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Halftime Report
Can the Market Bounce Continue 3/24/25
00:43:56
Scott Wapner and the Investment Committee debate whether stocks can continue their reversal higher. Plus, multiple Committee members are making some major portfolio moves, they detail their latest trades. And later, the desk discusses the latest calls of the day. Investment Committee Disclosures
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- [00:00]
Scott Wapner
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- [00:32]
Ben Rizzuto
Hello, I'm Ben Rizzuto, wealth strategist at Janus Henderson Investors. Is a brighter future possible? At Janice Henderson we think it is. We've worked to help clients achieve superior financial outcomes and fulfill our purpose of investing in a brighter future together. We never forget that this means our thinking and our investments are helping to shape millions of futures. At Janus Henderson, we're committed to helping you invest in a brighter future. The Learn more go to Janice Henderson.com.
- [01:03]
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. All right. Welcome to THE Halftime Report. I'm Scott Wagner. Front and center this hour, the state of stocks which are bouncing. As you know, again today we will debate and we'll trade it with the markets. We'll trade the markets with the investment committee. Joining me for the our Joe Terranova, Jim Laventhal, Steve Weiss and Brent Tolkington. We will go to the market, show you exactly what we are doing. There is green across the board today. So we have this news, Joe, the tariff news, really, the Wall Street Journal reporting that tariffs on industrial sectors like cars and chips are not likely to be announced on April 2. Therefore, you look at names like Nvidia and Micron and AMD and Broadcom and Ford and gm and they are all bouncing, as you would expect. And Tom Lee is out with a note today that says the markets are setting up for a potential face ripper rally. Is that what you see? Does this bounce go on?
- [02:06]
Ben Rizzuto
Well, I do see ahead of us this week that we have now a lot of positive momentum and we also have a little bit of a mean reversion. And what I mean by that is some of the overseas names that were carrying the market, some of the areas of the market that the defensively oriented sectors that were carrying the market over the last several weeks, you're now seeing that other areas, like the momentum names which have stabilized, like the Magnificent Seven, are Taking leadership again. So what do I think that means? I think for the remainder of the week, as you move into the end of the quarter, I do think you're going to see markets continue to move higher. I do believe that this rebalance that we're going to see at the end of the quarter could be significant and probably will lead towards the expectation that you want to get in front of what will be perceived to be buying of equities at the end of the quarter and maybe a little bit of selling of bonds concurrent with that. But clearly I think we've seen in the month of March probably the worst during the week of March 10th. And from there we've had a nice little recovery that could extend into April.
- [03:12]
Scott Wapner
Weiss, are we set up for a face ripper rally like Tom Lee suggests? We had a nice little bounce. We, we're up 4% from the low. We, the S and P, we're only only down 2% on the year. I know the one month period looks a little worse.
- [03:29]
Joe Terranova
Yeah.
- [03:29]
Scott Wapner
But for everything that the market's been through, down 2% year to date. Okay.
- [03:35]
Joe Terranova
Yeah. And I think there's broad agreement on the desk on Friday about a buy on the news that in other words that when April 2nd comes negativity will be so high by that point positioning so low that you'll see that face ripping rally after that. What we're doing now is pulling that forward and today's news was a catalyst for that. And the sentiment that people don't want to wait to play that because who doesn't know it is what's pulling it forward. So we still have April 2nd to contend with. I think the rally post April 2nd will be muted and you'll see it now in advance of that. You're also in an all clear period, the exception of PC on Friday. But nobody's going to be surprised if that says, okay, the Fed's still on hold, so what can get in the way? Well, obviously more news flow, but any headline, any time.
- [04:20]
Scott Wapner
I mean that.
- [04:21]
Joe Terranova
Exactly.
- [04:21]
Scott Wapner
Therein lies the issue, Right?
- [04:23]
Joe Terranova
Yeah.
- [04:24]
Scott Wapner
One moment you feel good, the next minute you're thrown off.
- [04:26]
Joe Terranova
Exactly. So I think, you know, look, I still have a lot of cash as we'll talk about. I put some, some of it to work, but we still have earnings and we still have guidance. And to me that's, that's still going to be what could tip the scales here. And tariffs aren't going away. We've already started that game. And the others, meaning the other countries aren't going to Back off as easily. So look, it's still a choppy market. You can trade it, you can make money in it. Obviously today is a great day. I'm missing out on part of it. And then again, given the beta in my portfolio, like with, with Metta, with Netflix, which is a little absent today, I'm doing okay.
- [05:05]
Scott Wapner
See Brian, I mean therein lies the, the issue with this market is that the president can flip the switch almost any time he wants. He can go hard on tariffs one minute, the next minute he can back off. And thus an investment decision that you made on the go hard for a minute move suddenly doesn't necessarily work out on the pull back. I look at the Nasdaq, it's up sharply today. Metta is the only mega cap up year to date that's having a nice day. Your Tesla is up, last I checked was up 8%, might be more than that, almost 10% as we look right now. And whether tech can stabilize is really, I don't know, you call it the key question in this market if you think the bounce can continue, can tech continue to move higher?
- [05:58]
Jim Laventhal
I think where in tech are we talking about can, can, can continue to move higher? I think you'll definitely get once again the max seven or let's say meta should outperform Amazon. The Apple I think gives you a market perform but we're where you're already seen to. Tom's point of face Ripper is look at Palantir. It got into the 60s in January, it's back at 90. Robinhood was in the 30s, it's almost 50. Tesla was what, just a 230 back up at 270. And so I think that investors need to really understand and you know, Joe's talked a lot about this, the mechanics underneath the market and Scott, right now the CTAs and the hedge funds are incredibly bearish. And I think you want to fade that signal and do the opposite of what they do because once they get done going to the other side once again, they're very mechanical. There's no investor emotion. They will go on the other side. So if there is this rebalance at the end of the month which triggers more buying, I promise you the hedge funds will not be so bearish, will go long. And so I think just the basic mechanics underneath the market can continue to go higher. But I do think these growth year names, the Robinhoods, the Palantirs are going to outperform these trillion dollar companies. Maybe outside of Nvidia, where you see a clear line of sight for revenue and earnings growth. And Nvidia has probably the lowest PEG ratio of the Mag 7. I know it does. And so I think still I would prefer to own these other smaller names that I think have a lot more momentum and growth than just the Mag 7, which to me are obviously much more mature.
- [07:30]
Scott Wapner
It's good points, Jimmy. The pain points of this market. You know the reason why we've been able to bounce. Mega caps have stopped going down and momentum names have stopped going down. The MTM snapped a four week losing streak. Oh, big surprise that the market looks more stable for the very names and the likes of which that Bryn just mentioned. We still have some work to do because the magnificent seven has looked more like the mediocre seven of late. But you do have some stabilizing moves and some big bounces therein.
- [08:01]
Steve Weiss
Yeah, well, but I still think this is a very jittery market so I'm not trusting it. I'm not in Tom Lee's camp. I want to be in the face ripping rally camp. Let me also be clear and I don't want to talk out of both sides of my mouth, but I'm not selling anything. I'm fully invested. So then you get down to what am I fully invested in? I think Bryn gave us some good insight right now. What have I added to recently? Microsoft in video. To me, attractively priced mega cap tech. I'm not jumping into the high momentum names. I'll leave that for the experts on the panel who do that. But I think that you're just one headline away. This is what you were saying a second ago, or at least asking Scott, you know, you're always one headline away from this market turning down and with it the higher beta names will go down. So if I want to be invested and not worry about what the the next headline is, I want to be in the juggernauts that right now to me are really attractively priced Brin mentioned in video. I mean the PEG ratio is around.
- [08:53]
Scott Wapner
0.5 once you buy more. I mean I've got people making.
- [08:56]
Steve Weiss
I did not that long ago. I'm fully invested right now.
- [08:58]
Scott Wapner
I know but your, your whole point of view, you're talking about not being so reactive. You're worried about a headline here and a headline there. But your overall view of the market is we're not going into a recession. This is just a growth scare. So why aren't you investing more on that view?
- [09:14]
Steve Weiss
Because I am really invested in that view. Right. Mean if you look and you do know Obviously, Scott, my portfolio. Intimately. Well, but if you look at the things like the Deltas and the financials of the world, you know, the materials and the energy stock, man, if this thing goes into a recession, I got to make a big, big course adjustment.
- [09:31]
Scott Wapner
Oh, you're leveraged heavily to the economy, man.
- [09:33]
Steve Weiss
Yeah, I mean, it's, it's unequivocally true. So if you're, if you're in my seat, what you're looking for is not do things get better. That's the base case. What you're worried about sitting in my seat is there's all this Doge tariffs, all this sort of, you know, get the animal spirits in the C suites dialing down. That's what worries me. Now, I'll take some comfort when we get earnings, we get some, you know, some insight into how CEOs and CFOs are looking at things. But let's face it, that's three weeks away.
- [09:58]
Scott Wapner
So I gotta know. Well, in other words, what are they going to tell you at this point that you don't already know?
- [10:03]
Steve Weiss
I hear you, Scott. I hear you. Again. Where I am is I'm trying to gauge the negativity, because what we've got here is a bunch of positive indicators. The economy is still growing. Forget the whole gold arbitrage thing, right? The economy is still growing. Unemployment is low. Most importantly, profits are growing. Corporations want to lean into that. That's not the situation in which they start dialing back, firing workers if they started to say, wait a second, profits aren't going to grow the way we thought. That's where you might have to worry about unemployment creeping up. And that's where a guy with a portfolio like mine would have to make a major course adjustment. I'm not there yet. Let me be clear. I'm not.
- [10:39]
Scott Wapner
You are. You are looking at areas differently than Jim. You're not so leveraged towards the outcome of the economy. You bought more. Amazon today, you're looking at a Stock that's down 19% from its high, and you bought more at the open.
- [10:59]
Ben Rizzuto
So I look at everything from the perspective of how is my portfolio allocated, in which direction does it have risk and in which direction does it absorb a lot of risk? Because we're not in the place it should be when the market makes a turn on March 10, I think. Steve, you were on the show with us. We talked about the potential for that week to be the bottoming. And I bought Amazon at 194. The reason being I don't own any of the Mag 7 and the majority of my holdings are in an equally weighted strategy. So I needed to get some exposure there. I added to it again this morning Amazon to me along with Matter that appears to me to be the the company that has the greatest potential to continue delivering that double digit revenue growth and the ability to very similar to what Netflix is doing to expand its live programing in particular in sports. And I think that's what you're going to see. So it's a name that I've looked at over the last six months I wanted to get into and I looked at the portfolio. So okay, I have risk here. If the Mag 7 stabilize and begin to try and take hold of leadership once again I'm going to underperform. Let me grab something here. I view that as the number one Mag seven for me met a close second.
- [12:14]
Scott Wapner
All right, so Weiss Morgan Stanley talks about earnings revisions out of the Mag 7 looking to bottom potentially. So let's just say the worst of the revisions is over and the multiples have come in right across the board. Cantor Fitzgerald today says don't be forced to live in regret. Buy in video. It's our top pick. They say we 100% understand the near term setup and the macro geopolitical risks that are pressuring that stock. But this shortsightedness has resulted in the Name trading at 16 times calendar year 26 earnings power which is too great an opportunity to ignore. We believe when we look back this too will be viewed as one of these keys key inflection points. You must agree because you bought more of it at 117 bucks.
- [13:01]
Joe Terranova
Yeah, actually I went back into it. If you recall on the show I sold it when they're when earnings came out at about the 130, 131 level. So got back into it. Look, the growth is there. Why I sold it was basically everybody loved it, everybody still loves it but now at a lower price. So I'm comfortable there. So it's a trading market now. There are some positions that I don't sell out of that I don't cut back that periodically add to as we go on because when I look at Scott is this is that I love what I own so I buy what I love. I'm not looking to, you know leave monogamy with my portfolio and stretch into other areas. The exception one we'll talk to later which I think could be a long term hold. So yeah there's a lot of bait in it. I like beta because I can manage the risk and I Like these companies because they are insulated from the economy. I take a different view of the direction of the economy than Jim does because I do see the economy weakening. I do see companies laying off people. I know the companies on the private side that we're involved with, we're all laying off people. Despite strong businesses. We're preparing for the future. So look, excesses came there. We saw it before. You know, people hire way too much coming out of COVID I think there's still, they still have their workforce based upon a very robust economy, which I don't see.
- [14:24]
Scott Wapner
Brin, what about this canner note for your Nvidia as well? Is it, is it going to be short sighted to not look at this today and buy it? And will you have regret if you don't?
- [14:38]
Jim Laventhal
I think so. I think if it's in your wheelhouse, I think you're going to see the value guys. I mean, you know, Jim is. Jim, you would say your car be right. You want to buy good companies, make money. We bought more at 1:11. I just think it's right in front of you. It's right there. This is a great company. I have not heard one hyperscaler. Whether you're in the U.S. china, wherever that is, cutting back on the spend and you're going to get more investment. I mean, think about just what Softbank is doing or what they promised to do. This has a long Runway and I don't care if it's popular or not. The company itself is getting stronger and stronger from an earnings. They're competing against themselves, they're coming out with another Blackwell. And so it's like I don't understand how the competitors are keeping up when they're competing and cannibalizing their own products with new products. It's really just ingenious. So I think this is a durable company. It's cheaper than Apple. It's got much higher margins, revenue and earnings growth than one of probably any company of this size. And so I think it's a wonderful time to own this stock. This is when you want to own it, when people are kind of unsure about it. Once they're sure about it, the stock will not be at 122, it'll be at 160.
- [15:47]
Scott Wapner
Yeah, I mean there's been some degree of debate in terms of the competitors. Where are they? Right. First mover advantage for Nvidia doesn't mean at the end of the day they have the whole pie. Right. Others are going to come take a slice. Maybe they'll take half the pie, who knows. AMD is up, as you point out today, rather sharply. Six plus percent move.
- [16:10]
Ben Rizzuto
Yeah, I appreciate you referencing that. If we could get a six month chart on AMD while I'm speaking about it, what we do is we look at momentum. We try and see where you get the most dramatic reversal in a very short period of time. And we've had conversations on the show about AMD looking like a ski slope. We said you could ski down it. I've been hypercritical of it. We sold out of it many quarters ago. But I could tell you that this is one of the more powerful reversals in momentum that I have seen in the last year. It has quickly swung from being dramatically bearish to in the near term being dramatically bullish. Think it's above the 50 day moving averages. I'm speaking right now. So you've got a low risk trade here where you could probably buy it against the upper 90s. And you've got the potential for AMD to run into the 140s.
- [16:58]
Scott Wapner
Let me do this. We'll get back to this in a second because we have other comments. But we're having breaking news right now from the White House. Our Eamon Jabber joins us now with the very latest. What are we learning, Eamon?
- [17:08]
Eamon Jabber
Scott, the Cabinet meeting here is underway as we speak. We do expect that the White House pool will go in there shortly. So we will see some pictures and some sound we will hear from the President here very shortly in this Cabinet meeting. One update that I want to bring you, Scott, to the President's previous tweet on secondary tariffs on Venezuela. This is important and could have enormous potential implications for global trade because a White House official is telling me now that the way the president envisions those 25% tariffs on any country that does business with Venezuela is those 25% tariffs will be in addition to any existing US tariffs that are applied to that country. Why is that important? Well, Sarah Island Eisen smartly brought up the fact earlier today that a big customer of Venezuelan oil is China. We have the United States has now put 20% tariffs on China so far this year. I am told that this means that as of April 2, the President envisions 45% tariffs on China as a result of the 25% from Venezuela. The previous 20%. All of that the president said in his Truth social post earlier today will be papered and lawyered and go into effect on April 2nd. You see there the tweet from the President saying any country that purchases oil and gas from Venezuela will be forced to pay a tariff of 25% to the United States on any trade they do with our country. That obviously includes China. And I'm told that 25% is on top of the existing Trump China tariffs. So potentially huge implications for global trade there. Scott, one caveat, as with everything at this White House, this hasn't been done yet. It is a threat on social media. As of right now, I'm told that there was an executive order contemplated with this. That executive order did not end up happening on these secondary Venezuela tariffs. So maybe there's wiggle room here for this, for this administration. But as of now, I'm told that's what the intent is.
- [19:11]
Scott Wapner
Scott, your point so well made towards the end there, when you underscore the fact that this is just a threat on social media, it's not actually put into practice, which leads me to wonder at some point whether the market just stops paying attention to a comment here or a comment there, like Friday's comment of there will be flexibility which move the market. And now we have this post regarding a threat and then the potential of a 45% tariff on China. I mean, at some point you just have to wait for the actual news.
- [19:47]
Eamon Jabber
Yeah, I mean, but look, markets love to buy the rumor and sell the sell the news.
- [19:51]
Joe Terranova
Right?
- [19:52]
Eamon Jabber
And I think, you know, that applies here. I mean, we don't know whether this will go through. The president is signaling what his intent is and as we know, his intent can shift from moment to moment. But I don't think you can ignore the prospect of a 45% tariff on China. I mean, the effect that that would have on global trade next week is enormous. So how do, how do market participants figure that out? That's why they're paid the big money to make those decisions. But you know, the president is very clearly signaling some intent here from the White House today. And I should also point out our Megan Casella got a statement. I think we have a graphic of it here, a statement from a White House official official on this idea of whether the sectoral tariffs will go into effect at the same time as the reciprocal tariffs. The statement is may happen or may not. No final decisions have been made as far as sectoral being tacked onto reciprocal. So there was this sense over the weekend that, well, maybe they're backing off of sectoral and reciprocal at the same time. That means, you know, auto tariffs and the like wouldn't happen at the same time as the reciprocal on April 2nd. Well, now a White House official is saying it may or may not. So how do you factor that into your calculations? Again, people get paid a lot more money than me to make those decisions.
- [21:04]
Scott Wapner
Like the ones at my desk right now, which is why I'm going to ask them about it. Eamonn, thanks very much for that Same in Javers, north lawn of the White House, good luck. If you are charged with trading a market that gets a headline versus another headline, we said at the very top of the show.
- [21:20]
Joe Terranova
Yeah.
- [21:21]
Scott Wapner
How do you deal with that sort of environment? I don't mean like, you know, literally ignore.
- [21:26]
Joe Terranova
Right.
- [21:27]
Scott Wapner
But at some point, the market's just going to grow exhausted with dealing with every single incremental headline. Now, right now, the market's not weakening at all.
- [21:38]
Joe Terranova
Yeah.
- [21:39]
Scott Wapner
In any meaningful way. Off the prospects of what Eamon was talking about.
- [21:44]
Joe Terranova
Right. Because if you look at what Trump's trying to do with this tariff, he's trying to have Venezuela completely put the brakes on sending, you know, he's alleging they're sending gangs, murderers, criminals, spies to the US which frankly, we see that a lot of the gangs that are popping up are Venezuelan. So that's easy for them to rectify Venezuela. So if you take a look at what he's going at and what can be done, this one is something the market should shrug off tariff because of.
- [22:15]
Scott Wapner
The prospect of forget the Venezuela in general. But if you talk about a much higher tariff with China, well, then it's a whole different ballgame.
- [22:24]
Joe Terranova
Well, it is. My point is, I don't think you see that tariff come through because of what's at the root of it. So you almost have to on a case by case basis. Just like when he came out and said 200% tariffs on Europe and Canada because we're there retaliating it. So you knew the 200 were wouldn't stick. However, the broader tariffs, you know, those are going to be problematic because a lot will go on. So look, you know, just from a bigger point, I don't disagree with a lot of the policies. I disagree with the way they're being communicated and the way they're being changed back and forth. That's the issue. So I'm.
- [23:03]
Scott Wapner
That that in and of itself has been the root of the uncertainty.
- [23:07]
Ben Rizzuto
It is. I just wonder, and I want everyone's view on this at some point. Does the introduction of where we go here with the tax bill exactly front and center in the headline, does that soften or blunt some of the headlines that we're getting here as it relates.
- [23:23]
Steve Weiss
To tariffs I think he's absolutely softening up the beachheads with all the, all the nasty stuff he's got to do with tariffs and then comes in and kind of makes nice with, with a big tax cut if he can get it through Congress. Congress. That's a big if.
- [23:33]
Ben Rizzuto
You have two competing headlines. You know, we've got tax cuts, we're going to extend them.
- [23:37]
Steve Weiss
But nobody's thinking about it. Nobody's thinking about that in the markets right now. The markets are completely focused on tariffs. You know, hopefully. Hopefully he knows what he's doing and he's going to get the tariffs done and then move to sort of what makes the markets feel good.
- [23:49]
Joe Terranova
Secret about the tax cuts either?
- [23:51]
Steve Weiss
Yeah, no, it's not a secret, Steve, but nobody's focused on.
- [23:53]
Ben Rizzuto
But which one is the market? Pay attention.
- [23:55]
Scott Wapner
Well, we're still mired in a debate over gross scare versus recession and whether this trade war policy will put the economy into a recession or not. Yields have been falling for six straight weeks.
- [24:08]
Ben Rizzuto
Yes.
- [24:08]
Scott Wapner
For the wrong reasons. Okay. Yields aren't moving lower because, you know, bond investors think that the economy is in just terrific shape.
- [24:17]
Ben Rizzuto
Correct.
- [24:19]
Scott Wapner
Which leads me to a move of yours which is buying the TLT I did. And betting that rates are going to continue to fall.
- [24:26]
Ben Rizzuto
I am. Because everything that I'm hearing from this administration is that they're focused on two clear economic outcomes. Lower oil prices and I'm not necessarily sure they're going to be able to be successful there. And lower interest rates. And I think, I don't even think that they're going to be pressuring the Federal Reserve. I just think Treasury Secretary Bessen has spoken to us here on cnbc, to other media outlets about the ten year Treasury.
- [24:52]
Scott Wapner
As a Fortune magazine says, the new saying in the bond market is don't fight Bessens Treasury. Right. Forget about don't fight the Fed. To your point. He has said over and over and over and over we want to get the 10 year yield down, keep it down.
- [25:05]
Ben Rizzuto
And I think that in fact is what's going to happen. I'm not saying so. My position doesn't require a recession and I don't think we're headed to a recession. I do think the next two labor reports are going to look really ugly with all of the losses of, of government jobs. But there's Treasury Secretary Bessen can limit the size of auctions on, on the 10 year. He can talk about loosening regulations in the banking industry and therefore incentivizing demand on the part of banks for those Treasuries. So I just think that the low hanging fruit for me is probably that the next 50 to 75 basis points for here in a 10 year treasury is lower. And I also, I'm pushing, I'm pushing up against what sentiment thinks because sentiment thinks tariffs are inflationary and we're going to get the spike in 10 years.
- [25:56]
Steve Weiss
Well, like, okay, I mean that's a, that's a big move. Maybe you get it, maybe you don't.
- [26:00]
Ben Rizzuto
But no, it's contrarian. It's contrarian for sure.
- [26:02]
Steve Weiss
What I would say to you is just be careful because when we ever get to the debt ceiling, I mean Bessant's a smart man. He's a very smart man. That's why he where he is. And he may just be talking down this mark because he know he's got, he's got to flood the market with, with Treasuries once the debt ceilings lifted.
- [26:16]
Scott Wapner
Brian, give me a real quick wrap because I got to take a break here but I want your perspective.
- [26:21]
Jim Laventhal
Yeah, I would urge all investors to listen to Scott Bessant. Chamath and David interviewed him because about a gross scare. He talked very specifically about the math equation about how, how, how quickly they are or how long it's going to take for them to reduce government spending. And so I think from a trade perspective you could definitely see the long income down as the jobs number and the economy I think will weaken before they strengthen just because of the reduction of federal spending.
- [26:48]
Scott Wapner
Okay, let's take that break. When we come back, I've got a number of moves still in front of me to get to for all of you. Joe's got several. Weiss has some coming up too. We're back after this.
- [27:00]
G
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- [27:33]
Scott Wapner
Years, MultiCare has been in Washington prioritizing long term solutions, partnering with local communities and expanding access to care. Together, we're building a healthier future. Learn more@ multicare.org hello, I'm Ben Rizzuto.
- [27:50]
Ben Rizzuto
Wealth strategist at Janus Henderson Investors. Is a brighter future possible? At Janice Henderson, we think it is. We've worked to help clients achieve superior financial outcomes and fulfill our purpose of investing in a brighter future together. We never forget that this means our thinking and our investments are helping to shape millions of futures. At Janus Henderson, we're committed to helping you invest in a brighter future. To learn more, go to Janashenderson.com.
- [28:32]
Scott Wapner
All right, welcome back. Let's get to these moves. Joe, you have several here.
- [28:35]
Joe Terranova
Yes.
- [28:35]
Scott Wapner
Let's do this. Buy that you have personally. Joe T. Already owns Interactive Brokers. Why did you feel the need to buy it personally as well?
- [28:43]
Ben Rizzuto
Well, I've been waiting to buy this. This is a name that I've owned in the past personally. Josh has done a good job in the last couple of weeks talking about the value of owning exchanges here, and I really view Interactive Brokers as exactly that. It's offering you exposure to trading and equities, commodities, currencies, bonds and crypto. The activity is very fluid right now, very strong volumes. And you had a significant pullback, largely attributable, not really idiosyncratic to Interactive Brokers. But this is a momentum name. This has been one of the better momentum names in the financial sector. And I really believe it's been more about that universal macro environment, the unwind of momentum that's pulled it down.
- [29:23]
Scott Wapner
Okay, well, we'll continue to follow. It's up looks to me about 4%, but we'll watch it. You sold CVS. Why?
- [29:31]
Ben Rizzuto
Sold CVS took about a 6% game. And I was looking here for a reversal, a reversal more in the fundamentals. You know, a lot of times when we make a sale for an existing position, I think people incorrectly interpret that as it's binary. You think it's going lower? No, I'm just looking at the risk to reward profit profile and saying, okay, why did I take the position? I took the position because I wanted to see some fundamental shift. You've got that unfolding. I still think the stock could go a lot higher, but for me, it's time to step the sidelines and take the profit on it and move into another health care name that's more aligned to what I do, which is where could I identify strong technical conditions? I don't think you could really do that. When you pull the lens back on CVS over the last three years or.
- [30:14]
Scott Wapner
Four, five, what is that is McKesson.
- [30:16]
Ben Rizzuto
That's McKesson.
- [30:17]
Scott Wapner
That's a. That's a fresh new buy.
- [30:19]
Ben Rizzuto
That's a fresh new buy. And I think the other thing that's important, Scott, you know this, you've been, you've been doing this momentum stuff with me now for the last several years. You know, we're talking about all these momentum names and the fact that they're stabilizing and potentially recovering. Guess what? In 60 to 90 days, all of the momentum funds, these aren't the momentum names anymore. These names are going to be liquidated and momentum is going to shift elsewhere within the market. I think one of the areas that's going to shift to is health care. McKesson is a fantastic name. It's already guided higher on EPS to 19 to 20%. Oncology, biopharma working really well. And you can see from the chart here it is pressing towards a 52 week high.
- [31:00]
Scott Wapner
Why, speaking of health care, you bought Vertex Pharmaceuticals.
- [31:03]
Joe Terranova
I did, I do. I think I jim into that. It's a new buy, brand new buy. Look, my bet here is that they've, they just launched a non opioid medication for moderate to severe pain. And I'd say that street expectations surprisingly are somewhat muted in the near term on that. They're not expecting any even, you know, meaningful uptick to earnings from that until next year sometime. I think the ramps can be a lot stronger for a seen the first two weeks, but data is kind of limited. So look, I've been, I've been looking at buying this. I've been remiss in not buying sooner because it's been phenomenal. It's not typically what I buy stocks near their high, but I still think there's pretty good upside here.
- [31:47]
Scott Wapner
Okay, you want to comment on that?
- [31:50]
Steve Weiss
The pain medication is going to get picked up more and more and more indications. You're absolutely right. That is the thesis and it comes from a foundation of a cystic fibrosis platform that's the best in the world.
- [32:01]
Scott Wapner
All right, the headlines with Silvana now. Hi, Silvana. Hey, Scott. Good afternoon. President Trump announced today that his former personal lawyer, Alina Haba will be the interim U.S. attorney for New Jersey, effective immediately. Harbor is currently serving as counselor to the president and she'll take over for the current interim U.S. attorney John Giordano, who is being nominated as the ambassador to Namibia. A federal judge is blocking Doge from accessing some private information from the Department of Education, the Office of Personnel Management and the Department of Treasury. The ruling this morning said the Trump administration likely violated the law when they tried to access private data of nearly 2 million people that included Social Security numbers and citizenship status. And the race is on for emergency crews in the Carolinas as they fight a series of wildfires that have been burning through the weekend due to dry conditions and strong, strong winds. In South Carolina, the governor declared an emergency. While in North Carolina, the Forest Service said crews are fighting three wildfires triggering mandatory evacuation in areas still recovering from Hurricane Helene six months ago. Send it back to you, Scott. All right, Silvana. Thank you, Savannah. Now up next, an update to a story we first brought you last month on the first ever private credit etf that product raising some concerns, concerns with regulators. Bob Pisani is standing by with the person who runs that new fund. Do it next.
- [33:31]
G
This episode is brought to you by aarp. Ten years from today, Lisa Schneider will train in her office job to become the leader of a pack of dogs as the owner of her own dog rescue. That is a second act made possible by the reskilling courses Lisa's taking now with AARP to help make sure her income lives as long as she does. And she can finally run with the big dogs and the small dogs who just think they're big dogs. That's why the younger you are, the more you need AARP. Learn more at aarp.org skills hello, I'm.
- [34:04]
Jim Laventhal
Laura Castleton with Janice Henderson Investors. Is a brighter future possible? At Janice Henderson, we think it is. We work to help our clients achieve superior financial outcomes and fulfill our purpose of investing in a brighter future together. We never forget that this means our thinking and our investments are helping to shape millions of futures. At Janice Henderson, we are committed to helping you invest in a brighter future. To learn more, go to janishenderson.com.
- [34:37]
Scott Wapner
Welcome back. Time for ETF Edge. Bob Pizzani has that live in Las Vegas for us at this year's ETF Exchange Conference Conference.
- [34:43]
H
Bob, good to see you there. Scotty. We're here in Las Vegas at the Exchange ETF Conference. This is the largest gathering of ETF professionals, about 2,000 asset managers like BlackRock and Vanguard with investment advisors that buy the ETFs. They're all here to discuss the latest investing trends. Let's talk to one of those industry leaders. Ana Polya is executive vice president and chief business officer for State Street Global Advisors. She runs the Spider business that still includes the largest, largest ETF in the world, Spider S&P 500 ETF. And good to see you. Give us an overview here. What are the two or three main themes that's on everybody's mind here?
- [35:18]
I
Sure. So if you follow, if you follow the flows, you will see the trends and what investors are really worried about. The first one that I would mention is a confidence in the US economy. We have seen that 90% of the assets in the industry to date are US based. So of investors believe in the US industry. And the other thing is volatility. We have seen a very good flows in commodities and gold because these are the products that are helpful for investors to hedge against the volatility risks.
- [35:49]
H
So getting access to private credit is hot. We talked about this a little while ago. You recently launched the SSGA Apollo Public and Private credit etf. Investors are interested in this fund because they want the private credit exposure. And investors sort of anticipated this fund. PR IV is the symbol, would hold between 10 and 35% private equity. But one analyst found that it actually only holds about 5% private credit that's in that fund. Can you tell us how much private credit is in the fund right now? What's the limit that you're working under and do you expect to increase that amount at all?
- [36:27]
I
Right, so that's a really good question, Bob. The limit is as advertised between 5 and 35%. Today the exposure to private credit is in the range of 19% between 19 and 20%. And we expect to change that exposure based on our view about the overall portfolio.
- [36:46]
H
It's. I know the private analysis was 5%. You're saying now there's 19 to 20%.
- [36:51]
I
That's right.
- [36:52]
H
Private credit in the fund right now. And you expect to increase that?
- [36:56]
I
Well, it's up to the portfolio manager. So they are going to have to look at the overall performance of the portfolio. But the range is always going to be between a 5 and 35%.
- [37:05]
H
Is all of the private credit right now sourced through Apollo and are you confident there is sufficient liquidity to meet the demands of the fund?
- [37:14]
I
Not all of it is sourced through Apollo. And yes, we are confidence that whatever exposure to private credit we have in the fund is going to come from sources where there is enough liquidity.
- [37:25]
H
So this etf, it caused a little bit of a controversy because the SEC had questions about this after the fund was launched. That's a little bit unusual. Can you explain what happened here?
- [37:36]
I
So Bob, is not unusual for the FCC to have questions after a registration statement goes effective. We have seen that in other launches. What was a little unusual here was that the comments were public on Edgar. So everybody looked at those comments, at those comments and said, oh, there is something wrong with the funds. But if you, if you look at also the answers to the comments. We were able to sort out those things within 24 hours. And actually there is also correspondence or correspondence on Edgar that shows that the SEC staff did not have any additional comments.
- [38:10]
H
And so just quickly, are you going to remove Apollo from the title? They seem to be interested.
- [38:14]
I
In the end.
- [38:14]
H
You will be.
- [38:15]
I
We have agreed that. We have agreed to do that.
- [38:17]
Scott Wapner
Yes.
- [38:17]
H
And thank you. Always a pleasure to see you. We're going to have a lot more coming up on the hot ETF investing trends on ETF. That's 1:00pm Eastern time. Our guest all star cast here, Travis Spence, the JP Morgan's global head of ETFs Jay Jacobs, US head of thematic and active ETFs at BlackRock, Ben Johnson at Morningstar, Ben Slavin from BNY Mellon. All star cast etfedge.cnbc.com, scott, back to you, Bob.
- [38:43]
Scott Wapner
Good stuff. Thank you very much for that. Bob Pizzani, we have more committee moves ahead. We have our calls of the day as well. Bullish call on a stock Steve Weiss just bought more of Halftime's back after this. All right, calls of the day. We start with Netflix today reiterated overweight 1100 and $50 price target at JP Morgan. They are bullish, supported by a healthy double digit revenue growth, continued operating margin expansion, strong streaming leadership position and the potential to become a global TV leader. Weiss, you already owned it. You bought more.
- [39:33]
Joe Terranova
Yeah, I already owned two large positions, one of one of my top positions and as I sometimes do, I try to take advantage of volatility to add to that position, sort of putting a trading layer on it. And I've done that with this and I added to that again this morning. It was a little askew. It's still not participating in the in the market as as others have and frankly as it has over the last week. So I upsized with that trading position. Look, everything you just said about the company fundamentals is true and they are in fact really making tremendous inroads into ex U.S. regions. So they're, they're unique. They're one of one at this point as others have backed off like prime is backed off, it's spending for content. They will go more sports which is important thing. They just have the best product and its global product.
- [40:25]
Scott Wapner
Jimmy Scott keyed Martin downgraded at B of A. That's not even the big part of the news. The price target. Let's see the stock. The price target cut to 495 from 685. They have dramatically taken down Their expectations, to say the least. You own the stock. And this, of course, is after Boeing was chosen by the White House over Lockheed to build the F47.
- [40:53]
Steve Weiss
And the F47 is the news that is still moving the stock down today. I mean, the downgrades are response to that. I'm, you know, Steve just said something pretty wise here. Sometimes you put a trading layer on top of things. I'm tempted to do that now, and I probably will. I'm not doing it right now. I'm going to let this find its level. But we've got to put the overall F47 news into perspective. It's going to be years and years before that plane flies. It's going to be years and years before that would have hit Lockheed Martin's profitability, or Boeing's profitability, for that matter. In the meantime, you've got the company that is producing the best plane in the air today, the F35. It's the, it's the plane our allies want. There's a lot of headline news about that, about people worried. Is there a kill switch in there? No, there's not a kill switch in there. I mean, come on, we got to trade through the headlines here, which is what we're talking about. I'm using your terminology, Trading layers of standby.
- [41:44]
Scott Wapner
This is not just a headline. This is an actual news. Fundamental news.
- [41:49]
Joe Terranova
Can I ask a fundamental question?
- [41:51]
Steve Weiss
Well, can I. Let me, let me finish.
- [41:52]
Scott Wapner
Let him ask the question, then you guys can figure it out.
- [41:54]
Steve Weiss
Yeah, good.
- [41:55]
Joe Terranova
Let's figure it out. How do you think about this? We're seeing warfare the way it's being fought now. We're seeing using drones and right now using missiles that are $500,000 to $4 million to shoot down one drone and new technology, technology which can shoot down a swarm for a nickel. So we're seeing going away from the metal benders to more on cyber to more on cheaper stuff that every country can build, like Ukraine. So they're a metal bender. So how does that impact?
- [42:22]
Steve Weiss
So the F47 is a manned plane. And that's, that's a pretty big endorsement that we're not moving away from manned.
- [42:28]
Joe Terranova
Airplanes anytime soon completely.
- [42:30]
Steve Weiss
It is a manned airplane. Let's not. So here's the thing. You're putting your finger on what the issue is, because Elon Musk brought this up back in December. Like, why are we building F35s? We're building F35s because they're needed. Drones can't do everything. I mean, you talk to Any air force, they want F35s. That's the end of the story. You got a stock here that's producing the F35s. It's in production. It's not developing, it's not going to sink costs and ramping up factories for this. It's producing it now trading at 16 times earnings, which is very much at the lowest end of the range with a 3% dividend yield. And it's trading cheaply more because of the F35. What you're saying people worry that the F35 is going to be replaced by.
- [43:09]
Joe Terranova
Drones broadly on their metal bender is what they're called. So it's not just the F35, it's not just the new jet. It's cutting back on all the big expenditures in these heavy.
- [43:22]
Steve Weiss
I don't think, here's what I'm trying to say. Let me just be really clear. I don't think budgets around the world are cutting out the F35. You're talking to the headline, that's fine, but the budgets are not actually reflected.
- [43:33]
Scott Wapner
But the biggest budget of all.
- [43:34]
Joe Terranova
I'm not talking about just the F35.
- [43:36]
Scott Wapner
The biggest budget of all in the world is, is just awarded it to somebody else, right?
- [43:42]
Steve Weiss
Yeah, but we're talking about two different things. The F47 is years and years and years away from production. That's not in any near term estimates, earnings estimates.
- [43:50]
Scott Wapner
All right, we'll take a break. Santos Toli, he's next with his midday word. We are back. Senior markets commentator Mike Santoli has sat down at our desk for his midday word. Peak uncertainty. Those are the two words you're thinking about?
- [44:09]
Joe Terranova
Yes.
- [44:09]
Steve Weiss
So going into the weekend, I thought.
- [44:10]
Ben Rizzuto
That was the big question is finally everyone knows you're supposed to buy the maximum uncertainty moment and are we near there or at least peak acknowledged uncertainty about the things we're in suspense over.
- [44:21]
Steve Weiss
And so today's action suggests that, you.
- [44:24]
Ben Rizzuto
Know, it's plausible that that's where we are. Still a lot of kind of spring loaded mechanical stuff is working in the market's favor today.
- [44:33]
Steve Weiss
And you saw the momentum in high.
- [44:34]
Ben Rizzuto
Beta up twice what the market was at the start, maybe a little less.
- [44:37]
Steve Weiss
Than that right now.
- [44:39]
Ben Rizzuto
It just suggests that, you know, the ball being held underwater, it's springing higher, you're above the 2, 200 day average in the S and P. So things are progressing. I don't think all the questions have been answered in terms of economic knock on effects, but expressions of flexibility, you know, if at 5,500 in the S and P. You were basically assuming or pricing in very aggressive across the board, max tariffs. Now you can say something different and.
- [45:03]
Steve Weiss
You have some wiggle room.
- [45:05]
Scott Wapner
For now.
- [45:06]
Joe Terranova
For now.
- [45:06]
Ben Rizzuto
That's exactly. And everything is reversible and contingent.
- [45:09]
Scott Wapner
Yeah. All right. We're learning that, Mike. Thanks. I'll see you on closing bell. Mike's in Tolle. Finals are next. I'll see you on closing bell, 3:00 Eastern with Dan Greenhouse, Mohamed El Erian, Mike Mayo and Shannon Sokosha. And we'll have an interesting market as we always do during that final stretch. Bryn, what is your final trade today?
- [45:34]
Jim Laventhal
Dell. Michael Dell. Thanks. Stock is cheap. $10 billion buyback, raise their dividend. Key company in the data center tech stack.
- [45:41]
Scott Wapner
Okay. That's been in the momentum basket, as has Vertif Weiss.
- [45:44]
Joe Terranova
Yes, I bought it back last week and the future still very bright. And the valuation got reasonable. I also had to get on Brent speed dial because I missed Hood. Wish you would have told me about that. I paid up for Nvidia, so I got to work that out.
- [45:59]
Scott Wapner
All right. We do have a nice bounce in a lot of those momentum names. Vertif included, Farmer Jim.
- [46:04]
Steve Weiss
So I said earlier, I think it's still going to be a choppy market. I want to make a recommendation that I think I'll be happy with no matter what the markets do. And that's Alphabet. I think it's easy at this valuation.
- [46:14]
Scott Wapner
All right, thank you very much, Joe.
- [46:16]
Ben Rizzuto
T. Well, we talked about defense before and I think it's important to talk about cybersecurity. One of the best names in the world in that regard. Israeli based Checkpoint Software.
- [46:24]
Scott Wapner
Thank you very much. I will see you on the closing bell. The excellent exchange begins right now. You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern only on CNBC.
- [46:41]
G
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 andor 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 this episode is brought to you by AARP. Ten years from today, Lisa Schneider will train in her office job to become the leader of a pack of dogs as the owner of her own dog rescue. That is a second act made possible by the reskilling courses Lisa's taking now with AARP to help make sure her income lives as long as she does, and she can finally run with the big dogs and the small dogs who just think they're big dogs. That's why the younger you are, the more you need AARP. Learn more at aarp.org skills.