Summary of CNBC's "Fast Money" Episode: "China Trade Tensions Ramp Up… And Takeout Targets In The Pharma Space" (Released June 4, 2025)

Overview: Hosted by Melissa Lee alongside top traders Steve Grasso, Carter Worth, Dan Nathan, and Gaia Dani, CNBC's "Fast Money" episode delves into escalating US-China trade tensions, their impact on various industries, and emerging opportunities within the pharma and biotech sectors. The discussion also covers significant market movements, corporate downgrades, and strategic business moves by major companies.

1. Escalating US-China Trade Tensions

President Trump's Social Media Commentary:

• Melissa Lee introduces the episode by highlighting President Trump's early morning tweet on Truth Social regarding strained trade negotiations with China.
  • Quote [00:00]: "Rising tensions, President Trump with some very early morning social posts as trade negotiations with China remain strained."

Market Reaction:

• Despite the tensions, the Nasdaq and S&P showed slight gains, indicating that markets might have already priced in the strained negotiations.

Megan Casella’s Analysis (Timestamp: [02:09 - 04:36]):

• Megan Casella reports from Washington, noting the lack of progress in US-China discussions.
• Only the UK has reached a trade agreement framework among the 17 countries the US is negotiating with, according to the Trump administration.
  • Quote [03:22]: "US officials have said that it's needed at this point in order to get those bilateral talks back on track."

Panel Discussion:

• Steve Grasso suggests the market anticipated minimal impact from Trump's tweet, observing that yields reacted as expected.
  • Quote [04:48]: "I'm going to say this, I'm going to probably regret it, but the market is no longer terrified."
• Gaia Dani questions China's negotiating stance, pondering if China is genuinely negotiating or playing a longer strategic game.
  • Quote [05:39]: "Are they negotiating with us or are they just playing the long game?"

2. Impact on Financial Markets and Yields

Lower Yields and Market Sentiment:

• Melissa Lee discusses lower yields driven by weaker economic data and questions if this is a positive indicator for the markets.
  • Quote [07:11]: "You can make the argument that all of those things were actually in place and that's why we saw lower yields."

Panel Insights:

• Steve Grasso predicts that yields will rise unless economic slowing continues.
  • Quote [07:56]: "I still think yields go higher from here."
• Gaia Dani notes the historical lack of correlation between yields and market performance, suggesting that low yields may persist.
  • Quote [08:14]: "Never once did we close above 5%."

Dan Nathan references Robert Shiller's analysis, indicating minimal correlation between 10-year yields and market performance over decades. - Quote [08:14]: "There's no correlation, or I shouldn't say since 1940, no correlation."

3. China’s Rare Earth Mineral Export Curbs and the Auto Industry

Impact on Automakers:

• Phil LeBeau reports that China’s restrictions on rare earth minerals are affecting automakers, particularly those producing electric vehicles (EVs).
  • Quote [09:04]: "A lot of people said this is going to kill the automakers."

Automakers Adjusting Strategies:

• Companies like Ford and GM are focusing on core vehicles and delaying new model launches due to supply constraints.
  • Quote [10:05]: "They’re going to focus on their core vehicles, crossover utility vehicles, hybrids."

Panel Perspectives:

• Carter Worth discusses the broader economic implications, including potential shortages and decreased consumer spending.
  • Quote [12:37]: "This could really get a little bit messy here in the back half of the year."
• Dan Nathan emphasizes that solutions like magnet-free cars are long-term and not immediate.
  • Quote [13:54]: "But they are working on a magnet-free cars not going to be available today, not going to be available tomorrow or next year."

4. Biotech and Pharma Sector Takeout Targets

Jared Holz’s Insights (Timestamp: [28:48 - 31:29]):

• Jared Holz from Mizuho identifies potential acquisition targets in the biotech sector, highlighting Insemed as a prime candidate for a $20 billion transaction.
  • Quote [29:32]: "Once we see what that looks like, I think this is the next one of size to go."

Market Sentiment:

• The biotech sector (XPI) has shown improvement with a fifth consecutive session in green, driven by recent deal announcements.
  • Quote [31:35]: "This can continue though."

Panel Discussion:

• Dan Nathan suggests that large-cap pharma companies will continue to seek acquisitions to bolster their pipelines.
  • Quote [32:11]: "They have to do something."

5. Apple Downgrade and Market Implications

Needham’s Downgrade:

• Melissa Lee reports that Needham has downgraded Apple from "Buy" to "Hold" ahead of WWDC, citing threats to near-term revenue and EPS growth.
  • Quote [22:02]: "Needham cutting its rating on the iPhone make maker from buy to a hold."

Panel Reactions:

• Steve Grasso supports the downgrade, pointing out Apple's high valuation and ongoing trade tensions.
  • Quote [23:21]: "Valuation is still a concern in the crosshairs of this whole China thing."
• Dan Nathan and Carter Worth discuss Apple's strong install base and potential growth in services despite delayed upgrade cycles.
  • Quote [25:15]: "I'd rather be a buyer here."

6. Tesla's Self-Driving Technology Under Scrutiny

Fatal Accident Incident:

• A dashcam video shows a Tesla using Full Self-Driving (FSD) technology failing to brake for a pedestrian, resulting in a fatality.
  • Quote [27:26]: "The Tesla failed to brake for stop traffic hazard lights or a person waving it down."

Competitive Landscape:

• Carter Worth compares Tesla's approach to self-driving technology with Waymo's, highlighting Waymo's reliance on lidar and its rapid expansion.
  • Quote [37:19]: "Waymo is actually seeing exponential growth."

Panel Insights:

• Dan Nathan expresses skepticism about the reliability of self-driving technology, emphasizing safety and regulatory challenges.
  • Quote [38:10]: "Nobody knows how they're going to get to where they have to go with self drive as quick as they want to."

7. Fast Movers in the Market

Key Market Movements:

• Dollar Tree drops 8% after warning of a potential 50% profit decline due to tariffs.
• CrowdStrike faces SEC and DOJ inquiries related to a past outage, impacting its stock despite strong year-to-date performance.
• Constellation Energy is downgraded by Citi, leading to a price decline.
• Circle's IPO exceeds expectations, pricing at $31 per share and raising over $1 billion.
  • Quote [42:17]: "Circle has priced its IPO at $31 per share... raising about $1.05 billion."

Panel Discussion:

• Steve Grasso and Dan Nathan discuss the implications of these movements, noting that Dollar Tree and Constellation Energy may continue to face challenges.
  • Quote [34:50]: "This story is not going away but I think continue to trade lower from here."

8. "Curry Inc.": Steph Curry's Business Ventures

Alex Sherman’s Documentary:

• Alex Sherman previews a documentary on Steph Curry's business ventures, showcasing his diversified investments through 30 Inc., including brands like Gentleman's Cut and Unanimous Media.
  • Quote [42:17]: "They own a bourbon company called Gentleman's Cut, Unanimous Media, which is Curry's media company."

Panel Insights:

• Steve Grasso and Carter Worth commend Curry's strategic business moves and his transition from athlete to entrepreneur.
  • Quote [43:47]: "He is what he is."

Conclusion: The episode of "Fast Money" provides a comprehensive analysis of the current economic climate influenced by US-China trade tensions, their ripple effects across various sectors, and strategic movements within the biotech, pharma, and automotive industries. Additionally, it highlights significant corporate developments and personal business ventures of high-profile individuals like Steph Curry, offering listeners valuable insights into market dynamics and future opportunities.

Notable Quotes:

• Melissa Lee [00:00]: "Rising tensions, President Trump with some very early morning social posts as trade negotiations with China remain strained."
• Megan Casella [03:22]: "US officials have said that it's needed at this point in order to get those bilateral talks back on track."
• Steve Grasso [04:48]: "I'm going to say this, I'm going to probably regret it, but the market is no longer terrified."
• Jared Holz [29:32]: "Once we see what that looks like, I think this is the next one of size to go."
• Melissa Lee [22:02]: "Needham cutting its rating on the iPhone make maker from buy to a hold."
• Carter Worth [37:19]: "Waymo is actually seeing exponential growth."

This summary encapsulates the key discussions, insights, and conclusions from the "Fast Money" episode, providing a clear and engaging overview for those who haven't listened to the full session.