← CNBC's "Fast Money"
CNBC's "Fast Money"
Stocks Surge On Potential End Of War… And Countdown to SpaceX Public Debut 6/11/26
00:43:09
Markets rally after Trump decides to cancel strikes against Iran, and says a peace deal is near. The latest out of the Middle East, and how the traders are positioning into the end of the week. And all eyes are on SpaceX with just hours to go until the blockbuster IPO. Plus, why Oracle is tumbling post-earnings, all the details from Lennar’s earnings report, and why stakeholders in Madison Square Garden are rooting for the Knicks. Fast Money Disclaimer
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- [00:00]
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- [01:02]
Brian Sullivan
Live for the NASDAQ market site right here in the heart of New York City's Times Square. This is fast money. Here's what's on tap. A Trump infused stocks surge. Markets ripping higher as the president canceled planned evening strikes against Iran and says again that a peace deal or a deal of a deal is at hand. What we're hearing out of the Middle east ahead and just hours to lift off some SpaceX set to debut right here at the NASDAQ tomorrow. We have got the latest details on this blockbuster ipo, everything you need to know and maybe some things you don't about the first trade. Plus an Oracle hangover, the Chartmaster bets on a bounce in the Gold Miners and how the Knicks championship run is not only giving fans a surge, but a stock as well. Hey, everybody, I am Brian Sullivan in for Melissa tonight. Coming to you live from Studio B right here at the Nasdaq. And on your desk tonight, Karen Feynman, Carter Worth Vinyl and ison, and Stu Kaiser, head of equity trading strategy at Citi. Welcome, everybody. Big show. And let's begin with the powerful stock market surge that we saw late day. The rally coming as President Trump canceling this evening's threatened strikes on Iran, indicating that a peace deal or a framework of a deal may indeed be near. The Dow and S and p rallying almost 2%. The Nasdaq soaring more than 2 1/2 percent. The S&P 500 and Nasdaq both today wiping out yesterday's steep losses. And take a look at oil. It dropped. It was down already, but it dropped sharply right before the close Crude is Now in the mid dollar 80 range after trading in the 90s earlier in the session and 112 two months ago. Let's start off tonight by getting all the breaking developments. They are fast moving, some of them, trying to clear up minute by minute. Megan Casella in D.C. with more. Megan?
- [03:06]
Megan Casella
Brian, that's absolutely right. President Trump says the US Is close to a deal with Iran that would end the fighting, reopen the Strait of Hormuz and launch a new phase of negotiations over some of the nuclear issues that started the war in the first place. So while markets soared on this news, it is clear that this agreement is not yet set in stone. The president described documents as being in, quote, pretty final shape. And when he was asked how confident he was that it would be done this weekend, here's what he said.
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Reporter/Interviewer
It'll be soon, maybe this weekend.
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Megan Casella
And has the Supreme Leader approved this deal?
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Reporter/Interviewer
Sir, I understand the answer is yes.
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Megan Casella
And when the, and when this deal
- [03:42]
Brian Sullivan
is signed, is the United States going to immediately lift the blockade?
- [03:46]
Reporter/Interviewer
Yes, that's true. That's part of the deal.
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Megan Casella
Saying there that he understands the Supreme Leader has signed off on the deal. But a number of different Iranian state media outlets, outlets are all reporting that Iran has not yet reached a final conclusion about the agreement or signed off on any text. And Brian, the other caveat here is that even once finalized, it appears that this deal would be a memorandum of understanding that would launch negotiations on all of the more difficult issues, including things like what to do with Iran's highly enriched uranium and what to do about its enrichment program overall. So for now, we appear to be a step closer to reopening the Strait and, and getting perhaps a more stable cease fire in place. But the more difficult negotiations are all just getting started.
- [04:27]
Brian Sullivan
Yes. As we discussed when the news broke. Just to be clear, what we know about this is that this would be a framework, a deal of a deal or a 60 day pause on any aggression to create a later deal. Correct. This would not be quote, the deal.
- [04:44]
Megan Casella
That's absolutely right. And the President spoke for a long time in the Oval Office with reporters on this who tried to pin him down and get a few more of the details out of him. And we weren't getting a whole lot of clarity. At one point, the president was asked what sort of a deadline might be in place. You and I spoke earlier, Brian. Was it going to be 30 days, 60 or 90 days, at which point we would try to get a firmer deal in hand? And the president said, I don't want to put a deadline on that. I'll also flag that there was a fairly pointed statement put out by the Israeli prime minister's office, Netanyahu, where he said while Israel isn't a party to this MoU, he says Israel appreciates the president's commitment to a number of of these most difficult issues on enrichment infrastructure, on limiting missile production, on the cessation of Iran's support for its terrorist proxies in the region. Brian, just looking at those issues, these are things where there is no clarity that we'll be able to reach any sort of agreement with Iran on it. Clearly Israel is holding firm on still needing to get that done and that's what lies ahead even once we get this one framework in hand.
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Brian Sullivan
Yeah. And who we have negotiated with may not be some of the people that have control over the rockets, the missiles, the drones or the guns.
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Megan Casella
That's right.
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Brian Sullivan
So we'll see what happens. But for now, good news and the market liked it. Megan Casella, thank you very much. Stu Kaiser, Listen, we always say, well the market's not trading on Iran, it's only trading on AI. Well, I think today the move showed maybe that's not entirely accurate.
- [06:03]
Stu Kaiser
Yeah, I think to your point is good news. You know, the war was heating up again. It looked like we're going to get another shooting war. So it's good news that that seems to be kind of pushed off the table. To your point though, we had taken down the tail risk pricing in oil by about 75% over the last couple of months. So the market, equity market was largely kind of discounting that, that the cease fire remain in place. Again, you got some attacks over the last couple of weeks that I think had the market trying to reevaluate that. And the headlines today basically reversed that risk premium, you know, pretty quickly, Karen,
- [06:33]
Brian Sullivan
in a big way. I mean I think it helped that the market was up so the momentum was there, the buyers were there. This has kind of added a little bit of juice to the market, but are you a buyer?
- [06:43]
Karen Fineman
Well, I'm always long so I'm a buyer all the time. But I think you're right, it added some juice. I mean I don't know that any of us here would be surprised if this MoU didn't exactly come into fruition exactly over the weekend and as they hoped that wouldn't surprise anyone. So I think the market really shrugs off a lot of what used to be much more, much bigger reactions to around news than they do now.
- [07:08]
Brian Sullivan
We'll see.
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Karen Fineman
I think SpaceX matters.
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Brian Sullivan
Yeah.
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Karen Fineman
Also sentiment indicator.
- [07:12]
Brian Sullivan
I will add this so you don't
- [07:14]
Stu Kaiser
have to say it.
- [07:14]
Brian Sullivan
I'll say it. I've reported often there are numerous warring factions inside of Iran. It is entirely possible we wake up tomorrow and there's a headline of some kind of Iranian attack. And you're thinking I thought we had a deal or a framework of a deal. It's because there are multiple people asserting control in that country. So it's entirely possible, let's hope for peace. We have something totally different tomorrow.
- [07:36]
Karen Fineman
Yeah.
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Brian Sullivan
I think that's not named Space X.
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Karen Fineman
That's right. Well I think Space X is just the indicator, sort of a marker of a moment in time of euphoria or not euphoria or something. We'll see. But you're right, this is a difficult. Normally we don't see the sauces making this much. We don't hear about an mou. And then back and forth you hear about a deal, a diplomatic deal.
- [07:56]
Reporter/Interviewer
I mean, right. I mean you're talking about headlines are it's all green. But I mean 180 issues in the SP were down. 320, that's not a huge spread. Between the number up. We know that it was defensive stuff that was down. Staples are down, utilities down, energy down, but software was down. It's a major part of the sort of the market cap of the S and P and a major part of the economy mixed bag. I wouldn't say it's quite as good as the headlines and all the green would suggest.
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Brian Sullivan
But you're talking about pre this headline, right?
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Reporter/Interviewer
No, no, no. I'm talking about the close.
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Brian Sullivan
You're talking about the close. Are you even throwing a little.
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Reporter/Interviewer
The data is the data. 320 stocks advance 180. The S& P declined. Right. A lot of stocks didn't do as well as the market did. And in fact a very important area. Software was down along with other defensive things. Not to say the software is defensive. Utilities were down, staples were down, so forth.
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Brian Sullivan
Okay, so facts matter. So it's matter, facts, bottom. When I said facts matter, he just gave the facts. I also know the S and P rose 2%. The Nasdaq was up 2 and a half percent. So something mattered today. What mattered to you?
- [09:01]
Bono
Listen, I think it's tough to argue that the whole situation around Iran and the straight up promotes is not impacting markets. Today's price action, top line to Carter's point, albeit it's still very impactful, we're talking about several percentage points in terms of reversal today. Again, I want to underscore that Carter brings up an important point, but I think that that condition has held true. If you look at the week ending June 2nd, we still had a situation where despite that rally, it was very narrow in scope. So in terms of concentration of advance and decliners, that has been the condition over the last several weeks. So I do think it is noteworthy, but it's not inconsistent with what we have seen leading up to this. I think the other thing that's important is the inflationary backdrop. We got CPI and PPI numbers. There seem to be some divergence between core and the headline number. And I think any alleviation that we get on energy and input costs around this Iran situation definitely is positive for stocks at the market.
- [10:03]
Brian Sullivan
Yeah, it was a positive day today. All right, Stu, we're going to jump ahead in the rundown, as we say, because I am told there is something big happening here tomorrow. That event is the Space X ipo. It is going to be the biggest IPO in American history. It may be the biggest in global history, $1.7 trillion cap, but the float not expected to be too much. We're hearing four, maybe five times oversubscribed. I understand you guys at Citi on the book, so you can't go into the Space X details, but can you talk to us in a macro way about what it might mean for the market writ large?
- [10:43]
Stu Kaiser
Yeah, I think what you're seeing here is a lot of excitement about, about that IPO in particular, but, but bigger picture. You know, there's a view that you have multiple other IPOs later in the year. You had Metta, you had Amazon, you had Google on the tape last week, you know, kind of introducing more equity supply. You've had convertible bond supply, you've had IG bond supply. So I think what you're seeing here is over the last couple of weeks, the market's kind of reevaluating the amount of supply of new assets that are going to hit the market both this week and also for, for the balance of the year. And I think that's one of the reasons you're seeing kind of a mixed tape lately. And you know, I would expect that, that part of it to continue because it is a lot of supply across asset in large cap tech to fund this build up.
- [11:21]
Brian Sullivan
Well, let's get more details on what I'm told is a pretty big deal. You know what else is a big deal? Leslie Picker. And she's going to join us now because we, we've got some details Leslie, but I think we're still waiting on details on you know, size and indications and can you pick see what I did? There a time where we think we know when the first trade might occur.
- [11:48]
Leslie Picker
Oh gosh. It's anyone's guess at this point in time, Brian, when the first trade will be. But I would bet you should set aside some time in the afternoon, maybe between 1 and 3. This is the largest IPO ever as you point out. So we've never really seen how long it will take to open something that's $75 billion in size. And SpaceX just, you know, within the last hour and a half or so saying in a filing that it has officially priced at $135 per share now the largest IPO of all time officially. I've been chatting with sources close to this one on how the book all came together. I'm told that in the end it was almost five times oversubscribed. In other words five times as many indications of interest as there were shares available. Those are non binding orders though. Now the process begins where the banks and brokerages will reach out to investors to inform them how much allocation they actually received and those orders will come through. In terms of the makeup of the offering, I'm told retail is going to get the low 20s percent of the IPO. That includes private bank clients, international retail and E brokers like Robinhood and SoFi. I'm told that domestic retail demand was a lot bigger than international but it's a deeper market and one where in Musk of course has a long track record of retail support. Still that low 20s number slightly smaller than the 30% we had been told the company was targeting. I'm told the top of the book is pretty well concentrated among long onlys and that there were cutbacks in the middle and the bottom of the book, largely hedge funds that put in what the bankers perceive to be highly inflated orders. Now we'll see if the cutbacks were high enough to stimulate equipment aftermarket demand tomorrow when the shares begin trading. At what time, Brian? I couldn't tell you but hopefully it happens sometime tomorrow afternoon.
- [13:43]
Brian Sullivan
I would say. Leslie Picker, thank you. And I would. I'm just 201pm Eastern time would be a perfect time for Space X to begin.
- [13:52]
Karen Fineman
Happens at 201, right?
- [13:53]
Brian Sullivan
I don't know. I just randomly grabbed that time out of the air. I'm 202159 somewhere around that the oh
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Reporter/Interviewer
one it makes it well right.
- [14:02]
Brian Sullivan
You know welcome to Power Lunch Space X is trading. Sounds nice. Leslie Picker, we'll see you in like five hours back on CNBC Live. Leslie, thank you. Karen, your take on Space X.
- [14:13]
Karen Fineman
Well, it's fascinating as a sort of moment in time. You know, if I'm very value oriented, the fundamentals here are sort of hard to.
- [14:21]
Brian Sullivan
Not value or not value oriented.
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Karen Fineman
Exactly. I mean, it's, it's. I mean, a couple of things have happened that one could consider negative. But they, I don't think they will be. You know, the blue origin blow up last week, you could say, oh, it's positive because that's competitor or it shows a lot of risk in the business. The other thing is, you know, the. I don't know who from Iran, you might know better than I said about Elon Musk Properties, Starlink and whatnot that they would be considered, you know, viable targets. Right. That's probably also not a good thing, but maybe let's dismiss that as well. Just the aura around Elon is so extraordinary that I think it will trade, it will trade up decently. Probably not where it would have two or three weeks ago, for sure. But does it. 25%. How?
- [15:07]
Brian Sullivan
Well, if the stock goes up 100% or 80% or 10%, does it matter?
- [15:13]
Reporter/Interviewer
Matters. It doesn't go down. Remember when, when, when, when underwriters would hold, they would never let it break, deal breaks because that would be embarrassing.
- [15:19]
Karen Fineman
Is there a syndicate bid at 130
- [15:20]
Brian Sullivan
saying that's going to happen? It has happened.
- [15:22]
Stu Kaiser
I don't think it's going to happen tomorrow.
- [15:24]
Reporter/Interviewer
I think, you know, the incredible thing is it just shows how darn big Saudi Aram. The valuation of that IPO was 1.7 trillion. That was in 2019. The valuation of space is 1.7 trillion. The S and P has more than doubled since then. So on a percentage base, it just shows how big Saudi Aramco's IPO was. This is the same five years later in a market that's doubled. So on a relative base, that's still the biggest by far of all time.
- [15:49]
Brian Sullivan
All right, for more on this, let's bring in Laura Rippey, managing partner at Alumni Ventures. Laura, you do this for a living. Good to see you as well. Wish you were on set like you normally are. What do you make of Space X? What is. Why does it matter so much? Why are we so captivated by this?
- [16:06]
Laura Rippey
We are, aren't we? It's a big day, Brian. Yeah. I think the venture perspective on this is the unlock that comes after Space X. Right. We've got incredible talent within the company. We've got a whole bunch of capital that gets unlocked once the IPO happens and then a whole slew of new companies can be formed. So for us it's looking around the corner and understanding where the space economy can go and how this is just an incredible unlock for the venture industry. We couldn't be more excited.
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Brian Sullivan
How? Connect the dots. Why does this one matter so much for the venture industry? Because there's this, there's this Elon Musk guy that when he gets involved in things it tends to generate more attention. But does it seep through to the 99.9% of the market? That's not Elon Musk.
- [16:57]
Laura Rippey
Yeah. So let's put this in context of what happened when dropped the cost of hosting by 97% suddenly we had a whole boatload of companies like DoorDash and Airbnb and the like because hosting costs cut down. In the same way with SpaceX. The value that SpaceX has brought to the space industry is reducing the cost of getting loads from the earth to low earth orbit. So that suddenly says we can do things like manufacture in space. We need the communications for space. We have an entire defense opportunity in the space world. We have logistics that need to happen, moving things around. All of those companies future incredible venture backed superstars that get unlocked because Space X has a position in the space economy to really grow it. And with this new capital it is an exciting moment in time for the space economy.
- [17:58]
Brian Sullivan
So you must see a bunch of companies that we don't get to see. You know, smaller startup private companies, you guys invest in alumni ventures. I hate to use the term halo around a space company, but I have to do it because I don't know what else to do. So it's not a dad joke, but how, how big is the Space X halo then? For other companies it's very large.
- [18:20]
Laura Rippey
So last year there was $55 billion of venture capital that went into space economy companies. Great example. We've done a lot of this, right? Varda, Axiom, Northwood, Hawkeye. The one that I would highlight is Impulse Space because it really speaks to the fact that there is talent and there is also capital that gets released. So Impulse Space, his the founder is the first employee at Space X. Tom Mueller. He was literally Elon Musk's first hire. The president and chief operating officer was the number 13 employee. So the classic example of talent that leaves Space X and starts something else. Now we've been backing Impulse Space since the a. We're going to be. We're going to see they just did a D, a 500 million dollar D. And the lead investor was a venture capital firm that has a very significant early position in space X, a $10 billion value position. Right now they just raised a big round and now they're backing Impulse Space as the heir to the SpaceX future. Because what Impulse Space does is really pick up where SpaceX leaves off. SpaceX takes loads from the Earth to low Earth orbit and Impulse Space moves those loads more broadly into geo, into the, to the further space. So really tied together with talent and capital. It's emblematic of what we're going to see in the space economy with this ipo. Could not be more excited.
- [19:52]
Oliver Renick
Wow.
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Brian Sullivan
I just looked on the website. They have 145 open positions for jobs. Impulse Space, they want to hire 145 people for a company that probably has 145 people.
- [20:05]
Laura Rippey
Yeah. To $200 million in booked, booked revenue. So they need the people to deliver on that revenue.
- [20:13]
Brian Sullivan
Yeah. Pretty amazing stuff. A rocket ship called Ride Share. I hope we're on it someday. Who knows? Laura Rippey, thank you very much folks. We don't need to say this, but be sure to tune in to CNBC all day Tomorrow starting at 5am Continue coverage of the Space X IPO. Kick it off. Morgan Brennan's got a big interview with the CEO of Space X. Then you've got the opening bell at the nasdaq and then we're going to wait for that thing to open up. Full team coverage. 5:00am Anybody want to like just Bono and you got like a, like, should we do like a pool? Like a World cup pool? Like when this first trade will happen? Just guess a time. Let's have some fun with it.
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Bono
I thought with the pools you just fill out these random sheets and then the numbers are assigned thereafter.
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Brian Sullivan
So.
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Stu Kaiser
Sure.
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Bono
I mean if you want a random guess. Who are you? 201. I'll raise your 201 to 209.
- [21:03]
Brian Sullivan
Prices right at me. It's unbelievable, Carter, you want to just take a guess on a time?
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Reporter/Interviewer
I'll split the difference. Put me in at 205.
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Brian Sullivan
Look at that. I love it, Karen.
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Karen Fineman
All right, well, I'll go in at 9:30 and I have all that open space between then and two.
- [21:17]
Brian Sullivan
Oh, that's right. Because if we go over, we lose.
- [21:19]
Karen Fineman
Exactly.
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Brian Sullivan
Okay. Karen Fineman with the as usual out, thinking us off. Coming up, shares of Lennar, the home builder on the move. After reporting the details and numbers to the homebuilders quarter next. But first, Oracle's big software. Slide the shares down today because they're selling more stock. What our traders make of that drop and more when fast Money returns right after this.
- [21:47]
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- [23:19]
Brian Sullivan
All right, welcome back to Fast Money. Oracle shares sliding as much as 11% today. They did in the day off their lows. The market came up drop coming after the company said it is planning to offer an additional $20 billion in capital raise and expecting negative free cash flow. Shares now down about 6%. Karen, on the year your take on Oracle.
- [23:40]
Karen Fineman
So clearly the street was somewhat surprised, sort of not about the capital raise but we've seen it, you know, starting with Google and as you said at the top of the show, all the others coming to market in the same space. So that's going to be difficult. Also the software part of the business was disappointing so that was sort of adding to the IGV today. The RPO is good, but we just need to go from RPO to actually, you know, building the product and actually delivering. So that's the hard part. I don't own it. It's not crazy expensive but I'd rather play it other ways.
- [24:19]
Stu Kaiser
Yeah, I think the car's point of it. This just sort of checks all the boxes of what people are worried about in the space. Right. The software revenues are great apparently and you're raising more cash and you have negative free cash flow. I mean it's funny, I think in September I was on the show the day Oracle reported and it was sort of a similar reaction. In that case the stock rallied but very quickly, you know, people started to fade it, you know, for all these reasons. I think negative free cash flow has just really become a huge talking point across, across large cap tech. And they've checked that box again.
- [24:44]
Karen Fineman
Was the day with the. Sorry. With the giant rpo. That was just the mind blowing rpo.
- [24:49]
Stu Kaiser
Yep. And the interesting takeaway back then was it's great they want to do this. The problem is they're not going to have the supply to do it, which is proven prophetic. Right.
- [24:57]
Brian Sullivan
You're not talking about run pass option rpo, nor are you talking about an R, E O and a speedwagon. Can you explain what the RPO means?
- [25:03]
Karen Fineman
Remaining performance obligation. What backlog, what order? What is the backlog of orders to fill?
- [25:08]
Brian Sullivan
Thank you. I was asking for a friend. Bono and Eisenhower.
- [25:12]
Bono
There's a couple of things at play. You have the XAI or sorry, the OpenAI concentration, which is somewhat concerning there. And then when you look at IT versus Visa, Visa, its peers, you have all these other hyperscalers that have essentially been able to use their massive free cash flow balances to fund these capex plans. And Oracle is on the other side of that spectrum. So when you just kind of look at a situation that's kind of been under scrutiny as of late and you add on top of the leverage and increasing leverage and then they're signaling of when this RPO will transfer late just makes for a much more precarious situation. Stock is almost round tripped what it's done off of the bottom after that 330 high.
- [25:52]
Brian Sullivan
Bono, do you think that Oracle is reflective of AI at all? Or is Oracle because of its debt load, because of its kind of coming in hot, not set a left field, but it's not a Google in a way. Is Oracle reflective of anything else?
- [26:07]
Bono
I think it kind of is in between, you know, your bellwether or let's say household names in terms of AI and the more speculative aspects because of their, their need to tap the capital markets. So when you look at companies that aren't making money yet, clearly that's all the Way out on the speculative spectrum. But if you're looking at the fact that they're now having to massively change what their balance sheet looks like to continue to meet these RPOs, it kind of is in the middle. And I think because of that, it gets punished when there is opaqueness in terms of what the revenue outlook looks like.
- [26:44]
Brian Sullivan
All right, good stuff. All right, coming up, we're going to shift from software building houses. Lenore on the move after reporting earnings. We'll get the details, we'll get the numbers, the trade coming up next. You are watching Fast Money live here at the home of the Space X IPO tomorrow. Karen said you're not going to sleep tonight. We're back right after this.
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- [28:42]
Brian Sullivan
All right, you see the earnings alert. There you go. Lennar shares are on the move. They reported their second quarter results. Revenue coming in slightly under Wall street estimates. Diana look has more on the numbers and what's going on, Diana?
- [28:56]
Diana Look
Well, Brian EPS was in line, but revenues light due to lower home prices. I'll get to that in a second. But investors and analysts were watching margins and homebuilding. Gross margins came in at 15.6% versus estimates of 15.7 Q3. Margin guidance was in line at 16% now margins have been dropping as Lennar looks to push volume using incentives and lowering prices. The average price of a Lennar home in Q2 was down 5% to $371,000. Lennar executive chairman Stuart Miller noted stubborn headwinds of mortgage rates, constrained affordability and cautious consumer sentiment. Adding the gap between our current incentive levels of 12.9% and normalized levels of 4 to 6% is narrowing for the first time in three years as the mismatch between higher home prices with higher interest rates and household income is narrowing as wages drift higher and employment remains strong. So the good with the bad as you take it, Brian.
- [29:52]
Brian Sullivan
Yeah. And I heard you earlier saying, you know, listen, this mid level kind of muddling along high and doing okay, lower end hurting.
- [29:59]
Megan Casella
Yeah.
- [29:59]
Diana Look
And that's why actually analysts at KBW downgraded Lennar earlier this week because they are more the entry level builder and upgraded toll, which is your luxury end. Because the luxury end is doing better. The entry level and the mid level even not so much.
- [30:12]
Brian Sullivan
Daniel, thank you very much. Chartmaster. How do the charts on Len look?
- [30:17]
Reporter/Interviewer
Well, it's an unhappy chart. Let's just say that mean this is a stock that' forming its peers, underperforming the market and is at 23 year lows. Home builders in general, even the ones that are related, Home Depot, Lowe's, it's not a great area of the market.
- [30:32]
Brian Sullivan
Yeah, that was a pretty nice way to say don't invest.
- [30:36]
Reporter/Interviewer
Yes.
- [30:38]
Karen Fineman
Is it a pair of two wells
- [30:42]
Reporter/Interviewer
about relative performance and this is very poor relative performance. The other choices in the market market are better.
- [30:47]
Brian Sullivan
So if interest rates move well, that's
- [30:51]
Reporter/Interviewer
always the burden on these stocks as well. They're interest rate sensitive. But as an operating business here and now, it's nothing that I would put capital into.
- [30:59]
Stu Kaiser
Yeah, look, I mean the US economic data looks great and the home builders just, you know, can't seem to find a bid to them. I think it's partly interest rates, I think it's partly pressure on consumer from Iran and higher oil prices, etc. I would say if you're excited about the US economy, it's a domestic cyclical, so I can see people wanting to have some exposure there. But big picture, to Carter's point, this is a part of the market that just can't seem.
- [31:18]
Brian Sullivan
But there's such a shortage of housing. It's all we hear about. There's no homes for sale, no supply. You think people would just automatically buy the new homes.
- [31:24]
Stu Kaiser
That's because. Because you live here though, right? I think, I think in a lot of, I think in a lot of the rest of the country that it's less, it's less the case if you look at regional kind of real estate prices.
- [31:33]
Brian Sullivan
I know east coast bias, I admit it. Stu Kaiser, right as usual. All right, coming up, how Stu Kaiser is navigating the recent market volatility. We're going to ask him where he's putting money to work. My guess is it's not Lennar, but we're going to find out. Fast Money back in two. Missed a moment of fast. Catch us anytime on the go follow the Fast Money podcast. We're back right after this. All right, welcome back. Stock surging. President Trump today canceling his threatened strikes against Iran set potentially for this evening and saying that the framework of a peace deal is near. The market was already up. But on that news, the Dow jumped even more, closed up on the 900 points S&P up more than 1.7%. The Nasdaq leading the gains, rallying more than 2 1/2 percent. More after hours action include Adobe lower despite topping earnings and revenue estimates. RH Restoration Hardware, the furniture company topping expectations on both the top and the bottom line. In the meantime, gold actually today got a bit of a pop after those strikes on Iran were a little bit called off. But the metal is still down nearly 20% since the beginning of the war. The miners hit even harder, down 33% since their peak on March 2nd. Carter Worth at the Big Monitor, Are the charts saying the miners are due for a bounce?
- [33:12]
Reporter/Interviewer
You know, that's my thought as a short term trader. We're going to look at it. But what was so good, 30 to 120 that blows away everything has turned into a disaster. It's actually from its absolute peak to its absolute low, we are down 37%. And the question is independent of whether you believe there's a huge topping out formation for a trade, I think you can catch this for a bounce. So if you look at the next chart, we have these well defined converging trend lines and we have broken down from the apex of that formation. My hunch is here and we had a good action today that we're going to throw back a bit and get back up into where the breakdown level occurred. The breakdown level is very clear. You can see to the penny, to the penny, to the penny and then the break. And my hunch is you play for a trade here back up to around 85 plus minus on GDX.
- [34:04]
Brian Sullivan
All right. Carter Worth Come back on over here to the set, we'll talk about it. More of a bottle and ice and you got to take on the miners.
- [34:11]
Bono
Yeah, I tend to like the trade. I mean, it's going to give you a little bit more beta than owning gold or I mean, that's probably what our viewing public is how they're investing rather than futures, the actual commodity. So I think it gives you a little bit more beta than gold. And ultimately it's not just the war, it's the whole hawkish narrative. The higher for longer narrative, you know, the debasement trade is kind of rolled off, but the higher for longer narrative, I think it's really what's been weighing on gold. And if you have some type of resolution in the Middle East, I definitely think that is supportive of gold and the miners probably to a greater extent.
- [34:45]
Brian Sullivan
Stu.
- [34:46]
Stu Kaiser
Yeah, look, on miners specifically, it's weird. It used to be a defensive trade. Now it's become basically a positioning, sentiment trade. So I would agree with these guys. If you get relief on the Iran side, then you probably get a sort of a positioning bid to that asset and it continues to behave again more not like a bitcoin, but more like a sentiment trade than a defensive. I'm going to hide in gold for now.
- [35:05]
Brian Sullivan
I'm Carter. I just kind of gobsmacked about gold. It's like, it's like the Knicks game last night and gold is the spurs. Because for 3, 3/4, unstoppable gold was every day new high for gold. New high for gold. New high for gold. Sure. Blowing away, semis even suddenly over.
- [35:21]
Stu Kaiser
Right.
- [35:21]
Brian Sullivan
What happened?
- [35:22]
Reporter/Interviewer
And so. Well, it's just great. Excess has to get. There's mean reversion.
- [35:25]
Stu Kaiser
Right.
- [35:25]
Reporter/Interviewer
I mean something going, tripling, quadrupling. But the question is not so much the why. And there might be the why that you all have cited the war. This I'm really in the what business. And what I see just from my eye and others might see differently is that down 37% is a fairly extreme move. We're due for some sort of counter trend. So short term trade miners on the long side.
- [35:46]
Brian Sullivan
All right, coming up, it is not just stocks. Space X Options may take a few days to start trading after the ipo. But that wait is not stopping options traders from getting in on the action now. Talk about how they're doing it, how they're playing. The blockbuster debut. Next, As our country celebrates its 250th anniversary, CNBC spotlights the leaders driving business and the nation forward.
- [36:20]
United Airlines Representative
If I had to describe American enterprise over the last 250 great years in one word, I would say optimistic. Because here in the United States, we always, always, always try to get better. We're never satisfied with anything that we're doing. Somebody always has great new ideas. When I think about the Wright brothers, I don't just think about the Wright brothers. I think about all of the science and technology and products, all of the innovations that started right here in the United States. And it really is a unique asset that the United States has and it's part of what makes us the greatest country in history. I'm proud of the hundred year history at United Airlines. We really are deeply intertwined with U. S. History. United Airlines started 1926, originally flew mail and then expanded over the centuries to, of course, flying passengers, flying cargo, flying around the globe, globe. It's been a journey of constant expansion. I think my personal history, you know, is a perfect example of what is possible, what makes this country great. You know, grew up in a middle class household, you know, was able to get to get to go to the Air Force Academy. First time I ever walked onto an airplane, however, was when I walked onto the flight to attend the Air Force Academy when I was 17 years old. It's a country of opportunity. And if you pursue it, if you have good ideas, if you work hard, if you're successful, you can just move up and up. We're fortunate here in the United States. What the founding fathers gave us is just incredible. And the culture that we've built and the society that we have is strong. Even though there's sometimes ups and downs and it can be maddening and frustrating at times, that culture, that history that the founding fathers bequeathed to us 250 years ago is going to see us through the next 250 and beyond.
- [38:08]
Brian Sullivan
All right, look at that. A quick programming note. Do not miss the latest episode of how she does it with our own Karen Feinerman in it. Karen sat down with Carrie Firestone at the CNBC pro event wealth for Women. The episode is now on Apple, Spotify or wherever you may get your podcast. Check it out. All right, SpaceX making its hotly anticipated NASDAQ debut. I mean, I don't know if you heard about this. It's going to be the largest and most hyped IPO of all time. The options start trading on Tuesday, so a couple of trading days from now. But the action is already telling us that the appetite for those options is through the roof. Oliver running at CIBO in Chicago with more. So if they're not trading. Oliver, how are people expressing this excitement?
- [38:55]
Oliver Renick
Proxy stocks, Brian, Proxy stocks. We've been following two closely tied to Space X this past week. EchoStar Ticker SAT, the $35 billion networking business that owns 3% of Space X shares, following a spectrum deal with Starlink and AST Space Mobile, another mid cap company whose satellites will take flight on a Falcon rocket next week. Options bulls can't seem to get enough of either with calls outpacing puts 5 to 1 in Echo Star and 4 to 1 in AST. In both, roughly 10 times more calls were bought than puts today. And in both, implied volatility is astronomic. But that's what traders have been drawn to and what we expect for SpaceX options out of the gate On Tuesday. For example, today one trader, we saw an Echo Star put on a call spread buying $1.2 million of the 130 strike calls and selling just under 200,000 of the 150 strike calls expiring tomorrow. And those 130s are now less than two bucks away from the money, Brian, after today's 11% rally.
- [40:00]
Brian Sullivan
So they found stocks that are ish and they're doing that.
- [40:06]
Oliver Renick
That's right. As close as they can get. And honestly, the fireworks might be Tuesday, Brian, because as we know, options have been such a powerful force for these high momentum, high beta trades. Obviously going to be a closely watched IPO tomorrow. And at 135 bucks a share, that's really kind of the nominal sweet spot for stock prices that options traders like
- [40:24]
Brian Sullivan
to pay up big.
- [40:25]
Oliver Renick
Implied volatility, these four.
- [40:27]
Brian Sullivan
Fascinating. Oliver Renick. We'd expect nothing less. Appreciate that, Bono. And I mean, listen, what am I going to ask about Space X right now that you have been asked 100 times? How about this? What to you is the one thing, stock options, whatever. What's the one thing you're most watching about this ipo?
- [40:45]
Bono
I mean, I'm an options guy, right? So when the options are actually listed, I want to see one what the opening implied volatilities are because to me, I think that's really what's going to determine the best way to trade this or at least a tactical way to trade it. Assuming that this is triple digits or high double digits, you probably want to be neutral volume, if not a net seller of all, if you were fortunate enough to be allocated at the IPO price, why not sell an upside call and take some of that options premium in and you'll have a chance to re enter and size up when the Appropriate time presents itself.
- [41:18]
Karen Fineman
Also if you're not a huge, very deep pocketed retail trader and you got maybe a little or you didn't get any at all and the stocks, you know, well, north of 100 options are really your best bet to do, to do something until they do fractional shares, which they don't. So it's like when a stock splits, it creates value because option traders can then buy some. No value is actually created from a split.
- [41:42]
Brian Sullivan
And in a very Elon Musk move, the number of shares being offered are 555,555,555. I have no idea why, but it just seems very is Muskian. Can we use that as a verb?
- [41:57]
Stu Kaiser
Definitely.
- [41:57]
Brian Sullivan
Right. All right, coming up, if you missed it, I mean we're all horse because of the basketball game at Madison Square Garden last night. The Knicks completed the biggest comeback in NBA Finals history. And it's not just Knicks fans jumping for joy. There's actually a stock impact to the story. We'll tell you about it coming up. Ball here on Brunson and OG an is going to have a free run at this because there is two on the pole. I mean look at that. Brunson misses the shot. It's got Wemby's hand in his face. 7 foot 4. Then you get the rebound. That OG Anunoby's game, is it a shot? His game winning shot? It was a tip. I don't think that was a shot.
- [42:58]
Karen Fineman
Yeah, it was a tip, right.
- [43:00]
Brian Sullivan
Either way, that tip, the tip heard round the world propelled the Knicks into the history books, wiping out a 29 point deficit in the second half. They beat the Spurs 107 to 106. Arguably the greatest NBA playoff comeback ever. The Knicks haven't done it yet, but it's three games to one. And get this shares of Madison Square Garden sports kind of feeling. The knicks effect up 19% since the team's first playoff game in April. And the gaming stocks also moving on the playoffs. Draftkings Soaring more than 22% over the past month. Flutter, which is FanDuel up 18%. The question is, does the winning streak continue or is this just like this short term, let's trade it because the
- [43:47]
Karen Fineman
Knicks, well if they spin right, they're talking about spinning the Knicks right. And the Rangers, I think if they actually to just spin the Knicks and have pure play Knicks, I think it would trade extraordinarily well. And if they sold it, you know we had Talked before about 10 billion. I think it's north of 10 billion. There's just too many rich people who would want to own a part of the name.
- [44:09]
Brian Sullivan
And maybe that's why the stock moved. Maybe not on the fan excitement as much as the valuation of the team going up. Because unless they screw it up, which they could, Carter ain't over till October. They haven't won a title since 1973.
- [44:23]
Reporter/Interviewer
But what are the odds when you're up three. One coming, losing, not very.
- [44:27]
Stu Kaiser
Odds are winning 37 out of 38.
- [44:29]
Reporter/Interviewer
30. There you go, isn't it?
- [44:31]
Brian Sullivan
So if you're up three games of one, so hard. So the Knicks don't want to be that 38.
- [44:38]
Stu Kaiser
And the previous. The previous one was LeBron coming back against Golden State a few years ago. He was in Cleveland. Everybody wants trades that are not correlated to I being long. The Knicks is probably not correlated to AI.
- [44:48]
Reporter/Interviewer
Right?
- [44:48]
Brian Sullivan
And it was like last night, I tweeted out because I was watching. I got home from D.C. at halftime, I turn it on, they're down by 27. And I was like, I'm gonna turn it off. But I just kept it on. Thank God I did. But it's like you watch the. The game and it was like a 90s sitcom with a basketball game at Seinfeld. Larry David, Chris Rock, Tracy Morgan. Who am I missing? Ben Stiller.
- [45:11]
Reporter/Interviewer
McEnroe, in his own way, was kind of a sitcom.
- [45:15]
Karen Fineman
Yeah.
- [45:16]
Brian Sullivan
Spike antics. But then you also had Timothee Chalamet. You had Taylor Swift, Mike Bloomberg sitting next to. There's Taylor Swift, Mike Bloomberg sitting next to Timothee Chalamet was probably my. There's Timothy Chalamet. My favorite meme because it was like Mike Bloomberg and Chalamet. There's Alan. I don't know how these guys got in. Up next, your final traits. Final trade time. Bottom of a. Nice. And kick it off.
- [45:56]
Bono
I think there was some follow through in the Middle East. Will be a boon for airlines. I'm going with Delta.
- [46:01]
Brian Sullivan
Delta. Stu Kaiser.
- [46:02]
Stu Kaiser
I'm going to keep it. Keep it pretty basic. Stay with the earnings momentum. Stay with Triple T's.
- [46:06]
Brian Sullivan
All right. Karen Feineman.
- [46:08]
Karen Fineman
Yes. I sold some of my Meta foot protection this morning. Got a little lucky on timing. So beat long Meta. Thank you, Brian, for being here. Long day.
- [46:18]
Brian Sullivan
Long Meta. Carter Worth.
- [46:20]
Reporter/Interviewer
Coal miners. You get that done with the etf, gdx. Buy them.
- [46:24]
Brian Sullivan
So your final trade is the chart that you showed. Yeah, the bounce.
- [46:27]
Reporter/Interviewer
I mean, you know, that's sort of a smart way to do it, right?
- [46:31]
Brian Sullivan
Enough for the chart.
- [46:31]
Reporter/Interviewer
Yeah, it's good enough.
- [46:33]
Brian Sullivan
It's been a long day. It's hot outside. I'm all worked up. Markets were hot. Thanks for watching. Matt starts right now.
- [46:39]
Fast Money Disclaimer Narrator
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.
- [47:11]
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