Nvidia earnings shows 'unrelenting demand', says Fundstrat's Tom Lee

>> WELCOME BACK. WE ARE MIXED

WELL NOW WE'RE HIGHER AS WE

HEAD TOWARDS THE CLOSE. NOW

THAT NVIDIA EARNINGS ARE OUT OF

THE WAY, IS THE AI TRADE ABOUT

TO TAKE ITS NEXT LEG HIGHER?

LET'S ASK TOM LEE. HE'S

FUNDSTRAT'S HEAD OF RESEARCH.

WELCOME BACK. SO SO HOW DO YOU

ASSESS THIS NOW. WE'VE WE'VE

CLEARED THE WAY RIGHT. ALL THE

AI STUFF IS NOW OUT OF THE WAY.

WE'RE LOOKING AT YIELDS. WE'RE

LOOKING AT OIL. WE'RE LOOKING

AT THE MIDDLE EAST. BUT HOW DO

YOU FEEL ABOUT THIS MARKET WHEN

YOU JUST HEARD CHRIS HARVEY AT

THE TOP OF OUR SHOW SAYING,

WE'RE GOING TO HAVE AN

EVERYTHING RALLY THAT'S GOING

TO TAKE US PAST 8000 BY THE END

OF THE YEAR?

>> YEAH. SCOTT.

>> I THINK THE MARKET IS PRETTY

HEALTHY.

>> IT SHOWED.

>> RESILIENCE IN THE FACE OF

HIGHER OIL, HIGHER YIELDS. BUT

I ALSO THINK THE US IS PRETTY

UNIQUE BECAUSE WE DO HAVE A

STRUCTURAL DRIVER FOR THE

ECONOMY, WHICH IS NOT ONLY IS

THE US THE PRODUCER OF AI, BUT

WE ARE ALSO RELATIVELY ENERGY

INDEPENDENT. AND THAT'S BEEN

EXPOSED BY THIS WAR. AND THE

CONSUMER IS IN PRETTY GOOD

SHAPE. SO, I MEAN, I THINK

THERE IS A PRETTY GOOD RUNWAY.

SO I'D AGREE WITH THE IDEA THAT

STOCKS COMPARED TO THE START OF

THIS YEAR HAVE MORE UPSIDE INTO

YEAR END. WE'VE GOT A FEW

THINGS WE HAVE TO WORK THROUGH

AS WE GET LATER THROUGH THE

YEAR. BUT I THINK FOR NOW THE

FUNDAMENTALS ARE HEALTHY AND

THAT'S SUPPORTED BY EARNINGS.

>> I DON'T KNOW. I DON'T KNOW

WHAT SHAPE THE CONSUMER IS IN

TO BE HONEST WITH YOU. I MEAN I

UNDERSTAND THE K-SHAPED ECONOMY

OBVIOUSLY TOP OF THE CASE

BETTER THAN THE BOTTOM OF THE K

IN TERMS OF THE DURABILITY TO

KEEP SPENDING. BUT YOU LISTEN

TO WALMART, WHICH WAS PRETTY

CAUTIOUS AND YOU'RE LIKE, WHAT

IS THE REAL STATE OF THE

CONSUMER? AND IF OIL PRICES

REMAIN ELEVATED FOR TOO LONG,

IS THAT THE THING THAT WRECKS

THE STORY?

>> SCOTT. YEAH, IN A WAY, IT IS

CASE SHAPED BECAUSE IF I HAD TO

SAY, OKAY, WHAT ARE THE THINGS

THAT ARE SORT OF BALLAST AND

THINGS MOVING THE CONSUMER, OF

COURSE, WE KNOW THAT IT'S

HIGHER GASOLINE, HIGHER FOOD.

AND OF COURSE, THERE'S GOING TO

BE A SHORTAGE OF SOME PETROLEUM

PRODUCTS. BUT ON THE OTHER END

OF THAT SPECTRUM IS, YOU KNOW,

THE WEALTH THAT'S GOING TO BE

CREATED BY THE IPO SPACE, OPEN

AI, ETC. I MEAN, THAT'S SEVERAL

TRILLION DOLLARS WORTH. AND AS

WE KNOW, THERE'S LIKE A

MARGINAL PROPENSITY TO CONSUME

FROM THE WEALTH EFFECT. SO I

THINK THE CONSUMER IS GETTING A

TAILWIND LATER THIS YEAR. BUT A

LOT OF IT IS IF FOR THOSE WHO

OWN EQUITY.

>> I MEAN, A TAILWIND FROM THE

FROM OWNING THE IPOS.

>> WELL, IT'S ACTUALLY THE

PRIVATE INVESTORS, AS WE KNOW,

SPACE WAS PROBABLY SEATED AT,

YOU KNOW, $50 MILLION. IT

PROBABLY RAISED, YOU KNOW, TENS

OF BILLIONS OVER THE LAST

DECADE, BUT NOW IT'S GOING TO

HAVE A NET WORTH VALUATION OF

AROUND 1.7 TRILLION. SO THAT

THAT'S ACTUALLY NOW GOING TO BE

MONETIZED FOR THE LPS OF THE

FUNDS THAT INVESTED IN SPACE.

SO THEY'RE, YOU KNOW, SEVERAL

TRILLION DOLLARS IS QUITE A LOT

OF STIMULUS TO THE ECONOMY.

>> WOW. OKAY. HAMPTONS REAL

ESTATE MARKET. WATCH OUT, AI

TRADE. HOW DO YOU FEEL ABOUT IT

AFTER NVIDIA?

>> I MEAN, A COMPANY WITH THE

SIZE OF REVENUES NVIDIA GROWING

AT. I THINK SHOWS THAT THERE IS

STILL, YOU KNOW, UNRELENTING

DEMAND FOR FOR THE PRODUCT

NVIDIA SELLS. AND THEN WE KNOW

THAT THOSE WHO ARE STARTING TO

USE AI ARE ACTUALLY NOTICING A

GAIN OF FUNCTION ON

PRODUCTIVITY. YOU KNOW, KEN

GRIFFIN REALLY STATED IT WELL

WHEN HE SAYS HE COULD SEE THIS

REPLACING A LOT OF ANALYSTS. SO

TO ME, I THINK NOT ONLY ARE THE

USERS OF AI BENEFITING, BUT

THERE'S STILL A SHORTAGE OF

THOSE WHO ARE SUPPLYING THE

EQUIPMENT.

>> BUT AREN'T YOU STILL CALLING

FOR A PULLBACK IN STOCKS AND

SOMETHING MEANINGFUL LIKE THE

ONE WE HAD ALREADY DIDN'T

REALLY QUALIFY, IF YOU WILL,

UNDER WHAT YOU WERE THINKING

COULD HAPPEN, RIGHT?

>> THAT'S RIGHT. SCOTT. I THINK

WE HAD LIKE WHAT YOU WOULD CALL

A ROLLING BEAR MARKET AND

THINGS LIKE MAG-7 AND OF COURSE

LAST YEAR IN ENERGY, BUT IN

SOFTWARE, ETC. BUT I THINK

LATER THIS YEAR THE MARKET IS

GOING TO CONFRONT A FEW THINGS.

YOU KNOW, ONE, OF COURSE, IS

JUST YOUR TYPICAL MIDTERM

SEASONALITY, YOU KNOW, THE

UNCERTAINTY INTO THAT. THE

SECOND IS THAT THERE IS A A DAY

OF RECKONING COMING BECAUSE THE

INVENTORY OF PETROLEUM PRODUCTS

IS SHORT AND NOT BEING

ALLEVIATED ANYTIME SOON. AND

THE THIRD IS WE PROBABLY HAVE

SOME CONCERNS LATER AS THE AS

THESE IPOS COME, SPACE OPEN AI,

ETC. THAT THERE'S A LOCKUP

EXPIRATION LATER. SO I THINK

THAT'S A SUPPLY OVERHANG. SO I

THINK THAT DYNAMIC COMES TO

PLAY LATER THIS YEAR. BUT IN

THE MEANTIME, I THINK INVESTORS

ARE FOCUSING ON AI FUNDAMENTALS.

AND YOU KNOW, THERE'S REAL

SHORTAGE. AND STOCKS THAT ARE

WORKING ARE THE ONES THAT ARE

SELLING SOMETHING THAT'S SCARCE.

>> TOM I WANT TO MAKE SURE I

HEARD YOU RIGHT. ARE YOU

CALLING FOR A ROLLING BEAR

MARKET IN MAG-7 NAMES BECAUSE

IS THAT WHAT YOU'RE LOOKING FOR.

YOU LOOK FOR THESE STOCKS TO

BECOME WEAKER AT SOME POINT AND

DRAMATICALLY SO AT SOME POINT

THIS YEAR. IS THAT IS THAT WHAT

I HEARD YOU SAY?

>> NO. TO CLARIFY, I THINK THAT

I THINK WE'VE ALREADY HAD A

BEAR MARKET IN MAG-7 AND

SOFTWARE. I THINK THERE'S GOING

TO BE A BEAR MARKET IN OTHER

STOCKS LATER THIS YEAR. YES,

BUT I THINK IT'S GOING TO SPARE

THE MAG-7 AND SOFTWARE. SO IT'S

GOING TO BE NAMES THAT EITHER

GOT LOFTY OR ARE GOING TO BE

AFFECTED BY THE FACT THAT THERE

IS A LOT OF SUPPLY OF NEW STOCK

LATER THIS YEAR, OR THE

COMPANIES THAT ARE GOING TO GET

HIT BY THIS SHORTAGE IN

PETROLEUM PRODUCTS. SO I THINK

THERE'S REASONS THAT WE COULD

HAVE HEADWINDS LATER THIS YEAR.

>> ARE YOU TALKING ABOUT LIKE

SEMICONDUCTOR STOCKS?

>> YEAH. SEMIS MAY BECOME A

BUBBLE THERE. THEY TO ME THEY

DON'T SEEM LIKE A BUBBLE YET.

YOU KNOW WHEN NV