Halftime Report: Tech Earnings Drive the Rally (July 31, 2025) Hosted by CNBC's Frank Holland (in place of Scott Wapner)

Introduction In this episode of CNBC's Halftime Report, host Frank Holland leads a comprehensive discussion on the recent surge in the stock market driven primarily by robust tech earnings. The panel includes esteemed guests Josh Brown, Jenny Herring, Bill Baruch, and Malcolm Etheridge, who delve into the implications of strong performances from tech giants like Microsoft and Meta, and explore the potential impacts on other major players such as Apple and Amazon.

Market Overview The episode kicks off with a brief market update:

• S&P 500: Achieved a new all-time high, up approximately 0.5%.
• Nasdaq: Nearly 1% increase, also reaching a fresh peak.
• Dow Jones: Remained relatively flat with a slight upward movement.

Frank Holland sets the stage by highlighting the significant role tech earnings are playing in uplifting the broader market indices, positioning the discussion towards the decision-making strategies investors might consider amidst this rally.

Microsoft Earnings and Strategy Timestamp: [01:59]

Josh Brown provides an in-depth analysis of Microsoft's exceptional performance:

• Cloud Revenue: Up by 23%, with Azure revenues growing 34% year-over-year.
• AI Integration: Copilot apps surpassing 100 million monthly active users, and over 800 million users leveraging AI across Microsoft products.
• Capital Expenditure (CapEx): Microsoft is guiding to allocate nearly 40% of its revenue towards CapEx next year, marking a significant increase from previous years.

Notable Quote:
Josh Brown remarks, "The demand just seems endless. These companies are living in their own world." [01:59]

Malcolm Etheridge concurs, emphasizing the stock’s potential for growth due to sustained high CapEx and strong execution: “As long as Microsoft continues to outperform, there's no reason to expect that the trade is going to go the other way.” [04:51]

Meta's Stellar Performance and Concerns Timestamp: [06:05]

Jenny Herring discusses Meta’s impressive gains, noting that both Microsoft and Meta are up about 50% from their April lows. She addresses Meta’s CapEx guidance, which only raised the bottom end to $2 billion, signaling controlled spending amidst aggressive growth.

Notable Quote:
Jenny states, "We're constantly saying should we trim? Is CapEx getting too aggressive? So far, so good." [06:23]

However, Jenny expresses concerns over Meta’s high valuation: “It's just getting rich. Trading at 27 times forward earnings.” [07:15]

Scott Wapner adds perspective on Microsoft’s valuation: “Microsoft is... embedded in the AI supply chain... it's a name they have to own.” [07:33]

Nvidia’s Security Concerns and Market Reaction Timestamp: [09:34]

Christina Partsinevelos reports on Nvidia's recent meeting with Beijing officials regarding national security risks associated with their H20 GPUs. Nvidia reassures that there are no backdoors in their chips, aiming to alleviate Chinese concerns about potential remote shutdowns.

Notable Quote:
Nvidia clarifies, “Nvidia does not have backdoors in our chips that would give anyone a remote way to access or control them.” [10:22]

Josh Brown, as an Nvidia shareholder, remains optimistic: “Nvidia has a really good track record of getting around these kind of thorny issues.” [10:43]

Apple’s Position Amidst Tech Giants' Boom Timestamp: [19:24]

The discussion shifts to Apple, highlighting its subdued CapEx strategy compared to its peers. Steve Kovach from Apple addresses the company's cautious approach towards AI investments and tariff impacts.

Notable Quote:
Steve Kovach indicates uncertainty surrounding future AI strategies and tariff-induced costs: “We’re looking at whether Apple will increase prices or absorb the costs.” [17:55]

Malcolm Etheridge analyzes Apple's financials, noting modest earnings growth and minimal CapEx: “Apple seems to be a no-growth business, yet we’re valuing the stock for its stability.” [19:49]

Amazon’s Earnings and AI Potential Timestamp: [24:40]

Josh Brown presents a positive outlook on Amazon, emphasizing the performance of Amazon Web Services (AWS) and its pivotal role in AI services.

Notable Quote:
Josh states, “AWS has a backlog of $189 billion... positioned to deliver AI services to more customers than anyone else.” [25:00]

He also highlights Amazon’s attractive valuation: “36 times earnings, the lowest multiple since the company went public.” [25:00]

Interview with JP Morgan’s Jamie Dimon Timestamp: [29:39]

Leslie Picker interviews Jamie Dimon, discussing:

• Fed's Interest Rates: Dimon anticipates rate cuts if inflation continues to decline.
• Tariff Policies: Acknowledges improvements in tariff strategies and their impacts on exports.
• Private Credit: Dimon expresses cautious optimism, recognizing both opportunities and potential risks in the private credit market.

Notable Quote:
Dimon remarks, “I'm cautious about when people provide credit. It isn't, you know, I'm just cautious about when people provide credit.” [30:35]

Capital Markets and IPO Pipeline Timestamp: [33:51]

Jenny Herring reflects on the resurgence of tech IPOs, with a particular focus on Figma's hot debut:

• Figma’s IPO: Priced at $33, with opening trades expected between $100-$105, indicating more than a tripling of the offer price.
• Market Sentiment: Jenny likens the current IPO frenzy to the late 1990s, emphasizing the positive impact on market accessibility and investor opportunities.

Notable Quote:
Jenny states, “It's a wonderful market that really allows everyone to have access to great companies.” [34:59]

Commodity Market Insights: Copper Timestamp: [44:20]

Scott Wapner and Jenny Herring analyze the recent downturn in copper prices:

• Copper Cathode: Down over 20%, attributed to exemptions impacting raw material costs.
• Investment Strategy: Scott mentions being out of copper in his commodity fund but anticipates potential upside in the second half of the year.
• Freeport-McMoRan: Jenny suggests investing in Freeport, which showed resilience amidst the downturn.

Notable Quote:
Scott Wapner notes, “This opens the door for quite a bit of upside in the second half of the year.” [44:20]

Final Trades and Closing Remarks Timestamp: [45:38]

The panel wraps up with final investment moves:

• Dominion Energy: Discussed in relation to increased CapEx from data center expansion.
• Agnico Eagle Mines: Reported strong earnings, highlighting divergent performance from gold.
• Ethan Allen: Issued a special dividend following good earnings.

Notable Quote:
Jenny Herring highlights Ethan Allen’s performance: “Ethan Allen, good earnings yesterday. Good enough to issue a special dividend.” [46:06]

Frank Holland concludes the episode by emphasizing the ongoing opportunities and strategic moves in the current market environment, inviting listeners to stay tuned for more insights.

Conclusion This episode of Halftime Report provides a detailed exploration of the tech-driven market rally, examining the performances and strategies of leading companies. The panel offers valuable insights into investment strategies amidst robust AI investments and CapEx expenditures, while also addressing potential vulnerabilities and broader market implications. From the stellar growth of Microsoft and Meta to the cautious stance of Apple and the burgeoning opportunities in private credit highlighted by Jamie Dimon, listeners gain a multifaceted understanding of the current financial landscape.

Note: All quotes are attributed to their respective speakers with corresponding timestamps for reference.