Scott Wapner (3:09)

Bar too high to meet Peru given to move in the stock 40% or so. There it is. There's year to date, but in the last three months, that's the whole, the whole show.

Bill Baruch (3:18)

Yeah. I do think right here, right now the bar might be a little high and we own it is our top position. But we are underweight at six and a half percent. It's funny thinking back to 2021, when I started these models, you know, we didn't want to own anything more than 4% or so. And I mean you have to own some of these names larger than that. It's what else you own around that. To Joe's point, you know, you could see Nvidia come down and some of the other tech names that hyperscalers kind of, kind of sit pretty well. But I think for Nvidia, assuming they beat, assuming the guidance is, is beat as well, I think it's really more about positioning and you know, past performance is not indicative of future results. But if you look back the May report, we were coming out of that tariff rally. I think that, you know, we finished up 7% that day is a little different. But the prior three reports going back to February and then two into 2024, that more similar to where we are now from a positioning standpoint, the expectations are mounted. We know what the hyperscalers did. Their Capex increased. Not only that, we're seeing the outside of the mag 7. Their capex is trajectory is higher too. So I think it's really going to be about positioning and then things like margins and then how the narrative of trajectory of innovations are going to come out. We'll hear more from Jensen.

Scott Wapner (4:30)

Well, we have our expert here, Christina Parts and evolution covers. The company is as looking forward to this report as anybody else. You've heard part of the conversation here. I mean, if there's something said, what's the most important thing that we need to hear tonight? How do you answer that?

Christina Parts (4:47)

China. Joe touched upon it, but he's highlighting a disconnect that we will see right when 4:20pm Eastern hits. Why is that? Earnings will come out. You have sell side that has a certain number, 52 to 53 billion dollars for their revenue guide. But buy side that number is higher at 54 to 55 billion assuming China is included. If that number isn't hit, you might see a sell off immediately. And that's the point. The disconnect where Jensen Wong would come on the call and speak to the growth, speak to possibly China entering, reentering the market, licenses, etc. You have to keep in mind AMD didn't include China in their guide. Nvidia doesn't break out China in their guide. They'll speak to it but they won't say specifically China contributed X or China licenses will contribute Y. So I think that is a big factor.

Scott Wapner (5:31)

So you need to wait for the call. Is that what you said?

Christina Parts (5:34)

I'm saying that you might see a big drop in either direction right when earnings hit at 420 Eastern because there is going to be a lack of details and that's where Jensen Huang would come in and sway people on the call.

Scott Wapner (5:46)

So be careful, be careful reaction in those initial reactions. Steve Weiss, you own the stock too. I told you what the options market is betting on either in either direction. But Christina raises a great point. Knee jerk on what happens could be an entirely different story depending on what Jensen Huang has to say on the call. And by the way he's had a knack of if not saving the day so to speak, certainly guiding investor expectations to be more positive. I mean I think the words he used at one point like no end in sight to the kind of capex spend that he had seen the demand that in video was facing. What's on your mind today?

Steve Weiss (6:30)

Yeah, no, Christina's way of, of playing it is absolutely appropriate. But and that's true of every tech company. It's always on the call where you get the clear direction. Look, if you go back and look last two or four quarters within video when they reported they've made all their guides but where they've missed on a couple of those two of those four is on the whisper number and the the stock has taken a major hit that point. It's one to one correlated with the overall market. So it trades more in the market than just its 8% or 6% weighted. So that's critical but it's also bounced back very quickly. So what I'd say is that just stay where you are. What I focus on is that China, while it's extremely important demand still continues to outstrip supply so they can make up for that demand elsewhere and that's eventually what they're going to do. So I'm pretty sanguine about the quarter, whether they make it, whether they miss the whisper etc. I do think the future remains bright.

Scott Wapner (7:39)

You have, you have any options action on this on this name?

Kevin Simpson (7:42)

No, we didn't sell any coals even though there's tremendous volatility and you mentioned the 6.2% implied movement we think the stock's going to react report well we think it's going to trade higher and.

Scott Wapner (7:51)

That'S why you didn't do that because I mean if you're if it's something it's sort of in your routine playbook to not do that going into a print like this speaks volumes to me.

Kevin Simpson (8:02)

Yeah, I would say it's almost outside of character because if we look at all of the other tech names we were hedging them into earnings. We were writing calls the week before. We're purposefully not doing it on Nvidia.

Scott Wapner (8:11)

You have that much confidence going in?

Kevin Simpson (8:13)

We do.

Scott Wapner (8:14)

Does that surprise you?

Christina Parts (8:15)

I'm just wondering. You spoke to Tom Lee yesterday and he gave a counter argument that there's been such a run up in the stock you name all of those stats just even since April, just over the last three months so why wouldn't it be an opportunity for profit taking given the run up and that it is much more heavily owned maybe less so just over the last few weeks with retail traders accordingly according to Goldman Sachs but overall maybe it could be an opportunity to get out.

Kevin Simpson (8:37)

I don't think there's ever a seller mass when it comes to which is the other problem like you're owning this, you're not trading it like we talk about some of the other names I think that's more the case with Nvidia because of its retail presence prisons we'll see tomorrow if I'm right but I think the stock's going to trade.

Joe Terranova (8:51)

Christina, how do we think about Blackwell demand in other markets outside of China?

Christina Parts (8:57)

It's it's still incredibly high and I think that we're underestimating, underestimating sovereign so you have Paris, you have all of these or I should say France. All of these countries that are willing to spend we don't have a number yet on how much they're actually spending and what that means dollars. Neo Clouds Cory was an example. They said that they're going to be second half of the year will be Capex heavy. Most of that spending will happen in Q4. So these are other sources of demand coming from beyond just the hyperscalers which we speak about. But to that point, Oracle saying insatiable demand. So they're definitely obviously bullish.

Scott Wapner (9:26)

I'll see you. I'll see you on the closing bell. Okay. I know you'd be following this all day and I'm sure we'll discuss more later. I want to debate a point that Joe made where he doesn't think that there's a lot riding on the overall market on this. Even though Nvidia is 8% of the S and P. Making the argument that, well, if there's a disappointment, well, you'll just take some money here and then you'll put it into the broadening trade. JPM today says within video the market needs a solid print to prevent triggering a pullback. It appears that a solid print will also trigger a rotation as some downside fears are assuaged in that scenario. Look for cyclicals and small caps with US dollar dictating demand for international and emerging market equities. Baruch, you want, you want to take that on that idea.

Bill Baruch (10:11)

I think we're heading into. Yeah, I'll take that on. I think we're heading into a seasonally weak time of year. This is sort of that worst month of the year and I do think that if this misses or if it beats and the reaction from a positioning standpoint is lower, I do think that you're going to see a profit taking across the board. I think that sets up for a really strong quarter. 4. I think the trade broadening is one way to look at it, but I do think that the mag sevens lead us at the end of the year. One thing that I think is really interesting to the VIX right now, there is a net short position by hedge funds in the Vix that the largest since middle of 2022 and you kind of look at that is if we start to get a wiggle, there is a shake that that could unwind a bit and that could be negative for the market at this time of year.

Scott Wapner (10:59)

I find your position peculiar in that you're telling me that if in video disappoints, it's not going to be a big deal for a stock that's 8% of the S and P that you'll just simply get a rotation into other areas of the market. This note says exactly the opposite, that a solid print, a solid print will trigger a rotation just because they're sort of like okay, Sigh of relief. Now the overall market and the AI trade concerns that have been I think more pervasive lately can be a little bit assuaged there. But you're telling me that they disappointed point and it's okay for the market at large because you'll just have a rotation from in video into broader areas.

Joe Terranova (11:39)

I think the market is thirsting for that rotation and I look good reasons not look bad I look at. Exactly. And that's the reason why I don't think you'll see a universal sell off. I think what does the tape look like? I think the tape looks like the S and P is down. I think the S and P equal weight is higher. I think the Russell is higher. I think you'll look at other stuff sectors that are not tech and communication services and seeing them getting a lift. I think when you look at the market overall it seems as though we are in a fundamentally strong position predicated on strong earnings and the expectation that now you have monetary policy that's going to adjust itself lower in the fall. With that being said, think about where everyone is currently positioned. I do not think universally people expect that small caps in under appealing areas of the market are finally going to get that follow through momentum that they've been missing for so many years. And I think that plays into exactly the type of rotation you could have if Nvidia Capital flows out of there in the max seven.

Kevin Simpson (12:44)

Yeah, I'm going to take.

Scott Wapner (12:46)

Hold on Weiss, I'll get you in a minute.

Kevin Simpson (12:48)

I just want to look at Nvidia so far year to date they represent 2.0.3.3% of basically the 10% that we've seen with the S and P. If you throw in Microsoft, Nvidia, Vago, Broadcom, Palantir, those other four names, that's half the return. So we need this stock to deliver for the breadth to take place because I think so much rides on it and not just from a performance standpoint. If they start talking about there being a lack of supply, excuse me, a lack of demand then you think of all that CAPEX 2425 $500 billion of sales spend from the hyperscalers. It's almost like a little stimulus of itself and if we see weakness there I think it affects the broader economy.

Scott Wapner (13:24)

The likelihood of them saying they see a lack of demand I think is slim and none and. And slim just left.

Kevin Simpson (13:29)

I'm making that bet too.

Joe Terranova (13:31)

I mean lack.

Scott Wapner (13:31)

But it's still. It still needs to meet a number. It still means needs to meet what is A been a, I think an elevated number given the move in the stock. They're not going to come out and say demand is weak. But if their demand is starting to maybe decrease in its appreciative growth, then okay, well maybe that's a different ballgame that we need to consider.

Kevin Simpson (13:55)

Weak may be a poor choice of words because to your point that's probably very unrealistic. But even any type of decay there because we're talking about looking at 2026 for $300 of earnings on the S and P. You need Nvidia to deliver if we want to get there on the back broader markets twice. For that reason I think it matters.

Scott Wapner (14:13)

Why? What do you think?

Steve Weiss (14:15)

Yeah, look, Joe's view is logical but I'm going to disagree. Also the markets traded lower when in video missed a whisper number. Meaningfully lower. Granted it was only for a few days and then bounced. Now what you've got the rest of the market that has had a move up. Not the same extent of the move that you've seen in Max 7, but nonetheless you've got Caterpillar that's moved up aggressively. Deer, I think they're even more vulnerable now than if they just move flatlining or down the year. So I do think it'll be an indication market plus and I know Joe knows this, you can't account for the Algos. So my view the Algos are likely geared because it's historic in terms of how it's traded. Geared to sell with. If Nvidia comes in with a disappointing number, I expect to miss their guidance. Disappointing relative to commentary.

Scott Wapner (15:08)

I just can't picture and maybe I'll be proven wrong if this in fact transpires. I just can't picture a scenario in which there's a disappointment from in video. And we come in the next morning and the NASDAQ's down a bunch and the S and p because of NASDAQ's waiting is down. But okay, well the Russell whistles up a lot because everybody just feels like, well let's just rotate into other areas of the market at the same time you would be questioning the durability of the trade itself if for some reason there's a disappointment from Nvidia. Now there's another report that's coming tonight that may not be as closely watched as in video. It should be because it's crowdstrike and the Cyber ETF is having its worst quarter since 2022. At a time when we are questioning software, software versus chips, AI killing software, etc. To which the Wall Street Journal was out with another piece today saying the death of software by AI is quote, greatly exaggerated. CrowdStrike. No one owns CrowdStrike.

Bill Baruch (16:14)

I own, I own CrowdStrike.

Scott Wapner (16:16)

What's the deal?

Bill Baruch (16:16)

Yeah, and I talk a lot about from a, from a positioning standpoint. Now we cut this name. It was just got into our top 10. It was about a three and a half percent position or so. We cut it by 40% in June, you know, going back to last, last year. I mean it got, we, we added to it before is added to the S and P and then it continued to rally and then when it had the software event with the airlines on last summer, it fell out pretty hard. So we didn't want to own it to that large of a position in our portfolio from a portfolio construction standpoint. And I think that's really what's important here is we're kind of waiting and seeing, seeing. And it's a very high multiple name. I think it's 1 or 2 or 110 is the forward on it. And so I think the expectations here, given where it's traded, we could trade lower and that may finally give us that, that summer low. But it also depends again what's the broader market doing. I think there's a lot of negativity going into it and they could overall give us a low if the broader market isn't trading lower.

Joe Terranova (17:14)

I own CrowdStrike personally. So here's what's interesting thing and this kind of blends into the conversation that we're having at the top of the show. Think about software, think about cyber security, think about the optimism surrounding cybersecurity. We know about AI tools and the need for cybersecurity, but cybersecurity is not trading well. Even after Palo Alto's earnings last week, you didn't get the lift. So tonight, net annual recurring revenue, the expectation is for CrowdStrike could be down about 4%. Okay, that might weigh on the stock, but you're looking forward. You're saying to self you're going to see the margin improvement as you move along. Software has been challenged already and guess what, the S and P is sitting near an all time high without software participating. So that's why it goes back to what I'm saying. The resiliency in this market is absolutely remarkable. Where are we today after the news from yesterday? No one, including myself would expect that. So yes, I do believe tonight.

Scott Wapner (18:12)

What do you mean the news? What's the news from yesterday?

Joe Terranova (18:14)

The news from yesterday surrounding The Federal Reserve. I do believe that.

Scott Wapner (18:18)

Why?

Joe Terranova (18:20)

Why what?

Scott Wapner (18:21)

Why would no one have, no one would expect where we are today given the news of yesterday.

Joe Terranova (18:26)

I mean really we're talking, we're going to have the whole conversation about the independence of the Federal Reserve. I'm surprised yesterday we woke up yesterday morning questioning the very independence of the Federal Reserve and we expect the market to go higher on that.

Scott Wapner (18:40)

You still think the Fed's going to.

Joe Terranova (18:41)

Cut if I told you in the.

Scott Wapner (18:42)

Morning you still think the Fed's going to cut in September?

Joe Terranova (18:45)

I think the Fed was more likely, I think the Fed was more likely to cut prior to yesterday morning. I think yesterday some people was a.

Scott Wapner (18:55)

More, they're more likely to cut after the fact.

Joe Terranova (18:57)

I think yesterday was a forced error on the part of the administration. They didn't need to do that. The Fed was already going to cut interest rates. They didn't need to step in and do what they did yesterday. So if anything the activity in the.

Scott Wapner (19:09)

Market yesterday was resilience suggestion that well, if Lisa Cook in fact does get fired and the President replaces her with somebody else who's more aligned with what he wants to have happen it all it all but seals the deal for the cut, doesn't leave it in any more questions question the market like because given the Fed statement and the White House's comments, the markets is looking past the noise focused on the cut.

Bill Baruch (19:35)

Breadth was bad yesterday. So overall, I mean I think The.

Scott Wapner (19:38)

Russell was up 8, 10 of a percent yesterday.

Bill Baruch (19:41)

But if you look across the sectors, Lilly was up, aerospace was up, financials were up on a broadening or steepening yield curve and it was the trade, it was the pre Nvidia buy. I was trading them the many Nasdaqs and I and I was trying to see this thing rolled over at all post that news. I was wrong and it ripped in my face. At the end of the day it was the trade. I think a lot of that was Nvidia getting bought and I think just the elevation levitation in the air trade that that is what kind of kept the market underpinned going into this. I think I'm, I'm as surprised as Joe is. I think that the Fed independence was, was continues to be in question. But it's like a lot of things it gets continues to get. The market's reaction continues to be more muted and more muted until it maybe comes to a boiling point. But, but when he was going to fire Powell we saw a much larger reaction.

Scott Wapner (20:29)

There's a difference between firing the chair with all due respect.

Bill Baruch (20:33)

Absolutely, absolutely.

Scott Wapner (20:34)

To a Fed governor, there's a huge.

Bill Baruch (20:37)

Difference between the two. I agree.

Scott Wapner (20:39)

Okay. And we would be having an entirely different conversation if we actually thought that firing Chair Powell was a legitimate possibility anytime soon. I can promise you that. Weiss.

Steve Weiss (20:52)

Yeah, look, first of all, wasn't new news yesterday. You had to believe since, since Lisa Cook's name is surface in this manner, which has been about a week, that the markets absorbed, number one. Number two, I'll give you a real opposite view of this, that if the Fed is controlled by Trump and they do continue to lower rates, the market's going to focus on lower rates. So it'll be a short term positive for the market. However, intermediate longer term is going to be a disaster because the last thing you want is a real estate person over, you know, having input in monetary policy, no less, one that's going bankrupt multiple times because of the benefits of cheap money. So, so short term positive for market, mid term, long term, extremely negative.

Scott Wapner (21:41)

Well, that's kind of the idea from the op ed from the editorial board of the Wall Street Journal today. For those who might have seen that.

Joe Terranova (21:48)

Just look at the yield curve. If you would look at what the yield curve has done, look at the steepening. The front of the curve is respecting what you're saying. Yeah, you're going to get your rate cut and you might get further rate cuts. The long end of the curve is seeing what I'm seeing. You might have a bigger problem here that's going to have to get addressed at some point. And maybe it's 2026, but it's a reckoning moment.

Bill Baruch (22:10)

Bond futures sold off immediately following that announcement on Wednesday night.

Scott Wapner (22:14)

So we've gotten off on a bit of a tangent, which is fine because it was worthy and Joe teed us up to have a little heat, which I always enjoy. I want to get back, though, to part of the software conversation we're having because it leads into a move that we've had on the desk. Not all software stocks, by the way, have been in the dump. MongoDB, we can throw that up. So that was up huge Wolf today calls that name software's new mvp. And maybe that space needed a new MVP because what looked to be, or the few names that look to be MVP candidates have suffered lately. You bought a software named Kevin Simpson. It is Unity Software.

Michael Santoli (22:53)

Why we bought this in the new growth strategy.

Kevin Simpson (22:56)

And I want to caution viewers before you follow me into this trade, this stock behaved, although it wasn't officially a meme stock very Meme Ishly. This thing was at $200 a share in 2021, traded down to $13. We bought shares this week, excuse me, at 39 and change. Looking at it as a recovery story, really what they're involved with is three dimensional video game platforms but also getting into the virtual reality world, doing some things with electronic vehicles moving outside of the pure video game space. We also have an advertising agenda that's going to go and try to compete with Applovin. They're far, far, far removed from being able to do that as a real player. But this is a speculative name that we like as a recovery. We have a tight stop loss on this Scott, but if it works, it could work in a big way.

Scott Wapner (23:44)

All right, well we'll watch it. It's coming off the line lows, that's for sure. The other thing I wanted to hit in our first block of the show today is the breather that some of the high flyers in this market have been taking of lately of late. Coinbase. The April low through July stocks up 150% month to date down 18%. GE Vernova Vistra, NRG Trade Desk Microchip, Generac Constellation on Semi Datadog, KKR Eaton. We're talking about gains from the April low through July of not in no particular order, 100%, 90%, 80, 50, 60%. They're down month to date. Bitcoin. You see bitcoin, it's taking a breather as well. Got above 120k and now it is about 10% off of its record high. It's down almost 7% in a couple of weeks. You have a take on what's happening here.

Bill Baruch (24:43)

I think in the energy side there's a bit of a wrench thrown into the, the investment infrastructure a bit. But you know in some of these softwares names like Oracle down 8% but it's up 45% year to date. I think the sector kind of is weighing on a name like that Coinbase. I think it's, it's honeymoon over from post inclusion of the S&P 500. So I think there's a lot of idiosyncratic things that are, that are dragging some of those high flyers down and I think it's just a breather. I hope and kind of think that the market in general can, can overall refresh a bit and pull back post Nvidia and then we set up for a strong quarter four whether that be more of a broadening trade early but I think that this could be a little bit of you know, you know, a little down the tunnel giving us an eye on maybe what could come here as some profit taking and some shifting happens.

Scott Wapner (25:32)

All right, big day for the banks today. As you as you may know, we're talking all time highs yet again. A new note makes our call today. We'll trade it next.

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Scott Wapner (28:06)

I mentioned before the break, yes indeed, it's a big day for the banks. We have several names hitting all time highs today, including Goldman Sachs, Morgan Stanley, Some of the regionals like synchrony bank of New York Citizens, you want to start us off. I mean you could go big because you own Goldman and Morgan Stanley XLF New High, or you can go smaller because you have had more exposure in that area than anybody on the show.

Joe Terranova (28:31)

By a lot more quantified at 35%. I mean it's, it's obscene to a certain point. And we've been building that exposure in the Jyoti ETF since January of 2024. As I said the other day, I keep waiting for the moment where we begin to see a paring back in some of the holdings. But whether it's insurance, private equity, regional banks, money center banks, brokers, asset managers, we just continue to build positions. I do think that kind of in line with the conversation we just had with seeing a lot of the momentum names pulling back like a coinbase and others. I do think in the financial sector you have to be respectful of the valuation. The valuation is getting a little bit stretched in the names like JP Morgan, in the names like Goldman Sachs, which I own personally. I think that's why one of the reasons why the regional banks are getting a lift here. We own Citizens Financial Group, we own Regions Financials. Those are two companies that have seen a significant improvement in the assets on their balance sheet. They've done an excellent job in kind of cleaning that up. And I think that's really underneath the surface what's happening here. Being very respectful of valuation is important in the financial sector. I think that's evidence of the last year.

Scott Wapner (29:45)

You're the first person I can recall call is my memory serves me well that has talked about a bank stock as having a valuation that is potentially too rich because that has not. No it's been anywhere close to the conversation that we've had on this desk for now as long as I can possibly remember. No. And everybody's always like, well they traded at such a discount to book and blah blah blah. Now you're telling me that JP Morgan, which I don't even know what its forward PE is we can put pull it up. I think I saw that Goldman's was 15. What's JPM? What do you think it should be?

Joe Terranova (30:18)

15. That's, that's probably right about in line but if you're looking over the last, you know, 15 years, listen, you got to throw out 2006. You want to talk about 2006, we could talk about Regions Financials at $39. We don't need to go back today. It's struggling we get above its 5 year high.

Scott Wapner (30:35)

Are you saying over the last general are now too rich?

Joe Terranova (30:38)

No, that's not what I saw said that's not what I said. I said there are select few of the money center banks like JP Morgan, like Goldman Sachs that we have all owned that we have all talked about on the show. Josh has owned JP Morgan for as long as I could remember.

Scott Wapner (30:52)

That's right. Weiss owns Goldman.

Joe Terranova (30:54)

Weiss Steve has been with me. Goldman Sachs. I apologize Kevin, I'm sure you're there with us as well but in March of 23 abort JP Morgan and all I'm saying is that some of those names maybe the valuation is getting a little bit stretched relative to the earnings that they're delivering and what you're seeing in the most recent weeks is that the market is doing a little internal sector rotation and it's looking at some of the regional banks and they are definitely undervalued relative to their money center bank peers.

Scott Wapner (31:24)

Weiss, I've teed you up well because you got bank of America new 52 week high. Goldman Sachs all time high. You're not in J.P. morgan I don't believe but what about that comment?

Steve Weiss (31:36)

No, you know it's interesting. I'd agree with it frankly on a price to book which is typically have banks trade they're getting up there and JP Morgan's always been up there. Goldman's actually at a discount to where it's historically but if you take a look where the yield curve is you pointed to how it's steepening that's really.

Joe Terranova (31:59)

Where the correlation is.

Steve Weiss (32:01)

And then in a robust market and we've all talked about the IPO calendar the M and A calendar as rates come down. So lots and lots of tailwinds here and the overall valuation of the market also which is fair I would say if not a little stretched is a valuation umbrella. So you look for equity capital work. So I'd say it's a great environment as is reflecting the stocks. I don't think they're overvalued here for everything I said so I think there's more room to run.

Scott Wapner (32:31)

I mean look bank of America relative to JPM and Goldman is is cheaper 12 times rather than 15. Bill Baruch, what's your play here?

Bill Baruch (32:40)

We own JP Morgan and we own Goldman Sachs number nine and 10. I I've said it earlier in the show, the steepening yield curve I think is a great tailwind here and taking the words again from from Weiss was the mergers and acquisitions and the dealmaking activity continues to beat expectations. I think these are great names to hold and I think that they are over the next 18 months going to be higher than this in the near term. I'm just not sure if we're going to continue to accelerate at this pace.

Scott Wapner (33:08)

All right, let's get the headlines with Silvana Head now. Hi Silvana, Afternoon.

Commercial Narrator (33:13)

Well, in a press conference just moment ago, Minneapolis Mayor Jacob Frey shared an emotionally charged message regarding the pain and gravity of the shooting at the Annunciation Catholic School this morning.

Kevin Simpson (33:25)

Don't just say this is about thoughts.

Bill Baruch (33:27)

And prayers right now.

Scott Wapner (33:28)

These kids were literally praying. It was the first week of school.

Bill Baruch (33:32)

They were in a church.

Commercial Narrator (33:37)

According to the police chief, two children were killed in the shooting. Seventeen people were injured, including two who are in critical condition. The gunman died of a self inflicted wound. Microsoft is investigating employees who occupied President Brad Smith's office Tuesday to protest the company's ties to the Israeli government. The group alleges Israel uses the Azure cloud service to target Palestinians. Microsoft says it has no evidence of its software being used to harm people and Nevada is recovering from a cyber attack this this week. But the governor's office said authorities have found no evidence that personal information was compromised. Emergency services weren't affected and the governor says individual agencies will notify residents when in person. Services are up and running. Halftime. We'll be right back.

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Scott Wapner (36:02)

Welcome back. Let's do some more calls. CLSA initiates micron today. Outperform 155. The target QUOTE riding the crest of the air wave. Bill, you own the name. A name that doesn't get discussed all that much to be honest when we talk about the air wave.

Bill Baruch (36:16)

Not discussed enough. I mean this, this name, I've loved it for a while and it's been our portfolios. High bandwidth memory, you know faster computing for efficient computing at a lower power consumption. It's going to be critical here in the air race and they're very well positioned the center of it pretty much to capitalize on it. This name trades at 9.5 forward and just grew earnings 200%. I love this name. I think we're going to continue to move now. It is, it trades like a commodity. This thing moves fast.

Scott Wapner (36:45)

Well look at the year to date. Yeah, I mean look at the year to date. For a name that you said not talked about enough. Trades at nine and a half times forward is up like 40% year to date. Why isn't the story more now?

Bill Baruch (36:58)

I mean we've known it, we've been talking about it internally. It's right outside our top 10. Sizing this name is really what's important. Last year we got right outside our top three. We held it with about a 4% and we even trimmed it at 150. But the thing was almost cut in half. I mean it trades very volatile for us. It's a long term story and really this thing I think it could exceed on the next move. Exceed 1 150. Just patience and sizing it properly it.

Scott Wapner (37:26)

Was down like barely north of 60. And here we are at 118 DoorDash. Reiterated by today 305 Loop Capital. While valuation leads gig economy peers and the stock is not cheap. We think that with superior growth, considerable earnings power beneath ongoing investment, open ended opportunity and best in class management premiums warranted. Joe, you agree?

Joe Terranova (37:46)

Excellent note. I fully agree. That's. That's great description of what's going on here. 8-7-278 post earnings high stocks pulled back right into the 50 day moving average. I think it's a nice setup here to purchase a company that's got 30% revenue growth.

Scott Wapner (38:01)

Amherst Sports upgraded to buy today 50 bucks. The new target was 38 and that's at HSBC. Bill Baruch, you own the name?

Bill Baruch (38:11)

Yeah, we, we love this name. Really good for our consumer. Cyclical exposure. Love the portfolio of brands. Everything from Solomon, arc, Teryx, Louisville Slugger expanding with some brick and mortar even in soho here. They saw, they opened it last year. This name is going to continue to expand in the pickleball discussion here. They, they own, they own Wilson as well. So I think it's a great one.

Scott Wapner (38:36)

All right. Morgan Stanley makes some biotech picks today which they suggest going global. It's at a pivotal moment, they say, as China transitions from traditional generics manufacturing into the global innovation ecosystem. Stocks to play globally include Amgen and Merck. Kevin, you own Amgen and Merck.

Kevin Simpson (38:57)

Both are down over the past 30 days. I agree with the call. I think there's a play here. We rotated into Merck when we got out of United Healthcare. It's up nicely. We know they're going to lose, lose Katruda. Amgen made acquisitions that we think are very accretive to the bottom line. I'm not sure how aggressively you want to pile into this trade over the short term, but we like it intermediate, long term, a lot.

Scott Wapner (39:16)

Joe T. Welltower. Target at 185. That's 10 bucks higher than it used to be and overweight at Wells Fargo.

Joe Terranova (39:22)

This is a reit. This is senior housing and acute care. We got into the stock July of 24 at $111. It has rewarded us. I think it continues to, to move higher. They are situated in a perfect industry in a demographic that only continues to get more and more.

Scott Wapner (39:39)

Costco reiterated outperformed today, tells the advisory group 700 bucks is the new price target. They expect solid August sales results. You own that one too.

Joe Terranova (39:51)

Costco and Walmart have really struggled here over the last 30 days.

Scott Wapner (39:55)

Why is that?

Joe Terranova (39:56)

These are two names. You know what, it's interesting because my response to your question is going to be purely exhaustion. Exhaustion and positioning and sentiment that got to an extreme. One could make the argument from the valuation perspective. They're expensive, they're beyond their 10 year average. I get it. Wal Mart's like 34 times. I think Costco's 47 times. But these have been the anchors of quote unquote being safe havens over the last five years. Over the last five years they both have outperformed form the S&P 500. So I think it's nothing more than a situation where they are exhausted. They're now being unchanged times, yeah, forward. It's literally they're teetering on being unchanged for 2025. And I think what that really does is it challenges, the overweight positioning. I think you're going to have to see some liquidation here of ownership and that might mean that there's further downside.

Scott Wapner (40:48)

You're willing to pay a bit of a higher premium, obviously, obviously, for the recurring revenue model and the safety. Right.

Joe Terranova (40:55)

The safety itself.

Bill Baruch (40:56)

49 times we get technical real quick. Costco head and shoulders pattern, potentially. There's a lot of support at 900, but if it gets below 900, this could end up showing to be a bit of a crowded name and see some heavy selling below 900.

Scott Wapner (41:08)

All right, we'll take a quick break. Santoli, he's on the other side with his Midday Word. We're back right after this. Michael Santoli is at post 9, our senior markets commentator for his midday a word. 8% of the s and P. I don't think a name has ever had as large a weighting on the index as Nvidia does today. What does that mean for our viewers as they watch these earnings come down and how they should think about the impact to this market?

Michael Santoli (41:59)

Not since you've been able to actually own the index. I think in the primordial times, maybe we did have 8%. We've seen it go every which way. Right where it's Nvidia blows the doors off, they raise guidance beyond the hopes of the street it runs. It gives a green light to the AI trade or we've seen modest disappointment perceived. It's ahead of itself. We're going to back off. And it hasn't always taken the rest of the market with it. What I'm really fascinated to watch is no matter which way Nvidia reacts, do we get the counter move from the 493, from the Russell 2000? Because if you look at the last couple of days, it's been a seesaw between the Russell and the ndx and it's trading off and it's netting out to a pretty positive tape in the sense of the S and P is hanging by the highs. It's at a basically closing high right now. I do think that you can sort of take some heart in that. It's going to be hard to pull the market away from this idea that they're kind of getting the dessert along with the meal here, which is a fair Fed going to cut rates into a decent earnings picture. But, yeah, this is a test of that. I think, if nothing else, I'm taking heart.

Scott Wapner (43:08)

Sounds like I'm taking it back a little bit.

Joe Terranova (43:11)

Look, I'm taking heart a little bit. Listen, this game, this game is about. This game is all about how you're reshaping risk. And if I'm wrong in exactly what Mike is describing and there is a universal sell off, then that's, that's a calling to kind of reshape the risk. But you have to to kind of go with what the market is messaging you. And I think to Mike's point, the last 48 hours are signaling that's thirsting for the broadening out for the 493.

Michael Santoli (43:35)

Wants to try that. The thing I would say is we didn't get a real reset. We were in the market paused in the beginning of August. I just don't know how much we've reloaded for some great move higher if it's just going to be a grind or you know, maybe we have to back off in September to reload.

Scott Wapner (43:51)

He'll send you a thank you after the show.

Joe Terranova (43:53)

Yes, I think he'll, he'll deliver maybe Yankee tickets.

Scott Wapner (43:56)

I'll see on closing bell. That's Mike Santoli. Two more committee moves right after this break. Welcome back. I told you we had a couple committee moves to get to. Bill Baruch has bought more Berkshire Hathaway, which hasn't traded well since Mr. Buffett made that now historic announcement several months ago. We'll show you a chart what the stock's done since that day. Why did you buy more here?

Bill Baruch (44:36)

It's traded well in the last couple of weeks and like Apple, I want to buy this name when it's unloved. I think there's better things to come here. And this is also from a positioning standpoint, we're underweight financials though we are very overweight. JP Morgan and Goldman Sachs. I want to broaden our financial exposure and hit on the broadening trade that Joe's been talking about. If we get that cyclical move outside of the Max 7, you know it's going to be Berkshire. If you go back to even just February, this was a massive leader when, when all the tech names are sort of just under underperforming. So I want to make sure that we get up the weight in this, this we're almost up to Wayne Berkshire. I see another ad down our, down our path here as well. But the insurance exposure I think is great. The cyclical exposure is great and it really helps to round out our portfolio.

Scott Wapner (45:20)

Stocks rebounded obviously as you see on, on your screen there a little bit. But the trend from the Buffett announcement till later in the summer has been a one way direction. You own it.

Joe Terranova (45:32)

I do the momentum is broken in this stock. I will tell you that it has been broken now for the better part of the last four months. So it will be interesting to see at the rebalance in the fall what happens with this.

Scott Wapner (45:45)

Well, maybe it's getting it, is it getting it back now?

Joe Terranova (45:48)

To some degree. It's, it's too far, it's too far away from, from where I see it situated right now. It's right back at the 200 day moving average, the 50, the 100. It's all kind of rolled over.

Scott Wapner (45:59)

Kevin bought Jones Lang LaSalle. Commercial real estate. Why?

Kevin Simpson (46:03)

We think there's going to be a rate induced stimulus, a rate cut induced stimulus in real estate not just for residential and refis but also in commercial and multifamily. This is a name that's hitting 52 week highs. It's not a new name to real estate investors up 20% year to date but they've got it all. One stop shop. If you're looking for commercial multifamily, they'll find it, they'll manage it, they'll sell it. They've got an investment arm, really neat diversified real estate play. We're excited about it.

Scott Wapner (46:30)

All right, finals are next. Well, to say we have a big one coming up on closing bell would be a bit of an understatement because we're going to count you right down to the release of Nvidia's earnings. We're going to do it with Josh Brown, Gene Munster, Bryn Talkington. We've got Roger Ferguson with us today and Stephanie Link. So we have a stacked deck as they say. I hope you'll join me. Three o' clock eastern time. Steve Weiss, what's your final ftai?

Steve Weiss (47:08)

I don't think this stock is dependent upon Nvidia and I see this going to 200.

Scott Wapner (47:14)

Thank you very much.

Kevin Simpson (47:15)

Kevin Simpson heading into next month's event. We like Apple, great third quarter numbers. I'm excited about the iPhone air and I for one will be getting one.

Scott Wapner (47:24)

Okay, great. Good to know. Thank you.

Bill Baruch (47:26)

Bill Baruch CD Core Mining. It is a gold and silver 30% revenue. Silver miner breaking out above the 2021 highs. Potentially looking good.

Joe Terranova (47:36)

Joe Refiner trade momentum continues to build.

Scott Wapner (47:38)

All right, psx. Thank you. We'll see you on the bell. You've been listening to CNBC's Halftime Report report, the podcast you can always catch us live weekdays at 12 Eastern only on CNBC.

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