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Halftime Report
Can the Market’s Momentum Continue 02/13/25
00:44:18
Scott Wapner and the Investment Committee discuss tariffs, inflation and Meta on a hot streak. Plus, the Committee debate the latest Calls of the Day. And later, Josh Brown reveals one chart you should be watching.
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- [00:00]
AT&T Business Narrator
And now a next level moment from ATT Business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for International Sleep day. You've got AT and T5G so you're fully confident, but the vendor isn't responding and International Sleep Day is tomorrow. Luckily, AT&T 5G lets you deal with any issues with ease so the pillows will get delivered and everyone can sleep soundly, especially you. ATT 5G requires a compatible plan and device coverage not available everywhere. Learn more@att.com 5G Network Are you still quoting 30 year old movies? Have you said cool beans in the past 90 days? Do you think Discover isn't widely accepted? If this sounds like you, you're stuck in the past. Discover is accepted at 99% of places that take credit cards nationwide and every time you make a purchase with your card, you automatically earn cash back. Welcome to the Now It Pays to Discover. Learn more@discover.com credit card based on the February 2024 Nelson Report.
- [00:58]
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 IQ thanks so much. Welcome to the Halftime Report. I'm Scott Wapner. Front and center this hour, tariffs, inflation streaking, meta. We are trading all of it with the investment committee and so much more. We do have some new moves to debate as well. Joining me for the hour today right here, post nine Josh Brown, Liz Young, Thomas, Bill Barrus and Kevin Simpson. We will check the markets. We do have a lot to get through today. We're going to get reciprocal tariffs, we assume at 1:00. As the President has said, you got the PPI hotter today, just like the CPI. We have the Meta streak, which we'll talk about. But Liz, for the most part, this is a resilient market. It's looking, it's looking through tariffs, it's looking through inflation, it's looking through almost everything.
- [01:52]
Liz Young
It is. And it shrugged off the hot inflation report from yesterday, despite the fact that in 2025 we've really transferred our attention from jobs to infl inflation. Got a hot print, got kind of a hot PPI today and the market continues to be resilient through it. So I think a lot of that is due to, number one, the fact that we still have supportive economic fundamentals. You've got growth that's strong, a consumer that continues to spend. We've got an earnings season that's come in above expectations. Now, remembering that a lot of this, including that inflation data is still from the prior administration and from last year. So we have to get through the rest of 2025 and post inauguration. There continues to be volatility in certain areas, but there also continues to be strength in new areas. Not the same ones as 2024, not the same ones as 2023. And I think that's what investors have to continue to pay attention to.
- [02:42]
Scott Wapner
What do you want to riff on today? What's on your mind about this market?
- [02:45]
Josh Brown
The Meta thing is wild going there yet?
- [02:47]
Scott Wapner
Yeah, we go there right now if you want.
- [02:49]
Josh Brown
All right. The last streak that we've seen where matter just ripped and ripped and ripped and I remember it actually was 2015. That's 10 years ago. It was 11 days. Streaks for the rest of the Mag 7 don't even come close to what Meta just did. We went back and looked at the other Mag 7 names just to get a sense of like, is this a thing that really happens? Tesla 13 days. That was a big one. Apple 12, Alphabet 10, Nvidia, Microsoft, Amazon also 10. Meta has just gone from 612 to 723, which is an 18% run. That's 280 billion in new market cap. It's way overboard here. So a pullback obviously makes sense. And 81 RSI is fairly rare for any stock, especially one as big as this. And if you look at the median return for AN S&P 500 stock since this streak started for Meta, it's effectively 0%. So what's happening here? Well, you have this really lackluster response to all of the other max 7 names after reporting their earnings to varying degrees. Met is the only good one. And you still have this phenomenon of managers terrified to miss out on the mega cap of the year or be underweight. It becomes really hard to fight when you're on defense and you get a quarter or two into the year and you were underweight, the darling. So I think it's a lot of active manager crowding. And the takeaway for me for, for regular investors, let's say you don't own matter. You wish you all matter. You think you're too underweight. Whatever the case may be, there's probably going to be a moment to buy it. I don't think today on the 19th consecutive potentially up day is that day. Let it cool off. And that would be a better entry.
- [04:31]
Scott Wapner
If bill it cools off. I mean, this streak has been just miraculous to watch this unfold Day after day after day.
- [04:39]
Bill Baruch
Yeah. I'm not sitting here counting my stars, thinking we've got another 5, 10, 19 days in a row. It is our largest position or concentrated portfolio. It's been since quarter four. It's one of our top five names, our main portfolios, but they're monetizing. We've been talking about this going back to last, last summer. They are one of the first companies to really see the revenues come in and forecast it as well. We talk about data. They have the data set. They're in a unique position here to really have that data set. And from an advertising standpoint, companies need to be advertising on there and they're going to be continuing to drive that revenue. Now, Capex, it's continued to increase the market, seeing through that. But we have a new Zuckerberg here. He is making the company more efficient. He's bringing costs down and the wasteful cost down. This company is well positioned. Again, I'm not thinking to run higher from here. Consolidate would make sense, but I love the name and I think we'll see it higher.
- [05:27]
Scott Wapner
You have it too, right?
- [05:28]
Kevin Simpson
This is one of the few names, Scott, that we have, both in our dividend strategy and in our growth strategy. I like what Bill said about the advertising. That was one of the things that we were really high on. Also the hardware. I mean, this is a company that can compete with Apple. The glasses, the Oculus. These are real products. They work incredibly well. I'm a user. I think they're fantastic. The other thing about Metta, with respect to Josh's point, I would expect a lot of managers, ourselves included, to be trimming it because it's becoming such a big position so you'll get a chance to buy it. Things don't go straight up.
- [05:58]
Scott Wapner
It's like the ultimate momentum trade that we've seen in a year where momentum as a factor in a strategy has just done incredibly well. There are so many other names to mention that are part of the momentum run. Netflix and all of this from the date that Metta started this, January 16th. Netflix up 21%. Palantir up 72. You read it, up 27. Robinhood up 23. CrowdStrike up 20. I mean, you can hit if you want. Kev Robinhood, which is surging today, certainly one of the better stocks to look at. You own that name. But the momentum behind this has been extraordinary.
- [06:39]
Kevin Simpson
Well, they crushed it last night with earnings. I mean, there was no better report you could have possibly anticipated. And to their credit, I mean, this is a Stock that had crypto trading double over the past quarter. Also, it's not just like a little online trades for kids. It's not a gambling proxy. They're getting into wealth management. They bought trade pmr. When the money changes hands from one generation to the other, they're positioned to take advantage of it. We think this stock can go higher. And Scott, we just bought it in December. We bought it in December 9th at 40. And we still think this has got a lot of.
- [07:09]
Josh Brown
Can we do a. Can, can we do a chart of Interactive Brokers Group? In this same conversation, the entire capital market segment of the XLF looks maybe not as good as Robinhood, but some of them look better. IBKR is up 100 points in the last five months. It's not that the business isn't good, I get it. But like, like there's something huge happening here, like an earthquake in these capital market stocks because of how well stocks have done. Not just the United States, fresh highs in Europe, stocks around the world, but also the credit markets, but also the bond markets, but also potentially seeing new issues come to market finally in size. And this entire group has been investable, tradable, however you want it to be involved. There are so many names on my best stocks in the market list which Robinhood's been on for a while. Interactive Brokers has been on. There are like I think 10 others, just capital markets alone. And when they back off, you only get like a day or two to, to buy those dips, you know, Robinhood.
- [08:11]
Bill Baruch
And IBKR have in common. They're both attacking the RIA space. Yeah, they both have gone after it over the last six months.
- [08:17]
Josh Brown
Custodian space.
- [08:18]
Scott Wapner
Yes.
- [08:18]
Bill Baruch
Custodian space. Yes.
- [08:19]
Josh Brown
Don't attack me.
- [08:20]
Scott Wapner
Yes.
- [08:20]
Bill Baruch
No.
- [08:25]
Scott Wapner
Liz, you know, what do you make as an observer of, of the momentum trade in and of itself? The factors been working so well. I mentioned those names, but you could look at the mtm, obviously, you know, the Jyoti takes on momentum as well.
- [08:41]
Liz Young
Yeah, I mean, so if we go back even to the beginning of the conversation, just the resiliency of this market, a lot of it is momentum based and you've got buyers that are still coming in. No matter what the fear is that gets inserted into the market, whether it's something macro or it's a tariff headline or it's geopolitical risk or even earnings that come in poorly or guidance that comes in poorly, we still have buying appetite in this market. And I think a big part of it too is that people have started to pay attention to where they want to rotate. So we started to get much more worried about valuations towards the end of last year. But nobody wanted to get out of equities. So staying in equities, looking at those cyclical trades and even staying in places like tech, but looking at different opportunities within tech. I continue to like software. Software has done really well in that space compared to semis and you're finding those types of opportunities in the cyclical sectors as well.
- [09:32]
Scott Wapner
I said, you know some of these cyber names when you're, when you're talking about software. But let's hit Reddit if we could real quick because Reddit is up 27% since the beginning of this meta run. It's obviously down today as you see see on the user growth numbers. Yet a number of price target raises nonetheless today. What's your take, Josh, on, on what they just reported and this move in the stock.
- [09:58]
Josh Brown
It's another outstanding quarter. Last night it looked like it was going to be down 12, 13% but that's because a lot of the trading that you see is algorithms and software and they're not picking up on the nuance of what the company actually said. Let's do the numbers and then we'll do the story. Revenue was 428 versus expected 406. That's a really nice blowout. EBITDA 53 versus 34 expected. That's a legit blowout on cash flow. Earnings per share 85 versus 70. And then they said 133% for the guide for earnings per share growth this year and 104% next year. Why not? So this is a name that is now 12% off its 52 week high and they came in and bought it. They bought the dip. So there was a nastier overnight dip. And I think I saw this thing flat on day. Why? The only negative, potentially negative thing in the report was a slight user growth miss. But they explained it. There was a short term change in the Google search algorithm that led to them getting less traffic. They adjusted to it and they said by the close of the quarter they were back on track with their growth plans for for daily average. So if that's why you sold the stock, because you had an algorithm doing your trades for you and you didn't wait for the explanation. Congratulations on blowing this thing out at 185 last night. Now it's 202 and I think the story is intact.
- [11:19]
Scott Wapner
You know, Cyber, as we mentioned, has been a rip, Kev. Intraday highs for the bug etf you could go down the list of a number of names I told you about CrowdStrike, but many of the others have participated as well, including Palo Alto, which has earnings after the bell. The Stock is up 18% in a month. And you just bought it.
- [11:42]
Kevin Simpson
Yeah. With the growth strategy, we have the ability to get into some of these names and you could almost take your pick. Josh is going to get into them later. But this is a space because of what's happening with AI and the open source model, you're going to need more and more cybersecurity. This is a company that's been crushing it year over year, quarter over quarter. The recurring revenues we're going to look for tonight in the call, but we expect them to be top line, bottom line, and we can talk about it tomorrow. But we really like this space. We just bought it at 190, 180. I mean, it just keeps going up.
- [12:09]
Scott Wapner
Yeah. But speaking of cyber, you do have what is the biggest IPO since aam. It's up at the Nasdaq, it's Sail Point. So we'll keep our eyes on that as well. It's Thoma Bravo backed cybersecurity firm, was taken private. Now it's going back public once again. Founded back in 05, so we'll keep watching that. But the cyber trade has been unbelievable, especially crowd, which is yours.
- [12:31]
Josh Brown
Yeah, I think we're still in the moment where the rising tide lifts all ships and you can make money with pretty much any of these stocks with a, with one or two glaring exceptions. They've all been winners. I think there is no AI without securing the data, the network connections, the software, etc. So this is part of that, but it's also something part of something that's more secular, which is just more and more activity around the world moving digitally and all of the inherent risks that come along with that. So I think it's. Look, I've been saying for four years on CrowdStrike, this is a secular trend. Nothing's going to stop the amount of spending here. There are literally no board meetings where somebody proposes cutting the cybersecurity budget. You can cut marketing, you can cut human resources, you can cut snacks and the supply closet. But this is a, I think permanent bull market. So then the question becomes, well, for how much longer does the rising tide lift all boats? When does this cyber thing start to consolidate around a couple of winners? Which ultimately is what always happens? I don't know. But I think that CrowdStrike will be a top three player almost regardless. And so that's where I want to stay. It doesn't mean I don't like the other names. It just means I'm focused on the opportunity between now and 2030 and I want to be in the blue chip.
- [13:51]
Scott Wapner
Liz, I mean, is this what you're looking at when you're singling out something like software, like this cohort within that group?
- [13:57]
Liz Young
My software play is really a three pronged thing, but one of them is cyber. And not to toot my own horn, but on 1219 I was here use cyber as my final trade. I did that because when you look at just the textbook space, first of all, I think investors continue to have appetite for tech. That's not going anywhere. But we're coming off two years of really strong semiconductor performance. You have to find other opportunities and cybersecurity. To Josh's point, it's just a long term play. The demand for it isn't going anywhere and it had been trailing some of the other parts of the index and other parts of the sector. So when you look at how Cyber's done even since that day, it's outperformed the tech sector by 950 basis points. It's outperformed semiconductors by 700 basis points. It's been a great place to be. Of course, when it's gone that strong, you probably give a little back in the near term. But I still think over the long term you hold it and even add.
- [14:46]
Scott Wapner
On fort net 16% in a month. Crowds almost 30. Zscaler is up substantially. Palo Alto has been a nice winner too.
- [14:56]
Bill Baruch
The reliance on data. Second, what Josh said creates this demand for cyber. You can't ignore it now. Crowdstrike, we added that last summer in the midst, albeit a little early when it was going down. We haven't cut it since. I really like this name. The consolidation on a technical basis that it had from November to January, it's broken out post deep seek is some resistance at 450, but I honestly believe as earnings grow this is a $600 stock CrowdStrike.
- [15:21]
Scott Wapner
So we'll watch Metta, which as we said is down just a little bit now, but it is going further for 19 in a row, which no NASDAQ 100 name has gotten even close to that. In fact, if you look at performance wise relative to Metta, everything else is fairly disappointing. Amazon's up 4 year to date. Elsewhere we're read across the board, including Apple, which has had a nice little move of late. And then they do have that big announcement about the partnership on AI with Alibaba, which the chairman Joe Tsai has confirmed. I spoke with Morgan Stanley analyst Eric Woodring yesterday who talked about that relationship, the prospects that it could be a huge step towards Apple fixing some of those China issues.
- [16:06]
Josh Brown
Listen, China is a market that is very technology forward. They are looking and searching for AI features from Apple. Apple has not delivered them to date. In a partnership with Alibaba, the largest E commerce provider in China, could be monumental in at least shifting that China narrative.
- [16:25]
Scott Wapner
Well, Steve Kobach joins us now, our technology reporter. I mean, we talked not even a week ago, Steve, about what we described as a headache, a migraine that Apple has had as it relates to China. But you heard Woodring could be monumental is how he describes this partnership.
- [16:42]
Steve Kobach
Yeah, Scott, that was a great setup for Merrick there. This is just an extremely high stakes moment coming into this potential AI launch in China. So let me go over what happened here overnight, Josiah. He's the chairman of Alibaba, he made some comments at a conference in Dubai confirming those reports we got on Monday that Alibaba is in fact going to be the Chinese partner for Apple Intelligence in China. That means when you use Apple Intelligence here in the US you have chat CBT integrated with Siri. Now it looks like Alibaba's chat bot is going to take over that in China. And by the way, this is all coming as these, these headwinds in China are just coming to a head. We have increased competition from Huawei, which by the way, to Eric's point, has AI features that Chinese customers seem to love. Apple Intelligence still has not launched there. And then you have things like manufacturing and the tariff issue going on. All of that paints a really tough picture for Apple and China, which by the way, sales were down 11% in the December quarter compared to the prior year. Let me give you a little bit of tea leave reading here though, Scott, to when we might expect Apple Intelligence to finally debut in China. In March, Apple sent developers a note saying they're going to have a session for them to teach them how to integrate their apps better with Apple Intelligence. And then in April, Tim Cook told us two weeks ago that the Chinese language is going to launch on Apple Intelligence, not necessarily in China itself, but that is a big step forward. So at the very earliest, we're expecting to see this happen in April, which won't be reflected in Apple's results until the June quarter at the very earliest. And on top of this, I know you talked to Eric Widgering about this yesterday as well. Those subsidies are a really important thing to watch in China. Tim Cook hinted there might be some movement there here in the March quarter. That means phones that cost under $800 US or so, they're going to be subject to getting those rebates back to spur some more buying there. And just these reports since Monday we've seen Apple and Alibaba up quite significantly. Alibaba is up about 14% now week to date. Apple up better than 5%. And I'll give you at Apple style, one more thing, Scott, not necessarily due to China, but Tim Cook just tweeted a couple an hour or so ago next week on the 19th, they're going to be announcing a new product. We think this is going to be the iPhone SE. That's that entry level model of the iPhone. They take old designs, put some new chips in there and sell it for a couple hundred bucks off. Scott.
- [19:10]
Scott Wapner
All right, good stuff. Good wrap up of everything that we need to know. Steve Kobach, thank you very much for that. You bought more recently.
- [19:16]
Steve Kobach
Yeah.
- [19:17]
Bill Baruch
And we're seeing the fruits of it now. I mean now that tested in the 200 day moving average. But here's the thing. This news you're talking about an established player in China, the fears of the growth on around the iPhone 16. I think this really is a great tailwind around the company. And as I've said here the last couple of months, when you want to be buying Apple, when it falls, it falls out of love. And now we're going to start to see it turn. I think it's going to be a leader in the next few months.
- [19:40]
Scott Wapner
Where does, you know, where does all this leave us? As we, you know, we talked about the resiliency of the market. We've talked about momentum and streaking matter. If you look where you know, retail investors are sort of anchored right now, they're still buyers of stocks. According to JP Morgan, their retail radar, as they call IT net, bought $4.1 billion and over half of that went to the tech sector, which is interesting. Nvidia continuing to lead the inflows a couple weeks away from earnings when we really get the report. And I thought there was an interesting note today from Tony Pascarello. I've quoted him on a number of occasions. He put out a note just before we came on the air about the resiliency of the market, sort of where we are and how you should be thinking about it and maybe the kind of trades that you should be making the big picture. He says, quote, if I were an optimist I'd repeat a line from the past. Over the long haul, tensions in the US equity market usually resolve in favor of the bulls. If I were to be a bit more circumspect, particularly as that flow impulse begins to fade, I'd again call your attention to high quality liquid hedges on the S and P. Gives an example March expiration put spreads where I come out. He sums it up long the market with tail protection. What do you think about that?
- [21:00]
Bill Baruch
I think we're in a he. I think he's right. You know we're in a unique position here right now. The market has seen through the inflation data. There's some wonkiness that maybe came seasonally, some, some geographically wonkiness as well. Transportation was strong, food was strong. I think we move past it, the market's seeing through it. And you take a look at monetary policy and fiscal policy right now. I think there's, there's an understanding right now that, that the Fed is not going to hike rates. There's no fear of hiking rates, nor does the market need to seek rate cuts. And then let's call what it is the government, the White House right now is coming in and creating austerity. They're going to lower the spending and they're going to focus on the fiscal policy. They're focused on the 10 year yield and bringing the 10 year yield down. As we work through this some of the small caps may struggle but the big names, the tech names that have performed in higher rate environment over the last year and a half they'll continue to perform form. I'm pretty bullish right here. I think we're in a unique situation where we saw the market kind of whipsaw early yesterday. No one, no one expected a hot inflation data out of the Bloomberg analysts. 0 out of 5073 expected headline inflation number at 5 10. So I think right here, you know we saw that whipsaw positioning mattered and everybody chased back into the market. I think we're setting up to see new record highs.
- [22:10]
Scott Wapner
What do you see about the Pascarello no long market. Get some hedge, some protection along the way.
- [22:17]
Josh Brown
Specifically he's not talking about regular hedge, he's talking about tail risk hedge. He's talking about like very far out of the money like put contracts in case something really blows up and you get like a repeat of the Japanese ripple from the currency. Listen, I think he's writing for hedge funds for the people. He is, he is right for my people. Look at me. The best hedge is don't Invest more than you can afford to lose due to a temporary drawdown in the stock market. Any amount that you can't afford to lose that stays in either short term high quality treasury bonds or in cash money market funds right now, which, by the way, have a positive rate of return over inflation. That's your hedge. So it's not about, let me invest the maximum and then figure out all these like really ornate ways to protect. Protect it. Don't invest too much, invest the right amount.
- [23:09]
Scott Wapner
Also know when to sort of pull the rip cord on what hasn't been working. Like Trade Desk example, what is which is getting destroyed today on earnings. It's the worst day ever for this stock. Their revenue missed. Their guidance for Q1 was weak as well. So you sold it?
- [23:28]
Josh Brown
Yeah, I mean, this is a company that came in missed on revenue earnings per share as well. And the guidance here's a problem. You're buying a momentum name and you've got a huge rally in the stock. So everyone's already up in the name and then they come in and they have nothing positive to say. There's no valuation support. It was already a nosebleed high momentum name with a crazy valuation. So when they miss, you can't wait. You have to come out of the name and reassess. You might get into it, you might not. But I think you need like one or two quarters of this to be in the penalty box. So I wrote it the whole way up. I had a nice cushion going into the number as soon as I saw a disappointment. You know, this name is coming off the list and you know it's getting stopped out if you wait till the next morning either way. So this was a really easy sale to make. And I don't think I revisit it anytime soon. They're gonna have to pay their dues in the penalty box and they're gonna have to get a couple of good quarters underneath them before anybody wants to trust the story going forward.
- [24:30]
Scott Wapner
All right, good update for us there. We're going to take a quick break. When we come back, we'll do our call of the day. It's a price hike and a big one for one of Josh's stocks and it's ahead of earnings next week. We'll debate that. We'll trade many more stocks still to come after this break.
- [24:48]
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Visit assuredguaranty.com assured guaranty a stronger bond and now a next level moment from AT&T business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for International Sleep day. You've got AT and T5G so you're fully confident, but the vendor isn't responding and International Sleep Day is tomorrow. Luckily, AT&T 5G lets you deal with any issues with ease so the pillows will get delivered and everyone can sleep soundly, especially you. ATT 5G requires a compatible plan and device coverage not available everywhere. Learn more@att.com 5G Network Are you still quoting 30 year old movies? Have you said cool beans in the past 90 days? Do you think Discover isn't widely accepted? If this sounds like you, you're stuck in the past. Discover is accepted at 99% of places that take credit cards nationwide and every time you make a purchase with your card you automatically earn cash back. Welcome to the Now It Pays to Discover. Learn more at discover.com credit card based on the February 2024 Nelson Report.
- [26:17]
Scott Wapner
All right, welcome back. Take a look at shares of Live Nation today. Goldman's trying to get ahead of an earnings report that is one week from today. Quote we expect Live Nation to report in line to better than expected results. They raised the price target today to 166 from 148. What do you think?
- [26:35]
Josh Brown
Look, this is an extremely special asset. There is nothing else in the markets that trades currently where you can invest directly into one of the most important sectors of leisure, which is entertainment. Live Nation has built an incredible franchise. In many ways it is one of the finest entertainment companies in the world and Mike Rapinoe has done an outstanding job navigating. Think about all the cross currents you have. The artists, they want to price their tickets at a certain amount but they don't necessarily want to be the reason why. The price is what it is. Then you've got the technology side. Taylor Swift can crash the site at any time. You got to keep the scalpers out. Then you've got the venues. There is safety concern. This is such a difficult business to run and look at what Rapinoe has built. So I think they deserve the higher price target. I remain long into the print and I wish them the best on their earnings.
- [27:31]
Scott Wapner
Have JP Morgan likes Lilly. They call it their top pick. Quote Continue to see Room for further upside. What do you think?
- [27:37]
Kevin Simpson
I mean, we were surprised at how well the earnings were on the last quarter. Revenues were up 45% with. We didn't see that coming. And I think a lot of it has to do with other applications. You know, it's no secret that the GLP drugs are great for weight loss, but now they're talking about healthy heart. If you want to reduce your drinking, you know, who knows what the next application will be? But there's a long Runway and we agree with the call.
- [27:58]
Scott Wapner
Take a look at shares of letter T at and T outperform at BNP bill. It's a new 52 week high today, by the way. Price target to 2850, up from 22. So it's right in between the two targets that we're talking about. You, you own it?
- [28:15]
Bill Baruch
Yeah, we've owned it since we launched more than four years ago and the name has really done really well. You know, it had some fears back in late 22. We doubled down then and we haven't even really trimmed it much since then. Broadband data speeds, I mean, there could be higher and higher demand. I'm sitting on my AT&T hotspot right now. I mean, I think as the, as the evolution goes with technology and the need for data, need for speed and connectivity all the time, this is a name. That's right.
- [28:41]
Josh Brown
Cable, which is really important. This one's on my list. I've been watching and I missed the whole run. Getting out of cable, getting out of entertainment entirely. Focusing on business customers, focusing on broadband, focusing on wireless and reducing debt. And I wish Verizon would act as well as this one acts technically. And maybe that one I won't miss. But for right now, this one and T Mobile both look great.
- [29:04]
Scott Wapner
Speaking of missing the whole run, Kev, Adobe. When you talk about AI stocks and software companies that play within AI, which this says it does, the stock performance is missed out relative to almost everything else. Comparable. It was reiterated today, outperform at Mizuho. And you have the stock, you don't even like it.
- [29:25]
Kevin Simpson
Yeah, lukewarm at best. You know, it befuddles me because all of us use Adobe. I mean, I use it all the time. But Firefly and the new application for videos, I'm not really seeing how I can bring that into my world. But we're going to continue to hang in here with this name if they can turn it around because of the user base. I mean, I use Adobe all the time, but I'm not using Adobe AI. If I can just get over that hurdle and others can. We think that the user base and the application and the way that we're so embedded in the system has to turn the company around. If not, we'll sell the stock. But I'm not willing to give up on it just yet.
- [30:01]
Scott Wapner
Okay, you let us know. Astero Labs, Equal Weight, Morgan Stanley today. They did have earnings earlier in the week. You own the stock?
- [30:07]
Bill Baruch
Yeah. The earnings were a high bar and gross margins were solid. Revenue growth was really solid. Now, this is more of a narrative. I mean, the relationship it has with Nvidia, Amazon, the connectivity of the GPU, space, CPUs into GPUs as well. This is going to be a derivative of Nvidia. And the higher demand of Blackwell is going to feed into revenues for a lab. We really like to say that we added to it on the. On the post, deep seq during that week.
- [30:35]
Scott Wapner
Wait, you got to do a bunch of things on that. What? Apple, Nvidia, Broadcom, and Broadcom. And this. All right. Good stuff. Thanks for that, guys. Contessa Brewer has the headlines for us. Hi, Contessa.
- [30:44]
Contessa Brewer
Hi there, Scott. The full Senate will vote to decide if Cash Patel should be confirmed to lead the FBI. The Senate Judiciary Committee voted along party lines earlier this morning to advance President Trump's pick. Patel has vowed to fire the agency's leaders and punish what he calls a deep state conspiracy against the president. The US Military is ramping up surveillance of Mexican cartels in order to collect intelligence to counter their activities. The head of the US Northern Command said the military is using its airborne assets to gather the information and added it would need the Coast Guard's help for a larger maritime presence. And the New York jets are wishing Aaron Rodgers sayonara. The team announced in the last hour it will move on without the future hall of Fame quarterback next season. Rogers was traded from the packers in 2023 in an effort to help the jets, but then he missed the first season with an Achilles tear, and the team went 512 this season. That's not a great track record. Rodgers has one year left on his contract with the Jets. But, Scott, I mean, as a Packers fan, I feel. I feel happy to comment. He should have known from Brett Favre that this was not the path. That's it. The end of sports commentary for me.
- [31:53]
Scott Wapner
Okay. All right, noted. I'm sure he noted that, too. We'll see where he lands. Contested. Thank you, Contested Brewer. Up next, we have today's top movers, including two committee names hitting fresh, all time highs. We'll tell you what they are. We'll trade them much more coming up next.
- [32:09]
Liz Young
Our state has changed a lot in.
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AT&T Business Narrator
The last 140 years.
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Liz Young
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With local communities to grow programs and.
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Liz Young
Services and expanding healthcare access to those.
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AT&T Business Narrator
Who need it most.
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Liz Young
Together, we're building a healthier future.
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AT&T Business Narrator
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- [33:17]
Scott Wapner
Foreign welcome back. Let's talk about that chart right there. That is Moody's. It's a new record high today. It comes on the back of earnings and the guidance that they gave. If you do recall, it was a week ago that Josh pitched this stock to our pal Al Michaels live on this program. It was just under 500 when you did that. Looking at it here, it's at 520 18. What's your advice for our viewers if they followed you and Mr. Michaels?
- [33:48]
Josh Brown
Yeah, so, so the name rallied into the print because we got S and P global earnings and guidance the prior day, spg, which is another name we talked about. And Moody's came in and said, look, 9% growth this year, but 13% next year. They see an acceleration in their two core businesses, one of which is investor services, which most, most people associate with Moody's. This is rating bonds and research, etc. But then on the analytics side as well, the data side as well. So it's a strong story, getting stronger. And I think what you want to do here, if you're a trader, you want to play with the house's money. Use that prior resistance of 500 as a pivot point. A close below, the story gets a little bit messier technically. So maybe that's where you want to take the position down or come out of it entirely. But until then, again, it's the house's money. As an investor, I think you want to use the rising 100 day moving average. That's your trailing stop. It's about 480 right now. Check in every Friday around the close. If she closes Above. We're still intact. We want to stay long.
- [34:54]
Scott Wapner
Okay. Thank you for that. Door dash says B of A could be in the s and P552 week high today. Kevin?
- [35:01]
Kevin Simpson
Yeah. Another pleasant surprise in our list of stocks. They had earnings on Tuesday. They missed on earnings per share, but they're putting so much money back in. They're plugging it into a grocery tech international expansion. They had 42 million monthly active users. It's unbelievable how well they're doing. So we like the name. We agree with the call. We think it's going higher.
- [35:20]
Scott Wapner
HubSpot. It's up big on an earnings. Beats a new record high. You can take a look at that Reiterated top pick at B of A price target to 900 from 783 at Goldman Sachs. Price target to 898 from 835 at Morgan Stanley. You own the stock?
- [35:37]
Bill Baruch
Yeah. And we added to it last week when we added to Uber. We actually use this internally. Three of my companies that need client management software and marketing. It's a terrific product. Their margins are increasing. Not only that, their margins per customer. I know. And their margins per customer on the report are increasing, increasing. Not only that, we see them as data. There's, there's the macro, more macro, broader data that some of these hyperscalers already have. We need to CRM. There's more micro data per. Per client. And I think this is, this is extremely valuable. And it's also a takeover target. Alphabet was looking at buying this name last year, but because of some regulatory maybe issues they didn't. I see the new administration. This is a takeover target. I really like it. I think this. More new highs are to come.
- [36:19]
Scott Wapner
Al says he bought some Moody's calls. He just told me that. I mean, you're his unofficial adviser. You like to move.
- [36:28]
Josh Brown
I don't know where his strikes or his expirations are, but so far so good.
- [36:31]
Scott Wapner
Well, he, he's, he believes in you, obviously. Obviously. Thank you for the trade update. We'll have to start bringing him in every time he makes a trade. Chevron, they say they're going to slash 20% of the workforce as part of a cost cutting plan. Kevin, on the name? Yeah.
- [36:47]
Kevin Simpson
It's been a disappointment for the past two years. It saved us in 2022 in a big way. We like the cost cuts for sure. We hate to see people lose their job, but from a capital expense standpoint, they're increasing production a little bit. We've owned the name for 13 years. Interestingly, it's our only exposure in energy at the moment. So I feel like if you can get into the stocks down here, if you believe in the energy play, you're going to be rewarded over time. But I don't think it's going to be a short term play. It's an investment, not a trade.
- [37:12]
Scott Wapner
Liz, Energy like it?
- [37:14]
Liz Young
I do like it and I will probably continue to like it for the year. I mean, it's been such a laggard. So people looking for value stocks, I think it does benefit. I also think it can benefit from an increase in M and A activity as the year goes on. So I wouldn't sleep on energy here.
- [37:27]
Scott Wapner
Okay, quick break. Santoli on the other side with his midday word. Senior markets commentator Mike Santelli joins us now with his midday word. What's your thought today on this market activity?
- [37:55]
I
You know, Scott, the market's revealing its preference for very little to change, I think relative to what we came into the year assuming. And you can see that with the kind of two days of inflation numbers netting out to really no grand conclusion that there's been an inflection beyond what we thought, which was sideways inflation metrics. That's been fine with the bond and stock markets today. And then in general, just no tariffs of any sort is preferable to just selective ones or across the board ones. So if you can defer that risk, I think the market is able to rest a little bit. It's really hard, though, to ignore just exactly how kind of tightly coiled the market is is getting here in terms of being sideways in this trend for a long time, a narrowing index range for the S and P, constant churn and and rotation. I don't think it's unhealthy, but it probably means you would trust whatever decisive break comes out of this range. Maybe as we get beyond all these expirations this week and next week, that will maybe release the indexes to move.
- [38:57]
Scott Wapner
A little more big. Momo names either getting rewarded or pounded based on what they report in earnings.
- [39:03]
I
There's a whole part of this market that just so spring loaded and it's showing you that with these reactions, some of them are heavily shorted. There's a lot of fast money in them. And I find it fascinating that that's all going on in a week when the Retail Investor Weekly survey, which is not that reliable, showed a huge jump in bearishness. So old buy and hold investors are very skeptical. They're headline sensitive, they're cautious. And then you have YOLO stuff happening in other parts of the Markets. It's very fascinating mix.
- [39:30]
Scott Wapner
We'll see how the day develops. I will see you on closing bell. Mike, thank you. That's Mike Santoli, our senior markets commentator. Up next, the one big chart standing out to Josh Brown today. He'll tell you what it is next. All right. The one big chart that Josh Brown says you need to know about today. It's right on your screen. Tell us why you're focused here.
- [40:02]
Josh Brown
One of the most exciting things about the US Stock market this year so far is that it looks like we're going to finish this quarter with something on the order of 16% earnings growth. Unless in video something shocking to the upside of the downside that seems pretty secure. But in Europe it's not altogether different. You've got big beats for European companies, specifically European blue chip, very large companies. And I think it's worth pointing out this, in this index right now is outperforming the S and P. Let's take a look at the fez. So that's, that's a proxy for large cap Europe. It's like the Dow Jones of Europe. And please keep in mind this excludes England. Okay, so it's mostly Germany and France and Spain to some extent. FEZ is up 14% year to date, 12% over the last 12 months. So the rally is accelerating. The RSI is at 73, a little bit overbought but still has room. 9% above the 50 day moving average, 7% above the 200 day. And this is the highest level for the FEZ since 2008 almost 20 years ago. When you look at what stocks are making this up, asml, we all know it's involved in lithography for chips, but also SAP. Siemens is doing great. LVMH is a big weight in gear. Schneider Electric, Total Energies, Total Energies, Allianz. Some of these companies are highly involved in the financials rally and some of them are involved in AI and automation and robotics. And if you don't have this in your portfolio or you've been ignoring it because of S and P outperformance, every once in a while things flip and you'll be shocked at how well some of these overseas markets can actually do. So take a look at Europe. If you haven't yet, consider possibly adding some to your portfolio.
- [41:51]
Scott Wapner
What do we think?
- [41:52]
Bill Baruch
You know, it sold off into the quarter four we've rotated out of Europe. We have it in our ETF portfolio that couples with an 8020 we got went to equal weight S and P&IJR after the market had rallied about late January. I think there's some tailwinds here, a lot of negativity coming into the year. So it's definitely, as Josh pointed out to probably very under positioned and that's where the flows begin to pick up and that's where you have a move.
- [42:15]
Josh Brown
Like they had an AI festival in Paris last week and the country, France said that they're going to put $109 billion into AI investments, which by European standards it's like, it's, you know, it's not Alphabet, but it's like adorable low key.
- [42:33]
Scott Wapner
You're, you're basically playing for the bottom. I mean that you've, that you've seen the bottom in, in Europe we had.
- [42:40]
Josh Brown
A 20 year stretch where the differential in performance between European large cap stocks versus the S&P 500 historically stretched like we have never seen a differential. So it's not to say like these stocks, stocks deserve a 21 multiple like the S and P, but they're cheap. You don't have to pay that sort of multiple. And if they get some things right in tech and they relax on all the regulations and they decide they want to be a player in AI rather than the referee, you never know, there could be some big winners here.
- [43:11]
Bill Baruch
There's a currency thing here too. It's the dollar topping. If the dollar ends up topping, which I do believe you're going to get some tailwinds in the euro and that's going to be really good.
- [43:20]
Scott Wapner
You make to. What about, what about this, Liz?
- [43:22]
Liz Young
Look, I mean, unpopular opinion is that international outperforms the US this year. I think it's quite possible Europe might be a part of that. However, that's probably not the first place that I'm looking for buying.
- [43:33]
Josh Brown
China beat China beat the S and P last year. Almost nobody you talk to knows that.
- [43:37]
Liz Young
Exactly.
- [43:38]
Josh Brown
So these things have a habit of sneaking up on people.
- [43:40]
Scott Wapner
All right, we have one more committee move to tell you about and we will do that right after this. Okay, we're back with that final move that we need to tell you about today. It is Kevin Simpson and you bought Salesforce.
- [44:32]
Kevin Simpson
This is a big deal, Scott, because In August of 2020, Salesforce entered the Dow Jones industrial average, a benchmark that we track our dividend strategy against. It wasn't a dividend payer. So for the past three or four years, I listened to Josh talk about how great this company is. We couldn't own it. A few quarters ago they initiated a half a percent dividend. We put it on our board. We now decided Liz opened the show with the idea that software and the rotation into it is a theme for 2025. We totally agree with that. So this is a stock that we own again in the dividend portfolio as an investment for the long term. Really thinking about the infrastructure and how you're stuck in there. Josh has hit on that point numerous times. But digging into the numbers, the margins are expanding. We think agent forces for real and we look at the company at 330 and think that there is a tremendous, tremendous upside. It's a small initial position. It's going to be some volatility. We'll build it out over time. But a name.
- [45:24]
Scott Wapner
We're excited to own earnings on 226. So we'll see what they report and what you do to follow up. We will bounce and we'll come back with finals next.
- [45:36]
AT&T Business Narrator
Are you following the Halftime Report podcast?
- [45:38]
Josh Brown
What are you waiting for?
- [45:40]
AT&T Business Narrator
Look for us in your favorite podcasting app.
- [45:43]
Josh Brown
Follow the Halftime podcast now.
- [45:48]
Scott Wapner
I hope you'll join me on closing bell 3:00 Eastern today. Dubrov Kolakos will be there. JP Morgan, of course, Marcy McGregor, Malcolm Etheridge, we have a lot to talk about. Let's do some final trades before we get out of here for the day. Kevin Simpson, what you got?
- [46:00]
Kevin Simpson
Agnico Eagle minds. They report today at the close. Scott, we're expecting a fifth consecutive quarter of record free cash flow.
- [46:06]
Scott Wapner
Thank you very much. Bill Baruch, how about you?
- [46:08]
Bill Baruch
Gold has been setting record highs. Now it's time for silver. It's time for copper. Copper itself is up by more than 10% month to date. Freeport is still near the lows, only 10% off. The lows flush out negativity during its earnings. I like Freeport to run here.
- [46:21]
Scott Wapner
Thank you.
- [46:21]
Liz Young
Liz Young Thomas, I mentioned before that Europe wouldn't be my first pick if international outperforms the US that was a preview because China would be Josh Brown.
- [46:32]
Josh Brown
Very quietly Starbucks, which I'm long hit a new high 52 week high this morning. The all time high is out at 126 from a couple of years ago. Brian Nicholl is just getting started. I'm staying long this name.
- [46:44]
Scott Wapner
All right. We'll follow that as well. Track this market which is higher across the board right now. It does it for us. I will see you on the closing bell at 3. You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern only on CNBC. All opinions expressed by the Halftime Report.
- [47:06]
AT&T Business Narrator
Participants are solely their opinions and do not reflect the opinions of CNBC, NBCUniversal.
- [47:11]
Scott Wapner
Their parent company, or affiliates, and may have been previously disseminated by them on television, radio, Internet, or another medium.
- [47:17]
AT&T Business Narrator
You should not treat any opinion expressed.
- [47:19]
Josh Brown
On this podcast as a specific inducement.
- [47:21]
Scott Wapner
To make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Halftime Report participants consider reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it.
- [47:36]
Josh Brown
Should not be relied upon as such.
- [47:37]
Scott Wapner
To view the full Halftime Report disclaimer, please visit cnbc.com halftimereportdisclaimer.
- [47:43]
Liz Young
For 140 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.
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AT&T Business Narrator
Learn more at multicare.
- [47:58]
Kevin Simpson
Org.