Stocks Drop, Yields Rise… And Retail Picks Ahead Of Results 5/15/26

Summary

CNBC Fast Money — Episode Summary

Episode: Stocks Drop, Yields Rise… And Retail Picks Ahead Of Results
Date: May 15, 2026
Host: Melissa Lee with Tim Seymour, Karen Finerman, Steve Grasso, Michael Koch
Notable Guests: Tim Urbanowitz (Innovator, Goldman Sachs Asset Management), Leslie Picker (CNBC), Simeon Siegel (Guggenheim)

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Episode Overview

This episode covers a volatile trading day where stock markets pulled back sharply amid surging global bond yields. The Fast Money team breaks down what surging rates mean for equities—including the tech and AI trade—and discusses strategy as earnings season continues, with retail giants like Walmart and Home Depot set to report. The episode also spotlights Microsoft’s rally on news of a big hedge fund buy, looming layoffs at Meta, and the much-anticipated SpaceX IPO, plus a look into President Trump’s reported stock portfolio.

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Key Discussion Points & Insights

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1. Market Selloff Amid Rising Bond Yields

[01:03 – 12:29]

• Backdrop: Yields on 10-year and 30-year Treasuries hit their highest levels in nearly a year, with knock-on effects globally (Japan, UK, etc).
• Stock Impact: The S&P fell 1%, the Dow lost 500+ points, and the NASDAQ dropped 1.5%. Nvidia’s >4% drop ended its seven-day rally and weighed heavily on major indexes.
• Themes: Concerns that higher borrowing costs threaten lofty equity valuations, especially for leveraged sectors like semiconductors and AI.

Key Quotes:

• “It felt like the Ides of May…these things had been lurking and suddenly they popped out.” — Karen Finerman [02:50]
• “Can equity values rise as borrowing costs rise? …the driver was Japan this week with a terrible PI (Producer Inflation) number.” — Karen Finerman [02:52]
• “Rates themselves are problematic…the trade is built upon a lot of leverage among chips.” — Tim Seymour [03:26]
• “If the 10-year broaches five, that’s going to be a problem, even higher than the four and a half that normally is the problem.” — Steve Grasso [04:48]

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2. Fed Leadership Transition & the Limits of Central Banking

[05:30 – 12:29]

• Fed News: Steve Liesman reports on Jerome Powell’s interim reappointment until Kevin Warsh is sworn in as Federal Reserve Chair, with dissent from some board members on procedural grounds.
• Discussion: The panel debates whether the Fed has any tools left to address current inflation, which is seen as driven by external factors (geopolitics, energy), not demand.

Key Quotes:

• “Some of the inflation data that we've been getting is outside of the Fed's control…geopolitical events are driving up energy.” — Michael Koch [07:11]
• “This is a debt story. I don’t think it’s about the Fed.” — Karen Finerman [08:04]
• “What would raising rates do in this environment? Nothing. They have no control.” — Steve Grasso [11:17]

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3. How to Hedge as Yields Rise: Guest Interview

Guest: Tim Urbanowitz, Goldman Sachs Asset Management
[12:29 – 17:53]

• Market View: Surging above 4.5% on the 10-year yield creates high volatility and fresh pressure on equities.
• Hedging Strategies: Advisors are relying on derivative-based ETFs, buffered and dual-directional products—structuring risk management with options, as traditional plays like bonds/low-volatility equities are underperforming.
• Sector Outlook: Still bullish on emerging markets as a source of growth, despite rate risks. Cautions that a sustained rate surge will hit small caps and high-growth sectors hardest.

Key Quotes:

• “We just crossed a pretty crucial threshold…the more sensitivity you see in equities to moves higher (in yields).” — Tim Urbanowitz [12:48]
• “Energy is a great play…we haven’t seen much progress on the Strait of Hormuz.” — Tim Urbanowitz [13:48]
• “Emerging markets…still seeing one of the widest valuation gaps from EM to the US in decades.” — Tim Urbanowitz [14:51]
• “I think there’s going to be some bifurcation in the markets…small caps (are) more rate–sensitive.” — Tim Urbanowitz [16:25]

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4. Debate: AI, Emerging Markets & Rate Sensitivity

[17:54 – 20:46]

• EM vs. US Exposure: Panel notes that EM indexes are heavily tech/semiconductor-weighted (Taiwan Semi, Samsung, Hynix).
• Caution: Despite structural attractiveness, both small caps and EM are likely to underperform if rates keep rising.

Key Quotes:

• “Higher rates, higher risk. I think emerging [markets] is going to underperform in the short run, even though structurally it is cheap.” — Karen Finerman [18:13]
• “The AI trade…big companies…making investments now in exchange for potential for growth…they’re extending their sensitivity to rates.” — Michael Koch [19:35]

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5. Commodities: Metals Sell Off Hard

[20:46 – 21:41]

• Action: Silver dropped 10%—its worst day since January; gold, platinum, palladium also fell.
• Drivers: High rates make non-yielding assets like gold less attractive. Strong dollar also hurts gold.

Key Quotes:

• “When rates are rising, that’s your competition because gold has no yield to it.” — Steve Grasso [21:04]
• “Best week for the dollar since March, and gold’s not going to perform here.” — Karen Finerman [21:24]

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6. Microsoft’s Rally: Ackman Makes a Move

[23:34 – 26:35]

• News: Bill Ackman’s Pershing Square disclosed a stake in Microsoft; he believes Copilot adoption will accelerate and the market overreacted to earlier concerns.
• Panel Reaction: Favorable overall. Microsoft’s strong enterprise franchises (Azure, Office 365) and relatively low valuation are highlighted.

Key Quotes:

• “He bets big…Microsoft is a very big holding in the IGV (Software ETF).” — Tim Seymour [24:04]
• “If I was going to buy a software company, it would absolutely be Microsoft over the others.” — Karen Finerman [25:13]
• “Trading at a 10-year low in terms of its multiple…now at or cheaper than the S&P.” — Michael Koch [25:57]

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7. SpaceX IPO Approaches — Unprecedented Scale and Governance Concerns

Guest: Leslie Picker, CNBC
[28:44 – 32:35]

• IPO Timing: SpaceX expected to publicly file its S-1 next week, with a $70B offering on a $1.75T valuation—largest ever.
• Governance Pushback: Pension funds are concerned about super-voting shares, CEO control, and lack of shareholder protections.
• Retail Allocation: The company is considering non-US retail placement to avoid excessive early volatility/meme stock dynamics.

Key Quotes:

• “Pension funds…are already concerned about the governance implications…including super voting shares and the inability to remove the CEO unless he chooses.” — Leslie Picker [29:38]
• “The concern is…what does that supply–demand dynamic look relative to the valuation? We've never seen anything like this before.” — Leslie Picker [31:46]

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8. Retail Earnings Preview — Discount Segment in Focus

Guest: Simeon Siegel, Guggenheim
[33:45 – 38:24]

• Backdrop: Retail ETF down ~7% this week, with Walmart, Home Depot, Target, TJX up to report.
• Outlook: Revenues solid, but gross margins under pressure from tariffs and post-stimulus normalization.
• Stocks to Watch: TJX (“sweet spot for trade-down”), Ross Stores (adopting TJX playbook, potentially poised for catch-up on brand elevation).

Key Quotes:

• “We’re seeing high single digit revenues, which…for retail…is a lot.” — Simeon Siegel [34:20]
• “I think Ross is on the verge of becoming something special…Ross was more of a discounter. If they can elevate that…you win on both sides.” — Simeon Siegel [38:24]

Panel Retail Picks

• Michael Koch: Likes Ralph Lauren, but suggests hedging after big run. Skeptical on Home Depot if rates keep climbing. [38:33]
• Karen Finerman: Cautious on Home Depot due to rate sensitivity. [39:17]

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9. Meta Layoffs: Efficiency or Morale Crisis?

[39:57 – 43:28]

• Layoffs: Meta to cut 10% of staff; morale on the decline with further layoffs likely, but compensation remains high.
• Panel Response: Mixed. Some see layoffs and cost discipline as positive (“year of efficiency = 50% move in Meta”), others flag cultural damage and employee anxiety.

Key Quotes:

• “Morale at Meta is bad…creating a culture where some are checked out and some are looking for new jobs.” — Julia Boorstin [40:30]
• “Every time they lay workers off, the stock usually goes up. He's done efficiency multiple times before.” — Steve Grasso [42:33]
• “I think we want to hear about more efficiency from Meta.” — Karen Finerman [42:51]

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10. President Trump’s Portfolio

[43:28 – 46:14]

• Disclosure: Trump’s trust reported buying top tech names (Broadcom, Nvidia, Dell, Intel, ServiceNow, Adobe, Workday).
• Panel: Questions appropriateness and optic of such trades, but note reported firewalls. Remarkable that politicians’ portfolios—both GOP and Democrat—consistently beat the market.

Key Quotes:

• “The trading performance of the folks in Washington is quite remarkable. Better than what you might expect by a random walk.” — Michael Koch [45:45]

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Notable Quotes & Memorable Moments

• “This is a debt story. I don’t think it’s about the Fed.” — Karen Finerman [08:04]
• “Can equity values rise as borrowing costs rise?” — Karen Finerman [02:52]
• “Emerging markets…still seeing one of the widest valuation gaps from EM to the US in decades.” — Tim Urbanowitz [14:51]
• “Every time they lay workers off, the stock usually goes up.” — Steve Grasso [42:33]
• “We know where [Meta] is spending…you probably want to hear about a company pushing higher margins, which is what this will do.” — Karen Finerman [43:07]

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Timestamps for Important Segments

• Introduction & Market Selloff: [01:03 – 05:30]
• Fed News & Rate Talk: [05:30 – 12:29]
• Tim Urbanowitz Interview (Strategies for High Rates): [12:29 – 17:53]
• AI/Emerging Markets Rate Sensitivity: [17:54 – 20:46]
• Commodities Selloff: [20:46 – 21:41]
• Microsoft/Pershing Square News: [23:34 – 26:35]
• SpaceX IPO Preview: [28:44 – 32:35]
• Retail Earnings & Stock Picks: [33:45 – 39:57]
• Meta Layoffs: [39:57 – 43:28]
• Trump Portfolio: [43:28 – 46:14]
• Final Trades: [46:25 – 46:56]

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Final Trades (Quick Picks)

• Michael Koch: Allstate (cheap to group, generally cheap)
• Karen Finerman: Microsoft (“hasn’t been this cheap in a long time”)
• Tim Seymour: Ulta Beauty (largest retail position, ahead of earnings)
• Steve Grasso: Ross Stores (props to Simeon Siegel)

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Summary

This episode of Fast Money dissects a day of sharp market volatility driven by surging global bond yields, with caution surfacing on whether equities—especially highly valued or leveraged AI and tech names—can sustain further gains. The panel debates potential Fed impotence versus market realities, respective sector sensitivities, and hedging strategies for the new regime of higher rates. Key companies in focus include Microsoft (as a hedge fund favorite and value play), retail discounters like TJX and Ross Stores (seen as well-positioned in the current consumer environment), and Meta (where layoffs are seen as both a cultural blow and a margin-positive catalyst). The SpaceX IPO’s scale and governance quirks draw close scrutiny, and a peek into President Trump’s apparently winning stock portfolio rounds out a broad and sharply topical episode for investors navigating volatile and shifting macro conditions.

Transcript

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[Melissa Lee]

live in the NASDAQ markets like times Square, this is fast money. Here's what's on tap tonight. We're going to take a look at Nvidia earnings and what to expect out of the chip maker. But first we're going to look at global yields. The ten year cracking four and a half percent for the first time this year. Yields around the world also rising. What does this mean for the markets? Meantime, a big week for retail earnings for Wal Mart, Home Depot and Target. Give us the pulse of the consumer. What will we hear from the companies about consumer spending? Plus metals meltdown as a resource trade stalls. Microsoft catches a bid thanks to a nod from one hedge fund. And Metta employees bracing for layoffs next week. What to expect? What's next for the Mag 7 Laggard? I'm Melissa Lee comes along CDV at the NASDAQ on the desk tonight, Tim Seymour, Karen Feineman, Steve Grasso and Michael Koch. So we start with the rate reckoning that ripple through the markets day. Treasuries weaker across the curve. The 10 and the 30 year yields each touching their highest levels in almost a year. While shorter dated notes sold off the Yield on the 5 year at 13 month high while the 2 year hit levels not seen since 2025. March of 2025. All those moves putting pressure on stocks. The S and P falling 1%. The Dow shedding more than 500 points while the tech heavy NASDAQ led the declines off by a percent and a half. The world's biggest company, Nvidia seeing a big pullback after its record rally ending a seven day winning streak. It is more than 4% decline. That was the biggest drag on the NASDAQ and the S&P 500 today. And it took wind out of the sales of the broader semi trade to the SMH, down nearly 4% with ARM and recently red Hot Micron and Intel leading. Even cerebrus which rose 68% in its market debut yesterday, gave back 10%. So is a surge in rates now casting a shadow over the long term unstoppable AI trade? Is it casting a shadow over the entire markets? Tim, what do you say?

[Karen Finerman]

Well, it felt like the Ides of May, you know, and it felt like a day like these things had been lurking and suddenly they popped out. Now there was a terrible pie number in Japan and we've been watching Japan the whole time. You've heard those numbers. I mean, highest rates ever in Japan. We issued above 5% in the US for the first time since 2007. Gilts are at 28 year highs. It's a dynamic where can rising equity valuations. Can equity values rise as borrowing costs rise? And I think the equity market has taken a pause today after a heroic run. But I think the driver was Japan. On a week when we had a terrible pie.

[Melissa Lee]

Did it feel like it was just like rates were an excuse to lighten up?

[Tim Seymour]

Yes, but rates are themselves also are problematic. Right. So you know, we've got, the trade is built upon a lot of leverage among chips and leverage. Right. So the higher rates go. I think you'll start to see rate of spreads on Triple Bs for example. Every trade set up for that. I was a little spooked by the action today. Not, not the ones that have gone up, you know, several hundred percent. For them to come down a lot in one day is, doesn't really mean anything. It's the rates thing that, you know, around the world things just felt very unsettled. Even though you had oil move, you know, a little bit, not a ton, but so I'm always long. But I did put on additional hedges at the end of the day today.

[Melissa Lee]

Yeah, I mean in the UK, long bond yields were at what, 30 year highs, 28 year highs, JGBs, 30 year highs. I mean there's a pressure that exists outside of what's going on here around the world to pull rates higher.

[Tim Seymour]

Just say one other thing. So, you know, I heard some commentary about, well, you know, rates are higher because of the expectation of growth in the economy. I'm not, but I don't think that's what this is, this seems to be.

[Karen Finerman]

We've got plenty of proof for the last two weeks from CPI and cpi.

[Tim Seymour]

Yes.

[Melissa Lee]

So inflation is out there, right? Yeah.

[Tim Seymour]

But what the cause of it I don't see is more immediate. And this bond thing is becoming.

[Steve Grasso]

And I think if you look at the different markets, the US market is quite different than the European market. And if you look at the the markets, the US market is up year to date, China's up year to date, Japan's up year to date. So look at the performance from the Iran war and that's how I'm gauging the marketplace right there. So the market has gone up, rates have gone up. So I'm not worried about it yet. Karen said she has a bunch of little trigger trades or big trigger trades to go off. I think if the 10 year broaches five, that's going to be a problem even higher than the four and a half that that normally is the problem. So I think we're not near that yet.

[Melissa Lee]

We've got some breaking news out of the Fed. Let's get to Steve Liesman for that. Steve.

[Steve Liesman]

Hey, Melissa. Yeah. Procedural thing by the Fed with naming Jerome Powell, whose term ended today as Fed Chair, Naming Jerome Powell as Fed Chair Pro Tem. And that is a designation that will remain until Kevin Warsh is sworn in as the new Chair. He was confirmed by the Sen On Wednesday. But there's a lot of other stuff that has to happen. The President has to sign a commission. Now what's interesting about this, among other things, is that Governors Bowman and Myron dissented from this. They didn't want an indefinite naming of Powell as Chairman Pro Tem. They say they would have supported it for a week, they would have supported it for a month. But if it goes on longer than a month, they would want either another vote by the board or a presidential appointment to be chair. So they dissented, but ostensibly enough five members. I don't know if Powell himself actually voted on this, but in any event it would have been 4 to 2 or 5 to 2. But Powell will be the Chair of Pro Tem until Warsh has sworn in. A bit of trivia which is it has taken nine days for a person who is not at the Fed to be confirmed and sworn in from the time of the nomination. On average, that is Melissa.

[Melissa Lee]

From the nomination. Not from the confirmation.

[Steve Liesman]

No, I'm sorry, From the confirmation. From the confirmation.

[Melissa Lee]

I was going to say we're way over that. That's remarkably bad trivia. Yeah, it's got A lot. Great. Fond of trivia, Steve. Greatest great to hear from you. Steve Liesman with that speaking, I mean this is Powell's last day. The picture for Kevin Warsh is much more complicated now. Mike co I would think.

[Michael Koch]

Well, I mean some of the inflation data that we've been getting is outside of the Fed's control. We have basically geopolitical events which are driving up energy costs. Energy costs will bleed through to higher prices in a lot of areas due to logistics and everything else. It basically affects almost everything. So there is some question about how much the Fed can do as a policy response to sort of solve that problem. I don't think there's a whole lot that they can do. But as rates go higher it creates other problems too. We haven't mentioned it yet. Obviously it increases capital costs for business, it increases interest costs for governments and ours runs a pretty big deficit and there's a lot of refi that has to go on as they're essentially dealing with a lot of short term debt that's been a problem for the last two years. So you know, that we'd really like to see get mitigated somewhat because it's going to be problematic and it bleeds through across so many areas.

[Karen Finerman]

I mean, Mike says it's out of some of, it's out of Fed's control. It's all out of the Fed's control. I mean, unless you think the Fed should be hiking and have felt it all along and that they're behind the curve in terms of kind of latent core inflation, I mean this is all out of their control. And what we're seeing through from the pie numbers, which is that higher oil prices are feeding through to core prices. We've had that evidence and even when you strip out food and energy. So and I would go back to this week to something Karen said just about how she was implying that the hyperscalers are no longer a free cash flow story anymore. And this was an epic week for Google, who borrowed, who's now borrowed almost 20 billion in various currencies around the world. Amazon on Tuesday, another 3.6. In Switzerland, Metta beat them all to 25 billion. They're all trying to issue as long as possible. By the way, these are the railroads of 100 years ago. They're issuing long, they're putting in infrastructure, they're raising debt. And it's not, it's not a coincidence that this is all interrelated this week for the market. Also coming back from a Trump XI summit where there was no progress on Iran and people kind of felt like US and Russia get together on Iran, it's solved. It's that simple. And we don't have anything that says the straits are really going to be open. So this is prolonging. This is where you now start to hear from every strategist that says, hey, if by July 4th weekend or really so it's not Memorial Day, the start of driving season, but if by July 4th we don't have oil prices back down, we've got something that will emerge even higher. And I just think this is a debt story. I don't think it's about the Fed. I think Kevin Wash is walking into a horribly difficult thing and yeah, I mean, does Myron have any credibility? You know, I just have to throw that out. Sorry.

[Melissa Lee]

We'll let that remain out there. But I'm glad you used the word rushing because it did feel like a rush for all of these hyperscalers to go out this particular week and in the recent weeks to raise money around the world, not just here because of the, you know, if they, they couldn't possibly issue it just in the United States and dollars, I mean there's just, there's be too much out there.

[Tim Seymour]

We are the biggest, most liquid and. Right, right. So I mean it's a very great place to start which they have I concerned about your analogy to the railroads because I believe they all went bankrupt and so that would be really these guys doing.

[Karen Finerman]

They're laying down infrastructure for the future. What do you think railroads were doing? They were laying down tracks but they

[Tim Seymour]

didn't have the country cash flow to. To fund it. Yeah. So I take the metaphor too far.

[Karen Finerman]

My point is that this is a time where these are the biggest companies in the world as the industrial railroads were years ago on the worst thing.

[Tim Seymour]

I wonder if actually this environment that he's inheriting, it'll be easy to say I'm independent because it's really hard to cut right now, I think.

[Melissa Lee]

No, and nobody's expecting it, nobody's demanding it.

[Karen Finerman]

There is no more swap spreads have already got you with a hike by next March.

[Tim Seymour]

So that. So he's cutting.

[Steve Grasso]

Yeah, but they're not going to, they're not going to hike. I don't care what the market's already hiked around.

[Melissa Lee]

And if inflation is where this is

[Steve Grasso]

supply shock, this is not a demand shock. The reason why you hike is to crush it. Rates have risen. That's actually killing demand right now.

[Melissa Lee]

The only supply shock. Let's just play this out what is the straightforward moves remains closed for a very long time. A very long time.

[Steve Grasso]

I'm going to, I'm going to start where Tim started. What, what would raising rates do in this environment? Nothing. They have no control.

[Tim Seymour]

I agree with you kind of that, right. I mean demand will be squashed and I think rates will come down anyway because prices be, you know, you're only here for high prices, prices.

[Karen Finerman]

And I kind of agree as well. But I'll say this, I mean look at where risk assets are, look at where liquidity is. You can't tell me reeling in some of this isn't going to help at the margin. You can't tell me by the way

[Steve Grasso]

the lower income raise.

[Karen Finerman]

I'm not, I'm not sure. I think the market, by the way, who hurts the high income people more than anybody. I mean the market like the wealth effect around the market is, is the top end of the K shape. The wealth effect in terms of spending in the economy is definitely going to hurt people. And there have been times when the Federal Reserve hasn't, they hadn't been, they've implied, they haven't been explicit that they're targeting the market, that they're, they're trying to get the froth out of things. So I think liquidity conditions right now and that includes credit. But we'll wait and see how long have been wildly, wildly aggressive. And I think there's a lot of people this week is all about momo and FOMO and you know, so.

[Melissa Lee]

All right, for more on what rising yields could mean for the markets, let's bring in Tim Urbanowitz. He is a chief investment strategist at Innovator from Goldman Sachs Asset Management. Great to have you, Tim. So how do you see what's going on in global yields? What is the message to equity markets, do you think?

[Tim Urbanowitz]

Well, Melissa, I think we just crossed a pretty crucial threshold that I mean the move that we saw today was pretty violent. You know, 13, 14 basis points higher on the 10 year yield. That's a lot of volatility. And what we've seen really over the last couple of years is the higher rates go and particularly crossing that four and a half percent level, the more sensitivity you see to equities with moves higher. So as we've crossed that four and a half percent level, you're going to start to see bond yields and equities moving in the same directions which we want to be very careful of in our portfolios. And I think you have to go back to the 2022 playbook and look at some of those trades that did work. And particularly we're having a lot of conversations right now with advisors on how do you disconnect the need for risk management in your portfolio and relying on interest rates having to come down or not rise further to be able to protect your portfolios. So that's really important right now. That 4.5% level is key and we've ran right through it.

[Melissa Lee]

So what is the hedge then to this environment? Is a hedge of this environment energy?

[Tim Urbanowitz]

Well, I think energy is a great play, especially as we really haven't seen much any progress on the straight of four moves at all. And investors continue to have what we consider to be pretty unrealistic expectations. But we're also seeing a lot of advisors turn to derivative based strategies. That has been a huge trend in the ETF market here over the last couple of years. Strategies with built in risk management, buffered ETFs, dual directional ETFs, other income plays that really disconnect the interest rate and the equity component and put structured risk management with options in place. So that's been one of the biggest trends that we've seen over the last couple of years in the ETF market. And I think a lot of that, Melissa, has been driven by what we saw in 2022, where that traditional risk management playbook, whether it be low volume equities, interest rate plays, bonds, did not work. And we're seeing that play out again this year.

[Tim Seymour]

It's Karen. Thanks for being on Tim. So emerging markets has been a very successful play until pretty recently. What's your take on that?

[Tim Urbanowitz]

Well, we're very bullish here. And you look at this, we view emerging markets is really the next place for potential outside outsized returns with the infrastructure trade. If you look at the move this year, it's a very strong move higher in emerging markets this year. Even with that move, we are still seeing one of the widest valuation gaps from EM in the US that we've seen over the last couple of decades. And if you take a step back and you look at the exposure that you're getting when you're buying emerging markets, you know, almost half of the MSCI emerging market index is, is Taiwan and South Korea, both very big players in the air space, you know, you know, Taiwan manufacturing backbone, you look at South Korea memory, very, very big ambitions longer term. So we think a way to get access to that high growth narrative, that infrastructure story, but in a place where you really haven't seen the same moves that we have seen here in the US and what I think is interesting is when we're looking at advisors portfolios right now we're seeing pretty big underweights still to emerging markets portfolios that are very heavily overweight us, which have done really well. But we want to make sure that we're truing those up and really getting that exposure right now.

[Steve Grasso]

Tim, when you look at the slack, you'd said four and a half was the rate to be concerned with. But when you look at what we just had in earnings season with 27% earnings growth with MAG7 names, 20% blended and then you know, roughly around 12% for the other 493, does that make you think we can get closer to 5%?

[Tim Urbanowitz]

Well, I think there's going to be some bifurcation in the markets here in a pretty big way. I mean, earnings have been nothing short of phenomenal. Even if you look at the revisions. I mean, they've been fantastic. And I think a lot of that has to do with the macro growth story that we have seen here. But you know, we had this rotation trade that was happening, you know, end of last year, early this year, whether that be small caps, equal weight S&P 500 and that's really slowed in a big way. I think a lot of those other sectors outside of tech are going to be able to stomach higher rates a lot less. So we think it really puts the brakes on that trade. We do still think the Runway looks very nice for those pockets when the Iran conflict resolves. But in the short term, as rates are moving higher, you're going to see more sensitivity there. You know, take, take small caps for example. Up until the start of this week when the market was going down on days when the market was selling off, you really saw, you know, very slight underperformance, you know, from iwm, from small caps relative to large caps. And then on the way up when the market was going up, you saw more significant outperformance. So that was a nice dynamic. You look at a move like today and that really broke down. And I, I think the big reason that we saw that breakdown is because of the sensitivity to rates and they're going to have a much higher impact on small caps and other pockets of the market that that rotation trade was playing out in.

[Melissa Lee]

Tim, thanks for joining us.

[Tim Urbanowitz]

Great to be with you.

[Melissa Lee]

Tim Urbanowitz, what's your take on em? I only ask because first of all, you're an emerging market specialist and second of all, you know, you might be getting much, much More exposure actually to the trade by layering in EM on top of your US exposure.

[Karen Finerman]

One Tim said in front of another Tim that that the weighting when you look at Taiwan Semi it's about 7% of the MSC IEM. You add in Samsung and Hynix and you add in basically Korea and Taiwan. That's right. You're getting an enormous exposure to that part of the trade. I mean what a lot of investors have said historically, the crowding out of the max 7 for international stocks overall, not just GM was hey, I'm not getting exposure to big exciting tech stories. Well you are and most investors are really underweight international and I believe that. And I run an international etf. I think it's fascinating for me to maybe be on the other side of someone that's singing the praises of M during a time when rates are rising. Because I'll tell you someone that's been in em for 25 years, I do think that rising rates will hurt em a lot. Not as much as they used to. There's been fiscal adjustments, there's currencies that are free floating aren't hurt as much. There's not a debt load like there used to be. It's not dollar debt. They have their own local debt. Having said that, higher rates, higher risk. I think emerging is going to underperform at least in the short run. Even though structurally fundamentally it is cheap. And I you can get all those trades you want here in emerging in the msci all world ex us.

[Melissa Lee]

And in this context, Mike, I'm wondering what your opinion is in terms of, you know, will the trade here be more defensive in a rising rate environment?

[Michael Koch]

Well, I think the problem is that the AI trade has become as we can see that with all of the essentially debt issuance. What we're seeing is that big companies that were throwing off massive amounts of free cash flow are essentially making investments now in exchange for the potential for growth in the future. What is that? That means that they're extending the duration. That means that they're extending and increasing their sensitivity to rates. And it's also a more speculative trade than it was to buy Alphabet now, than it was to buy it three years ago when they were pumping out cash and weren't making these kinds of investments. I will offer the following. And obviously we do see this and I think this is what Tim's alluding to. You know, the Russell 2000 typically more rate sensitive than large caps are and for the exact same reason. That would obviously be the same reason why you would See more sensitivity in emerging markets. But I think as a barbell, one might think about getting some old economy names in the US which are trading much more cheaply frankly than the S and P is, and a little bit of that emerging markets as well, because that's also trading at a very cheap multiple. You know, the emerging market index, which Tim is more familiar with than I am, is probably trading at around 12 times forward. So I think that provides a bit of insulation.

[Melissa Lee]

Meantime, precious metals losing their luster today. Silver having its worst day since the end of January down more than 10%. Platinum gold palladium also under pressure today. And the gold miners sliding the GDX ETF down 7% with big losses in Anglo Gold Harmony and Hecla Mining. Steve, what do you make of this pullback?

[Steve Grasso]

So when you look at rates rising, that's your competition because gold has no yield to it. So usually gold will rebound when the Fed decides to take care of rates that are rising out of control. So it's usually when they start cutting rates that you see money flow into gold. This is not the proper environment for gold right now. That's why you see people taking it

[Simeon Siegel]

off the the table.

[Karen Finerman]

Yeah, look, best week for the dollar since March and gold's not going to perform here, by the way. For the guy that's supposed to be the expert, I need to correct myself. Taiwan semis 14% of the.

[Melissa Lee]

Even more.

[Karen Finerman]

And then you add Samsung and Hynix. That's 25%. Just those three stocks are 25% of the EEM. But I stand corrected.

[Melissa Lee]

Coming up, Microsoft a notable winner in today's sell off. The long lagging tech giant notching back to back gains. What is behind the move and what does it mean for the software space? Plus, a new timeline for when SpaceX shares could start trading. The latest details in the blockbuster IPO and why some major investors are pushing back. Don't go anywhere. Fast money's back in two.

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[Melissa Lee]

Welcome back to Fast Money. Microsoft catching a bid today after Bill Ackman's Pershing Square disclosed a brand new stake in the tech titan. Early this morning, Ackman revealed on X that Pershing started building its positions in February after the stock's post earnings drop. The hedge fund manager said investors were too concerned over Microsoft's position and that its investments in Copilot would result in more adoption over time. Still, Microsoft is down nearly 13% this year. The worst performing mag7 name of 2026 what do you make of this buy? Karen?

[Tim Seymour]

It's interesting. I mean he bets big, you know, and, and so it's an interesting call. I think that's why the IGV was up. Microsoft is a very big holding in the igv so his timing actually seems pretty good. I don't know how, I don't know exactly how, what his average cost is, but whatever, he owns it from here. This is the question what do you do from here? I'd rather, for me, I'd rather own some of the other ones. So I know it's cheap for a company like this, but I'd rather be in Google. That's how I'm positioned.

[Melissa Lee]

Yeah. I mean his argument Azure +365, they're two of the deepest franchises in the enterprise right now. So how can you bet against that?

[Steve Grasso]

Yeah, and we have to decipher. We also need some closure as to per seat or per agent how Microsoft is going to try to resolve that issue. To Karen's point, he did sell the other ones though, right? He sold Alphabet to get into Microsoft and if you compare the charts, he had a pretty good run in Alphabet and he's trying to put some money to work and push the market in Microsoft. So I don't necessarily disagree with it.

[Melissa Lee]

Yeah. What do you think?

[Karen Finerman]

I like the call. I like Microsoft here. They are too important and too much of a backbone on enterprise. I don't really care. That copilot's gotten out of the gate slow. It's kind of like what we've said with Google and Search and it's kind of what we've said with Apple. How are you going to displace Microsoft? Also this rally in Microsoft is, it's a software rally. I mean, I don't know which is the dog and which is the tail, but you can't tell me that Microsoft wasn't getting pulled down by the software argument. And so I think it was overdone. And if I was going to buy a software company, it would absolutely be Microsoft over the others.

[Melissa Lee]

It does feel like if the industry is going to move away, if the SaaS industry is going to move away from a per seat sort of model that Microsoft would be able to figure that one out. Mike.

[Michael Koch]

I mean first of all, they obviously have such an embedded presence already. I'm curious how many other people on the desk tonight have already added the cloud add in to Excel as I have done. It is trading look at a 10 year low in terms of its multiple. There's not a lot of things that have performed as well as Microsoft has and continues to perform that are trading at this kind of valuation. It's now at or cheaper than the S and P. So I think in terms of timing, I rather like it. The software business is going to continue to be pressured by all of this. But if there's any one of them that is in the best position of the group to take advantage of what's coming and is a part of it, it's Microsoft.

[Melissa Lee]

There's a lot more fast money to come. Here's what's coming up next.

[Simeon Siegel]

Countdown to liftoff. SpaceX expected to file for its long

[Karen Finerman]

awaited IPO next week.

[Simeon Siegel]

What we could learn about Elon Musk's company and the pushback we're hearing from some major investors. Plus, ready for retail, the group gearing up to report earnings next week. What to expect from some of the largest companies and the discount name a

[Karen Finerman]

top retail analyst is giving a try on. You're watching Fast Money live from the NASDAQ market site in Times Square. We're back right after this.

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[Melissa Lee]

Welcome back to Fast Money. SpaceX reportedly hitting the boosters for its planned IPO. CNBC's Leslie Picker has got the latest Leslie hey line.

[Leslie Picker]

Hopefully you rest up this weekend because according to people familiar with the matter, they are expecting to flip their S1 public as soon as next week. So that is basically the filing where we get all of the financial details, where we get, you know, the risk factors and things of that nature. We won't get the price quite yet. That's going to come a couple of weeks later where we get the price range, where we get the valuation and then that is when they start marketing the deal. So maybe a week, a week and a half after that is when you'll start to see the final price and then a debut here on the NASDAQ the following day that our Christina Parts Napolis confirmed is the listing venue for this record breaking deal by most reports.

[Melissa Lee]

And that's in hopes of being included in a big index here.

[Julia Boorstin]

Yes.

[Leslie Picker]

Which has kind of a bunch of different interesting dynamics. You saw yesterday, I believe the letter was sent the day before, but it was published yesterday. Pension funds from New York and California coming out and saying we don't support what's been reported about the governance structure of this deal. And you ask, well, why would a pension fund care about something like this? Pension funds don't really buy into IPOs. Well, they expect it to be quickly included into some of these indexes, which means they are going to be forced to buy into this company. And so they're already concerned about the governance implications that are at least reportedly under consideration for SpaceX, including what they're doing with super voting shares and the inability to remove the CEO unless he himself chooses to remove himself from that position. No, only arbitration for shareholders disputes. So a lot of things like that that they have concerns about.

[Tim Seymour]

So this isn't a standard sort of roadshow kind of thing. What, and the retail part of it is different than we normally see. Do you have any idea how that's actually going to work?

[Leslie Picker]

So what I've heard talking with sources is there's this notion that the retail that we saw with a lot of the crypto IPOs last year, it created a pop in many cases, but then it kind of fizzled out after that. So they're trying to navigate, you know, if you go through a Robinhood, if you go through a sofa, if you go through one of these types of companies, do you have as much control over kind of who's going to hold your stock for the long run? That's always been the concern about retail and why so many IPOs throughout history have tilted more toward institutional. So I was talking with a source who said that they're looking at retail abroad, looking at working with brokers in friendly jurisdictions in the UK and Japan and Canada as one way to kind of bolster that retail allocation in a way that isn't as maybe easy to flip as we've seen, you know, with some of these other IPOs in recent years.

[Melissa Lee]

I would think the dynamic for this one's a little bit different in that Elon Musk is. Elon Musk. Elon Musk has a devoted shareholder base in Tesla. And maybe the retail investor who invests in Space X might be a little bit more, have stronger hands.

[Leslie Picker]

Yeah, exactly. Well, that's what you would think. And so I think what they're trying to prevent is this from becoming a meme stock. It already has likely a really, really small float here. The reports out there say that the issue size will be 70 billion and the valuation 1.75 trillion. But relative to valuation, it would be really tiny. And so the concern is that, you know, what does that supply demand dynamic look relative to the valuation? We've never seen anything like this before.

[Karen Finerman]

High class problems. Boy, they are, I mean, crazy.

[Leslie Picker]

The current biggest IPO we've ever seen was Saudi. It was 29 billion. So we're talking more than two times the size of that offering. It's no small task to fill that order book and then some because you want it to be oversubscribed. So it's just a matter of what price that happens at.

[Melissa Lee]

Leslie, thank you. Thank you, Leslie Picker. Coming up, a busy week of retail earnings on deck. What to expect from the big box names and the discount retailers. Our next guest is taking to check out. That's when he's back into. Welcome back to Fast money. Stocks selling off to close out the week as treasury yields climbed. The Dow falling more than 500 points. The S&P 500 dropping one and a quarter percent though did eke out its seventh straight week of gains. The NASDAQ leading losses today down more than 1 1/2 percent. Meantime, the 10 year yield hitting a high of 4.59%, its highest level in nearly a year. And WTI crude jumping more than 4%, settling above $105 a barrel. It wasn't just US equities under pressure. Stocks in China, Japan, Germany, Brazil and Mexico all lower today as well. Another tough week for retail. The ETF tumbling almost 7% since Monday. That's its fourth losing week in a row. The weakness coming ahead of the kickoff of retail earnings. Home Depot, Target, TJX and Wal Mart all set to report next week. Simeon Siegel follows retail and e commerce giants for Guggenheim. Simeon, great to see you.

[Simeon Siegel]

Great to see you.

[Melissa Lee]

Got to ask about Wal Mart first. It's the biggest and it's perhaps the highest valued. What are you expecting here?

[Simeon Siegel]

So you do have to ask about it is the biggest. I sadly don't cover that one. So we can talk about some others within there. It probably wouldn't be right. So I, I will take a pass on that one.

[Melissa Lee]

Okay. Now fair enough. My apologies. I should have known better on that. I do know though that you love TJ Maxx and I'm wondering what the environment is. Is it a TJ Maxx specific execution story or is it that a lot of other retailers have got a lot of stuff that they got to sell. They ship it to TJ Maxx.

[Simeon Siegel]

So listen, it's all the above, right? You and I have been talking about TJ for a while. I think what's interesting is you go to your first comment, we started with look how red the tape is. Look how negative everyone is. It must be we're going into a recession. It must be the consumers disaster. It must be these companies are doing poorly. The fascinating part, it's not true. And so we're going, we have a busy week of earnings. We just did have a busy week of earnings. And so the companies that have reported so far revenues have accelerated. We're seeing high single digit revenues, which I know you were talking about some of the hyperscalers before. I know that doesn't sound all that much but for retail, high single digit revenue growth year over year is a lot. And so I think what we're seeing is this interesting dynamic where tariffs raised prices. The consumer actually did take that, but it was split because margins are being split too. And so it's the best I've seen about revenues. But it's not. But for the gross margins you're seeing that pressure. And so I think once we've gotten through this idea, we've got tariff raising price and stimulus and now we're past that. People are getting worried. If you think about tj, if you think about the discounters, that's not a horrible environment for them. This is a company that benefits with its existing shoppers. It also benefits from a trade down. And so I think I would expect both TJ and Ross is going to report. So they're, they're kind of cousin. They're both, they both should have really good revenue numbers.

[Tim Seymour]

I mean it's. Karen, thanks for being on. So aside from TJ who we know, you know can really, this could be a sweet spot for them, difficult environment. Who's out there, who's really operating well?

[Simeon Siegel]

So hey Karen, so it's an interesting question because you said operating, you didn't say who's going to sell. Well, because I think a lot of these companies are going to put up good results and so or at least good top line results and get people to spend more. The question from an operating perspective of who's going to get respected for it because we did. You just had Birkenstock and on put up double digit numbers, really good numbers. Look at Birkenstock stock over this past week. And so TJ is one we always talk about. My team actually just did a lot of really interesting work I think on raw stores, which is not a company we normally talk about. The last 10 years TJ dominated this space. TJ became the kind of like the beacon of. You have Amazon taking half of retail from department stores and TJ taking the rest. I think Ross is on the verge of becoming something special. I think Ross is adopting the playbook that TJ started Eight years ago, really quietly. And what that is, it's becoming more elevated. It's taking more of that brand share because as people walk away from department stores, they need somewhere to go and those brands need somewhere to sell. I think Ross could be a very interesting one to watch.

[Steve Grasso]

So, Simeon, I'm glad you're comparing the two. Ross, you get a different dynamic to it. It's completely domestic. And tj, you get the international approach. So you get that over ordering on steroids from tariffs because obviously the more companies over order, the better it is for those two names. International versus domestic. Is raw stores going to benefit more than tjx?

[Simeon Siegel]

So you're absolutely right in that right now international is not a great thing. It's kind of funny. We always, I mean, listen, we, we always talk about Nike and sometimes having international is really good. Right now it's not. And so I think you're absolutely right. I think right now if I think about everything happening outside of this country or you can focus on just appealing to the dislocation that's going to happen here, I think I want to be here now. I do think what's interesting is I went back about 10 years and looked at my research for TJ versus Ross and I certainly didn't remember it, but 10 years ago, Ross was viewed as the better business. Sometimes TJ was the better stock. Over the last eight years, TJ has always been the better business and sometimes Ross has been better stock. And so I think Ross right now can kind of take that bear hug of that US consumer benefit from the fact that these brands need to sell somewhere and they're going to be open to it and then recognize that if they're really elevating their brand, they massively raise their capex guidance. They're going to make these stores look better. And this is exactly what TJ did before. And so if they can make the shopper feel like this is a better place to get brands because remember, we've always talked about is TJ doesn't sell cheap clothing. They sell expensive clothing cheap. I think Ross was more of a discounter. If they can elevate that and do it slowly and not alienate their core customer, but bring in the customer from above, I think you win on both sides.

[Melissa Lee]

Simeon, great to speak with you as always.

[Simeon Siegel]

Have a great weekend, guys.

[Melissa Lee]

You too. Mike Coe, in retail, what do you like?

[Michael Koch]

I've liked Ralph Lauren for quite some time, although it's had a heck of a run. I mean, they have continued to operate very well. It was actually one of the CNBC acronyms in my CNBC acronym on more than one occasion. So this is a name that I have liked. I am feeling though now that it's broken below its long term moving average and it's up 200% recently. You know, if you go back to about 20, 23 to me, I think you might want to start putting some put spread collars on. You can hold on to it, but just own some put spreads, finance, buy some upside calls, take advantage of the elevated volatility. You know, Depot is a name I want to look at for a valuation perspective. But if the rates are going higher, it's just really hard to get behind that one even now.

[Melissa Lee]

Is Home Depot where it should be right now, Tim? Stockwise?

[Karen Finerman]

I don't think so. But again, because I think some of the same trends that Simeon said with the consumer are doing okay, are resilient. I do think that there is a lot more interest rate sensitivity there. And so, you know, this is a bad day for a Home Depot when all we do is talk about rates. Great. It's great. Listen to Simon. This is fantastic bottom up commentary. I'll just say that, you know, you look at one year charts on a lot of these names. We're near the bottom of a one year chart. I mean it's great to hear that on had great numbers except for the stocks trading near 52 week lows. And I think a lot of these names are under a trading under the impression that the consumer has either given out or is about to give out, but that the margins probably peaked.

[Melissa Lee]

Coming up, metal layoffs hitting morale. Why this round of cuts looks a little different. The impact on the social stock as a company leans into its ambitions. The details when Fast Money returns. Welcome back to Fast Money. Metta employees bracing for sweeping layoffs next week as the company plans to cut 10% of its headcount in what it calls a bid to drive efficiency. And it's already taking a toll on the SaaS morale. Julia Borson's got the details here.

[Julia Boorstin]

Julia Melissa Sources tell us that morale at Metta is bad. Employee anxiety ramping up after last month. The company confirmed layoffs are coming on the 20th, creating a culture where some are checked out and some are looking for new jobs. These layoffs are expected to be broad as AI enables Meta to flatten its org structure, unlike recent layoffs from restructuring certain divisions and shifting away from the Metaverse. Sources also tell us that Met is expected to do more layoffs this year, but hasn't yet determined what's coming with that uncertainty? We're hearing some employees are hoping to be laid off to get met as generous severance. Now aggregated data by Blind, an anonymous professional network that requires users to verify employment with a work email address echoes what we're hearing from sources. Meta's overall employee rating on the platform declined 25% from a peak in the second quarter of 2024, with a 39% decline in its culture rating. The only area where matter remains high is compensation. We've heard some divisions are less concerned about cuts as Metta leans into AI infrastructure, Frontier research and monetizing AI. We reach out to Meta for comment and they declined. Melissa.

[Melissa Lee]

Julia, thank you. Julia Boorstin. Really interesting to hear what's going on inside the company, Karen. It doesn't sound like a very good culture at all.

[Tim Seymour]

No. I wonder the thing about what we're going to announce it on the have a fair amount of time. Between the time and decision, I don't know. They have to get their ducks in order, I guess. I mean, you can understand why it's a scary thing because it's not unlike in the past, if you got laid off from Meta in one of the smaller restructurings. There's lots of places to go. You're a coder, you're valuable, all of that. Now, obviously, we're looking at a very different environment, so I don't know, I feel like it's always best to just rip the band aid off quickly as possible. As an employer.

[Melissa Lee]

Yes. Yes, absolutely.

[Tim Seymour]

For sure.

[Melissa Lee]

Yeah.

[Tim Seymour]

As opposed to being under, you know, rolling cuts.

[Steve Grasso]

I'd like to hear about that severance package. Did you hear what you're saying about that? Sixteen weeks or whatever. But the truth is, every time they lay workers off, the stock usually goes up. He's done years of efficiency multiple times before.

[Melissa Lee]

Except that they're spending billions of dollars in Capex in order to get to this place of efficiency.

[Karen Finerman]

I'm leaning in Steve's direction. I mean, I even heard efficiency in that headline. Right. Like the year of efficiency was a year of a 50% move in matter. I mean, I think we want to hear about more efficiency from matter.

[Melissa Lee]

We.

[Karen Finerman]

We know where they're spending. Would. Would you want to hear them say they're no longer spending and. I don't think so.

[Tim Seymour]

So think the stock would skyrocket?

[Karen Finerman]

Well, it would probably like that, too, but I, I think hearing about efficiency and layoffs, it's not, you know, yes, they're raising debt, but they're not floundering. And you probably want to hear about a company pushing higher margins, which is what this will do.

[Melissa Lee]

Coming up, the president's portfolio. Trump making some big trades during the first quarter. The names he's buying and selling after the break. More fast money into. Welcome back to Fast money. President Trump making hundreds of millions of dollars in stock trades during the first quarter. A trading disclosure released last night showing Trump bought shares in some of this year's hottest names, including Broadcom, Nvidia, Dell and Intel. The US Government took a stake in intel back in August. Shares up more than 300 in C 60% since Trump. Also scooping up software stocks like ServiceNow, Adobe and Workday during the group sell off. A spokesperson for the Trump Organization saying the president is not involved in the investment decisions. Nonetheless, there they are, an interesting and winning portfolio.

[Tim Seymour]

I'd be really curious, maybe the data is there. What were the timing of these trades, when did they happen, particularly Intel. But there's a lot of them. It's just sort of, I don't know. You know, he's worth incredible amount of money now, way more than we can imagine. I'm sure. It just. Why would you need to do this? I know Nancy Pelosi got an incredible amount of backlash from any trading that her husband was doing, right? Not even her. Let's just say it's the same. Her and her husband would be the same. Let's say this, I don't know, it seems unnecessary.

[Karen Finerman]

Well, I mean, first of all, this isn't like following Berkshire and what's Buffett doing? All right, it's not a 13F. And if you believe, and I think you have to at least take at face value, that there's independent sources that are independent, I would just say agents, independent people that are acting on, on without discretion, with their own discretion, without explicit orders. And if that's the case, is what it is, I mean, if you were buying the market, you would have bought a lot of these stocks. So, I mean, I'm not, you know, I'm going to presume that there has to be this kind of a firewall.

[Melissa Lee]

We, we present this without any sort of judgment as to whether or not it, I assume, I assume that this is all done. I's dotted, T's crossed according to the law. I guess the question is, is this what you want the law to allow the president to do? Mike?

[Michael Koch]

Well, I think one of the things we have seen, whether we've been looking at the GOP or we've been looking at the Dems, is that the trading performance of the folks in Washington is quite remarkable. Better than what you might expect by a random walk. So as far as I'm concerned, maybe what we just want is for them to release as much. Let them do what they want, release as much information as they want to, and we'll follow as quickly as we can.

[Melissa Lee]

Up next, final trades, Final trades.

[Michael Koch]

Mike Coe yeah, not on the buy list of anybody in dc. C pnc I'm looking at Allstate. Cheap to the group and just cheap generally.

[Karen Finerman]

Timbo Cheap generally. I mean, it's Microsoft. It hasn't been this cheap in a long time. Yes, software, but yeah, the big kahuna Microsoft.

[Tim Seymour]

Karen so as we were talking about retail, we're getting into retail earnings season. My biggest retail position is Ulta Beauty.

[Steve Grasso]

Steve Props to Simeon Ross. Stars.

[Melissa Lee]

Thanks for watching. Fast Mad Money with Jim Cramer starts right here now.

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like the power to do?

[Karen Finerman]

Don't worry, you got this.

[Melissa Lee]

Whoa.

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Hear that?

[Karen Finerman]

I did it.

[Bank of America Advertiser]

That's the sound of you helping your child find confidence that lasts a lifetime. Bank of America invites kids 6 to 18 to join golf with us for a limited time. Sign them up for a free one year membership, giving them to access access to discounted tea times at thousands of courses as we champion the next generation. Who dares to ask, what would you like the power to do? Restrictions apply. Activation required. CPFA.com call with us for complete details.