B (4:53)

Scott okay, Eamon, I appreciate that very much. We'll come back to you as needed. That's Amen Javers down in Washington in the market moves have been interesting today down rather sharply off the open, but we've cut the losses about in half as I saw on the last check. There's the s and P500 still down by almost one and a quarter percent but nonetheless better off than it started this day. I've got the investment committee with me today. To Joe Terranova, Malcolm Etheridge, Surat Sethi, Josh Brown. Joe, your thoughts first.

E (5:21)

So there is no reason to define the volatility. The volatility is here. Understand that. I don't think we have enough clarity I. I don't think we have enough confidence in the clarity to expect on a day like yesterday where it looked as though you had the all clear and the market's going to break out to the upside to believe that can unfold. I think the same thing is true this morning. I don't think you have enough clarity to believe that there's a significant deterioration that's unfolding. So what do you do in that type of environment? You try to find opportunities where you can create alpha. I said yesterday CF Industries, that is a name, that's a equity that I purchased yesterday. That's where I believe you can create some alpha. Because of this situation. Situation, you maintain exposure to the refiners. Diesel prices, they are soaring today. If you believe there is a supply disruption as it relates to oil in the Middle east, look up north Canada, you have Suncorp, you have Canadian Natural Resources have some exposure to the financial exchanges. We have cme, we have ICE and Jyoti. CBOE is a name that I am looking at currently. I think that is where you have to think about the alpha opportunity. And lastly the Mag 7. I told you last week I didn't think you would buy Microsoft. I will change that right now we own it in Jyoti. I think there's resiliency in the mag 7. I'm seeing it reflected in Microsoft and Apple and Metta.

B (6:45)

Notice that also that Microsoft move into the green. Malcolm, over to you. According to Barclays today, as we see many different parts of this market moving the geopolitical risk index surging to its second highest level on record only behind the events of 911 BTIG's. Jonathan Krinsky with a note today that says when missiles fly, it's time to buy. Typically sharp moves on geopolitics are not durable, he suggests. What are your own views to that end?

F (7:13)

I think this is the kind of market where opportunities are created. It's not a time to be buying the entire market across the board. We haven't seen this level of dispersion within the S&P 500 in quite some time. I myself, along with other folks have been sitting at this desk for over a year saying that a buyer's market is coming. This is the buyer's market. So Barclays had another piece out earlier today pointing out the fact that about two and a half percent is the trading range on the S and P so far this year, but the average company in the index has moved seven times that amount. So if you look at a company like a Microsoft, you mentioned a Palantir, for example, they're down about 15% so far year to date. But you've got like Devon Energy, for example, or Diamondback that are up more than that amount. The other direction. And so the dispersion between materials and energy, which are leading the S and P so far this year compared to financials and tech, which led last year, couldn't be better. And so I think this is an opportunity to be buying your favorite stocks and not necessarily trying to just grab everything as a basket.

B (8:15)

So, Rob, many of the strategists out there today aren't giving up their positive views of the market. Katie Huberty over at Morgan Stanley suggests that recent geopolitical events unlikely to change their bullish view on equities over the next 6 to 12 months. UBS saying as well we expect only minimal or a brief disruption to global energy supplies. You know, obviously our eyes are on the Strait of Hormuz. What is happening there? They say, quote, we therefore stick to our base case that US equities will produce good gains this year. Do you agree?

C (8:47)

I think at the end of the year we should see that. But you know, when you look at midterm election years, the interior year drawdowns are close to 20%. And normally you can say, well, what's going to cause that? Here we've got an example of things happening exogenously. So I do think the market is still poised for an upward trajectory. But while we go through to Malcolm's point, I think you're going to find good stocks along the way. You know, we're adding to Disney at these levels at 15 times earnings, I think high quality companies are going to be on for sale. That's where you really need to focus on.

B (9:14)

Yeah, you know, energy obviously is where a lot of the focus continues to be. We can take another look at crude oil spiking again today on concerns oversupply over the Strait of Hormuz being closed or at the very bare minimum, some degree of disruption there. Josh, it turns me to you. Natural gas is in focus today too.

E (9:35)

You Sold.

B (9:36)

Devon Energy. Tell me why it's still on your best stocks list. Malcolm just mentioned that name. Why are you selling it here?

G (9:45)

I took a profit. Look, the energy stocks have been the place to be this year. It's a wild year in terms of dispersion. Citadel securities put out a note a couple of days ago talking about this being in the 97th percentile of dispersion of returns going back three decades. And even if you're not looking at the data just anecdotally, you look at your open your brokerage app if you're retail, if you're an institution, you're an asset manager. Look at the sheets of your positions. It is unbelievable the degree to which stocks are diverging from each other. And what's most interesting is we're in an environment where more than half of all active managers are outperforming. Why is that? Because they look different than the S&P 500. The S&P 500 is not having a great go of it. However, you look at sectors that are tiny in the index like energy and that's where all the performance is. The energy sector as of the close Yesterday was up 28% in total return this year the second best sector materials up 17%. Nobody owns these stocks in size.

B (10:54)

You can't.

G (10:54)

They're not big enough for the most part. So I'm out of Devon took a profit. I am long exxonmobil. I have not come out of that. I'm rolling my stops higher. Look at the put up the chart of that one while I'm talking. 100% of the XLE names judge are above their 50 day moving averages. This has been the case every day for 20 straight trading days back to the first day of February. These are the names today only half of oil stocks are up. Some of them there's profit taking. Today is a day I think where you look at the areas of the market that you don't have exposure and try to find something to do.

B (11:33)

You know the fallout from all of this may not be in the most obvious of places at any moment. The Wall Street Journal has a piece out today that talks about the digital activity of Iranian linked cyber groups has risen by tenfold since the start of all of this. We're only four days in and that's according to Check Point software. They're based in Israel. They are a cybersecurity company. You do have CrowdStrike reporting its earnings after the bell. This space in general has been upset in the rest of the software pullback. Malcolm how you look at this heading into a number stock that a lot of people like, a sector that a lot of people have made the case for, that may be more relevant today than it has been oftentimes in the last many months.

F (12:18)

Well, to the stock market maybe it hasn't been respected as, as relevant as it should have been. And I think there's still an opportunity here, especially if CrowdStrike is follows the mold of the rest of companies that have reported earnings and immediately sold off after. If it does, we sit at about 385 today. That's basically where it was in July of 2024 before the outage that caused the sell off. So if it does sell off after earnings report after the close today, I will be buying because for the last 20 plus years, software as a service has been the thing that allowed workers at companies to basically be more efficient and do their work faster. Now as we shift to agentic AI, this is a world where the robots are supposed to step in and do work on behalf of the workers, carte blanche autonomously with access to our actual credentials, logging in on our behalf and making commands. That says to me that a company that the category leader in cybersecurity right now at least cloud based cybersecurity is going to be one of the biggest beneficiaries of the increased spending that has to come to this category. That's a place I want to be long for a while.

B (13:22)

Josh, you want to, you want to give me your view here of a Stock that's down 20% year to date coming into this number today?

G (13:30)

Yeah, you're talking to somebody that rode this stock down in the summer of 2020. I guess it was 24 now. I don't even know when there was like an outage around the world because CrowdStrike pushed an update and there was like a 24 hour hiccup in, in all these customers. They fixed that problem. The stock fell, I don't know, 40% and then went up 100 and something percent. So if I rode that out, I really don't have an issue writing whatever this is out. I don't believe in it. I think it's a fairy tale. I think this idea that and Anthropic launched a bug detector, therefore Fortune 500 companies and businesses and governments around the world are going to rip out their cybersecurity is the dumbest thing I've ever heard. And I've been on Wall Street 28 years. I still think that selling, staying long. Believe in George Kurtz, believe in Falcon and I think this thing under 400 is a screamer.

B (14:29)

What do you think, Joe? This space here.

E (14:31)

So I took a small step back towards having cybersecurity exposure yesterday by purchasing the EIS and it's Cyber Arc and its Checkpoint software. I like Checkpoint individually as a stock. It's a name at some point I would consider buying. I had protected what was a profit in crowdstrike. I announced that I had bought it December of 24, 355. Unfortunately I had to stop out of it just to protect the position and a 5% gain. But I like what Malcolm saying here as it relates to cybersecurity and it's one of the reasons I took that small step back towards it with the eis.

B (15:03)

Okay, I think we need to discuss before we take a break private credit. Because it though not obviously Iran related, it is a big story in this market day after day, including again today as we take a look at shares of Blackstone. That is the stock in the news today, B Cred. That's their flagship private credit fund. Record Redemptions there. There's the stock. It is about half as bad as it was earlier today. John Gray sat with David Faber earlier to try and allay some of the fears that have been around this name and the redemptions around it. We do have ownership here. Surat, you own it still. So how are you thinking about this as the whole complex of private credit I think remains under a pretty sharp microscope.

C (15:51)

It does. And you know, this reminds me back of the B REIT issue we had with Blackstone as well. When you look at a high quality Blackstone, which I think is one of the best ones, you know, great coming on tv talking about their book. I think you're going to have sellers now, people taking the redemptions. But I think longer term a Blackstone is a great way to play the alpha in the market because they are exposed to other areas as well, not just credit. They'll be there in real estate, they're in private equity. They're in a lot of different distributions that I think over time. But right now people are selling first, ask questions later. We're holding and I'll buy when it gets, you know, even if it gets

B (16:25)

5% lower, you got somebody on your right who in fact is doing just that. Sold it last week. Malcolm, tell them why.

F (16:33)

Across the board the alternatives managers have a sentiment problem. I think that's what you were alluding to. It might not be the fundamentals underneath the surface, but investors do not care right now. They're calling up their advisors and saying, get me out of it. So to me, the safest place to be for a person like me who still wants exposure to the sector is in Carlisle, simply because the biggest knock against Carlisle for years has been that they sit on too much dry powder, about 84, $85 billion. Right now they're sitting on in cash, which if I remember right, is about the size of B cred. So what was once their Achilles heel is actually the thing that's looking like a strength for Carlisle right now. So to me it looks like the safest place to ride this out.

B (17:11)

I guess, Josh, you would agree with that, considering it is the name out of the group that you do own.

G (17:17)

Yeah, I think in this space, more than most other spaces, you really have to bet the jockey and not just the horse. Obviously these are all fabulously successful companies, all the publicly traded private equity firms, so we're not talking about bad horses. But on the management side, I do believe in Harvey Schwartz, I always have. I'm a shareholder because I think his vision for what this industry can do, not just in wealth management, which we're talking about a lot today, but generally speaking is the right one. I do think on the B cred side, look, I, I, I watch this thing from afar. We're not a firm that's putting client money into private credit vehicles. It's not that they're bad, they're good, they're great, they're terrible. It's just that the trade off, the liquidity that you're giving up in exchange for the return right now is not materially different in my view, than what you can get with public vehicles. And our clients prize liquidity and especially if we get a downturn in the economy, they don't want to hear you can get 5% of your money out. Like that's not interesting to them. And so I think the problem that this industry is going to face, and it's not just Blackstone, all of them, they've kind of made this big bet that wealth managers and their retail clients are going to act like institutions. Unfortunately, these navies haven't even dropped and people are freaking out. Individuals are never going to behave like institutions and no wealth manager sitting in the middle on earth can force them to. So it's just going to be a different type of client and they're going to need a better approach on the PR side than what we're seeing so far. They'll be fine. I don't think anyone needs to panic, however, very happy. Not to be in the middle of this.

B (19:06)

Okay, we'll follow that. We will squeeze in a break. When we come back, we'll tell you about our call of the day. One firm says its highest conviction overweight is not in the United States. We'll tell you where it is next.

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B (20:47)

Unsettled market, but want to show you the Dow intraday because we are off of the very worst levels, down by about 12, 1200 earlier. So we've cut them in half as we try and work our way and get a little more constructive on these markets. As we watch all of the events happening in and around Iran, that region and certainly over in Asia from a market perspective where you've had big sell offs overnight, I tease the fact that there's a firm out today, Sigi Capital Markets quote our highest overweight conviction remains emerging markets, where the narrative for another supercycle could be the ongoing diversification away from U.S. trade uncertainty. You can obviously think of other uncertainties too. We think about that.

E (21:29)

I think it's a reaction to the significant rally that we're seeing in the US dollar where a lot of the M and developed international non U S markets that have performed really well so far year to date. South Korea obviously being one of the best performing saw overnight some selling pressure. You had somewhat of a little bit of a lack of liquid liquidity that exacerbated that. I think you want to take advantage of this sell off. I think you want to give consideration to increasing the exposure there. I think you want to think about oil and think about who is an oil exporter that takes you to Brazil, the ewz. If you could show that chart while I'm speaking too. You could also look at Mexico E W W that gives you exposure there as well. And back to EIS which I announced yesterday I purchased and I believe that is a secular long term holding because of the exposure you get to technology and to banks and to health care. I think that is one of the better performing regions that you could own. As we think about capital creation in

B (22:29)

the Middle east, it's not just CG capital. Josh who has this belief. UBS on Friday said their highest conviction overweight continues to be emerging markets. The EEM only up 4 and a half percent year to date but that's still 4 and a half percent at least better than what we've done here. Other markets all around the world have better returns to this point in this young, still young year than the United States does. What about these calls?

G (22:57)

Yeah, look, I think this thing is going to have legs beyond just six months or a year. Over the last 15 years we've really seen like these three month rally, six month rallies. People have gotten very frustrated because every time you get bowled up on international it like fades away and the Max 7 come roaring back and you feel like an idiot again and you're back to apologizing for your to your clients. Why do we have this 8% sleeve? Right? Like that's the thing that allocators are sick and tired of. I think the switch flipped. Some of that is dollar structure, contractoral dollar weakness. Some of that is on shoring. We're not the only country that recognizes the strategic need to invest in infrastructure within our own territory. And then some of that is just you know, plain vanilla growth initiatives happening at the government level that sparking better stock markets overseas and more enthusiastic investors. But when you combine those things, Judge, you have to say this is probably going to be different. And those three month rallies that faded away. This one looks like it has legs and there's a fundamental underpinning. And so I agree with what Joe said. We are long international stocks, international value, international small cap. They look unbelievable. They are lapping the S and P. I don't see why that has to stop.

B (24:16)

Let's go back to Amy Javors in Washington who's following a developing story for us. What do we know here?

D (24:20)

Eamon Scott, the developing story is the administration's battle against big law firms. Remember yesterday the administration reversed course. It filed a motion in federal court asking to drop its appeals of cases against those law firms. Remember the administration had an executive order against those law firms barring them from contracts and classified information, that sort of thing, as part of the president's sort of war on big law. Yesterday they moved to withdraw their appeals and today the administration has now withdrawn that request to withdraw. So yesterday they reversed course and today it appears they're reversing course again. Texting with the Department of Justice moments ago. They do not have any comment on this. But this appears to be a very up and down situation here over the past 24 hours, Scott, where yesterday it would have appeared that the big law firms had won a significant victory. Today it looks like maybe the administration is preparing to re up that fight and get back into it. We'll see where it lands.

B (25:24)

Okay, thanks for that update. Eamon Jabbers in Washington. Josh Brown's best off stocks in the market is next.

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B (26:59)

We're back. Josh Brown's best stocks in the market. That is what we're doing now. And the spotlight today, Josh, is on

G (27:05)

where, oh, we're going to look at chemicals. Guys, I got to tell, I got to tell you.

B (27:13)

You think it was my best. I got to tell you.

G (27:17)

All right, let me do my, let me do my shtick.

D (27:19)

Okay?

G (27:20)

I gotta tell you this. This is one of the areas of the market where I find younger investors literally know the least. And there's a good reason for that. These stocks have largely sat out a multi year bull market. They've never seen these go, but when they go, they really go. And I want to show you three of them. The best one is Echo Lab. ECL is the ticker. This is Halo af, ef. And I'm going to tell you why. Basically what this company provides cannot in any way be disrupted by anything going on with AI. The stock is acting that way. It's above both moving averages right now. And even on a big blood red day for the market, this thing is holding its gains. I really like it. I think you could pull the trigger right now. I want to tell you about LIN and shw. I think shw, Sherwin Williams, the weakest of the three. That's probably not the one I would run to Lin. Very interesting. This is lind. This is chemicals and air and all sorts of things. That $500 level seems to be really important. It shook off the intraday weakness, rallied right back there, had a massive earnings beat the other day. And you could see a golden cross starting to form as that 50, 50 day gets above the 200. In my column for CNBC Pro, I have the risk management levels for all three. If you're a subscriber, you could see where that trade might change. Right now, I think these stocks are

C (28:46)

all going to work. So, Lindy, if you want to buy European and international exposure, you also want to buy our products, which is one we own, which is hydrogen and liquid gas. That's another one. And to Josh's point, it's something that's very under owned. Most investors don't know about it unless you've been in the game for a long Time.

E (29:04)

We own it. Very strong capital allocation strategy. We also own Echo Lab. They're very strong. Free cash flow as well. Balance sheets are phenomenal material. Space right now is a sector that you want to have ownership to. Despite what you're seeing today from Freeport, McMoRan and Newmont.

B (29:20)

I know what Halo stands for, but AF. No, I'm just kidding. Don't, don't. Don't go there. We're going to have to leave it there.

G (29:27)

Yeah, we'll have to leave it there.

B (29:29)

We will. We will have to leave it there. I do want to talk about some other stocks that are in the move. On the move.

E (29:34)

Excuse me.

B (29:35)

Now I'm all flustered. Archer Aviation, they're calling for an adjusted loss before interest, taxes, depreciation and amortization. Josh, you own the stock?

G (29:48)

Yeah, look, I. I think it's not that complicated. These are highly be. Let's call them experimental technology companies. However, this isn't a big industry for the future. We don't know who's going to win. So I own this one. I also own Joby. I think I'm twice as big in Joby as I am here. These are not gigantic positions for me because I recognize it's going to take years before we see, like, cash flow generation to justify the valuations. But I'm still long and I follow the news every day.

B (30:19)

I haven't gotten your view, I don't think, Josh, on Netflix, since they bowed out of the bidding. So, you know, the big news, for those who may not remember, is that you pared back your position substantially after the news first and their bid first emerged several months ago. Stock obviously went nearly straight down. Guys, can you show me a. I don't know, three, six months. Better than that for me. Can you show me six months, please? Because that shows.

G (30:48)

Thank you, judge.

B (30:49)

Sorry.

G (30:51)

They're quick.

B (30:51)

They're good. Six months shows the decline now.

G (30:55)

Now what I got, I got out of most of my position as it broke below 100 people. The street just hated the deal. They never liked the deal. I think it's probably a situation where the right bidder won the company like this. Paramount needed this. Netflix didn't need it. It would have been nice to have. They would have picked up a lot of, like, really great properties to do new shows and spin offs. And they would have picked up their own studio lot, a gigantic one, one of the original studios, but they never needed it. And I think that's what you're seeing here in the chart. I did add a little bit in the 70s. Not enough, obviously in hindsight. But I think that this is back to being a constructive name. And I think this is a stock that if you missed it over the years and you're looking for your opportunity, this is it. We're in that opportunity right now.

B (31:47)

Okay. So coming up, three o' clock on closing bell as our time is quickly running down here. Tom Lee, Jeremy Siegel, Richard Fisher on what all of this means now for the Fed. I haven't talked that much about that. We will at 3 o'. Clock. Alex Cantuitz as well. Josh, what's your final trade today?

G (32:05)

Toast Value Act Capital just doubled their position in the stock right after the earnings report. I like it.

B (32:11)

Okay, Surat Disney. Must be you sticking with Disney service now?

F (32:16)

Yeah. Look how it's trading. As the world is melting down around us today. Maybe we finally have touched the bottom.

B (32:21)

Well, we shall see.

E (32:23)

Joey T resmed all this volatility. A lot of people have sleep disorders like men.

B (32:27)

Alright, so let's see where this market goes over the next few hours and I'll join you on the closing bell. You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern only on CNBC.

A (32:45)

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 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 opinion. Such opinions are based upon information the Halftime Report participants consider reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy and it should not be relied upon as such. To view the full Halftime Report disclaimer, please visit cnbc.com halftimereportdisclaimer did you know that parents rank financial literacy as the number one most difficult life skill to teach? Meet Greenlight, the debit card and money app for families. With Greenlight, you can set up chores, automate allowance and keep an eye on your kids spending. With real time notifications, kids learn to earn, save and spend wisely and parents can rest easy knowing their kids are learning about money with guardrails in place. Sign up for Greenlight today@Greenlight.com podcast.