OIL OUTLOOK: Market expert SEES prices falling if trade opens

CHERYL: TIME NOW FOR THE WORD ON WALL STREET, TOP INVESTORS WATCHING YOUR MONEY. JOINING ME IS PACER ETF DISTRIBUTOR PRESIDENT, SEAN OWE O'HARA. ALSO WITH US, MITCH ROSCHELLE. WE HAVE A NICE KICK OFF TO OUR TUESDAY MORNING. WE'LL TAKE IT. WE SAW A PULLBACK WITH THE S&P 500 AND NASDAQ YESTERDAY. THIS IS ABOUT A.I., CONCERNS ABOUT SPENDING AND ALSO INFLATION WORRIES. THE DOW DID MOVE HIGHER FOR A SECOND STRAIGHT DAY, WE HAD 140 POINT GAIN THERE, THAT WAS HEALTHCARE AND FINANCIALS. SEMICONDUCTORS ARE MOVING HIGHER RIGHT NOW THIS MORNING BUT THIS GROUP HAS BEEN PRETTY BEAT UP. CHIP STOCKS OF COURSE WEIGHING ON THE BROADER MARKET YESTERDAY. AND THEN NVIDIA, HERE WE GO, WE'VE GOT TO TALK ABOUT IT. THESE EARNINGS ARE COMING OUT AFTER THE BELL TOMORROW, THEY'RE SET TO REPORT SECOND QUARTER NUMBERS AND THAT COULD REALLY RESET THE THINKING ON A.I., SEAN, I WANT TO GET YOUR THOUGHTS ON ALL OF THIS. >> THANKS FOR HAVING ME. IT'S GOOD TO SEE YOU. THE NVIDIA STORY IS ONE THAT LEADS EVERYBODY'S NEWS CYCLE. I THINK NVIDIA'S PROBABLY GOING TO BEAT BUT THE QUESTION IS NOT WHETHER THEY'RE GOING TO BEAT OR NOT, IS THE STREET GOING TO ASSUME THE BEAT IS GOOD ENOUGH. THEY'RE TRYING TO GET A CAM HE'LL THIGH THE EYE OF A NEEDLE THESE DAYS. YOU'VE SEEN A PATTERN WHERE COMPANIES REPORT AND THEY REPORT GOOD EARNINGS AND GOOD REVENUES BUT THEY'RE NOT GOOD ENOUGH AND SO WE HAVE A LITTLE BIT OF A SELLOFF. AND THEN THINGS SEEM TO RECOVER. ON THE INFLATION SIDE OF THINGS, THE TREND HAS BEEN OKAY. I THINK WE PEAKED AT 4.1 ON CPE IN MAY AND JUNE AND JULY WE'RE IN THE THREES. JULY WAS 3.1. I DON'T EXPECT THE REPORT TO GET UNDER THREE BUT AT LEAST THE DIRECTION THIS THE RIGHT PLACE. THE REAL CHALLENGE, IT'S LIKE WHACK-A-MOLE, FIRST IT'S EGGS, THEN IT'S OIL, NOW IT'S BEEF. YOU HAVE INPUTS THAT ARE BOUNCING AROUND. IT WILL BE INTERESTING TO SEE WHAT COMES OUT OF JACKSON HOLE LATER THIS WEEK. CHERYL: LET'S TAKE A LOOK AT YIELDS AND WHAT'S HAPPENING IN THE BOND MARKET BECAUSE WE'RE GOING TO GET THE JULY CPE REPORT, EXCUSE ME, PCE REPORT TOMORROW. HERE'S THE EXPECTATION, LOOKING FOR A RISE OF ONE TENTH OF A PERCENT MONTH OVER MONTH, 3.6% YEAR OVER YEAR AND MITCH INVESTORS ARE LOOKING AT YOU MENTIONED IT E KEVIN WARSH, THAT'S GOING TO BE IN JACKSON HOLE ON FRIDAY. WHAT DO YOU EXPECT WITH REGARDS TO HOW HIS COMMENTS COULD AFFECT THE INFLATION STORY AND WHAT THE BOND MARKET IS TELLING US RIGHT NOW, THAT THE BOND MARKET IS VERY NERVOUS ABOUT WHAT WE'RE SEEING. >> THERE'S A LOT OF CROSS CURRENT THAT HAVE TO GET UNPACKED BY WARSH AND THE THING THAT'S INTERESTING IS THE PREVIOUS FED CHAIR AND THAT ADMINISTRATION WAS PERHAPS OVERLY TRANSPARENT AND I THINK WARSH HAS GOT A DIFFERENT MINDSET ABOUT TRANSPARENCY. SO THIS IS SORT OF A WINDOW INTO THE WAY HE'S THINKING ABOUT RATES. AT THAT POINT, YOU'LL HAVE A COUPLE OF THINGS. YOU HAVE THE SCOTT BESSENT AND THE FED AT THE SEPTEMBER 10th AUCTION, POTENTIALLY BUYING 30 YEARS BECAUSE THEY SAID THEY'RE GOING TO STEP IN. THEY HAVEN'T DONE THAT. YOU HAVE POTENTIALLY A WEAKENING DOLLAR AND THIS SORT OF NEW MODE OF BUYING BITCOIN AGAIN, BUYING GOLD AND SORT OF BACKING OFF THE DOLLAR. AND THESE ARE ALL THINGS THAT ARE FACTORED INTO THE FED'S THINKING. PCE IS INTERESTING BECAUSE THAT'S THE FED'S PREFERRED PRESSURE BUT I DON'T SUSPECT THAT'S GOING TO BE THAT MUCH DIFFERENT. IT'S A DIFFERENT CALCULATION BUT WROTE THEY'RE ARRIVING AT THE SAME NUMBER AND WHAT WE HAVE IS A STUBBORN, STICKY INFLATION THAT DOESN'T GO AWAY WHICH HAS BECOME A VERY BIG POLITICAL ISSUE. SO YOU HAVE THE POLITICAL SIDE OF THINGS. YOU HAVE INTEREST RATES. YOU HAVE INFLATION. AND THEN ON TOP OF THAT, NEXT -- THE ATLANTA FED HAS GDP AT 4% FOR THE THIRD QUARTER. DOES THAT MEAN THE ECONOMY IS STARTING TO RUN HOT AND IS THAT SOMETHING? THE PREPARED REMARKS, IT'S THE Q&A WITH THE PRESS, THAT'S GOING TO BE A WINDOW INTO THE WAY HE'S THINKING AND HOW THAT WILL IMPACT FED POLICY AND INTEREST RATES GOING FORWARD. CHERYL: ONE OF THE THINGS THAT STANLEY DRUNKENMILLER HAS WRITTEN IS THE BOND MARKET, LET THEM SPEAK AND HE SAID RISING INTEREST RATES ARE SEEING TROUBLE AHEAD, ARTIFICIALLY SUPPRESSING IT INDICATES DANGER. HE'S INDICATING THE MOVES FROM THE TREASURY DEPARTMENT. LET'S LOOK AT OIL. AGAIN, WE'RE SEEING OIL FALLING. NOW, THIS IS THE FIRST TIME WE'VE SEEN THE CONTRACT MEANINGFULLY FALL IN A WEEK, AFTER TREASURY SECRETARY UNLEASHED THE NEW WAVE OF SANCTIONS AGAINST IRAN, FORCING THE REGIME INTO ECONOMIC ISOLATION, BESSENT CALLED IT OPERATION ECONOMIC ONSLAUGHT, THEY TARGET DIGITAL ASSETS, GOLD, AVIATION, TECHNOLOGY AND SHIPPING, HE ALSO IS GIVING ANY COUNTRIES TRADING WITH TEHRAN TIME TO CUT OFF RELATIONSHIPS OR FACE ISOLATION. SEAN, YOUR THOUGHTS ON THIS. >> I THINK IT'S AN INTERESTING WAY TO FIGHT A WAR, IF YOU WILL. YOU DON'T NECESSARILY HAVE TO HAVE GUNS AND BODIES AND TROOPS ON THE GROUND. I THINK THEY CAN STRANGLE IRAN ENOUGH PERHAPS TO GET THEM TO REALLY COME TO THE TABLE IN A MEANINGFUL WAY. THIS IS ONE OF THE THINGS, THE OIL STORY WAS THE STORY FOR A WHILE. AS PRICES ELEVATED, THAT SPOOKED THE MARKETS. IT WILL BE NICE TO SEE PRICES COME BACK DOWN IF WE CAN GET THE STRAIT OPEN WHICH IS THE OBJECTIVE AT THE END OF THE DAY WHICH IS TO GET OIL FLOWING FREELY SO I THINK IF WE GET SOMETHING DONE I THINK YOU'LL SEE OIL DECLINE FAIRLY QUICKLY. REMEMBER, THESE ARE FUTURES PRICES WE'RE TALKING ABOUT SO WE'RE SPECULATING ON WHAT THE PRICE OF OIL WILL BE THREE MONTHS FROM NOW BASED ON WHAT WE THINK IS GOING ON TODAY AND SO I THINK OIL'S PART OF THE STORY. I THINK INFLATION'S PART OF THE STORY AND I THINK THE TREND LINE AT THE FED HAS CHANGED. WE WERE EIGHT OR NINE OF THE MEMBERS SAYING THEY WERE GOING TO HIKE, THEN IT WENT DOWN TO THREE. I PERSONALLY BELIEVE WE'RE GOING TO SEE A CUT THIS YEAR RATHER THAN AN INCREASE. CHERYL: INTERESTING. >> AND IF WE SEE THE DIRECTION OF INFLATION, WARSH MAY SAY THE DIRECTION'S GOOD NOW, THE ECONOMY SEEMS TO BE GOOD, LET'S LOWER INTEREST RATES A LITTLE BIT TO PROVIDE A LITTLE EXTRA ROOM. CHERYL: IT'S INTERESTING WHEN YOU SEE A 76% BET THAT WE'RE GOING TO GET A DECEMBER HIKE BUT THAT'S CHANGED FROM SEPTEMBER TO YOUR POINT. >> UNDER 20. CHERYL: THE CONVERSATION HAS CHANGED. SEAN, GREAT TO SEE YOU. >> THANKS