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Halftime Report
Best Q4 Strategies 10/01/25
00:46:55
Scott Wapner and the Investment Committee debate the best strategies for Q4 as we head into the final stretch of the year. Plus, Jim Cramer joins the desk to discuss his new book, the market and the best way to protect and grow your money. And later we are joined by John Mullen, president and CEO of Parsons Capital Management which ranked No. 1 on CNBC’s list of the top 100 financial advisors in the U.S. for 2025. Investment Committee Disclosures
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- [00:00]
Narrator/Advertiser
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- [01:02]
Scott Wapner
I'm Scott Wapner and you're listening to CNBC's Halftime Report, the podcast the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in. Carl, thank you very much. Welcome to the Halftime Report. I'm Scott Wobner. Front and center this hour, the year's final stretch, the fourth quarter getting underway. We will discuss and debate the best strategies for your money with the investment committee. Joining me for the hour today, Joe Terranova, Liz Thomas and Steve Weiss. We've had a nice turn in the markets. We are green. We do have the first day of the shutdown. ADP's worst print since March of 23. Lisa Cook is staying on the Fed for now. Bitcoin and gold keep rallying. And here's where we begin. Q4. We got a 13.5% gain in the S&P 500 year to date. Nasdaq up 17, the Dow up 9. The Russell up 9 as well. Joe Terranova. Actually, you know what? Not Joe Terranova, Liz Thomas. I just felt like switching it up on the fly. Sorry. You're about ready to go.
- [02:02]
Joe Terranova
I feel like I should apologize.
- [02:04]
Scott Wapner
You got demoted.
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Joe Terranova
All right, that lead off.
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Scott Wapner
Liz, what should investor mindset be entering this final stretch?
- [02:12]
Liz Thomas
Final stretch of the year, you mean?
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Scott Wapner
Yeah.
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Liz Thomas
So starting the fourth quarter, there's this seasonality. Everybody gets excited. We're going to have a rally into year end. I do think that that is a possibility. I don't know that it's going to start right now and continue unabated. I think that we're at a point after a lot of these all time highs that the market is due for a pause and there should be a time of maybe some of the shakeout of these valuations. Many people have been call for that. Sometimes just the fact of calling for it causes it. But all these warnings that we've gotten about rebalancing at quarter end causing this big move out of equities and into bonds and so on and so forth just never really comes to fruition. So I don't know why we keep worrying about that. The government shutdown on the other hand is something that I think markets aren't necessarily going to welcome. But if you look over history, they've actually done pretty well through a lot of the shutdowns. There have been a few here and there that have been bumpy, but on average returning somewhere between 2 and 3.5% percent in the three months following a shutdown. So even this isn't necessarily something to be that concerned about.
- [03:16]
Scott Wapner
All right, Joe, Earnings season is almost upon us. They're expected to be good again. The Fed is expected to keep cutting interest rates. So I hear everything that Liz said and it all makes perfect sense about, you know, some of the risk versus the reward. But what I just mentioned, earnings good and Fed rate cuts and just maybe people chasing maybe some cash on the sideline coming into the market. It's hard to get in the way of this, this rally. Right. I mean of this bull market.
- [03:50]
Joe Terranova
Yeah, I think the fourth quarter will be strong for all the reasons that you cite. I think strategically that's the big question for an investor. And I think when you look at your portfolio, don't be surprised to see a little bit of a turn, a little bit of a rotation here. We're seeing the signs, the early signs of it here. The first day of the fourth quarter. Health care coming back into play, quality up as a factor. Momentum is lagging today. And keep in mind, momentum just does not mean high beta names. Momentum means the fin5. I've been talking about them ad nauseum well over the last several days. They're not performing well, financials not performing well. So I think that little turn within the market is going to unfold here in the fourth quarter. It's probably even going to touch the small cap equity size class similar to the way that it did last year.
- [04:39]
Scott Wapner
Weiss, what do you make of bank of America's flow show note today? There were record sales of large cap stocks over the last two weeks. Sales of single stocks in the last two weeks were the third largest of any two week period since 08. It was driven by large caps. Clients sold 9 of 11 sectors led by financials. Right. Joe points out a little bit of weakness of late. You had the sixth straight week of outflows, the fourth largest weekly outflow since 08. In financials, comm services saw the second week of outflows, the sixth largest on record. And sales of energy stocks were the largest since early 22. What do you make of that?
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Steve Weiss
Well look, I mean I think you'd see it in, in the charts of some of the companies where they, they had an amazing run, they peaked and now people say, you know what, we missed a peak before on these names so maybe we're not going to see a third peak. So let's take some profits. I think that that's pretty normal. I don't really know what the correlation is between the flow show numbers and actual market performance. My suspicion is it's actually correlations higher short term but I'm going to look at long term. So I still think that, you know, fortress balance sheets, impregnable business models, they're the ones I still want to own. Permanent compounders. What I am concerned about and be getting more concerned about it is that everybody seems to be on the same side of the boat. And when they're on the same side of the boat, that boat wobbles. Sometimes it goes over I guess because.
- [06:09]
Scott Wapner
Yesterday I said the same thing on closing bell. I had, you know, we had gotten like 40 minutes through the program and through the three panelists at the top and one towards the bottom of the program. Everybody, no matter what their discipline was, was like markets kind of hard to get in front of here. It's set up pretty well into the end of the year. You had Goldman raising their forecast for global equities the other day. Right, but sometimes the crowd's right.
- [06:39]
Steve Weiss
No, I agree and that's why I'm.
- [06:41]
Scott Wapner
Staying long, you see, to get a bigger boat.
- [06:43]
Steve Weiss
Yeah, exactly. And a more stable boat, maybe a try haul because to balance it. But that, that is my concern. My other concern is that as we're going into the quarterly earnings which is hit in earnest in about two weeks, we're going to really hear for the first time the impact of tariffs and somebody's got to absorb them. We're hearing news that comes out saying hey, you know, Nike big on tariffs, you know, huge hits of them. So who's going to pay that? So and if consumers pay it. Well the other point is, is that.
- [07:18]
Scott Wapner
Nike's up, by the way, almost 6%. They can have whatever impact they want.
- [07:22]
Steve Weiss
It's from such a low base, like.
- [07:24]
Scott Wapner
The stock stocks, sure, but it's still up 6%. And many companies, we've long stated that one of the greatest things about this country and these equity markets is we have the best companies in the world and we have the best CEOs in the world. And they figure it out. They figure out how to run their businesses through thick and thin. Maybe they pass on a little here, maybe they absorb a little there. Maybe they tell their distributor, you know what, you're going to have to eat some. They tell their importer, you're going to have to eat a little bit too. And then when you add the pie up, it's not so disruptive to how the whole thing looks and tastes.
- [07:58]
Steve Weiss
And I agree with that completely. But I think it depends upon what your company's end market is. So there are two levels of consumers here and the gaps widening. And that's not a social comment or anything, it's just factual. So we've got a number where we hear that they're living right now. They've always lived paycheck to PayCheck. That's about 60% of consumers. But now it's getting tougher for them because of inflation, because of increases in grocery costs.
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Scott Wapner
I got something for you coming up on moderate. Go ahead.
- [08:26]
Steve Weiss
So that is the issue. So if you're playing to them, you know, I think you could be in for some rough sledding.
- [08:33]
Scott Wapner
Okay. So on that note, maybe all of you have seen these consumer finance names. They're in focus because many of them have not performed well, sort of on the lines of what Weiss is talking about. And he's not the only one talking about it either. The question is, is it the start of something to be more concerned about? Joe Capital One's down 5% this week. Affirm is down 15% in a month. Klarn is down 9% this week. Upstart's down 18% in a month. The FT has an article today about subprime auto delinquencies, up 9.3% in August. CarMax talked about elevated loan losses in some areas of their loans. That Stock is down 27% in a month. BTIG looks at all this today, especially the consumer finance picture, and they ask smoke or fire, Smoke or fire? And what it says potentially about where the consumer is and whether the market is simply too complacent because it's drunk on the idea of good earnings. Fed cuts And AI overload.
- [09:38]
Joe Terranova
So you mentioned before, maybe we need a bigger boat. Maybe we're ultimately going to just have another boat. And the challenge when I say maybe we're going to have another boat is the boat that we're going to leave is the boat that you're talking about. The names that are levered to that strong economy in an environment where the economy is clearly decelerating in the new boat, you could put your Mag 7 names, you could put some of the health care names, some of the quality names, but the consumer oriented finance names are reliant on the strength of the economy. And the economy is clearly right now deteriorating. Keep in mind the government shutdown. While everyone would like to say the market's going to overlook it, okay, a protracted government shutdown probably means the unemployment rate with 600,000 government workers approaches 4.7%. That's a problem. Look at the airlines and the way the airlines are trading the last several days. They're trading understanding that leisure travel is going to be more challenged in an environment where the economy is contracting.
- [10:42]
Scott Wapner
Look at restaurants over, you know, not necessarily a weak period, but restaurant stocks haven't traded that well. There's a clear signal service. Restaurants haven't traded all that well. My question is, is, is the market ignoring some alarm bells that are going off in the distance? They're not close enough yet for you to get too concerned about it. You had some bankruptcies. You know, the credit markets are sort of awake and people in credit are looking at that and saying, okay, I'm going to keep my eye on that. It's not, you know, DEFCON 3, 2 or 1 yet, but we need to watch it.
- [11:21]
Joe Terranova
I think the market is, is clearly understanding exactly what you're saying. Pull up a chart of Royal Caribbean as I speak. You could see that stock is beginning to have a modest correction. I mentioned the airlines. You seeing the strong correction there as well. So no, the overall market, but, but the overall market is, is going to be somewhat impervious to that because you have a company that has a $4.5 trillion market cap in Nvidia that's not reliant on the economy. You have other Mag7 names like Apple, which appears to me like it wants to break out above last December's high. You have strength in the entirety of those MAG seven names. So, no, the market can be important, impervious to an environment. It goes back to the expression, sometimes the economy is not the stock market. Sometimes the stock market.
- [12:05]
Scott Wapner
I got another thing for you, Liz, which Deutsche bank talks about today. For better or worse, Nvidia continues to be a major market mover. I don't think anybody would be surprised by that comment. But how about this? Nvidia's market cap, right above four and a half trillion yesterday, first company to ever hit that level. The market cap is now larger than every country's entire listed stock exchange, apart from the U.S. china, Japan and India. Larger than every company, every country's entire exchange, except U.S. china, Japan and India. Now, if, if you're on the right side of this market, if you're in those stocks, Liz, you're perfectly happy and you're feeling pretty good under the surface. Things don't look that good under the.
- [12:52]
Liz Thomas
Surface of tech companies.
- [12:53]
Scott Wapner
No, no. Of other. Of other so. Of other names.
- [12:55]
Liz Thomas
So let's make a distinction between sentiment from investors, which is positive right now, and investors in Nvidia in the MAG7 and a lot of these names that have led the market higher sentiment will stay positive. And then there's sentiment of the consumers. And if you look at even just consumer sentiment measures, they have been under pressure this year. And you've got consumers on different ends of the specific spectrum. We're talking about consumer finance companies. You also have to distinguish between the quality of those borrowers. If we're worried about credit quality of those borrowers, there is a wide spectrum of borrowers in a lot of those companies and it's going to matter. Their spending is going to matter, their delinquencies are going to matter based on the quality that they're coming in with. With a labor market that remains relatively strong, save for perhaps some of the, the effects of a government shutdown with a labor market that remains relatively strong, I think the consumer is in fine shape. There are always bankruptcies happening under the surface. There are always delinquencies that are sort of moving around under the surface. There is nothing out there yet that is screaming alarm bells and to the point about the market not necessarily sniffing it out yet. You have to watch credit spreads. Credit spreads have not budged. In fact, they've gotten tighter over this entire period. Nothing in the market yet is telling us there's a problem here. And the last point I'll make is maybe some of the consumer finance companies are under pressure, but then how do you square that with the fact that private equity companies are under pressure as well? That's a completely different buyer and that would be maybe a wealthier buyer. So they're both under pressure. I think that we're just at a point in the market where people are looking for opportunities that aren't the things that have led us to this point. By the way, the rotation is, is underway and I think we'll continue.
- [14:36]
Scott Wapner
We got Mark Lasri on closing bell today, so we're going to, we're going to talk to him about what's happening in credit, whether there's reason to be concerned about some of the, the recent stories that have made people a little nervous in certain areas of the market. We can talk about lending standards and things that happen when, you know, money was accessible. Weiss part of the point of bringing up the Deutsche bank note about Nvidia is that you better hope that Nvidia and these other names keep performing the way that investors think they will or you have a problem as you look ahead into Q4, that's the ball game. If you have concerns about the economy, are you really going to get a big broadening area outside of large cap financials, very large cap industrials and then these, these names?
- [15:32]
Steve Weiss
I think you need to see the, the names hold their pole position in order. They don't have to go up. But you can see fundamental flaws in terms of their operating model, meaning disappointment and significant disappointment with them and just can't be one of them. It's got to be multiple. If you recall when Alphabet disappointed about a year ago, it was also then the others continued to march upward. But the, but they're still good. You know, I still think they're going to do quite well because of their spending on AI and because of revenue. Meta comes out with a new meaningful product, seems like every week. So they're leading the charge here. Alphabet has a great recovery. You can see now they're innovating. They always innovated. Now they're really advertising.
- [16:19]
Scott Wapner
They just saw the biggest quarterly gain in 20, 20 years. Did Alphabet up 38% in the quarter.
- [16:27]
Steve Weiss
Now after lagging significant, had a significant.
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Scott Wapner
Clearing event, no doubt. But the, the day of the Eddy Q sell off, which we sort of put as the line in the sand, right? He's in the courtroom. He says, first time ever we've seen the share of search decline on, on an iOS. You're like, oh man, this is a problem. The stock performance from there, I think it surprised a lot of people. And that was probably a tremendous overreaction in the market that day. Maybe we overreacted about it that day. Farmer Jim sat over there and said, you guys are ridiculous. He stayed with it. The stock's up 38% in the quarter.
- [17:11]
Steve Weiss
I'm not entirely Surprised it's moving moved because I own it. I'm in time. I'm surprised it's moved this much but go ahead John.
- [17:18]
Joe Terranova
No, I think you know and I was one that overreacted on that day pushing up against Jim. I was clearly wrong. I believe the stock on that day fell to about147,148 early May. So it's been a dramatic rise but I do think you had and leading up earnings were okay earnings reported and the price action was somewhere around 190 but the stock really took all the off after you got that regulatory clearing moment and I think from there yeah, that's seen a massive repositioning where if you looked at the Mag 7 Alphabet was the one name where I think it was under owned along with Apple. I think you're seeing a dramatic rebuilding of position here in the month of September.
- [17:59]
Steve Weiss
Well it was the only battleground stock in the mag 7 really aside from Apple which is always a, you know battle grand prix as valuation I thought.
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Scott Wapner
Tony Pescarello of Goldman as usual makes an interesting observation in his recent commentary. Quote, he's talking about the NASDAQ price action on the long side suggested a lot is in the price Talking about the nasdaq, the biggest stocks in the market raising plenty of debate on the viability of a fourth quarter seasonal rally that will be hotly debated like what is already in the market susses out what's happening, right? The outlooks are so good that stocks have already priced you would think a lot of that in so he raises that issue then how about this? The questions over a bubble in AI are going to persist no matter what. Since ChatGPT launch at the end of 2022 the MAG7 has soared from 7.1 trillion to 18.6 trillion in value. The seven names now represent 33% of the S&P. Right? From 7 trillion to 18 trillion in value. It's crazy for good reason. You could see why. But should that raise any sort of flag to people in any way?
- [19:21]
Steve Weiss
There are lots of warts in the market that aren't flagged yet. For example Nvidia essentially buying their business, right. Investing 100 billion or whatever they're going to do 100 billion into into open.
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Scott Wapner
Air like the circular nature of exactly right.
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Steve Weiss
People have raised that issue to doing the same thing. So you're buying business in a market that weren't so inflated with optimism. Those would start to resonate a little more as would to your point, the two bankruptcies in private credit now I have no doubt know Mark Lasari well as you do. He's a great underwriter, he's a great risk manager so I'm not worried about him. But there are so many tertiary and secondary players that have come along just building books of business for the Feees. So the two banks use. One was not small, you know, an auto parts manufacturer, $10 billion of private lending money they have there. The other one was a. Was a subprime lender in autos. So I. So what they've done is they filled this gap that was vacated by the banks under duress. Right. By the government. And you can't believe that, that they have the same risk management that the banks had and look trouble they got into. So those are things. Right now we're still in what I think is really a euphoric stage as it applies to next seven. We're seeing the others catch. Well look at, I worry about it.
- [20:41]
Scott Wapner
Every day but I haven't look at the power names. GE Vernova for example is up 82% year to date. It has a 60 plus 60 times PE and it got downgraded today at RBC they say yeah, strong demand, we totally get it. It's already reflected in that valuation so what more do you want? So they downgrade it today to sector perform Vertiv record high today. That's Joe's 35 times it trades. It's up 33% year to date. Oklo nuclear power player up 421% year to date. They say they're hoping at least. There was a report today they're hoping to launch at least one of their three planned US nuclear reactors by mid 26. Constellations up almost 50% year to date. How about this Constellation?
- [21:31]
Joe Terranova
Constellation up again today. Vistra up again today. I think that this is a well known tailwind for the market. You have several thematic tailwinds that investors have aggregated around, congregated around for the course of 2025 and that's unknown. And the fundamentals there really are not going to change very much. I always say this. Portfolios are like fingerprints, they're unique to the individual. So you have to say to yourself okay, if I need to reshape my risk and I hate when someone comes on and say oh we eliminate risk score, we mitigate risk. That's nonsense. No one can do that. If you need to reshape risk, you ask yourself the question where is the liquidity in the market if the market needs liquidity? And that exactly would be mag7 that would be the names that you're citing. So if you have an understanding of that, then you therefore know how to size your position accordingly and say to yourself, if I look forward into 2026 despite really strong fundamentals, guess what? If the market market needs liquidity, it's coming from the Mag 7, it's coming from your vistas, it's coming from your constellation Energy. Just be aware of that. Set your expectation. That doesn't mean get out.
- [22:38]
Steve Weiss
That's not the only place to come from. It's going to come broadly because as you correctly are pointing out, the trade is more than just the max seven. It's as you're pointing out is the energy player what you sell, what you have when you panic.
- [22:53]
Scott Wapner
What do energy related names and like utilities, do they typically trade at such a premium to a market?
- [23:02]
Steve Weiss
Never ever?
- [23:03]
Joe Terranova
No, but what's, I'm sorry, that's my point.
- [23:05]
Scott Wapner
It's a, it's a rhetorical question in some respects. When you see that, you know some of these names that avertive at 35 times, Vistra at 25, Constellation at 32 and Vernova at 61 times. That's why we are suggesting, well, these are being treated as the new growth stocks in the market there be there.
- [23:27]
Joe Terranova
There'S a premium that's being paid and a lot of what's going on right now in portfolios. If you look at list, energy is what, somewhere around 3%s and P utilities somewhere around 3%. So what's happening right now is you have managers who are saying, okay, in a portfolio, Scott, I don't need oil because the Trump administration says saying we're going to, we're going to keep our foot on the price of oil, right? I'm going to replace my E and P exposure with utility exposure because of the growth that is evidenced right there. And that's a lot of what's happening right now in the financial services industry. You see the redeploying of capital.
- [24:03]
Scott Wapner
All right, we're going to take a break because our halftime headliner is coming up next. The final stages of makeup are being applied as we speak. He is standing right off our set and he is Jim Cramer. He has a new book, it's called how to Make Money in Any Market. He joins us right here at post nine. Next. Our state has changed a lot in the last 140 years.
- [24:33]
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- [24:59]
AT&T Business Announcer
And now a next level moment from AT&T business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for International Sleep day. You've got AT and T5G so you're fully confident, but the vendor isn't responding and International Sleep Day is tomorrow. Luckily, AT&T 5G lets you deal with any issues with ease so the pillows will get delivered and everyone can sleep soundly, especially you. ATT 5G requires a compatible plan and device coverage not available everywhere. Learn more@att.com 5G Network.
- [25:29]
Scott Wapner
Taylor Swift just.
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Silvana Hanow
Came off her record breaking era store.
- [25:33]
Joe Terranova
What can she do to top it?
- [25:34]
John Mullen
The pop superstar announcing a brand new album.
- [25:37]
Silvana Hanow
Literally everything she touches.
- [25:39]
Jim Cramer
People know about the Swift effect.
- [25:41]
AT&T Business Announcer
Cnbc premieres Saturday, October 4, 10 Eastern.
- [25:45]
Scott Wapner
Breaking news on Capitol Hill with Emily Wilkins. Hey, what do we have a. SCOTT.
- [25:50]
Emily Wilkins
Well, it looks like the government shutdown is going to be going on for a little while longer. The Senate just tried again and failed again to pass a seven week stopgap that would allow the government to remain funded or get back to being funded rather. And like again, like last night, we saw three Senate Democrats join with Republicans in voting for it. But of course, the magic number is eight Senate Democrats. They don't have that at this point. And it seems like a number of Democrats, they're still holding out there, still want to see some sort of leverage or some sort of movement on getting these Affordable Care act tax credits reapproved. So they know that a number of their constituents are not going to see higher health care costs next year. But of course, now that we are in a shutdown, that pain of that shutdown is about to become very apparent, both to a number of furloughed federal employees, as well as contractors who deal with the government, and then a number of other things, including the job numbers on Friday. At this point, the Senate does not seem likely to take another vote on the CR today. Of course, anything can change and then they are off tomorrow, which means the next opportunity they would have to stop a government shutdown would be on Friday. And we'll continue to give you any updates as we give them.
- [26:59]
Scott Wapner
SCOTT okay, Emily, thank you. That's Emily Wilkins on Capitol Hill. As you see, she said the magic number is eight. Apropos, because this is Jim Cramer's eighth book. It is called how to Make Money in Any Market, and Jim is here with us now. Congrats on this new work.
- [27:16]
Jim Cramer
Thank you. Thank you for having me. The show has been unbelievable as always, and I love the discussion at the top. You just got to go with the flow. And I feel that's true.
- [27:24]
Scott Wapner
You feel pretty good. We'll get to the book, obviously, in two seconds. You feel pretty good about stocks heading into Q4.
- [27:28]
Jim Cramer
Yeah, I still do. I'm looking at certain stocks that just can't quit. I mean, the old line names like a Western digital keeps. It keeps going. Names that we know for ages, Forever. Forever. And I just find that what's happened is people have a groove and they say, listen, I can keep paying up for these and up for these notes. And then out of nowhere, health care explodes. And Merck, which has just been a terrible form because of five just using this as an analog is. Each day it seems like there's something that comes alive with pleasure.
- [27:56]
Scott Wapner
Okay, so with pleasure is how you've talked about the markets and stocks for all of these years. But you, you do pride yourself on being a teacher and trying to, you know, export your knowledge to help people become better investors. You call this a how to book? In what sense?
- [28:11]
Jim Cramer
Well, look, I think that what I'm trying to do is democratize things. I want to people. People to be at home, to be every bit as good as. As you guys in terms of facility. All right, you're, you're, you're pure stock pickers. But I want people to understand what you say because it's incredibly valuable. And I want, for instance, I spend a huge amount of time on the PE multiple. What's the multiple? Because I never hear anybody talk about it. I deal with what I talk about, what my mom and my late mom, my late dad, the mistakes that they made. Like, my mom felt that Pepsi, if it was at 100, was twice as expensive as Coca Cola 50. And that bothered her. We can't do that. We have to help people. My father always wanted to buy the greatest tip in the world, and he destroyed. Destroyed us on a company called National Video, which was a game, a team, a company that made vacuum tubes right at the height of when Solid State came out. So we have to know what we own. We have to like it. And we can't just say, you know what? Buy and hold. You have to. To buy and do homework. All these things are about trying to get. Trying to get people.
- [29:10]
Scott Wapner
I like to buy and do homework.
- [29:11]
Jim Cramer
Yeah. I like, say, hey, listen, I'm going to buy a stock and just do great. And I Make these mistakes. I bought Bristol Myers and I didn't do enough homework on Bristol Myers.
- [29:20]
Scott Wapner
But you want people to be investors, not traders.
- [29:24]
Jim Cramer
Yeah, I mean, what happens? Look, I think that I was a professional trader for a long time. I just think that a lot of people are at home, they're watching me have money when they get home. And they can't compete with people who are just driven and know every piece of data. But they can, on the other hand, find some long term stocks and compound. And we all think that compounding is driven.
- [29:45]
Joe Terranova
All right, Jim, first of all, congratulations.
- [29:47]
Jim Cramer
Thank you.
- [29:47]
Joe Terranova
Joe, to your point, chapter four, finding an edge. Chapter 20, lesson two. Your stocks will tell you when to sell. As an investor in an environment that you, you and I both know, market structure has changed dramatically, what's the simplest way that you could do that?
- [30:04]
Jim Cramer
The simplest way you can tell is that you take a look at what just goes down and down and down. Then you look at the balance sheet. I actually give, I've never done the multiple stuff and I've never done the balance sheet stuff. You take a look at the balance sheet. I mean, a lot of people can't read it, but you know what we got, we have chat, we have perplexity, we have, we have grok. And you can ask them to take a look at the balance sheet and tell you whether it has too much debt. People have to start doing that. And the people who just say, listen, you just need to be in index funds, they don't realize that if you want to go look at Balance Health, thank you for telling me how bad Bausch Health was. You can go in and say, is that balance sheet any good? And it'll tell you, no, it's horrendous.
- [30:44]
Steve Weiss
But the other thing that you, that you focused on historically as we've known each other, is that if you know more about the company, you're more comfortable owning it and actually buying more to increase your return in turbulent times in the market.
- [31:00]
Jim Cramer
Yes. I remember my father sold boxes and bags for a living. We used to go to the Franklin Mills, this giant retail mall, and we would go on Saturday, he says, we're going to get in front of Gantos, which Goldman liked at the time. There'll be no customers. We sat there, there in front of it for five hours. No one bought anything. It was one of the greatest shorts I ever had.
- [31:19]
Scott Wapner
I mean, that's the Kramer channel check in the parking lot.
- [31:23]
Jim Cramer
I said, he said at the end, he said, we got to go in and buy something. This is a horrible day for them.
- [31:27]
Scott Wapner
And let me ask you this has your view of what you think the quote unquote right portfolio should look like as you've evolved, as the markets have evolved. Evolved. We grew up, you know, it's 60, 40 was the way people talked about the markets. But things are so different now. Investors have have different and greater access to more securities and asset classes than they probably have ever had. How do you think about that?
- [31:54]
Jim Cramer
Okay, I'm really glad you brought that up because one of the major themes of the book, and it's, and it's very radical and antithetical, but I think it shouldn't be to everybody here, is that you can own index funds and you can own some individual stocks. If you hear something that you like here, you can research it. You can make that one of what I call your five stock portfolio with one actually can be speculative.
- [32:13]
Scott Wapner
Yes.
- [32:14]
Jim Cramer
If you want to own an oclo, be my guest. You can have one of those after it's up 80 points.
- [32:18]
Scott Wapner
Only one, but.
- [32:19]
Jim Cramer
Well, yes, on a five stock portfolio. But I also want index funds. And look, we look at the, at the Trump funds, these new funds where you'll get $1,000. That's all index funds. So maybe you also buy one or two. Two stocks for a baby. Because I've got to tell you, individual stocks, whether it be Fang from 2013 or whether it be in video, they can change your life. I did a book signing yesterday at Barnes and Noble and there were a couple of people who removed the tears because they had retired because of Nvidia.
- [32:48]
Scott Wapner
Jim, I've seen it firsthand. I honestly, I'll let you know. Second, I've seen it. I've seen people come up to you at various places that we've ben and say very similar things. And it's so moving to see the impact that you've had on all of these years through all of these books.
- [33:05]
Jim Cramer
On the individual investor out there came up to me yesterday and said that he had made $1 million on Nvidia and it changed his life. But he, look, he's, he has a calling. He's still doing his job. He's not really a job for him, but it's nice when you see a regular person. I mean someone stop you on the street and say, listen, and I made $1 million on Nvidia. It is very moving for me and for him less.
- [33:27]
Liz Thomas
How do you in a market like this, I mean it's called how to make money in any market the way you've Made money in this market is to be a concentrated investor. Right. You talk about diversification in here. How do you tell somebody to stay diversified in a market like this, where it's like if you just owned those 10 stocks, you made a lot of money. If you were diversified, it was against you.
- [33:46]
Jim Cramer
It's a trick of the diversification is I say you can only be diversified among growth stocks. I have a list of sectors I say you can't buy because they're trading stocks. And that the after you drop one after another after another, what you're left with is growth. And I want you to be diversified among growth stocks only because I don't want more than one decision unless the company's fundamentals deteriorate and then you sell.
- [34:11]
Scott Wapner
All right, here it is again. How to make money in any market. It's Jim Cramer again. It's number eight.
- [34:15]
Jim Cramer
Thank you, buddy.
- [34:16]
Scott Wapner
MAN on all these.
- [34:17]
Jim Cramer
Thank you.
- [34:17]
Scott Wapner
Tell us, tell our viewers quickly what's coming up for you tonight on that.
- [34:20]
Jim Cramer
Okay, well, I've got a company that I think you all know that is just been eviscerated since a great last quarter. J. Bill, and they give you a good sense of how you can move your manufacturing, maybe deal with the tariffs. And plus, I'm dealing with the. I always like to look at the third quarter when we get to the fourth quarter, and sure enough, the third quarter winners are insanely great today. You know, maybe there's just don't fight the tape. Don't fight the Fed.
- [34:44]
Scott Wapner
Yeah, I love the show. That's the way a lot of people are thinking. There's a place for you anytime you want it. Don't be a stranger.
- [34:49]
Jim Cramer
Thank you. And remember, when you guys mention ideas, people should now say, I'm going to do my research. I really like that. And there's plenty of ways to research that didn't exist when we got in the business.
- [35:01]
Scott Wapner
Buy and do your homework.
- [35:02]
Jim Cramer
Thank you.
- [35:02]
Scott Wapner
All right, Jimmy. Thank you. That's Jim Cramer. The headlines now with some Silvana Hanow. Hi, Silvana.
- [35:06]
Silvana Hanow
Hey, Scott. Good afternoon. President Trump signed an executive order vowing to use all measures, including U.S. military action, to defend Qatar. The White House shared the text of the unprecedented security guarantee today on its website, but the order is dated Monday, the same day Israeli Prime Minister Benjamin Netanyahu visited the Oval Office and called Qatar's leader to apologize for a military strike last month. Activists on an international flotilla trying to break Israel's blockade and deliver symbolic aid to Gaza say they're preparing for interception. And it comes after they said Israeli vessels approached some of their boats and engaged in dangerous maneuvers. Israel did not comment. The more than 40 boats are carrying about 500 people, including Swedish activist Greta Thunberg. And the first batch of tickets for the 2026 World cup in the U.S. canada and Mexico are now on sale. The buyers were selected out of 4.5 million applicants who entered a visa lottery last month. Now, the schedule of matches, it is still months away from being finalized and there will be several more phases of ticket sales in the months ahead. Scott?
- [36:18]
Scott Wapner
Yeah, can't wait. Very excited. Definitely can't wait. Silvana, thanks so much, Silvana. Now up next, we have a fresh committee move to tell you about. Joe ready to talk about the Dow stock he just bought. We'll do it next.
- [36:32]
Narrator/Advertiser
Julia Boorstin sits down with Thrive Global founder and CEO Arianna Huffington.
- [36:37]
Liz Thomas
What advice would you give to young people now trying to navigate this crazy world? My advice is to pick a time at the end of the day that you declare as the end of your working day because let's face it, there.
- [36:52]
Jim Cramer
Is no end to our working day.
- [36:55]
Narrator/Advertiser
Julia Boorstin hosts CNBC Changemakers and power players. Listen now, wherever you get your podcasts.
- [37:02]
Scott Wapner
Welcome back. Let's talk about Joe's new buy. It is Merck and it is up 6% today, best two day period since 2009. What popped on your list about this?
- [37:12]
Joe Terranova
So I think this is a clearing event very similar to what we saw in Alphabet. Merck is a name that I've owned in the past, done relatively well with it. I understand the stock pretty good. So you've got a confluence of technical factors here along with fundamental factors. And I think that's allowing for a rebuilding of positioning, certainly an improvement in sentiment. The stock appears to be breaking out. Keep in mind the stock year to date, it's down 11%, but it's up 17% percent from its early low in May. Relief on import tariffs over the next three years. We heard that along with pricing relief from Pfizer along with the Trump administration the other day in the Oval Office.
- [37:53]
Scott Wapner
Oh, so that's what you're talking about.
- [37:54]
Joe Terranova
Clearing of bleeds through to the entirety of drug manufacturers themselves. It basically says the administration is open to a negotiation which each of these individuals individual names. And I think that's going to happen.
- [38:06]
Scott Wapner
Well, I mean the market's obviously moved a lot on this name. We just said the best two day period since 09. And I think there's you're going to get more to go. Okay. Because the inevitable question. Well, markets obviously pricing a lot of that upside in already.
- [38:18]
Joe Terranova
So Merck and the reason why I selected Merck, it's fallen aggressively from its June of 2024 high of 134. The company has really come under some challenging times. I think this is a restart. I think this is the type of catalyst where you see the rebuilds of positions.
- [38:34]
Scott Wapner
Okay, we'll do our calls of the day, top ones and some more committee moves or committee stocks making moves. We'll do that when we come back. Let's do some calls of the day. KeyBanc initiating QXO overweight. Why is she on that stock? What do you think? 28 bucks is the target?
- [38:53]
Steve Weiss
You know, the stock's been under, I wouldn't say pressure, but it's not really moved. It will. Brad just be very, very disciplined. Brad Jacobs CEO Founder just being very disciplined about the acquisition he's going to make. He bought Beacon Roofing and that is doing extremely well. He went to make another acquisition, but Home Depot is willing to pay a lot more. So I like the discipline. Brad is a permanent compounder himself like United Rentals, etc. XBO this will do quite well. Just be patient now.
- [39:23]
Scott Wapner
All right, Delta, I think you mentioned it earlier, Joe, it got upgraded today to a buy the target 70 from 62 at Jefferies. What do you think?
- [39:31]
Joe Terranova
I don't like that call. I'm sorry. I think there's a pretty good chance that the airlines peaked in the first quarter of 2025. Specifically as it relates to Delta. I don't like the fact that we're mentioning here that it's difficult to fill economy seats and the main cabin itself. They're relying too bulky much on the front of the plane.
- [39:50]
Scott Wapner
Berkshire Hathaway said to be near a $10 billion deal for deal. Excuse me, for Occidental's petrochemical unit. According to the Journal, Your stocks down 8% since Mr. Buffett announced he was stepping down on May 3.
- [40:03]
Joe Terranova
Not really reflected in the price action today or more recently, but this is a win on both sides. If you think about buying a chemical company, it adds to the 2011 purchase that they made of lubricant. All which is also a petrochemical company. In addition to that, what he has wanted for Occidental as the largest shareholder with an $11 billion stake is for them to shed a lot of their non, non core assets to pay down debt. This in fact does that for them.
- [40:28]
Scott Wapner
All right. It's a new all time high today For Welltower initiated overweight 195 at canner trending well above 20% they say on same store sales growth or a same store growth.
- [40:40]
Joe Terranova
What do you think we own it in the Jyoti. I really like it. From a fundamental perspective when you think about the REIT sector, think about senior housing and the exponential growth that's going to go on in senior housing. Senior housing stocks outperforming the REIT class itself by nearly 20% so far year to date. Another name you could own there is Ventas.
- [40:59]
Scott Wapner
All right. United Rentals upgraded to outperform from neutral target to 1,050 bucks. At Baird it was 888.
- [41:07]
Joe Terranova
That's a little bit generous in the price target. Be a little careful with this one. Any slowing in the economy is clearly going to impact the rental market.
- [41:15]
Scott Wapner
All right, up next, we do have the top ranked financial advisor in America according to CNBC's new FA100 list. He's here at Post 9. Next, CNBC releasing its seventh annual Financial Advisor 100 list today, recognizing the best FAs in the country. Joining us now, the President and CEO of this year's top rated firm, John Mullen Parsons Capital, here at post nine. As you see. Welcome and congrats.
- [41:45]
John Mullen
Thanks, Scott. Good to be here.
- [41:46]
Scott Wapner
You continue, you were two last year, so now you're the top dog. What's your strategy?
- [41:51]
John Mullen
So our strategy is really to focus on our clients. You know, it may sound sort of simple, but taking the the time to get to know them, you know, every person is different. What they come in with, what their needs are, what their concerns are and make sure that we're tailoring our approach to fit what their needs and desires are.
- [42:10]
Scott Wapner
Okay, so you're based in Providence, Rhode Island.
- [42:12]
Steve Weiss
Yes.
- [42:13]
Scott Wapner
Two billion under management. You've got about 1864 accounts under management. Do you have an investing philosophy that you sort of do you try and follow in the kinds of stocks that you pick?
- [42:26]
John Mullen
So we do. It's a little bit broad. We empower all of our portfolio advisors, portfolio managers to really build a portfolio that they think is appropriate for their clients. But when we look at it, you know, at a very macro level across the firm, we really try and focus on, on major themes that we think have long term, multi year staying power. We look for leaders in those things. Themes, you know, you think about right now, AI it, security, crypto, the deregulatory push that's benefiting a lot of firms, things like that.
- [42:57]
Scott Wapner
All right, so your top holdings in order, Apple 3M, Microsoft, Berkshire Amazon, JPM, Alphabet, Oracle, IBM. You have the Vanguard S&P 500 ETF. It's the VO for, for those of you who hold that as well as your large cap stock guy. I mean do you think that that is the trend that's going to continue into the remainder of the year? As we have this conversation every day, where do you want to be positioned? Do you want to just ride the large cap stocks in the market or do you think you're going to get a broadening down the caps space?
- [43:31]
John Mullen
Well, you know, certainly you've seen the Russell 2000 recently wake up and finally join the new all time high list. So we'll select effectively go down in cap scale. But we are pride predominantly, excuse me, in those large cap names. We do think that's the best place to be. Especially when you think about some of the uncertainties that are facing markets, facing investors right now. There's that safety with companies that can self fund, that can avoid some of the volatility that's likely going to come with the government shutdown, with tariffs, with all the other geopolitical stuff that's happening.
- [44:06]
Scott Wapner
I mean the market doesn't seem too concerned with anything. It's trying to be fixated on earnings and rate cuts. Is that how you're looking at it as well?
- [44:13]
John Mullen
Absolutely. And what's interesting is, you know, going into earnings season here, we're getting ready to announce analysts are actually upping their earnings expectations for the largest companies. Typically we see them cutting as we go in, so there's a low bar for companies to get over. So, you know, that tells us that, you know, companies are really feeling good about where they are and that's getting out into the analysts and for the Fed, you know, you see them cutting rates. We don't think aggressively, but they're able to do it while inflation's contained. Employment's a little soft here and that's going to be another leg to the stool for markets and stocks to advance off.
- [44:46]
Scott Wapner
All right, it's good to have you here. Congrats again. Number one, Parsons Capital. That's on the seventh annual CNBC Financial Advisor 100 list out today. We'll see you soon.
- [44:55]
John Mullen
Thanks, Scott.
- [44:55]
Scott Wapner
Thanks. Up next, next we're going global. China just had a blockbuster quarter. We'll find out how the committee is playing those names next. Stock China names standout quarter for those stocks. A real, I mean what a comeback. The k web up 22% Alibaba up 58 Tencent 20 PDD 26 JD up 10 Weiss I asked you this the other day. I love this part of Tony Tony P's note too. If Q1 belonged to European equity markets and Q2 belonged to the US Asia picked up the baton in Q3. Is there more to the race here for for these stocks?
- [45:34]
Steve Weiss
You know, I actually think there is, but I'm pretty sure there is. I'm just going to wait for a pullback which may never happen. So if that doesn't happen I'll take a look at the consolidation. I don't view Baba for example as expensive unless you put the risks associated with it which is that China does go after Taiwan. That's probably not this year or next year event but something that that the US is planning for at least. So that's the primary risk I've seen keep mind in the country's interest, China's interest to repatriate a lot of the talent that they sent over here who now is no interest in coming over here anymore or little Inc interest number one and making themselves not dependent whatsoever on technology outside the U.S. that's their number one imperative right now. And so as they continue to make it easy for companies to do that, I think you'll see the sector move.
- [46:30]
Scott Wapner
Liz, the emerging markets etf, better known as the EEM hit a new multi year high back to July of 2021. They do have many holdings that are just mentioned along with Weiss's Taiwan semi. What do you think about emerging markets China as a trade, as an investment, the eem.
- [46:47]
Liz Thomas
You can't buy the EEM without liking China because it's such a big slug in there. I like China. I use China as my final trade the last time I was here. I would use it again today if you guys would let me do the same one twice in a row.
- [46:58]
Scott Wapner
I feel like you just did.
- [47:00]
Liz Thomas
I still think there's good opportunity in China. I own the K web personally and.
- [47:03]
Joe Terranova
FXI showing similar to Yankee Stadium last night. A lot of swings and misses. Unfortunately for me that's what it's been in China. We will reassess at the end of the quarter.
- [47:12]
Scott Wapner
That was only the first game of the series.
- [47:14]
Joe Terranova
Is there two games worth of be there tonight? It's not going to be like I'm.
- [47:18]
Scott Wapner
Talking about knee stocks, not the game.
- [47:20]
Joe Terranova
Joe, big swing and a miss. As I said at the end of the quarter analogies. What we will do at the end of the quarter for the Jyoti rebalance is we'll look at a lot of these names which have strong momentum.
- [47:30]
Scott Wapner
I'm still trying to figure out the boat thing from the top, too. All right, Anybody else with me on that?
- [47:33]
Steve Weiss
A separate boat.
- [47:34]
Scott Wapner
We'll do final trains next.
- [47:36]
Joe Terranova
Two boats.
- [47:41]
Scott Wapner
Hope you join me three o' clock Eastern for the closing bell. I told you, Mark Lasry will be with me today. Well, so will Chris Farone and Kevin Gordon and Aya Yoshioka and JP Morgan's Matthew Boss. We have a lot to talk about on this first day of the final quarter of the year. Let's do final trades. Steve Weiss, you're up first.
- [48:01]
Steve Weiss
Yeah. First of all, I don't know which of the two boats Joe is going to put this in, but I'm going to go with Netflix. He had to go back there, right? I had to come at you. Netflix. Look, it's down on a tweet by Musk today saying, hey, you should boycott Netflix. You should cancel subscriptions. I think it's a buying opportunity.
- [48:16]
Jim Cramer
All right.
- [48:17]
Scott Wapner
Stock's down 2%. We'll continue to follow that. Liz Thomas.
- [48:22]
Liz Thomas
Yeah, Government's having a little trouble agreeing on where to spend money, but I think they keep spending it on defense. So.
- [48:28]
Scott Wapner
Xar, thank you very much. All right. All right, Captain, what do you got for us? What do you got?
- [48:36]
Joe Terranova
Apple continues to push higher. I am long. I think we're going to make a new all time high in Apple.
- [48:42]
Scott Wapner
Okay. Yes. All right.
- [48:43]
Joe Terranova
Well, I mean, we're not that far away.
- [48:44]
Scott Wapner
Yeah, we're not that far away. No, we're not. We got a mixed market. And I will see at 3 o' clock on closing bell again. Don't forget, Mark Lasbery is going to be on with me and I'll see you then. You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern only on CNBC.
- [49:04]
Narrator/Advertiser
All opinions expressed by the Halftime Report participants are solely their opinions and do not reflect the opinions of CNBC, NBCUniversal, their 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 Halftime Report 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 Halftime Report disclaimer, please visit cnbc.com halftime reportdisclaimer sometimes an.
- [49:44]
John Mullen
Identity threat is a ring of professional hackers and sometimes it's an overworked accountant.
- [49:49]
Joe Terranova
Who forgot to encrypt their connection while sending bank details.
- [49:52]
Scott Wapner
I need a coffee. And you need Lifelock.
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Joe Terranova
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- [50:08]
John Mullen
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