Debate: The Path for Stocks 6/16/25

Summary

Halftime Report Podcast Summary: "Debate: The Path for Stocks" (June 16, 2025)

Hosted by CNBC's Scott Wapner, the June 16, 2025, episode of Halftime Report delves deep into the current state of the stock market, dissecting the influences shaping investor sentiment and forecasting potential trajectories. With insights from top investors Joe Terranova, Carrie Firestone, and Jim Leventhal, the discussion covers a gamut of topics from geopolitical tensions to sector-specific performances, all aimed at guiding listeners through the complexities of today's financial landscape.

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1. Market Outlook and Geopolitical Influences

Scott Wapner sets the stage by highlighting the tumultuous global environment impacting the markets. Key focal points include ongoing tensions between Iran and Israel, upcoming Federal Reserve meetings, and interactions within the G7 summit.

Geopolitical Stability and Market Resilience:

• Joe Terranova notes the market's resilience despite geopolitical headwinds, emphasizing that events like Iran signaling negotiations with Israel (referenced at [03:20]) have only provided temporary boosts to stock prices rather than causing prolonged downward pressure.
• Carrie Firestone counters this by suggesting that while the market ascends, it faces valuation constraints, particularly around forward earnings multiples. She states, “I think the market has certain constraints that are built in...bound by valuation to some extent rather than by what's going on from either Trump's conversations or who's bombing who” ([03:44]).

2. Federal Reserve and Interest Rates

The upcoming Federal Reserve meeting is anticipated to be a critical determinant for market direction. The discussion centers on the behavior of treasury yields, with the 10-year yield holding steady at 4.40%, defying expectations that would typically exert downward pressure on equities.

Interest Rates and Market Expectations:

• Jim Leventhal advocates for a bullish outlook despite current valuations, citing, “once you get to that all-time high, FOMO hits in, it's going to happen” ([05:21]).
• The consensus among the panelists is that while there may be short-term volatility, the long-term trajectory remains positive, contingent on corporate earnings and favorable regulatory developments.

3. Technology Sector Analysis

Technology remains a leading sector, driven by advancements in artificial intelligence and robust earnings growth. The panelists discuss the performance of major tech players and the strategic moves within the sector.

Key Tech Stocks and AI Influence:

• Joe Terranova highlights Microsoft and Meta as standout performers, attributing their success to AI integration and strong operational results. “It's been remarkable the breakout that we have seen in Microsoft and I think it's AI related” ([10:25]).
• Jim Leventhal underscores the importance of value-oriented tech stocks, mentioning companies like Cisco Systems and Qualcomm as strong contenders that offer growth without exorbitant valuations.
• The discussion touches on Apple's challenges, with differing opinions on whether to add to its position. Jim Leventhal remains optimistic about Apple's future despite current underperformance, emphasizing the company’s consistent operational delivery ([11:07]).

AI and ETF Strategies:

• The conversation moves to investment strategies surrounding AI, with Dan Ives introducing an AI-focused ETF that concentrates on top performers in the artificial intelligence space. Dan Ives explains, “this is what I view as the winners and the second, third, fourth derivatives of the $2 trillion that's going to be spent in the next three years” ([35:07]).
• Emphasis is placed on the longevity and transformative potential of AI, positioning it as a cornerstone of the fourth industrial revolution.

4. Energy Sector Dynamics

Energy markets are dissected, particularly focusing on oil prices, supply shifts, and the impact of tariffs on Canadian oil exports.

Oil Prices and Canadian Energy Companies:

• Joe Terranova discusses investments in Enbridge and Suncor, noting the strategic advantage of Canadian oil producers amidst U.S. refiners grappling with tariff-induced margin compressions. “Canadian oil companies are not eating the tariff. It is the US Refiner that actually is eating the tariff” ([21:21]).
• The panelists agree that Canadian energy firms present a resilient investment opportunity due to their ability to supply excess crude oil if necessary, contrasting with U.S. refiners' struggles.

5. Banking and Financial Sector Insights

The banking sector is analyzed in the context of robust IPO performance and increasing household equity allocations.

Record Equity Allocations and IPO Success:

• Joe Terranova references a Goldman Sachs note indicating that households have reached a record high allocation to equities at 49%, surpassing the previous peak of 48% in 2000. This heightened investment in equities supports current market valuations.
• Carrie Firestone points out that strong capital market activity, particularly in public markets, benefits major banks like JP Morgan, Morgan Stanley, and Goldman Sachs. “Capital market activity is very strong...maintaining an overweight exposure to the finance” ([25:51]).

6. Health Care Sector Evaluation

Health care stocks, particularly those involved in diagnostics and medical devices, are scrutinized for their defensive positioning and growth potential.

Performance of Health Care Stocks:

• Carrie Firestone defends holding UnitedHealth despite its significant year-to-date decline, citing structural changes and anticipated improvements in Medicare and Medicaid reimbursements. “They are fixable, that they are going to have better Medicare reimbursement” ([41:26]).
• Jim Leventhal highlights companies like Abbott and Boston Scientific, noting their defensive nature and potential for recovery based on strong operational performance and strategic growth initiatives.

7. Investment Strategy and Momentum

The final segment emphasizes the importance of momentum in a healthy market, advocating for maintaining positions in winning stocks while shedding laggards.

Momentum as a Key Investment Factor:

• Joe Terranova emphasizes the value of sticking with strong performers and adjusting allocations based on momentum: “Stay with winners, shed the losers” ([42:07]).
• The hosts discuss various high-performing stocks, including Cisco and Insulet, reinforcing the strategy of identifying and capitalizing on momentum-driven winners to maximize portfolio performance.

8. Conclusion and Forward Look

As the episode wraps up, the panelists reiterate the importance of staying informed and adaptable in a dynamic market environment. Upcoming topics include finalizing the analysis of major portfolio winners and losers, setting the stage for continued in-depth market evaluations in subsequent episodes.

Looking Ahead:

• Scott Wapner previews future discussions on AI's impact on the market and the strategic moves of pre-IPO tech employees.
• The panelists encourage listeners to engage with the podcast for ongoing insights and expert analyses to navigate the evolving financial landscape.

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Notable Quotes:

• Joe Terranova ([03:20]): “I still believe that's where we're going.”
• Carrie Firestone ([03:44]): “I think the market has certain constraints that are built in...bound by valuation to some extent.”
• Jim Leventhal ([05:21]): “Once you get to that all-time high, FOMO hits in, it's going to happen.”
• Dan Ives ([35:07]): “This is what I view as the winners and the second, third, fourth derivatives of the $2 trillion that's going to be spent in the next three years.”
• Joe Terranova ([42:07]): “This is a good exercise. Everyone should be doing it. Stay with winners, shed the losers.”

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For those seeking a comprehensive understanding of the current stock market landscape, this episode of Halftime Report offers invaluable perspectives from seasoned investors, blending real-time analysis with strategic investment insights to navigate the complexities of 2025's financial markets.

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. I'm Scott Wapner. Front and center this hour, rising stocks to start a busy week for your money. We, of course, are watching Iran and Israel developments there, a Fed meeting coming in a couple days at least, the decision and the G7 ongoing, as you saw earlier, that bilateral between President Trump and Canada's Carney. All our eyes on everything today. Joe Terranova, Carrie Firestone, Jim Leventhal with me at the desk. So, Joe, we have Iran signaling, according to the Wall Street Journal, that they want to negotiate, the president all but corroborating that in the little spray they had with reporters at the G7 Fed decision. Oppenheimer says downward pressure on stocks is unlikely to be a protracted overhang. Is that how you feel as well?

[Joe Terranova]

That's how I feel and that's what the market is telling us. We have the NASDAQ 100 and the comp, both above Thursday's close. The S&P 6045 was the close on Thursday. We're about four or five handles below that right now. So we've made this dramatic recovery. 1652 week highs for S&P 500 companies. You've got IBM, Microsoft, Palantir, Darden, debt. Asked some names that I've mentioned frequently. And yes, we continue to show the resiliency in this market. And what's interesting to me is not even the geopolitical aspect of it is the inability with the geopolitical events to see relief in treasury yields. We didn't get the buying in treasury yields. Maybe the markets were pricing in some inflationary outcome from oil. I'm not sure. I don't think anyone ultimately really knows.

[Scott Wapner]

Like five different hypotheses on why yields were doing what they were doing on Friday and almost got a different answer. For five different people that I interviewed on either program on Friday, either halftime or closing bell, it seems like I got a different.

[Joe Terranova]

I agree with you and the reality is you have a 10 year sitting at 4.40 and that was supposed to be a challenge and a problem for markets. But here we are, the s and P60, 40 pushing towards a new all time high and I still believe that's where we're going.

[Scott Wapner]

Kerry feels like when that headline crossed that Iran was signaling that it wanted to negotiate with Israel, the market got a little bit of a pickup off of that. We've pretty much held it. We're off a little bit from where we were. But do you agree with Oppenheimer today that whatever downward pressure comes to stocks because of geopolitical events or otherwise are unlikely to be a protracted overhang?

[Carrie Firestone]

No, I don't think I agree with that. I think they're trying to broad brush say that the market is going up regardless.

[Scott Wapner]

And you don't agree with that?

[Carrie Firestone]

I think the market has certain constraints that are built in and we've seen it this year already several times. The market gets to the 22 times forward earnings and it seems to be pushing up against the ceiling. I know that the markets can trade to 23, 24 times but this market seems to have trouble pushing through that and I blame that on concern about earnings growth and it could be earnings growth or less than expected earnings growth that's a result of tariffs or any kind of events or inflation or just the employment situation. We haven't had a bad situation. It's all positive. But that's what the market begins to worry about. So I think we're still in that range. That's bound by valuation to some extent rather than by what's on going going on from either Trump's conversations or what's happening in terms of who's bombing who.

[Scott Wapner]

Krinsky at BTIG is looking at a choppy summer ahead that the S and P. The S and P is into formidable resistance at 6050 to 6150. Pay attention to where we are now. We're at 6036 that you have initial support at 5970. I know we're throwing these numbers out, but that's what the technicians sort of do for a living. Major support at 5,800. So as long as that holds, the Bulls maintain the upper hand and we can expect new highs later on in the summer. Make sense, Jim?

[Jim Leventhal]

I think pretty soon, frankly. You know, look, we're 1.5% away from an all time high and we know what happens Regardless, Kerry, of the analytical skills which you just displayed, which I love as well, you know, once you get to that all time high, FOMO hits in, it's going to happen. It has nothing to do with numbers or forward multiples. It has to do with people looking at what's going on, saying I want in. I think that's what's going to happen. I think it's going to happen soon. And actually, I actually think the numbers support it. From this perspective, if you look at earnings estimates for next year, and I know this is a long way away, $300 a share carry 22 times $300 a share, 6600. Now the question here is are we actually going to hit those estimates? Well, that all depends on trade deals coming through, the tax bill getting through. And I actually think those are going to happen and that you'll get a clear Runway. So Scott, when you were talking about Krinsky and the chop. Yeah, that chop to me is what happens in the summer as people shift from looking at 20, 25 earnings to looking at the year ahead earnings. And it's not a perfect transition. It's choppy as it happens. But if you get some trade deals, if you get the reciprocal tariffs down to a reasonable level and the budget bill in place, this market goes higher on fomo.

[Scott Wapner]

So what I, it's, it's, maybe it is fomo. Joe I thought that note today from Goldman Sachs sets the table for so many different layers of this conversation that households allocation to equities hits a record high. 49% of their total financial assets are in equities, the highest level on record and slightly above the previous peak of 48% in the year 2000. That suggests to them that if you continue to get high allocations to equities, you're, you obviously have support for where the market is and you support the valuations that some have here questioned.

[Joe Terranova]

Yeah, I think what's interesting is that households really never moved to the sidelines when we had the sell off in April. It was institutions that were moving to the sidelines. I respect your argument about 22 times being a little bit rich. Jonathan Krinski saying the markets could chop. I don't know if that's a reason to see sell though, because I think all that means potentially is you soften somewhat over the third quarter and you pull back maybe to 5550, 700. And from there, where do we go in the fourth quarter? So I don't use that as a reason to sell more, I think more and set the expectation. Okay, maybe you are not breaking out above the all time highs that Jimmy and I see coming. Maybe you get up there and it's a little bit of a short term trap. But I think over the next six months there's continued support in the form of strong corporate earnings and potentially in the form of some regulatory release.

[Scott Wapner]

When I see the Goldman note today, I'm like, well, okay, Robinhood Interactive, Schwab can throw them all up ice, 51 after another because it's part of the obvious place to look. Carrie, you have Schwab.

[Carrie Firestone]

Yeah.

[Scott Wapner]

Was reiterated by today at Truist. The price target, 100 bucks. You see, Robinhood was up. There's interactive brokers up 4%. We can take that before we get to the next layer of the conversation.

[Carrie Firestone]

Yeah, I think one of the factors that's really helping those stocks is not just the hope and the belief that there'll be deregulation, but we've seen that interest rates are not giving you more of what people who say, oh look over here, you can have 5%, maybe 5 1/2% on your money. You don't have to speculate in the stock stock market. Well, that really hasn't happened. People are still employed. We're at the low unemployment level that we've been at for years. They've got money to invest and the place to invest it has been markets. And not in, and not in bonds.

[Scott Wapner]

Yeah, it's, it's like, well, where are they trading if they're, you know, have such a high allocation to equities? You look at the obvious places that we just did, among others, and what are they buying? Technology is the leading sector off of the April lows, as I don't think is going to surprise anybody. Along with Comm Services, Big Tech's furious rally forces options pros to line up hedges. That's according to Bloomberg today. And you have a number, Jim, of names within the tech complex that continue.

[Jim Leventhal]

To rise and of all stripes frankly. So I'll start with Nvidia, which is everybody's favorite, right? I mean what is it about 6% from an all time high much like the market, I think it's just going to get sucked up there and once it hits that all time high again, carry fomo. It happens. But if you want to look and basically whether it's the market or the technology sector, this is a stock pickers market. So if you're somebody like me, you're looking at stocks that are value tech but which are doing phenomenally well. You can look at a Cisco Systems, you can look at a Qualcomm, you can look at a Google, which we've, excuse me, Alphabet, which we've been talking about a lot more the past few weeks as a value tech stock. But stocks that are starting to work so you don't have to just kind of hold your nose and buy the most expensive technology stocks out there. As I said, all stripes of technology stocks are working and for the very good reason that that's where earnings growth is.

[Joe Terranova]

It's been remarkable the breakout that we have seen in Microsoft and I think it's AI related. And look, I'm not just saying this. I watched It's Apple, I watched, I watched Thursday show Brad Gerstner with was phenomenal in just simplistically describing the universe that we're living in here surrounding this innovation.

[Scott Wapner]

But record high today for Microsoft, record.

[Joe Terranova]

High continues to break out Meta trading remarkably strong as well in video trading. Well and yes to your point, it's Apple throwing up your hands as a shareholder and saying okay, what am I getting from you in the near term that's going to revive the growth and give me confidence that the AI strategy.

[Jim Leventhal]

Any capital because I'm, they're going to do it kind of like no, they're going to.

[Joe Terranova]

I disagree with that. Apple will deliver, but Apple will deliver.

[Jim Leventhal]

I mean is there any reason for me to add to it right now? I just can't come up with a convincing because you have a, you have.

[Joe Terranova]

A reasonable alternative in Microsoft, you have a reasonable alternative in others and oh by the way, at some point open AI is coming.

[Scott Wapner]

Well, you just said an interesting question. The stock has obviously not performed great relative to the other Mag 7s. Is there any reason for me to add to Apple now? When do you want to add to it? When it's 250? That's my point. Aren't you supposed to add to stocks like that when they go through what this one has?

[Jim Leventhal]

That's an incredibly valid question and you know that that's what I like to do. We're going to talk about a technology stock a little later where I'm Doing the exact same thing with Apple. It has been just stuck in the mud for so long, long. And it seems to me to be dependent on this super upgrade cycle that just isn't happening. I agree Joe. It is going to happen. Scott, I think your question implies that you think it's going to happen and I do think it's going to happen. I just don't think it's going to happen.

[Scott Wapner]

I don't know whether it's going to happen or not or under what time frame is it going to happen. But it's interesting to hear a value investor look at a stock here and say would I really add to it.

[Jim Leventhal]

Here 26 times forward. But I'll. But I want to answer your question and for the viewers more specifically, when do you add to it? Let it develop an uptrend. It just shows, shows no sign of light.

[Ryan Reynolds]

I mean none.

[Scott Wapner]

I'm not sure people would say it's not, it's not like it's floating out there cheap, waving its hand in the air and saying hey, look at me, I'm, you know, under 20 times. In fact they're like 26 to 27 times.

[Joe Terranova]

I think 21 is the 10 year average. So no, it's a little bit rich in the near term. I don't know. You can't bet against it. I'm not selling it. You can't bet against two things, the ecosystem and the ability where they continue to buy back their shares. So you can't bet against that buying it right here. Look, you have alternatives and there's competition. When you think about the Mag 7, I could go to other places, I could buy a meta. I could have bought Microsoft a couple of months ago.

[Scott Wapner]

How about Amazon? Amazon's investing nearly 13 billion in data centers in Australia. This is after AWS invested 20 billion in Pennsylvania data centers. Last week they invested billions more in North Carolina. So they're going all in into where they think that they can get to. Everybody owns that stock.

[Joe Terranova]

Personally, I own that and I think. I'm sorry, I think that shows my conviction because the Jyoti ETF does not own it. And I said to myself I want it because of what you're citing related to the cloud. I want to be there in Amazon, own it personally.

[Carrie Firestone]

So here's an interesting thought about Amazon and it's a stock we own and we're very overweighted and we bought more fairly recently. But no one has thought about this angle. We all know that people want delivery and they want it quickly and it's Very convenient. But there are so many cases now in cities around the United States where the stores that people were buying goods, whether it's Target or CVS or Walgreens, are either closing or shrinking their inventory because of shrinkage, because of theft, because they can't support, they can't find workers for their retail locations. That Amazon becomes the only option that people had on the retail side. Keeps growing, of course, because of AI. But I think that the retail business that Amazon has taken is getting another lift up right now.

[Scott Wapner]

No us, as we asked the CEO last week, week in the exclusive interview that we had on the network from, from out on the west coast. They're really trying to build the, take the example of their marketplace and turn AWS into the marketplace for AI that that's the trajectory that they feel like they're on.

[Jim Leventhal]

And you know, AWS is a meaningful, I think it's over 50% carry of their profits. So I mean that's really where the growth is. You made a compelling case about why people are not going to buy at cvs. Fine. And there's also the tailwind developing of China becoming less of a headwind, the tariffs, they're becoming less of a headwind. But really this is now a pure play tech. Not pure play, but it's almost a pure play technology stock. And I would submit to you, it's not expensive, roughly 35 times forward earnings. But we always want to adjust that for the amount of R and D spend that they're doing, the amount of new businesses that they're developing. I think it's cheap, frankly.

[Scott Wapner]

Metta got a price target bump. Care 775 from 665. That's at Oppenheimer stocks at 700 bucks, more or less as we talk about it here. Still on that.

[Carrie Firestone]

Amazing. Yes. Still own it. Haven't sold any stock. It's been a phenomenal performer. I think that the market liked what it heard from Metta on the advertising front. What they can do for clients to create their own ad program, their own design with the tools that matter is applying for them. I mean, that was an amazing, I think, game changer for their biggest business. So that also is going to be a generator of revenue for them that no one had really factored into their models to the extent that they're going to.

[Scott Wapner]

Not everybody, by the way, has been a runaway winner in this AI race.

[Joe Terranova]

No.

[Scott Wapner]

You got sick and tired of holding Adobe.

[Carrie Firestone]

Yes, true.

[Scott Wapner]

Some have said they're just not in the same league with some of these other Stocks that have done remarkably well relative to the performance here. Adobe's coming off its worst week since June 4th. That's after earnings. That was last week.

[Carrie Firestone]

You sold it before earnings, right? Well, we sold it because unfortunately they're having trouble delivering. They're having trouble in their major business, Photoshop, where people use Adobe tools to create content that they couldn't do otherwise.

[Scott Wapner]

Well, now you can do otherwise. That's sort of my point.

[Carrie Firestone]

And yeah, and unfortunately this news from Meta and it's Google and it's going to be other places that people advertise such as Amazon. There the clients are going to be able to make their own content and Adobe has not moved fast enough with their own tools to keep their business.

[Scott Wapner]

So Kerry sold it to you.

[Jim Leventhal]

She did. She did.

[Scott Wapner]

You bought more.

[Jim Leventhal]

Yeah, I did. Now this is a position I've been adding to over the years. I cautious, I'm cautious in saying this, but I disagree with you quite strongly when you say they haven't delivered because at least as the earnings go, they beat on the top line, they beat on the bottom line. They raised guidance and you and I were speaking about this before the show.

[Scott Wapner]

They delivered.

[Jim Leventhal]

Let's.

[Scott Wapner]

Can we show that chart again, please?

[Jim Leventhal]

Can I do it to myself instead of you?

[Scott Wapner]

I was going to have the chart up there. So when you talk about delivering, I want you to see what they've delivered to you.

[Jim Leventhal]

I was going to do it.

[Scott Wapner]

Let's go to the intraday, please. Let's go to, I don't know, a.

[Joe Terranova]

Year, one year down, 23 year to date, one year down, 23%.

[Jim Leventhal]

I know, and I've been adding to it, building to it over the year. Now look, I want to. Carrie and I discussed this and we have different investing styles. She is a growth investor. She is not going to look at a stock like this and say, yeah, I want in. She's going to say I want out. I am much more of a value oriented guy. Again, when I was talking about delivering, I was talking about the operational results. Absolutely. The share price has been terrible. I understand why you got out. And it seems to, for whatever reason, stink the most when it beats on earnings. All that said, earnings estimates are starting to go up. They bought back shares to the tune of 5% of share count decline over a year. So it's not just me. They believe in what they're doing. The competitive threat that is out there, they are meeting it. That's why earnings estimates are going up. Now, Scott, you and I talk about this meeting.

[Scott Wapner]

What does that mean they're meeting it.

[Jim Leventhal]

You see it in the fact that they beat on the top line, they beat on the bottom line, they raised guidance and earnings estimates are starting to go up. So the rub against this stock has been there's competitive threats out there. Well, they are delivering on the operational results, not on the share price. They can't control the share price. The share price though is a matter of time. You can only outperform and they've outperformed consistently, consistently. Quarter after quarter. The share price inevitably follows and if it doesn't, they keep buying back shares, shrinking the share count. It may take a little time, but look, I've built it over the last year. I'm going to stick with it. You know, this is how I invest, you know, and this is. Doesn't matter whether it's Cisco, doesn't matter whether it's Citi. I build the position and then let it run when the market finally realizes.

[Joe Terranova]

They are at risk. In fiscal year 25, single digit revenue growth. The last time they had single digit revenue growth was 2014. They have to somehow revive that revenue growth. I've had concerns. You and I talked about this about nine months ago. We had gotten out of Adobe. We felt that there were challenges related to AI, what it would do to the product. Look, there's a massive earthquake coming in the technology sector and it's coming from open AI and I don't know, I don't know ultimately when OpenAI IPOs if there's going to be enough room for capital to be loved in all the places that it's being loved right now. I actually think it will be detrimental to some of the Mag 7 and to some of the names we're talking about here. Capital's going away from there. Not sure which ones in the Mag 7 are going to be feeling that challenge, but they will feel the challenge.

[Scott Wapner]

Let's talk about some other areas of the market that need to be discussed. They're making news today. Crude is lower after spiking on Friday. Plays into some of the moves that Joe has made made. You bought the iShares Israel ETF. Yes, that's one move. But Enbridge and Suncor are. How do that, how does that play into the whole, the totality of the story?

[Joe Terranova]

Okay, first of all with the Israeli etf, I've talked over the last several months about wanting to own it. It is near an all time high which it made on June 9th. Israel is the second leading exporter of technology. When we are talking about this innovation surrounding artificial intelligence Advancing to generative AI. Israel is right there alongside the United States, whether it's check point or cyber arc. So on Friday, you had the significant pullback. I believe that geopolitical pullback was an opportunity. You're getting exposure. 34% technology, 30% financial sector, another one of my favorite sectors. I wanted to step in there. As it relates to energy. Everyone is trying to predict the price of oil. There's very few people that I know that could do it successfully. You had one gentleman on closing bell who you and I both know very.

[Scott Wapner]

Well, Mark Fisher, even he's having a.

[Joe Terranova]

Tough time and he's having a tough time doing it. Okay, so I'm going to defer to Mark. What I'm going to tell you is the opportunity surrounding investing is thinking about where supply will shift if it ultimately has to shift. And so so far, year to date, it's interesting because the Canadian E and P's are actually out producing all of its developed international E&PS whether it's Europe, whether it's the United States, whether it's Australia. So I bought two names. I bought Suncorp and I bought Enbridge. Enbridge is the pipeline that is delivering the crude oil down to the United States. Suncor obviously, is the EP. There's this insatiable need on the part of U.S. refiners for Canadian oil. And you have a 10% tariff on Canadian oil. Well, guess what? The Canadian oil companies are not eating the tariff. It is the US Refiner that actually is eating the tariff. And you're seeing the margin compression there. So if you want to manage your risk surrounding this, you could potentially buy some puts in some of the refiners. Because I think an oil price in the mid-70s is challenging for the refiners. But the shift in supply, if it has to happen, Canada is the actual place where you'll be able to deliver the excess crude oil if the market needs it. And the performance so far there is year to date and the Earnings estimates in 25 in the U.S. collectively, energy companies have an earnings estimate in which they contract nearly 12%. The earnings estimate on Canadian oil companies, they only contract 20 basis points. So I think it's a great opportunity to think about. Okay, I'm getting exposure to two names in Canada that have outperformance relative to its geographic energy peers and also could be a source of excess supply.

[Scott Wapner]

Okay, we have retail sales tomorrow. Something to note, especially ahead of the Fed decision. You sold Casey's General.

[Jim Leventhal]

I did. Listen, I have to give a hat tip to Ralph Coutant in our office. He's the analyst who brought this to me. The stock has been beyond a home run and this is just one of those cases. I said it's a stock pickers market. You have to be willing to sell high if you're going to buy low. If you're going to buy some Adobe, you know you got to find it, you got to fund it somewhere. But it's just been a heroic stock. Now trades at a nice multiple. It probably goes higher. I'm not saying this is a terrible stock, not saying that at all.

[Scott Wapner]

I just needed funds for Adobe Discretionary. Speaking of has really felt like it's reversed whatever momentum that it's had. It's down 6% year to date. The worst performing sector. You do have casinos bouncing today. MGM had a good guide bet MGM did. Winds up. Airlines up Yom Delta Cruise lines up. You have a comment on those?

[Jim Leventhal]

Yeah, these stocks are bouncing around day by day by day. I mean whether it's Delta, I think it's up 4%. Wasn't it down 4% on Friday? And on the obvious news, right when you got missiles flying over the Middle east, what happens is you start canceling flights that are moneymakers from the US to to Tel Aviv and elsewhere. So look, it's going to be volatile but when you look at these stocks, much like many of the other stocks we're talking about, there is good operational performance and to the extent that the stocks get cheap, companies buy back shares whether it's wind, whether it's Delta. So as long as the cash flows are positive, and they are, these are stocks you can own.

[Scott Wapner]

You want to take note to Joe of Goldman today in some of these other bank stocks that are up. Care if you have any thoughts here too. I mean the IPOs that have recently hit market have been pretty, pretty successful to say the least. 88 have priced year to date. That's almost 40% higher than last year. 9 have doubled year to date. Among those core weave and circle chime surged as you know and certainly some of the other names did as well. This seems to be good for the banks.

[Carrie Firestone]

So we had an interesting conversation about this, this topic a few months ago where I think I said that what you needed for the banking, the investment banking business to, to do well is for there to be a rush in which they all work that it wasn't about, oh yeah, we're having a moderate amount and they're doing okay. That wasn't going to be it. You had to have a bunch that worked and worked really well. It may be that we're getting that and this is just all about, you know, market excitement, about whether it's, you know, crypto stocks are related. There are these categories that seem to ignite public interest, institutional interest. And that's going to be fantastic for the banks if it can continue.

[Joe Terranova]

Capital market activity is very strong in particular in public markets. We've seen that there's been this little paradigm shift over the last three months where there's interest in, in the public markets over the private markets. And that works through the benefits of the JP Morgan's, Morgan Stanley's and Goldman Sachs and the names that we've all been discussing still maintaining an overweight exposure to the finance.

[Scott Wapner]

We're back after this. We have our calls of the day coming up. A big upgrade for one of Jim's tech names. It is nearing a 52 week high. We're back on the half after this. Foreign.

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[Dan Ives]

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[Scott Wapner]

So to help us we brought in.

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[Scott Wapner]

Welcome back. Calls of the day today begins with Cisco mentioned it earlier. Jim did part of this cohort of old tech. Yeah that has done really well. This one IBM, you name some others. So was upgraded today to buy 73 bucks Deutsche Bank. They think there's improved visibility towards a durable mid single digit growth number in the years ahead. And tailwinds from AI.

[Jim Leventhal]

Yeah I think, I think probably high single digits beyond mid single digits. But I understand the analyst community is taking their time and they want to make sure that they get the this right. But I think where we are with Cisco is where we were with Oracle three years ago. If you remember back then it was still the database company. They were just building out the Oracle cloud infrastructure. But once they did that they got the multiple to go from the mid teens to now the low 20s. I think the same thing's going to happen here with Cisco. I think it's already happening roughly 16 times forward earnings, 3% dividend yields, buyback shares like crazy. I mean they've shrunk share count 20% over the last last eight years or so and it is on the back of of a tailwinds. It's also on the back of security. You know we always talk. Thank you Joe. We always talk about Palo Alto Networks, Fortinet, CrowdStrike again it. But there's also a really vibrant security business here enhanced by the acquisition of Splunk. And on the last earnings call Cisco was very clear that what they're seeing from their big big customers, whether it's hyperscalers, whether it's enterprises, they want it all in one. They want the, the hardware, the software and the security. Cisco is delivering it all right.

[Scott Wapner]

Yes they are year to date up 11%. Insulet initiated by 365 is the target at Truist.

[Joe Terranova]

Joe somewhat have to ignore the valuation here. It's in the mid-50s, a little bit rich stocks up 16% year to date. It delivers you the 20% revenue growth. But they have a degree of revolutionary type of medical device here with the Omnipad 5. That's the insulin patch. We're talking about dealing with diabetes here, not having to that have that shot anymore. So new CEO recently just stepped in. Ashley McAvoy company is in the sweet spot. We've owned it for some time Care.

[Scott Wapner]

Abbott initiated market perform today at Larynx143 is the target.

[Carrie Firestone]

Well Abbott's one of these names that's defensive. It's not quite in the crosshairs of of pharmaceutical companies that are getting bashed on all sides. Abbott's in the testing business and the diagnostic business. And that business has, has been strong and steady. They come through with the numbers. And it's exactly the kind of health care name that can outperform Insight.

[Scott Wapner]

Upgraded to a buy it's default positive results from a rare blood disease trial. You own that stock too?

[Joe Terranova]

We do, but I could tell you that the momentum has broken down here significantly. You might know this name. Well, it's Biopharma Oncology. Really. The last five years it's been a struggle, a little bit of a high valuation. We stepped into the name on a rebound in the stock. We saw some momentum that was developing even with this upgrade today, I don't see a green light ahead.

[Scott Wapner]

What About Boston Scientific?

[Joe Terranova]

Outperform 118@larink Medical Device is one of the favorite names. Again, valuation is a little bit rich here. A lot of these health care names, you're seeing valuations that are somewhat stretched. But we're staying with this name. So far, year to date, it's had strong performance. The earnings growth is there. And as long as that's visible, I think the position will be maintained.

[Edward Jones]

All right.

[Scott Wapner]

We'll get the headlines now with Contessa Brewer. Hi, Contessa.

[Contessa Brewer]

Hey there, Scott. Prosecutors will seek first degree murder charges against the man accused of killing a Minnesota lawmaker and her husband and injuring another lawmaker and his wife. Those charges include two counts of second degree murder and another two counts of second degree attempted intentional murder. The Hennepin County Attorney's office also said today suspect Vance Bolter went to a total of four homes looking to kill lawmakers, but some weren't home. The UN's nuclear agency is warning there could be contamination inside Iran's main nuclear enrichment facility in Natanz after Israel strikes. The agency head said right now, now radiation levels outside the facility are normal, but anyone inside has to wear special filters to protect against radiation risk. And in Paris, the Louvre is at a standstill. The museum staff today spontaneously went on strike during what was supposed to be a routine internal meeting. They're protesting unmanageable crowds and chronic understaffing. I mean, the way it looks here is that it's empty, right? But no, that's one more like what I remember from March, Scott. Last year, louvre welcomed nearly 9 million visitors, nearly double what the building is supposed to accommodate. And when, when I was there, by the way, there were massive crowds. And our guide said, you don't know how lucky you are today there is nobody here. This never happens. Crazy.

[Scott Wapner]

Yeah. We'll Follow that. Contessa. Thanks Contessa Brewer. Straight ahead. Today's ETF Edge Don Chu standing by with Star Tech analyst Dan Ives. He has a new ETF that theme is AI will discuss next. Hi, I'm Cyndi Lauper.

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[Scott Wapner]

Back with Senator Dom Chu, now with today's ETF Edge. Hey Dom.

[Dan Ives]

All right, so judge, we all know that has been the hot trade, but is it starting to show too many signs of getting maybe too hot? How do you separate some of the hype from the high quality? Joining me now is Dan Ives, the global head of tech research at Wedbush securities, who recently launched an ETF with his name as the ticker. Literally on the line. IV is the ETF name and it's basically your concentrated picks within artificial intelligence. What is the common denominator or the differentiating factors that make these the top picks amongst your AI plays.

[I]

It's who I view is really the winners. I mean, in terms of this disruptive technology theme, look, I think it's a fourth industrial revolution. So it's not just about chips. It's about who do you play in hyperscale software names like Palantir, consumer names like Metta, Autonomous, you can names like Tesla, of course, names like Aqua from a nuclear perspective. So our whole view is this is really what I view as the winners and the second, third, fourth derivatives of the 2 trillion that's going to be spent in the next three years.

[Dan Ives]

Now when you talk about the mechanics of an etf, you're kind of managing, advising, sub advising on the portfolio. When it comes to what goes in or out, how often do you rebalance? If one name falls out of favor, how do you find the replacements? What's the thought process there?

[I]

Yeah, these are all based on our Ives AI 30 years. So these are, these are reports. So as we put them out, you know, three millionaire miles last 25 years. I mean we do that on the ground trying to understand who the winners are. Those come in out of the report. So if we focus on new winners, they come in. If someone I believe is now maybe like from a technology perspective, engineers showing companies shown that they're not performing, then they come out. So ultimately it's really, this is dynamic every quarter and look and that's investors around the world have relied on us in terms of tech. But when I view the revolution is trying to identify the theme and the winners and the ways to play. You know what I view is probably the biggest theme we've seen the last 40, 50 years.

[Dan Ives]

So if this is that fourth industrial revolution and you mentioned kind of around the world and global it, most of that is the us there's no doubt about it. It's maybe quantitatively so it's not just though in the US there's international plays in AI as well. What's the thinking there?

[I]

Yeah, I mean Baidu Alibaba, I mean because our view is that you have to have China exposure when it comes to AI. Look, there could be more international, you know, over the coming months, over the coming years. But, but this is as I talked about. I mean this is second inning of a nine inning game. And when we look at the revolution, we're now just starting to see it go from Godfather of AI gents and Nvidia to software to the use cases. And I think that's why what makes me so excited is that this is something that's going to be going on for the next five, ten years. A theme.

[Dan Ives]

And before we let you go, one more quick follow up. Before we let you go, what do you think among those industry groups is the biggest driver of the AI trade going forward?

[I]

I mean to me it's software. Because when you look at names like massive AI pound tech here, you know, you look what we're seeing across hyperscalers in terms of software, you know, Microsoft, one of our top picks, the use case phase is now just starting to play out. And that's why I think that's something, that's why I think you're going to see tech new all time highs, you know, going to the rest of the year. It's AI driving it. And I continue to believe in this AI party. It's only 10pm and the party goes.

[Dan Ives]

To 4am all right, 10pm 4am Scott, my thanks to Dan over here. We're going to continue this entire conversation conversation [e-mail] join will be debt. Dan will be joined by Todd Rosenbluth, the head of research over at vetify. So a lot of stocks to pick in those names. Scott, I'll send things back over to you guys.

[Scott Wapner]

All right, Dom, thanks so much. Appreciate that. Up next time for the halftime mid year report cards. Oh, we're going to break down the biggest winners and losers in the committee's portfolios just after this break. All right, report card time. Biggest winners, biggest losers, year to date. I say year to date, not necessarily when the specific committee member got into the name. So keep that in mind. I'll try and point some things out to you to give you more on that. Eurofins your best, up 38%.

[Carrie Firestone]

Yes.

[Scott Wapner]

What is it?

[Carrie Firestone]

It's a European testing company. So in Europe there's lots of regulatory requirements on testing of food, drugs, everything from makeup to agricultural products. And Eurofin does that. Its biggest single country is the United States, but it's a European, it's Luxembourg company. There's, it's a, an ETF. It's up 38% and we bought it after it came down fall in Covid. So we've owned it for a few years and it's been a very good stock this year.

[Scott Wapner]

Okay. Among your winners, Joe Crowdstrike, Uber and Netflix all have had tremendous years. I said what I did at the top because Amazon's a perfect example of this. Amazon's down 3% percent year to date. You hold that stock. I do. You bought it at 191 when I.

[Joe Terranova]

Bought it in February in the sell off. Actually bought it at 194.

[Scott Wapner]

194.

[Joe Terranova]

I remember saying at the time the ETF didn't hold a position and I wanted to be in Amazon because we cited before with AW.

[Scott Wapner]

You bought it at 194. Today's at 215. Yes. Year to date, not good for you. Good.

[Joe Terranova]

Staying with the position. Other two names that I have, Docusign and Zoom. Both those names are in the ETF I feel uncomfortable getting out of those positions personally, when the ETF maintains it. I'll tell you this, though. Last earnings report for each of these companies were a complete miss.

[Scott Wapner]

All right, Jimmy. Year to date winners, now. You know what? Let's just skip the losers. I'm just kidding. MP Materials up 96%. Oracle up 29. Visa up 14.

[Jim Leventhal]

Well, MP is one I don't talk about too much. And I put this on about a year and a half ago.

[Scott Wapner]

Stock's at double.

[Jim Leventhal]

Yeah, I don't control the curriculum here. Your Honor, I respond to the question, raise your hand.

[Scott Wapner]

I'd like to talk about this name expressing it.

[Jim Leventhal]

Okay, okay, okay, mp. Let's talk about it.

[Scott Wapner]

All right. Let's do it.

[Jim Leventhal]

Look, the reason that I bought this 18 months ago was for the strategic reason that is showing up right now. It's a rare earth element miner and refiner, and it's now starting to build methods magnets for end users like General Motors that are having problems getting the same from China. It is being referred to as Western Champion, and I think that's absolutely right. It's being reflected in the share price. What else you want to talk about?

[Scott Wapner]

Well, we said Oracle, as part of. You already talked about that. We did. Visa, which is up 14% year to date. Carry UnitedHealth is down 38.5% year to date. I think people are pretty familiar with the story at this point.

[Carrie Firestone]

Yeah.

[Scott Wapner]

Why are you still. Still holding it?

[Carrie Firestone]

We hold it and we actually bought some more right at the bottom because we think that these are structural changes that are not going to last, that they are fixable, that they're going to have better Medicare reimbursement, better Medicaid reimbursement, and that the company is going to recover.

[Scott Wapner]

What you mean you bought some more at the bottom? The stock looks like it's at the bottom.

[Carrie Firestone]

Right.

[Scott Wapner]

We just showed the chart.

[Carrie Firestone]

So you're right. In the past couple of weeks when the stock had these big jump downs after they reported earnings.

[Joe Terranova]

Yeah.

[Carrie Firestone]

We added a small position. This only a 11 and a half percent.

[Scott Wapner]

I get it. But, you know, don't put me in the spin zone.

[Carrie Firestone]

You're right. You're right. We believe that it's fixable and that they're on the way to making things better at United.

[Scott Wapner]

All right. Good stuff. What do you say?

[Joe Terranova]

I think this is. Is a valuable exercise for all the viewers to be doing. And the reason that you want to do that is you identify what your winners are and your losers. And in 2025, momentum is one of the strongest factors. When momentum is a strong factor, that generally means you have a healthy market. Think about 21. Momentum rolled over and the market followed along. This is a good exercise. Everyone should be doing it. Stay with winners, shed the losers.

[Scott Wapner]

All right, up next, Santor Tolle, speaking of winners. He's with us for his midday word. Next, senior markets commentator Mike Santolia at post nine right now with what you call the rise and grind market.

[J]

That's what it had been or maybe it's grind and rise because that's the manner in which it's been going higher. And the question was really did Friday knock it off course and destabilize that comp mentioned on Friday that even the initial pullback you didn't even violate like the 20 day moving average, that's short term uptrend. You didn't really cross any significant tripwires. That said, the market was, was now out of gear. Now we've gone back to last week's highs almost exactly and we stalled there and kind of hanging out. So I guess it sort of brings us back to where we were, which is the markets had a great run, it's priced in some good things. It's probably going to need a little more to get past to the old highs which is only not even 2% up from here. But it shows you that it's able to shrug off some of the geopolitical noise if in fact it doesn't come through punishing oil prices.

[Scott Wapner]

You know, Fed meeting is going to be critical in terms of what to listen for more than what they're going to do. Yes. Maybe they give you, the chair does an idea of what could lie ahead when the next time we're going to hear from him is in Jackson Hole.

[J]

Well, late July.

[Scott Wapner]

Oh it July.

[J]

So it's the very end of July will be the last meeting nonetheless six or seven weeks from now. And I think that, you know, there's a chance for a wider divergence in terms of the dot plot. You know, I think you've seen some decent inflation prints. Maybe it enables some dovishes to make its way in there. But I guess, you know, people, they're still going to try to wait and see. And I don't think anything that's happened since the last meeting has, has moved them off that idea that they have the luxury of waiting. You know, at some point maybe it becomes less persuasive when they say policies in a good place. But I think he's going to say it again.

[Scott Wapner]

Yeah, I'D be curious. I assume he's going to be asked about the moves in the bond market.

[J]

Sure.

[Scott Wapner]

And his thoughts on the way rates have traded, why they have, and that'll be key to listen for as well.

[Jim Leventhal]

It will.

[J]

Usually he's not too alarmist about it, I think because the functioning of the bond market has been fine and haven't had real trouble with auctions. Also 10 year, as much as it has sort of gotten people's attention, it's kind of in the two year range and hasn't really bumped above that.

[Scott Wapner]

All right, thanks, Michael. See in a little bit we'll do finals next.

[Jim Leventhal]

Sam.

[Joe Terranova]

Are you following the Halftime Report podcast?

[Jim Leventhal]

What are you waiting for? Look for us in your favorite podcasting app.

[Joe Terranova]

Follow the Halftime Podcast now.

[Scott Wapner]

See on closing bell, 3 o' clock Eastern Time today. Adam Parker, Mohamed El Erian, Brian Levitt, Samir Samada and Jeremy Cotter is with us too as we continue to talk about the AI arms race. He's a pre IPO Facebook employee and he has a lot of thoughts on where all of this is going. So we'll do that at three. I hope you'll join me then.

[Jim Leventhal]

Farmer Jim Disney Joe, here's some numbers for you. Up 7% year to date, up 20% over the last 12 months. I mean, don't look now, the stock is actually breaking out. It's 1% from a 52 week high, which it set last week. Don't look now, it's breaking out.

[Joe Terranova]

It's cold, Mom.

[Carrie Firestone]

Momentum, Terry First Applied Materials, Amat is also a stock that is breaking out like Jim's. And we think that the Runway is long for these companies. With the business booming.

[Joe Terranova]

Jyoti Vistra Energy Utilities, similar to Constellation Energy, I think these stocks continue to press higher.

[Scott Wapner]

Okay, stocks are hanging in there. Dow's up 350, NASDAQ to 80. That's a one and a half percent. We'll watch all of this, of course, and take you through that final stretch. We'll keep our eyes on what's happening in Canada today with the G7 trade obviously high on the docket for conversation. And we'll follow all that and I'll see you in a few hours. 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 Our state has changed a lot in the last 140 years. We know because MultiCare has been here guided by a single making our communities healthier that comes from making courageous decisions, partnering with local communities to grow programs and services, and expanding healthcare access to those who need it most. Together, we're building a healthier future. Learn [e-mail].