. INVESTORS TURNING TO TODAY'S FED MINUTES. OIL HIGHER ONCE AGAIN AS TRADERS WEIGH INCREASED FLOWS THROUGH THE STRAIT OF HORMUZ AGAINST A PICKUP IN IRANIAN UP TO VESSELS. SPACEX SAID TO BE IN TALKS TO RAISE $40 BILLION TO BUY NVIDIA CHIPS AND WHAT WOULD BE ONE OF THE BIGGEST EVER DEBT FINANCINGS FOR THE AI BUILDOUT. LET'S GET A CHECK ON MARKETS AROUND THE WORLD. WE BEGIN IN ASIA AND WINNIE HSU HAS THE LATEST THERE. WINNIE: GOOD MORNING. WE ARE SEEING ASIAN STOCKS UNDER PRESSURE TODAY GIVEN THE ELEVATED OIL PRICES AND A SLIGHTLY STRONGER U.S. DOLLAR. WE ARE SEEING THE KOSPI INDEX LEADING DECLINES TODAY, DOWN 2% AHEAD OF SAMSUNG PRELIMINARY EARNINGS TOMORROW. WE ALSO HEARD FROM THE CENTRAL BANK IN INDIA THAT IS A OF -- THAT THEY HAVE RAISED RATES THE FIRST TIME IN FOUR YEARS AND THAT IS WIDELY EXPECTED BUT THEY ARE LEAVING IT OPEN GOING FORWARD FOR FURTHER RATE HIKES. DECLINES TO ABOUT 1%. WE ARE SEEING A SWITCHING HANDS OF THE TOP PERFORMING SO FAR THIS YEAR WITH TAIWAN OVERTAKING SOUTH KOREA. THE BENCHMARK UP 72% THIS YEAR AS INVESTORS ROTATE AWAY FROM KOREA, AWAY FROM THE MEMORY TRAIT AND OTHER OPPORTUNITIES ON THE AI TRADE. VONNIE: THANK YOU. IT IS ONE OF THE AREAS THAT IS FROTHY ACCORDING TO BANK OF AMERICA STRATEGISTS. LET'S LOOK AT EUROPE. WE ARE SEEING DECLINES TODAY ACROSS THE BOARD GEOGRAPHICALLY. SECTOR WISE MOST SECTORS ARE IN THE RED WHEN IT COMES TO THE STOXX 600. ENERGY IN THE GREEN THANKS TO THE BIG SWING IN OIL PRICES WE HAVE HAD OF THE LAST 24 HOURS AND AREAS LIKE RETAIL DOING WELL IN EUROPE. NOT SO HOT OF A PICTURE FOR FRANCE. WE HAVE THE 10 YEAR YIELD. PRESSURE ON BONDS TODAY IN FRANCE. THAT ALSO HAS THE EURO LOWER. WE ARE ON THE CUSP OF DIPPING BELOW 1.12 NOW. OIL BACK ABOVE 101 DOLLARS A BARREL ON BRENT. THIS AFTER DIPPING BELOW $97 A BARREL YESTERDAY. THE MARKET VERY TOUCHY AT THIS POINT. UP TWO THIRDS OF 1% IN THIS SESSION. NOT QUITE THE SAME FOR WTI BUT WE ARE STILL HIGHER. A DESPERATE PICTURE FOR EUROPEAN GAS FUTURES. ABOVE 76 EUROS PER MEGAWATT HOUR. THE PICTURE IS NOT SHOWING ANY RELIEF IN EUROPE AS INVENTORIES ARE REALLY LOW GOING INTO HEATING SEASON. THIS IS A LOOK AT YOUR U.S. PICTURE AFTER HITTING A RECORD. THE S&P 500 MIGHT BE TAKING A BREAK. NASDAQ FUTURES DOWN FRACTIONALLY, THE SAME WITH THE RUSSELL 2000. LET'S LOOK AT BOND YIELDS. WE DID SEE RESPITE YESTERDAY BUT WE ARE BACK UP TODAY, PARTICULARLY IN THE BELLY. DECENT APPETITE FOR THE THREE YEAR NOTE YESTERDAY. WE WILL SEE WHAT HAPPENS TODAY WITH THE 10 YEAR AUCTION AND TOMORROW THE 30 YEAR AUCTION. LET'S GET TO PREMARKET MOVERS WITH JUSTINA LEE. JUSTINA: ONE STOP TO WATCH IS SPACE-X AFTER REPORTS IT IS SET TO BORROW $40 BILLION TO BUY NVIDIA CHIPS IN WHAT COULD BE THE BIGGEST DEBT FINANCING IN THE AI BOOM SO FAR. NEXT UP ANOTHER ELON MUSK RELATED NAME. INTEL HAS TALKED ABOUT HOW THEY ARE STILL WORKING WITH ELON'S EMPIRE TO SUPPLY THE SEMICONDUCTOR CHIPS. INTEL IS UP TODAY. THAT AFTER ELON MUSK CLARIFIED TSMC IS NOT PART OF THE EFFORT. EUROPEAN CARMAKERS GETTING A BOOST AFTER BLOOMBERG NEWS REPORTED THE EU IS CONSIDERING SAFEGUARD MEASURES TO LIMIT IMPORTS OF CHINESE HYBRIDS INTO THE EU AFTER HYBRID VEHICLE IMPORTS SURGED. WE CAN SEE STELLANTIS UP PRETTY STRONGLY IN EUROPE TODAY. VONNIE: THANK YOU SO MUCH. ALSO COMING UP THIS HOUR, KEVIN MAHN. LET'S TAKE THINGS OFF WITH A STOCKS RALLY POTENTIALLY EASING. JOINING US IS BLOOMBERG'S VEN RAM. SAYING THESE ARE CLASSIC BUBBLE SIGNS, NOT MUCH BREATH TO THIS MARKET. BEFORE THE BUBBLE POPS, IF YOU HAVE FOMO THERE ARE WAYS TO PLAY THIS. IS THAT ACROSS THE BOARD, EVERYONE ACKNOWLEDGING SOMETHING WILL POP AT SOME POINT? VEN: I THINK THAT IS A FAIR STATEMENT. THE EXUBERANCE OF INVESTORS KNOWS NO BOUNDS. A FAIR BIT OF THE OPTIMISM COMES FROM THE PREMISE THAT THE ECONOMY IS GOING TO BE GROWING SO WELL, WELL ABOVE TRADE. THEN YOU HAVE THE AI LED PRODUCTIVITY GROWTH AND EARNINGS GROWTH WILL BE WAY ABOVE WHERE THE FED FUNDS RATE IS FOR THE 10 YEAR RATE. THEREFORE I THINK THE IDEA BEING EQUITIES CAN KEEP RALLYING. I THINK THEY WILL BE SUPPORTED. I THINK THE THEIR VALUE ON THE NASDAQ 100 IS AROUND 30,000 WHICH IS ALREADY PUBLISHED ON THE TERMINAL MONTHS AGO. WHAT INVESTORS ARE TRYING TO DO IS FRONT RUN THE GAINS THAT WILL ACCRUE NEXT YEAR ALREADY. I THINK STOCKS ARE GOING TO BE BUOYANT FOR THE TIME BEING BECAUSE THERE IS NO CREEK THE BUBBLE AS IT WERE. VONNIE: THE S&P 500 UP 2% ALREADY THIS MONTH ONLY A FEW DAYS INTO OCTOBER. I WILL ASK YOU ABOUT THE FED MINUTES. HOW DATED ARE THEY THAT WE HAVE REFRESHED PCE DATA AND THE COOLER JOBS REPORT? VEN: THERE IS MUCH MORE THAT HAS ALREADY FLOWN UNDER THE BRIDGE SINCE THE MEETING. THE CHANGE IN PCE METHODOLOGY MEANS INFLATION IS A LOT SOFTER THAN WHAT FIT OFFICIALS WERE KEEPING IN MIND WHEN THEY WENT INTO THE PREVIOUS HODDLE. THE FACT THAT WE GOT A WEEK JOBS REPORT AND A HIGHER UNEMPLOYMENT RATE, IT BUYS THEM TIME. I DO NOT THINK THEY WILL BE LOOKING AT AN OCTOBER RATE HIKE EVEN IF THE MINUTES SUGGEST OTHERWISE. I THINK THE FED MINUTES ARE PRETTY MUCH DEAD ON ARRIVAL. VONNIE: WE WILL BE COMING THROUGH THEM EITHER WAY TO SEE IF THERE ANY NUGGETS WE CAN GATHER. THAT IS BLOOMBERG'S VEN RAM. OIL REPORT ARE SEEING REPORTS OF INCREASING ATTACKS ON IRAN IN THE STRAIT OF HORMUZ. MARCO RUBIO SAYS OIL SHIPMENTS THROUGH HORMUZ ARE APPROACHING PREWAR LEVELS. WHAT IS THE STATE OF AFFAIRS? I THOUGHT WE'VE BEEN WAITING ON YVONNE MAN -- ON AN IRAN-OMAN AGREEMENT AND OUT SEEMS LIKE ATTACKS ARE PICKING UP AGAIN? >> WE HAVE BEEN WAITING FOR AN AGREEMENT BETWEEN OMAN AND IRAN BUT THAT NEVER MATERIALIZED. WHATEVER DEAL THEY HAD COME UP WITH OR WERE CLOSE TO COMING UP WITH WAS NOT SOMETHING THAT OTHER GULF ARAB STATES WERE HAPPY WITH AND ULTIMATELY THE U.S., BECAUSE IT WAS AN AGREEMENT THAT WAS GOING TO FORMALIZE IRAN'S CONTROL OVER MARITIME TRAFFIC GOING THROUGH THE STRAIT OF HORMUZ. WE HAVE ALMOST MOVED INTO A DIFFERENT PHASE. THE U.S. IS VERY FOCUSED ON THIS BLOCKADE, THIS NAVAL BLOCKADE ON IRAN SPORTS AND LATE -- ON IRAN'S PORTS AND TIGHTENING SANCTIONS. THERE IS NO DOUBT THOSE ARE HURTING THE IRANIAN ECONOMY A LOT. INFLATION THERE IS ALMOST 90%. YOU HAVE THE CURRENCY WEAKENING HEAVILY AND RAPIDLY ON THE BLACK MARKET. YOU HAVE SOME SHORTAGES OF GOODS. THE U.S. IS HOPING THIS IS ENOUGH TO FORCE IRAN TO RESTART PEACE TALKS. THERE IS LITTLE SIGN THOUGH OF THAT. WE ARE SEEING THE OPPOSITE IN RECENT DAYS WITH IRAN RAMPING UP ATTACKS ON SHIPS IN THE STRAIT OF HORMUZ AND THAT COULD BE A TACTIC BY IRAN TO PUT PRESSURE BACK ON WASHINGTON IN THE FORM OF HIGHER ENERGY PRICES. FOR ALL THE PRESSURE IRAN IS UNDER FROM THE U.S. IT IS STILL ABLE TO CAUSE QUITE A BIT OF PAIN TO THE ENERGY AND THE SHIPPING WORLDS. VONNIE: ON THE SAUDI ARABIA-HOUTHI CONFLICT TRUMP HAS BEEN RESISTING A DEEPER U.S. ROLE. HOW PROTRACTED COULD THE REGIONAL WAR GET? PAUL: THAT IS ANOTHER FRONT, THE FRONT IN YEMEN IS ANOTHER PROBLEM FOR THE U.S. THE SAUDI LED COALITION MAKE IT UP OF YEMENI GROUND FORCES AND SAUDI AIRPOWER HAS STARTED A COUNTEROFFENSIVE AGAINST THE HOUTHIS SUNDAY AND THEY HAVE MADE GAINS AND RETAKEN TERRITORY FROM THE HOUTHIS INCLUDING A RED SEAPORT. BUT THEY SET THEMSELVES A VERY AMBITIOUS TARGET. THEY WANT TO ELIMINATE THE HOUTHIS. IF THEY ARE INTENT ON DOING THAT IT WILL BE VERY DIFFICULT. THE HOUTHIS HAVE BEEN IN POWER IN THEIR PARTS OF YMEMEN FOR MORE THAN A DECADE AND WITHSTOOD BOMBING CAMPAIGNS. THEY ARE STILL STANDING. IT MAY BE THAT THE SAUDI'S GROUND FORCES WANT TO RETAKE A LOT OF TERRITORY AND REDUCE THE AMOUNT OF LAND THE HOUTHIS HOLD. MAYBE SQUEEZE THEM INTO A SMALL POCKET IN YEMEN. EVEN THAT WOULD BE DIFFICULT BECAUSE THE WHO THESE ARE BATTLE HARDENED AND HAVE WITHSTOOD A LOT. ALL THE WHILE THEY ARE FIRING DRONES AND MISSILES AT SAUDI ARABIA, WHICH IS A BIG PROBLEM FOR THE SAUDIS. VONNIE: THANK YOU SO MUCH FOR BRINGING US UP TO SPEED THIS MORNING. NOW TURNING TO THE AI RACE. SPACE-X SAID TO BE IN TALKS TO RAISE $40 BILLION TO BUY CHIPS FROM NVIDIA. PIMCO AND APOLLO ARE SAID TO BE INVOLVED IN THE DEAL. JOINING US IS BLOOMBERG'S NEIL CAMPLING. WHY DO THEY NEED MORE FINANCING? THEY JUST WENT PUBLIC. NEIL: I THINK THEY ARE RAISING FINANCING BECAUSE THEY CAN AND BY THAT I MEAN THERE'S A LOT OF APPETITE IN TERMS OF SOFTBANK HAS TAPPED THE MARKETS. AMD, THE BROADCOM DEAL TO TAP THE MARKETS. DON'T FORGET SPACE-X SAID THEY HAVE A TOTAL ADDRESSABLE MARKET OF $28 TRILLION. MOST OF THAT IS FOR AI. TO THE FAIRPOINT, IF YOU LOOK AT THE BALANCE SHEET, THEY HAVE $100 BILLION IN CASH ON THE BALANCE SHEET. $60 BILLION OF NET CASH ON THE BALANCE SHEET. THE FUNDING IS NECESSARY AT THIS STAGE IN TIME, WHATEVER THE CASH LOOKS LIKE IN THE FUTURE. I THINK IT IS BECAUSE THERE IS APPETITE ACROSS ASSET IN THE MARKET FOR AI RELATED DEBT STOCK. THAT IS WHY THIS TALK IS GETTING ATTENTION THIS MORNING. VONNIE: WILL PIMCO AND APOLLO GET GREAT TERMS ON THIS OR THERE IS SO MUCH APPETITE THAT SPACE-X IS CALLING THE SHOTS? NEIL: IT IS ONE TO KEEP AN ION. -- TO KEEP AN EYE ON. WE SAW SOFTBANK TAPPING INTO THE JUNK-BONDS AND ENDED UP PAYING A HIGH COUPON FOR THE DEBT. DEFINITELY INTERESTED TO SEE HOW THE STRUCTURE TAKES PLACE OVER THE COURSE OF THE NEXT FEW DAYS AND WEEKS. JUST NEED TO GET A SENSE OF WHERE THE APPETITE IS AND ALSO WHAT KIND OF TERMS CAN BE EXTRACTED. THAT IS ONE ELEMENT TO KEEP AN EYE OUT FOR SURE. VONNIE: THANKS SO MUCH. TWO OTHER TOP STORIES THIS MORNING. BILLIONAIRE INVESTOR RAY DALIO WARNING AI IS A CLASSIC BUBBLE THAT WILL BURST SOON. SPEAKING OF THE FORBES GLOBAL CEO CONFERENCE, RAY DALIO POINTED TO RISING INTEREST RATES AND THE NEED TO TURN WEALTH INTO CASH AS THE REASONS FOR THE BUBBLE TO POP. THE FINANCIAL TIMES REPORTING HSBC IS LIMITING HALF OF ITS MANAGEMENT AND SPECIALIST POSITIONS ACROSS ITS U.K. WEALTH DIVISION AND REDUCING FINANCIAL ADVISORS BY 70%. SOURCES TELL THE FINANCIAL TIMES THIS IS PART OF A PLAN TO USE AI TO SERVE AFFLUENT CLIENTS MORE EFFICIENTLY. PORSCHE IS PLANNING TO INCREASE PRICES FOR ITS TOP END SPORTS CARS BY 10%. OUTLINING A PLAN TO SELL FEWER HIGHER END CARS TO TRY TO DRIVE RETURNS. THIS AFTER A PUSH INTO ELECTRIC CARS AND PLUNGING SALES IN CHINA HURT THE COMPANY. COMING UP, OUR EXCLUSIVE CONVERSATION WITH APOLLO PRESIDENT JIM SELTZER -- JIM Z ELTER ON HIS OUTLOOK ON INFLATION IN THE U.S.. THIS IS BLOOMBERG. ♪ FRANCINE: APOLLO PRESIDENT JIM SELTZER DISCUSSES HIS OUTLOOK ON INFLATION. >> PEOPLE ARE WRINGING THEIR HANDS ABOUT THE RISING IN RATES. IT HAS HAPPENED BECAUSE WE HAVE A GREAT ECONOMIC CYCLE NOW. THE REST OF THE WORLD WOULD LOVE TO HAVE THE GROWTH IN CAPEX. WE HAVE A RISK ON MENTALITY, A MENTALITY OF PRIVATE CAPITAL AND PRIVATE ENTERPRISE GROWN COMPANIES. INFLATION HAS BEEN A LITTLE HIGHER BUT NOT OUT OF CONTROL ANY MEANS AND SO AS A CREDIT INVESTOR FOR A LARGE PORTION OF OUR PORTFOLIO THIS IS THE ENVIRONMENT YOU WANT TO BE IN. YOU WANT TO BE IN A PRO ECONOMIC GROWTH ENVIRONMENT, BIG CAPEX CYCLE, POSITIVE MNA FROM THE ADMINISTRATION, A RISK ON APPETITE, AND FINANCIAL PERFORMANCE IS STRONG SO WE LOVE THE U.S.. THAT IS OUR HOME. THAT IS WHERE THE MAJORITY OF OUR ASSETS ARE TODAY BUT CERTAINLY THERE ARE OTHER PLACES BUT THE U.S. IS A PRIMARY MARKET FOR US. FRANCINE: IS THERE ANYTHING THAT LOOKS CROWDED? WE SAW AI INFRASTRUCTURE SPENDING IN THE LAST 12 MONTHS. >> THERE IS A NARRATIVE THE GLOBAL RENAISSANCE IS AI AND TECH ONLY AND I THINK WE WOULD SAY WHILE IT HAS TAKEN A LOT OF AIR IN THE ROOM AND IT HAS BEEN A TARGET OF FINANCING AND FOCUS BECAUSE OF THE SHEER SIZE, OR THE MACULA'S DEFENSE, ENERGY SUPPLY, ENERGY TRANSMISSION, THOSE ARE ACTIVE. I SUSPECT HOW WE FUND AND FINANCE THE DEFENSE BUDGET GOING FORWARD, I THINK THERE WILL BE ACQUISITION PROGRAMS AND SUPPLY PROGRAMS, THAT PRIVATE CAPITAL PLAYS A BIGGER ROLE ACROSS THE U.S. BUT ALSO ACROSS EUROPE AND WE HAVE BEEN INVESTING A LOT OF TIME WITH LEADERSHIP IN TC BUT OTHER GREAT CAPITALS AROUND THE GLOBE TO BE PART OF THAT CONVERSATION. FRANCINE: DO YOU HAVE TO TAKE BETS ON REGULATION IN AI OR DO YOU LOOK THROUGH THESE WEEKLY CONCERNS? JAMES: TORSTEN SLOK HAS DONE A LOT OF GREAT WORK ON SEEING WHETHER -- WHERE THE PROFITABILITY IS IN THE TECHNOLOGY CHAIN AND CERTAINLY AS YOU LOOK AT THE GROSS MARGIN CONTRIBUTION COMING FROM THE LANGUAGE MODEL TO THE DATA CENTER TO THE CHIP MANUFACTURING TO THE ECOSYSTEM, IT INCREASES DRAMATICALLY SO WE HAVE BEEN VERY ACTIVE IN FINANCING GP USE WITH A LOT OF THE GREAT OPTICS AND GREAT COMPANIES THAT ARE MAKING THEM COME UP BROADCOM BEING ONE, BUT WE BELIEVE THOSE ARE WAYS FOR US TO BE ABLE TO BE A VERY THOUGHTFUL INVESTOR IN CAPTURING GREAT SPREAD. IT WILL BE INTERESTING TO SEE WHAT THE REGULATORY BACKDROP DOES TO DATA CENTERS. YOU COULD BE RIGHT FOR THE WRONG REASONS IF THERE ARE MORE SEVERE RESTRICTIONS ON BUILDING NEW FACILITIES OR SOURCING ENERGY BECAUSE THE CONCERNS WITH THE COMMUNITIES, THE FACT THAT YOU HAVE ONE UP AND GOING IS A VALUABLE ASSET SO NO DOUBT IN ANY SCENARIO COMPUTE AND ENERGY WILL BE BOTTLENECKS AND THE MANNER IN WHICH YOU DO THAT, DEPENDING ON THE FLEXIBILITY AND THE BREADTH OF YOUR CAPITAL, THE BIG LESSON ON ANY CAPEX CYCLE IS NOT TAKING EQUITY RISK FOR A FIXED RATE OF RETURN AND SO THAT IS ONE OF OUR MANTRAS ACROSS THE APOLLO INVESTMENT TEAMS. VONNIE: GIVEN YOU HAVE ACTUALLY BUILT OUT SO MUCH OF THE INFRASTRUCTURE, HOW DO YOU MONITOR AI EXPOSURE? JAMES: ANY INVESTOR TODAY IS HAVING -- USING AI TO REALLY UNDERSTAND THAT THE SECOND AND THIRD DERIVATIVE IMPLICATIONS AND WHETHER IT IS A QUIDDITY, DISRUPTION YOU'RE TRYING TO ELIMINATE THAT. WE ARE NOT GOING TO BE A PERFECT INVESTOR BUT WE WANT TO BE AN INVESTOR WITH A HIGH BATTING AVERAGE AND NEVER GET TAKEN FROM THE TABLE OR HAVE TOO MUCH CONCENTRATION SO FOR US OVER THE LAST YEAR WE HAVE EXCEEDED OVER $1 TRILLION IN ASSETS. WHEN YOU LOOK AT THE DIRECT DATA CENTER AI EXPOSURE DIRECT, IT IS AN APPROPRIATE NUMBER FOR US. VONNIE: APOLLO'S PRESIDENT SPEAKING WITH FRANCINE LACQUA IN AN EXCLUSIVE INTERVIEW. THE WALL STREET JOURNAL LOOKS AT TENSION IN THE TREASURY DEPARTMENT NEXT. THIS IS BLOOMBERG. ♪ VONNIE:VONNIE: THIS IS BLOOMBERG BRIEF. IT IS TIME FOR YOUR FRONT PAGE. THE WALL STREET JOURNAL PROFILES SCOTT BESSENT'S TREASURY DEPARTMENT AND FINDS TENSION, TURNOVER, AND UNMET ECONOMIC GOALS. THE JOURNAL INTERVIEW CURRENT AND FORMER OFFICIALS FOR THIS ACCOUNT. NEXT UP, THE FINANCIAL TIMES REPORTING WE TANKER CAPTAINS ARE BEING PAID RATES EQUIVALENT $100,000 A MONTH FOR TRAVELING THROUGH THE STRAIT OF HORMUZ ALONG WITH A $50,000 BONUS FOR EACH TRIP. FREIGHT RATES HAVE REACHED A RECORD 1.3 MILLION DOLLARS PER DAY THIS WEEK COMPARED WITH $20,000 TO $30,000 A DAY LAST YEAR. THE WASHINGTON POST REPORTING ON DEATH ROW INMATE KRISTA PIKE SURVIVED A BOTCHED EXECUTION ATTEMPT BY LETHAL INJECTION. SHE IS NOW CONSCIOUS AND SPEAKING. HER TURNING TO REVIEW TO THEIR CALL FOR TENNESSEE GOVERNOR TO COMMUTE HER DEATH SENTENCE TO LIFE WITHOUT PAROLE. LET'S LOOK AT HOW MARKETS ARE FARING TODAY. AFTER HITTING THE RECORD IN THE LAST COUPLE DAYS FOR THE S&P 500 AND NASDAQ, WE MIGHT BE COMING OFF JUST A LITTLE BIT TODAY THANKS TO CRUDE OIL, WHICH HAS BEEN DOING A BIT OF A U-TURN IN THE LAST 24 HOURS. WE WERE AROUND 97 AND CHANGE YESTERDAY, ABOUT $101 A BARREL NOW ON REPORTS OF MORE TANKERS GETTING HIT IN THE GULF. I WANT TO POINT TO FRANCE BECAUSE WE ARE SEEING MORE PRESSURE IN FRANCE AGAIN TODAY AND THAT HAS THE 10 YEAR YIELD BACK UP 12 BASIS POINTS. THE SPREAD IS BACK TO 135 AFTER HAVING SHOWN SOME RELIEF EARLIER IN THE SESSION. COMING UP, WE WILL LOOK AT RISK ON APPETITE AND THE NASDAQ TRADE WITH KEVIN MAHN. ♪ VONNIE: IT IS 5:30 IN NEW YORK, 10:30 IN LONDON. I AM VONNIE QUINN WITH YOUR BLOOMBERG BRIEF. THE STOCK RALLY STALLING AFTER THE S&P 500 HIT ANOTHER RECORD. INVESTORS TURNING TO TODAY'S FED MINUTES. OIL GAINING AS TRADERS WEIGH INCREASED FLOWS THROUGH THE STRAIT OF HORMUZ AGAINST A PICKUP AND IRANIAN ATTACKS ON VESSELS. AND SPACEX IS SAID TO BE IN TALKS TO BUY $40 BILLION IN NVIDIA CHIPS AND WHAT WOULD BE ONE OF THE BIGGEST EVER FINANCINGS. THIS IS SETTING THE NARRATIVE. THE MOST PART TODAY WE HAVE OIL BACK ABOVE $101 A BARREL ON REPORTS OF INCREASED ATTACKS IN THE STRAIT OF HORMUZ. THAT IS QUITE THE SWING AND IT IS HAVING AN IMPACT ON EQUITIES. WTI NOT AS INTENSE BUT STILL AT $89.75 A BARREL AND IN EUROPE TENSION RUNNING HIGH WITH EUROPEAN GAS FUTURES AT 76.57 EUROS PER MEGAWATT HOUR AND NOT GOING DOWN ANYTIME SOON. FUTURES ARE LOOKING LIKE WE MIGHT SEE A STALL OUT TODAY BUT IT IS HARD TO TELL THIS EARLY IN THE MORNING. WE DID SEE A 2% GAIN FOR THE S&P THIS MONTH ALONE AND WE ARE ONLY SEVEN DAYS IN. THE NASDAQ 100 IS LITTLE BIT LOWER AND RUSSELL 2000 FUTURES ALSO POINTING LOWER. WE HAVE A 10 YEAR BOND SALE TODAY. DECENT APPETITE FOR THE THREE YEAR NOTE YESTERDAY. WE HAD THE TWO YEAR YIELD UNCHANGED IN THE SESSION ALTHOUGH WE ARE HIGHER FROM YESTERDAY. THE 10 YEAR YIELD IS BACK FOUR BASIS POINTS, ALMOST AT 5.32. THE 30 YEAR YIELD IS THE SAME. CREEPING EVER HIGHER AT THE LONG END. LET'S GET TO INDIVIDUAL MOVERS WITH JUSTINA LEE. JUSTINA: AS YOU MENTIONED EARLIER, THE BIGGEST STOCK NEWS TODAY, SPACEX IS IN TALKS WITH BANKS AND INVESTORS TO BORROW $40 BILLION TO BUY NVIDIA CHIPS. SPACE-X DOWN A LITTLE BIT IN PREMARKET AFTER THAT NEWS. ALSO IN ELON MUSK AI RELATED NEWS INTEL HAS SAID IT IS WORKING TO DEVELOP THE TECHNOLOGY WHICH IS THIS EFFORT TO SUPPLY ADVANCED SEMICONDUCTORS ACROSS ELON MUSK'S EMPIRE FROM TESLA TO SPACEX AND X AI. INTEL IS UP AND THAT IS ALSO AFTER ELON MUSK CLARIFIED THERE IS NOT A ROLE FOR TSMC IN THIS PROJECT. BLOOMBERG IS REPORTING THE E.U. IS CONSIDERING SAFEGUARD MEASURES TO LIMIT IMPORTS OF HYBRID VEHICLES FROM CHINA INTO THE EU AND THAT IS AFTER THESE IMPORTS SURGED. THE EU TRADE CHIEF IS TRAVELING TO CHINA TO ALL THESE PLANS COULD CHANGE BUT WE CAN SEE A SOURCE OF RELIEF FOR A LOT OF THESE EUROPEAN CARMAKERS. STELLANTIS IS UP 2% IN EUROPEAN TRADING TODAY. VONNIE: WHAT A PRICE. THANK YOU SO MUCH. JUSTINA LEE IN LONDON. WHILE MAKER RECORD SETTING FADING AFTER THE S&P 500 HIT ITS FIRST RECORD SINCE AUGUST. KEVIN MAHN WRITES "DESPITE THE S&P 500 INDEX TRADING YOUR RECORDS, GAINS HAVE BEEN CONCENTRATED IN CERTAIN AREAS OF THE MARKET SUCH AS AI REVOLUTION ORIENTED TECHNOLOGY STOCKS WITH OVERALL MARKET BREATH BEING LIMITED." HE JOINS US NOW. BANK OF AMERICA ALSO SAYING DEFINITELY BREATH IS LIMITED AND THAT IS ONE OF THE SIGNS WE ARE ABOUT TO POP AT SOME POINT. ARE WE ABOUT TO POP? I FEEL LIKE WE'VE BEEN HAVING THIS CONVERSATION OR A YEAR. KEVIN: IT SOUNDS LIKE MANY INVESTORS ARE WISHING THE AI BUBBLE WILL POP. PERHAPS WE WILL NEVER SEE A POP JUST PULLBACKS WHICH CREATE ATTRACTIVE ENTRY POINTS. I FIND IT INTERESTING THAT INVESTORS CONTINUE TO CLIMB THE PROVERBIAL WALL OF WORRY WITH OIL PRICES ABOVE $100. RE-ESCALATING TENSIONS BETWEEN THE U.S. AND IRAN. WE KNOW THE FED MAY OR MAY NOT RAISE INTEREST RATES AGAIN THIS YEAR AND MIDTERM ELECTIONS COMING UP. THE S&P 500 HIT ANOTHER ALL-TIME HIGH, LED BY TECHNOLOGY. WHAT CONCERNS ME IS WE DO NOT HAVE A BREATH IN THE RALLY, WHETHER WITH RESPECT TO STOCK PERFORMANCE OR EARNINGS? VONNIE: ALL OF IT IS LIKE WATER OFF A DUCK'S BACK. VEN RAM SAYS THE MARKET IS TAKING INTO ACCOUNT NEXT YEAR'S EARNINGS. WE KNOW THEY WILL BE PRETTY STRONG. IS THAT THE CASE IN THE NEXT YEAR WE WILL SEE THE MARKET TRYING TO DISCOUNT WHATEVER COMES DOWN THE PIKE AFTER THAT? KEVIN: FOR Q3 WE ARE ON TRACK FOR THE THIRD CONSECUTIVE QUARTER OF 20% PLUS YEAR OVER YEAR EARNINGS GROWTH. FOR THE THIRD QUARTER, JUST TWO STOCKS, MICRON AND NVIDIA, COUNT FOR ONE THIRD OF THAT EARNINGS GROWTH. THEIR PROJECTED EARNINGS GROWTH IS MORE THAN 490 OTHER STOCKS COMBINED. THAT IS GOOD FOR INVESTORS IN THOSE STOCKS, PERHAPS NOT AS GOOD FOR INVESTORS AND THOSE OTHER 490 STOCKS. LET'S NOT BE FOOLED THINKING EARNINGS GROWTH IS ACROSS THE CHARTS BECAUSE IT IS LIMITED TO THE AI INFRASTRUCTURE TRADE WHICH IS ONE OF MY FAVORITE STILL RIGHT NOW. VONNIE: VONNIE: WHAT HAPPENS WHEN WE SEE A LITTLE BIT OF COMING OFF? I FEEL LIKE WE GOT A PREVIEW AND ALL THAT HAPPENED IS THE EQUAL WEIGHT S&P DID BETTER BECAUSE OTHER STOCKS STEPPED UP TO THE PLATE. KEVIN: WE ARE SEEING THAT NOW. WE SING OTHER STOCKS ON THE HEELS OF WHAT CONSTELLATION ANNOUNCED WITH GOOGLE. WE SAW THAT IN THE DEFENSE ARENA WHEN RTX SIGNED A $20 BILLION CONTRACT WITH THE U.S. NAVY TO REPLENISH THEIR TOMAHAWK MISSILES. WE ARE STARTING TO SEE OTHER GROWTH OPPORTUNITIES RESURFACE AGAIN BUT AI INFRASTRUCTURE WILL CONTINUE TO LEAD THE WAY AND I THINK IT IS WITH US FOR THE END OF THIS DECADE. VONNIE: IF YOU ARE AN INVESTOR TRYING TO BE VERY CONSERVATIVE A YEAR AGO AND PULLED UP THE NASDAQ 100 AND SAID I'VE HAD SOME NICE GAINS, I AM GOOD. YOU HAVE FOMO. ALL OF YOUR PEERS ARE DOING BETTER. BANK OF AMERICA SAYS CALL OPTIONS ARE AN OPTION. WHAT WOULD YOU DO? KEVIN: I WOULD REMIND INVESTORS NOT TO TRY TO TIME THE MARKET. I'VE BEEN DOING THIS FOR THREE DECADES THAT I CANNOT TIME THE MARKET. I THINK THERE IS A BETTER WAY TO INVEST IN TECHNOLOGY. LOOK AT THE ENTIRE AI ECOSYSTEM. DO NOT TRY TO FIND THE NEXT NVIDIA. DON'T JUST LEVEL INTO THE SOFTWARE STOCKS. CONSIDER THE HARDWARE NAME SPIRIT DATA CENTER CONSTRUCTION COMPANIES. DATA CENTERS ARE STILL BEING CONSTRUCTED. AND OF COURSE POWER AND WATER. AI REVOLUTION STARTS AND STOPS WITHOUT POWER AND MEMORY AND WATER. VONNIE: THERE ARE SOME A CONCERNS. MORATORIA IN SO MANY STATES WHICH MEANS THE DATA CENTER REVOLUTION MIGHT NOT HAPPEN. WE ALSO HAVE LISA SU HEADING TO SOUTH KOREA FOR A SECOND TIME TO TALK TO SAMSUNG BECAUSE WE NEED MORE MEMORY. ALL OF THOSE THINGS, PLUS THE 30 YEAR YIELD WE SAW HIT 5.7%, IS NOT OF THAT CONCERN YOU? KEVIN: ALL OF THAT CONCERNS ME BUT IT IS NOT ENOUGH TO SLOW DOWN THE AI REVOLUTION NOR IS IT ENOUGH TO SLOW DOWN THE BILLIONS OF DOLLARS THAT LARGE-CAP TECH STILL HAS TO SPEND. I THINK ABOUT THE DATA CENTER MORATORIUM. I SAW THERE OVER 4000 DATA CENTERS IN EXISTENCE RIGHT NOW AND THERE ARE PLANS TO BUILD MORE. PERHAPS THIS WAS JUST A MIDTERM ELECTION RALLYING CRY. PERHAPS THAT STARTS TO DISSIPATE AFTER THAT. EVEN IF THE PACE OF DATA CENTER GROWTH SLOWS DOWN WE HAVE TO MAINTAIN THE EXISTING DATA CENTERS AND THERE IS PLENTY OF COMPANIES USING THOSE DATA CENTERS TO FUEL THEIR AI ALGORITHMS. I STILL BELIEVE IN THE AI INFRASTRUCTURE BUILDOUT. IF JENSEN HUANG IS CORRECT AND THERE IS BETWEEN THREE AND $4 TRILLION SPENT ON AI INFRASTRUCTURE BY THE END OF THE DECADE, THEN WE HAVE TRILLIONS MORE TO GO. VONNIE: LAST TIME YOU HAD A FEW INTERESTING NAMES IN THE ENERGY SPHERE. GIVE US SOME MORE TODAY. KEVIN: I MENTIONED HVAC, A COOLING PROVIDER. NO ONE THINKS THAT IS SEXY. THE LAST STAT I SAW FROM CREATIVE PLANNING, IT IS THE NUMBER ONE PERFORMING STOCK IN THE S&P 500 ON A CUMULATIVE TOTAL RETURN BASIS OF THE LAST FIVE YEARS. COMFORT SYSTEM. ON THE POWER SIDE I LIKE AMERICAN ELECTRIC POWER, A UTILITY COMPANY. A GOOD DIVIDEND ABOVE 3%. THEY SUPPLY POWER TO 5 MILLION CUSTOMERS IN 11 DIFFERENT STATES, INCLUDING VIRGINIA, WHICH HAS BECOME THE DATA CENTER CAPITAL OF THE WORLD. VONNIE: IS ALSO WHERE CONSTELLATION WILL BE BUILDING OUT THEIR NUCLEAR THEIR PERHAPS THE UTILITIES WILL NOT BE AS NECESSARY. KEVIN: FOR MOST OF THE NUCLEAR POWER PLANT'S ARE OWNED AND OPERATED BY UTILITIES LIKE CONSTELLATION AND DUKE ENERGY AND NEXTERA ENERGY SO I THINK UTILITIES ARE THE WAY TO HARNESS THE POWER NEEDED FOR THE AI REVOLUTION. VONNIE: YOU WILL NOT BE SWAYED FROM YOUR THESIS WHAT ARE YOU LOOKING TO BUILD A NEW THESIS FOR WHEN SOMETHING GOES AWRY. SURELY SOMETHING WILL HAVE TO GO AWRY. KEVIN: YES AND I THINK UTILITIES CAN BE OR FALL BACK. NOT YOUR FATHER'S OR MY FATHER'S UTILITIES. THEY WILL BE A CRITICAL BACK END COMPONENT OF THE AI REVOLUTION TODAY, NEXT YEAR, AND FOR THE BALANCE OF THIS DECADE. I ALSO THINK ABOUT AEROSPACE AND DEFENSE STOCKS PULLBACK SIGNIFICANTLY IN THE SECOND QUARTER. WHAT HISTORY SHOWS US IS WHEN THEY HAVE PULLBACK BY 12% OR MORE, ONE YOU'RE OUT THERE HIRE 100% OF THE TIME BY AN AVERAGE RETURN OF 29%. THIS TIME COULD BE DIFFERENT BUT THAT IS AN AREA TO LOOK AT BECAUSE OF THE BILLIONS OF DOLLARS BEING THROWN INTO DEFENSE ACROSS THE GLOBE. VONNIE: WE MAY OR MAY NOT GET THE ANTHROPIC IPO? DO YOU GET IT ESPECIALLY GIVEN SPACEX WHICH HAS NOT PERFORMED THAT BADLY. KEVIN: SPACEX GAVE US A LESSON TO LOOK AT NEW COMPANIES THAT ARE NOT PROFITABLE AND HAVE NOT PROVEN THEIR BUSINESS MODEL JUST YET. I THINK ELON MUSK IS THE WILLY WONKA OF OUR TIMES AND MANY INVESTORS BELIEVE YOU CAN DO EVERYTHING BUT HE IS NOT PROFITABLE WITH SPACE-X JUST YET. HE IS TAPPING THE DEBT MARKETS AND A SIGNIFICANT FASHION. WITH ANTHROPIC I BELIEVE THEY COULD PUSH IT OFF TO NEXT YEAR BUT IF THEY WERE TO IPO THIS YEAR I THINK INVESTORS WOULD BE WISE TO WAIT AND SEE HOW THE COMPANY GROWS AND HOW THEIR BALANCE SHEET IMPROVES BEFORE THEY THREW DOLLARS AT IT. VONNIE: ALWAYS WONDERFUL TO CHAT WITH YOU HERE AT THAT IS KEVIN MAHN -- ALWAYS WONDERFUL TO CHAT WITH YOU. THAT IS KEVIN MAHN. BILLIONAIRE INVESTOR RAY DALIO WARNS AI AS A PLASTIC BUBBLE THAT WILL BURST SOON. HE POINTED TO RISING INTEREST RATES AND THE NEED TO TURN WEALTH INTO CASH AS THE REASONS FOR THE BUBBLE TWO. -- FOR THE BUBBLE TO POP. VLADIMIR PUTIN ADDED ALMOST $60 BILLION TO THE OUTLAYS IN THE BUDGET. ACCORDING TO SOURCES DEFENSE EXPENDITURE IS EXPECTED TO APPROACH ABOUT $199 BILLION BY THE END OF THIS YEAR. IT IS THE LATEST SIGNAL PUTIN IS PREPARED FOR THE WAR WITH UKRAINE TO CONTINUE ESCALATING. PARTNERS GROUP IS PROPOSING A NEW WAY TO HANDLE ELEVATED RISK AT THE FUND. IT PLANS TO SPLIT THE FUND INTO TWO PORTFOLIOS, SEPARATING OLDER ASSETS FROM YOUR INVESTMENTS. THE AIM IS TO GIVE INVESTORS SEEKING CASH A ROOT OUT WHILE OTHERS STAY INVESTED IN NEWER HOLDINGS. OIL GAINS ON REPORTS OF INCREASED ATTACKS BY IRAN IN THE STRAIT OF HORMUZ. THIS IS BLOOMBERG. ♪ >> THE STRAITS OF HORMUZ ARE OPEN. MORE OIL FLOWING UP -- ALMOST AS MUCH OIL FLOWING BEFORE THIS BEGAN. NOT ONLY ARE THEY IN FREEFALL NOW THE IRANIAN ECONOMY IS ABOUT TO REACH A PLACE A FEW COUNTRIES HAVE BEEN IN HOW BAD IT WILL GET. VONNIE: MARCO RUBIO SPEAKING IN GREECE TODAY ON IRAN'S LACK OF CONTROL EVEN AS IRAN WRAPS UP ATTACKS ON SHIPS IN THE STRAIGHT. JOINING US IS KATE OF BLOOMBERG GOVERNMENT. SO WHAT IS THIS POSTURE THE U.S. IS TAKING THAT IT HAS COMPLETE CONTROL OF THE STRAIT BUT MARKETS ARE SUGGESTING IT DOESN’'T. KATE: THERE IS AN UPTICK IN ATTACKS FROM IRAN ON THE SHIPS. THE SHIPS ARE INCREASING GOING THROUGH THAT REALLY VITAL THOROUGHFARE FOR OIL AND GAS AND OTHER THINGS WE'VE SEEN AS CRITICAL MINERALS TO GET THROUGH. SO IRAN HAS BEEN UPPING THE ATTACKS OBVIOUSLY THIS IS AN IMPORTANT TIME NOT ONLY DOMESTICALLY HERE IN THE U.S. WITH THE MIDTERM ELECTIONS LESS THAN FOUR WEEKS AWAY AND GAS PRICES BEING A FOCUS OF THAT. BUT ALSO OBVIOUSLY THE CONFLICT OVER THERE IN THE MIDDLE EAST IRAN YOU KNOW KNOWS THAT IT IS UNDER THREAT OF COURSE AND THE U.S. GOVERNMENT, THE TRUMP ADMINISTRATION WANTS TO SEE SOME KIND OF A VICTORY THERE. VONNIE: AND IT'S RESISTING GETTING INVOLVED IN THE CONFLICT. I WANT TO ASK YOU ABOUT THE PRESIDENT WEIGHING AGAIN AS HE HAS BEEN FOR WEEKS NOW A POTENTIAL SUSPENSION THE FEDERAL GAS TAX. TALKING ABOUT 18.4 CENTS PER GALLON THAT IS FEDERAL TAX. CAN HE DO THIS UNILATERALLY WITHOUT CONGRESS. KATE: THIS SEEMS LIKE SOMETHING WHERE YOU WOULD NEED TO HAVE CONGRESS BROUGHT BACK. CONGRESS IS OUT, ALL THE LAWMAKERS ARE BACK IN THEIR STATES AND THEIR CONGRESSIONAL DISTRICTS CAMPAIGNING IN THESE FINAL WEEKS BEFORE THE MIDTERM ELECTIONS. IS THERE SOME WAY TO DO THAT WHERE YOU CAN DO THAT WITHOUT CONGRESS. WHEN PRESIDENT TRUMP TALKED ABOUT THIS YESTERDAY, HE DID NOT OFFER ANY DETAILS. IT WOULD SEEM THAT CONGRESS WOULD NEED TO COME BACK AND ACT IN ORDER TO DO THAT. BUT AGAIN WE DON'T, HE DID NOT GIVE A LOT OF DETAILS TO EXPLAIN HOW THIS MIGHT GET DONE. REPUBLICANS WHO CONTROL BOTH THE HOUSE AND SENATE OBVIOUSLY OUT ON THE CAMPAIGN TRAIL THEY ARE TALKING ABOUT COST-OF-LIVING INCREASES AND EVERYONE IS FEELING THAT INCREASE IN DIESEL AND FUEL AT THE GAS PUMP. SO IT IS TOP OF MIND FOR LAWMAKERS WHO ARE BACK IN THEIR DISTRICTS IF THEY NEEDED TO COME BACK, WOULD THEY? IT SEEMS UNLIKELY BUT NOT IMPOSSIBLE. IS THERE SOME WORK AROUND WHERE THE TRUMP ADMINISTRATION COULD DO SOMETHING WITHOUT CONGRESS, PERHAPS. WE'VE SEEN GOVERNORS IN STATES YOU KNOW THEY'VE ROLLED BACK THEIR OWN GAS TAXES IN THEIR STATES SO THERE COULD BE SOME KIND OF CAMPAIGN TO GET MORE STATES TO DO THAT. THIS IS SOMETHING THAT HAS BEEN TOP OF MIND FOR VOTERS AND SO WE EXPECT IT TO CONTINUE TO BE MONITORING WHAT THE ADMINISTRATION WANTS TO DO AND IF CONGRESS HAS SOME ROLE WHERE THEY NEED TO COME BACK. VONNIE: YOU HAVE TO WONDER EVEN IF CONGRESS WERE TO COME BACK AND THAT SEEMS LIKE SUCH AN AMOUNT OF WORK TO BRING CONGRESS BACK AND HAVE THAT VOTE. BUT IT'S ALREADY TOO LATE ANYWAY. ONE OR TWO MORE PAYCHECKS AT MOST BEFORE THE MIDTERMS. IS THAT REALLY GOING TO BE NOTICED IMMEDIATELY IN SOMEBODY'S PAYCHECK ANYWAY? KATE: IF YOU'RE LOOKING AT WHEN SOMEBODY GOES TO FILL UP THEIR GAS TANK, $.18 YOU KNOW IT COULD MAKE SOMEONE FEEL LIKE GAS PRICES ARE GOING DOWN, BUT YOU'RE ABSOLUTELY RIGHT TO CALL ALL OF CONGRESS BACK WHEN THEY HAVE VERY TIGHT MARGINS ANYWAY, HOW WOULD THIS VOTE GO. THIS IS A LOT OF UNCERTAINTY, MORE QUESTIONS THAN ANSWERS AND AGAIN I THINK IT SPEAKS TO THIS AFFORDABILITY ISSUE AND STOP OF MIND DURING MIDTERM ELECTIONS. VONNIE: THANK YOU SO MUCH FOR JOINING US. TURNING TO THE AI RACE, SPACEX SAID TO BE TALKS -- IN TALKS WITH BANKS AND INVESTORS IN ONE OF THE BIGGEST EVER DEBT FINANCINGS FOR AI BUILDOUT. JOINING US NOW IS NEIL CAMPLING. THIS COMING REALLY NOT VERY LONG AFTER THE IPO RAISED A WHOLE BUNCH OF CASH FOR SPACE X. IS THIS ALL GOING TO GET SPENT IN THE ECONOMY AND SOON ADDING TO GROWTH AND PRODUCTIVITY MAY BE? NEIL: THEY ARE CURRENTLY SITTING AT 100 BILLION DOLLARS OF CASH ON THE BALANCE SHEET FOR THE MOMENT. THEY'RE EXPECTED TO BURN THROUGH $40 BILLION OF THAT CONTENT FOR THIS YEAR. THE NEED TO RAISE CAPITAL NOW, PROBABLY TAKING ADVANTAGE IN THE CREDIT MARKETS FOR THESE KIND OF INSTRUMENTS. BECAUSE WERE SEEING A LOT OF APPETITE FOR NVIDIA CHIPS IN FOR THE BUILD OF AI INFRASTRUCTURE. THERE IS A NEED TO SECURE SUPPLY AS SOON AS POSSIBLE. PART OF THAT TRANSACTION AND DEMAND THAT'S OUT THERE. IT CERTAINLY WITH THE BUILDOUT AND MUSK WANTS TO CONTROL THE BUILD OF THAT. THERE WILL BE A HUGE AMOUNT OF CAPITAL THAT NEEDS TO BE DEPLOYED IN THIS MASSIVE AI CRISIS GOING ON. VONNIE: ARE WE GOING TO SEE MORE OF THIS, APOLLO AND BLACKROCK SEEM TO BE WANTING TO LEAD THIS. BANKS WILL BE INVOLVED IS A END TO THE APPETITE AND DOES IT BRING OUT APPETITE? NEIL: IT CERTAINLY SEEMS TO BE AT THE MOMENT THE ATTRACTIVENESS OF THESE KIND OF INSTRUMENTS IS PERHAPS DEMAND -- DAMPENING DEMAND AND SO THE OTHER BOND ISSUES AROUND THERE. THE AI TRADE IS OBVIOUSLY IN MANY PARTS OF THE MARKET IT'S BEEN DRIVING UP GROWTH OBVIOUSLY. IN TERMS OF GDP GROWTH AND CAPEX GROWTH, IN TERMS OF EARNINGS GROWTH. THAT CONTINUES. ANALYSIS FOR THE MORNING OF THE S&P RECORDS S&P XAI IS ONLY UP 6% YEAR-TO-DATE. THE AI INDEX IS UP NEARLY 60% YEAR-TO-DATE. SO AI IS DRIVING CERTAIN PARTS OF THIS MARKET. VONNIE: CAN I ASK YOU ABOUT APPLE IT'S LAUNCHING A DOORBELL LOCK AND THERMOSTAT. I PRESUME LGE OFFERS THIS ALREADY. IS THERE A BIG MARKET FOR APPLE BRANDED PRODUCTS LIKE THIS. NEIL: THERE COULD BE. THE KEY POINT WOULD BE ABOUT THE INTEGRATION WITH THE PRODUCTS WITH THE APPLE ECOSYSTEM. NORMALLY APPLE PRODUCTS DON'T COME CHEAP. SO THAT COULD BE ONE POINT OF PAIN OR MAYBE DIFFERENTIATED ASPECT FOR SOME OF THE LOWERING PIECE OF THE MARKET. WHAT IT DOES SUGGEST IS IT SHOWS THE NEW CEO WHO WE KNOW IN THE BACKGROUND IS CLEARLY PUTTING PRODUCTS BACK AT THE HEART OF APPLE TO TRY AND DRIVE GROWTH GOING FORWARD. SO THIS PARTNERSHIP IS ONE STEP. I THINK APPLE PROLIFERATING TO OTHER PARTS OF THE DEVICE MARKET GOING FORWARD I THINK. >> IT'S INTERESTING BECAUSE THEY ARE CARRYING THE LGE BRANDING. THAT IS BLOOMBERG'S NEIL CAMPLING. COMING UP WE GET YOU SET UP FOR YOUR TRADING DAY, THIS IS BLOOMBERG. ♪ VONNIE: THIS IS BLOOMBERG BRIEF, I'M VONNIE QUINN IN NEW YORK. A LOOK AT WHAT'S AHEAD TODAY. LEVI STRAUSS AND BRIGHT DIGITAL REPORTING EARNINGS AFTER THE BELL. U.S. TREASURIES AUCTION 39 BILLION DOLLARS WORTH OF 10 YEAR NOTES AT 1:00 P.M. EASTERN AND THEN MINUTES FROM THE FED'S SEPTEMBER MEETING AT 2:00 P.M. EASTERN THAN A CLOSER LOOK AT THE DEBATE OVER THE RATE HIKE EVEN THOUGH WE'VE GOT DATA SINCE THEN THAT WOULD PERHAPS CHANGE THAT DEBATE EVER SO SLIGHTLY. SPACE X DOWN 2% PLUS AFTER WE HAVE REPORTED IT'S IN TALKS WITH BANKS AND INVESTORS TO RAISE $40 BILLION OF CHIPS FROM NVIDIA. INTEL RISING BACK UP MORE THAN 1%. CONTINUING TO WORK WITH ELON MUSK ON THE TARIFFS THERE HAD BEEN SOME DISCUSSION ABOUT THAT AND TSMC'S INVOLVEMENT RECENTLY BUT THEY TELL US THAT THAT IS GOING TO WORK. CONSTELLATION BRANDS DOWN ABOUT 5% REAFFIRMED ITS TOP EARNINGS-PER-SHARE. TAKE A LOOK AT YOUR MACRO PICTURE PARTICULARLY THE 30 YEAR YIELD TODAY. ♪