Afternoon podcast 10-9-26

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Welcome to the afternoon Rob Black Show podcast, a guaranteed human podcast, which can also be heard on AM 1220 KDOW weekdays at 5 p.m. and on 860 AM The Answer weeknights at 11 p.m. The views and opinions expressed in the program are not necessarily those of this radio station or its sponsors and should not be construed as legal tax or investment advice. You should always consult the appropriate advisor before making any financial decision, all rights reserved.

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Markets recovered on Friday in a broad recovery. There's big stories about cancer vaccines.

Ultimately, stories about SpaceX and Starlink getting into the telecom industry, maybe going after Apple and Samsung.

Today, I'm going to talk a little bit about midterms and how they can hand the S&P 500 a year-end rally. Let's get to it, shall we?

The broader market's advance is taking place with relatively little movement in crude prices or treasury yields. That's not the story from yesterday. That's not the story from the last six weeks. It's been all about oil and treasury yields. So today, no action in oil and yields has allowed company-specific developments and improving participation to remain dominant influences. Stock market is enjoying a broadly positive session.

With the indices close to all-time highs. Now, of note, Mike Ditka passed away. I don't have a lot of fun things to say about Mike Ditka. Of course, I have one, though. A fan once called Mike Ditka a baby on his call in radio show. Iron Mike responded by giving the guy his office address and telling him, You tell me the time and when, and I'll whip your butt. Can't hold a candle to Mike Ditka. Man was a tough man.

One of the more consequential headlines was SpaceX. They announced an agreement to acquire a nationwide wireless spectrum portfolio from Grain Management. The development has weighed on established wireless carriers, including AT&T, down 10 percent, Verizon down 9 percent, T-Mobile down 12 percent. There's concerns about increased competition from Starlink's expanding mobile ambitions. The communication services sector was a relative laggard compared to the rest of the markets. Now, if SpaceX gets into the business of providing wireless services in the United States, they're going to have to put a lot of equipment on towers, cell phone towers. Companies in that area include American Tower, ticker symbol AMT, up 7.6 percent, Crown Castle up 13.4 percent, SBA Communications up 6.6 percent on expectations that a larger terrestrial wireless network could generate additional demand for tower infrastructure. Strength in tower companies has helped propel the real estate sector towards the top of the sector rankings. Now, you're saying cell phone towers, real estate. Someone owns the land that those towers are built on. And that's those companies, American Tower, Crown Castle, SBA Communications are all real estate plays with pretty nice dividends along the way. For SpaceX, the opportunity is a larger recurring revenue market. But spectrum is only one prerequisite. You got to get regulatory clearance, compatible devices, network deployment. Pricing, customer acquisition will ultimately determine whether it's technical advantages translate into profitable growth. Tower releasing should accelerate execution, but also introduce recurring costs that must be covered by mobile services economics. Gene Munster said on this development with SpaceX and cell phones today, says Elon says he doesn't want to make a phone. But Gene Munster still thinks eventually SpaceX will. Vertically integrated handset on a Starlink mobile network could deliver features carriers can't match and cheaper service. That's a big problem for Samsung. It's a bigger problem for Samsung than it is for Apple. Apple's devices and services tie in is harder to break, so it says Munster. Tesla up 2.3 percent after Reuters reported today that September sales for Shanghai built Model 3 and Model Y vehicles increased 5 percent year over year. Accelerating from August is 3.6 percent growth. Amazon up 2.8 percent today, contributing to generally positive showing amongst mega cap stocks. Apple is not a mega cap stock doing terribly well today. It's down about 1.5 percent, down five bucks. On a Nikkei report, the company asked some suppliers to reduce component production for its iPhone refresh by as much as 20 percent. That news is also pressured supplier Skyworks, which is down 4.5 percent.

So semiconductor stocks, a bit of weakness today.

I can't really find much there as far as stories go. There was reports yesterday that OpenAI's annualized revenue was not on track to meet or exceed 70 billion. Today, the reports are that they are on track to exceed 70 billion. Easing concerns by that Financial Times report that came out yesterday.