← Halftime Report
Halftime Report
Navigating a Week of Volatility 04/11/25
00:47:05
Scott Wapner and the Investment Committee debate another volatile session for stocks following Wednesday’s historic moves. Plus, legendary commodities investor Mark Fisher joins us with his best trade I the market. And, the Investment Committee continue to make portfolio moves amid the volatility, they share all the details.
Loading summary
Transcript210 lines
- [00:00]
Kevin Simpson
A rich life isn't a straight line to a destination on the horizon. Sometimes it takes an unexpected turn with detours, new possibilities and even another passenger or three. And with 100 years of navigating ups and downs, you can count on Edward Jones to help guide you through it all. Because life is a winding path made rich by the people you walk it with. Let's find your rich together. EDWARD jones, Member, SIPC.
- [00:33]
Brenda Vingelo
As America's leading.
- [00:34]
Scott Wapner
Business lender, bank of America is on your corner and in your corner. With $215 billion in business loans and over 3,700 business specialists across the nation.
- [00:45]
Brenda Vingelo
We help businesses thrive so communities prosper. What would you like the power to do? Learn more@bankofamerica.com LOCALBUSINESS bank of America Official bank of FIFA Club World Cup 2025 Copyright 2025 bank of America Corporation.
- [01:00]
Kevin Simpson
All rights reserved.
- [01:03]
Scott Wapner
I'm Scott Woppner and you're listening to CNBC's Halftime Report, the podcast the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in. All right, thanks so much. Welcome to the Halftime Report. I'm Scott Wobner. Front and center this hour, another volatile session for stocks which, given Wednesday's historic move, are on pace to end higher this week. We will debate the markets with the committee. Joining me for the hour today, Steve Weiss, Jim Leventhal, Brenda Vingelo, Kevin Simpson. We'll check the markets. I'm almost hesitant to tell you what we're doing at the very moment because it's been that volatile again. What is green now could be red in 30 seconds. But that's the kind of session and that's the kind of world we're living in right now. Rather than sort of go through all of the stuff that you and everybody else already knows, bond yields are elevated, the dollar, etc. Etc. We're going to get to some of that. I like to think on this show, you guys, all of you are charged with trying to give investors ideas on what to do in volatile times like these, in a volatile market like this, whether you're supposed to, as some say, buy the dip. Many people come on the network and say if you're a long term investor, buy this dip. Others say volatile environment's going to remain, sell the rips, move into other asset classes, which has been harder because there's been almost no place to hide in any of this. Traditional things where some of our viewers, like munis obviously bonds, the dollar, even gold at times has not been the kind of safe haven Play that some people view it to be all that is a lead. Up to you, Kevin, because you have been buying many blue chip names in this weakness. Just give me the philosophy first before we talk specifics of what you saw in this market. That said, now's the time to get my list of the best companies in the world and buy them now.
- [03:05]
Kevin Simpson
Yeah, we've been doing a lot of buying, that's for sure. And the difference between active management and being in an index is that going into this, if you're in an index, your allocation was set, you still have that allocation today. Active managers can be a little bit more nimble. We're not quite as handcuffed. So ending March, we had about a 12% cash position. A couple of weeks ago, we talked about potential for weakness in the market. We were almost joking, like, could it go down 20%? And it did. So we thought at that point, a 20% drawdown gives us opportunity to put money to work. And not getting into the specifics, but just generally speaking, 12% cash, we put six of it to work on the pullback. We still have 6 or 7% cash. Because by no means do we think that we're out of the woods completely, but the combination of being nimble, able to add, what we need to do is be able to provide less downside, help help invest investors navigate the downside, the volatility. And generally speaking, I feel like the upside always takes care of itself over time.
- [04:04]
Steve Weiss
For perspective, 12% cash, where does that stand? Respect.
- [04:09]
Scott Wapner
I was thinking the same thing.
- [04:10]
Steve Weiss
And being cash, and when you have been in cash in periods of dislocation.
- [04:16]
Scott Wapner
That sounds high to me. And I think that's leading Steve to sort of allude to that as well in his question. And it's in cash for an active manager, to me, sounds high.
- [04:25]
Steve Weiss
You're not the asset allocator. Right. You're not saying, I can go into currencies, I can go into bonds.
- [04:30]
Kevin Simpson
You're in equities, fully invested equity manager. And we define that by 90% invest.
- [04:35]
Steve Weiss
Right. So when people invest with you, they're allocating to equities.
- [04:38]
Kevin Simpson
Yes.
- [04:39]
Steve Weiss
So you have limited ability to really take that down. They're not cash allocators. They're not allocating to you for cash management.
- [04:45]
Kevin Simpson
Right.
- [04:46]
Steve Weiss
So back to my original question.
- [04:47]
Kevin Simpson
In a perfect world, I'd like to have 5% cash. That's where we want to run the portfolio. Historically speaking, every time we seem to get to 10%, 11%, bring it back down to that 5%, which is exactly what we did last week, okay, cash builds up again because we're collecting dividends and in this type of volatility we're just writing option premium like crazy.
- [05:06]
Scott Wapner
So I mentioned like you're, you're not, I'm going to get to the names now. You're not looking like way out on the risk curve for some of these names. You're not buying what you think are super high beta names. I mean McDonald's, American Express, Caterpillar, Meta, Apple.
- [05:25]
Kevin Simpson
Well you could say Apple maybe.
- [05:27]
Scott Wapner
Well yeah, lately for sure. But you know what I mean generally, generally speaking you're looking at the, some of the best companies in the world, blue chip stocks that you believe are maybe somewhat of ports in this crazy market storm.
- [05:46]
Kevin Simpson
Well, with the exception of McDonald's, each one of those names was down 30% in about a month. So even more than the broader markets now. Can they go down further? Absolutely. We don't call bottoms. I'm not here to predict anything that's going to happen over the short term. But a 30% drawdown on Meta, 30% drawdown on Caterpillar. What we're seeing with McDonald's a little bit different story, but maybe a trade down for the consumer. Caterpillar obviously is going to be subject to, you know, global issues and I think we can get to Apple separately.
- [06:15]
Scott Wapner
Let's get to Apple now because that's one of the most hotly debated stocks within this market. It's down 26% off of its 52 week high. And let me set the stage as well because literally right when I sat down on this desk moments before our program, our senior producer sent me a note that Jim Cramer has just put out that says quote, I'm wavering on quote, unquote, own, don't trade Apple. That it's now harder to defend Apple stock in the trade war. That's significant coming from somebody like Jim who has made the case for literally as long as I can remember. And I have these words in my head, own, don't trade Apple. Because he says it so often. But this, this is different. The game's different, the goal posts have moved. Should your thinking move like Jim's?
- [07:08]
Kevin Simpson
My thing is not going to change or move like Jim's. But it's nice to see that there's somebody some more opportunities to trade it. In the past 13 years I've sold out of Apple in its entirety 11 times. I trade Apple, I don't own Apple. Most recently in December, we sold it at 247 and a half coming in back on Tuesday at 177. That's attractive for us. On Wednesday on the pop, I wrote a 215 call. Shorts going to expire first week of May, brought in a $30 on it. We trade Apple like crazy. And I think Jim's point is completely spot on. This game has changed. What's happening with tariffs could be devastating. And I'll give you a worst case scenario because we modeled it. What if Apple earns $5 a share? Because that's a real possibility. And what if you bring the multiple down to 25, $125 stock for Apple, we're paying 177 for it. It's probably trading in the 190s right now. We're not buying the whole position. We'll buy it on the way down. But just recognizing that it could go lower. You have to be careful in these markets and you can't get too tricky.
- [08:12]
Scott Wapner
If we had room at the desk, I would say Jim Cramer, come down here right now and talk about this. And if he wants to stand at the end of the desk and have a conversation with us, he's still more than welcome to show up at our table. But I'll leave that to him. You bought more Apple today?
- [08:28]
Jim Leventhal
Yeah, actually yesterday. But you know, it doesn't matter. It's in the context of this. Most long term, great long term investors will tell you that most of the time you're trying to buy great companies at okay prices, good prices. And that is, I mean that's a Warren Buffett ism, that's a Howard Marks ism, and I think it's a Kevin Simpsonism and probably Brenda and myself as well. But you now have this opportunity to buy great companies. And I submit to you that Apple is still great at very good prices. Not going to say great prices. I mean, it's still mid-20s. I get it. But this is an opportunity in the downturn that we've seen to upgrade your portfolio because everything's got smistered here. So why not trade out of the sum of the more speculative things into the companies that are likely to thrive on the other side of any downturn that happens. And we can discuss whether Apple will thrive on the other side of this, given that it's in the crosshairs of the China trade war. My opinion is yes, it will. I don't know how the trade war is going to end. And like Kevin, I'm not calling a bottom either. This thing could obviously go lower. But I look at the prices compared to where they were just four or five months ago for one of the best companies in the world and I am absolutely buying. It's not the only thing I'm buying by the way because a lot of times when we talk about great prices or great companies, we talk about tech. I've been buying Citigroup as you know. Scott also bought Wabtech today. Great industrial, in my opinion bought some AstraZeneca and I think this is interesting because pharmaceutical tariffs are on the come. There is still some bad news to come and yet I look at companies like AstraZeneca or AbbVie or Vertex and I say wait a second. These are companies that are doing great things and they've been repriced for maybe not all, but a lot of the danger in the market right now.
- [10:09]
Scott Wapner
Brenda, you own Apple, you own a lot of these tech names that are substantially off their 52 week highs. Are you in the mindset like both Kevin and Jim that now's the time to actually put some of this money to work?
- [10:23]
Brenda Vingelo
I think it makes sense to add a little bit and as we talked about a little bit yesterday, our, our strategy is not to add all at once but to add incrementally during environment, environments like this because we don't know where the bottom is going to be. But we can look out from a longer term perspective and say is this an attractive entry point for a one year time horizon or more? And I would say yes, there's still a lot of uncertainty but I do think that now is a moment where.
- [10:52]
Scott Wapner
You can add Weiss, you've been among, I think if not the most more recently cautious person on this program. I'm wondering how you're now viewing markets down a lot. We had a couple of really rough days. We had a historic day and then we had another rollover yesterday. None of it in normal sized moves that you generally see. What's, what's your take man? You've been through a lot of markets like this.
- [11:18]
Steve Weiss
So on Wednesday, as bearish and as concerned as I am, not about just the near term but the longer term as we cede our, our spot and I firmly believe this as the preferred trading part, the preferred capital partner to Europe and to China as a matter of fact, they're getting together to hash out policy. I did say on Wednesday that the pain trade and the most likely move will be higher and that was the case Wednesday afternoon. Much quicker time frame than I envisioned. Only give back about half those gains on, on, on Thursday yesterday. So the way I look at it is that that's still the case. As a matter of fact, if Trump does, as he said at his cabinet meeting, he said he can settle all trade issues with all 70 countries in one day. If he goes out and does that in one day, then Mark's off to the race.
- [12:14]
Scott Wapner
Don't you think? As we said yesterday, don't you think, I mean, I've been talking to a lot of people, you know, a lot, a lot of people on the floor here. And I think to a person, everybody says the risk is to the upside. Yeah. And because all it takes is thing from the White House that says the president and President Xi have scheduled a call or top representatives are going to speak. And I believe that you think this market's going to be red and.
- [12:40]
Kevin Simpson
No, no.
- [12:41]
Steve Weiss
And I'm not saying no.
- [12:42]
Scott Wapner
I know, I'm saying it like a rhetorical question.
- [12:44]
Steve Weiss
I agree with you and I agree with them. And look, this is going to be over the next 90 days, a series of small wins that are headline wins but have no substance because as you know, it takes years to negotiate a trading agreement and it takes months to even put together a term sheet for acquisitions that we make of substantially less value. Those term sheets can take six months to do so. So but it's going to trade on the headlines. And it's because there are lots of people sitting in a lot of cash, lots of people that are, are positioned adversely to a market run. That's going to work. But here's what I'd say. I'd say that earnings will also be the test. Now, we've been fortunate. We've had bank earnings which have been good. And you know, as you would expect, the Jamie Dimons of the world, they are, they look at it, they can see the downside. But neither are they doomsayers. So they're not there to rattle investors or rattle the market. They're there to give just really a perfectly spoken word and comment about here are the risk we see, but here's what we've done and we are well positioned to handle any adverse events.
- [13:54]
Scott Wapner
Sure.
- [13:54]
Steve Weiss
So I do think that the, that the pain trade still is to the upside, particularly on the weekend when there's no news coming out. I won't go into the reason for it.
- [14:03]
Scott Wapner
Right. Even so, you know, there are plenty who are suggesting that, you know, the game has changed, that a lot of damage has been done. And even if there is a positive development, that you've left a lot, lot of rubble in your wake here, I'm.
- [14:20]
Steve Weiss
Still at reverting closer to the 25 year average multiple which 16 times, which could put you below 4,500.
- [14:28]
Scott Wapner
I wanted you to listen to what Larry Fink said on the network earlier. He says he thinks we're still, you know, we're already in a recession.
- [14:35]
Steve Weiss
Yep.
- [14:35]
Scott Wapner
He did talk about rates too, which I thought was interesting. But he made a comment about the larger ramifications of what's happened because of the policy from the White House and what the bigger picture looks like around trade and tariffs. We have that, guys.
- [14:55]
Jim Leventhal
United States Post.
- [14:57]
Kevin Simpson
World War II was a global stabilizer.
- [15:01]
Jim Leventhal
We are the global destabilizer. And that's a very, you know, that's a very hard thing to say.
- [15:12]
Scott Wapner
I thought the commentary was interesting. I thought the way that he said it, how he paused for a moment to acknowledge that it's a difficult statement to make, but certain ways that things in the market are trading, dollar bonds, et cetera, may represent that perspective, which you also heard from Mohamed El Erian on social media today, that the moves that you see there could represent an erosion of confidence in the U.S. bank of America's flow show. You know what the title was today from Michael Hartnett and the crew over there, US Exceptionalism Ending US Repudiation. Starting that, you essentially have a buyer strike of U.S. assets.
- [15:52]
Jim Leventhal
See, I don't see who the. The points are well made and damage has been done both to the economy and to the United States standing in the global economy. The problem that I see on the other side of that is I don't see any other leader emerging. Maybe they will, but I don't see it now. And I want to, I want to embrace the fact that damage has been done to the economy, unquestionably. But there's another side to this. The context in which we're operating was an economy that was very strong as we went into this, whatever you want to call it. And it's not just that GDP was growing, it's that profit margins were high. It gives companies some cushion before they lay people off. Now, that won't last forever. And we've got to stop this and we've got to get back on a forward footing in terms of growing the economy. But the banking system has been strong. You haven't seen somebody blow up and get taken out. You know, there's all this worry about the treasury spiking and whether some hedge fund was going to blow up. You know, the Fed thinks that it's still restrictive, which means that they want to cut. They're getting a little bit of leeway on that with the inflation numbers. My point on this is to acknowledge damage has been done economically and to the United States standing. However, it's not a fait accompli yet. Key word yet that this is irretrievably lost.
- [17:02]
Scott Wapner
No, but there is a perspective to guys that like Larry Fink also said in this chair earlier that he can easily see a 5% 10 year because of embedded inflation from the trade war. And he made the point that a week ago today. He was shocked, he said, by the move lower last Thursday and Friday in the 10 year. We're all reacting to the rate of change in the level we are now relative to last Friday. It's not the absolute level of where we are today that's unnerving. It's the rate of change from just a week ago in which he said he was shocked at that. Not this, that this feels more normal. If we're in a more normal, higher inflation environment, then all of you have to think about the other kinds of moves that you might make in this market.
- [17:51]
Kevin Simpson
No 100% because tariffs are inflationary, whether that's transitory or not. The 10 year was at 3.9 last Friday. 3.9.
- [17:59]
Scott Wapner
That's what he's saying. He was shocked at that.
- [18:02]
Steve Weiss
The move is incredible.
- [18:04]
Kevin Simpson
Just look at the $3% like it's unbelievable. So the problems exist into Jim's point.
- [18:10]
Steve Weiss
Is there evidence? There is evidence, Jim, in terms of rates, in terms of the dollar, that the New York is not. That the US is not the default economy we're seeing.
- [18:20]
Jim Leventhal
Who's taking over, Steve?
- [18:22]
Steve Weiss
Well, I think there are plenty of takeover. I pretend I think that. Well, China has been very patient in terms of what they've done. They've moved in areas that we've ignored such as Africa and South America. They are now doing that in terms of meeting with Europe and they will forge those relations because there's no secret where China stands. You know what they are, you know what they do. There's a lot of secret in terms of where the US Stands now because Trump doesn't know where he stands stands. That tariff plan was finalized right before he went to talk about it.
- [18:55]
Scott Wapner
I know, but I don't want to.
- [18:57]
Jim Leventhal
I'm not, I don't want to get into that.
- [18:58]
Scott Wapner
I just don't want to re litigate it.
- [18:59]
Steve Weiss
No, I'm not really getting. My point is that there's no stability, so there's no dependency in terms of who your trading partner is, whereas China believe not you give that to.
- [19:08]
Jim Leventhal
I disagree between China and China's leadership.
- [19:11]
Steve Weiss
I'm not saying they are. I'm saying there's enough.
- [19:13]
Jim Leventhal
Sounded like you just said that.
- [19:15]
Steve Weiss
You want to let me finish or.
- [19:16]
Jim Leventhal
You want to know? You already said it.
- [19:17]
Steve Weiss
I mean, I'm saying that they are in a better position.
- [19:20]
Jim Leventhal
I asked you who's going to take over leadership. You said China. Don't backtrack it. 30 seconds later I will tell you I disagree with that assessment. If you meant to say something else, then correct it now.
- [19:30]
Steve Weiss
I'm going to say what I said before, which is that they are in a better position to do it now than the U.S. i didn't say they're taking it over. I said they're in better position.
- [19:39]
Mark Fisher
You.
- [19:40]
Jim Leventhal
That the United States has seated. Has ceded its leadership. I asked you who was it has seated its leadership and who's taken over.
- [19:46]
Steve Weiss
Nobody's taking it over yet.
- [19:47]
Jim Leventhal
Okay.
- [19:48]
Steve Weiss
Okay, good.
- [19:48]
Jim Leventhal
Then we.
- [19:49]
Steve Weiss
Okay, but. Well, yeah, we agree in a moment time. You continue to look backwards, I'll continue to look forward.
- [19:55]
Jim Leventhal
You continue to.
- [19:55]
Steve Weiss
That's what.
- [19:56]
Jim Leventhal
By making conjecture. You have no idea. Nor do I conjecture.
- [20:00]
Steve Weiss
But I'm willing, I'm willing to say.
- [20:03]
Jim Leventhal
That you know and I would submit to you that the right words are. You believe this is going to happen. You certainly don't know because nobody knows. And I will tell you in a condition where nobody knows. I will fall back on historical patterns, which is US Leadership even as it's been damaged leadership economically particularly. And if you want to change that someday it will change. I don't think.
- [20:24]
Steve Weiss
If you're done preaching. Let me just finish.
- [20:26]
Jim Leventhal
Jim, Let me have to appeal to the judge. Am I preaching or is he preaching?
- [20:30]
Steve Weiss
Jim, let me finish, okay?
- [20:32]
Jim Leventhal
You talk forever. Just say it succinctly.
- [20:35]
Scott Wapner
Just finish quickly because I want to.
- [20:36]
Steve Weiss
Get half the show. Look, the US has seated it, okay? It's seated leadership. Nobody's picked the crown up yet. Things don't happen in a day. But there's not a country out there that trusts us as a trading partner versus before Trump they did. So it's that destabilization that force them to find other partners. That's just natural. So we'll see that. And those will continue to impact our capital markets will continue pack our dollar will continue to impact rates as they have been. That's just what's happened.
- [21:10]
Scott Wapner
I understand that there is a lot of emotion on all sides of this. It's been a tumultuous week. Investors are unnerved. That's part of the fallout from all of this, that is going to reverberate for a while. People are emotional. I have another move from you which, which felt emotional to me anyway. But you can explain it better than me since it's your move. You sold small caps, the case that you have consistently made on this program to own for months. Okay, you sold it on Tuesday, if not at the low darn close to it. Why?
- [21:51]
Jim Leventhal
Well, it's minor detail, but I sold it Tuesday in the morning when the market was rallying. But to the point, and I made this earlier of why I sold it. It's an upgrade to the port portfolio. I have plenty of stocks in the portfolio that are. I don't want to use the word speculative, but do require the economy to come through this. Okay? And you know what? They are, Scott? And I mean, I can list them if it's a Delta, if it's a win, you know, they're.
- [22:14]
Scott Wapner
I know, I know you sold me.
- [22:17]
Jim Leventhal
Down a lot, okay? Because everything's down a lot. I mean everything.
- [22:21]
Scott Wapner
But you just made the case that you still think this is the place to be and invest.
- [22:24]
Jim Leventhal
And that's why I am fully invested.
- [22:27]
Scott Wapner
And you also said you don't see a recession.
- [22:29]
Jim Leventhal
That's okay. And that's why I'm not selling Delta and that's why I'm not selling Wynne Resorts. And that's why I stepped into Citigroup. I mean, this is not something where I'm going to all utilities and staples. I mean, in my portfolio I am underweight utilities.
- [22:44]
Scott Wapner
David Costin today says maybe you should stay defensive.
- [22:48]
Jim Leventhal
I mean, that's the argument that Steve and I, at least in part, are having about where the economy goes from here. But let me be clear, with everything being sold off, this is an opportunity, as I said earlier, to buy great companies at what I think are very good prices. So make no mistake, I am clearly looking for the economy, even if it goes through a recession, to be a short recession and one that we recover on the other side. If this is going to be something like the great financial crisis or Covid, then you certainly don't own Delta going into that. But this is not some Chicken little move. It's not. I've got plenty of high beta in this portfolio.
- [23:23]
Scott Wapner
I didn't say, and I don't know.
- [23:24]
Jim Leventhal
I'm paraphrasing, small caps lead you out.
- [23:28]
Steve Weiss
So I wonder why, if your view is so opposite of what's happening in the market, you would sell the asset class that is going to do best in recovery.
- [23:37]
Jim Leventhal
Because I haven't Sold. Because I haven't. Because I haven't sold the asset class. I mean look at things like she.
- [23:42]
Steve Weiss
Just said, you sold.
- [23:43]
Jim Leventhal
Calm down, Steve. Cases. I mean what have you keep coming.
- [23:46]
Steve Weiss
At me like that, you know it's not going to. So stick to the facts, all right?
- [23:49]
Jim Leventhal
You're way too sensitive. Okay And I understand it's an emotional time. Now look, look at the things that I own. Look at a Casey's. Look at. Look at a vertex. I mean as I already said, look at a Delta. Look at a Wynn Resort. I don't. If I've taken a little bit out of small cap, I'm not out of small caps entirely. Not at all.
- [24:09]
Steve Weiss
That line's wrong. You didn't sell small caps, Steve.
- [24:12]
Jim Leventhal
What I sold was the ETF which was one position out of 25 in the portfolio. It was approximately a 4% position in my portfolio.
- [24:20]
Steve Weiss
How big is your position?
- [24:22]
Jim Leventhal
I've taken that 4% and I've recycled it into Apple into Wabtech, which is a mid cap stock. I mean it's going to perform pretty much similarly the way. Okay, but you know, in the same AstraZeneca.
- [24:34]
Steve Weiss
Just for context, what's your typical large position?
- [24:37]
Jim Leventhal
It depends if it's something just average.
- [24:39]
Steve Weiss
Large position it easy.
- [24:41]
Jim Leventhal
So I have a 25 to 30 stock portfolio which means on average things are going to be 3 to 4%. They will be bigger in the case of an Apple where you look at the benchmark and it's roughly six and a half percent.
- [24:51]
Scott Wapner
I'm now you asked, you asked a question. And after this we are going to take a break. What are you buying? You did buy more Goldman Sachs on when it was red today.
- [25:01]
Steve Weiss
Yeah, I did buy Was today this morning? Yes, this morning. Tell our viewers I was encourage first of all the earnings from JP Morgan and as I've said repeatedly, David Solomon to me is one of the best CEOs in not only corporate America but around the world. And guess what? They've also navigated similarly tough times. And what happens in these haven't been on that side of the fence. Not being David's position of course. What you do is you go out and you talk to your accounts and you hold their hands and your advisor. But the job is actually easy from that standpoint because they reach out to the most knowledgeable, reliable partners. So I can tell you that Goldman's phone is likely ringing off the hook and that they will really strengthen the bonds that they have as well as pick up new relationships. So again, I like it. It's very high quality. It was already a core position. I just took the opportunity knowing full well with my view that this could go lower.
- [25:59]
Scott Wapner
The executive producer just got a phone call. You heard ring. I was wondering if that's like clean up on aisle four after, after you guys, we need to cut. We'll take a break. We'll get out the, we'll get out the Bounty and the band aids and whatever. We'll come back after this. We're going to talk about our calls of the day. We're also going to be joined in a little bit by legendary energy trader Mark Fisher because he is laying out what he thinks could be the best risk reward trade right now in the commodity space. We're back in two.
- [26:29]
Jim Leventhal
With HubSpot's built in AI, you can get more done than ever before. Breeze agents help you do things in seconds that used to take hours and Copilot keeps you two steps ahead, giving you the right insights at the right time. Get started today@HubSpot.com AI the last thing.
- [26:46]
Kevin Simpson
You want to hear when you need your auto insurance most is a robot.
- [26:49]
Jim Leventhal
With countless irrelevant menu options.
- [26:51]
Kevin Simpson
Which is why with USAA Auto Insurance, you'll get great service that is easy.
- [26:55]
Jim Leventhal
And reliable, all at the touch of a button. Get a quote today.
- [26:58]
Kevin Simpson
Restrictions apply. As a salesperson, the search for the.
- [27:02]
Brenda Vingelo
Right buyer or buying groups can feel like you're endlessly sifting through leads and hoping they're ready to buy. Thankfully, LinkedIn Sales Navigator is more than.
- [27:09]
Kevin Simpson
Just a tool, it's your strategic sales partner. LinkedIn Sales Navigator is a sales intelligence.
- [27:14]
Brenda Vingelo
Platform that helps professionals effectively prospect and engage high value customers, drive higher revenue.
- [27:19]
Kevin Simpson
And increase sales performance. Sales Navigator helps you target the right.
- [27:22]
Brenda Vingelo
Buyers, surface key signals such as job.
- [27:24]
Kevin Simpson
Changes or which accounts you should prioritize.
- [27:26]
Brenda Vingelo
And shows you hidden allies so you can find those buyers that are most likely to convert.
- [27:30]
Kevin Simpson
Whether you're looking for new clients or.
- [27:32]
Brenda Vingelo
Strengthening relationships of current accounts, LinkedIn Sales.
- [27:34]
Kevin Simpson
Navigator has new AI features designed to.
- [27:37]
Brenda Vingelo
Help sellers find the right people and get right to the right conversations. All at scale. Fueled by LinkedIn's 1 billion-member platform, Sales.
- [27:43]
Kevin Simpson
Navigator gives you the most up to.
- [27:45]
Brenda Vingelo
Date first party data, enabling you to.
- [27:47]
Kevin Simpson
Unlock conversations with the people that matter.
- [27:49]
Brenda Vingelo
Ready to get right to the right conversations? Try LinkedIn Sales Navigator now with a 60 day free trial at LinkedIn.com Halftime Report. That's LinkedIn.com Halftime Report for a 60.
- [27:58]
Kevin Simpson
Day free trial by.
- [28:16]
Scott Wapner
All right, welcome back. One key question through all of this uncertainty and volatility is how the retail investor is faring. Kate Rooney is following that money for us and joins us now with what you found.
- [28:30]
Brenda Vingelo
So Scott, individual investors, as we're seeing, have been leaning right into that volatility you've been talking about and continue to buy the dip. The buying remains what band of research calls robust even after retail investor activity broke records last week. As J.P. morgan put it this week in a note, investors have been willing to place confidence on the market upside despite radical policy uncertainty. That did pay off at least on Wednesday with some of the tariff and market relief. Also the post by President Trump that quote, this is a great time to buy. At the close of that day, the average retail portfolio was up 17%. That was according to JP Morgan as well. Although markets did then reverse on Wednesday at the close, we did see some retail investors start to sell single stocks and then lock in some of those gains. The dip buying really started to move more to ETFs at that point, which Vander Research says suggests some longer term broad bets on equities. Vanguard's S and P ETF is among the top trades. That's one signal that in the flows, if you look at single stocks, it's still really only Nvidia, mostly in video, at least consistently the most actively traded name. If you look at sort of the top names. To put it in context, we had one day this week where there were $3.5 billion that went into single stocks for a day, 3 billion of that went into Nvidia alone. Other retail favorites like Tesla have seen a little bit more of a mixed sentiment. There's been a little bit of hedging with some of the tech inverse ETFs, the SQ, KUQ and then the YOLO crowd. As we talked about yesterday, Scott is alive and well. Risky leverage. Tesla ETF is popping up as one of the top picks and then one with double exposure to the NASDAQ 100. Those are still among the most actively traded names, at least on Fidelity today. Back to you.
- [30:09]
Scott Wapner
All right, thank you very much for that rundown. Appreciate that. Kate Rooney, what do we think about this folks? What do you think? Retail, I mean, it's one of the key questions here certainly is how they feeling? Are they actually what talk to you about at the top of the show, right? Are you buying the dip? Are you, are you selling out? You know, these are everybody's thinking the same things and asking their advisors the same questions, right? What do I do? What do we do?
- [30:35]
Brenda Vingelo
I'm glad to hear that retail investors are buying rather than selling because I think selling right now is a bad idea. Personally, if you have a long term outlook, unless you have a short term cash need, I don't think that now is the time to sell, but I do think now is the time to buy selectively and to do it in a more incremental way. So using the inverse ETFs, I don't agree with using leveraged ETFs. That is a dangerous game and it usually ends badly. So I'm sad to hear that that's, that's a place that retail investors have gravitated towards. But nevertheless, I do think it's wise to add selectively given this volatility.
- [31:15]
Scott Wapner
All right, let's get the headlines with Silvana now. Hi Silvana.
- [31:18]
Brenda Vingelo
Hey Scott. Good afternoon to you. A federal judge has denied the Justice Department's bid to postpone today's hearing on the case of a Maryland man who the Trump administration said was mistakenly sent to El Salvador. The government claimed it needed more time to review the Supreme Court's decision last night that stated the administration facilitate the return to the US Of Gilmar Abrego Garcia. The FAA and TSB are investigating a small plane crash near the Boca Raton Airport in Florida. Officials said the plane was carrying three people when it crashed earlier this morning on its way to Tallahassee. NBC South Florida report reports multiple people are feared dead and Euphoria Actor Eric Dane has been diagnosed with als, also known as Lou Gehrig's disease. In a statement to People magazine, the Grey's Anatomy alum said he will return to the set of Euphoria next week. Currently, there is no cure or treatment to slow the disease. According to the ALS association. The disease causes people to lose the ability to speak, eat, move and breathe. Half time. We'll be right back.
- [32:29]
Jim Leventhal
Are you still quoting 30 year old movies? Have you said cool beans in the past 90 days? Do you think Discover isn't widely accepted? If this sounds like you, you're stuck in the past. Discover is accepted at 99 of places that take credit cards nationwide. And every time you make a purchase with your card, you automatically earn cash back. Welcome to the Now It Pays to Discover. Learn more at discover.com creditcard based on the February 2024 Nelson Report.
- [32:58]
Kevin Simpson
Ryan Reynolds here from Mint Mobile with.
- [32:59]
Scott Wapner
A message for everyone paying big wireless way too much.
- [33:03]
Kevin Simpson
Please, for the love of everything good.
- [33:04]
Scott Wapner
In this world, stop with Mint.
- [33:06]
Kevin Simpson
You can get premium wireless for just $15 a month. Of course, if you enjoy overpaying, no judgments.
- [33:11]
Scott Wapner
But that's weird okay, one judgment anyway.
- [33:16]
Jim Leventhal
Give it a try.
- [33:17]
Kevin Simpson
@Mintmobile.Com Switch upfront payment of $45 for 3 month plan equivalent to $15 per.
- [33:22]
Brenda Vingelo
Month required intro rate first 3 months.
- [33:24]
Kevin Simpson
Only, then full price plan options available.
- [33:25]
Brenda Vingelo
Taxes and fees extra. See full terms@mintmobile.com.
- [33:43]
Scott Wapner
All right, welcome back. Lots of attention on the commodities markets this week with crude oil hitting a four year low on fears of dropping demand. Meantime, gold surging to a new high lately as investors look for somewhere to hide in all of this market turbulence. For more on where the best risk reward is right now in the commodities complex, Mark Fisher is going to tell us. He is the CEO of MBF Trading. What a time to talk to you. I can't even imagine how your trading desks must be at the moment. Give us a sense.
- [34:13]
Mark Fisher
It's been lightly, Scott, pretty chaotic, but it's organized chaos is the best way I like to describe it.
- [34:20]
Scott Wapner
I mean moves that you would normally expect to happen in three weeks or three months are happening sometimes in like.
- [34:26]
Mark Fisher
Three minutes, even less than three minutes. But yeah, exactly.
- [34:31]
Scott Wapner
So give me your view. Let's just start with oil. I tease this out. As you know, you wanted to give our viewers what you think right now is the best risk reward in the commodities space. And it's not oil. But just give me your view on where you think actually crude is going because it's at a four year low as we said.
- [34:48]
Mark Fisher
Well, there's nobody, there's really nobody left long. Everyone's worried about a recession. The wild card is obviously Iran and what happens in these talks between the United States and Iran because obviously all bets are be off if you go ahead and get some kind of nuclear strike there. But currently, you know, with demand forecasts being what they're being with the market, it's not really exciting to me other than the fact that all bets are off if something happens, you know, when straight home moves, if something happens in the Middle east that no one can really predict. But it's all, it's in the papers now more and more every single day.
- [35:29]
Scott Wapner
What do you, what do you think's next, 50 bucks or 70 bucks for example, for WTI?
- [35:35]
Mark Fisher
70. And the reason I say is because everyone's short. The sentiment index out there is I don't know anyone that's long. So you know, if everyone's short, you know who's left to sell? I mean you have all the Mexican hedges that have been put on already by all the producer countries that drove the price down. You have all the fears of the economy imploding. So to me, that's just purely a sentiment call, nothing else but that.
- [36:00]
Scott Wapner
I mean, I get it, but that's sometimes how you have to trade things. So many different factors go into crude, for example. So you yourself mean you're long crude, thinking it's going to, that, that.
- [36:11]
Mark Fisher
But we don't have, we don't have a. We don't have. We're long out of the money calls, but we really have. And we obviously, we trade every day, but we don't really have a strong conviction right now in energy, in crude oil just because of, you know, there's too many. That's not the best place to put your wages at right now.
- [36:26]
Scott Wapner
Yeah, I hear you. One of the best places you do think is ags, grains, right?
- [36:33]
Mark Fisher
Yes.
- [36:33]
Scott Wapner
Which we hardly ever talk about. But why now?
- [36:36]
Mark Fisher
Well, that's probably one of the reasons why it's going to go up because no one talks about it. Right. If you think about it, right, all the commodity indexes, first of all, increase the weighted allocation to grain at the beginning of the year. So now you've got all this passive money that no matter what happens to the price of grains, can't get out. Secondly, after last year when you had oversupply of crops, you had, you know, you had the grain prices, corn, wheat, soybean, you know, collapse 20, 25, 30% this year. It's a whole different dynamic in terms of the strength of the cash markets and France. And more importantly, think about the tariffs, the trade wars. If I'm going to go ahead and have to import from the United States, what's the easiest thing to import? Right. Consumable. Consumable food. Right. Corn, wheat, soybeans. Right. I don't need to go ahead and build all our infrastructure that I can import that stuff, you know, hopefully use it against, you know, my commitment to the United States. Right. And everyone needs food. And unlike opec, where, you know, you can say drill, baby, drill, there's no such thing in farming as, you know, you know, grow, baby, grow, baby, grow. It doesn't work like that. Right. So on top of that, you add all the dynamics of, you know, you know, what's going to happen this summer in terms of the crops. I mean, to me, that's the most exciting and probably the best opportunities. You know, the risk reward is definitely, you know, three to one, four to one. Could it work? I hope it does. But again, when some, if Scott, if someone gives you an investment where it's one down, four up with a probability and probability ratio, you have to make that bet in the markets every day.
- [38:09]
Scott Wapner
Does it matter which wheat, corn. I mean you look at it, I.
- [38:14]
Mark Fisher
Just granularly, you know, I talk to people. Some people like soybeans, soybean meal. To me it's just easy to trade, you know, corn because it's, you know, for me it's just the most liquid. I know it the best. But again, corn's following. The grains, I think are going to end up following the same dynamic of gold. Gold. What's happened now is that in gold, if the market goes down a gold $100, no one's getting out, right? All the central banks are not getting out. No, no one cares. And the fact that now you have this passive long money that's just, you know, buy and hold, which is what the stock market used to be, which now is now because of all the anxiety, two way market. I think this buy and hold mentality, if it takes place in the, in, in the grains, should really, you know, make these markets move pretty significantly.
- [38:56]
Scott Wapner
Are you, are you in part saying that you think that it's a plausible scenario in the trade war with China, for example, that part of making incremental deals towards, you know, maybe a larger, more significant outcome is striking. A deal where China, for example, would agree to buy more of our grain and more of our ag products and then that would be certainly a stimulant for a trade to work like this. Not to mention with inflation expectations moving.
- [39:25]
Mark Fisher
Where they are and with the dollar being, you know, the dollar based, just a dollar. But I don't know if it's China so much as other countries because we've had that deal with China in the past and to some degree they reneged on their commitment. But I look at the eu, if you look at, you know, Italy, if you look at other countries, Vietnam, it's an easy, it's an easy way for them to go ahead and match what they need to do in terms of the import export formula without having to go even to China. I mean obviously China is the largest consumer, but that, that breadbasket mentality can be, can be done by any, you know, any of the foreign nations.
- [40:04]
Scott Wapner
Let me just end. Since you mentioned gold, obviously people have been watching it run up. I think 3200 is where it is now. We can pull it up now, but it's obviously been at record highs. There were a couple of moments this week where it didn't work either, but certainly has. There's no question about that. Where, where's that? I Mean, are there shorts there? I mean, where is that going?
- [40:24]
Mark Fisher
Well, to me that, that think about what's happened. This is a marketplace is now a buy at home mentality. If you, anyone who invested in gold, if it goes down $100 from here, they're not getting out. So, so if you have these permanent loans in the market long like we used to have in the stock market and people get short if the, if the market rallies, which I think it will, and if you're short, who does the short get out to? If the longs aren't going to ring the register? Right. If I'm usually, typically as the market goes up, shorts cover and longs will liquidate. If the longs aren't getting out and the shorts want to liquidate, the only person the short can get out to is a new short. And the only way you get a new short in the market is by driving the price even higher. So, you know, I'm probably saying the top right now in gold short term. So as we're talking is the same. I'm saying, okay, this will be the short term top for the next week because that's just the way things happen in the long run. The anxiety barometer, the vix of the world is gold. Right. And so for that purpose alone and for the fact that the ETFs are less committed to go than they were before. Right. You know, we had a bigger open interest in the ETF in gold three years ago than we have now. There's no reason why gold can't keep going up. You know, it's up 30% this year. Why can't it be up 50%? Who knows how high is high? I have no idea. Like the panelists I think said, how low is low? They don't know with gold is how I say no. But the mentality has changed where gold is now become an asset that if it's down to her dollars, people aren't panicking, people are going to hold it. And because of that, that philosophy changes the way people trade.
- [41:58]
Scott Wapner
I can't thank you enough. Really great insight for our viewers on a topic, frankly that we just don't get to all that often on this program. Mark, thanks so much. Mark Fisher is the CEO of mbf. I should let you know too that I'm going to go to Amen Javits here at the White House with a news alert. Market is I think around the highs of the session here, Eamon, is something you have from the White House telling us maybe why.
- [42:20]
Jim Leventhal
Yes, Scott, I don't know if this is moving markets or not, but we just heard from the president of the United States on his social media platform saying that he has forced five of the nation's top law firms to offer up more than a half a billion dollars worth of law services to causes that he supports. Those firms, according to his social media post just now, are Kirkland and Ellis, Allen, Overy, Shearman, Sterling, Simpson, Thatcher and Bartlett, Latham and Watkins. And then also separately in a separate settlement announced in a different post, Cadwalader, Wickersham and Taft. All of those firms, the president says, have agreed to post at least $500 million in pro bono and other free legal services during the Trump administration and beyond to support causes that the Trump administration and the firms agree to both support, including things like Veteran Services and others. And also these firms have agreed to abandon their DEI programs which the Trump administration calls discrimination. Some of these firms have been sent letters from the eeoc, Scott, suggesting that they were discriminating in their hiring practices. And some firms have seen executive orders targeting them for those practices. This is an effort by the those firms to get ahead of it. And Scott, it amounts to sort of a semi nationalization of big law here in terms of taking over enormous amounts of legal talent and deploying it in a way that the president wants for his political reasons. And he's doing it because these are firms that have hired or worked with his political enemies.
- [43:55]
Scott Wapner
Yeah. Eamon, thanks for that update. Amy Javers at the White House, I don't think that's why the market's moving, but nonetheless it is moving.
- [44:04]
Steve Weiss
If he can take those services and expand his ability to negotiate tariffs with other countries because these are great negotiators, then that could be one reason.
- [44:15]
Scott Wapner
It's, it's now you're really shaky.
- [44:18]
Steve Weiss
You're really getting goes to what we said before. Any headline will get the market going.
- [44:23]
Scott Wapner
I know that. Well, that's the whole the risk and everything.
- [44:25]
Steve Weiss
Yeah.
- [44:26]
Scott Wapner
As why we're on headline alert. I saw when we see the market moving and you're told Eamon Javors has news, you're like okay, what could this be? But we're grateful for that obviously for me and Mike Santoli, he's next. We are back on the halftime report. Our senior markets commentator Mike Santoli joins us now with his midday word. What are your thoughts as we wind down this week? I mean this moment in the last 10 minutes was interesting. Right now what I don't know. Now we have the TV light indicator as like people see that the reporters are coming to the tv. They like the briefcase indicator with Greenspan. The TV light goes on and people bid the market up thinking news is.
- [45:04]
Jim Leventhal
Coming which tells you essentially how twisted up markets are in general. And all I would observe is that treasury yields have been bid since the European close. The dollar bounced off of support and it shows you that the equity market is already so agitated and kind of in this high twitch mode that Yesterday's range was 6 and a half percent on the S and P. The day before that was 10%. And so all we're doing is sloshing around inside the ranges of the day before. The market can do whatever it wants in that range so it doesn't have to be a headline that moves it. I was saying this morning I would have been shocked if we didn't get at least a 2 to 3% range in the S and P today because we have a 45 Vix. You have, you know, kind of middlemen cleared out. Everybody's got a very low risk budget because volatility has been so high. So it's going to move. And I think we are still working off of the mega super oversold conditions that set up Friday into Monday. And all else being equal, if the bond market is not going to put a stop to it and if the dollar is not going to break down further, then maybe there's just some clearance to stabilize. And I would say that's all it is. You're just hoping that the market can get a little bit of a reprieve, some room to operate, maybe make some use of the oil oversold conditions even if nobody can conceivably see an all clear.
- [46:17]
Scott Wapner
Yeah, I mean guys just throw up a 10 year yield intraday because that tells the story as much as anything else. To Mike's point, you put that next to the s and P500 intraday and you're going to see a correlation. Obviously rates are moving off the boil like by 10 basis points or so and the S and P moves up in the magnitude, Mike, in which it does. We're fixated on, on the bond market and currencies.
- [46:41]
Jim Leventhal
Yes, I mean we basically the new, the new correlations have been established. Everybody's got this again, high torque positioning around this stuff. Look, who knows, somebody might have gotten tipped of a headline that's coming. We know that can happen, but I'm not saying that is. I think the market is ready to see if there could be a de escalation move from here on the trade war. But more to the point is trying to kind of figure out whether that recent flow floor that was reached on Friday can be trusted. That's 7 or 8% down from here.
- [47:09]
Scott Wapner
The Javers indicator. It's going to be a thing now. We'll see Mike. I'll see you on closing bell. That's Mike Zentol setups next. All right, more earnings next week, which is why we have the set up. Brenda, we go to you first for J and J. Talk about some health care name.
- [47:39]
Brenda Vingelo
Yeah. So I think so far this earnings season we've only heard from financials. We haven't heard about what the real impact from tariffs could be on businesses, just on the broader economy. But I do think with the J and J, that is going to be what everyone's going to be focusing on. And unfortunately there's not a lot of clarity there. But I think if we take it off the tariff uncertainty, the underlying trends for the company should still be fairly decent. Looking for around 5% earnings or revenue growth. But I think it's going to be very muddied up by, by tariff comments and uncertainty.
- [48:08]
Scott Wapner
Kev. Unh.
- [48:10]
Brenda Vingelo
Yeah.
- [48:10]
Scott Wapner
The corner next Thursday morning.
- [48:13]
Kevin Simpson
Who wants to wait that long? Wish we didn't have this weekend coming up.
- [48:16]
Scott Wapner
All right, game it out for people then.
- [48:17]
Kevin Simpson
UNH is going to have great numbers. It's going to be fantastic. It's the cornerstone into the health care space. We trimmed it a little bit with the DOJ news. Glad we didn't sell it out. It's been one of our best performers. The problem with all these earnings though next week, it's backward looking and it doesn't affect anything having to do with tariffs. To Brenda's point, we'll listen for guidance. We won't get it. So this might be like the best earnings season we ever have that nobody cares about.
- [48:39]
Steve Weiss
The most interesting that you. And of course is that right now it appears they're targeting Medicaid cuts which could impact their business. But with Medicare Advantage every way to negotiate around.
- [48:50]
Scott Wapner
It's funny, Netflix is, is trading like a staple. Like a staple like, like a real poor like people that. I'm never getting rid of my Netflix. I don't care what happens with the tariffs and the economy. It reports next week. Real quick.
- [49:02]
Steve Weiss
Yeah, I think it's going to be a great quarter. I mean you never know on the subscription zero. But overall, this is when you hold.
- [49:08]
Scott Wapner
All right, we'll do finals next. Hope you'll join me. Closing bell today for the final stretch of a crazy week. Tom Lee is going to be with us so is the tech investor, Glenn Kacher, and I hope you'll join me. Then let's do some final trades. Kevin Simpson, you're first.
- [49:24]
Kevin Simpson
T.J. maxx. It's a standout name in a tough retail environment. Solid earnings, free cash flow, great balance sheet.
- [49:30]
Scott Wapner
Bren, Safe travels back West. Nice having you here.
- [49:33]
Brenda Vingelo
Thank you. Happy to be here. Meta. I think it's going to be a winner in the overall outcome advertising space.
- [49:39]
Scott Wapner
All right.
- [49:39]
Steve Weiss
ABB v. Taiwan, semi exempted from China chips. I think he'll do the same thing.
- [49:44]
Scott Wapner
In the U.S. all right, good stuff. I'll see you on the bell. You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern only on CNBC.
- [50:00]
Kevin Simpson
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.
- [50:29]
Scott Wapner
Warrant its completeness or accuracy, and it.
- [50:32]
Kevin Simpson
Should not be relied upon as such. To view the full Halftime Report disclaimer.
- [50:35]
Brenda Vingelo
Please visit cnbc.com halftimereportdisclaimer.
- [50:39]
Jim Leventhal
Growing a business can feel impossible. But with HubSpot's built in AI, you can get more done than ever before, which means anything's possible. Breeze agents help you do things in seconds that used to take hours, providing the customer support of 5 us generating the content of 10 use and Breeze Copilot keeps you two steps ahead, giving you the right insights at the right time to close more deals than ever. HubSpot Impossible growth made impossibly easy. Get started today@HubSpot.com AI.