Level since going public, all because of what its doing in, you guess it, tweight loss. We start off with the last trading day of the month a look at just how much things have changed in the month of september. We kicked off the month, the yield in the tenyear treasury was less than 4. 1 . Its risen 50 bases points, hitting levels not seen in 16 years. Volatility soared 30 to its highest since may, and meantime, stocks dropped with the nasdaq and s p locking in their worst months of the year. As we get ready to kick off the strongest time of year for the marks, what should we expect . Tim, what do you expect . I expect theres not going to be a fed meeting that was supposed to be a nothing burg that are turn into the a big burger. Were already on the move. But i guess what i expect is that sentiment and positioning have already made adjustments based upon how bad september was. And i think theyve already started to adjust backwards. I realize and carder probably thinks the about this all the time. As does bonawyn. Bonawyn likes volatility. Carter thinks about technicals. And at the end of the day, those are the things i think we can predict and set up. Going into the next year are, listen to who you want to listen to. Nike said last night their consumer is more resilient. Bodes well for back to school. I think were going to struggle and rates will push higher. Im looking more towards positioning and sentiment, which got very extreme to the negative, and are already starting to come back. I think its going to be okay. Its about money flow. Not much changed in the earnings multiple. Not much changed for the earnings quarter. Whats changed has been the dollar market, oil, and rates. Yet we know when you get the sequencing, when something gets too far one way, its usually right to play it the other way. Hard to time, but thats the idea. So consider this we know that just three months ago, four months ago, we were at 3. 5 on the tenyear yield, and oil was 65 a barrel and consensus was hard landing its coming now. All of a sudden thats out and its higher for longer because oils at 59 and rates are at four and a half. Its just extrapolating the current trend. Both are overdone. Dollars over done, oils over done. We should get you sound bullish. Thats the thing. The thes rolling over and rates are going down, why wouldnt you think the s ps going to go. There are relationships, inhavers and direct. If it was always so perfect with the dollar going up, oil should be on its knees, but theyre not. These relationships are spurious. Dont always go to way one would think. Trying to time it to the end of the year is a bit difficultle i tend to agree with a lot of points here, being things ebbed and flowed too much on the negative side. In the interim it isnt bullish. Money has been free for the last 15, 20 years. Thats different. The fed is telling us that is going to remain different. I dont think the playbook of old, buying the dips per se, is necessarily the way were going the see this happen. You have six month cds yielding around 6 . What we thought initially was we should be getting Long Duration on the end of the curve because things are are coming to a plateau. What youve seen now is a real move on the back end. That to me really puts pressure on the equity market because of the whole tina situation we have had for the better part of five years or so is no longer a reality. It simply is not. And because of that i think there are alternatives. Even if youre not successfully bearish, just the fact that theres another asset class that will give you compelling yields and returns is enough to take the froth out of the market weve seen recently. Does seem like it would be too good to be true to work past free money is dead, that scenario so quickly, grasso. And with higher for longer, the longer the rates stay higher, the burden gets bigger. Companies run up against a deadline in terms of they have to refinance their debt some time and theyre going to face higher rates. Same thing with the consumer. Yeah, i think for the large part, though, melissa, a lot of companies are not in the situation where they have to refinance any time soon. So if you look at the seasonality of the market, were at the end of the month, the end of the quarter, and if i think the stat is 84 of the time, if youre up going into the Fourth Quarter between 10 and 12 , youre going to be up at the end of the year, higher. Were there. So thats your seasonality issue. Thats playing for the bulls. The other thing is, 30 for funds actually end their fiscal year at the end of september. So now they have a clone slate so. Theres a lot of window dressing i would say going into the last week of this month and obviously the end of this quarter. If all the stuff that you entered into the show with the oil rising, rates rising, throw in the uaw if any of these things get better, the market should move higher. Im still in the bulls camp. I feel pretty good about that. We should have asked the mentalist. He did extraordinary things. The one question we didnt ask him. The correlation between stocks and bonds has been what i think the last couple weeks have been about, and those correlations are two and a half standard deviation. What does that mean . It just means that for traditional allocations, the 60 40 rule. Bloombergs got an index. Everybody does. When you have that kind of correlation, that tends to underperform. And what were seeing for a lot of people is that 60 40 rule has underperformed in this year. So while i think the headline numbers are pretty good on the index, i think we have to think about people that might be chasing a little bit going into year end. But that ultimately i think for allocation, the fact that you can grab mediumterm duration and lock in longterm rates is what a lot of investors should be thinking about. You havent had that opportunity for a long time, and some of the volatility, rates may go higher. You could look at your bond price and say, no oh. But youre not looking in for the bond price youre locking in for the yield thats attached to it. Speaking of yields i tend to agree with steve when it comes to the blue chips. Theyre not going to be in the position when they have to refi, and when they do theyre going to get sweetheart rates. You want to look at the actual index its outperformed and done quite well. If you look at the duration of those bonds they pulled back to the three or fouryear period, because those corporates were expecting that rates are going to fall and theyll be able to refi at a much higher rate. That setup may get challenged in the next few months and years, and i think that might be the shoe to drop in terms of credit at least widening some. When you start to see credit widen thats when you see the hits to the equity market. Big mistakes come from credit and leverage. Weve yet to have a real credit event. The nightmare scenario is if of course we really do start to stall on main street. You get some sort of economic weakness and yet oil and rates stay high. That of course is feels like were on the cusp of that right now. You get that, that is multiples can track dramatically. Thats my view on where i just think discretionary looks challenged in some of those defensive sectors like health care, like staples, and i think now energy, i think truly are defensive. And i look at health care and staples, and they have had a rough run. Youre at the bottom of especi essentially oneyear range on staples. I think its a pretty interesting time for a lot of companies, whether its a hersheys or General Mills where they rerated to the upside during covid if places they didnt belong and the market punished them as they should. Those are opportunities here into the Fourth Quarter and i think last year. Grasso, can you be bullish if you think the consumer is having trouble ahead of the Holiday Season . All the shopping typically done in the fourth the quarter, including halloween and thanksgiving, et cetera. If the consume as paying higher gas prices, higher heating prices for their home, higher prices at the Grocery Store you name it. Higher prices all around. Can you still feel good about the markets . Well, yes, up until you went off on that litany. But its a when i look at the consumer, you cant have it both ways. Weve talked about that the consumer is becoming more and more trapped, yet the economy is way too strong. So, its one or the other. I think that the consumers resiliency has shocked and surprised the economy. I would think that its probably going to continue. I think oil prices are going to be dropping, and if you look at oil futures, year from now, theyre pricing them at 84, so its in backwardation. If youre going out, the market sees this is not a true supply demand issue, this is a russia saudi arabia issue, which means its quasi temporary. If you look at student loan payback, no ones going to be forced to be paying back Student Loans because you still have an administration that says theyre going to push for forgiveness. So theres a lot of reasons to be bullish and have faith in the consumer. As markets wrap up, a messy month, chart master here is honing in on three areas of the market that the hoping to shake off an ugly year. What are the three areas . Rather than picking them myself i just sorted by, what is the worst . Lets look at the caboose, the rear. The three worst areas of the market, of course, banks, utilities, and precious metal stocks. You can see it here very clearly. You have the market up 11. 7, and then in descending order, gold miners, represented by the philadelphia gold and silver index, down 11. Do you jones eutility average, over 100 years old, and kb bank index. Lets look at the areas or themes. Theres not one thats good. These are the most beaten up go lower still. You can see on the screen here converging trend lines. You can interpret it however you want, but its broken through to the downside. Thats the bank index. Take a look at utilities as measured by the do you jones utility average. Weve just taken out the lows of almost a year and a half go, breaching the lower band. And finally you can see here is the philadelphia gold and silver average of important mining stocks. All really quite similar in terms of what theyve done. So big disparity with the market, and yet one might think, maybe we should bottom fish. I wouldnt. Interesting. What utilities and banks tell you is were going higher. Were worried about credit and the pressure on utilities to have the Free Cash Flow theyre generating. With Precious Metals its more or less pretty simple. The dollar kicked butt in the last six weeks and essentially rose 6 off a level. The correlations there are extremely high. Everything that were seeing about this setup sounds like a world where, especially in inflation is kind of peaking, sounds like the time you want to buy gold. I think forget the industrial uses for gold. Think about the monetary policies i think youre buying gdx, but if you look at some of the other resources, i think resource names look interesting as well. Integrated miners. And i think oils going higher. Bhp or rio. Oil prices started to rally. Not like chinas been given that strong of a shot in the arm, but if china shows a little bit of life, that could a lot in terms of multiple. For commodities i tend to agree spot on in term of precious metal companies. The dollar challenged that there, but fundamentally thats where id like to be. Banks not sure if yield is going higher or credit going wider. I would expect credit going higher given what weve seen in rates. That spread remained tight, and im not sure why. Steve, would you dare to bottom fish an area that the chart master says not to bottom fish . Zblinchts. No, i trust the chart master on that. Youre the only one here. On the premise that hes making. But you know, there are so many correlations. Carter likes to talk about correlations. When you look at gold, i cant help but look at bitcoin. Cant help but look at crypto. Then when you look at gold, do you do the miners or the commodity . And i think that weve talked the about this long enough on the show for, you know, a decade and a half now, that when you think gold is going to be moving, miners actually have a two or threetoone ratio they move gold both up and down. If you think its going higher, buy the miners. Miners or the metal . Miners. I agree with that analysis on the beta. I say this a lot about a lot of different miners. I think the companies are run differently. I think theres been a capital discipline. Thats why copper stay as stubborn. If theres been such a lack of investment in copper mines and infrastructure, and i think across the precious metal space, we also dont see that m a mania in the space that i think forced these companies to do their job. So i like gdx. I like silver over gold, and it continue to think uranium goes higher, too. Do you ever override how you read the charts with your fundamental belief in something . No. Never. What would be the point . Youve got tick to your discipline, unless you get a magic trick going. That wasnt magic. He was in our heads. Plus he doesnt a fundamental belief. Dangerous place to be. Developing story here. The deadline to avoid a Government Shutdown just hours away. Emily wilkins has the latest from capitol hill. Reporter lawmakers have spent all week voting on different spending bills and they recollect no closer to finding a path to end a Government Shutdown that is set to begin sunday at midnight. A stopgap measure backed by Kevin Mccarthy went down on the house floor today with 21 republicans joining democrats in defeating the measure. House republicans are actually meeting now to discuss a path four, and its just not clear what thats going to be. Some members are pushing to keep the Government Shutdown for weeks while they pass all remaining longterm spending bills. Others talk about teaming one democrats to force a vote on the floor. Honestly, the quickest way to end a shutdown would probably be for the house to take up a bipartisan bill the senate at expected to pass on monday. Chuck schumer called on mccarthy to bring the bill to the senate. Listen to what he edsaid this afternoon. The speaker needs to abandon his doomed mission of trying to please maga enthusiasts and instead needs to work across the aisle to keep the government open. Things seem to be getting worse for the speaker rather than better and its time for him the try bipartisanship. Reporter mccarthy has said that he not bring the senate bill to the floor unless it contains something on border security, and senators are trying to work on an amendment, but they actually need to have one thats going to get the support of both republicans and democrats, and thats going to be really, really difficult some at this point we absolutely look ah ah headed into a shutdown. The question is how long its going last. The longer it does, the more of a hit this could be to the economy. Melissa . Emily, thank you. Emily wilkins. We also wont get reads on the economy, because the Economic Data wont be released. Maybe thats good. Just look at the chart. Through go. Its amazing to me as a guy that spent a lot of time in a merging markets where a political shutdown and political wrangling and dysfunction is usually what causes sovereign cds and causes Government Bond yields to go sky rocking. Weve heard from every agency. Some more focused on the banks. Started with fitch. Heard moodys late last week talk about sovereign credit in the context of a Government Shutdown. Im not saying they should, that they shouldnt. Im just telling you thats not been part of the calculus. I think that has a lot to do with some of the last 10 to 15 bases points of bond market. It underscores government dysfunction. Sadly, government dysfunction is not likely to go away or get better any time soon. Yeah, we have had, what, somewhere around 20 different shutdowns since 1980. Both parties have held responsibility for them at times. Its probably pretty evenly split. Its not going away. Its only more contentious. And the truth is, there might be an 11th hour where the speaker has to actually bring something to the floor where he can get democrats to vote for him. That would probably be a death nell for his speakership, and i think its going to get a lot more murky. But when you look at the average time respond of these shutdowns, theyre probably on average eight days long, because of the extra long one we had recently. Lets hope we dont see one that lasts more than a week. Coming up, a weight loss drug that could enter the arena. Structure soaring. Well give you the skinny on why investors are excited. New trouble for the big three. Uaw announcing a new wave of strike as negotiations stall. Fast money will be right back. upbeat music Constant Contacts advanced automation lets you send the right message at the right time, every time. Constant Contact. Helping the small stand tall. Welcome back to fast money. Another company pulling its hat in the weight loss ring. Angelica, welcome to fast money. Whats the latest . Thanks so much for having me. Structure is saying people with obesity lost 5 of its body weight after taking its experimental pill once a day for four weeks. Shares up 35 today on the phase 1 b trial results. Nausea and vomiting were the most common adverse effects and thats common. None of the participants dropped out of the trial because of the adverse events. Investors are clearly excited about these results and the growing market for weight loss drugs. Analysts saying that structures pill could be kpi we lie lillys pill, and eli lilly being a growing powerhouse in the space. Its important to know this is a tiny trial and results are early. The study included only 24 people and findings will need to be confirmed in future studies. And this is a pill form, correct . Reporter correct. Tim, youre pointing out novo and eli lilly have had a pullback. Lillys down 11 from what looks like a blowoff top on volume and traded down to the 50. This is not cause for alarm if youre a bull. Whats cause for at least review is the competitive landscape. It is getting i think its less about the sum of the regulatory concerns that might be coming with some of these studies that are proving all kinds of side effects that arent great. I think its the competitive landscape. The question really is about total adjustable market and margin expansion. Those are things analysts have had a good time with lilly doing whatever they want. 78 times trailing tells you where the stock needs to go in the future. Right, and the irony is of course the winners, as much as theyre up, the really big moves have been from the losers, insp and decks com. Down 40 and 50 . Thats the best trade, being short the ones that are going to suffer. I think the pil