Halftime Report: Buy Tech’s Bounce? (February 18, 2025)
Hosts: Scott Wapner, Joe Terranova, Josh Brown, Sarat Tsaitsi, Brian Belsky, Sarah
Release Date: February 18, 2025
Overview: In this episode of CNBC’s Halftime Report, host Scott Wapner engages with top investors to dissect the current market dynamics, focusing particularly on the notable resurgence in the technology sector. The panel delves into market resilience, sector-specific performances, strategic stock positions, and the evolving landscape of both domestic and international markets. The discussion is enriched with expert insights, strategic stock evaluations, and forward-looking perspectives on investment opportunities.
1. Market Resilience and Current Highs
Key Discussion Points:
- The NASDAQ 100 is building on its best week of 2025, nearing a new closing high for the S&P 500.
- Resilience is highlighted despite bouts of volatility, with the VIX index demonstrating significant stabilization.
Notable Quotes:
- Scott Wapner [01:03]: "Tax reemergence. The NASDAQ 100 looking to build today on its best week of 2025."
- Joe Terranova [01:50]: "The resiliency is remarkable. We've had three bouts of elevated volatility... the Vix is towards 15."
Insights: Joe Terranova emphasizes the market’s ability to maintain resilience even amid volatility, pointing to low VIX levels and stable treasury markets as indicators of investor confidence. The transition into a buyback period suggests sustained engagement with risk and an expanding investment thesis across multiple asset classes.
2. Technology Sector’s Rebound
Key Discussion Points:
- Significant gains in major tech stocks like Apple, Nvidia, and Meta contribute to the overall market uplift.
- Panelists discuss the overproportionate impact of large-cap tech stocks and the broader participation across the sector.
Notable Quotes:
- Brian Belsky [03:19]: "The demise has been widely blown out of proportion and that's why we've remained quite overweight the sector."
- Sarah [04:07]: "Companies are being rewarded to spend because they've had some good ROI on the expenditure."
Insights: Brian Belsky counters the narrative of declining large-cap techs by highlighting strong fundamentals and rebounding growth rates. Sarah supports this by noting that current tech companies are effectively executing growth strategies, leading to diversified market uplift beyond just large-cap names.
3. Strategic Stock Evaluations
a. Trade Desk and Applovin
Key Discussion Points:
- Trade Desk: A heated debate on whether to hold or sell, with differing opinions on its future prospects.
- Applovin: Discussed as a valuable asset despite recent volatility, emphasizing long-term potential.
Notable Quotes:
- Joe Terranova [11:00]: "You must risk manage your position because there is literally no reason to be in Trade Desk right now after what we witnessed last week."
- Josh Brown [13:06]: "It is a very unique company... connected television advertising market is not going away."
Insights: Joe Terranova advocates for exiting Trade Desk due to recent downturns, while Brian Belsky maintains a long-term bullish stance, citing strong fundamentals. Josh Brown underscores the potential of Applovin, urging investors to hold for long-term gains despite short-term setbacks.
b. Gilead and Merck
Key Discussion Points:
- Gilead: Upgraded to a buy with a target price of $120 due to strong pipeline and cash flow.
- Merck: Downgraded to hold from buy, reflecting challenges despite long-term holdings.
Notable Quotes:
- Brian Belsky [28:06]: "Gilead is both tactical and value... we're doubling our position over the last year."
- Joe Terranova [30:49]: "Does Merck look like a momentum name to you? No."
Insights: Belsky highlights Gilead’s robust pipeline and financial health as reasons for upgrading, whereas Merck is positioned more cautiously, reflecting its current underperformance and sector challenges. The discussion underscores the importance of strategic positioning based on company fundamentals and market performance.
4. International Market Dynamics
Key Discussion Points:
- Significant rallies in European and Asian markets, challenging the notion of US exceptionalism.
- Shift in global equity performance with benchmarks like the DAX and CAC 40 experiencing robust growth.
Notable Quotes:
- Josh Brown [23:23]: "Europe's breaking out... 73% above their 200."
- Joe Terranova [25:18]: "Hang Seng up 14%. Mexico up 10%. Brazil up 7%."
Insights: The panel observes a broad-based global equity rally, with Europe and Asia showing strong performances. Josh Brown advocates for capitalizing on this trend by focusing on large-cap European stocks with undervalued multiples. Joe Terranova adds that emerging markets like Brazil and South Korea are also exhibiting strong growth, presenting diverse investment opportunities beyond the US.
5. Access to Private Markets and Regulatory Changes
Key Discussion Points:
- Discussion on democratizing access to private markets by potentially loosening SEC regulations.
- Concerns about investor protection versus capital formation benefits.
Notable Quotes:
- Silvana [35:23]: "Renewed momentum around changing the SEC’s accredited investor laws."
- Josh Brown [37:37]: "People are going to lose a lot of money... best companies don't come public until they're already large caps."
Insights: The conversation highlights ongoing efforts to make private equity and venture capital accessible to retail investors through regulatory changes. While proponents argue this could enhance capital formation and market liquidity, critics warn of increased risks and potential losses for less experienced investors.
6. Closing Strategies and Final Trades
Key Discussion Points:
- Final stock picks and strategies from panelists, focusing on growth and momentum.
- Emphasis on risk management and strategic entry/exit points.
Notable Quotes:
- Josh Brown [46:32]: "Watching Toast’s report this week."
- Brian Belsky [41:28]: "Walmart and Costco are the only names you should own in Staples."
Insights: The panel concludes with tailored stock recommendations, advocating for holdings in resilient and high-growth companies like Walmart and Costco. Emphasis is placed on maintaining strategic positions and being vigilant about market movements to optimize returns.
7. Legal and Regulatory Updates
Key Discussion Points:
- Federal judge’s review of access restrictions for Elon Musk and Doge staffers.
- Blockage of former President Biden’s student debt relief plan by a federal appeals court.
- Nike’s strategic partnership with Kim Kardashian’s Shapewear company, Skims.
Notable Quotes:
- Silvana [32:36]: "A federal judge is expected to rule today on a request to temporarily block Elon Musk and Doge staffers..."
Insights: Silvana provides updates on significant legal rulings affecting high-profile figures and government policies. Additionally, the strategic alliance between Nike and Skims signals a targeted approach to expanding market presence and appealing to female consumers.
8. Final Market Sentiments and Future Outlook
Key Discussion Points:
- Mixed investor sentiments with institutional optimism contrasting retail bearishness.
- Potential challenges ahead with regulatory measures and economic policies.
Notable Quotes:
- Mike Santoli [43:30]: "Market has largely been pretty resilient and able to ingest all the noise..."
- Sarah [46:44]: "Salesforce AI."
Insights: Mike Santoli remarks on the nuanced investor sentiment, noting the disparity between institutional confidence and retail caution. The discussion acknowledges potential headwinds from regulatory changes and economic policies, but remains cautiously optimistic about sustained market resilience.
Conclusion:
The episode encapsulates a comprehensive analysis of the current market landscape, emphasizing the rebounding technology sector, strategic stock positioning, and the expanding horizon of international and private market investments. Panelists advocate for diversified investment strategies, robust risk management, and staying informed about regulatory shifts to navigate the evolving financial terrain effectively.
Notable Timestamped Quotes:
- Scott Wapner [01:03]: "Tax reemergence. The NASDAQ 100 looking to build today on its best week of 2025."
- Joe Terranova [01:50]: "The resiliency is remarkable. We've had three bouts of elevated volatility... the Vix is towards 15."
- Brian Belsky [03:19]: "The demise has been widely blown out of proportion and that's why we've remained quite overweight the sector."
- Sarah [04:07]: "Companies are being rewarded to spend because they've had some good ROI on the expenditure."
- Joe Terranova [11:00]: "You must risk manage your position because there is literally no reason to be in Trade Desk right now after what we witnessed last week."
- Josh Brown [23:23]: "Europe's breaking out... 73% above their 200."
- Silvana [32:36]: "A federal judge is expected to rule today on a request to temporarily block Elon Musk and Doge staffers..."
- Mike Santoli [43:30]: "Market has largely been pretty resilient and able to ingest all the noise..."
This summary provides a comprehensive overview of the Halftime Report episode, capturing the essence of discussions, key insights, and strategic recommendations for investors navigating the current market landscape.