Semis Suffer, Capex Concerns Crop Up, and Bullish Bets 7/24/26

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You're listening to The Exchange. Here's today's show.

**Brian Kelly** (1:00)
And welcome to The Exchange, everybody. Happy Friday. I am Brian Kelly is off today. She will be back on Monday after a rough week. A pretty nice turn today, at least for the industrials.
We are right now just at or near the highs of the day, at least on the Dow and the S&P, real estate communications, consumer staples. Some of the leaders, the Mag 7 and the NASDAQ, though, they're a mixed bag. Big earnings from Intel, not enough to bring stability to a volatile trade. Apple and Netflix are higher. Tesla down again. Some good news around oil. Price is a little bit lower today, but overall, still up 20 bucks a barrel since the July 3rd low. What's not easing? The price you pay at the pump, the national average, now at $4.10, a 12-cent jump in just a week. All right. Hi, everybody. We have got a big hour ahead, and let's kick it off with your money and what may be a make or break week next week. Because not only is next week the busiest week overall for earnings, look at all those names that we're showing you there.
It's also arguably the most important week for earnings, because you've got Meta, Microsoft, Apple, and Amazon all reporting. By the way, you've also got a Federal Reserve meeting on Wednesday as well, and who knows exactly where the Iran War might be in just five days. Joining us right now to talk about all of it is Ellen Hazen, Chief Market Strategist and Portfolio Manager at FL Putnam Investment Management. Ellen, it's good to have you on the program again. We're not looking past today to next week, but right now, what are the most one or two important things on your radar?

**Ellen Hazen** (2:37)
Well, it's great to see you, Brian.
Thanks for having me. So what we're looking at more than anything else is number one, AI hyperscaler CAPEX because that is still going up, and that is driving so much of the economy and so much of those earnings estimates right now. And number two, of course, the price of oil and the degree to which that flows through to higher gas prices at the pump and then whether or not that ends up impacting the consumer. Hasn't happened too much yet, but those are the most important things we're watching. And of course, the way we monitor those one way is just through earnings estimate revisions.

**Brian Kelly** (3:11)
And how those come in so far?

**Ellen Hazen** (3:13)
Earnings have been great so far. We've had about a quarter of the S&P reporting. We've had 70% revenue beats, 80% earnings beats. It looks like the earnings are going to come in at over 20% year over year growth, which is also going to set us up for over 20% year over year growth for the full year. And even next year looks pretty solid as well. So, so far, so good, still early days, but very happy with what we've seen so far.

**Brian Kelly** (3:36)
You know, it's interesting because we've got three of your picks and I love getting these stock picks. Kind of colloquially call it Opportunity Friday, why not? Two of them are directly tied to the consumer. You've got Brinker International, Ticker is Eat, their main company is Chili's, the restaurant chain, and you've got Target as well. These are direct consumer names which I believe should be impacted by consumer spending and the price of gas. You obviously, at least not now, Ellen, not that worried.

**Ellen Hazen** (4:04)
I think that they're, in fact, I would look at it the other way. There might be upside from here if oil comes down, if peace breaks out, if the hostilities decline, and if gas prices come down. So I think that we're already pricing in a little bit of hesitancy. But if you look, for example, at Brinker International, they're growing earnings solid double digits, maybe even as high as 20%, and it's trading for 15 times earnings. They're gaining market share. They're putting up over 6% comps. It's really hard to see how a stock like that doesn't work, and any lower gas prices would be a bonus.