Joe Terranova (2:06)

I think we're seeing the consequence of elevated volatility and it's been that way since the beginning of the year. You use the word momentum. Momentum is trying to find what will be the next trend establishing itself. Interestingly enough, it looks like bitcoin and crypto currencies is where that Next trend ultimately is going to be momentum remains entrenched in precious metals, gold, silver. That's not a recommendation to go buy them because I sold out of the gld and I think they're extended small caps. The Russell, you still have momentum in place there as well in some of the semis and certainly energy and materials. But it's the type of volatility that's suggestive of capital not really leaving markets, but more reallocating to different places. And it feels a little bit uncomfortable because it's moving out of the familiar winners in 2025, the Mag 7, some of the financial names and it's going to place like materials and energy, where we were under allocated last year. So I think more than anything else it's elevated volatility and I think we all expected that.

Frank Holland (3:12)

Yeah, look at the VIX right now. The vix at almost 18. So a bit elevated from recent days. Not historically elevated, but certainly from recent days. Kerry, coming over to you. As we kind of see these fits and starts in the market we mentioned, the markets have been pretty much flat over the last two months. You look at the max seven, they have been flat down about fractionally a quarter of 1% over that time. How do you view the fact that we're seeing those stocks that really dominated the market flat over that time, but other areas like materials industrials seem to be moving much higher?

Kerry Firestone (3:38)

Yeah, I think, Frank, what we're seeing in the market right now reminds us somewhat of what we saw in April in that there's there's fear and there's concern, as we saw with tariffs right now there is fear and concern. When you hear the type of rhetoric from Washington about caps on oil prices, drug prices, credit card interest rates, what's going to happen with defense stocks buying in their shares to tech companies have to give revenues or profit to the government for making a deal to sell chips in China, whatever. A lot of concern about profitability, a lot of concern we had about tariffs. It turned out that we sort of worked through the tariff situation and the market was up 18% last year. If you sort of figure out a way to put play ball, the bark is worse than the bite. So it could be that we're having this, I would say slight version of, of a panic. It's very small right now. It could expand and that a month from now, two months from now, this is all past and we're back on a road of recovery because earnings were good last year, up 14%. Earnings could be good again this year.

Frank Holland (4:52)

Yeah, for this quarter the estimates above 8 and a half percent. Yeah, we've seen some weakness in recent days. But Shannon, coming over to you. Well some of else you're saying it's.

Kerry Firestone (4:59)

A 10 fourth quarter could be okay.

Frank Holland (5:02)

You're saying you're optimistic it's going to be over the.

Kerry Firestone (5:04)

Yes.

Frank Holland (5:04)

Sharon come over to you. Are you worried about earnings? You're worried about profitability? These companies in Q4, do you think that's what's weighing on investors minds or is it also that pending Supreme Court decision that many of us thought we might get today that could change the kind of picture when it comes to supply chain inventory and so many other things?

Shannon Sakosha (5:22)

I want to take a big step back actually and look at the number of things that have happened over the last two weeks and I think that if we went back a year ago today, we would see the market off significantly more than we're seeing it today. And I think because number one I think there is a bit of policy fatigue that's happening in terms of announcements from Washington D.C. i think there are questions about the actual implementation and execution. There's no better example of that than tariffs. And so I think that what's happening from a policy perspective there are questions about if these things can actually be implemented and they likely will be diluted from sort of the top level narrative. Number two, I think that from an earnings perspective the rotation outside of technology and utilities and you know, very AI specific trades to other areas of the market is based on an expectation of accelerating earnings growth in those other sectors. And so we're just at the front edge of that however. Right. A lot of that is baked into the second half of the year in terms of that year over year improvement in earnings. I think the most important piece for for investors to look at right now is that this broadening trade is is well beyond just adding small and mid caps to the mix or adding some of the sectors that that Joe talked about that have underperformed. It's outside of the US as well. It's emerging markets. And so I think that one of the things to really think about is that if you're not globally diversified today, you're not exposed to some of these more cyclical sectors. I think that's where you need to be focused on because I think if you're waiting until you know, March, April, May to wait for that acceleration of earnings growth in the second half of the year, some of that's going to be priced in already.

Frank Holland (7:01)

Steve, are you seeing things again? Markets at their session lows right now, as we get big bank earnings, volatility ticking up a bit. Obviously there's a lot of global issues going on, also some domestic issues, among them the investigation of Jay Powell.

Steve Weiss (7:14)

Yeah. So there are so many different points to worry about in the market where. Where I think there's reason for concern. So imagine yourself, here's the backdrop. Badge yourself in a rowboat, say, and there are four people. You're all standing, you all go to the right side of the boat and it gets a little rocky, it gets a little unstable and you're wondering, is it going to tip over or is it going to right itself and. And smooth sailing. So I think we're on the right side of the boat. Everybody's bullish. So many are saying, I'm not picking on, because they may be right. This is the best environment ever to invest. You've got to accommodate a Fed. You've got renewed growth in the economy. And I'd say I'm not so sure. So what I see is that investors are finally waking up to the fact that. That Washington's not that helpful. They're essentially attacking capitalism by mandating or trying to mandate that companies, oil companies, invest in Venezuela despite the profitability or the risk those assets is attacking capital capitalism. By the Mini Me, Trump going after homebuilders and saying, I don't want you to do buybacks. Saying, I don't want you to buybacks. Defense, what's going to be next, what industry next? And then you take the war on every front where the administration came in on the promise that we're going to mind our own business, let others mind their own business. You've got Iran, which would drive oil prices up, got Venezuela, you've got who knows what and the ongoing battle with China. So there's enough there to worry about. So the cross currents are that you've got yields which are down today, a flight to safety, but they really held steady because you don't know whether it's going to be increased inflation when you put a puppet in that's running the Fed right, or if it's going to be declining inflation still because of what we just saw in the numbers. So the bottom line for me is not putting any new money in the market. My positioning is the same as it's been. I'll keep it there. But I do think every day about raising more cash.

Frank Holland (9:22)

You know, it's funny you say that. Goldman out with a note first off, saying they're giving a nod to the increase in volatility and Joe and everyone else. I want to bounce this off you, but since you hit us with the robot metaphor. He has a metaphor. There are times to go for the gas, there are times to go for the break and there are times to do neither. My instinct is right. Judgment over the next few months is door number three, which is to do neither. Do you see it that way? Is now the time to stand pat? And also I'm not sure if that decline in yields was a flight to safety. We got two inflation reports that were better than expected as well. I mean, wouldn't that lead yields to go down as well?

Steve Weiss (9:51)

No, it would. But my point is that over the last few months, because of the decision the Fed.

Frank Holland (9:56)

Look, we know who every door number three. You're going to, you're going to hold, right?

Steve Weiss (10:00)

I'm holding steady now. Also on the, on the banks, we saw them sell off. That's not a reason for today. We see that every quarter. Right. And I wouldn't be surprised to see the market sell off even after a good quarter, which is expected because we've seen that periodically. So look past those windows and I'm at door number three.

Frank Holland (10:19)

Joe, you were nodding. Are you at door number three? To just kind of stand in pat, at least for the near term.

Joe Terranova (10:23)

Volatility is, is hard and it's a different environment. It's going to be a different environment than we've seen in 24 and 25. It just is. At the end of the year. I did do some selling. I haven't done very much in the market personally other than I bought Merck and I bought yesterday, I bought the oi. So it's energy, it's health care, traded some futures around. But I kind of agree with that. You're kind of right now a little bit on your heels looking for some tactical opportunities if ultimately you can find them. I said before it looks in the near term like bitcoin is probably developing into the strongest near term trend. That's not my thing. I'm not a cryptocurrency trader or an investor, so I'm going to let that play out on its own. But I don't see very much in front of me right now that gets you excited about a tactical opportunity.

Steve Weiss (11:10)

There's one more point I'd make. Sorry, Carrie, let me just chop quick. One is that, is that valuation is so high you'll need a meaningful drop and that's maybe 10% in the market before you start coming in and saying that valuations have been de risked.

Kerry Firestone (11:26)

Yeah, I think One of the points, and Shannon said it quite eloquently is that we really have to think outside of just, you know, mag seven big tech names. That's a trade that has worked over the last, I mean moving outside of them over the last several months and people should continue to do that even if, and most, most professional investors are underweight in these big tech names anyway. Very few people are overweight. Apple and Video, I mean you add them all up, it's 50% of your portfolio. But even if you're underweight, you can take some cash if you have it on the sidelines or even if you're willing to take the capital gains or for nonprofits, just sell and invest more broadly, whether it's overseas or in industrials, some of the materials, I think that's a reasonable trade to make. Health care started to work in the third and fourth quarter of 2025. I think should continue to work.

Frank Holland (12:25)

You know, we're talking a lot about this two month period. The market close to flat but tech itself, it's actually been down about two and a half percent over that time. And speaking of tech, tech stocks are leading to the downside today with software under pressure as concerns grow that is displacing a number of those names are seeming Modi has much more in this Seema.

Frank Holland (12:40)

Well, Frank, in the last 48 hours there's been two major announcements that have really rocked software stocks. First, anthropics cloud unveiling an agent that can basically automate basic tasks similar to what Salesforce's agents are trying to accomplish. And then yesterday Apple launching a studio of design apps that are a lot cheaper than Adobe's existing line of products. These two announcements Frank, are amplifying concerns around competition that have already pressured shares of Adobe which have fallen about 26% in the last year. And then their Salesforce now down 10% in 2026 on track for its worst start to the year since 2020. Two other names that are seen as vulnerable to AI when we have conversations with analysts Asana HubSpot Elastic, which focuses on robotic automation. And as more tech heavyweights launch these AI agents, the call center names like Five9 and Nice have been front and center. A couple of catalysts now to watch in addition to earnings. Well, CEOs will have to defend their their products and show that is not displacing their business. Further signs of M and A in consolidation following a string of acquisitions by Palo Alto Networks and IBM. That's something to continue to look for. And OpenAI's next fundraising round. Analysts say if it's bigger than expected, that would suggest it's got the capital to continue to work on apps and products that take aim at the business customer which is so crucial to software's bottom line.

Frank Holland (14:01)

Crank, rcma, Modi live at CNBC headquarters sema, thank you very much. All right, so we're seeing tech under pressure more broadly. We're showing the board right here a lot of red on this board. Oracle is one of those names. But today Oracle actually got a pretty solid upgrade or excuse me, maintained, overweighted, KeyBank 300. Joe, you own this one. Carrie, you own this one. Oracle seems to be at the center of. So shaking your head why we sold.

Kerry Firestone (14:25)

It on the list. Done for you.

Frank Holland (14:27)

Okay, yeah, apologies. Joe, I'm going to come over to you. You own this one to sell some for me.

Steve Weiss (14:33)

Apologies and congratulations.

Joe Terranova (14:35)

Look, soft software right now is in a very punishing downtrend that I talked last week about the potential for Oracle. It was trading around 205. It looked like it might have a little bit of a technical breakout that failed. So on a, on a daily basis I'm going through the software holdings that are maintained retained in the etf. I'm observing them, none of them look really good. There's one name, Octa. Octa appears as though it potentially is bottoming and could be rebounding. But across the board, other cyber names, Fortinet, CrowdStrike, Palantir, other software names like ServiceNow, Workday. These stocks don't look good at all. And you mentioned where technology on the year is. Think everyone, if you would for a moment. Where would technology be without the strong performance we've had so far from semiconductors. And there is a clear trade that is going on in the speculative hedge fund community where they are long semiconductors and they are short software. And a lot of people, myself included talked about coming into the year, maybe you had some mean reversion that trade. You just have not seen that at all. And that's indicative of an environment for software that's really troubling.

Frank Holland (15:51)

All right, Shannon, come over to you. Just your view on the cyber trade. Cyber even traded lower than broader technology as over the last two months. And then today we got a report that Chinese firms are telling, excuse me, Beijing's telling Chinese firms to stop buying US and Israeli cybersecurity stocks. That seems to be another thing that's weighing on the sector. But just your view on cyber overall.

Shannon Sakosha (16:10)

Again, I think longer term trends on cyber continue to be very supportive as we move through again as software companies potentially use, lose control of that, of that user interface. Right. That that shifts to AI businesses are going to be increasingly concerned about what that means in terms of security. I think anything that relates to China us, you know, potential trade issues, that's always going to weigh on names at any, on any given day. I think longer term, however, the need for cyber is becoming even more pronounced. And I would argue that in a geopolitical climate such as the one we're living in right now, cyber attack becomes even more imperative to prevent given the fact that it can be so, so disruptive for businesses. So I'd say there's, you know, kind of put aside kind of China US that's always going to weigh on names whenever they're, you know, in the, in the crossfire. I would say longer term, however they need for cyber as part of that enterprise stack is not going to be eliminated. And so perhaps we're just getting caught up in that software versus semi debate.

Joe Terranova (17:13)

I just want to follow up a little bit on what Shannon's saying here. It's important to always think about positioning. Everything that Shannon is stating that has been the thesis. We've all talked about it. We all speak bullishly about the need for cyber and cyber spending over the coming years. But now think about positioning and how positioning affects markets. And it's very clear that positioning is long and somewhat trapped in that sense because these stocks are just not responding to the bullish thesis that we've all communicated over the last 18 months. And you have to factor that into your investment decision. So if you are thinking to stepping into that trade now, let it unwind a little bit, let some that bullishness, let it be neutralized before you go take position.

Steve Weiss (17:56)

Well, I think part of that issue is that on cyber and the reason I haven't been in, you know, I was in a couple of years ago, valuations still are not attractive. The valuations on these stocks are egregious. So you've seen some disappointments in various quarters and that just, I think puts people back on their heels and saying, look, they're unreasonably valued. Why should I risk it? It's, it's, you know, we have underspent China by maybe a multiple of 100 times on cyber. It's ludicrous and we haven't woken up to that. You look at the DoD budget on cyber spending, it's really nothing relative to the entire budget and the importance of it. So we do have to spend a lot more. The question is where are you going to do it? Wait for the stocks?

Joe Terranova (18:43)

I think, I think we're saying the same.

Steve Weiss (18:44)

Yes.

Joe Terranova (18:45)

Because you know what's happened too is people have just ignored the valuation and basically have said no. Okay, cybersecurity, we want to invest thematically around that. And you have to factor that into your decision when you're investing in these positions or if you go to invest now. Just understand the environment that you're investing in and understand it could probably be a little bit more punitive for a prolonged period than you might be comfortable with.

Frank Holland (19:09)

So, Shannon, you want to say something? Can I ask you, do you see any parallels to the health care trade last year? It started off very slow last year, it accelerated at the end of the year. And it's very similar to cybersecurity. You're going to need it. It's going to generate revenue at some point just with the direction everything's going. Any parallels there? And the potential for a catch up trade on the back end of this year when it comes to cyber, there could be.

Shannon Sakosha (19:28)

I think what it comes down to though, Frank, if you're, if you're AN S&P 500 CEO or CFO in the earnings over the next couple of quarters, are you going to amplify your cyber spending or are you going to amplify your AI spending? And I think it comes down to there's a kind of a narrative around that. You know, from an enterprise perspective, companies could still be accelerating or continuing their cyber spend, but they're not going to be talking about it in this environment. They're going to be trying to put their flag in the ground on what they're doing in AI because that is what has been rewarded by markets over the last couple of years.

Kerry Firestone (19:58)

Yeah. Also we had an enormous rerating of health care stocks. So most of them were trading well below the market multiple. If you looked at the earnings generating companies in biotechnology and in pharmaceuticals, they were trading in the kind of 11 to 15 range, which is very different from cyber stocks as we discussed.

Frank Holland (20:22)

Let's move on to financials. Take a look at the action there. We got some earnings reports earlier today. Some kind of, I guess, mixed reaction to what we heard from there. Carrie, you're nodding. As I say, kind of mixed reaction. What was your take on the earnings? Was there one bank in particular that stuck out in your mind as one that you've, that made you feel very bullish about the financial space today?

Kerry Firestone (20:39)

Oh, you know, financials had such a strong year last year. I think it's Hard to be very bullish when you looked at strategists opinions of what sectors they are very bullish about. For 2026, I think financials might have been number one for the majority of firms who commented. And that makes me nervous. You know, they had a good year. Everybody knows there's going to be more deals. Everyone knows with valuations and the need, I think, for some of the venture capital firms to take some money off the table and try to really bounce the IPO market, it's going to be good. I just don't know that I would rush into the banks right now until we see, you know, they get a little bit, bit more of a pullback, honestly.

Frank Holland (21:25)

Well, I said mix because we're looking at bank of America beats on the top and bottom line. You're looking at Citi beats on the top and bottom line. Wells Fargo. There were some misses, but when you look at the analyst reports, a lot of them were very positive about some of the results. Specifically when it came to investment banking was one area that we saw some bright spots. Steve, I'm going to come over to you. What's your view on financials right now? Is this still an area, a cyclical area that you're feeling confidence in?

Steve Weiss (21:49)

Does it.

Frank Holland (21:50)

Is this maybe one part of the market that does need the rate cuts to come in?

Steve Weiss (21:54)

I'm still positive on them. Of course, my exposure is in Goldman and it's one of my largest positions because of how it's moved since I've owned it. I don't see anything changing. I do see rates that are at least going to hold steady for a while. I don't know how much they're going to come down. Maybe we get another cut this year, maybe two. But I also believe that there's such a pipeline of transactions to do and you'll need a cooperative market to do it. But that's just going to generate quite a bit of of revenue for the banks. So I continue to be positive on them. Frankly, I'm not unhappy to see them come down post earnings. It's a typical event post earnings, but because it got a little frothy there, so. So I'm still there. I have no interest selling any part of gold.

Frank Holland (22:41)

So kind of going full circle. Last year, volatility really helped the banks. It looks like we're on pace for more volatility this year. Is that a good setup for the banks going forward? I mean, with just so many issues. The SCOTUS ruling on tariffs, what's going on in Iran, what's going on in Venezuela. What could be going on with the Fed? Not only Jay Powell, but there's also at least a Cook ruling that we're waiting on. I mean, there seems to be a lot of issues that could create volatility and give a boost to the wealth management business of a lot of these firms.

Joe Terranova (23:05)

Well, let's hear from Goldman Sachs at Morgan Stanley Stanley. I think Goldman Sachs is reporting tomorrow morning, as is Morgan Stanley. They're the best at what you're describing. I also think it benefits the exchanges tremendously. I talk about that frequently. And whether it's the cme, whether it's ice, whether it's interactive brokers or Charles Schwab, they are all in bullish trends and benefiting from the type of environment that we're talking about. I don't think that environment is going to change. I think the volatility is actually going to elevate even more. So you probably want to enter CME into the conversation.

Frank Holland (23:37)

I want to add one more name in there, Robinhood. That's one that you own. Is that an area of financials that you think you want to drift into and maybe away from either the big banks, the regional banks?

Joe Terranova (23:45)

Well, I don't think. I think it's different in terms of. You don't want to say, okay, I want to own a money center bank. I want to own Robinhood. I think you're grouping Robinhood in the names that I mentioned as it relates to the exchanges. But you're also going to get the cloud clear benefit from cryptocurrencies lifting. And that's what's happening early on. Robinhood is not specifically tethered to cryptocurrencies, and they've really brought in a very strong bench of intellectual capital to diversify the business model. And they've excelled at that over the last 18 months and they're being rewarded for it. So I think it's a little bit more. I think they stand right up there with the other exchanges. So I left the that out in my commentary. Thank you for mentioning don't want to.

Frank Holland (24:29)

Pay too broad of a brush. Point taken. Shannon, give you the last word before we go to break?

Shannon Sakosha (24:33)

Yeah, I mean, I think if you look at financials, I want to really emphasize some of the things that Joe has been talking about in volatility. It's not only kind of increased transactions. There's also kind of growing interest in, in hedge strategies and absolute return strategies and the mispricings and the dislocations that we're seeing in the marketplace that could also amplify transactions dividends as capital continues to flow, maybe from some of the distributions that they're getting out of their private equity portfolio into these strategies that during periods of fiscal and monetary collusion that we essentially saw over the course of the last 10 years or so, we're seeing that break apart, especially with things like, you know, the repricing of the yen, for instance. So there are a lot of ways that this could play out in financials. And I think it goes well beyond just improvement in net interest income and deal increased dealmaking.

Frank Holland (25:19)

I know what I said said, but we're not going to break just yet. We actually have some news coming out of D.C. let's get to our Emily Wilkins on the Hill with much more. Emily?

Frank Holland (25:28)

Hey, Frank. Well, a key House panel has advanced a bill that would ban lawmakers from being able to buy new stocks and will put limits on their ability to sell stocks. Now, this bill did move on a party line vote you had all Republicans voting for, all Democrats voted against because they said the bill simply doesn't go far enough. For example, it allows lawmakers to hold on to stocks and assets that they had when they got elected. But we do know from House Majority Leader Steve Scalise that he does plan to bring this bill to the floor, which means that it will get a first floor vote, first bill that we've seen like this to do so. And you had the committee chair, Brian Stiles says that he does believe he can pick up some Dem votes on the House floor. Now, exactly how bipartisan that vote is going to be will likely decide whether it moves ahead or not in the Senate. So certainly an issue with some momentum here now on Capitol Hill, and we will be following it as it moves through the process.

Frank Holland (26:20)

Frank, Emily Wilkins live in D.C. emily, thank you very much. All right. Coming up next, a fresh committee move. Kerry Firestone is ready with a brand new buy. The trade is straight ahead. More halftime. Back in two minutes. Building a portfolio with Fidelity Basket Portfolios.

Steve Weiss (26:36)

Is kind of like making a sandwich.

Joe Terranova (26:39)

It's as simple as picking your stocks and ETFs, sort of like your meats.

Steve Weiss (26:42)

And other topics and managing it as one big juicy investment.

Frank Holland (26:50)

Now that's pretty good.

Joe Terranova (26:52)

Learn more@fidelity.com baskets Investing involves risks, including risk of loss.

Frank Holland (26:57)

Fidelity Brokerage Services, LLC Member nyse, SIPC oh, could this vintage store be any cuter?

Frank Holland (27:06)

Right.

Kerry Firestone (27:07)

And the best part, they accept, discover.

Frank Holland (27:09)

Accept discovery in a little place like this.

Frank Holland (27:12)

I don't think so.

Frank Holland (27:13)

Jennifer. Oh, yeah. Huh.

Kerry Firestone (27:14)

Discover's accepted where I like to shop. Come on, baby, get with the times.

Frank Holland (27:19)

Right, so we shouldn't get the parachute pants.

Kerry Firestone (27:22)

These are making a comeback, I think.

Frank Holland (27:26)

Discover is accepted at 99% of places that take credit cards nationwide. Based on the February 2025 Nielsen report.

Frank Holland (27:33)

Not every sale happens at the register. Before AT&T business Wireless checking out customers on our mobile POS systems took too long. Basically a staring contest where everyone loses. It's crazy what people will say during an awkward silence.

Kerry Firestone (27:47)

Now transactions are done before the silence takes hold. That means I can focus on the.

Frank Holland (27:52)

Task at hand and make an extra sail or two. Sometimes I do miss the bonding time. Sometimes.

Frank Holland (27:58)

AT&T business Wireless connecting changes everything. And we're back when? Halftime. We got a new committee move in the material space. Kerry, you bought Lindy.

Kerry Firestone (28:11)

Yes. So this is a UK based company. It's the largest producer and distributor of industrial gases in the world. So we're talking about oxygen, nitrogen, argon, etc. These are mission critical products that are used in industrial production, in health care, also in semiconductor manufacturing. Semiconductors require very specified and purified gases. So the stock had fallen in the last quarter of 2025 as the risk on trade took hold, went from the 30 level to 22 times. And so we bought some stock there and we think there's a very strong growth trajectory of at least 10% per year over the next several years.

Frank Holland (28:55)

Yeah, so far a big start to the year for materials more broadly. How closely is this levered to increase production and manufacturing here in the US or globally? Obviously here in the US we're in what a lot of people see as an industrial and manufacturing recession.

Kerry Firestone (29:07)

So it's a cyclical company for sure. And as industrial production picks up and we're seeing that in GDP growth continues, that's good for this company. And you know, for sure if we have a big cyclical decline, that would not be favorable, but we're not expecting that. And this was an opportunity again to diversify outside of communication, services and technology.

Frank Holland (29:30)

All right, material sector itself up over 7% so far year to date. Gold's been a big part of that story. Joe, coming over to you. You own Newmont. You also own a company called Cortiva. What do you make of the metals rally extending again today? Gold and silver both higher after hitting records. Gold was actually an intraday high yesterday, but silver closed at a record.

Joe Terranova (29:47)

It's the purest representation of momentum you're going to find in the marketplace right now. And it's a momentum play that's being embraced by the retail community. All you have to do is look out on social media and you'll see that fundamental validity is there as it relates to silver. With the supply deficit that's been in place now for the better part of the last several years, I have not managed this trade well. I think Steve is in the gold. You did mention Cortiva do not rule out agriculture assets in 2026. Owning names related to potash and agriculture. Agriculture mosaic making a little bit of a move today. I think that's up about 6%. I think agriculture in 26 can participate in what looks like a commodities rally.

Frank Holland (30:32)

Shannon, what do you make of this commodities rally was kind of interesting. We saw the pie today better than expected. Commodities obviously a factor in there. And despite this big rise that came in a bit lower than expected. Just what do you make of this trade right now? Do you see it as sustainable going in to the rest of 2026?

Shannon Sakosha (30:46)

Historically, I wouldn't say that if you're entering into to a period of expected disinflation that you would be looking to buy commodities. But I think that there are a number of different factors to Joe's point taking Joe did a great job of articulating on agriculture, but if you look at industrial metals, precious metals, and I think we're going to talk a little bit more about energy, you know, there are some drivers here in terms of global growth reacceleration. There's also a feeling that from a, from a diversification standpoint, adding kind of real assets exposure into your portfolio can balance out some of the growth risk that is in other parts of the market, particularly the US equity market. So we see this as a really nice complement despite the fact that it might not be intuitive to be purchasing commodities in a disinflationary environment.

Frank Holland (31:29)

All right, Weiss, you actually bought the Gold ETF last week. Obviously we all know about gold's rally. So you're buying gold pretty close to a high. Why buy here? What are you saying?

Steve Weiss (31:38)

Because I think it goes higher, that's why.

Joe Terranova (31:42)

I mean, it has gone higher.

Steve Weiss (31:44)

I was right. It's right for a change, in all fairness. No, look, I had raised some cash last year, the end of the year, and I wanted a place to put it. I thought it was a reasonable hedge, frankly. And sure, I never liked buying anything at the highs, even though I read Joe's book Buy High and Sell Higher, which I recommend to everybody. But. But that's why I think it goes up, because there's a lot of nervousness in the market, in, you know, in the world overall. And this is a good place to hang out.

Frank Holland (32:16)

All right. Well, looking at the GLD today, it's up over a half a percent. All right. Time now for the headlines. We're going to be joined by Christina Parts and Evolis. Christina.

Shannon Sakosha (32:23)

Hi, Frank.

Frank Holland (32:24)

Well, U.S. special envoy Steve Witkoff announced today the launch of phase two of President Trump's 20 point plan for peace in Gaza. He says this phase will establish a trip transitional administration in the enclave and begin its full demilitarization and reconstruction.

Shannon Sakosha (32:39)

Wyckoff also warned Hamas there would be serious consequences if it does not return the final deceased hostage in Gaza.

Frank Holland (32:46)

An unspecified number of military non essential personnel will be reportedly evacuated from a key military base in Qatar as President Trump weighs military options in Iran.

Shannon Sakosha (32:56)

It comes after senior Iranian official confirmed.

Frank Holland (32:59)

To Reuters today that Tehran warned neighbors hosting US Troops it would hit American bases if the US Launches strikes in.

Kerry Firestone (33:07)

Response to a deadly crackdown on anti government protesters.

Frank Holland (33:11)

And front office sports reporting today that.

Shannon Sakosha (33:13)

Prediction market Kalshee signed golf for Bryson.

Frank Holland (33:15)

DeChambeau as its first athlete endorser. CNBC also has an agreement with Kalshee. According to the report, DeChambeau's deal includes a TV commercial, live appearances, social media.

Kerry Firestone (33:25)

Posts and much, much more.

Frank Holland (33:28)

Frank to the betting markets.

Frank Holland (33:30)

Back over to you, Christina. Thank you very much, Christina. Partzoneville is live from the nasdaq. All right. Coming up here on halftime, our chart of the day, a big bounce in one area of the market. Trading at 3 months highs, what it is and how to trade it. We're going to have that and much more coming up after this. Stay with us.

Joe Terranova (33:45)

Introducing Fidelity Trader Plus.

Frank Holland (33:47)

With customizable tools and charts you can access across all your devices, try our most powerful trading platform yet@fidelity.com SL Trader + investing involves risk, including risk of loss. Fidelity Brokerage Services LLC Member NYSE SIPC oh, could this vintage store be any cuter?

Shannon Sakosha (34:03)

Right?

Kerry Firestone (34:04)

And the best part, they accept Discover.

Frank Holland (34:06)

Except Discover in a little place like this? I don't think so, Jennifer. Oh yeah, huh?

Kerry Firestone (34:11)

Discover's accepted where I like to shop. Come on, baby, get with the times.

Frank Holland (34:16)

Right.

Frank Holland (34:17)

So we shouldn't get the parachute pants.

Kerry Firestone (34:19)

These are making a comeback, I think.

Frank Holland (34:23)

Discover is accepted at 99% of places that take credit cards nationwide. Based on the February 2025 Nielsen report.

Frank Holland (34:30)

Not every sale happens at the register before AT&T business Wireless.

Kerry Firestone (34:35)

Checking out customers on our mobile POS.

Frank Holland (34:37)

Systems took too long. Basically a staring contest where everyone loses. It's crazy what people say during an awkward silence.

Kerry Firestone (34:45)

Now transactions are done before the silence. That means I can focus on the.

Frank Holland (34:49)

Task at hand and make an extra sailor too. Sometimes I do miss the bonding time sometimes.

Frank Holland (34:55)

AT&T business wireless connecting changes everything. And welcome back to halftime. Let's hit our chart of the day. It's oil rebounding over the past week on rising tensions in Iran and Venezuela up more than 10% today, up over 1%. Joe, you have a lot of oil exposure. What do you make of this upside move? Oil right now sitting at its highest level since October and Also the XLE ETF hitting a 52 week high and.

Joe Terranova (35:23)

The sector is the best performing sector so far year to date. It's built upon the premise that there is a lot of short positioning in the futures market along with in 2025 it was a sector that was ignored and replaced the by utilities. So the combination of those two factors are very powerful and could lead to what I believe would be a significant short squeeze. From a technical perspective, spot oil is approaching the 200 day moving average 6245. It has not spent much time above that over the last six months. That's powerful. So you're getting your exposure here in energy equities. I'm doing it through Valero. And then of course I mentioned yesterday on the show that I bought the OH to get exposure to the various oil services names. I think that's the right play. The etf it maintains Baker Hughes, that has been an outperformer in the energy sector. But clearly right now this is about reversing that bearish positioning in the oil futures market, building strong bullish positioning in the energy equity market. And I think it sustains itself because the concerns related to Iran are not going away, it looks like anytime soon.

Frank Holland (36:41)

You know, to that point. And Shane, I want to come to you about this. JP Morgan out with a note on oil saying in part the limited rise in oil prices even though we're seeing a 10% rise of last week. They say it seems short sighted given that regime changes in oil producing countries, whether through leadership transitions, coups, revolutions or major political shifts, tariffs can have a profound impact on the oil production and also the prices. Agree with that thesis that this upside move 10% over last week, it may be actually underdone.

Shannon Sakosha (37:05)

There's certainly possibility for that. I think when we think about now we have multiple locales where we could see oil disruption and the reality is is that you can say that there is this much oil in the ground in Venezuela and that that could come onto the market and essentially add to the supply over the next couple of years. And there's just a lot of things that need to happen prior to that occurring. There's also a lack of quality in that supply that I think is probably being under appreciated by the marketplace. And so but I think the most important thing is what Joe sort of mentioned in terms of the positioning here. Many investors are likely underexposed to energy at large. And so looking at that as an opportunity, not necessarily from a short term valuation perspective, but looking at it more, more long term, both on the oil and natural gas side, which has seen a pullback that to us makes sense in this environment.

Frank Holland (37:54)

All right, I want to shift to utilities very quickly. BTIG out with a note saying utilities are poised to light up after a multi month consolidation. Saying in part the setup now looks timely with the XLU. It's obviously the utility ETF having pulled back about 10% from highs. I know we have some utility ownership but Shannon, I just want to come back to you very quickly. What do you make of this was such a high hot trade last year with the idea that these utilities was for data centers and it cooled off very dramatically.

Shannon Sakosha (38:18)

I think that this is just the ebb and flow and again part of this is the rotation moving from those specific names to more adjacency adoption. I also think that if you look at utilities, you know, at the end of the day there are some meaningful kind of regulatory and pricing aspects to investing in a utility that need to be taken into account. But there are still, you know, utilities that are going to benefit from this data center. Carrie, you have some exposure here, right?

Kerry Firestone (38:44)

That next step.

Shannon Sakosha (38:45)

Yeah, so I mean I think that at the end of the day some of this is part of that rotation. Some of this is due that you know, utilities historically are not growth stocks. And so perhaps the valuations got a bit out of hand in this trade.

Frank Holland (38:57)

Your view of next era?

Kerry Firestone (39:00)

I think it's a great company that had an enormous spike because because of its sustainability exposure years ago. Then that disappeared and it crashed in crash. But it came down a lot. We bought it then it had a big rise because of the data center connection. But now we all know it's a good utility. It's Flower Florida Power and Light. It's growing, it's regulated gas. But that ensures that they have sustainable growth and, and we all need utilities and it's a business that, you know, we can all understand when you're particularly looking for a little less risk on.

Frank Holland (39:38)

All right, looking at next era right now, up fractionally over last year, up over 20%. All right. Coming up next, Mike Santoli joining us with his MIDDAY word. We are back right after this break. Stay with us. And we're back on halftime. Senior markets commentator Mike Santoli joining us with his MIDDAY Word. Looking at the markets in the red across the board, Mike, what do you see?

Joe Terranova (40:04)

Well, interesting, I wouldn't call it red across the board. And that's kind of the point. You have the indexes under a lot of pressure and none of them are positive on the day. But you have like 300 stocks more on the upside than the downside if you look at the New York Stock Exchange and the nasdaq. So what that means is is we are witnessing basically the best case scenario for the so called broadening trade that everyone claims to want. And I've always said a broader market is not necessarily a safer, more rewarding one. The s and P500 right this minute is where it closed on October 28th. Okay. In that period of time, the equal weights up 5 or 6%, the Russell 2000 small caps up 5 or 6%. Banks are up big, industrials up big. So we've had the cyclical rotation, you've had the broadening. And now it's a matter of whether all of this push pull underneath the market can, can sort of remain relatively painless or if it's going to create other frictions out there. The rotations are getting very whippy. The action in things like silver and now bitcoin are starting to get kind of supercharged. So it's been a really active phase so far. You know, it's kind of worked according to most would hope. But I don't know how we're getting to 7,600 on the S and S and P if the big guys don't start to lead again.

Frank Holland (41:15)

We were having that conversation earlier. Mike Santoli with his MIDDAY word. Mike, good to see you. Thank you very much. All right. Coming up next, the bidding war for Warner Brothers and Netflix's latest offer. Netflix shares pulling back more than 2%. Halftime's back right after this. And welcome back to Halftime. Let's get to some stocks that are on the move. Let's start with Netflix preparing an all cash offer for Warner Brothers, allowing shareholders to approve the bid on a faster timeline. Netflix shares pulling back. Why she owned this one.

Steve Weiss (41:43)

Yeah, look, I think the stock's down today based on the on the market overall. In fact, if you do it for cash, you're removing the arbitrage And I'm not sure there's a big arbitrage play here anyway because of the length of times can take for approval in Europe and in the US which is up for grabs at this point. So I prefer they don't buy them for all this cash. I prefer they put into content and let Paramount sink under the debt load. But that's not the case. But I'm holding it. I do debate whether I should exit or not, just because I think it's going to be dead money, not because I doubt the fundamentals.

Frank Holland (42:16)

Carrie, you had a thought on this one?

Kerry Firestone (42:18)

I just wanted to say this dates me, of course. I followed the entertainment industry in the mid-80s to the mid-90s before I did biotech. And Warner Brothers was the subject of many applications, acquisitions and mergers, none of which worked out if Netflix is buying this for 85 billion or whatever the price is. Because if it's library and because it's a studio, it's a studio already. The library could take 85 billion at 5%. 4 billion is going to buy them whatever content they need from the library to show to their viewers per year. I don't really understand this deal I'm with.

Steve Weiss (42:55)

I agree 100%. I don't get it.

Frank Holland (42:57)

Joe, you're a shareholder. Are you in favor of this? Do you like the idea that they're going straight to cash?

Joe Terranova (43:03)

I don't. I really haven't spoken to many people who are in favor of it. And that's, that's perfectly stated. I agree with everything that Carrie said and Stevens agrees as well. At the end of the month we rebalanced the ETF up until then. Personally, I have to maintain the position. I can't get out. I said last week if I had the ability to need to get out, I would.

Frank Holland (43:22)

All right, leave it there. Netflix shares again pulling back now. Just about two and a half percent down today. All right, coming up next, we got the Uber trade. Shares are set to snap a three week win streak. When you get the committee's take coming up right after this. Don't go anywhere. And we are back. Uber currently on track to snap a three week winning streak. Take a look at shares. They're down almost just about a third of 1%. Joe, you own this one in the Jyoti Shub been trimming recently. Joe, why don't you go first? Your view on this?

Joe Terranova (43:49)

I sold it personally. I think the stock is just kind of in a sideways range. It's been trading between 80 and 100. It goes down to the floor. At 80, it goes up to the ceiling at 100. It's been that way for the better part of the last several months. The story for me personally has been about an improving balance sheet, the free cash flow generation, the diversification that the company has executed on going into delivery. Now we need to hear what the next story is going to be for the company in 26 and 27 before I think it makes a sustained move.

Steve Weiss (44:21)

Above 100 and robotax is getting more competitive. They just came out a statement from Uber that if you want to, you know, you can ride more Waymos in Austin today and book them through the Uber app. So that's good for Uber. As you can see, it's not having an impact on the stock is pretty well known out there. I, I just think it's, it's been dead money. It's going to be dead money and I've got other places to put it. So it's like they'll probably sell next few weeks. I was close selling before but saw this momentum so held on for a little bit. But it's one like Netflix should have pulled the trigger on much higher would it could have account when the deals were announced. When the deal was announced.

Frank Holland (45:02)

All right, we got a move on Uber shares lower. And a programming note, don't miss Uber CEO Dara Kawasha on an all new episode of Leaders Playbook tonight with Julia Boorstin at 10pm Eastern and Pacific. Julia talks with the Uber CEO about how he navigated a turnaround for Uber, transformed his culture and much, much more. All right, stay with us. Final trades coming up on Halftime.

Joe Terranova (45:28)

Are you following following the Halftime Report podcast? What are you waiting for? Look for us in your favorite podcasting app. Follow the Halftime podcast now.

Frank Holland (45:41)

And we are back by the way, markets at session lows. You see the Dow down about a half a percent right now. It's also time for final trades. Steve Weiss, you're up first.

Steve Weiss (45:48)

I'm staying with GLD given my market view.

Frank Holland (45:51)

Shannon.

Shannon Sakosha (45:52)

Oh, that was quick. I'm going to go with material to talk about global industrial inflection and underexposure in most growth portfolios. Here's a, here's an option for that.

Frank Holland (46:02)

Carrie.

Kerry Firestone (46:03)

CNX Natural gas producer. Natural gas prices have gone up 10% over the last year. Finally. And this is a very inexpensive way to play it.

Joe Terranova (46:11)

Jyoti Asset management, exchanges, wealth management, Raymond James is one of the names that I think will benefit and have strong tailwinds in 20, 20, 26 from it. Volatility is not going away.

Frank Holland (46:23)

All right, one more look at the markets before we let you go. As we just mentioned, hitting session lows, we're talking about the major indexes right now. The Nasdaq down about 1 and a half percent, the S&P down 1%, the Dow down just about a half a percent, the Russell Pretty close to flat. But we saw it kind of wiggle back and forth between fairly positive and barely negative throughout the hour. That does it for us. The exchange with Kelly Evans starts right now. You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekday at 12 Eastern only on CNBC.

Frank Holland (46:57)

All opinions expressed by the Halftime Report participants are solely their opinions and do not reflect the opinions of CNBC or its parent company or affiliates and may.

Frank Holland (47:04)

Have been previously disseminated by them on.

Frank Holland (47:06)

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 opinion. Such opinions are based upon information the Half Time 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 introducing fidelitytrader+.

Frank Holland (47:33)

With customizable tools and charts you can access across all your devices, Try our most powerful trading platform yet@fidelity.com TraderPlus investing involves risk, including risk of loss Fidelity Brokerage Services LLC Member NYSE SIPC Member.