Can the Rally Regain Momentum? 8/6/25

Summary

Halftime Report: Can the Rally Regain Momentum? (August 6, 2025)
Host: Scott Wapner, CNBC
Guests: Joe Terranova, Liz Thomas, Malcolm Etheridge, Steve Weiss

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Introduction

In the August 6, 2025 episode of CNBC's Halftime Report, host Scott Wapner engages with top investors Joe Terranova, Liz Thomas, Malcolm Etheridge, and Steve Weiss to discuss whether the current market rally can regain its momentum. The panel delves into key stocks, market sentiment, and economic catalysts influencing investor behavior.

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Apple Inc. (AAPL) as Stock of the Day

Apple takes center stage as the Stock of the Day, experiencing its best performance since May 12th with a nearly 6% increase.

Key Highlights:

• Investment Boost: Apple is increasing its U.S. investment by $100 billion, totaling $600 billion.
• Tariff Resilience: The White House indicates Apple will largely remain unaffected by tariffs targeting India.
• Presidential Meeting: CEO Tim Cook is set to meet with President Trump, highlighting a strong relationship.
• ETF Rebalancing: Joe Terranova discusses personally buying Apple despite recent ETF sell-offs.

Notable Quotes:

• Joe Terranova [02:19]: “I came right out and knew that I had to buy it. The reason is positioning and sentiment.”
• Malcolm Etheridge [04:33]: “Apple is trying just to make sure that they stay out of the ire of the President.”

Discussion Points:

• Momentum vs. Fundamentals: Joe emphasizes positioning and market sentiment over Apple's flattened revenue growth, suggesting collective buying pressure is poised to drive the stock upward.
• Malcolm's Perspective: Focuses on Tim Cook's diplomatic role and Apple's strategic investments to mitigate political risks.
• Steve Weiss's Take: Contrasts momentum-driven investing with fundamental analysis, advocating for undervalued stocks with strong fundamentals over chasing momentum in Apple.

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Market Sentiment and Economic Resilience

Liz Thomas provides insights into the broader market dynamics, emphasizing the resilience of consumer spending despite high valuations.

Notable Quotes:

• Liz Thomas [08:37]: “The consumer has been under pressure, but what's happening right now is because goods prices have increased... we have to spend more money on goods, which means we're going to spend a little less money on services.”
• Joe Terranova [13:11]: “I'm looking at something different. I’m not necessarily sure how we return the market to an environment where fundamentals more than anything else are driving the flows of capital into the market.”

Key Points:

• Consumer Spending: Despite high credit card debt and rising goods prices, Liz maintains that as long as employment remains stable, consumer spending will continue.
• Valuation Concerns: Recognizes that the market is more expensive but sees opportunities in minor corrections.
• Economic Indicators: The panel discusses upcoming economic data points, including CPI, PPI, and jobs reports, which will further influence market momentum.

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Impact of Buybacks on Market Momentum

The role of stock buybacks in sustaining market momentum is examined, with a particular focus on Apple's aggressive buyback strategy.

Notable Quotes:

• Steve Weiss [10:30]: “What’s driving the market is momentum... fundamentally sound companies like Apple are seen as low-risk holds despite flat earnings.”
• Scott Wapner [10:30]: “Buybacks are pacing for a record this year. July saw a record $165 billion in announced buybacks.”

Discussion Points:

• Buyback Significance: Apple’s substantial buyback program is viewed as a stabilizing force, providing a floor for the stock.
• Contrasting Strategies: Steve advocates for focusing on undervalued stocks with strong fundamentals, while Joe prioritizes momentum and positioning.

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Sector and Stock Calls

The panel delves into specific stock recommendations and sector analyses, highlighting both buys and sells.

Leidos Holdings (LDOS) Upgrade

Notable Quotes:

• Steve Weiss [27:53]: “Jefferies upgraded Leidos to buy from hold with a target of $205 from $185... management is executing their plans perfectly.”

Key Points:

• Government Contracts: Leidos benefits from a substantial portion of its workforce embedded in government projects, ensuring steady growth.
• Cybersecurity Focus: The company’s focus on cyber services is a significant growth driver.

Eaton Corporation (ETN) Outlook

Notable Quotes:

• Joe Terranova [29:25]: “Revenue up 50%, data center orders up 55%... momentum is building for semis.”

Key Points:

• Earnings Performance: Strong performance in infrastructure and data center sectors positions Eaton for continued growth despite recent stock volatility.
• Growth Catalysts: Anticipates earnings growth and continued investment in capital goods to drive the stock.

AXON Enterprise (AXON) Discussion

Notable Quotes:

• Malcolm Etheridge [35:27]: “Earnings growth has been pretty solid since they shifted to a software company, selling subscriptions.”
• Joe Terranova [32:48]: “Axon is a momentum-driven stock supported by revenue and earnings growth.”

Key Points:

• Transformation Success: AXON's transition from hardware to software has significantly boosted its growth trajectory.
• Momentum Sustainability: Despite being labeled as a "cultish" momentum stock, the panel acknowledges AXON's solid earnings fundamentals.

Iron Mountain (IRM) and Prologis (PLD) Sales

Notable Quotes:

• Malcolm Etheridge [38:02]: “I sold Iron Mountain on the expectation of continued stock decline post-earnings... Prologis has been a dead stock with no meaningful returns.”

Key Points:

• Dividend Concerns: Despite being strong dividend stocks, both Iron Mountain and Prologis failed to deliver significant returns, prompting sell decisions.
• Market Sentiment: Investors are taking profits and positioning for potential market pullbacks, influencing sell-offs in these stocks.

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Market Catalysts and Future Outlook

The discussion shifts to upcoming economic data and potential catalysts that could influence the market's next moves.

Key Points:

• Federal Reserve Actions: Anticipation of rate cuts is a significant market catalyst, with 94% market pricing for a cut. However, upcoming data could sway this outlook.
• Economic Data: Upcoming CPI, PPI, and jobs reports are critical in assessing economic health and influencing Fed policy.
• Job Market Stability: Continued employment levels without significant layoffs support consumer spending resilience.

Notable Quotes:

• Liz Thomas [45:05]: “The next big catalyst, I think, is the Fed and whether or not we get that rate cut... the market is going to be really disappointed if we don’t get the cut.”

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Closing Segment: Stock Recommendations and Final Thoughts

The panel wraps up with final stock recommendations and reflections on market strategies.

Notable Quotes:

• Steve Weiss [47:06]: “I’m fully invested till further notice... I see a potential drawdown of 5 or 10%, but we'll recover quickly.”
• Malcolm Etheridge [39:32]: “I'm using the cash to get in position for things that I think are going to happen, like buying ASML.”

Key Points:

• Diversified Strategies: While some panelists advocate for fundamental and undervalued stock investing, others emphasize momentum and positioning.
• Preparedness for Volatility: Investors are advised to remain vigilant for potential market corrections while maintaining a strategic investment approach.

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Conclusion

The Halftime Report episode underscores the complex interplay between market momentum, fundamental analysis, and economic indicators. While Apple remains a focal point with its strong performance and strategic positioning, the broader market sentiment is cautiously optimistic, hinging on upcoming economic data and Federal Reserve actions. Investors are encouraged to balance momentum-driven opportunities with fundamental valuations to navigate the evolving market landscape.

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Notable Timestamps:

• [02:19] Joe Terranova discusses personal purchase of Apple.
• [04:33] Malcolm Etheridge on Tim Cook's diplomacy.
• [08:37] Liz Thomas on consumer spending resilience.
• [10:30] Steve Weiss on buybacks and market momentum.
• [27:53] Steve Weiss on Leidos upgrade.
• [38:02] Malcolm Etheridge on selling Iron Mountain and Prologis.
• [45:05] Liz Thomas on Federal Reserve rate cut catalysts.

Transcript

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[Scott Wapner]

I'm Scott Wapner and you're listening to CNBC's Halftime Report, the podcast the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in. Carl, thank you very much. Welcome to the Halftime Report of Scott Wapner. Front and center this hour, stalled stocks and the big question facing the investment committee today in the record setting rally regain its momentum? We will ask. Joining me for the hour, Joe Chernova, Liz Thomas, Malcolm Etheridge and Steve Weiss. Stocks, they are modestly higher today. We will have a lot more on that in just a moment. We're going to start though with our stock of the day. It is Apple. It is having its best day since May 12th. We've talked about it on this network all morning long. We've even thrown it on the screen for you there. It's up near 6%. So they're boosting the U.S. investment by $100 billion to 600 billion total. The White House says that Apple is going to remain largely unaffected by the tariffs that are targeting India. Tim Cook's going to be at the White House this afternoon to meet with the President. He says he has a good relation with President Trump. And Joe Terranova, who just sold Apple in his latest rebalance in the etf, has bought the stock and he's done so personally. Why did you do that?

[Joe Terranova]

Absolutely have to do it. First of all, there's a lot of people have made great calls. One of them is sitting on this desk. Gentleman to my left, Malcolm, great call down at 190. Josh Brown made a great call on the show yesterday as well. Scott, I've mentioned to you over the last several days that personally I wanted to own Apple. But my purchase of Apple this morning and it was done in the pre market, yes, all the haters out there will say no I didn't. Trust me, I did. I came right out and knew that I had to buy it. And the reason is positioning. Positioning and sentiment, those are the two things I rely on. I'm always looking at where is everyone positioned and and universally momentum funds, myself included paring back the holding of Apple because of the significant underperformance over the last 12 months. That is with certainty growth managers carrying Apple at an underweight leaning more towards the Nvidia's the palantirs of the world. It's almost like you're short. It literally is like you're short. And I think right now collectively you have all of the quantity, the quants, all the algorithms that are participating and as price, if you are worshiping price, if you are chasing price, then you have to go in and you have to buy Apple today in your fund.

[Scott Wapner]

Josh Brown, since you referenced him yesterday on this program said quote Apple seems to be finding support here, doesn't seem to want to go down anymore. We shall see. Malcolm, you've suggested to buy it as well. You own the stock. What do you think about buying it right here based on this news? We were talking before the program, you said that Tim Cook's been acting more like a diplomat than a CEO lately and maybe that's paid off. Maybe that's why he's so good at what he does and how he's been able to manage his relationship with President Trump which has publicly appeared to be a little dicey at times.

[Malcolm Etheridge]

Well, Tim Cook and Jensen Huang, I'll throw him in that same category. Both of these guys chief job is basically being a diplomat right now because they if not, they both have a China problem. Right. And so for Apple to say we're going to spend another $100 million investing and building in America, probably in Texas. We haven't heard the announcement yet, 4 o' clock or so this afternoon. I think that realistically what we're talking about is Apple trying just to make sure that they stay out of the ire of the President here.

[Scott Wapner]

I find it interesting Joe, just to come back to you for a minute because you run this rules based ETF that dictates to you whether you can add the stock to your ETF or not. You don't have a discretionary decision to make. It's all dictated by what the rules tell you in part based on momentum, or the lack thereof that had existed in this stock which prevented you from adding it to the etf, but now you see momentum gathering, that the stock has turned the corner, so you can add it. Personally, can you square those two things for me? Because I have a hard time getting my arms around that.

[Joe Terranova]

In addition, by the way, if you look at the quality factors, the revenue growth is kind of flattened out. The revenue growth has not been there. The significant weighting of Apple and The S&P 500 presents a little bit of a problem from a portfolio standpoint. In particular, when you know that at a certain point you have a potential bullish catalyst that's going to affect price. And you look around and you say to yourself, where are we in sentiment? Where are we in positioning? And in both those instances, the suggestion that, that I am. That I am understanding from that leads me to believe that you have a lot of people that are going to have to step in and buy the stock. And that's what I'm focused on. I'm focused on the positioning and the rebuilding of the positioning because you have to get back up to that significant market cap weighting that it has in the S&P 500. I've also believed that there has been a tremendous amount of resiliency since April in the stock. It's appeared several times like the stock is going to break down. And I've said on air, Apple does a really good job of almost paying you to wait.

[Scott Wapner]

I mean, it's sideways, right?

[Malcolm Etheridge]

Right.

[Scott Wapner]

Look at the chart from April. It had the rebound from the April low like everything else seemingly did. And then it's been a sideways mover.

[Joe Terranova]

Correct. While everything else is kind of rallying, Apple's trading in this sideway range. So, yeah, you also have the ecosystem and the ecosystem, you know, while the stock might not be performing well, the ecosystem remains pristine and people still go out and buy those products.

[Malcolm Etheridge]

Your focus is on positioning, mine is actually on sentiment. So you gave me the two sides of it. I think the fact that for the last year and a half, roughly since Apple's iPhone, sales have been declining, we've been hearing nonstop calls from analysts up and down the street saying, apple, it's time to do something. It's time to do something. Where's your strategy? Negative things to say about the stock. However, no one was taking down their price target. So which is it? Do you feel negatively about the stock enough to take down your price target?

[Scott Wapner]

Took it down today to 230. They had 240B of A keeps their 240 as they reiterate a buy on it. Now what's undeniable, if you look at the intraday charts of the Nasdaq or the Dow or the S and P for that matter, Apple's helping the overall market today given its weighting in the S and P. What it means to the Nasdaq, which is the highs of the day as Apple is too, and the meaningful nature it's contributing to the Dow as well. So you're basically highs the day across the board. Liz Thomas, welcome back.

[WhatsApp]

Thank you.

[Scott Wapner]

So good to have you back.

[WhatsApp]

So good to be here.

[Scott Wapner]

Being a mommy is great. I'm sure it's great to have you back.

[WhatsApp]

It's lovely.

[Scott Wapner]

So we've been a little unsettled. S and P is down five of six days. Nasdaq's down three or four. Jonathan Krinsky of BTIG says we continue to think the S and P works its way back to 6100 as we head through August. To which Citi says, well, that might happen, but you got to buy the debit. So give us your view of this market.

[WhatsApp]

You know, it's funny, I think I went out on March 16th and if I would have went to sleep on March 16th and woken up today, it would have looked like we're at all time highs. The market's been sort of unaffected. We just made this little tiny rotation back into growth so stocks. But obviously a lot has happened in that period. So I think where we sit today, and I'm not going to harp on valuations, we've done that over and over and over again. I've heard it through my entire leave about valuations.

[Scott Wapner]

Maybe the stock market is more expensive today than it was before you left it.

[WhatsApp]

What it is, it is, absolutely. And when you look at the percentiles, it is. But you still have to look at it from a perspective of I think from these levels, the market is difficult to impress and it's easy to disappoint. That doesn't necessarily mean you buy it with a lot of fervor today because it's hard to convince people of a really big bull case from these levels. But even to Krinski's note, if we go from where we are today, 6350 down to 6100, that's what a three and a half percent move, not that big of a deal. It would be an opportunity. And I do think that this uptrend can continue. You just have to make the bull case with different points. Things like the economy is still stable, just slowing. There's room for more multiple expansion in the AI theme because enthusiasm will win that day. You've got a lot of macro data points that maybe are softening, but they're not screaming alarm bells. Right. And I think you have to stay on this train of you want to be invested in US Tech, you have to stay invested in it because that's where the innovation is happening.

[Scott Wapner]

I got a whole list of reasons that some would suggest, Weiss, that you should stay bullish. What are the catalysts to keep this rally intact, to get this market jump started once again? Maybe buybacks, Maybe Joe. What Joe has talked about, that's one thing. Apple buys back more stock than anybody else. That's always been considered to be a floor under this name. CNBC Pro today says this is the stock market secret sauce. Buybacks are pacing for a record this year. July saw a record 165 billion in announced buybacks. Year to date, We've now hit $926 billion. You are one of your favorite stocks. Uber today, $20 billion buyback. What do you make of all that?

[Steve Weiss]

Yeah, well, I wouldn't call one of my favorite stocks it's top position. Look, you know, like Apple announcing, you know, a bigger spend in the US Companies that announced buybacks, they announce it's when they buy back the stocks that matter. So announcements just don't drive it. It's what they actually do in the market. And in terms of just go back to Apple for a second and this goes to the overall market, what's driving the market is momentum. And just like neither of you know whether it was Joe or Malcolm, not once they mentioned fundamentals. So what they're doing, essentially not Malcolm so much at 190, is chasing momentum. So I don't know how to do that. In terms of managing to benchmark, chasing.

[Scott Wapner]

Momentum in a name like Apple, that doesn't make much sense to me. There has been no momentum in Apple. In fact, they're not chasing, they're anticipating. Well, today. But Joe, Joe bought it. I mean, maybe they're anticipating momentum returning. It doesn't feel to me like he's chasing anything other than a great opportunity potentially for a stock that's done nothing since the rebound in April.

[Steve Weiss]

Over the last five days, the stock has moved up and it's moved up measurably. So to me, if you find momentum as what the recent prices have been, it's moving it now. Is it a low risk hold here? Probably, but the fundamentals are still Punk. They still are flat in their revenue. They still flat their earnings over an extended period of time. So if you're looking for laggard gap, buy it. If you can buy it on news that isn't news all of a sudden because yes, tariffs and no tariffs won't impact them, then buy it. Me, I'd rather look at companies that are truly undervalued, that have great fundamentals, one of being lidos, another being ftai, another one haven't been caterpillar. So that's where I choose to play in terms of the overall market. You know, it's indicative of the market. The market goes up or not much news goes up on the absence of bad news or on bad news going, going away as we've seen, you know, repeatedly with tariffs. So look, 90% of companies so far in the second quarter versus the first quarter, meaningful increase have mentioned tariffs. 84% mentioned uncertainty according to facts that's still going to influence the market.

[Scott Wapner]

But guys, please, valuation rather than this for two months because it's at the highs of the day is Apple and I reckon that the stock market itself is too. You're pushing 6% gain. Sorry to cut you off, Weiss, but you want to respond to this, Joe?

[Joe Terranova]

Yeah, I just, I disagree, Steve. I just don't see that the last five days the stock has been up significantly. It fell after earnings, a good earnings report, post earnings it was up. But look, we just have different strategies. I respect Steve's strategy. He looks at fundamentals. I'm looking at something different. I'm not necessarily sure how we return the market to an environment where fundamentals more than anything else are driving the flows of capital into the market. It seems as though that genie is out of the bottle and we are in an environment where it's more about physicists than mathematicians who are writing algorithms. And you might want to say they're chasing momentum, but I agree with you.

[Scott Wapner]

No, no, I'm going to go down the list for you and show you why perhaps the fundamentals will be more at play than maybe they've been recently. It was a momentum driven market by large regard. I mentioned the buybacks. No one does more than Apple. It's the secret sauce according to CNBC Pro. I urge you to go take a look at that article as well. You can see it for yourself. The other thing is there's a lot of cash that needs to be deployed. Bank of America today cash levels are high and so will the need to allocate. Cash levels today are more than 30% higher than we might expect. You don't like that? Well, how about more dovish Fed speak? Neel Kashkari, He's a voter. Next year he was on squawk. He says two rate cuts this year seems appropriate. Says reversing course on rates may be better than waiting. Well, that's interesting to hear from him. You already had two dissents from Fed governors. You don't like that? How about the fact that the consumer is pretty good still? Raymond James, Consumers healthier than government data suggests. Disney beats Hugh Johnston, the CFO on CNBC said today, quote, I know there's a lot of concern about the consumer in the US right now. We don't see it. Our consumer is doing very, very well. You remember what Brian Moynihan, the CEO of bank of America had to say yesterday. He painted a picture that sounded pretty darn bullish. Liz Young. Liz Thomas Excuse me, Adjustment.

[WhatsApp]

That's only going to be for a couple of years.

[Scott Wapner]

Exactly, exactly, exactly. Give me time. I'll call you Liz Young Thomas For a little bit. I'll call you Liz Young. It'll take me a while to get.

[WhatsApp]

To what you're talking to.

[Scott Wapner]

Exactly. So what about that? What about all of that? I just made a pretty big case. Is it believable?

[WhatsApp]

Well, so when we think about the consumer, the consumer spending has been a topic that we've belabored for a very long time. Inflation should have eaten into it. We should have been stretched a long time ago. Credit card debt had gotten to these all time highs. That should have been a problem, especially with interest rates where they were. I could go on down a list of why the consumer should have been under pressure. The consumer has been under pressure. What's happening right now is because goods prices have increased. When you look at things like core goods, ex autos. So the stuff that people spend money on besides cars, it's increased a lot month over month. I think it's a point six percent month over month and that's the highest level that it's been in a while. Consumers are just making choices now. So we have to spend more money on goods, which means we're going to spend a little less money on services. And then you see the market react to that accordingly. It's not that consumers have pulled back across the board and said we're not going to spend. So I do still think we're in a good place. And I have long said and still believe the consumer will keep spending as long as the consumer is employed. Now we had a rough jobs report last week. But it wasn't negative. Right. We didn't contract in jobs.

[Scott Wapner]

Right. Because this Brian morning it was just less than job growth slowing.

[WhatsApp]

Correct.

[Scott Wapner]

Is different than jobs being eliminated.

[WhatsApp]

Exactly.

[Scott Wapner]

We haven't seen layoffs.

[WhatsApp]

That's right.

[Scott Wapner]

So the labor market slowing a bit. Do you you want to be negative the market in the face of what I said, all this cash that needs to be deployed, Fed speak becoming even more dovish. You know rate cuts are coming. It's just a matter of when, not if. The consumers hanging in pretty well. Oh yeah, and the idea that the mega caps are going to continue to lead this market higher, that the money's going to continue to flow to the best and the biggest and therefore the market's going to go up. At least the S and P, even nasdaq. Hold on Weiss, I'll come to you in a moment.

[Malcolm Etheridge]

Even given everything Liz just gave us about the consumer and all the yeah buts that the consumer has given us in return, right. Yes I should be negative but I'm still outspending. I'm still of the mind that we should be focused on spending our dollars or investors should be buying companies where enterprises who they rely on not necessarily the consumer. So yes, the consumer has shown a lot of resilience. But when I look at the companies that have done 25% or better year to date, I'm talking about Microsoft, I'm talking about Nvidia, I'm talking about Broadcom, none of these companies sell anything to the general public. But when I think about the companies that do touch the consumer, Tesla, Apple, Amazon, they're negative year to date. And so I'd much rather own anything that's enterprise related, enterprise tech especially rather than relying on the consumer right now which if there are cracks in the system at any moment those cracks could start to really break out. And now we're talking about trying to catch clear.

[Scott Wapner]

I don't bring up the consumer number as a question as to whether you should buy retail stocks. Those are two different arguments to have. But if you have a 2/3 service based and consumption based economy and the consumers hanging in there. My point to you is were you really going to get negative as long as the consumer continues to hang in there and as long as the job market remains at least maybe it's tightening, maybe you're going to have a slow of job creation but as long as you don't have layoffs that changes the equation altogether. You want to get negative the market in the face of that.

[Malcolm Etheridge]

But at what point does that break right? How many layoffs is enough to suddenly make the entire street decide maybe we ought to go in a different direction? Right. We're starting to reach capitulation around the idea that something's got to go wrong because we're all feeling too good right now. That's the mood with all the different investors that I talked to today. And so if you think about where you usually are supposed to zig when the market, when, when general consensus zags, I think that's probably a case for. If the labor market does start to show one more crack, is that enough to start to force us in the other direction?

[Scott Wapner]

I don't know.

[Malcolm Etheridge]

I just don't want to be in position to have to catch it.

[WhatsApp]

Like some of those measurements have already hit and the market still held up. Right. I remember when the SAHM rule hit and everybody freaked out. And then there's another measurement. I think Gundlach talks about the moving average of unemployment when it gets, when the three month moving average gets above the 12 month average, something like that. I don't know exactly. All of those metrics have hit already and it didn't fall apart. And I am guilty as charged. Somebody who looked at all of those and said, oh, here we are, here's the precipice of disaster. Right? Just waiting for this next big thing to happen. But then it didn't. So I'm not saying that it won't, but you can't invest based on just waiting for those metrics to then tell us, okay, sure fire this happened. Here's the number. Now we're headed for recession because this has again, been the recession that just never came.

[Scott Wapner]

That's right. Weiss, the, the what if investor has been run over by this bull train.

[Steve Weiss]

Yeah, no, absolutely. And look, it's just an unusual mark. I've said repeatedly we've got a different cohort, a different population that are investors now and active investors, and they really don't get focused on fundamentals. Just want to take one second to address what I said about momentum. I'm not a momentum trader. I believe in the strategy and which is why Jyoti is one of my larger positions, because I know Joe does that. Well, now back to everything you mentioned, but I want to focus on the consumer first. Moynihan came out and said consumer spending through the end of July is up 5%. Malcolm's point was that we've got Microsoft, we've got video, we've got, you know, Apple, the CEOs, they're all diplomats. Well, guess what? So are the CEOs of other companies everyone. Because everyone could be singled out. So Moynihan in particular, he made that comment. He made that on the heels of being attacked for not banking conservatives. Now, July is an important date because you're a consumer. You want to buy a card. Said buy before the August tariffs hit. So there's a lot of pull forward buying. Don't take past as prolock. That's going to peter out and we're going to see meter out. And yes, credit card balances remain high. So there's a danger of being, you know, complacent in this market.

[Scott Wapner]

So are you negative the market again? Now I'm confused, Weiss, where do you stand on this market? Are you, are you growing negative on the market again?

[Steve Weiss]

I'm fully invested till further notice. But if you look at my, if my positions, which I talk about often, I'd say 70% of my exposure is in, is in big cap tech. So I'm playing it. I own Caterpillar to bounce a little bit, FTI to bounce a little bit. So I'm staying with the market, you know, for now, but I'm not complacent. There may be a drawdown of 5 or 10%, but we'll recover quickly. So I'm not the time this market.

[Scott Wapner]

So Malcolm, you have a new buy. Maybe it plays right into what you're talking about, about sticking with tech names. Chips have been a question mark, not so much in the last few days. Some haven't traded all that well of late. You bought asml. You want to take me inside that trade and why you decided to add that name, which is only up 1.5% over the past three months. And if you compare that to some of the other names that are up a tremendous amount, I mean, it lags so dramatically it's not even funny. Sticks out like a sore thumb.

[Malcolm Etheridge]

I think you just, just made the case for why you'd want to buy it. As the disciplined investor I like to tell myself that I am, I want to buy into weakness. I don't want to buy necessarily at moments of significant strength. And so what I'm looking at, at asml, it's equally as important in the conversation we're having around AI as names like Nvidia Taiwan. Semi. Right. Nvidia sells chips to about 80% of the global market right now for all things related to AI Taiwan. Semi is their biggest company customer in Taiwan. Semi is dependent on asml. So ASML has had a China problem for some time. They've been talking about it on earnings calls, but they've got a 50 plus percent profit margin over that same period. And I think we're at a place now where we can start to look at them turning the corner because the, the, the AI conversation has shifted now from being on laptops and PCs to now going mobile. Well, what does that mean? It means they're going to need to refresh that equipment. They being the actual foundries that are, that are making these chips, they're going to need to refresh the equipment, buy new equipment that they use to get smaller and smaller nanometer chips into their sets. That's going to all benefit asml.

[Scott Wapner]

You like the chip equipment names because you just added a couple to the Jyoti, Kla and Lam were also added to bank of America's global contenders list. Those are the two names that you just added in your rebalance. What do you, what do you think of this move? Do you like it?

[Joe Terranova]

I do because what I see see in the semiconductor industry is number one, I see tariff relief. Number two, I see the potential for clarity surrounding the restrictions with China. Although in the case of AMD today, that is why the stock is clearly down because the Mi 308, they were unable to include that revenue in the upcoming quarter. Street obviously didn't like that. But you're talking about an industry where you're not going to get the type of earnings growth that's being existed, exhibited anywhere else. You're talking about 30% earnings growth from the semis and the semis once again are coming back. I think ASML will participate. I know Steve has a Taiwan semi which has done remarkably well. And at some point here as we move through the third quarter, you're going to hear from Broadcom, which has been the sleeping giant amongst all these semiconductor names. So I think the momentum is building for semis and I think that will continue through the remainder of the year.

[Scott Wapner]

All right, up next, we're going to do our calls of the day. We have a big upgrade today for a defense name. It's up 8% this week. Someone on this desk owns it today. Halftime's back in two.

[Edward Jones]

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[Scott Wapner]

All right, we're back. Calls of the day. We start with a stock that Weiss just mentioned a few moments ago, one that he absolutely loves unless he tries to refute that too. Leidos, because that's just the way you are. Weiss Leidos upgraded to buy from hold the target to 205 from 185 at Jefferies. Why don't you tell us why you love this so much?

[Steve Weiss]

Steve well, you know, I've gotten to know Tom Bell, the CEO pretty well and and went in there before I bought the stock to talk about it and their new management essentially over the last couple of years and they came out with a plan and they executed perfectly in line with the guidance they laid out and their methods of operation when they took over. And that's come to fruition and put this in perspective. You know, the DoD came to 10 companies, Booz Allen being one, the large government contractors, Lockheed. And what they said was you got to give us back something on the contracts. And Leidos is part of that. And so Leidos, 30% of their of their headcount is embedded in the government. So they're able to navigate through that. So the business continues to grow, they continue to beat and raise. The stock's not expensive. Jefferies came out with a target of 205 and up. Great at this level. I think there's a lot of upside here. So it's a bit on management, it's a bet on what they're doing in cyber and everything else. That is the soft part, I'd say of the defense market not being soft as you touch, but not metal benders. So high margin I like quite a bit. And pull back.

[Scott Wapner]

Okay, thank you. Eaton. Target hike to 425 and 375. Overweight Morgan style. Stanley, we think the margin headwinds will prove transitory. Valuation already discounted versus its peers. Joe, you own it. What do you think?

[Joe Terranova]

You know, in the, in the A block we were talking about the fundamental tailwinds for the market. One thing I think we left out has been earnings. Earnings continuing to deliver overall for the S and P and in particular in the industrial sector. Eaton, classic example of really high expectations. Stock was performing remarkably well going into early earnings. Earnings reported, stock falls. There's your bad price action. You take the other side of that. In particular, where it is right now, technically at the 50 day moving average. But you turn back and you say what are these earnings look like? They are participating in the infrastructure, the data center. Build out. Data center orders up 55%. Revenue up 50% accordingly. This is not something that you move away from just because it looks like everyone's appetite is full and they don't want to eat dinner. They're going to come back tomorrow, they're going to eat breakfast, lunch and dinner again.

[Scott Wapner]

Okay. Caterpillar, Weiss, Target goes to 507 at Truist. Target goes to 495. Bank of America. You talked about this stock as well.

[Steve Weiss]

Yeah, look, I bought this for exposure where I didn't have it at the time I bought it was, let's say less expensive than it is now. I viewed quite frankly as fairly valued. The quarter was good, but I'm not very excited about it. Even though it's a core position. I'm Going to ride with it because again, it's counterweight to what I have elsewhere. And let's face it, with increased onshoring, they should participate. The risk is, of course, if Ukraine and Russia settle their differences, then you could see more commodities come up the market outside the US and also lowering commodity prices. So that may soften demand. But I don't see that happening anytime soon.

[Scott Wapner]

All right. Liz Young. Thomas. Liz Thomas. Just call me Industrials. Industrials. Weiss is so distracting that it distracts me when I come off from him to you. Therefore it happens. Magnus. Yeah, but nothing good. Bad things stick to you. Industrials are the second best sector year to date. Do you like.

[WhatsApp]

I mean, look, it's always hard to like something when they're doing so well. You worry about when it's going to turn. But I do still like them. And there's a lot of economic activity that again has been warning us that something's going wrong. But industrials, especially the capital goods sector of industrials has been doing really well and I think you still can own them here. Here the same rules apply to when you're looking at mega cap tech. You see companies that have gone up a ton. They're at all time highs, they're way above the technical levels that they should be. Just be careful of your entry points.

[Scott Wapner]

I'm just going to call you Liz. That's going to make it complicated myself. Why would I do that to myself repeatedly? Whatever. Axon.

[Joe Terranova]

Yes, sir.

[Scott Wapner]

Axon, we talked about this yesterday.

[Joe Terranova]

Sure did.

[Scott Wapner]

This has been caught up in meme mania, in cultish stock activity.

[Joe Terranova]

Let's, let's raise that a little bit. Yeah, it's cultish. Well, the law enforcement industry is certainly behind the stock with good reason.

[Scott Wapner]

Is this the former Taser?

[Joe Terranova]

Yes, this. They have the technology that's in place right now that's servicing that industry.

[Scott Wapner]

Okay. The target goes to a street high a thousand bucks at bank of America. I mean, are you refuting the fact that it has been caught up in that mania? A little bit.

[Joe Terranova]

I think, I think it's a retail happy. It's, it's a, it's a mid cap stock. I think it's very similar to what you're seeing and app love it in Palantir. I don't think it's like, you know, seeing what, like what you're seeing in some of the other stocks. I mean it is delivering the revenue growth. Here's how you.

[Scott Wapner]

What do you mean in some of the other stocks? You said yesterday that you take Palantir you could take Palantir out of it. You included Applovin with this and something else yesterday. As in the cultures thing. No, no, no.

[Joe Terranova]

The momentum cult, Scott. The momentum cult. I think we're having a difference of the way we're looking at it. You're telling me these are meme stocks? I don't look at this as a meme stock. I look think of a meme stock and I don't want to offend anyone.

[Scott Wapner]

I said a cult stock. Cultish stock.

[Joe Terranova]

I think it's momentum cult for sure. Absolutely. It's the cult of momentum.

[Scott Wapner]

There are different grades of cult stocks.

[Joe Terranova]

Well, listen, there are some real earnings behind these companies, so I don't want to disregard that. I think some of the real earnings.

[Scott Wapner]

Behind Palantir too, and that can be.

[Joe Terranova]

Included in the classification that I'm describing. I think some of the meme stocks, you know, I don't think they delivering the earnings that some of these companies are. There is no.

[Scott Wapner]

What stocks would you characterize as?

[Joe Terranova]

I'm not going to offend people out there. You know, the, you know, the stocks out there that have been, you know, rally.

[Scott Wapner]

But now I don't. I thought I did. Now I'm not going there.

[Joe Terranova]

I'm not going there. Let's talk about Axon for a second. All right. It is a clear momentum driven stock. Yes. Supported by some revenue growth and good, good revenue growth and earnings. But in addition to that, the way you look at the stock right now, first of all, analyst community, 88% buy rating on the stock, average price target 884 price target's going to go higher. Yesterday's low at $800. If you are risk managing the stock, if it goes below $800, maybe you want to reduce your position if you have discretion and the ability to do it because it should not go back below $800.

[Scott Wapner]

Is American Eagle a meme stock?

[Joe Terranova]

No comment.

[Malcolm Etheridge]

I'm going to, I'm going to back you up for one second, potentially even bail you out.

[Joe Terranova]

Please do that for the next 20.

[Malcolm Etheridge]

Seconds and say if you look, look at the five year chart on Axon, it has been a momentum stock for five years. Right. Earnings growth has been pretty solid since they made the shift from being a hardware company selling tasers and body cameras to realizing that they are a software company and they can sell subscriptions to people. And that was what really expanded the growth in that company. So for that one in particular, the rest of the names you mentioned, I got no bailout for you. I got no bailout for you. But for Axon specifically, I think that's where the real shift happened.

[Scott Wapner]

All right. He appreciates you very much. Christina Partsanovelos joins us now with the headlines. Hi there.

[WhatsApp]

Hi, Scott. Fort Stewart army base in Georgia right now is on lockdown after report of an active shooter. In a Facebook post, the base said there are casualties but didn't offer any additional details. Schools in the area were also locked down. Fort Stewart is about 40 miles southwest of Savannah. Vice President J.D. vance is set to host a dinner with senior administration officials tonight, Reuters reporting. Officials include White House Chief of Staff Susie Wiles, Attorney General Pam Bondi and FBI Director Kash Patel. They are expected to discuss how the administration handles the fallout over the Jeffrey Epstein case. And a seven year research study on Alzheimer's disease found lithium could play a major role in early detection, new treatments and also understanding just how a brain ages. In the study published today in Nature, scientists at Harvard Medical School found they could reverse the disease in mice with small doses of a lithium compound and actually restore some brain function. Very cool stuff, Scott.

[Scott Wapner]

All right, Christina, thank you very much. Christina partzanovelis. Coming up next, more committee moves. Malcolm ready to talk about two stocks he just sold. We'll tell you which one's next.

[Edward Jones]

Is it time to reimagine your future? The right business skills may make a difference in your career. At Capella University, we offer a relevant education that's designed to focus on what you need to know in the business world. We'll teach professional skills to help you pursue your goals like business management, strategic planning and effective communication. And you can apply these skills right away. A different future is closer than you think with Capella University. Learn [e-mail] Heading back to school? Head to DSW first and save up to 25% on select styles from big deal brands. Score major savings on must have shoes and accessories from Nike, Adidas, Crocs, Reebok, hey dude. And Under Armour. You don't want to miss this one. These brands are almost never on sale whether you're prepping for the kids first day back or just for a busier calendar. Get up to 25% off a styles for women, men and kids at your DSW store or dsw.com for a limited time.

[Scott Wapner]

So let's talk about Malcolm's moves. I said he had a couple and they're both cells. Number one, Iron Mountain. Why?

[Malcolm Etheridge]

So yeah, so if you're a dividend investor, this is still a great stock for you to own. But for me, I Sold that when I had earnings, just on the expectation that I looked at what happened with the big banks when they reported. I looked at what happened with Big Tech when they reported great, solid earnings numbers and the market still responded by selling their shares down. And so I expected the same thing from Iron Mountain. And so far that's what we've seen. But I've been in this name for the past year and have nothing to show for it but a 3% dividend. So if you look at its valuation in comparison to its peers in the xlra, I just, I don't think that it's going to take off in any meaningful direction anytime soon. It's probably going to continue to trend.

[Scott Wapner]

Why do you think the market's been doing that? The way that some of these stocks have been reacting post earnings, the way they have expectations just got too high on some names.

[Malcolm Etheridge]

I think it's sentiment. I think even though when we look at the year to date number, the S and P is still doing single digits, it feels like if you just think about April 9th, the snapback that's happened since then, it feels like the market is doing significantly better than it is. And I think that investors are just looking to take a breather, take some profits here and wait for the next thing. I mentioned before, consensus seems to be we're overdue for a pullback and everyone's trying to position themselves for that pullback.

[Scott Wapner]

Including you?

[Malcolm Etheridge]

Well, including me to a degree, but I'm actually prologist. I also bought bought asml with the proceeds, so I'm using the cash to get in position for things that I think are going to happen. Looking forward, I think we're probably due for a rate cut that's going to set up great opportunity to buy in names like FinTech.

[Scott Wapner]

Why did you sell this?

[Malcolm Etheridge]

So I sold Prologis similarly, but it's been a dead stock for me for the year that I've owned it. It hasn't actually done well and if you look at vacancy rates, they brag about a 95% or so vacancy rate, but across the industry that rate is increasing and so see the year and so sentiment in that name. It's been a round trip basically for me since I've owned that stock and again, I've only got a 3% dividend to show for it in the time.

[Scott Wapner]

That I own this.

[Joe Terranova]

Yes, the ETF loves to buy this. We have not had much luck as you've described.

[Malcolm Etheridge]

Yeah.

[Scott Wapner]

What do you mean loves to buy this?

[Joe Terranova]

When was the last time you owned it? The ETF has owned this several times. I believe that we are owned it at the end of last year. I'll pull up my file in a second. But we've owned it several times and we haven't done well with it.

[Scott Wapner]

Your numbers reliable this time?

[Joe Terranova]

Oh, boy, here we go.

[Scott Wapner]

All right. Still ahead, Mike Santoli's midday word that's coming up next. We're back on the Halftime Report. Our friends at GOLF Channel following the PGA Tour stop this week at the FedEx St. Jude Championship. Reporter Todd Lewis joins us live from Memphis, Tennessee, with what to expect as the playoffs begin. We're really excited about this.

[G]

Yeah, why wouldn't you be? It's a great tournament here to start off here in Memphis, where it's going to be hot and guys will be sweating on and off the golf course as they try to advance ultimately to East Lake in Atlanta for the Tour Championship. Scotty Scheffler has really no worries. He's number one in the FedExCup standings. He will be at Eastlake. Last time we saw Scottie Scheffler, he was walking around the 18th green at Royal Port Rush in Ireland holding the Claret Jug. Well, since then, he's had a little bit of downtime. He did go to the Netflix premiere of Happy Gilmore 2. He's one of the players in that movie, one of the many PGA Tour players. And if you've watched him in that movie, you might say, hey, he might deserve a best supporting nomination for a PGA Tour player. I'm not sure that's an Oscar category. But regardless, he's in a great frame of mind heading into the playoffs. Now, this is a big week for players trying to advance to next week's PGA Tour playoff event, and that is the BMW Championship. You advance to that tournament, then you are set for all of 2026 to play any tournament you want, especially the signature events, which have more money and more FedEx cut points. And players this week, big players need to make a move like Wyndham Clark, Jordan Spieth, Rickie Fowler, Xander Schofle. You can see all the action on GOLF Channel Thursday and Friday and on Golf Channel and NBC on the weekend.

[Scott Wapner]

Scott, important to note, too, Todd Rory's not there and really the only one of the big names who's skipping the first round of the playoffs. Why so?

[G]

Well, you make a great point here. He is skipping this event. There's supposed to be 70 here. There's 69. Rory's not here. One big reason is the fact that the Tour Championship has Changed its format. It used to be the guy who was leading. Last two years it's been Scottie Scheffler would have a two shot advantage over the rest of the field. Well, that has been eliminated. All you need to do is make it to the Tour Championship. Any player positions 1 through 30 in the field, if they win that tournament, they win the FedEx Cup. Rory is a lot to be at the Tour Championship. So he says why do I need to come here if I'm going to be in Atlanta in a couple of weeks?

[Scott Wapner]

Interesting. Todd, thank you. That's Todd Lewis live for us today in Memphis, Tennessee, Mike Santoli. He's next. We senior markets commentator Mike Santoli. He's just sat down post nine for his midday word. Thank you. Apple. Yeah, otherwise it's kind of the same kind of market you've been talking about.

[Joe Terranova]

It's almost 5050. I was just looking. It's like on the Nasdaq and the New York Stock Exchange, 2300 stocks up, 2300 down. Apple is about half the net gain. The s and P500. And then maybe if you think there's more in there, it's underperformed by 2500 basis points versus like the NASDAQ 100 this year. So that seems a bit of catch up. Still a net negative cast on the earnings reporters. I mean you have McDonald's up but then Disney getting hit. Emerson Electric a big drag on the S and P today. That follows Eaton you guys were talking about earlier. So there's just this rethink going on in terms of how much was priced into the good earnings. But I think it's going to net out to earnings in aggregate did their job, you know, to sort of substantiate where we are. It was a crazy twitchy trade in treasuries right around 11:30. 10 went from like 421 to 426 is pulse trade. And then it came back down very erratic and it seemed like it was connected to Kevin Warsh's poly market odds crashing by 20 percentage point. I mean weird stuff happening in a quiet day. It doesn't seem necessarily to lead to much in terms of tangible until we get claims tomorrow because I think we're going to be checking every piece of new data against the revised labor market report we got last.

[Scott Wapner]

Well, because we're trying to figure out, and Liz, you can comment on this too, what the next big catalyst is going to be. Earnings season's winding down. You're, you're not going to Have Jackson Hole for a little while. It's going to be hanging on every single economic data point now that comes out.

[WhatsApp]

Well, I mean, the next big catalyst, I think is the Fed and whether or not we get that rate cut, the market wants the cut. But we've got a lot of data that comes out between now and September 17th, I believe is the date. So we've got two more CPI, two more PPIs, we've got another jobs report. We've got Jackson Hole. As you mentioned. There's a lot that could still happen if any of those reports come in hot. We're not getting the cut. Right. And the market is going to be really disappointed in that if we get the cut. I think you see continued upside. I think you see that catalyst and the support that we need from the Fed.

[Scott Wapner]

You get that the tension is only building between the two mandates. Sure.

[Joe Terranova]

As inflation next week is for cpi.

[Scott Wapner]

Right. And then the labor market now is in question.

[Joe Terranova]

Yes. And you got six weeks until the meeting. Now, one thing you know about the Fed is you're going to have it priced before the meeting itself. Whatever's going to happen, you're going to have a sense of that. The question is what has to happen in the data to get the outcome you think you want.

[WhatsApp]

Right. And right now, the market 94% pricing for a cut. But again, we've got six data points that could swing that in 10 minutes.

[Scott Wapner]

See on closing bell. Okay, that's Mike Santoli. Finals are next. All right. Is it really? All right, we'll find out more about that after I tell you what's coming up on the closing bell. Dan Greenhouse, Ashley McNeil, Stephanie Link. Allie Flynn Phillips. Jonathan Krinsky. And we just added Dan Ives because Tim Cook's going to be at the White House this afternoon and we want to hear from Dan Ives about that. Now we'll hear from Liz. I learned my lesson, Liz. Final trade is what?

[WhatsApp]

It's financials.

[Scott Wapner]

Okay.

[WhatsApp]

So I talked about the recession that never was. We've got economic resiliency. I think financials can benefit if we get those rate cuts. Valuations are not as bad as some other parts of the market and you need something to diversify that growth overweight.

[Scott Wapner]

All right. That was another positive call on that group today, as a matter of fact. Steve Weiss. Do tell. Your final trade Uber.

[Steve Weiss]

Like, why not? I mean it's going to be a permanent compound to build that reputation. Porter was good. The buyback will happen.

[Scott Wapner]

So very fun. I mentioned is one of his favorite stocks. He immediately tried to refute that, but then uses it as his final trade. That if that is in a nutshell, I don't know what is.

[Malcolm Etheridge]

Malcolm Rocket companies looking at stocks that should do well the moment we get that first cut. Liz was talking about Walmart.

[Scott Wapner]

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

[Edward Jones]

All opinions expressed by the Halftime Report participants are solely their opinions and do not reflect the opinions of CNBC, NBCUniversal, their parent company or affiliates, and may have been previously disseminated by them on television, radio, Internet or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Halftime Report participants consider reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Halftime Report disclaimer, please visit cnbc.com halftime reportdisclaimer@ Capella University, learning the right skills could make a difference. That's why our business programs teach you relevant skills you can take from the courseroom to the workplace. A different future is closer than you think with Capella University. Learn more at Capella Eduardo.