Look back on the trading day with Josh Lipton as he leaves no stone unturned while examining Monday’s biggest market trends.
Miso Robotics CEO Rich Hull joins the program to talk about the kitchen automator’s adoption of Nvidia’s (NVDA) Vision AI. Miso Robotics will integrate the model into its fry cook robot, Flippy.
VantageScore CEO and President Silvio Tavares stops by the show to discuss the “risks on the horizon” for consumers ahead of the holiday shopping season, particularly among younger consumers.
To watch more expert insights and analysis on the latest market action, check out more Asking for a Trend here.
This post was written by Luke Carberry Mogan.
Video Transcript
Hello and welcome to asking for a trend.
I’m Josh Lipton for the next half hour.
We’re going to be breaking down the trends of today that will move stocks tomorrow.
There is a lot to keep track of.
So we’re focusing on what you need to know to get ahead of the curve.
Here are some of the trends.
We’re going to be diving into a surge in treasury yields weighing on the broader market.
The 10 year yield spiking above 4.1%.
But tech was the standout.
The NASDAQ managing to eke out again on the day.
We’re diving into the trading day takeaways straight ahead plus a closer look at the state of the consumer.
Recent survey from the fed shows Americans haven’t been so worried about paying their credit card bills since the pandemic.
We have expert insight on the warning signs that are flashing and robots come into a restaurant near you.
The company behind Flippy, the robot is now integrating in video technology to bring A I capabilities to its devices.
The CEO of Miso robotics is here.
Well, consumer spending remaining resilient in the lead up to the holiday season.
Us retail sales saw stronger than expected growth in September.
Shoppers are also looking to spend more this holiday season.
A recent Deloitte survey shows consumers plan to increase their spending by 8% compared to last year.
However, amid all the spending, Americans are increasingly worried about missing a minimum debt payment during the next three months.
That’s according to the New York fed here with more on the wallet shift for consumers is vantage score.
CEO and President Silvio Tavares Silvio.
It is good to see you.
So always look to you Sylvio for a read on the consumer.
You know, we are an earning season.
We heard from the big banks, of course big tech is on deck, but you get your perspective, Silvio, you, you know, you have access to that CRE credit data when you’re looking through that.
What do you see?
How healthy, how strong does the consumer look to you right now?
Well, the consumer looks healthy, but the reality is there’s definitely risk on the horizon.
Both banks see it and consumers see it according to our monthly vantage score credit gauge indicator banks actually throttled back on new credit account in the uh most recent period in September across every major loan category, credit cards, auto loans, personal loans, every category banks cut back and consumers really see risk as well on the horizon.
They’re cutting back.
For example, if you compare September credit card balances to August credit card balances in September, they actually decrease slightly.
And uh part of this is just the upcoming election, consumers are uncertain about what’s going to happen next and banks are also uncertain about what’s going to happen next and they see risk on the horizon.
The two presidential candidates have very different uh policy, economic policy agendas.
And so basically both are basically taking a pause, you know, when we talk about the the consumer silvio, you know, obviously not one consumer, there’s many ki kinds of consumers, you know, low income, middle income, high income.
What kind of differences are you seeing?
Well, you know that that term we all learned during the pandemic, that K shape recovery.
Well, that’s definitely made a comeback.
If you look at the experience of millennials, older affluent consumers doing just fine.
In fact, you could see that in the monthly credit gauge, the average overall consumer credit score is 702, 300 is the worst score.
850 is a perfect score.
And so overall you see the average consumer credit health remaining pretty healthy through September, mostly driven by those older consumers.
Um you know, those born after 1965 what we call um uh X. Um Now on the other hand, younger less affluent consumers, they are actually struggling and in fact, they’re continuing to struggle even more.
In the most recent period, we saw delinquencies across all credit products really increasing for those younger uh less affluent consumers.
And really what’s driving a lot of that difference in experience is whether you’re a homeowner or not.
If you’re older, you own your own home, you’ve got a cushion there.
You’re not exposed to, um, inflationary pressures.
Younger folks are not homeowners typically and they are struggling with the increased interest rates and, uh, the very high rate of inflation that we’ve seen over the last 24 months, you know, Sylvia, uh, the fed already cut, once delivered, that outsized cut, we have any number of strategists had one very smart strategist today on the show who said, you know, listen, they continue to believe they’re gonna keep cutting because inflation just is not where Jay Powell wants it to be.
Um how much of a tail wind potentially is that for consumers, including the consumers, you’re, you’re highlighting as is facing more challenges.
Well, it’s definitely a a tailwind but the reality is it does take some time to hit and we saw that in the September numbers, right?
Um You know, September was when we saw the fed cut rates and we had expected um some more lending or a pickup in lending.
Um and actually quite frankly, an increase in demand among consumers.
Uh but actually that didn’t happen.
And so that’s quite notable.
So I think the FED is going to look at this data and they’re going to really have to think about whether they um do a more aggressive rate cutting.
Uh But the reality is um there’s some challenges with cutting rates too aggressively.
You don’t want to be in a position where you reinflate uh re reignited inflation.
Um So definitely a, a balancing act, but I think if you look at just the way consumers are using credit, um The the there are some warning signs, there are some flashing signs particularly on the credit card front having said that Sylvia, you know, holidays fast approaching, what would be your guess about consumer spending during this holiday season?
You think they spend spend spend even if they have to take on more debt to do so.
Well, I think there’s a definitely a desire to spend more, but I think a lot rests on how this election plays out.
Uh If you look at the data for the most recent period in September, credit cards in particular are flashing a lot of warning signs.
Um, delinquencies were up across all products.
Delinquencies were up on a 30 to 6090 longer basis really across every vintage of loans and uh age of delinquencies.
Everything is flashing red.
So I think consumers do want to spend more, but the reality is they’re uncertain about how the election is going to play out and depending on how that election plays out, especially the presidential election that’s going to happen, impact on consumers’ willingness to spend more.
So the bottom line is it’s uncertain that’s how consumers see it.
That’s how banks see it um as we get closer to the election.
Um and after the election, we’re going to be able to give you some more insight on what’s going to shape out for the balance of the holiday spending season.
Sylvia, always great to see you and have you on the show.
Thanks for joining us.
Thanks for having me on Josh Dow drops 300 points to start the week as investors brace for a packed week of earnings and now finances Joshua Schafer joins us now with the trading day takeaways, Josh.
Hey Josh.
Yeah, I wanna start with a big move that we saw in the 10 year treasury yield.
So we know that the 10 year has been moving up over the last couple of weeks as traders have started to maybe price out some of those fed rate cuts.
But today was a particularly big move.
So you’re gonna take a look here at the 10 year we got year to date, but I’m gonna go a little bit smaller here so we can see the move up 11 basis points today.
Now sitting at its highest level since July, which is a term we’ve been talking about a lot recently.
And really what was interesting to me, Josh is take this right?
So move higher in rates, perhaps expectations that rates would stay a little bit higher for longer than we thought.
Look your interest, interest rate, sensitive sectors, right?
And you’re seeing a clear trade here.
Right.
So the Russell two, that was interesting watching that one, a sector that has benefited from this right, benefited from lower rates and it actually rallied at the end of last week.
Get that big move up in the 10 year.
There goes a Russell rally, it’s all gone.
If you’re gonna get big moves up in yields like that similar thing with sector action, Josh, I’ll just flip too quickly here if I can get over there for you, you saw also interest rate sensitive sectors, not have a good day, right?
Your laggard on the day was gonna be real estate.
And that again, it’s just a pretty clear intra day.
It’s not quite loading for us, I don’t think because XL E did not drop 9% today to be clear, but I’m gonna flip to, I’m gonna flip to our second takeaway because this relates to the tenure.
So something we’ve talked about a lot with the tenure is as rates go higher.
You’re going to see investors.
This is according to strategists pile back into where they feel a little bit more safe up in quality up in quality is what the strategists like to tell us, right?
So let’s take a look at two of those names today that hit record highs.
So taking a look inside the NASDAQ, you will see, I don’t think our board’s quite working here, Josh, but NVIDIA did close at a record high up at 4.4% and a final one, I’ll point out for you is Apple, which did rise today up 0.6 or 0.6% also hitting record high.
And now we have Apple earnings coming up on deck and also the big cloud giants, Nvidia’s customers on deck too.
Are they gonna keep spending spending?
Right.
And if they keep spending, does that sort of continue that NVIDIA rally to remember, we’re gonna talk a lot about big tech earnings over the next week.
You don’t get video until the end of November.
So it’s gonna be a lot of read through to what’s going on with them but not really the fundamental story, but we’re talking about earnings.
So I wanna skip to that for our final one here, earnings beats are being rewarded more than normal.
So what we’re looking at here in blue right here is the average one day reaction so far this earnings season through about 20% of reporting up 3.15%.
Go back on it average over the last 20 years.
Normally stocks only rise 1.5%.
What this is telling strategists is ok. Investors are currently screening for earnings beats and revenue beats more than normal right now.
And if you do that, you’re gonna see a big big pop in your stock looking for winners, looking for winners, right?
And maybe not harping on the losers as much either, right?
When you look here down 2.6%.
What’s interesting is this spread here?
Winners outperforming more than uh, losers are under performing.
First time.
We’ve seen that since 2020.
So perhaps, maybe a little bit more benefit for winners than we’ve seen in the last couple of quarters.
Right, Joshua, thank you.
Appreciate it.
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We’re asking for a trend right on the other side.
Miso, a pioneer in kitchen automation and A I driven robotics today announced it is integrating NVIDIA computing and robotics technologies to bring A I motion planning capabilities to its next generation Flippy Fry Station.
Joining us now to discuss all this is in the partnership is Rich Hull, Miso Robotics, Ceo Rich.
It is good to see you.
So let’s let’s get straight to that news there integrating NVIDIA technology rich.
What is this gonna mean for your robots and, and your business?
Well, thanks for having me, Josh and I’m not sure I could have created any better set up than what you guys talked about in your last segment with NVIDIA hitting record trading highs today.
It’s surely a great lead in for what we’re doing with them and what we’re announcing today.
So um this is a partnership with NVIDIA.
We have spent a lot of time over the last 12 months in particular and I’m fairly new to me.
So, so I’ve been here about 12 months and we’ve really leaned hard into strategic partnerships and NVIDIA is, is one.
So NVIDIA is really at the tip of the spear when it comes to vision A I and their technology related to it and their ability to give us a very unique and special access to that.
As one of their first restaurant technology and automation partners is really impactful for us.
And so our flippy fry station robot is an A I powered robot.
It automates the what is really one of the most dangerous and least desirable jobs in a commercial kitchen, which is the fry station.
Flippy can cook everything that one would expect from french fries to onion rings, to chicken nuggets, even tacos and really just takes over the heavy lifting on the fry station so that you can take that labor.
You can redeploy them to somewhere else that brings far more impact in the restaurant and restaurants are having a really hard time sourcing labor to work in commercial kitchens these days.
And there’s also escalating minimum wage.
California has a $20 an hour minimum wage.
Seattle just went to one that’s close to $21.
You’re seeing more and more states 25 in particular, raising their minimum wage.
So we know the direction that this is going.
And just by automating the least desirable jobs, you’re allowing yourself as a restaurant operator to redeploy that labor into other spots within the kitchen.
And Richard.
I’m curious, how many restaurants are you all now in?
Well, so we don’t talk about that publicly because our partners ask us not to talk about that publicly.
So we want to be respectful of that.
Nonetheless, we’re growing fast.
We’re a growth stage business.
And I think that’s the reason that some of these strategic partnerships are so important to us.
We’ve leaned into partnerships recently with not only NVIDIA but Ecolab Amazon and some others.
And so when the king maker of their respective spaces come in and they choose to partner with a growth stage company, like it really sends a signal to the rest of the market that these guys are worth collaborating with.
And for that, we’re very grateful, but it really does mean that they’ve gone through a list of other potential partners and they’ve chosen us and I think that’s really impactful, but we’re on a real growth trajectory.
And those are, you know, as you are showing on your screen, there are some partners that we’ve announced publicly.
Uh There’s some that we have not, but Jack In the Box White Castle, Cali Burger and others are ones that we’ve uh that we’ve announced.
And so we’re, we’re rapidly growing and that was the job that I was brought in to do as the growth stage.
Uh CEO brought in um uh by miso and, and rich.
I’m, I’m curious how much do you all estimate, or maybe even a third party estimates you save a restaurant uh by using and deploying this technology.
It’s really a compelling proposition, Josh, because the cost of flippy is never going to cost more than the full time equivalent human.
And so there’s really no downside for the restaurant operators on the flip side as you point out, there’s a lot of upside.
And so you get, you can, a restaurant operator can get between 10 and $20,000 per month of positive revenue impact per location for a flippy and in an already thin margin business, that’s a lot.
And so some of that is driven by food waste savings.
Flippy.
Never, he cooks it on demand all the time and um nothing ever has to get thrown away.
Nothing ever gets returned.
Uh There’s labor redeployment, flippy never calls in sick.
There’s no workers comp plus flippy generally can work faster than a human.
And so that means restaurants can sell more.
You have shorter lines, better customer experience.
So all those together aggregate into a really nice package that brings the restaurant operators a lot of ro I and and value, you know, rich.
You, you’ve raised more than $100 million in crowdfunding.
I’m curious, what, what do you think’s next?
You know, direct listing IP O or those, those possibilities down the line.
Well, I wish I had a crystal ball.
I was brought in to, uh, drive us down that road.
And so we’ll see where we wind up there.
Surely are a bunch of possibilities.
I think the public markets are finally starting to come back after a couple of years.
I think that the, uh, one of the most successful IP OS of the last couple of years is Kava, which is in our space of restaurants.
I think that’s interesting.
I think with interest rates coming down, there’s potential for uh you know, financial investors to come in and uh and take a good look at the company.
Surely strategics uh are very interesting.
So we’ll see what happens.
But I think the real magic of what we’ve done is that we have in fact tapped into equity crowdfunding.
Some of that is just because everybody really understands our business.
Robots are cool.
They make for a great video, but everybody’s been to a restaurant.
And so they really understand the opportunity and it is for us, it’s, you know, it’s a Glipi eight by himself, the four or $5 billion revenue opportunity.
But automating the rest of the kitchen is a 15 to $20 billion revenue opportunity.
And so I think that’s really impactful, but for us, when we’ve got the equity crowd funders participating on the same cap table as strategic investors and also institutional capital, like there’s something very magic about that combination and we think it probably gives us a unfair advantage rich.
Great to have you on the show today.
Great story.
Thanks for joining us.
Thank you so much, Josh.
Stick around much more.
Asking for a trend right on the other side.
Time to check in now on luxury watches.
Despite a higher rate environment, the luxury watch market remains resilient.
And for more we’re bringing in Yahoo Finance’s pros submarine and pros.
Yes.
So Josh, I was at watch time, New York, which is the largest watch luxury watch show in New York.
I think even in this, in, in the US ninth year, they’ve been having this, this uh uh event and a lot of the big brands were there, luxury brands.
We saw a bunch of stuff there.
But what I heard a lot from executives was that the US market is so important to them.
Uh, a company called Ulysses Nardin High End Watches.
They, they, they sell watch $20,000 and above.
Uh they’re actually doing pretty well because that, that consumer rates don’t really matter.
Right?
You’re gonna pay a lot of money.
You, you want the watch, you’re gonna buy it.
Uh Also hearing about how, you know, it’s not just about the US, but also places like Japan also doing well too, right?
Parts some parts of the far east.
Uh but Asia, other places down and also, you know, saw some very famous people there and even Fred Savage was there, Fred Savage Wonder Years.
That is right.
He’s, now he’s a watch guy.
He’s a huge watch guy, huge vintage collector.
And he was kind of frustrated about how some of the watches he bought, he couldn’t tell if they were authentic or the, or the parts were auth or, uh, meant for that one watch.
So, he is a new company where he’s actually gonna authenticate people’s watches and say like, hey, here’s this Rolex you bought, I’m gonna see, open it up.
This dial is uh is, is, is, is part of that watch.
Not, it’s not a replacement.
These parts are all uh came with the original watch.
Here’s a certification.
I’m gonna give you a score and then where you can sell it on if you want to, you have this authentication going on.
Love that show.
The show is very big with the lips.
He said he’s a fan of the market domination.
Wants to come on formal invitation right now.
You me Fred Savage.
That’s good television.
Thank you pros.
All right.
Let’s take a look at what’s trending after hours sap raising its 2024 outlook for cloud and software revenue operating profit and free cash flow company’s guidance.
Also topping the street’s expectations as for its third quarter performance, a posting a 27% increase in non IRS cloud gross profit as well as a 9% increase in total revenue taking a look at new core.
Let’s get into that stock is moving lower.
After hours after the steel producer announced a Q three beat on revenue but a miss on earnings new core also projecting a decrease in Q four earnings driven by lower average selling prices and decreased volume in its steel mills segment.
That’s a wrap on today’s ask for a trend.
Be sure to come back tomorrow at 4:30 p.m. Eastern for all the latest market moving stories affecting your wallet.
Have a great night.