← CNBC's "Fast Money"
CNBC's "Fast Money"
Oil Climbs As IEA Releases Barrels.. And RBC’s Lori Calvasina On Markets Next Move 3/11/26
00:43:33
Stocks ticking lower, as crude oil edge higher after the IEA announced it would release a record 400 million barrels of oil to address the Iran War supply disruption. The latest developments out of the Middle East, and how global markets are responding. Plus RBC’s Lori Calvasina lays out how she’s navigating the volatility, and where she sees putting money to work. Fast Money Disclaimer
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What does it mean to live a rich life? It means brave first leaps, tearful goodbyes and everything in between. With over 100 years experience navigating the ups and downs of the market and of life, your Edward Jones financial advisor will be there to help you move ahead with confidence. Because with all you've done to find your rich, we'll do all we can to help you keep enjoying it. Edward Jones, Member SIPC Live in the NASDAQ markets out in the heart of New York City's Times Square. This is fast money. Here's what's on tap tonight. A historic move to increase oil supply not doing much to immediately lower prices. And stocks are feeling the pressure from those higher energy costs. We'll break down all the action. The impact on everything consumer and housing related and credit crunched asset management stocks sinking again today as private credit concerns continue to rip through the market. The outlook for these stocks and what our guest traders heard at our company's financial services conference this week. Plus, did Oracle give the all clear for software stocks? What's got Uber shares driving higher today and all in on Caesars. The casino name popping. Reports of a new bid from Tillman Fertitta. The details and whether you should bet on the space right now. I'm Melissa Lee. Come to you live from Studio B at the nasdaq. On the desk tonight, Carter Braxton Worth, Dan, Nathan Gaidami and Laurie Calvert, head of US Equity strategy at RBC Capital Markets. Always great to have you, Laurie.
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C
Thanks.
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B
We start off with the choppy action on Wall street today. The S and P closing just below the flat line while The Dow lost 290 points. The NASDAQ managing to eke out a gain for its third straight day in the green. The energy trade still front and center amid the conflict in the Middle East. Crude crude oil prices making a comeback from yesterday's 12% drop rising well over 4%. WTI settling above $87 a barrel while Brent, the global benchmark, nearly hit $92. RB and gas oil also sharply higher. Energy stocks higher as well, leading the S and P up 2 1/2 percent. The jump coming even after the International Energy Agency said it would release a record 400 million barrels of oil to mitigate supply disruptions. Also this afternoon, President Trump saying he will tap the U.S. strategic Petroleum Reserve to lower energy costs. Eamon Javers has some of the details there.
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A
Eamon, take a live look here. The president is speaking in Hebron, Kentucky right now. It's a campaign style speech. He's talking about jobs and the economy. But we're going to monitor it to see if he follows up on these comments on the Strategic Petroleum Reserve. There you see the president in Kentucky. He's talked to a local TV station in Cincinnati on his way to this event and that's where he made those comments about the strategic reserve. He said he'll draw it down a little bit and then he'll fill it up later. He didn't give any specifics in terms of the amounts. But earlier today, the president also talked
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D
about the impact of the Iran war
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A
on the stock market and on oil prices. Here's what he said in Cincinnati.
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E
The market's holding up well. I figured we'd be hit a little bit, but we were hit probably less than I thought. And we'll be back on track at a pretty short while. Prices are coming down very substantially. Oil will be coming down. That's just a, that's just a matter of war. That happens very, you can almost predict it.
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A
So the president predicting a rally here at the point at which the military action ends, but not giving us a whole lot of guidance on when that might be. White House Press Secretary Caroline Levitt saying yesterday that the president just reserves the right to end this when he sees fit, when he determines that the military objectives have been reached. So not a lot of sense of, you know, whether this is a couple of days away from concluding a couple of weeks away or even a couple of months. Melissa back over to you, Eamon.
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B
Thank you. Eamon Jabers, so we have the S&P 500 here holding on to 67 and change or so holding on at this level for a long time. And you can be, if you're silver linings, Dan, which you are, you could say the market is digesting and it's actually doing quite well. Given all of the concerns about a build out private credit and now a war and we're still holding in there.
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A
It is doing well. And you know, when you think about just what's going on prior to the war and then what's going on now, it's kind of the same thing. Semis are strong, software stinks. You know, banks kind of joined the party to the downside following alternative managers
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D
that sort of thing.
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A
So like all that stuff is in place. Energy stocks, which guy's been talking about, broke out, you know, two months ago and they hold firm there. So there's a lot of areas of the stock market that act well. But that doesn't mean that the kind of accumulative effects of what's going on with inflation right now. We had a reading here. The market didn't really love that reading that we got this morning on inflation. If you think about the supply chain disruptions that we've had now going back a year ago with the tariffs going back a few years for the Russian invasion of Ukraine and then, you know, Covid, I mean these are things that are not fixing themselves right right now. So when you think about inflation expectations, they're not going lower. We have unemployment that's going higher for a whole host of reasons. And you just mention and AI that's in the back of everybody's head right now. And growth is slowing, right? So two years ago we had GDP at 2.8%. Last year was 2.2%. Now it's supposed to be 1.9%. That's definitely going lower, at least in the near term. So you have a setup that's actually not great for equity performance, in my opinion. And then it's not great for probably earnings and probably margins are peak right now when only input costs are going higher. So in many ways, I mean, the president is right, the stock market is hanging in there. But if some of these other economic factors start to deteriorate more, that can't be supportive of equity valuations here.
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B
Did you all notice how Dan was silver linings Dan for the span of maybe 15 seconds and then switched immediately to regular grumpy Dan. But anyway, that aside, you know what helped Dan?
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D
Maybe if we bought him like, you know, those flamingos, the pink flamingos you put in the yard.
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B
How will that help him?
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D
Make it cheer him up a little bit? But he doesn't have a yard. So this what I'll say the S and P was down five handles today. That's a, that's a non move. VIX is still north of 24. That is not commensurate with an S and P that's not moving. So something's got to give. Either VIX is too high, which I don't think it is, or the S and P is going to start to move, which I do think it will. And we'll talk about the bond market, but the fact that now 10 year yields are back above 420 that to me is signaling some red flags out there that the market's not paying any attention to. So you know Carter will correctly say we've been there before but to me it's rate of change and where it's going. And the bond market is signaling something.
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B
What will you say Carter?
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E
So many subjects. I mean the market, there's the temptation to think and we all know that it has to be in a direction, right? And that's the case with most stocks. Are you getting better? You worse? Earnings are going up, you're down things your products are working not worry. The market just happens to be in a period of equilibrium. Even though under the surface we've got extreme bifurcation, right? Extreme strength, extreme weakness. It's unsch. What we do know is that the two or three most important sectors are under a lot of pressure. Financials down more than 10%, tech down. The top five sectors of the 11 which account for 70% of the weight are all down. And so whether energy is up, who cares? Three and a half percent might be good if you own energy. But even that sideways for almost 7, 8 sessions as crude has spiked, it should be in principle with a flat bench a stock pickers market and that's essentially what it is.
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B
You have not changed your price target for the year on The S&P 500, you're just pat, right?
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C
And we've actually changed our methodology this year. We're doing a rolling 12 month forward target. But the reality is that we've been pretty balanced throughout this whole thing. And I will give you a silver lining, silver lining playbook. I think that one of the things that happened on the way to coming to this Iran crisis is that we got to a really interesting point on US versus non U S valuations. We published this in our weekly on Monday but we actually saw last week after the market had gotten hit a little bit that you had gone back down to the 20 year average on us relative to non us on the relative P E And then if you looked at the post Covid average we had fallen way it. And so you had opened up the door for valuation opportunity in the US for global investors. And we got this crisis in Iran and we hear okay this is the worst for Asia, it's not so great for Europe, it's not great for the US but it's better than the other regions. And so what we started to see was US outperformance and a difficult tape that also allowed the growth trade to stabilize. And I think that's very important because we had gone up into this point where it was all AI jitters, all, you know, kind of the air scare. We put that on the back burner a bit frankly to focus on this crisis. And I think the mechanics the market actually favored some stability in the S
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B
and P. I think that's a good point that not often enough do we look globally in terms of the choices people are making, allocations. And the same thing goes for the bond market. And what is right keeping US bonds in pretty decent shape. I mean right here sort of at 4.21 or so. I mean what is going on in the impact of higher oil prices, higher energy prices on Europe is much more detrimental severe than here in the United.
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D
Carter had a tremendous call the other night on the Cosby and a lot of different things and Tim talks about this all the time. So yeah, there is a relative thing. Obviously we focus here on the United States for good reason, but you have to sort of look relative to what's going on with the rest of the world. I will say though, Lori's been spot on with everything. There are things are definitely cracks out there and we're going to talk about banks and some other things that are concerning. Now, the S and P does not exhibit any of those fears whatsoever. But as Mike Wilson said a couple of weeks ago on Squawk Box, you know, there's a lot of things happening below the surface and typically the last thing to sort of break. He's not calling for a crash at all. But is the s and P500.
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A
Well, you know, the crude oil thing is really interesting, right? So it's not just gas, it's not just jet fuel. There's a whole host of other things, right. So whether it's fertilizer. But I think when you think about a US consumer consumer, you talk about this K shaped economy, right? Well, what is $3 gas on its way to 350 at a gallon? What does that mean? That means a lot to a consumer that's already pretty strapped, right. And so if you have crude oil in the face of these releases, you know, 400 million barrels and maybe there's some other things to get around to. You know, it doesn't really speak to the fact that we're going to be able to fix these supply chains going forward. The idea that we pull out of or stop bombing Iran and that this all goes back to where it was three weeks ago is not a particularly high probability event. Right. So if a US consumer has to deal with the effects of Tariff they have to deal with. And especially a lower earner consumer has to deal with higher health care costs. People keep talking about this tax return season. Well, I guarantee you, if you were the 20 million Americans that just had your premiums go higher or you lost health insurance, that that tax return that you might get in April is not going to be doing you a whole heck of a lot. Especially when, you know, a gallon of gas at the pump goes from $3 to 350. So to me, if you were worried about that bottom part of the K shaped economy and then if you're looking at the top part of it, if just look at American Express, guys mentioned this a lot. You know, it's down 20% from an all time high just in the last month and a half or so. And what are investors saying about consumer right there when you think about that? So I think the consumer across the board could be in a difficult situation, especially the longer that this crisis goes on.
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Although hat to Peter Bocvar on the Casey's General Store conference call, the management said that we don't start seeing demand destruction until $5 a gallon, which is a far cry from where we are right now.
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A
It's like such bs. I mean, there's just no way that that could be the case. You know what I mean?
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B
Like, it was shocking to me.
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A
I mean, it's $5 a gallon once a lot. I love Peter. Peter's the man. He's just quoting. What?
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B
Yeah, it has nothing to do. I'm just saying that Peter pointed it out and I thought it was worth bringing up. But you actually did some research, right, Just in house research about the impact and how analysts sort of factor this in.
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C
Yeah, and I actually wanted to bring that up in regards to Dan's point on the consumer, because I absolutely agree that the consumer. This is not the time for this to be happening with gas prices, given the affordability issues. But you have to put the impact of the American consumer in the context of the stock market. So last week, a couple days after this crisis broke out, I think it was Tuesday and Wednesday and we kind of updated everything Thursday and Friday we went to all of our analysts in the US and we said, we have three questions for you and we want you to assume $100 oil for an extended period of time or higher and a crisis that lasts for more than four weeks, so put that kind of bearish Iran scenario out on the table. And we said we had three questions for you and you have to tell me if the impact is none A little, some, you know, kind of mixed, not relevant, some, a decent amount or a lot. So there are five choices that they had. If you looked at the broader market ex energy on the earnings question we asked them what's the impact of higher oil and natural gas, 72% were in low impact categories, none mixed, not relevant, only a little. And we saw that similar stats. If you looked at our questions on knock on effects and if you looked at our questions on revenue impact from the Middle East. Now the two sectors that jumped out as having, you know, kind of more significant impact. One was consumer staples which has been pretty weak today. I found that very interesting. And another was materials. Consumer discretionary also scored very poorly on knock on effects. But sectors like comm services, health care, utilities, even financials, very, very low impact was assessed. And I think that mix is something else that can allow the market to be resilient in here.
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E
I mean the consumer discretionary sector is such an odd thing, right? With three stocks being half the weight. Right. Amazon, Tesla and Home Depot. But if you look at the equal weight S&P 500 consumer discretionary sector, relative performance to the S and P you're talking about, we're at 20 year lows. The consumer from what I see is not in great shape. Right. Autos have been great, but we know how poor restaurants have been and a lot of individual retailers as an area I would be underweight the space.
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B
Yeah, I mean we should get an interesting read on the lower end consumer tomorrow from the dollar stores, dollar general. So I'm sure that the consumer in terms of rising gas prices that will come up 100%. But it does seem that in light of all the other things, like if you take a look at consumer spending as a pie and more of that pie is being eaten up by housing because housing affordability is so terrible, then gas price is a higher percentage of the remaining pie, even though it's.
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D
Yeah, I mean, you know the. Well, I find it interesting. People think nothing of spending however much on a bottle of water or Starbucks. It seems like there's an elasticity to it. But something about gas prices, when people see it, they react to that and that affects consumer behavior. Whether it's justified or not, that goes on. And when people start to see in the tick up, when they see the guys and gals at the gas station change in the prices, they start to say, hmm, maybe things have changed here and consumer behavior is a powerful thing. And this is an economy 70% driven by said consumer who are already under pressure and a Labor market that I think is deteriorating. This does not help the situation.
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B
Rising oil prices also having an impact on the housing trade. Fears over the higher costs for paint, plumbing, flooring as well as pressure on potential homebuyers, sending the ITB Home Construction ETF down for an eighth straight day, its longest losing streak since the end of 2024. All this coming at the start of the spring selling season. But our next guest isn't worried just yet. Joining us now, Logan Motashami, lead analyst at Housing Wire. Logan, great to have you with us.
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F
It's good to be here.
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B
10 year yield at 4.21%. I mean, is it really, is it just focused on the mortgage rate? If the mortgage rate stays tame or around where it is, then it's going to be okay. Or are there other concerns out there?
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F
You know, it's the best start for the existing home sales market we've had in years. But it's also because mortgage rates have been below six and a quarter and very, very calm this year. Even with all the crazy headlines, private credit, AI, Iran, war, oil, everything. Mortgage rates have started the year at the lowest levels we've had in years and demand has picked up to go with that. Now if mortgage rates start to go back above 7% and mortgage spreads get bad again, that's a whole different story. We've had that in the last three years. Home sales start to decline on that. But as of today, even with all the drama, housing market looks fine, especially in the existing home sales market. The builders have other problems if they have too many completed units of sale right now. So you're not going to get much growth in housing starts. But the existing home sales market looks to have a good year this year.
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B
The band though between below six and a quarter percent to the seven percent that you mentioned is a long way. That's how much cushion there is in terms of it being okay for the housing market.
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F
Mortgage spreads are the unsung hero of the housing market this year. And last year they have mortgage spreads which is the difference between between the 10 year yield and 30 year mortgage was over 3% in 2023. Now it's under 2%. So it's very hard for mortgage rates to get above 7% unless the labor market is going to start growing again or inflation is just there's too many input costs rising. So I don't think we have that problem. I think for now, as long as the volatility is compressed and mortgage rates stay near 6%, we're good this year for the existing home sales. The builders on the other hand, it's really a corporate profit margin story for them. They need to keep paying down rates to move product. That's they sell homes as a commodity which is different than the existing home sales market. So for right now, two tails of different markets advantage existing home sales this year versus what the builders have to deal with.
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D
Logan, we talk about rate of change a lot and I'm not suggesting a 4 1/2% unemployment rate or wherever it currently is, is and in dire straits. However, if it starts to move in a precipitous way, people's antenna go up. What's the magic number in your opinion where the housing market starts to take notice?
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F
You know, oddly enough when, whenever the, if the unemployment rates rate rise, rates tend to fall. If the unemployment rate rises, rates rise. That's a detriment to the housing market. But if you look at the history of existing home sales going back decades, it actually tends to outperform when there is a recession because rates make that next leg lower and stay there. And since majority of homeowners and home buyers and home sellers that will be buyers are employed, advantage to the housing market in that front. However, if the job market doesn't do anything like it has in the last 12 months and inflation starts to pick up and bond yields go up, that's a negative for the housing market. So oddly enough, it's a weird thing to say. If the labor data starts to get worse, the Fed will start to get more dovish, bond yields will kind of go down. That's the story of last year, right? You know, inflation was picking up but mortgage rates went lower. So to me it's more about if the 10 year yield stays low, if it starts to pick up and spreads get worse, that's a detriment to the housing market. Even if the unemployment rate went lower.
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C
This Laurie Calvert, one question for you. How are you thinking about this moment where we are in terms of consumer sentiment and consumer confidence where the indexes have been pretty lousy, look like they've been trying to stabilize and now we're throwing, you know, this gas price Middle east issue on top of it. I'm wondering how that kind of factors into your broader thinking.
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F
I mean the consumer sentiment has been terrible for some time, right? So it's, it's now you would think if it sentiment is going to change behavior then people wouldn't be implying or running the purchase application data higher this year. Purchase application data has been positive year over year, every single week even with the headlines even with Iran oil. So to me it's always going to be a 10 year yield and mortgage spread story for housing even more than sediment. But again we are at the lowest levels of rates for some time. That story could change like this. If oddly enough the labor data gets better and inflation picks up, the Fed gets more hawkish in that context, that would be a negative, more negative story for housing than the consumer confidence data here.
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B
Logan, great to see you. Thank you.
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E
Pleasure.
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B
Logan Mohtashami all right, so if it's all about yields, Carter, what do you see for the 10 year yield?
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E
We're stuck. It's, you know, it's the incredible, it's the incredible thing that will either get down into the mid threes nor get back up into the high fours and low fives. It's what a pair of twos is and it's one of the reasons that equity valuations have remained so high. Ultimately I'm in the lower yields camp and we shall see.
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B
So that is actually good then for the housing trade potentially.
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D
So pull up a couple of charts our crackstaff and can effort this look at Leonard Pulte Homes, Toll Brothers over the last six to nine months and you'll see these stocks have not traded particularly well in a benign rate environment. So there's clearly something going on and I think these homebuilder stocks are just getting started to move to the downside.
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A
Yeah, you have input costs going higher. Not you know, labor is a big part of that too. Right. So if you want to stretch out that disruption in the straight of her muse, there's a lot of different ways that you can kind of go that way. So to me I think guys been saying this, he thinks rates are going higher and they haven't gone anywhere like it's been a pair of twos. They've been banging around between four and four to five or something. But it really does feel like that if we continue to see this sort of move. I don't know why you would have thought that. Usually, you know, you see rates go lower and then for demand for Treasuries, but they're moving higher and they really look like they want to go break that downtrend that's been in place four and a half. Maybe you have a view on this. Four and a half in the ten year. What does that mean for equities that are held in here Pretty well.
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C
I was actually going to jump into that. So one point on that, one point on homebuilders and I'll say On home builders real quick, they tend to act like small caps. And we've actually pulled back on our constructive view on small caps, saying as long as we're, you know, dealing with heightened tension, small caps are going to be in risk off mode. I think that filters into the home builders as well. But we actually ran a stress test last week where we put in 3.6% inflation for 4Q, which is my economist stress test for $100 oil. And so we put that into one of our equity valuation models where we bake in 10 year yields in fed funds in addition to the inflation rate to come out with a. And I struggled a little bit with what to do with the 10 year yield number. I put it in at four and a half percent. I kept the Fed flat, it cut the multiple by a couple points. But I'll tell you what, when we had flat earnings similar to what we saw in 2015, 2016 and 5% earnings growth, which is what we saw in 2022 during the last big oil spike, we came up with a fair value range on the S&P 500 of 6600 to 6900, which is exactly where we've been hovering. And to your point.
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F
Point.
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C
You know, the fact that, you know, I'm debating with my rate strategist if 4 1/2% even makes sense because he thinks it could potentially be lower. You know, that is giving a boost to equity prices as well.
- [22:20]
B
I wish I had a model like that. Plugs different assumptions in. Right? Amazing.
- [22:25]
C
You don't want to know. You don't want to know the story
- [22:27]
B
behind how I built Claude.
- [22:29]
E
Cowork.
- [22:30]
B
We'll get you not called Claude will
- [22:32]
A
be in a year. Hopefully your juniors.
- [22:35]
C
It's called Lori. Lori.
- [22:36]
B
Real hard work.
- [22:37]
D
Can we just say who are the.
- [22:39]
A
We gotta go. She's the real
- [22:43]
C
intelligence.
- [22:43]
D
How long have we been doing this show?
- [22:45]
B
I mean the show. It's 19 years.
- [22:47]
D
19 years.
- [22:47]
B
Yeah.
- [22:48]
D
Logan had the best hair shirt combination.
- [22:51]
B
Oh, the hair.
- [22:52]
D
In the history of fast money. That silk shirt with that hair, I mean that was hot.
- [22:57]
A
It was hot.
- [22:58]
B
I hope Logan is hearing this.
- [23:00]
D
He hears every word of it.
- [23:01]
B
Coming up, a divine day for Oracle shares surging on the back of strong results. Can the games hold and will they help lead a software rebound? That is next. Plus the latest partnership in the robo taxi space. While Uber is teaming up with Amazon's self driving company. And how your next ride may look a little bit different. Don't go anywhere. Fast money's back in two.
- [23:22]
D
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A
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- [24:05]
C
Not every sale happens at the register.
- [24:07]
B
Before AT&T business Wireless, checking out customers
- [24:10]
C
on our mobile POS systems took too long. Basically a staring contest where everyone loses.
- [24:16]
B
It's crazy what people will say during an awkward silence.
- [24:19]
C
Now transactions are done before the silence takes hold.
- [24:22]
B
That means I can focus on the
- [24:23]
C
task at hand and make an extra sale or two.
- [24:26]
B
Sometimes I do miss the bonding time.
- [24:29]
C
Sometimes.
- [24:29]
A
AT&T business Wireless connecting changes everything.
- [24:37]
B
Welcome back to Fast Money. Oracle shares rallying after last night's big earnings. Beat the software giant impressing the street by raising revenue guidance, posting massive cloud revenue growth and saying it doesn't expect to issue more debt to fund its expansion plans. Oracle also mentioned the stronger capital footing of some of its biggest partners. Open Air just announcing a $110 billion funding round at the end of last month.
- [24:57]
F
Month.
- [24:57]
B
So did today's move give the go ahead for the software trade? What do you think?
- [25:02]
A
I think a lot of folks who were set up long this as a trade into it were obviously selling into it. I think you got like a nice 10% trade. I think the sentiment was so poor. I think the company did just as much as they needed to do. But when you start picking through it and you start saying to yourself, okay, well we're going to build these data centers and we have, you know, one of our biggest customers who's actually not fully funded. They raised 110, I'm doing that billion. It's going to be pieced out over a period of time. And you know what one of the big investors were that was Softbank bank and they don't have the money also too. So all this stuff needs to continue to be funded. And so I say to myself, I don't think much has changed and your revenue number that you're guiding up. Well, if you have a half a trillion dollar in backlog or RPOs or whatever, you better be guiding revenue up or it's just going to be all on the come. So to me, I think it's set up as a good trade. Let's see if it can kind of hold this level. It really feels like it wants to fill in that gap though.
- [25:51]
B
By the way, Oracle is a software name by I don't know, but it's not really. I mean the strength that we saw in today's session is not because of the strength in its software business. The strength of the business. So you could make the case that strength in that business that is under build out is firm, etc. That's actually bad for the software sector in terms of the fears of displacement of software and from a margin by
- [26:15]
A
the way for this company.
- [26:16]
B
Right, for a margin.
- [26:17]
D
And actually Dan alluded to that last night. He said seems to be more of an Oracle specific thing and you're right to point that out. And I actually was thought that IGV could trade well today it did not. It closed unchanged on the day. I will say though, I still think IGV put in a bit of a short term bottom here against the lows we saw last April and I do think Oracle has some legs left on the upside. I think the pessimism around the name over the last three months is akin to the optimism we saw in the fall and it's going to level out at some point. I think it's in the 190 by the way.
- [26:46]
B
Atlassian in an SEC filing this afternoon saying that it's going to cut 10% of its workforce, blaming in part AI and the mix different mix of skills that will be needed going forward in its workforce.
- [26:58]
C
It's interesting. I mean 10% is what I think the Challenger layoff report said has been attributed to AI in terms of layoffs year to date. So I know that sounds like a bad number but it's sort of similar to what we've heard so far. If I could just weigh in on software real quick and taking your point about the second specific company. But when we kind of zoom out and look at the broader Russell 3000 software industry group and compare it to semis, if you look at the relative P E between the two, you've been, you know, I've kind of described it as like an eighth inning, you know, sort of low. I mean we're not quite back to financial crisis lows, but you're pretty darn close. And if you look at software on its own, it's that PE has sort of hit some important, you know, kind of lows of the past ten years or so. So you can make a case from a valuation perspective to hold your nose and buy. I get a little bit more cautious when I look at earnings revision trends because we've sort of gone from peak rates of upward revisions in software down to kind of like balanced between upward and downward. You haven't really had a downward revision cycle yet. Sometimes that happens in these charts. I'm sort of waiting to see how that earnings revision data does.
- [27:58]
E
I mean, look, software has been basing and bottoming for a better part of three weeks. This helps set the low for Oracle. But, you know, the headlines read, Oracle surged 15%. You could say this. There's different headlines. Oracle, which was down 57% going into earnings, is now down only 53% from its peak. I mean, you know, it's the story you want to tell, right?
- [28:16]
B
I love Carter's headlines. A lot more fast money to come. Here's what's coming up next.
- [28:21]
A
Why your next Uber ride could look a little bit different. The partnership with Amazon that could change the way you ride and what it means for the robo taxi race, plus financial woes and the private credit crunch. RBC's Lori Calvacena isn't throwing in the towel on her market bull case, but what does she see in the asset manager meltdown? You're watching Fast Money live from the NASDAQ market site in Times Square. We're back right after this. Hey, this is Jeff Lewis from Radio Andy live and uncensored.
- [28:57]
F
Catch me talking with my friends about
- [28:59]
A
my latest obsessions, relationship issues and bodily ailments. With that kind of drama that seems to follow me, you never know what's going to.
- [29:06]
B
You can listen to Jeff Lewis live
- [29:08]
C
at home or anywhere you are.
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B
Download the SiriusXM app for over 425 channels of AD. Free music, sports, entertainment and more. Subscribe now and get 3 months free offer details apply.
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Before we had AT and T Business Wireless coverage, our delivery GPS wasn't the most reliable. Once our driver had to do a 14 point turn to get back on route. A 14 point turn. An influencer even livestream the whole thing. Not good for business. Now with AT&T business Wireless, routes are updating on the fly and deliveries are on time. And the influencer did get us 53 new followers though at&t business Wireless connecting changes Everything.
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B
If you're a parent and want to help set up your child for success, then IXL is right for your family. As an effective and affordable online learning program. IXL covers math, language arts, science and social studies using interactive practice problems for kids from Pre K to 12th grade. Listeners can get an exclusive 20% off IXL membership when they sign up today@ixl.com 20. Visit ixl.com 20 to get the most
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A
effective learning program out there at the best price.
- [30:28]
B
Welcome back to Fast Money. Uber shares hitting the gas today. The ride hailing company announcing it will partner with Amazon's Zoox Robotaxi unit to offer rides directly on its app beginning in Las Vegas this summer with rollout in Los Angeles slated for next year. It's the latest step in Uber's Robotaxi push. The company already has driverless options in Atlanta, Austin, Dallas, Austin, Dallas Phoenix, and aims to expand to A total of 15 cities delays by the end of the year. But this just proves that Uber is not displaced in this whole Robotaxi push. It is a key component of it.
- [30:59]
A
Well, they also have the thing that, let's say Tesla doesn't have or you know, they have this app where they have, you know, like millions and millions of very happy customers who actually Uber things like we Google things, that sort of thing. So they're going with an asset light strategy right now before it's actually well known whether this is a business that scales. So I like this, if I'm an Uber investor, like this is what I want to hear. I don't want to them, you know here that they're going to go build out this robo taxi fleet which no one wants to own those things.
- [31:26]
D
Yeah, 30% earnings growth. It trades at a decent multiple. I mean, I think you get a couple turns on the multiple and the average price according to facts, it's 105. And I think it eventually gets there. It's had some pitfalls along the way. Every time there's a headline about Waymo or something, Uber seemingly goes lower. But I think when people sort of piece it together and realize that valuation wise, it's compelling. I think if the stock goes higher. By the way, what is this thing? Zoox?
- [31:51]
B
Yeah. Did you see the picture of the.
- [31:53]
A
Can we put it up?
- [31:54]
D
We have it. There's a crack.
- [31:55]
B
It doesn't look like a car. It looks like a little box on wheels. What it's time to see.
- [31:59]
D
Look. Oh, come on people. That's, that's here in the United States. Born they have an SF guy. I mean that's like you just basically said I've given up. Like that said I've got a golf cart. It's like don't succumb. I mean do we have is anything.
- [32:15]
B
Huh.
- [32:16]
D
There's a lot wrong with it. I mean I love the Uber the stock but I ain't getting one of
- [32:20]
E
those things where the stock though is that, I mean, down 30% from its peak of September. Relative performance is poor. There's better choices, I would say better
- [32:29]
B
choices for the stock and for the vehicle.
- [32:30]
E
Better choices just for just in general. Yeah.
- [32:34]
B
Financials under pressure, credit concerns and the
- [32:37]
C
war in the Middle East.
- [32:37]
B
How RBC's Laura Calvert here is navigating all the headwinds and we're still sees the biggest opportunities right now. Fast Money's back into
- [32:47]
A
Missed a moment of fast. Catch us anytime on the go follow the Fast Money podcast. We're back right after this.
- [33:00]
B
Welcome back to FAST money. Stocks closing mix as crude prices continue to edge higher despite the IEA releasing a record 400 million barrels of oil amid the Iran war supply disruption. The dow falling nearly 300 points. The S and P and NASDAQ virtually unchanged. WTI crude settling more than 4% higher. Shares of Nike rising more than 2% at the start of the day, but losing steam, closing out negative territory. Analysts at Barclays upgrading the stock to an overweight, hiking the price target to $73. That's up from 64, citing recent operational progress and a more attractive risk reward. And shares of Campbell's falling 7% after missing top and bottom line estimates. Estimates this morning. The company also cutting its annual forecast as consumers shift to cheaper alternatives. Campbell's down nearly 18% so far this year. Meanwhile, more pain in the credit trade areas. Management dropping almost 5% today. KKR Blackstone in Apollo also under pressure. This as JP Morgan reduces its exposure to the space, marking down loans held by the bank as collateral. The stocks now off nearly 25% or more this year. So brace for more trouble ahead in private credit. I don't know. What are your thoughts here?
- [34:07]
D
It feels that way. And again, it might have nothing to do with fundamentals, but once sort of the narratives in place, it's very hard to change the narrative. And I will say again, the blue out thing, once you heard the word gates around it, that got everybody's antenna up. Now they were able to sell $1.4 billion of assets or whatever you want to call them at 99.7%. So, so there was no real concern in terms of how we would sell it. But everybody heard that word and now everybody's focused on it. Then you hear the comments out of Jamie Dimon at JP Morgan. We hear from Goldman Sachs today and it starts to build on itself. Pull up an XLF chart and you'll see, I think now we're below the 200 day moving average for the first time in a while. So it started with American Express. Obviously, it's made its way to private credit in the form of these blackstones and other names. And I think it's just a matter of time before the big banks get hit as well.
- [34:53]
A
So when you think about what Jamie Dimon just said a few weeks ago about some of their competitors are doing dumb things, right? So you see what they did today, right, with their lending to private credit.
- [35:02]
B
Okay.
- [35:02]
A
And then you think back, it was about a few weeks ago also when bank of America said they're committing $25 billion of their own capital to lending in the private credit space. So just think of the juxtaposition of what's going on right there with what Jamie Dimon is doing. Go back and think or think about what bank of America was doing. Remember when they were like loading up on Treasuries when you know we're at
- [35:23]
B
zero, that's America's doing yet another dumb thing once again. Yeah, it's basically.
- [35:28]
A
Well, it's kind of what Jamie is alluding to and I'm just going to agree with him.
- [35:31]
B
Well, you're connecting the dots. Jamie didn't actually say. He said some competitors. But you're actually pointing out bank of America as potentially that dumb competitor.
- [35:37]
A
Well, I just, it's like the oddest, like, headline, like when everyone else is, you know, like, pulling back. These guys are going to get all involved. It's like them buying Countrywide. Well, it was Merrill lynch, like in the 2007.
- [35:48]
B
What are your thoughts on this space? You're just coming off a big conference and I'm sure this has come up.
- [35:53]
C
Yeah, no, and look, we had a BDC panel at the conference yesterday that was, you know, standing room only. And I think they couldn't even close the doors. And look, you know, I think Guy, you. How did you put it that once the narrative's out there, it's hard to change. I think that hits the nail on the head. And you know, Ken Lee, who's our BDC analyst, did a really nice write up on that panel yesterday and he, you know, he talked about how the companies are really defending their portfolios. You know, talking about software, you know, kind of making the case that not all are susceptible to AI, you know. And I think the other theme, right, that he mentioned was the idea that there's a disconnect between the headlines and the fundamentals that all these companies are seeing, right. The problem that I see from my seat, right, is we've been hearing this time and time and time again and I think to you know, Guy's point, this is not an industry that inherently has a lot of transparency and sunlight, right. It's not what we're used to in public equity. So it's kind of hard to disprove the narrative that's out there. I want to give you a sense of starting point and let's put this in context of what we talked about with software earlier. So software, you know, kind of rock bottom valuations relative to semis. You may not like the fundamentals, but sure, they've been beaten up a lot. If I look at the capital markets group within the Russell 3000 financial sector, it's this little bastion of like everything risky. So it's got investment banks, not regional banks, but investment banks banks, it's got all the crypto retail trading firms, it's got asset managers, which I know are a little bit sleepier. And then it's got the alternatives, right? And if you looked at the valuation on this relative to the broad market late last year, early this year, you're just at this crazy high level, right? And it's come down and it's come down to average but it's not near, you know, any kind of historical low where you can look and say it's washed out. And so I think that's. You've got a problem of narrative and you've got a problem, yes, there's been weakness, but maybe it's not enough to start to move past some of these things.
- [37:40]
E
Well, let's see. We know it's the second most important sector by weight and we know that it's been under pressure for quite some time. First it was insurance stocks. Those have been peaked over a year ago. Now it's these huge high flying private equity stocks all down 50%. Now Goldman's rolling Morgan Stanley JP on a relative performance basis the sector is making all time lows since the beginning of, of GICS sector data in 1989. So the absolute low was 09 financial crisis. We touched that low on a relative basis again in 2020. Covid and we are right there again. I mean it's, it's just not a great space over Time highly cyclical. To some extent, risk management is better and yet it's never quite good enough.
- [38:22]
B
How, at what point though, Carter, does that assessment turn from that to it's so bad it's good?
- [38:28]
E
Sure. Remember, that's relative performance. Okay. Absolute performance. The sector is coming off an all time high. Right. We've only rolled a slight bit, but the fact is that we're now breaking trend. 150 day moving average is turning over. It has all the elements of something that I would say can get worse.
- [38:43]
B
Coming up, gambling on Caesars, another billionaire reportedly bidding on the casino operator. The two names fighting for the firm and who's closer to winning the pot. The details when Fast Money returns. Welcome back to FAST money. Caesars popping late in today's session, billionaire investor Tillman Fertitta's firm reportedly in talks by the casino operator for roughly $7 billion after topping a bid from Carl Icahn's firm, Contessa brewers here with all the details. Why this bidding war for this property?
- [39:15]
G
Well, because the price is right. Come on down. I mean, you know, the public equities market thinks that this is a bunch of crap stuff so that they've been punishing casinos. And what you have is two billionaires in here going, nope, we're going to throw off. You know, Caesars has a billion dollars a year in free cash flow.
- [39:35]
B
That's not nothing.
- [39:36]
C
Okay.
- [39:36]
G
You come to the table with that. They've got something in the neighborhood of $4 billion a year in EBITDA. And they're trading right now, closing price right now $26 a share. It's basically back to where it was way before the pandemic, getting no credit for the pop that they saw after the pandemic. So the report from the Wall Street Journal hit today that Tillman Fertitta has come in at $34 a share. That would put a value of the deal at $7 billion. A 64% premium to where the stock was trading before. The FTSE said that Tillman had some interest there. By the way, I did ask him back then to comment and he said you just say Tillman always talks to you and I'm not talking to you. I've reached out to Carl Icahn. I have not heard back. I've reached out to Caesars. They said we don't comment on rumors. So, so there you have it. Now you have an icon offer reportedly at $33. What I have learned from sources close to this situation is that the details in the Wall Street Journal report are very close to actually what's happening. So look, Icahn owns right now 5% maybe with forward somewhere in the single digits markets. If Tillman comes forward and pays more than that, Icahn makes money, it's sort of a win for him. It's not clear that the digital spinoff is part of this right now. Digital has been under pressure, so and Vici, by the way, the landowner In Vegas and 20 other properties, it doesn't have a say in the deal.
- [41:01]
D
Contesta breaking it down a lot better than I can, which is not hard to do. But I will say this, I mean the shareholders at least the board can't be thrilled about this price, I don't think. I mean pulp a longer term chart, you'll see where it's been. Not that that means anything, but this is the pressed asset and you're getting it on the cheap. So what I think is going to happen here, you know, Carl has a vested interest for this stock price to go higher. So I think they'll play the bidding game. This could play out for a while. This is going to be like a Netflix, Paramount, Warner Brothers thing that's sort
- [41:29]
B
of a little dangerous of a game if all you want is, you know, what stock price to go higher so your state can be worth more.
- [41:34]
D
Think about the seat that he's in where he is in life. I mean, that's a game that I think he would enjoy.
- [41:38]
A
This company has like she just said, $7 billion. It's got $25 billion in debt. I mean like it's upper left, bottom right for, for a reason. And so I don't know, I mean like have it people.
- [41:49]
G
But the other, other people close to this say this is not the only company. If you look at these gaming companies in general, look at how much money Wynn is making and where the share price is. Look at Las Vegas. Sands has the most lucrative casino in the world in Singapore. It's doing gangbusters. The share prices just, just sitting right here. Mgm the same. This is just an area right now that doesn't have a lot of favor with stock investors. So are you going to see more toying with the idea of taking them private?
- [42:19]
B
Right. Any possibility that if not Caesar's that another property out there for either party? Well, not for Carl because he already has a stake in Caesars.
- [42:30]
G
Okay, but look at Tillman Fertitta, which he owns the Golden Nugget gold nugget. He's one of the largest shareholders, if not the biggest in DraftKings. Already sold them Golden Nugget online. He owns 12.5% of Wynn Resorts. So here's a guy who really loves gaming. Is he going to find value in what? Maybe he's going to go and look at mgm. Maybe. If you want to be on the Strip, that's where you go next.
- [42:52]
B
Thank you, Contessa. Contessa Brewer. Coming up, insurance can get technical, but good thing we've got the chartmaster here to help break down the name Nitty Gritty. What are you seeing in Progressives chart? That's next, More fast Money. Welcome back to Fast Money. Shares of insurance company Progressive have had a bumpy start to the year, down nearly 12% since January. And the chartmaster saying it is time to sell. Carter, what do you see?
- [43:20]
E
Well, and it's not just Progressive. The whole group is under pressure, but it's the worst of so many insurance auctions. So a couple charts. They're always identical in terms of duration, but we put different lines. So let's first do this. This is a fairly well defined formation, which we're going to look at later, but moving forward. Next chart, you'll see the same chart, same setup. It's this current setup we're toying with. And just now about to break out of this minor formation. Take a look at the next iteration. Another way to draw the lines, but similar again. We're about to come out to the bottom side. At least that's my judgment from this formation. Let's look at another iteration, bringing this line all the way back. We're about to break an important trend line. And so the final one would be you'll put the head and shoulders back in. And this is a precarious kind of thing. So again, I think we're at risk here of a big break and not good. And if you compare it to Hartford, you compare it to Allstate and other Chubb, something's not right. Sell Progressive.
- [44:26]
B
Does anybody like insurance?
- [44:28]
D
You know, real quick on this chart, this was a parabolic, but you don't see moves like this in this sector. I mean, pull up the chart, the longer term, and you'll see what I'm talking about. I mean, the Stock went from 130 to 250 almost in a straight line. So I'm with Carter here. You know, you look at the formation, the valuation is not compelling. I think he's right. And I'm looking at the level. This could easily get bad to a buck 50 or so.
- [44:48]
C
Look, I can't speak on any individual name, but on our work, the broader Insurance group does look pretty cheap and still has good earnings revision trends. Now it is in the financial sector, right? Which is a sector I do like longer term but is seeing some outflows right now. So you can get a situation where the baby gets thrown out with bathwater in the short term.
- [45:05]
D
That's. I mean, think about that. Who would throw numbers?
- [45:08]
B
I mean, I don't see how you can make that kind of a mix mistake.
- [45:11]
D
That's an odd mistake to make.
- [45:12]
A
I think during the plague or something they used to throw their babies out with a bath water. They lost a lot of babies.
- [45:17]
B
Really?
- [45:17]
A
No, I don't. I think that something like that defenestration
- [45:21]
E
or what was going on.
- [45:22]
A
Let's be clear, no babies were hurt in the filming of this show. But back then, maybe, who knows.
- [45:27]
B
Anyway, up next, final trades. Time for the final trade. Carter Braxton, Worth.
- [45:44]
E
I think you've seen the high in oil and I would fade it.
- [45:47]
B
Lori Calvina.
- [45:48]
C
I like healthcare. It's cheap, it's got low Middle east exposure and good earnings.
- [45:53]
B
Great to have you, Lori. Thanks for coming by, Stan.
- [45:57]
A
All right, the optimistic take is that guy's probably writing software made a bottom but I think you can sell sex against it. I know that's been a trade card of mine too.
- [46:05]
D
Couple things, John Justin Alaysia, the rock star. Look him up, go to the Google machine and check him out. He's actually here watching the show. There are a lot of people in Wichita, Kansas right now, a bunch of states.
- [46:17]
B
Really? In Wichita?
- [46:18]
D
Yes. I can't drop names, but Wichita, Kansas in the house. All right, Valero, I'll take the other side of Carter work.
- [46:26]
B
Thank you for watching. Fast Funny. See you back tomorrow. Mad Money with Jim Cramer starts right now. All opinions expressed by the Fast Money participants are solely their opinions and do not reflect the opinions of CNBC or its parent company or affiliates and may have been previously disseminated by them on television, radio, Internet or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Fast Money participants consider reliable. But neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Fast Money disclaimer, please visit cnbc.com fastmoneydisclaimer Martha listens to
- [47:05]
F
her favorite band all the time. In the car, gym, even sleeping. So when they finally went on tour,
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A
Martha bundled her flight and hotel on
- [47:15]
F
Expedia to see them live. She saved so much, she got her seat close enough. Enough to actually see and hear them. Sort of. You were made to scream from the front row. We were made to quietly save you. More Expedia made to travel. Savings vary and subject to availability. Flight inclusive packages are atoll protected.