Mahn: NVIDIA proves the A.I. revolution is alive

Why don't we start with your word of the day? How do you see today shaping up after a bit of a rough week last week? So my word of the day is transition, not just as it relates to the election, but also in terms of the interest rate environment, as we transition from higher interest rates to lower interest rates over the next two years. The other area that's transitioning, of course, is the stock market rally beyond the mag seven. Now into those non-magnificent 493 other stocks. As we know, Frank, last year, those mag seven stocks accounted for 62% of the total return of the S and P 500 through the first half of this year, still 59%. But here's the good news. In the third quarter of this year, they only accounted for 9% of the total return of the stock market. And that's good. That's healthy for the continuation of this bull market run. You know, this week, it's all about, uh, and the, or not all about, I don't want to over exaggerate, Kevin, but when I said that might be the highlight of the week, you nodded your head in affirmation. A lot of people looking ahead to Nvidia. I want to ask you about something when it comes to mag seven and all multinationals, the rising dollar dollar of about two and a half percent since this election day, how do you view that rise in the dollar? Does that concern you at all? And when it comes to Q4 earnings, 2025 there's a lot of things that concern me going forward about the potential for earnings growth from here. Fortunately, what we saw in Q3 about earnings growth rate blended around 5.3%, the fifth consecutive quarter of year over year earnings growth, but obviously a strong dollar is going to weigh on multinational companies. And with respect to Nvidia, that's why I was nodding my head. I think Nvidia is going to remind investors once again, that the AI revolution is alive and well this week. A lot of confidence. Are you saying beaten rays or just beat? How much longer can they beat analysts expectations? But I think they're going to show continued strong demand for their black ball chip. And then we know in 26 and 27, they're coming out with the Rubin chip. All right. Nvidia is not resting. I wanted you with a couple of topics very quickly though, because I still want to get to your pick investing in China after Xi Jinping, uh, gave the incoming administration, uh, some advice to make quote unquote wise choices. Yes. Uh, I'm very dubious about making investments into China as a portfolio manager. Right now. I see better opportunities quite frankly in the U S and other international developed markets. I like building a globally diversified portfolio, but China is not part of that mix for me right now. Energy investing with the idea that Chris Wright may be the secretary of the department of energy. Yeah. I think energy you have to look into the multinational utilities that supply electricity, that supply natural gas, and also nuclear energy. We need a multi-pronged solution to these tremendous energy needs that we have in our country, including now the AI revolution and data centers. We want to get to your pick. What is your pick for us today and why? So I think you have to look at the aerospace and defense sector, two names. I like that one, one Lockheed Martin, but how about how met aerospace? They're an ancillary benefactor of the increase in defense spending that I think is going to take place under a Trump administration where there was momentum already in the Biden administration. How much supplies the parts that help make Lockheed Martin's F 35 fighter jets or Lockheed Martin, of course, being the largest event contractor in the world. One thing we've got to point out though, we're looking at Lockheed Martin. We're looking at defense stock. Yes. Big run-ups this year. Yes. In fact, your pick how met doubled so far this year, a lot of geopolitical tensions. What's going to make it move higher? I think additional spending into this area. Our country needs to replenish upgrade and modernize our military capabilities. There's going to be more defense spending into those areas and that's going to allow these companies to continue to expand their. Your picks for us today, Lockheed Martin, how met again, how met doubling your date. That was our mystery chart. Kevin Mott. It is always good to see you.