CNBC Overtime

The Federal Reserve’s preferred inflation gauge, the PCE index, rose 2.5 percent in June. The recent inflation data solidified expectations for a rate cut in September, but others say the Fed should consider cutting in next week’s FOMC meeting. “I don’t think that they will,” said David Mericle, chief U.S. economist at Goldman Sachs. “I think what they’ll use the meeting for next week is to tweak their statement to imply that a cut is closer at hand.”

Alphabet shares under pressure today after Open AI unveiled its search engine SearchGPT.  "I think Open AI has quite a bit of following right now and also people are using it for different things, and if they are able to merge the functionality, it will be a little bit of a threat there," said Ben Reitzes of Melius Research.

Big swings for the major averages today following Wednesday’s tech-driven plunge. Jim Paulsen of Paulsen Perspectives said he thinks the rotation will continue. But added, "it’s not your father’s market collapse...it’s got a very different feel, where most of the market is doing pretty well through this.” “Right now money is looking for a place to go in this continuing bull market and that’s the laggards,” said Barbara Doran of BD8 Capital. “I think this is normal pullback and taking money out of the high flyers.” 

I speak with Pegasystems CEO Alan Trefler after earnings results that have the stock up double digits.

This morning’s second quarter GDP report was the latest addition to a mixed bag of economic data. The June PCE report - the Federal Reserve’s preferred gauge for inflation - will be released tomorrow morning. As market's prepare for next week's FOMC meeting, Morgan Stanley global chief economist Seth Carpenter says tomorrow’s PCE report is “critical.”

Shares of Chipotle Mexican Grill rallied after beating earnings and revenue estimates for its second quarter. The company also reported a 8.7% increase in restaurant traffic. For Chipotle CEO Brian Niccol, it was a “terrific quarter.” “We’re very fortunate to continue to see the strength in transaction growth coming from every income cohort,” said Niccol.

Gooogle parent company Alphabet beat earnings and revenue expectations for its second quarter report, but Youtube ad revenue came in lower than anticipated. "This puts a slight wrinkle on companies that rely on brand ads," said ROTH Capital Partners (ROTH MKM) analyst Rohit Kulkarni. "Overall, I think this was a fantastic quarter. We like Google here as the best AI player here across the board." Google Cloud revenue came in slightly better than expected but according to Jefferies analyst Brent Thill, Google is a distant third among the cloud players. "Good to see momentum but honestly, there is better momentum at Azure, there is better momentum at AWS,' said Thill. 

Ether was in the spotlight today after hitting its highest level since June 20. Also, investors are waiting for spot ether ETFs to start trading tomorrow. "I think it'll be a historic launch," said Hunter Horsley, CEO of Bitwise Asset Management - their ethereum ETF is expected to trade tomorrow. "A lot of investors view bitcoin as digital gold, whereas investors view ethereum more as a technology play."

A political earthquake shaking up election season this weekend with President Joe Biden dropping out of the 2024 presidential race against former President Donald Trump. Biden endorsed Vice President Kamala Harris as the Democratic Party nominee. Mobius Emerging Opportunities Fund Chairman Mark Mobius joined CNBC Overtime on-set to discuss the impact of U.S. elections on investing in emerging markets like India and China. "Currently, it's total confusion because of the changes that have taken place with Harris now coming into the picture," said Mobius. "Before this, with the good possibility of Trump winning, people overseas were getting ready for trade restrictions... now, with this confusion on the election, it remains to be seen what happens going forward. Generally speaking, these markets are beginning to take a life of their own."

NXP Semiconductors ($NXPI) reported second quarterly results of adjusted earnings per share (EPS) of $3.20, one penny short of what Wall Street had anticipated and revenue of $3.13 billion which was in line with estimates. The company guided lower for its Q3 outlook which dragged the stock down nearly 7% in extended trading. “The actual quarter itself was fine... but the outlook is certainly lower for the September quarter, and given the company’s 50% roughly exposure to the automotive market, we do believe the automotive market remains fairly soft. Keep in mind that has been an ongoing issue this whole year,” said Tore Svanberg, Stifel Financial Corp. Managing Director and semis analyst.