Schwab Network

The U.S. labor market shows signs of cooling, with slowing job growth and a decline in the foreign-born population impacting participation. Brian Jacobson, Chief Economist Strategist at Annex Wealth Management, explains the nuances of recent jobs reports and their implications for Federal Reserve policy. He outlines how the Fed faces a dilemma between supporting employment and fighting inflation, suggesting that rate hikes might not be the most effective tool for current economic conditions. Jacobson also pinpoints investment opportunities in European equities and U.S. construction and industrials, while advising a conservative approach to fixed income due to potential volatility.

In Friday’s 360 Round, the panel looks at Airbnb (ABNB) after the stock hit a new 52-week high following strong earnings. Wedbush’s Ygal Arounian is bullish on continued consumer spending and upgraded ABNB to Outperform with a $200 price target. Chris Davis of Hudson Value Partners says Airbnb is better positioned than other travel stocks as consumers favor shorter domestic trips, while expanded hotel partnerships and bookings could broaden its reach. He also points to the company’s “reserve now, pay later” program as a potential driver of future revenue.

Roy Behren of Westchester Capital Management, co-portfolio manager of the Merger Fund, believes the proposed merger between Paramount Global (PARA) and Warner Bros. Discovery (WBD) will ultimately close. He cites the numerous international regulatory approvals, the lack of U.S. Department of Justice objections, and the significant financial incentives for both companies to complete the deal. Despite a lawsuit from the California Attorney General, he suggests the parties may reach a settlement, potentially offering concessions similar to those made in Europe. He also notes the potential for a backup bid from Netflix (NFLX) if the deal were to be blocked, but maintains a strong conviction that the merger will proceed, highlighting the current trading discount as an inefficient pricing.

Tim Bohen from StocksToTrade.com has his eyes on three technology names for today's Big 3. First, Digital Turbine (APPS), where he says reports of the company's demise may have been "greatly exaggerated" as it trades to a 3-year high. Next, Bohen looks to Snowflake (SNOW), pointing to its growing lineup of agentic AI products. Lastly, he sees more room to run for Cloudflare (NET) following strong earnings and its key role in supporting internet infrastructure. Rick Ducat breaks down the technical setups taking shape in all three stocks.

CFRA's Arun Sundaram joins Morning Trade Live to look at the outlook for consumer staples companies as the sector faces a challenging operating environment. He continues to like Costco (COST) and Walmart (WMT) despite elevated valuations, pointing to margin expansion and the potential for double-digit earnings growth in the coming years. Sundaram also sees opportunities in agricultural companies benefiting from strong demand for ethanol and vegetable oil. Later, Tom White illustrates an example call vertical using the September monthly options series.

Shares of Airbnb (ABNB) climbed to their highest level since 2022 after the company reported strong earnings, improving free cash flow, and upbeat guidance. Marley Kayden recaps the results and examines the analyst reaction to ABNB’s rally, while Dan Deming discusses an example call spread designed to capture further upside while limiting risk if the move stalls.

KPMG Senior Economist Ken Kim explains how a recent jobs report, despite missing estimates, still paints a complex picture of the U.S. labor market. He dissects the impact of immigration on employment figures and wage growth in specific sectors. Kim also weighs in on the implications for inflation and the Federal Reserve's potential actions, particularly concerning the risk of a stagflationary environment.

Concerns about AI and tech heading into earnings season appear overblown, according to Paul Stanley of Arca. He says demand for compute remains strong, leaving Nvidia (NVDA) and Broadcom (AVGO) with room to run, while new opportunities emerge in companies applying AI to new uses.Stanley also says July’s jobs report reduces the likelihood of another Fed rate hike, which could provide another tailwind for tech. He sees energy availability and data center deployment—not chip supply or demand—as the bigger constraints on the AI buildout.

Stocks are higher Friday despite the U.S. losing jobs in July, as slowing average hourly wage growth and a drop in the unemployment rate to 4.1% offered potentially encouraging signs for the Fed’s inflation fight.Kevin Hincks breaks down the jobs report, the latest headlines from Iran, Airbnb (ABNB) surging after earnings, and The Trade Desk (TTD) plunging following disappointing quarterly results and a weak outlook.

Despite clearing federal scrutiny, the proposed merger between Paramount Skydance (PSKY) and Warner Bros. Discovery (WBD) still faces challenges from state regulators. Bryan Sullivan of Early Sullivan Wright Gizer & McRae says the case could hinge on expert testimony over whether the combined company would have too much pricing power.He says a narrower definition of the competitive market could ultimately determine whether the deal is allowed to move forward.