← CNBC's "Fast Money"
CNBC's "Fast Money"
The Global Rate Rally… And All The Headlines In The Weight-Loss Drug Space 3/19/26
00:43:18
Rates across the world are climbing as central banks raise inflation warnings. How yesterday’s Fed decision sets up a potential rate *hike* at the bank’s June meeting, and when the recent jump in yields could finally hit the equity market. Plus, Eli Lilly’s latest trial data, Novo’s FDA approval, and the patent expiration that could shake up the weight loss drug space. Fast Money Disclaimer
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- [00:00]
Melissa Lee
What does it mean to live a rich life? It means brave first leaps, tearful goodbyes and everything in between. With over 100 years experience navigating the ups and downs of the market and of life, your Edward Jones financial advisor will be there to help you move ahead with confidence. Because with all you've done to find your rich, we'll do all we can to help you keep enjoying it. Edward Jones Member, SIPC Attackers are already
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- [00:53]
Melissa Lee
Live from the NASDAQ market site in the heart of New York City's Times Square. This is fast money. Here's what's on tap tonight. Markets bouncing off low late in the day with stocks closing well off their worst levels and rates pulling back from the year's highs. But will central bank fears about inflation come home to roost? We'll debate that. Tipping the scales, Eli Lilly's new obesity drug, clearing a key clinical test, the details and what it means for the all the players in the GLP1 space. Plus some surprisingly good news for Apple on the AI front. Rivian inks a major Robotaxi deal with Uber and Baba busted shares of the Chinese tech giant hitting more than six month lows after earnings. We'll dig into the numbers, find out whether it can be it can rally from here. I'm Melissa Lee, come to you live from Studio B at the Nasdaq. On the desk tonight, Tim Seymour, Karen Feynman, Steve Grasso and Guy Adami. And we start off with stocks trying to stage a late day comeback, closing the day well off their lows after Benjamin Netanyahu said Israel was helping the US Open the Strait of Hormuz. The news also sending rates and energy prices off their highs. The two year hit nearly 4% earlier in the session but retreated while WTI pulled back after topping 100 bucks a barrel. Still elevated oil prices due to the war in Iran had the most central banks raising the flag on inflation this week. The Federal Reserve raised projections for inflation this year. ECB noting the conflict will have a material impact in the near term through higher energy prices. The bank of Japan adding attention should be paid to the impact of rising crude oil prices on the outlook for underlying consumer inflation. And the bank of England saying the risk of higher domestic inflationary pressure on will be greater the longer higher energy prices persist. All this commentary has made markets price in a greater chance. The Fed hikes rates in June rather than cuts them. So when will these fears of higher inflation take a toll on the stock market? Just today JP Morgan trimmed its S&P price target from 70500 to 7200. Should there be more to come? Guy, what do you say?
- [02:51]
Steve Grasso
It's amazing. So we play the game. If you had told me this would be the case a few months ago, where's the S and P? Like decidedly lower. But the fact that now the market's pricing in basically no cuts and maybe a hike, which I don't think is going to happen and the market's hanging around, that's actually very encouraging if you think about it. Now to answer your question, there are definitely some headwinds out there and The Vix hanging around 23 suggest there's another leg here. But the fact that the market seemingly is okay with a year of no cuts is pretty. I think it's a good way to look at the world right now.
- [03:21]
Guy Adami
This is a rare day where Guy might be more bullish than I am and I just have to note it for what it is. I thought ECB was very hawkish today and in fact you've priced in 70 bips of hikes in Europe this year. Europe of all the major regions and economies we think has probably got the least, you know, the least foundation underneath the growth and the turnaround that we had seen the most vulnerability to energy prices. It's a day when we took a step deeper into the length of at least how long there is disruption or a pressure on oil prices. Largest LNG plant in the Middle East, Saudi's Yambu field gets gets hit and the first at attack really on Saudi from Iran during this conflict. And whatever you want to believe the way the markets have done for the last three days is in Asian hours, in European hours. They priced in as if there's not there's escalation in the war and that in fact we're further along into long term damage. Then as you get into the US day you have US policy officials, US at least policy and officials talking about that there is de escalation and that there's a dynamic and you know, believe who you want but that's the price action that we've seen over the last couple of days. And I, I think the energy infrastructure hits are a big deal and I think inflation as we heard from both the central banks and we're starting to hear it even from the companies themselves, I think is something that we should be paying more attention.
- [04:45]
Melissa Lee
The hits by the US And Israel, I mean, that opens the door to retaliatory hits.
- [04:50]
Guy Adami
Absolutely.
- [04:51]
Melissa Lee
Infrastructure, which would mean that inflationary pressures are more embedded Right. Into future expectations than we think right now.
- [04:58]
Karen Feynman
Well, yet Tim was talking about the EU having more vulnerability to oil prices. Obviously, the US is in a much better spot. Also, I don't think we've yet seen them really kick it, Kick up their spending for defense. There's a lot of talk about it, but they might actually have to do it at the same time where things are very difficult and expensive at home. So the mega trade, which I like the idea of the mega trade is under some extra pressure right now. Obviously, for Japan, this hasn't been great either. But I'm surprised the market hangs in here as well as it does. I think it's hard to see one cut now. Only one, But I still think one seems right now, I know Trump was saying, why would you cut right now? Why wouldn't you cut right now? I sort of think, why would you cut right now with what's going on with energy? Yeah.
- [05:54]
Melissa Lee
I mean, claims are really sort of a minor league, you know, data point for the jobs market. I mean, but claims sort of was okay. We're okay. Yes. So it's like, oh, maybe, maybe the job market is not under stress, if that changes.
- [06:06]
Karen Feynman
I understand.
- [06:07]
Melissa Lee
Right.
- [06:07]
Karen Feynman
But that didn't.
- [06:08]
Tim Seymour
But there's no. But there's no reason for a rate hike, though.
- [06:10]
Karen Feynman
I agree.
- [06:11]
Tim Seymour
And even Powell said that yesterday.
- [06:13]
Karen Feynman
I agree.
- [06:14]
Tim Seymour
Powell said yesterday no interest in a rate hike. Didn't talk about a rate hike. It's either flat or down from here.
- [06:22]
Karen Feynman
I could see flat from here.
- [06:23]
Tim Seymour
Yeah, but he's out. I'm sorry, he's out. He's out in May.
- [06:27]
Karen Feynman
Or not.
- [06:28]
Melissa Lee
Or not.
- [06:28]
Karen Feynman
Or not.
- [06:29]
Melissa Lee
Might be there much longer.
- [06:30]
Karen Feynman
I don't understand why the dog could. I mean, this is. It was sort of an exit ramp here.
- [06:34]
Melissa Lee
Right. Like I said. Okay, goodbye. Just run out the clock.
- [06:37]
Karen Feynman
Run out the clock and he'll say, fine, I'm going to.
- [06:39]
Tim Seymour
Through that prism. Maybe then you can say there'll be a hike. If he's still around, then maybe there'll be a hike. But if he's not around, there's not a shot they hiked.
- [06:48]
Guy Adami
Well, the presumption is that Powell's hanging in there for hikes. He's a guy that stands alone. I mean, I think the Fed has been largely together on this One. So I just think we're in a dynamic here where we're starting to see this feed through and inflation. I agree. I mean, look, I thought I heard the Fed talk about concern around the labor market too, which would bring them back to, you know. Yeah, I mean, so I think we're all saying the same thing, that I don't think the Fed's doing anything right now. But I think that we've gotten to symmetry in the Fed outlook right now is a big deal.
- [07:22]
Tim Seymour
Plus you'd never cut into a supply issue. I'm sorry, you never hike into a supply issue. We Learned that in 2022. ECB did it. They wound up reversing tracks on that a decade and a half ago they did the same thing. You never raise rates in a supply issue because all it does is exacerbate the problem that you're trying to handle.
- [07:44]
Guy Adami
Except for you don't the supply issue hits you until it hits you. So I mean, I kind of last
- [07:48]
Melissa Lee
much longer than you think.
- [07:49]
Tim Seymour
Yeah, it creates the, it creates the buying power. It takes away from everything that you think you're going to have the issue with infl.
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Jared Holz
Inflation.
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Guy Adami
Fair enough. And I think we're going to talk about the housing market in a second too. I mean, and like the wealth effect from the stock market, that was a number, another number we got today and says it was at all time highs and it's a fourth quarter and backward looking. I think consumers, those especially ones that are spending because they're looking at their, their brokerage account are also going to start to feel some pain. But I do think you have a case and even back in 22, where we were in the world was our Fed let things run way too hot, way too long, suddenly turned into we've got to jam rates higher in 22
- [08:31]
Melissa Lee
that in the press conference yesterday.
- [08:33]
Guy Adami
Yeah, so. So, you know, I think it's different than 22, but I hear you. I mean there's, there's some reasons why it would be not great to be hiking here. I think things are pretty vulnerable.
- [08:44]
Melissa Lee
How often do you think the average person checks their statements? Probably on a quarterly basis. And what is what happens in a few days?
- [08:51]
Karen Feynman
Only quarterly, you think? Well, I guess I'm So, you know, 48 times a day is not the right answer.
- [08:57]
Tim Seymour
Right.
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Melissa Lee
We are a different sort of subset of the American people. But in general, in a couple of weeks they're going to be opening the brokerage statements and they're going to be realizing the market's actually down, especially in
- [09:07]
Guy Adami
Some high flying stuff.
- [09:08]
Karen Feynman
Right.
- [09:08]
Tim Seymour
I mean there are apps now. I think you're talking about this show maybe 20 years ago. People, I don't think people open statements anymore.
- [09:16]
Melissa Lee
This show. Right. I think an average person who maybe
- [09:19]
Karen Feynman
not has 401k, they don't really look
- [09:21]
Melissa Lee
at it, forget it kind of money.
- [09:23]
Karen Feynman
Yes.
- [09:23]
Melissa Lee
But you do look at it once a quarter and then it's going to be a rude awakening.
- [09:27]
Steve Grasso
It's going to be a rude awakening because they're going to look at an s and P500. Let's just do today's snapshot. Say it's only 4% or 4 and a half percent off an all time high. And I'm going to see a statement suggest otherwise and be like what? What do I own that I didn't realize I owned? And then they can start to sort of look underneath the hood and realize that some of these high flyers are not as big high flyers as they once were. I don't know if that changes behavior yet, but it's going to be somewhat eye opening. And going back to the rate conversation, we can talk about the Fed all they want. Maybe we talk about it too much. The market's raising rates for the Fed or for the market?
- [09:58]
Melissa Lee
As we speak, global markets are raising rates here in the United States even faster and that will bring up our rates. I mean there is certain market forces here that have nothing to do with the Fed and we could be seeing higher rates anyway no matter what the Fed does.
- [10:12]
Guy Adami
I think that's right. By the way, kind of nice to hear the bank of Japan finally recognizing there's some inflation out there. And I would just also get in terms of that wealth effect slowdown and add that on to what I've been saying about $65 oil, in hindsight, looks like it couldn't have gotten any better for people in terms of spending, especially the lower income consumer. I think these things all add up to a second quarter where the growth outlook has a lot of different pressure just because things were so extraordinarily good in the fourth quarter. I think that's something to think about.
- [10:42]
Melissa Lee
Well, our next guest thinks the market is mispricing. Fed rate cut odds. Evan Brown is the lead global multiasset portfolio manager at ubs. Evan, great to have you with us. Mispricing in terms of pricing out cuts this year or mispricing from another day because at one point this week there were cuts priced in and now there aren't any.
- [11:02]
Evan Brown
So yeah, we were pricing cuts for this year and now we're we're basically not and we disagree with that, with that move. I mean, I think what's important to keep in mind is the Fed has a dual mandate. We're talking about some of the other central banks that only focus on inflation, but the Fed has to focus on full employment. And let's not forget we had a pretty terrible employment report not long ago. This oil shock is going to end up hitting the consumer and so I don't think they can just look past this. I would agree with what Steve said earlier that, you know, this is a supply shock. As long as inflation expectations further out are anchored, then you know, the Fed should be looking towards easing later, later this year.
- [11:44]
Melissa Lee
So do you think that some of the knock on effects of the war is going to be that the job market is under further pressure? So even though both sides of the man, I mean they might see inflation on one hand, but the jobs market is actually going to be worse because of that spike and therefore they cut.
- [11:58]
Evan Brown
Yeah, it affects both. I mean look, the consumer is sensitive to gasoline prices and if not, you know, even if it's not a huge amount of everyone's spending, psychologically it matters. It affects consumer confidence. And so you could see some pullback in spending as a result of those higher gas prices.
- [12:17]
Steve Grasso
What is a rate cut do in an environment where duration yields have been going higher across, we just said across the planet. Does it help? Does it help?
- [12:26]
Evan Brown
I think it helps provide a little bit of an offset when yields are, yields are going up in Japan and Europe and the like. That is putting upward pressure on long term yields here in the US But I still think the front end matters. You get, you get rates down, you make, you know, things a little bit cheaper for corporates, a little, you know, borrowing further in on the curve and like and with some of the stress we're seeing in private credit that can help as well.
- [12:51]
Karen Feynman
So let's say you get well. Okay. Let's say Chair Powell leaves and things are pretty much the way they are. The way this leftover group voted wouldn't seem. I don't know how do you think, how do you think things will change that they would cut.
- [13:07]
Evan Brown
It's going to be interesting because Kevin Warsh is coming in with a committee. Yeah, we historically a hawk, more recently a dove. He's going to want to cut interest rates. He's going to have a committee that may, you know, he's going to have some doves and hawks there. But I think bottom line is he's going to have to be Persuasive, you know, he, it's not enough to have one person, they're just one vote. He's going to have to convince the whole committee to ease and you know, we'll see if he's able to do that. I think the data over the course of the year will allow him to. As core inflation comes down.
- [13:42]
Tim Seymour
Evan, you and I are on the same page, but just let's play devil's advocate. If they were to raise rates, I'll take the flip side of it. If they were to raise rates, it does nothing for the supply shock. And how quickly does it push us into recession?
- [13:56]
Evan Brown
Yeah, if they're, if they're raising rates into, you know, into this supply shock. That is very, very problematic for, for this market. You know, because you've got, like I said, I think you still have a growth environment that's just okay. And the labor market is vulnerable. I mean Powell said it yesterday where basically the break even is zero. That makes him feel somewhat uncomfortable. If you're hiking rates when average labor force growth each month is zero, then that can become problematic pretty quickly.
- [14:30]
Guy Adami
Evan, we've established on this show in the past that you're a Peter Frampton.
- [14:33]
Steve Grasso
Yes, he is.
- [14:35]
Guy Adami
So I have to ask you, do we feel, do you feel like we do as it relates to private credit? So the story, in fact I read a piece by the brokerage side of your firm this morning that the leverage loan market and the private credit markets may be under anticipating the issues that are there. So I'm just curious where that feeds into. Again, a view that I think you have that's pretty sanguine, at least in some of the near term risks.
- [15:00]
Evan Brown
Yeah, I think so. I mean with private credit, you know, I'm a macro guy, so I'm not looking at all these the story individually, but I think the key with private credit is that okay, there's price discovery here now there's, there's a tightening of financial conditions. There's, you know, we're looking at covenants and there's, so there's, there's a little bit more tightening there. But the good news is from an economy wide perspective, overall corporate debt, non financial corporate debt has been coming down as a percentage of GDP over the last few years. So there's been this transfer of risk from the banking system to non banks, but at least overall debt is coming down. So I think that price discovery process can happen without it being any kind of systemic issue.
- [15:45]
Melissa Lee
In terms of the reaction of this market to the conflict, there's Been a lot of just sort of deleveraging, moving down, exposure to some of the winning trades. Has the pendulum moved too far for some sectors? Where are you seeing the opportunity?
- [16:02]
Evan Brown
Yeah, I think you know some of the places that we like utilities, we do like, I mean had had a bit of a rough start to the year but since then you've got first of all it's a defensive market. So if I'm right that rates are coming down then that should help. But. But also you've got earnings that are improving, you've got valuations that are cheaper than some of the other defensives and we've got electricity demand going up because of fuel substitution and data centers. So we like utilities like tech which you know, hard to get tech for a bargain. Seen a lot of derating over the last several months and so like technology here.
- [16:41]
Melissa Lee
Evan, good to see you.
- [16:43]
Steve Grasso
Evan Brown showing us the way.
- [16:45]
Melissa Lee
Yeah, such a good sport, Evan. Such a good sport. We appreciate it. Big tech. How are valuations now?
- [16:54]
Karen Feynman
Lower. Yeah, no, I mean I still like the position. You know I like Google. It's one of my biggest positions. Metta in video I like hasn't done well. Dell actually has done surprising. Today was a pretty good day for Dell. I'm still long the space. It's definitely not been fun but that's okay. It's not always fun.
- [17:16]
Steve Grasso
I think we got to talk about gold here for a second because it had a one of these historic moves that we've had now over the last couple of months to the downside. Maybe it was predictable. I obviously did not predict it. Maybe the miners were trying to tell you something but it feels like there was some forced liquidation going on that I probably am not privy to that we'll find about in the aftermath. But I'll say again, I do not think the gold story is over by any stretch.
- [17:38]
Tim Seymour
Yeah, I think that's true. I think you wind up seeing markets when they sell off like this. The leverage bites both ways. There was a lot of people that were had the 2x3x times in gold and when you see it start to reverse, it cascades out of control pretty quickly. I don't think that the best days of gold are behind it but you have to admire the way this is sold off.
- [17:57]
Melissa Lee
We've got an earnings alert on FedEx. Shares are higher after topping expectations on the top and the bottom lines. The biggest earnings beat since September of 2020. The company also raising full year EPS guidance saying it will cut costs slightly more than expected and that the spin off of FedEx Freight will happen as planned in June. The conference call gets Underway in about 20 minutes time you're at after our session. Highs up 9%. Tim, there is on paper a lot to like about the quarter.
- [18:23]
Guy Adami
This was. I mean these are extraordinary numbers. I'm just going through them. But you know the dynamic around where the margins are and where they are improving essentially the cost base at a difficult time is incredible. So the operational effectiveness of this company independent of the macro is what the market is doing here. Let's also. I mean this is stock that certainly pulled back in the war conflict but this uptrend off of really the October 25th move is, is something that's north of 45% into this move. So long. Love this name, love the transport space even here at least those ones that I think we're relying on them to make their businesses better. I think UPS fits that bill too.
- [19:00]
Melissa Lee
The quarter ended prior to the Iran war.
- [19:04]
Steve Grasso
So now what markets didn't give them a pass. I think for, for. Because operationally things are better. I mean it's all about express with FedEx freight they'll figure out. But express margins were almost 8% and the street was looking for 6.8%. That's on FedEx. That's just them operating better. And yes higher energy costs are going to hurt but I think the market will give them a pass. And even though it's more expensive than it was a while ago, it's still not that expensive. So I still think there's room the upside.
- [19:31]
Karen Feynman
So yes, the quarter, it was a great quarter for sure and it is somewhat irrelevant because none of you know, all the excitement happened until recently. But they also didn't need to give guidance where they did. Right. They could have gotten a pass. They could have been a little tempered. This probably is tempered guidance. Why not? Right? It's. It's so that's impressive. And Roger the Bernan has done just a really spectacular job. So we'll see how. I think freight will be interesting when they spin it off. I don't own it, but very nice job.
- [20:02]
Melissa Lee
And the cost savings estimate has gone up as well. They raised that to more than a billion versus a billion. And an analyst that we spoke to in the last hour in closing bell overtime said that actually higher fuel costs could, could be helpful because they, they put in that surcharge and then money off. Right. They don't roll it off nearly as quickly as they put it on.
- [20:21]
Tim Seymour
Company was being run inefficiently. It was running as three separate entities now it's running as one and they're spinning off freight, obviously in June. This is one that you look at. They're growing, revenues are growing, UPS is shrinking. They're growing in their transitioning to a better company. Still a buy.
- [20:39]
Melissa Lee
Coming up, the latest Taxi team up, Uber and Rivian announcing an EV partnership when thousands of robo taxes could hit the streets around the world. That's ahead. But first, the action. And two tech giants, how Apple may be catching up in the air space and why Micron shares are lower despite blowout earnings. Don't go anywhere. Fast Money is back into.
- [21:03]
Guy Adami
This is Fast Money with Melissa Lee right here on cnbc.
- [21:09]
Jared Holz
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Tim Seymour
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Guy Adami
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- [22:37]
Jared Holz
Get started Today, men are struggling with
- [22:39]
Evan Brown
their mental health at some of the
- [22:41]
Jared Holz
highest rates we've ever seen.
- [22:42]
Evan Brown
But most aren't getting the support they need. And that needs to change. I'm Dr. Guy Winch, your host for season three of the Visibility Gap presented by Cigna Healthcare. This season, we're focusing on men's mental health, bringing together real stories and expert insight to explore the pressures men face day and why opening up can feel so difficult Join us for the new season wherever you stream your podcasts.
- [23:11]
Melissa Lee
Welcome back to Fast Money. Apple could be benefiting from the boom even as it lags competitors in developing its own AI system. According to the Wall Street Journal, the iPhone maker is tracking to bring in over $1 billion in revenue this year from App Store fees tied to the generative AI app caps 3/4 of those revenues coming from Chat GPT. Meanwhile, shares of Micron down almost 4% despite an impressive earnings beat after the bell yesterday. Revenue almost tripling from a year ago. Shares are still up 55% this year. Not bad. So what do you want to trade first, Karen Micron?
- [23:45]
Karen Feynman
I mean, you know, going into the print, I don't know that the numbers actually matter. It was great. It was better than great. It was enormous. Honest. Right. But going into the print, I mean, I don't know that there was, that there was a high enough bar they could jump over to, to have it go higher from here. Interestingly about the whole space though is the talk about longer term contracts and to the extent that happens, that should smooth out the boom bust cycle of P E multiples that normally a commodity like business like this would have. So that's sort of a, you know, that's a fundamental, interesting change. This valuation though is. It's not.
- [24:24]
Melissa Lee
Yeah, yeah.
- [24:25]
Tim Seymour
I think you've seen near term top in Micron, I think that move from 200 to 470 or wherever it topped out right around there. If you think about what they're building there, they're building on demand stated right now, there's demand shifts, there's demand slows and then some of these could just be overstated. So I think, I think you're going to see this year where this boomed. I think 2027 could possibly be a bust for it.
- [24:53]
Melissa Lee
2027 is when capacity additionally will come online, whether it be through Micron or some of its competitors in South Korea.
- [25:00]
Guy Adami
Yeah, I mean, so the question is how much does the market want to price that in now? Also, you know, yesterday on top of everything else, we saw I think 14 billion in free cash flow, which, which translates to about a 10% free cash flow yield, which is extraordinary. And we heard about CapEx, but as far as I can tell, this is still a very different free cash flow story than some of the hyperscalers who are on the other side of this. So I'm not chasing it here. I actually think it can pull back. I think we've priced in a lot of that into 27 and I do think supply will come on faster than people think. This is all people want to do. And by the way, in house, there's a lot of places too where I think people are working on memory.
- [25:40]
Melissa Lee
Yeah.
- [25:41]
Steve Grasso
If the market sniffs that out, whether it's 27, mid 27, they'll sniff it out long before that. And the other side of the cycle is as fast as these names go up, that's how fast they go down. And I guess the last 24 hours are glimpses of that. It was again, historic the quarter, but the price action is everything. So give it a couple days. But I wouldn't be a buy here either.
- [26:01]
Melissa Lee
There's a lot more fast money to come. Here's what's coming up next.
- [26:06]
Guy Adami
Sharing a robo taxi ride, how Uber and Rivian are teaming up and when you may see their driverless EVs hit the road. Plus, the Lily Lowdown, the pharma giant's next gen obesity drug posting record results, what it means for the stock and the competition in the weight loss drug race. You're watching Fast MONEY live from the NASDAQ market site in Times Square. We're back right after this.
- [26:37]
Jared Holz
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Tim Seymour
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Guy Adami
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- [27:08]
Evan Brown
Men are struggling with their mental health at some of the highest rates we've ever seen. But most aren't getting the support they need. And that needs to change. I'm Dr. Guy Winch, your host for season three of the Visibility Gap presented by Cigna Healthcare. This season we're focusing on men's mental health, bringing together real stories and expert insight to explore the pressures men face every day and why opening up can feel so difficult.
- [27:34]
Jared Holz
Join us for the new season wherever
- [27:36]
Evan Brown
you stream your podcasts.
- [27:38]
Melissa Lee
If you're a parent and want to help set up your child for success, then IXL is right for your family. As an effective and affordable online learning program, IXL covers math, language arts, science and social studies using interactive practice problems for Kids from Pre K to 12th grade listeners can get an exclusive 20% off IXL membership when they sign up today at ixl.com 20. Visit ixl.com 20 to get the most effective learning program out there at the best price. Welcome back to Fast Money. Uber announcing it will invest up to one and a quarter billion dollars in EV maker Rivian to bring as many as 50,000 robotaxis to the road by 2031. Revenue Rivian shares rose as much as 10% at its highs close the day up 3.8%. Uber shares were down today and have lost almost 8% so far this year. As part of this agreement, Uber will purchase up to 10,000 vehicles and then 40,000 more later on. These are options too, but in theory they could be owners of vehicles, which is very different.
- [28:47]
Guy Adami
Very different. And it's very interesting. It's very dangerous all at the same time if you're thinking about this, because again, asset heavy is not what this has been about. And this is a company that got to profitability faster than people thought after people thought it was going to take forever. All we do is follow headlines on where Uber is being Xed out because their platform will no longer be needed. They're going straight at it. It's interesting. I'm not sure what to do with the headline.
- [29:12]
Melissa Lee
How is this different from the hyperscaler? I mean, I know it's like, but I mean, they're going to asset heavy as well because they have to embrace AI and that's how you do it. That's what they did. Isn't this logical? Is it logical to embrace AI and how it's applied to this industry? Maybe you move to asset heavy as well. Should they be rewarded for that?
- [29:32]
Karen Feynman
Well, if the hyperscalers are a cautionary tale, then no, they shouldn't be. Right. If we look at what's happened to Meta as they become asset heavy and even go, you know, net debtors, not a lot relative to their cash flow. But I agree. That's the first thing that I thought of. Yeah. Yeah.
- [29:52]
Tim Seymour
I think there's a couple of takeaways from here. You're touching on one of them, but the other one is it's not a Tesla Robotaxi story all on its own. Rivian is going to share some of that. The problem I have with Rivian is I've been in and out of it. I'm not in it now, but they've raised 30 billion and they burned through 24 billion. It's a burn rate to cash burn rate. And every time they get an injection. They somehow let that be a fleeting moment. So I'd rather look at the Rivian side of it and say it's now become an execution risk. This is one that the market probably won't forgive them if they screw it
- [30:25]
Steve Grasso
up for three years. If you sold Rivian on these bounces, you've been rewarded and pulled the crack staff. And EC can show you a chart. I mean it has bounced at one point. I think late December is a $23 stock and look at where it is now. I would have thought again to play that game, a headline like this would have been worth a lot more than the day's gains that we saw today. It's not, which speaks to, I think, the underlying weakness of revision.
- [30:47]
Guy Adami
Uber's not expensive. It's also been inverse correlated on some level during this war conflict. Certainly there is some sense that they might be a gainer in a higher fuel environment. You know, I think Uber something that's interesting here. This news is fascinating. It doesn't mean that they have to go over their skis. It does mean they can cement their place in the middle of Robo.
- [31:10]
Melissa Lee
Coming up, a weight loss win for Eli Lilly. The latest trial results for its next gen obesity drug and the FDA news for Novo's WeGovy shot all the details out of the pharma sector when Fast Money returns.
- [31:23]
Guy Adami
Missed a moment of fast Catch us anytime on the go Follow the Fast Money podcast. We're back right after this.
- [31:34]
Melissa Lee
Welcome back to Fast Money. Stocks in the red again but bouncing late in the day to close off their lows. The Dow dropping more than 200 points. The s and P and Nasdaq both down more than a quarter of a percent. All three indices pacing for a fourth negative week in a row. WTI crude settling above $96 a barrel. Brent settling above 108 per barrel after hitting a high of 119. A double dose of weight loss drug headlines moving GLP1 makers today. Eli Lilly finishing just below the flat line after a phase from three studies showed that people with diabetes lost more weight on its triple agonist weight loss drug Retro tide than other GLP1s. And Novo Nordisk lower by a percent even after winning approval for a higher dose of WeGovy that allows people helps people lose almost as much weight as Lilly's. That bound shot. For more on competition in the obesity space, Mizuho health care specialist Jared Holz joins us here on set. Jared, great to have you with us.
- [32:24]
Jared Holz
Thank you.
- [32:25]
Melissa Lee
What's wrong with Novo? I mean, I'm Starting with Novo, it seems like it gets no credit for anything. Is this going to help?
- [32:32]
Jared Holz
Unbelievable. It should help. I mean, just, you know, get the company back on track in terms of the script volume and, you know, if you started on a lower dose, you can continue on this new one and hopefully it solidifies them a little bit. But it's been horrendous, worse than I ever thought. And they have over 400,000 patients now on the oral and the stock hasn't gone up once since this launch, it seems like, and they're already annualizing it nearly a billion dollars in revenue if all these patients stay on. And it's gotten zero credit. So I'm not. I don't really know what's going to drive it at this point. Maybe further business development or something else.
- [33:09]
Melissa Lee
How should we think about Retta True Tide? It's been out there in terms of its effectiveness. There was no, there's no plateauing in this recent readout, which is really interesting. How should we think about pricing for this? Should we expect premium pricing or is it still going to be under pressure? It seems like there's just a pricing sort of lid on. On all of these drugs now.
- [33:32]
Jared Holz
Yeah. The pricing dynamic finally started to shake Lilly recently. I mean, we've been talking about it for Novo for a long time and I think a lot of Lilly investors thought that, you know, maybe it would sustain a bit better for them. And I feel like we're finally at the point where if it's negative for one, it's got to be negative for both. The company hasn't really commented on the triple G, whether the pricing is going to be at a premium. I would expect it to be to some degree. But at the end of the day, like, these are consumer products. We've talked about it so many times. I just don't know if a large pocket of the population needs this sort of weight loss. It's unclear.
- [34:08]
Melissa Lee
Or if they're going to pay double to get 5% more or whatever. Percent more. I mean, like, that's sort of the trade off. If it's a consumer drug. That's what you look at.
- [34:17]
Jared Holz
Agree. That's what's gotten me sort of to back off of it, Lilly, over the near term because most of the people looking. Most of the people on these drugs, I think are looking to lose a little bit of weight fairly quickly, not a ton of weight over the long term. At least that's what it seems like. Obviously you have some people that are like morbidly obese, that are going to be on them chronically. But for the most part, I think 10 to 15% is what most people are looking for as a consumer, not as someone who's on this therapeutically. So yes, finally pricing has really started to shake people out of Lilly a little bit bit.
- [34:47]
Karen Feynman
I got to ask about structured therapeutics, if for no other reason than it's in my acronym, but I am very. I mean this stock has round tripped and. Yeah. What do you think of it here?
- [34:57]
Jared Holz
I just feel like the, the investor base is kind of determined that it's not necessarily better and it's obvious it's later. And so you've got two entrenched players that are big, you know, driving very profitable businesses. And unless you come along with something that is much better, either from a dosing standpoint or from an efficacy standpoint, where are you? So I think they're kind of like in no man's land. Then again, could someone pick them off tomorrow that wants to get in the game because they are fairly far along for a standalone obesity company. Totally. That's what makes me still engaged probably on the long side down here than not because M and A is rampant and someone could come tomorrow with a big premium. I just feel like it's, it's a possibility.
- [35:43]
Tim Seymour
Jared, when you look at this space, can Lilly, Lilly dictates what we focus on in large cap pharma. So what can they change? If it's not GLP1s, can they switch and pivot to another one of their drugs? Like what should we be focusing, focusing on in the back half of 2026 or 2027? Is it still going to be GLP1s or what is the next thing?
- [36:07]
Jared Holz
Yeah, it's a really good question because I think we're already starting to see that the evolution of the thesis may be slightly away from obesity for the first time in what, four years? I think there's some other stuff in their oncology portfolio which is probably understated as far as investors are talking about it. INI is a big piece of this business now trying to get into inflammation and some of these diseases which have really big markets. And I think Lilly as a big time now, they've done a lot of deals, they've been smaller in nature, but Lilly is a big time acquirer, I think probably starts to come into more focus as we go into the second half of the year. Because as a trillion dollar company, the only way to move the needle at that point is to do a big deal. We'll see. I Mean, the oral launch is coming. I'm sure we'll talk about that. That's going to be. That's going to be big. I think the Street's still pretty positive. But again, Novo Nordisk, over 400,000 patients on their oral drug and no one cares. So that's why. I just don't understand why there's so much fanfare around Lilly for what's basically the same product. But I think the question's a good one. I think it's going to be pipeline and then M and A in terms
- [37:10]
Steve Grasso
of Novo going back along the same lines of Karen, I don't know if you're familiar with my junk, but the N in the junk is not.
- [37:17]
Guy Adami
Who's not.
- [37:17]
Steve Grasso
Well, Jared apparently is not he now. He is now lucky. These were diabetes drugs before they stumbled onto this weight loss thing. And you look at the round trip, I mean, this is still a diabetes drug at a certain level that they're not being rewarded for, seemingly at all. Is it a messaging problem at this point?
- [37:35]
Jared Holz
Yeah, messaging has been a big piece of it. You know, they basically flipped their entire board, new management team. The execution over the past year probably couldn't have been worse. You could argue. That being said, I did write a couple weeks ago that in some weird way they would be better off never having gone into obesity with the stock being here. I mean, these are multi year lows. They still have 40% share, give or take, of the biggest market in all of therapeutics and the street has totally abandoned it. Yet you got Eli Lilly sitting here as of like a couple weeks ago at a trillion dollar market cap. The argument could be made. Of course, you can't go back in time and they are driving a ton of revenue. But it's mind blowing that the stock has done so badly given everything. Yeah, I mean, if you kind of rewind and go back, this was a compounder on a fairly boring business. They get into the sexy one, the sexiest business, impossible.
- [38:35]
Guy Adami
So they referred something along the line really quickly. That speaks to positioning, though. So tell me where your clients are on this, because it tells. I mean, nobody's in Novo and I feel like Lilly's a little overweight. I saw your notes. You think Lilly actually has stopped going higher? You're not making maybe a short call on this one, but I'll make the call on positioning. It's extreme.
- [38:56]
Jared Holz
It's the most extreme I think I've ever seen for pretty much the same product. I mean, the nuances we can debate for hours and you know what patient is better off on which drug and the percentages. But by and large, you've got WeGovy at 15 or so. You've got Tirzepatide at high teens. For most people, I think they're basically the same. We've been talking about them like they're polar opposites. These are essentially the same things for most people. Yet One company is worth 5x the other. I don't think I've ever seen anything like that. You know, we talk about Stryker and Zimmer and Merck versus Bristol is sort of like comps in health care, but we've never seen valuations get blown out like this that I can recall for a market that's in, that's so clear as day. So it's fascinating.
- [39:44]
Melissa Lee
Jared, good to see you. Thank you. Thanks a lot of Mizuho. What do you think the trade is here?
- [39:49]
Steve Grasso
Well, incorrectly, I thought it's been novo for a while and there was a point in time earlier this year where it looked like we actually, actually caught it cold on the bounce off those, the lows that we saw in the peak in the trough of 2020 that didn't wind up being the case. I don't think that. Well, doesn't matter what I think. It feels as though to Jared's point, the market is not rewarding novo at all for their rest of their businesses.
- [40:11]
Melissa Lee
Well, tonight, a deeply personal story from one of our own. In a special one hour documentary, Becky Quick opens up about her daughter's rare disease and connects with others determined to rewrite the rules of medicine. Here's a look at one man taking on ultra rare conditions one patient at a time, including a young girl named Susanna.
- [40:32]
Steve Grasso
Susanna has a mutation in her KIF1,
- [40:35]
Evan Brown
a gene that slowly kills the nerves in her brain and kills the nerves
- [40:40]
Melissa Lee
in her whole body.
- [40:41]
Karen Feynman
Her condition is considered nanorre, affecting only a few dozen patients worldwide. When doctors told Luke and Sally Rosen that they had five years, they quickly started a foundation to look for others like her and to identify experts who could help.
- [40:58]
Evan Brown
I recall banging down Stan Crook's door and just calling and calling and calling until he got back to me. People arrive at our door.
- [41:08]
Melissa Lee
Hopeless. Hopelessness is a terrible state for a young.
- [41:14]
Karen Feynman
It was Dr. Stanley Crook who opened the door to the lifeline the Rosens were searching for. Crook founded nlorem, a nonprofit that uses antisense aglionucleotides or aso, therapies to target cells building faulty proteins. Treatment is free for Life.
- [41:33]
Melissa Lee
We have five applications in the first 10 minutes. After we open our doors.
- [41:38]
Karen Feynman
So I knew that it was a
- [41:40]
Melissa Lee
much larger problem than we than I recognized. Unlike most biotech companies that are chasing
- [41:47]
Karen Feynman
scale and Lorem designs ultra personalized therapies
- [41:50]
Melissa Lee
for populations with 30 people or less
- [41:53]
Karen Feynman
for these families, the foundation is their only hope.
- [41:58]
Melissa Lee
Do not miss CNBC cures defying rare disease that is tonight right here on CNBC 7:00pm Eastern Time. We're back in to welcome back to Fast Money. Alibaba shares slumping more than 7% following disappointing earnings before the bell. The Chinese e commerce giant missing revenue estimates reporting a whopping 66% year over year drop in net income. Cloud revenues grew 36% from a year ago. Shares of Alibaba down nearly 15% this year. Is this an acronym this year or is this all last year?
- [42:31]
Karen Feynman
Last year from this last year.
- [42:34]
Guy Adami
Yeah I think I had a couple of years ago and seems to be the story. Although you know the folks at home don't know this but we were just talking. You can actually swap in a new letter into your acronym at the end of the first quarter. I almost feel like in Timbo I want to slide out Biogen which is rallied and drop in an Alibaba that's underperformed. This is just getting you into some of the tactics and how we play the Timbo again. I mean how amazing. So, so what's interesting about Alibaba is I don't think these numbers were bad. I think they were in line. I think there's some really exciting parts of their business including kind of the tokenomics that's been some of the headlines over the last. But Alipay, Ali Cloud, Ali Cloud especially is part of the story that has this company in a great spot in the AI world at a time when I don't think they've overspent. So sentiment is awful. International stocks have been selling off. I think this is a long term up.
- [43:26]
Karen Feynman
Yeah, I agree. I mean there was a miss sort of down the whole line. Lots of different businesses delivery and you know they're. But they're being aggressive right now. They know, they know that's going to be a difficult business. But I agree. I also think the, the macro just is terrible and they're just sort of going down with that as well some deserved here. But I think the big picture. I like it. I still like it.
- [43:49]
Steve Grasso
A lot of cash cloud business good. The spend hurt margins but the E Commerce portion was. It is in a word another word I use but I'll save it for a different show. But it was A disaster. But I'm with these guys. I mean it's. It's just the back of the envelope mass suggests the stock should be a lot higher than it is.
- [44:04]
Melissa Lee
You're not going to swap Alibaba and I don't play.
- [44:06]
Steve Grasso
I'm not swapping it. You dance with the girl you brought
- [44:09]
Guy Adami
to the we see guys acronym. Is it possible to see that? I mean I don't possibly get junk up there.
- [44:16]
Steve Grasso
Cheshire cattle.
- [44:17]
Guy Adami
I guess not.
- [44:18]
Melissa Lee
Coming up Sandy wants us to get out. Absolutely. As new home sales plan to start the year the impact on the builders what mortgage rates mean for home buyers More money and more fast money into. Welcome back to fast money. Homebuilders taking a hit again today with the ETF hitting its lowest level since June. The move coming after new home sales dropped to their slowest pace since January 2022. Sales fell more than 11% from a year ago while the median price was down 7% compared to December sales were down more than 17% where mortgage rates now 30 years at about 6.3%. So now what?
- [44:59]
Tim Seymour
Yeah the mortgage rates are going the wrong way. You need mortgage rates in the fives to actually be competitive. You know it when you have a rising rate environment it helps everyone who already has assets. It hurts everyone who doesn't have assets, who doesn't have a home, who doesn't have stocks, who don't have who don't have a 401k that's bulging so you need it's going to hurt all these names rates. I do think that when you when you take the lens back and we look at June and maybe summertime I think these rates will come down same as with the price of oil and you'll start to see life being bred in and Guy brought it up earlier on the show. Stocks react about six months ahead of what the news is coming down the pike. So I think these are probably good buying opportunities.
- [45:41]
Steve Grasso
See first of all bulging for one case sounds painful. I'm sure there's salve for that. That's I'm not familiar with but I'll take the other side. I think home I think in terms of like the pulte stalls dhi it still feels like there's some pain to the downside. People are expecting rates to go lower but the labor markets suggest that things are softening. I'd avoid the homebuilders.
- [46:01]
Melissa Lee
You're talking HD today.
- [46:02]
Guy Adami
I think HD is interesting three twenties a three year level on the stock where it seems to bounce. It was. It was resistance back three years ago and I just think that you've had an opportunity to see some of the margins hit, some of the tariff dynamics hit some of this to settle through. It's been very cyclical. This is arranged to buy lows incidentally, might look a little bit marching. They also just announced a home services business which basically means you could call guy and get some stuff done at your house that you don't know how to do yourself. Because my guess is you don't know how to do most things that around your house, you know, I mean.
- [46:32]
Steve Grasso
So
- [46:35]
Melissa Lee
next final trades, Final trade time
- [46:43]
Guy Adami
Timbo at 375 people wanted to own Home Depot. I think this is an interesting level for a long term investor.
- [46:49]
Karen Feynman
Karen Just so you know, Tim and Melissa both know how to caulk. Anyway, my final trade is Alibaba.
- [46:56]
Melissa Lee
That's my superpower.
- [46:57]
Tim Seymour
Stephen First Solar Guy, Newmont Mining Melms thanks for watching.
- [47:04]
Melissa Lee
Mad Money with Jim Cramer starts right now. All opinions expressed by the Fast Money participants are solely their opinions and do not reflect the opinions of CNBC or its parent company or affiliates, and may have been previously disseminated by them on television, radio, Internet or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Fast Money participants consider reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Fast Money disclaimer, please visit cnbc.com fastmoneydisclaimer Day or night, VRBoCare is here 24, 7 to help make every part of your stay seamless. If anything comes up or you simply need a little guidance, support is ready whenever you reach out. From the moment you book to the moment you head home. We're here to help things run smoothly because a great trip starts with the right support. And hey, a good playlist doesn't hurt either.