SOTS 2nd Hour: Bitcoin $100K, Bath & Body Works CEO, Meta's $10B AI Investment 12/5/24

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David Faber (1:00)

Good Thursday morning. Welcome to another hour of Squawk on the Street. I'm David Faber with Leslie Picker and Mike Santoli. We're live from Postline at the New York Stock Exchange. Carl and Sara both have the morning off. Let's give it a quick look at the markets and treasuries as well. S&P up barely, as you can see there. Let's call it all the broader indices up barely. The 10-year hanging out right around 4.21%.

Leslie Picker (1:25)

We are 30 minutes into the trading session. Here are some big movers. We're watching Bitcoin hitting a major milestone. 100,000 for the first time ever in crypto-related stocks, riding that rally. MicroStrategy Coinbase trading higher as well. MicroStrategy up more than 3%. Coinbase up more than 4%.

Bitcoin up around 50% since the presidential election. Much more on the crypto trade coming up. Shares of American Eagle, though plunging double digits right now. The retailer cut its full-year sales forecast and gave holiday guidance that came in below expectations. PBH also dropping on a disappointing holiday outlook. Shares of Robinhood Higher, CEO Vlad Tenev, says the company is considering expanding into sports betting in some way. That's stock a big winner, year-to-date up just over 1% right now.

David Faber (2:15)

Another big beneficiary as well of the Bitcoin boom, so to speak. The Dow S&P and Nasdaq are all coming off what are fresh record highs.

Technology and consumer discretionary also posting record closes. The Dow, by the way, they're making me read this, aren't they? They know I can't stand the Dow. 45,000, first time ever. It is up 25% this year, despite being a statistically insignificant index, as Mike Santoli can tell you a lot about. The S&P is up more than 30%. I've got it up 27.6% year-to-date.

Mike Santoli (2:48)

That's a one year.

David Faber (2:48)

But that's a one year. Nasdaq, wow, 40%. Again, that's one year, 31.5% year-to-date. Mike, I went through all the numbers. I mean, the MAG-7, the Big Tech seems to be having a bit of a comeback here in the end of the year.

Mike Santoli (3:03)

Yes, migrating back in that direction. Nasdaq 100 is up by 2.5% this week. The average stock, the median stock, and the S&P is down 3 quarters of 1%.

And to me, it does reflect how the market is in this kind of almost clockwork rotational mode right now where it's going to hold levels near highs and it's allowing small caps and banks and cyclicals to rest while the stock that really hadn't done a lot for a few months in the Nasdaq 100 just catch a bit. I think this is typical. Once a rally is rolling for a while, you look for things that haven't moved that much and aren't that extended. But if you look at the Nasdaq 100 on a relative basis to the equated S&P, I think we have a chart here. It was never fully out of the game. In other words, it built up this huge lead going into the middle part of this year. A huge spike, you see that there, around July of this year, where it was dominating everything. And NVIDIA was the only stock that mattered. We remember those days. And then it had this big relative pullback, but it never really gave back the outperformance and it's gone kind of sideways. I think the market character right now is it's more inclusive, but it's not keeping those stocks on the sidelines specifically. And again, I'll go back to Microsoft and Amazon and Apple. These stocks that really just churned sideways for a while, it's also coinciding, probably not coincidentally, with the fact that the economic surprise index has kind of rolled over. Some of the economic numbers in real time are a little softer. Yesterday's ISM services, we're going to wait for the jobs number, but you had Joltz that was okay. But the idea here is that everybody got bowled up about cyclicals and banks and industrials after the election for probably plausible reasons. And in the near term though, the data aren't really showing an acceleration, so therefore yields have come back into a pretty comfortable spot.