Halftime Report: Playing the Rebound – May 2, 2025

Released on May 2, 2025

Host: Carl Quintanilla
Guests: Scott Wapner, Stephanie Link, Kevin Simpson, Surat Sethi, Rob Seachin, Steve Kovach, Kate Rooney, Megan Casella

1. Introduction

In the May 2, 2025 episode of CNBC's Halftime Report, host Carl Quintanilla and panelists Scott Wapner, Stephanie Link, Kevin Simpson, Surat Sethi, and Rob Seachin delved into the latest market movements, highlighting a significant rebound in the stock market amidst robust economic indicators. The discussion also touched upon the ongoing trade tensions with China, notable company performances, and upcoming financial events.

2. Economic Indicators

Resilient Economy & Jobs Report

Stephanie Link opened the discussion by emphasizing the strength of recent economic data. Highlighting a remarkable nine-day streak of positive performances in the stock market—the longest since 2004—Link noted:

“[...] the GDP report's headline was not good, but final sales to domestic purchasers are up 3%, indicating true growth and demand” ([01:58]).

She further elaborated on the non-recessionary indicators:

“Non-farm payrolls were very good, with average hourly earnings contained at 3.6%. Inflation is coming down, gasoline prices are down 13% from last year, and food prices at home are down from peak levels a year ago” ([02:48]).

Inflation and Consumer Prices

Link provided a comprehensive overview of inflation trends, pointing out the decrease in gasoline and food prices, which contributed to a constructive economic environment. She also highlighted strong corporate earnings as a driving force behind the stock market's 14% rise from April lows:

“Earnings have been better than expected, with 72% of S&P 500 companies reporting a growth rate of 13.3% and revenues running at about 4 to 5%” ([02:58]).

3. Stock Market Overview

Broad Market Gains

Carl Quintanilla set the stage by noting the positive movement across major indices:

“At least 1% for all three of the majors” ([00:48]).

This upward trend was attributed to robust earnings reports and resilient economic data, dispelling previous concerns about potential market downturns.

4. Company Highlights

Apple Inc.

Rob Seachin provided an in-depth analysis of Apple, focusing on the company's strategic adjustments amidst tariff challenges:

“With a premium valuation and a lackluster product refresh cycle, we remain neutral on Apple. However, given their strong balance sheet and shareholder-friendly management, it's hard to be underweight” ([03:44]).

Steve Kovach further detailed Apple's supply chain management:

“Tim Cook has managed to shift more than half of iPhones sold in the USA this quarter to be sourced from India, resulting in a $900 million charge in the June quarter due to tariffs” ([11:11]).

Despite these challenges, Apple’s revenue growth remains steady, supported by high margins and continued market dominance.

Amazon.com Inc.

Stephanie Link and Kate Rooney discussed Amazon's recent earnings performance, emphasizing growth in North America and advertising revenues:

“Amazon posted total revenues up 8.6% in North America and international retail, with advertising up 18%, the highest margin piece of the company” ([19:40]).

Surat Sethi added optimism about Amazon’s long-term prospects:

“With Amazon’s extensive infrastructure and scale, they are well-positioned to weather the trade war and potentially capture greater market share” ([20:32]).

Blackstone Group Inc.

Rob Seachin highlighted Blackstone's strong position in the alternative asset management space:

“Trading at 25 times forward P/E, down from a peak of 35 times last year, Blackstone offers healthy diversification and is expanding into individual and retirement channels, which present significant growth opportunities” ([23:54]).

Amgen Inc.

Kevin Simpson lauded Amgen's robust earnings and promising drug pipeline:

“Amgen crushed earnings with strong performance and is on the verge of releasing a revolutionary GLP1 drug, making it a value stock worth considering” ([25:09]).

5. Trade War Developments

Potential Chinese Tariff Adjustments

A significant portion of the discussion revolved around the evolving trade tensions between the United States and China. Megan Casella reported on a Wall Street Journal article suggesting that China is contemplating an offer related to fentanyl to restart trade negotiations:

“Beijing is considering sending their securities czar to Washington or arranging meetings in a third country to address the Trump administration's concerns over fentanyl” ([08:22]).

Carl Quintanilla emphasized the market's positive reaction to this potential development:

“Such a move could lead to the cancellation of the 20% fentanyl tariffs, thereby reopening trade talks and stabilizing the market” ([13:04]).

Surat Sethi concurred, noting that any progress would be welcomed by the markets:

“Given the unsustainable nature of the current trade impasse, any resolution would likely be beneficial for economic stability” ([17:10]).

6. Upcoming Events

Berkshire Hathaway Shareholder Meeting

The panel anticipated significant insights from Berkshire Hathaway's annual shareholder meeting. Mike Santoli provided a preview, emphasizing the company's resilience and enduring business model.

Kentucky Derby Coverage

Carl Quintanilla and Scott Wapner discussed the upcoming Kentucky Derby, highlighting key contenders and the unique challenges posed by a large field of 19 horses:

“With 19 horses and potential weather disruptions, the race is unpredictable. Recent trends show that favorites don't always win, adding to the excitement” ([39:09]).

7. Closing Remarks

As the episode concluded, the panelists shared final stock picks and strategies. Rob Seachin advocated for Blackstone as a strong buy, while Stephanie Link recommended writing covered calls on Apple and Amazon to capitalize on current market conditions.

Stephanie Link encapsulated the episode’s sentiment:

“With a resilient economy and strong earnings reports, the market shows promising signs of further growth, though caution remains due to ongoing trade tensions” ([36:26]).

Carl Quintanilla wrapped up the discussion by encouraging listeners to stay informed about market developments and upcoming events, ensuring they are well-prepared to navigate the evolving financial landscape.

Notable Quotes

• Stephanie Link: “Non-farm payrolls were very good, with average hourly earnings contained at 3.6%. Inflation is coming down...” ([02:48])

• Rob Seachin: “With a premium valuation and a lackluster product refresh cycle, we remain neutral on Apple...” ([03:44])

• Steve Kovach: “Tim Cook has managed to shift more than half of iPhones sold in the USA this quarter to be sourced from India...” ([11:11])

• Surat Sethi: “Given the unsustainable nature of the current trade impasse, any resolution would likely be beneficial for economic stability...” ([17:10])

• Stephanie Link: “With a resilient economy and strong earnings reports, the market shows promising signs of further growth...” ([36:26])

Conclusion

The Halftime Report episode on May 2, 2025, provided a comprehensive analysis of the current economic climate, highlighting the resilience of the U.S. economy, the positive trajectory of major stock indices, and strategic insights into key companies navigating trade tensions. The panelists underscored the importance of informed investment strategies amidst evolving market dynamics and anticipated significant developments from upcoming financial events.