The Record Run 7/15/25

Summary

Halftime Report: The Record Run (July 15, 2025) – Detailed Summary

Hosted by Frank Holland in Place of Scott Wapner

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1. Introduction and Market Overview

Kicking off the July 15, 2025, episode of CNBC's Halftime Report, host Frank Holland sets the stage for a dynamic session focused on the ongoing record run in the stock markets. Highlighting that both the NASDAQ and the S&P 500 are reaching new all-time highs, Holland underscores the pivotal role of bank earnings and Nvidia's significant advancements in China.

Market Snapshot:

• S&P 500: Relatively flat, inching higher.
• Dow Jones Industrial Average: Down approximately 0.5%.
• NASDAQ: Up roughly 0.75%, buoyed by Nvidia's news.

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2. Nvidia’s Strategic Move and Market Implications

Frank Holland transitions to a discussion with Josh Brown regarding Nvidia's recent announcement that it has secured assurances from the White House to resume selling its H200 chips in China. This development is perceived as a potential tailwind for the broader trade environment.

Key Insights from Josh Brown:

• Stock Performance: "Today the stock looks unbelievable yet again, up 4%. New all-time record high over the last couple of weeks. This thing has just gone parabolic once again." [01:50]
• Market Sentiment: Investors have long been wary of Nvidia's ability to operate seamlessly in China. The latest news alleviates some concerns, leading to a surge in stock price.
• Investment Challenge: Despite positive news, "this is a really tough stock to buy today" due to its significant run-up, making it hard for new investors to enter without encountering high entry points. [01:50]

Frank Holland's Follow-up:

• Suggests that while the immediate impact may not reflect on this quarter’s revenue, Nvidia's capacity to contribute to the next fiscal year by fostering Chinese technology built on its infrastructure remains promising. [03:08]

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3. Commerce Secretary Howard Lutnick Interview

Brian Sullivan conducts a live interview from Pittsburgh at the Senator David McCormick Innovation and Energy Summit with Commerce Secretary Howard Lutnick. The conversation delves into the Department of Commerce's role in AI and energy infrastructure development.

Key Topics Discussed:

• AI Standards and Innovation:

  • Lutnick emphasizes the Commerce Department’s responsibility in setting AI, cryptography, and cyber standards to ensure American standards dominate globally. [07:00]
  • Quote: "We try to set the guard rails to make sure that the American standards are the standards the world uses." [07:43]

• Nvidia’s Deal with China:

  • Lutnick explains that while older chips are permissible for sale to China, the newest and most effective chips remain restricted to protect American technological leadership. [08:35]
  • Quote: "We want to keep the Chinese using the American technology stack because they still rely upon it, and that's key." [08:35]

• Tariffs and Domestic Production:

  • Discussion on imposing tariffs on finished goods like steel to encourage domestic production and reduce reliance on imported materials. [11:17]
  • Quote: "President Trump is reversing that trend...Let's bring industry back." [16:46]

• Permitting and Infrastructure:

  • Lutnick addresses the bottleneck in permitting processes that hinder infrastructure investments, emphasizing the need for expedited approvals to attract and retain investments domestically. [13:04]
  • Quote: "We're going to make sure that the states that embrace production now...they're the ones who are going to get the investment." [13:59]

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4. Investment Committee Analysis

Stephanie Link on AI and Infrastructure:

• Highlights the nascent state of AI and the critical need for exponential growth in data centers—from 11,400 current facilities to over 30,000. Emphasizes the necessity for grid modernization and increased power capacity.
• Recommends investments in infrastructure companies like Broadcom, Quanta Services, Eaton, Rockwell, and Vertiv, citing their pivotal roles in supporting AI-driven demand.
• Quote: "If you believe in AI, you have to believe in data centers and the data center growth." [18:12]

Jason Snipe on Infrastructure Plays:

• Points to Google's $25 billion investment in the PGM Intercontinental electrical grid as a catalyst for infrastructure-related stocks.
• Advocates for a balanced investment approach in both direct AI components like Nvidia and broader infrastructure companies.
• Quote: "For me, there's absolutely a...We are at a deficit in terms of the infrastructure build-out for electricity and what data centers are going to need." [19:52]

Jim Labenthal on Big Tech Stocks:

• Discusses the steady performance of companies like Cisco and Microsoft, noting Cisco's recent pullback despite a strong run-up.
• Encourages investors to "ride the trend" with high-quality companies while cautioning about potential seasonal pullbacks.
• Quote: "It's a time that this news needs to be digested by the market." [05:56]

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5. Banking Sector Earnings Review

The committee reviews earnings reports from major banks, focusing on J.P. Morgan, Citigroup, and Wells Fargo.

Jim Labenthal on J.P. Morgan and Citigroup:

• J.P. Morgan:

  • While historically strong, Labenthal is trimming his position due to overexposure despite acknowledging the bank's excellence.
  • Quote: "I don't want to trim [...] It's too much in the portfolio." [28:19]

• Citigroup:

  • Praises Citigroup’s turnaround, leadership under CEO Jane Frazier and CFO Mark Mason, and improving profitability.
  • Highlights reductions in share count and ongoing capital returns to shareholders.
  • Quote: "They're returning capital to shareholders. Share count has decreased 40% over the last 10 years." [28:19]

Josh Brown's Perspective:

• Remains bullish on both J.P. Morgan and Citigroup, citing strong revenue and confidence in management.
• Quote: "I think Jimmy is going to make money with Citigroup." [30:58]

Stephanie Link on Wells Fargo:

• Acknowledges a slight pullback post-earnings but remains optimistic about Wells Fargo’s transition and growth potential.
• Quote: "Loan growth was fantastic. 4%, that's pretty good." [33:24]

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6. Stock Recommendations (Calls of the Day)

Jim Labenthal:

• 3M:

  • Reiterated as overweight by JP Morgan due to strong cash generation and a healthy balance sheet.
  • Quote: "We’re looking for operating margins to expand over 200 basis points." [38:32]

• Otis Worldwide:

  • Endorsed for its stable maintenance revenue, which is less price-sensitive and offers consistent income.
  • Quote: "Maintenance is not optional. It's not price sensitive." [39:21]

Jason Snipe:

• Emerson Electric:
  • Highlights significant demand in the industrial sector.
  • Quote: "Emerson Electric... significant demand for industrial." [43:45]

Stephanie Link:

• American Express:
  • Despite a recent pullback, maintains a positive outlook based on strong net interest income growth and credit quality.
  • Quote: "The consumer is still relatively healthy here." [40:32]

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7. Headlines and Additional News

Pippa Stevens Reports:

• Immigration Policy: Changes to bond hearing eligibility for immigrants arriving illegally, expected to face legal challenges.
• Sensational Trial: Oral arguments commence in a high-profile Colorado case involving alleged murder by poisoning.
• Sirius XM Innovation: Launch of Sirius XM Play, an ad-supported subscription plan aiming to attract new listeners with a lower price point.

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8. Final Trades and Market Wrap-Up

As the episode nears its close, the committee discusses final trades and provides a brief market summary.

• Market Performance:
  • Dow Jones: Down approximately 0.25%.
  • NASDAQ: Up nearly 0.5%.

Final Insights:

• Emphasis on continued monitoring of energy sector movements, AI-driven infrastructure investments, and the resilience of major tech and banking stocks amid evolving market dynamics.

Closing Quote:

• Josh Brown: "You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern only on CNBC." [44:23]

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Conclusion

This episode of Halftime Report provides a comprehensive overview of the current market landscape, with a particular focus on the symbiotic relationship between AI advancements, infrastructure development, and key financial institutions. Through insightful discussions with industry experts and senior officials, the episode underscores the importance of strategic investments in technology and infrastructure to sustain the ongoing record run in the markets.

Transcript

[Frank Holland]

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[Brian Sullivan]

Which are America's top states for business.

[Frank Holland]

Get all the data and complete state by state analysis. See how your state measures up.

[Howard Lutnick]

America's top states for business now on topstates.cnbc.com.

[Frank Holland]

I'm Scott Wapner and you're listening.

[Josh Brown]

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.

[Frank Holland]

Welcome to the Halftime Report. I am Frank Holland in for the judge Scott Wapner front and center this hour, the record run, the NASDAQ and the S&P 500 fitting fresh all time highs as bank earnings roll in and Nvidia scores a major win in China. Our investment committee is standing by to break everything down. Joining me for this hour, we have Josh Brown, Stephanie Link, Jim Leventhal and Jason Snipe. But first, a quick check on the markets. Right now you can see the markets, you know, when we look at the S and P basically flat, just fractioning higher, the Dow pulling about a half a percent. It's really the NASDAQ moving higher up about 3/4 of 1%. Following that Nvidia news. And with that, Josh, I want to come over to you. The Nvidia news that Nvidia says it's getting assurances from the White House it can once again share sell its H20 chips in China. A lot of people see that as a broader tailwind for the quote, unquote trade. How are you viewing?

[Josh Brown]

Oh, look, Nvidia obviously has had this overhang when it comes to the Chinese situation. It's not new. People that have been invested in the stock have understood that it's not entirely clear that they'll be able to operate in China the way they had been. And obviously when news like this comes along, there's an exhalation. People feel better. You could see today the stock looks unbelievable yet again, up 4%. New all time record high over the last couple of weeks. This thing has just gone parabolic once again. It's really, really tough to say even now at this advanced date given everything that's happened in AI. Everything that's happened with some of the other players. It's really hard to say that in video is not still in every bit as competitive a position as they've ever been. They just, they're exactly in the space that you'd want to be if you're an Nvidia shareholder. That said, this is a really tough stock to buy today. So I feel bad for people that are not in it or that got out of it at much lower prices and now are looking at 171 staring them right in the face. But that's the reality. It's a really tough stock to pull the trigger on to the long side given how much it's run up just in the last couple of weeks.

[Frank Holland]

But Josh, doesn't this unlock a new set of revenues? Maybe not for this quarter, this quarter is winding down, but for the next fiscal year and beyond, doesn't it unlock the idea that we're going to see Chinese technology built on Nvidia's infrastructure?

[Josh Brown]

Yeah, I think, look, I think they're the cynic in me would say don't worry about China getting access to GPUs because they can get them from other countries in Asia. And there's probably some truth to that. And I don't know, I don't know whether or not analysts have that in their numbers already, but absolutely, there's a case to be made that you could see a round of estimate lifts happening between now and when they report. Remember, Frank, Nvidia is a late reporter. They're the last of the large cap tech to report traditionally. And there's a lot of time between now and then, even though we're in earnings season now. The thing that's most important to Nvidia, though, more so than this new development with selling in China, is what the hyperscalers say in their reports. And those reports are going to come early. If you look at the way Nvidia stock traded around the reports of Microsoft and Amazon and Alphabet last quarter, you realize that's the real catalyst here. These meta, these companies coming out and saying not only are they committed to the spends that they've already announced, but in some cases we've heard about increased spending. Nvidia doesn't get all of it, but they get a lot of it. So that's, to me, that's really the deciding factor on how this name will trade for the rest of the summer. What do their biggest customers have to say about the demand environment? All right.

[Frank Holland]

With that also, Melius Research Actually upgrading Nvidia from 205 up to 235. Jim and Jason, I want to come over to you guys. Jim, you first. What's your take on this Nvidia news when it comes to this company and is it a read into any other tech plays? I'm just looking at the moves right now. I'm seeing ASML up about 1 and a half percent, Taiwan semi up over 3%. Super micro up over 7% AMD.

[Jim Labenthal]

I mean the whole, the whole semi space is up on this news. And I think just very simply, this is the sort of news that you allow to ride. Obviously we see Nvidia up 4%. I wouldn't be surprised if it continues to go higher. And some of the Nvidia adjacent names, core weaves up very big today, as you can see. And I think what you do here is this is a time in the markets, particularly for the AI semi trade, where you just don't worry about valuation. And that's not a side hand way of saying, oh, I think Nvidia is overexpensive. It's just a time that this news needs to be digested by the market. It probably, probably crescendo for a few more days, you know, after that. This does seem like a market to me that has run very far, very fast. And I wouldn't be surprised if now looking at the market overall, if you at least got a pause, at least got maybe a little bit of a pullback just from buyers being exhausted.

[Frank Holland]

All right, right now Nvidia shares up just about four and a half percent. Now. We're going to have, we're going to have much more in this record rally coming up. But now we want to get to our Brian Sullivan live in Pittsburgh, that exclusive interview with the Commerce Howard Lutnick. Brian, over to you.

[Brian Sullivan]

Yeah. We're here at The Senator David McCormick Innovation and energy Summit at Carnegie Mellon University in Pittsburgh, Pennsylvania. President Donald Trump is scheduled to be here later this afternoon to host a roundtable. You got many companies here. You've got Amazon, you've got Alphabet, you've got Blackrock and many others. ExxonMobil is here as well, along with members of the cabinet, including your next guest, that is the Secretary of Commerce, Howard Lutnick. Secretary Lutnick, thank you for making some time with us here. I mean, what a hell of an event that has been put together in a very short amount of time. We did interview the Secretary of Energy speaking to the Secretary of the Interior. What is Commerce's role in the Energy And AI infrastructure build out. What. What are you. Where do you direct the money and the knowledge base in this scheme?

[Howard Lutnick]

So that NIST is part of Commerce, the National Institute of Standards and Technology. So the key is we set the standards for AI. So we've got the AI Standards and Innovation Institute as part of the Department of Commerce. So we're the driver of AI standards and also cryptography standards and also cyber standards. So those are the key pieces inside of commerce.

[Brian Sullivan]

So commerce. And you forgive my lack of knowledge about the inner workings.

[Howard Lutnick]

Well, but you're with me now, so it's okay.

[Brian Sullivan]

I literally have no idea. I should. Our DC team probably understands this a lot better than I do. So you're setting the rules of the road that will also shape investment.

[Howard Lutnick]

Correct.

[Brian Sullivan]

All the stuff they talk about at halftime report every day. All the companies in AI, they're going to have to follow rules that you and your team are ultimately going to mold.

[Howard Lutnick]

Correct. So we try to set the guard rails to make sure that the American standards are the standards the world uses. Right. That's what we want. We want everyone to use our technology stack our way of thinking about AI and let the world be balanced on ours. Now really, it's a competition between the American standards and the Chinese standards. So we're out there working hard to make sure that our standards, our foundation, if you will, is what the world uses for AI.

[Brian Sullivan]

Well, I'm watching CNBC as well as being on cnbc, and I'm looking at Nvidia getting a deal to be allowed to sell certain chips and do more business into China. That's coming from this administration. Is that a change of heart?

[Howard Lutnick]

Well, it's funny because the Biden administration allowed China to buy these chips last year. So then we held it up. And then in the Magnets deal with the Chinese, we. We told them that we would start to resell them. So remember, these are an older chip. Biden had had them available and we rethought it. But now that Nvidia came out with their newest chip, you realize the newest chip is called the Blackwell. Then they have the H200 and H100. This is like the fourth one down. So the fourth one down, we want to keep China using it. We want to keep having the Chinese use the American technology stack because they still rely upon it, and that's key. So we try to play that balance. We don't sell them our best stuff, not our second best stuff, not even our third best. I think fourth best is where we've come out that we're cool.

[Brian Sullivan]

Well, fourth best is giving the stock a four and a half percent pop today.

[Howard Lutnick]

They could sell a lot of those chips.

[Brian Sullivan]

An over $4 trillion market cap. Right? Which then when Nvidia rises, it's kind of the tide that lifts a lot of different boats. You look at the Nasdaq that's up today. But some would argue, why are we giving China any access to chips? How do we square that?

[Howard Lutnick]

So the idea is the Chinese are more than capable of building their own, right? So you want to keep one step ahead of what they can build, so they keep buying our chips. Because, remember, developers are the key to technology. You want the world's developers to use your tech. So Nvidia is driven to make sure all the developers of the world are still using their technology. So you want to sell the Chinese enough that their developers get addicted to the American technology stack. And that's the thinking. Donald Trump is on it. He thinks about it. And we designed the platform model with Nvidia. Remember, we talked to our companies. The Biden administration sort of hated American companies. And the Trump administration loves them strong.

[Brian Sullivan]

I can't say that.

[Howard Lutnick]

Oh, come on. They tried to break them up and all this sort of stuff.

[Brian Sullivan]

The Trump administration lawsuits on Amazon, you know, Alphabet.

[Howard Lutnick]

But the Trump administration embraces technology companies, and we want to work with them, understand them, and help them succeed.

[Brian Sullivan]

Let's talk about permitting. We're going to hear from the Secretary of the Interior in Power Lunch. I know it's not your purview. That's his. Permitting is everything, because you can get $20 billion invested, a data center here in Pennsylvania. But unless you have a power line to go from the. The power plant to the data center, it's worthless. So when we look at permitting, we think, okay, we want to build power lines that steel, aluminum, and copper. There's some new fears of tariffs on those exact things. Does that hurt or slow down our ability to invest in AI infrastructure? If there are tariffs on the stuff, we need to build that stuff.

[Howard Lutnick]

So let's think steel for a minute. We've all seen a steel blast.

[Brian Sullivan]

We are in Pittsburgh.

[Howard Lutnick]

I fairly know what a blast furnace looks like. It looks like pouring molten lava. Right? That's what. Right. You have to use so much power to melt that iron ore. Right. And the Chinese and the Japanese and the Koreans give that power for free or virtually for free to their steel companies. And then they dump steel on us and put our domestic steel companies out of business. And that's what's happened for years. And decades to the point where if all you do is import steel and all you do is import aluminum and all you do is import copper, how are you going to fight a war? We need steel to be made domestically. And so Donald Trump is saying, I'm going to take that government subsidy off the table. I'm going to put tariffs in to make it equal so Americans build steel here so that if we want to fight a war, we can make our own ships, our own missiles. And that's the key to Donald Trump's thinking, national security here on our ship.

[Brian Sullivan]

But it's not, I mean, these are raw materials. Right. And minerals. Like, it's not just building it, it's about being able to mine it out and take out the iron ore, take out the stuff, the copper from the ground.

[Howard Lutnick]

Oh, yeah. We don't charge tariffs on the raw material. We charge a tariff on the finished good.

[Brian Sullivan]

Yeah.

[Howard Lutnick]

The whole idea is you can bring in the dirt, if you will, but when you try to melt that dirt in a refinery and make a blast furnace, that is the output that we want to make sure we protect. Americans.

[Brian Sullivan]

Let's just, let's role play using like a free example, because I don't want to talk about any specific companies. So let's say Sullivan Copper comes to Howard Lutnick and says, well, Mr. Secretary, I'd like to spend a billion dollars, open some new copper mines, but I got 10 years in the permitting line.

[Howard Lutnick]

Oh, we gotta break that.

[Brian Sullivan]

I'll spend the money, but it's worthless. I can't. You and I talked about this in Phoenix, Arizona a couple months ago. There is that log jam where it doesn't matter. We have $90 billion in commitments being made here at this, at this thing, but none of that money will go anywhere if that last mile is not fixed. And that's all I hear from companies is that last mile is the problem. How do we solve that?

[Howard Lutnick]

Well, President Trump is on it. That's why he talks about the epa. That's why we talk about permitting and regulation. We are going to make sure that the states that embrace production now, now during this Trump administration, they're the ones who are going to get the investment. And if you're playing it old school, slow role in everybody, then other states are going to be successful. So the key is the, you're right, we've got to get those permits out the door. But the key is onshore, get that investment here, and then those states are going to want it to work and they're going to clear the Path.

[Brian Sullivan]

Let's talk about something. But I don't want you to tell anybody. It's just between you, okay?

[Howard Lutnick]

Just between you and.

[Brian Sullivan]

You and I. In the next hour, we're going to be speaking with the governor of Pennsylvania, Josh Shapiro, probably a front runner for the 2028 nomination. Who knows? He's a Democrat. Don't tell anybody, but he's a Democrat. Is he on board? Is he playing? Are we able to cross party lines? Because energy. And that should all be bipartisan, should it not? Shouldn't everybody want to win at AI for the United States, regardless of party affiliation?

[Howard Lutnick]

Look, the Democrats tried to close Anwar. They closed Anwar, right? The big oil in Alaska, that's ours. They close there. They close coal plants, right? They close them. Whereas President Trump calls it, what clean, beautiful coal, right?

[Brian Sullivan]

We need.

[Howard Lutnick]

We need power, we need investments. And we think everyone should be on board. And if a governor's not on board, he's going to hurt his state.

[Brian Sullivan]

Is Pennsylvania on board? We're here. We're here at Carnegie Mellon. It's a beautiful day. We're in Pittsburgh. Is steel, right?

[Howard Lutnick]

They've got the tools. Pennsylvania's got the tools.

[Frank Holland]

Water.

[Howard Lutnick]

Does the governor drive that problem? Permitting to make people successful who want to invest here? The government, the state government's got to make sure that they embrace Donald Trump's vision of onshoring, reshoring and building America. And if they don't, those companies are going to find a nice red state to invest.

[Brian Sullivan]

Well, we are going to ask him in the next hour. That'll be live. So Governor Shapiro will join us as well.

[Howard Lutnick]

That's May's red state. Don't forget. It went for Donald Trump.

[Brian Sullivan]

It went for Donald Trump, but it's a mix. It's got a Democratic governor and maybe the most important county in America, Erie, just north, kind of go a little bit northwest. Ish of here. We're going to hit that stock market. Mr. Secretary, keeps going up. It feels like the market's not believing that the worst of the tariffs is going to happen. Something again, you and I talked about in Phoenix and you've talked about on CNBC with others before. Is the market getting it right? Because a lot of investors are watching the market go up, up, up.

[Howard Lutnick]

President Trump is smashing down the barriers that have held American business back for 80 years. Tariffs were on America, so when we tried to sell elsewhere, there were tariffs. And when they tried to sell here, no tariffs. So our industries went overseas. President Trump is reversing that trend. Zero tariffs away. Those are the deals he's made. Vietnam. He announced Indonesia just this morning. No tariffs there. They pay tariffs here. Switching the asymmetry our way. Let's bring industry back. And that's going to unleash our farmers, our ranchers, our fishermen, and our industries are going to blow out. And that is what the stock market understands. Donald Trump understands.

[Brian Sullivan]

You said in Phoenix that we had, you had a deal in your hand. You wouldn't tell us who you wouldn't tell. I tried, but you wouldn't tell me who the deal is with. Turns out he was with the UK Are you confident we can get these big, the big ones, the big deals done.

[Howard Lutnick]

I have them done. The question is President Trump drives the strongest bargain. He's the dealmaker. He makes the deals. This morning he was on with the president of Indonesia and he makes the deals. That's how this administration works. We let the greatest dealmaker who's ever been in that office, he makes the deals.

[Brian Sullivan]

Commerce Secretary Howard Lutnick. I have the deals done. I have a. That could move the. I think that's going to move the market.

[Howard Lutnick]

I'm good with that.

[Brian Sullivan]

I know you got a panel. The president's going to be here in a couple of hours. Still got a long way to go. Really appreciate your time today, sir.

[Howard Lutnick]

Pleasure.

[Brian Sullivan]

Thank you very much. Frank, I'm going to send it back to you. I wonder if that. We've got the deals done, we'll see if that moves the market. I know your companies, Frank. The ones you talk about, the shippers, logistics, truckers, they have boomed off that market bottom as well. And maybe Nvidia will move a little higher. We'll see what happens.

[Frank Holland]

Yeah, we're certainly watching it right now. Brian Sullivan live in Pittsburgh at Carnegie Mellon. Great interview as always, Brian. Thank you very much. I want to turn things back over to the investment committee now. Stephanie Link, we haven't heard from you quite yet. I want to first get your take on some of the things that we heard from the commerce Secretary, including him saying very openly, kind of mimicking or repeating what we heard from Nvidia, that they want to encourage Nvidia to sell their chips in China. What does that say to you, not only about Nvidia, the stock, but also the quote, unquote, trade.

[Stephanie Link]

Well, we talked a lot about AI and it's in the early innings. But if you believe in AI, you have to believe in data centers and the data center growth. We only have 11,400 data centers in the world. We absolutely have to get that north of 30,000. If you believe in all of this demand between now and 20, 20, 30. And of course you need a better grid. 75% of the grid is over 25 years old. We haven't really spent on the grid incrementally in over 50 years. So you've got to spend there too. And then of course you need power and they were just talking about that and we don't have enough power. So you have to have exposure. Sure. You want to buy Nvidia? I own Broadcom, by the way. Broadcom has outperformed Nvidia over the past year. It's up 64%. And you, if you believe in inference demand from AI, you need custom chips, which they are the number one player Broadcom is. So you could buy either one, you can own either one. I also want to own, and I do own the infrastructure companies because they're going to benefit. So Quanta Services for example is up 50% in the past year. Eaton, Rockwell, Vertive, you have a whole choice of companies to play this theme. You absolutely want to be in this theme one way or the other for the next decade.

[Frank Holland]

Yeah, looking at some stocks right now eating up about a half a percent as I mentioned. Super Micro is up. Actually Cisco's pulling back a bit. Jason Snipe, I want to come over to you, just kind of get your take again on this AI play. Surprised at all to see a name like Cisco, you know, routers, servers and things like that. Actually pulling back, I was checking the charts. Dell pretty much flat right now. Surprised to see we're not seeing a broader impact.

[Jason Snipe]

Well, not really, Scott. I mean, Frank, I'm sorry about that, but so for me, I think as it relates, one of the, one of the things that you know, we haven't spoke about is Google's huge investment, $25 billion in the PGM Intercontinental, which is the largest electrical grid in the country, covers the Midwest, covers the mid Atlantic parts of the parts of the south as well. So for me there's absolutely a. We're at a deficit in terms of the infrastructure build out for electricity and what data centers are going to need. So that's hence a lot of the move in these infrastructure type plays. And obviously the industrial names have grown a lot so far this year. But I think this is a trade that continue, you need to continue to.

[Frank Holland]

Keep on specifically in video and chips. Or are you saying the infrastructure like second derivative plays like Eaton as.

[Jason Snipe]

I think both, I think both can work. And even, even as it relates to Nvidia I'm thinking about, you know, obviously the news that we saw that we heard about earlier. You know, China was an $8 billion hit in this quarter.

[Frank Holland]

Right.

[Jason Snipe]

They're not going to catch up all of that revenue this particular quarter. But going through the rest of the year, being able to now sell these H20s I think is a major catalyst for the stock going forward.

[Jim Labenthal]

Jim, I'm probably talking about it too much, but since you brought up Cisco, I will remark that it's had a heck of a run. I mean it's up 46% over the last 12 months, still very attractively priced. So I do think the last it's really been about a week that it's to going kind of sputtered a little bit. But that's after a solid run from about $55 a share two months ago to now about $68 a share. Estimates are going up. It's priced at about 17 times forward earnings and getting a lot of orders. So there are in addition to in video which I think is attractively priced, but if you're worried about that price, there are names like Cisco out there.

[Frank Holland]

So names like Cisco out there. Josh, when I come back over to you after we heard from the commerce Secretary also talking, you know, quite in detail about power, the needs for power and the fact that he believes that there's kind of a market for power players, whether they go to red state or blue state, they're going to try to seek the most attractive offer. Any thoughts about the energy sector in particular on the back of those comments?

[Josh Brown]

I have an energy position. The sector is not acting well. I think these are very cheap stocks. A lot of people who have avoided the sector would say cheap for a reason. The purpose of, from my perspective, the purpose of owning oil and gas stocks is not necessarily that you're a bull on oil and gas per se, it's that you think these companies profits will translate into increased shareholder value regardless of whether or not the prices of energy break out to the upside or just remain in the same place. So that's kind of where I am. I don't forecast crude oil. I don't have a price target for natural gas. I just think these companies are making too much money to be trading at the valuation they are and they'll get rediscovered. I don't, I have no way of knowing the timetable. The better stocks with an energy are the energy transmission names and some of the select utilities that are highly involved in powering AI and are part of this build out of the new cloud infrastructure. Those Stocks have already worked really well. I don't have any one of them in particular that I'm in or about to buy but it has been a really good place for investors to be within the broader idea of energy.

[Frank Holland]

All right, let's switch gears a bit and focus on big tech right now. As Snipe just mentioned, Alphabet making an announcement they're going to spend $25 billion on data centers in the mid Atlantic area. Link, I want to come over to you. Another name spending quite a bit on AI infrastructure which is meta upgrade today from bank of America going from 765 to 775. Just your thoughts on the stock and this general trend of this build out.

[Stephanie Link]

I'm a huge bull on Metta. This is a company that is just in the driver's seat across the board and all of their businesses, their growing earnings or revenues rather 16% earnings at 25%. They've got an enormous free cash flow. They're going to spend $70 billion on CapEx on all the stuff we were just talking about and like every day they keep on buying a person or they're buying a minority stake in AI in a joint venture. So I love what they're doing in terms of where they're using their dollars because obviously we're all believers in AI. We're all believers in all the things that we were just talking about and all the various different segments and they're going to be a player. And so to me you want to just stay long. It's not even all that expensive. It's about 17 times EBITDA. The average is about 18 times. So you're not really that expensive. But it's certainly a name that is going to benefit going forward. Numbers are absolutely going to go higher after the report.

[Frank Holland]

So what are the name to get to Microsoft hitting a new all time high today. Also getting an upgrade from bank of America head of earnings 585 to 600. I don't know how meaningful price targets are to you Jimmy, you own this name. Just what's your thought on this company as we start to see this, this race really accelerate when I think some people thought it might have been hitting a bit of a pause.

[Jim Labenthal]

Yeah, well I would say I don't think there's anything specifically newsworthy about Microsoft specifically today. So this is an example of when the trend gets going. It is your friend. Just ride it. I can't tell you. None of us on the panel today can tell you how long it's going to go. But Enjoy it while it continues. And by no means am I saying that Microsoft has some trapdoor underneath that's going to open and stock's going to go down to $400 a share. That's not my point. It may be a little bit pricey in the high 30s as a forward multiple. It may give some of that back if you get some seasonality in August and September. But this is the highest quality of high quality companies. It's a stock that you want to own for the long term. I might not buy it at exactly this price.

[Frank Holland]

Well, can I ask you a question? You mentioned that you trimmed Oracle. This is a stock. You're looking at the chart right there from the, from the April low, big run up over the last three months, up 30%. Why isn't this the same strategy? Why not trim a bit off this?

[Jim Labenthal]

Because I don't want to trim everything, you know, it's not a moment where I want to build up some huge cash reserve. I was talking to you about this before the show. I would like to have 7 to 10% of cash going into this earnings season to be able to pick up some names that will indubitably get hit for the wrong reasons during earnings season. But I don't want to go out and trim Oracle, Microsoft in video, all of these stocks, Amazon, Alphabet. I want to let the winners run for the most part. Oracle, nothing personal. It's had one heck of a run. It's basically tripled in the two and a half years that I've owned it. So that was a very ripe candidate.

[Frank Holland]

All right, snap. I'll give you a quick word. We got to get out of here. But Microsoft looking at it trading at 35 times forward earnings. Your thought? Yeah.

[Jason Snipe]

So for me, as it relates to Microsoft, I mean, clearly Azure is a centerpiece for the stock. I mean, it's up 34% year over year, 17% of which is AI related, AI driven. So it just kind of relates back to the story we were talking about in terms of infrastructure. And I and I build and data center build, you know, so I continue to like the stocks, up 20% year to date and they guide to the high end, you know, in the last quarter. So I continue to like this one.

[Frank Holland]

All right, coming up next, the committee's take on banks as earnings season kicks off. Jim, he's making a move in the space. Plus Josh Brown is back with his best stocks in the market. Halftime. Back in just two minutes.

[Pippa Stevens]

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[Frank Holland]

Top States for business.

[Howard Lutnick]

Get all the data and complete complete.

[Jim Labenthal]

State by state analysis.

[Howard Lutnick]

See how your state measures up. America's top States for business now on topstates.cnbc.com.

[Frank Holland]

And welcome back to Halftime. Big bang. Kicking off this earnings season, we're talking J.P. morgan, Wells Fargo and Citi all posting quarterly beats. Jim, you just trimmed J.P. morgan. You also own Citi. Why don't we start with J.P. yeah.

[Jim Labenthal]

Well, look, you know, it's not like I'm trying to tempt Josh into getting on my case. I've dodged plenty of rocks on the show. Maybe that'll happen here. Nothing negative about JP Morgan. I've been overweight the financial space for quite some time. JP Morgan has been fabulous and by virtue of its returns, it's simply too much in the portfolio. I'm trimming it. Still think it's a fabulous stock, so I'm owning it. On the other hand, I'm not trimming Citigroup, which is a bigger position than JP Morgan because I feel that for many years it has been undervalued. In fact, it's fit for it's hit a high today that goes back to the great financial crisis. Since the great financial crisis, it has traded most of that time below tangible book value. And to use a phrase that we often use on this show, you know what? It's deserved to trade at a cheaper valuation than everybody else. But for the last couple of years, it has been more than pulling its weight. It has been turning itself around. Jane Frazier, the CEO there, Mark Mason, the CFO, are doing a fabulous job. They're returning capital to shareholders. Share count has decreased 40% for 0% over the last 10 years. They're going to buy back another $4 billion this quarter, which is 2 1/2% of the market cap. The expenses are going down, profitability is going up. There's a lot to like at Citigroup.

[Frank Holland]

All right. Citi had a new 52 week high as well. But I think you're trying to bury the lead. Josh, got to come back to you. What do you think about him trimming his JPM stake right now for it, against it? Look at his face. Look at his face. Well, let's just talk about this for a second because you make the face, the people want to see the face. Josh, the quarter was really driven by investment banking and trading revenue. Go ahead.

[Josh Brown]

I don't. Yeah, I don't see how you could look at a chart of Citigroup and not see what Jim sees. This stock is going higher. I think it's going to 100 bucks. You mean J.P. so it looks outstanding. Citigroup. It looks outstanding. Tactically, I don't know. I don't own it personally. It looks outstanding. And if I weren't so heavily invested in JP Morgan, I would probably buy it. I think, I think Jimmy's going to make money with Citigroup. And when I look through the details of that report, and I'm not somebody that follows Citi closely, what stood out to me, the most important thing is $84 billion in revenue for the full year, which is the high end of Citi's guidance, if you know the history. Citi is not a company that has had any right historically to give guidance at the high end ever.

[Frank Holland]

Okay?

[Josh Brown]

So that's where they are. And I like that confidence. And they have done a lot of the right things over the last few years. Now you're starting to get credit for it as an investor. So I like what Jimmy saying as.

[Frank Holland]

Far as Josh, but what about him trimming J.P. morgan? That's what we really came to you to talk about.

[Jim Labenthal]

It's okay. I can take it.

[Josh Brown]

Well, well, Frank, Jimmy could sell J.P. morgan. The world needs ditch diggers to.

[Jim Labenthal]

Great wine Caddyshack. We all love it.

[Josh Brown]

Let me, let me just, let me just say that. Let me just say this.

[Frank Holland]

But, but Josh, what's the argument against Truman right here? The stocks had A big run up from the April low. Two very strong quarters really driven by volatility. A lot people of think that volatility is going to ease in the back half of the year.

[Josh Brown]

I think I'm just a different investor than, than, than Jim is in this, in this regard. I own JP Morgan, I swear to God, since the London Whale. Okay, Frank, you might have been in college. I'm not, I'm not ever selling like I have dividends, reinvesting. This is just not, it's just not the way that I own certain stocks that are my core positions. I really don't care if it underperforms Citigroup for the next 90 days. I have nobody to answer to in that regard given how much this stock is up. So I accept the premise that there might be more short term upside in Citi than JP Morgan, but it's a forever position for me. So there's really no debate. I don't think labenthal is doing anything wrong. He's got the way he manages money in his strategy. I have mine.

[Frank Holland]

All right, link, we're going to come over to you. I'm going to Google London. Well, I don't know what that means, but I'm looking at Wells Fargo right now. Shares down more than 5% after their earnings. Your take on the quarter and just the stock.

[Stephanie Link]

I still like the stock very much. I like the turnaround story. They are in a transition post the asset cap lift. They're going to use that money and lend and grow and increase market share. So they have a little bit of a blip today with net interest income, especially at the same time because they lowered on net interest income at the same time. JP Morgan raised net interest income. Citigroup raised to the high end net interest income. So it just by comparison just doesn't look good and it's not good to lower. But I do think they can make it up when they see better fees and they did see better fees in the quarter. They had good credit cost provisions, efficiencies were ahead of plan. So to me, and even loan growth was fantastic. 4%, that's pretty good. So to me the Stock ran up 31% in the past month. It's given back a little bit. Banks always trade a little funky around earnings on the buyer.

[Frank Holland]

I want to leave it there. Wells Fargo shares pulling back down more than 5%. And with that we get over to the headlines with our Pippa Stevens back at CNBC hq. Good afternoon, Pippa.

[I]

Hey, Frank. Immigrants who arrive in the US illegally will no longer be eligible for bond hearings as they fight deportation proceedings in court, according to multiple reports. The changes were detailed in a memo last week from the acting director of ice. The new policy is expected to face legal challenges. Oral arguments will begin today in the sensational trial of a Colorado dentist who is accused of killing his wife by poisoning her protein shakes with cyanide and an ingredient in over the counter eye drops. Prosecutors also allege James Craig later tried to pull pay someone to kill the lead investigator on the case. Craig has pleaded not guilty. And Sirius XM is betting on advertising to capture new listeners. The radio company launched its first ad supported subscription plan today called Sirius XM Play. It's a cheaper option than its long standing ad free offering coming in at $7 per month. Frank, back to you.

[Frank Holland]

All right. I'm Pippa Stevens live from CNBC hq. Pippa, thank you very much. Alright, coming up next, Josh Brown is ready with his best stocks in the market. He's highlighting a few top names on his list ahead of earnings this week. Halftime's back right after this.

[Brian Sullivan]

Which are America's top states for business.

[Frank Holland]

Get all the data and complete state by state analysis. See how your state measures up.

[Howard Lutnick]

America's top states for business now on topstates.cnbc.com.

[Frank Holland]

And we're back on Halftime with Josh Brown's best stocks in the market. Josh, you got two names that you want to highlight ahead of earnings this week. We're talking Netflix and Interactive Brokers. Let's start with Netflix.

[Josh Brown]

Okay, so Netflix is Thursday after the market closed the streets looking for $11 billion. That would be up 15 and a half percent year over year on the revenue side. And earnings $7.08. We have, excuse me, the earnings number would be up 15 and a half percent year over year. We've been writing about the stock positively all spring, all summer in the Best stocks column that we do for CNBC Pro. And I own the stock. Personally, I probably would not be a buyer ahead of this number. It's not that I don't think it will be good. It's that I think it's very possible. You get to sell the news reaction here given how good the price action has already been. I'm planning to stay long. This stock is up 45% year over year. So I just think like part of it, part of the equation in best stocks in the market parlance is to just be aware of what the momentum is here and how much of that news flow might already be priced in. So if I'm not In the stock. I'm a wait and see and maybe trade the reaction. If Netflix for whatever reason does a great number but the market's not that excited about it because they already knew it was be a great number. That might be a great opportunity to be a buyer if you're not already long. Interactive Brokers is a different setup. I think this is a potential breakout in progress. We don't know yet. Of course the quarter is going to be really important here. But for me I would take this risk going into the print. Look at the way Robinhood has been trading, understand how excited the investor class is about the markets and it's pretty easy to see a scenario where IBKR puts up another beat on new accounts opened. That's like other than the earnings of the revenue, that's really the most important metric. The stock itself is emerging from a cup and handle pattern. You could see it clearly when you look at a one year chart. RSI is 71. Some would say that's a little overbought. I don't see it that way. I think new highs should be accompanied by high, by a high momentum. So I like it here despite the fact that it's been going up. And the most important thing to understand is this is 55% retail, the commission mix here. So if you think Robinhood is up for the right reasons, given the momentum amongst retail traders, you should be able to extrapolate that and see a better than expected quarter coming out of interactive brokers as well.

[Frank Holland]

All right, Josh's best stocks in the market. We're talking interactive brokers and Netflix. Jason, want to come over to you. You own Netflix as well. What do you think about Josh's thesis and the stock just from your own point of view?

[Jason Snipe]

Yeah, I mean I couldn't agree more. Obviously the stock has run a ton so far this year, up 40 plus percent year to date. They had a great quarter last quarter. I think one of the things that I'm following I think password sharing and ad supported tier behind them. In terms of catalysts, I'm looking towards operating income. They also plan on spending $18 billion in capex, you know, for content spend this year. So let's see how that plays out, you know, through the second half of this year. But I continue to like the stock and I stay long.

[Frank Holland]

All right, Netflix shares pulling back today down about a half a percent. Coming up next on Halftime, we have our calls of the day. We'll be right back. And welcome back to halftime. It's time for our calls of the day 3M reiterated as overweight over at JP Morgan. Really citing strong cash generation and a relatively clean balance sheet. Link, I want to come over to you. You own it.

[Stephanie Link]

I do. And the stocks had an amazing run. It's up 52% in the past year to trade the 20 times earnings. Two years ago when I was buying it, it was trading at 13 times earnings. But the turnaround is still alive and well. We're looking for operating margins to expand over 200 basis points in the upcoming quarter and gross margins to expand over 100 basis points in the upcoming quarter. And it's important because a turnaround really is indicative of what you can do on the margin front until you can see the growth. And that's going to be the other question. They've got a whole bunch of new products. Does it lead to better organic growth? I think it might, but we might have to wait one more quarter for that. So I like the story. I wouldn't, I wouldn't be adding to it here, but on a pullback, I certainly would.

[Frank Holland]

All right, 3M reports on Friday also go to JP Morgan upgrading Otis Worldwide to overweight. Josh, you own this one?

[Josh Brown]

Yeah. Look, this is a name that, that if you look at the impact of tariffs during the last trade war in 2018, it was DE minimis. It cost them a few million dollars. The thing that people don't understand about Otis, yes, they know they make elevators. The real business here is maintenance. Maintenance is not optional. It's not price sensitive. If buildings install elevators, those elevators must be maintained by law. And that's where the net income growth is coming from in the Otis story. It's where the profits are. So I'm long the stock, it's been on the best stocks in the market list. I think it punches higher from here. And happy to be long.

[Frank Holland]

All right, want to move on to American Express. Downgraded to neutral at moness. Jason, you on this one?

[Brian Sullivan]

Yeah.

[Jason Snipe]

So XP is up close to 6% so far this year. I think net interest income growth has been a good story for them in years past. Cross border travel is obviously slowed. Some credit quality is still strong. You know, but I think a little bit of the concern for me is a rising cost of rewards. And you know who they cater to that, that surging millennial. Older millennial. So continue to like the stock. You know, I think the consumer is still relatively healthy here. So I continue.

[Frank Holland]

All right. Right now pulling back about 2 1/2 percent. Coming up, a new partnership for Uber. The committee takes it. Committee's Take Coming up straight ahead. Welcome back to Halftime. Uber is partnering with Chinese tech giant Baidu to bring the company's autonomous vehicles to Uber's platform outside the US and in mainland mainland China. Nearly everyone on the show today owns Uber. But, Josh, we're going to kick things off with you.

[Josh Brown]

Look, the Uber strategy, in my view, is the strategy that's going to win autonomous taxi, period, end of story. If you're the consumer and you want to be picked up from somewhere, the three things that you care about the most, ease of use of the app, how quickly can the driver get there, and is it a reasonable cost? If you're doing standalone autonomous, it's going to be a really long time before you could be the fastest car to arrive. There's just not enough of them on the roads. Uber has said we will work with anyone that wants to put a network of autonomous cars on the road. And the reason why these companies want to work with Uber, including Baidu, is because it's instant ridership. This is the thing I try to explain to people who don't know anything. When you think about what the typical ride is in the United States, it's five miles and it's $12. And the typical, the typical car is doing 23 of those trips a day. Right now, the cars that let's say Waymo uses, I think it costs him $150,000 per car. Let's assume it's Alphabet. They will find a way to get that price lower. Let's say they get it to 50,000. Even still, how much time and how many days, how many rides do you need for a break? Even on that? So there will be very few standalone autonomous networks. Waymo is probably going to be the biggest one. Uber is going to work with everybody. Volkswagen made Mobility, Pony, AI and Waymo, and I think they're going to win with that strategy of inclusiveness rather than just our own cars. In the meanwhile, while we wait for more autonomous rides, they still have millions of human drivers ready to get you whenever you need to be gotten.

[Frank Holland]

Link your take on this new partnership.

[Stephanie Link]

Well, obviously it is very powerful. The market right now, today, the total addressable market is 1.5 billion. It's headed to 13 billion by 2030. That's a 35% CAGR. So the fact that they're going to be one of a few in this massively growing end market is positive. But I'm with Josh. I mean, like, they. We have a long way to go and they still have a great business in ride sharing. In food delivery, in new products, making their their apps more easy, accessible and that sort of thing. So I like it a lot. I think we're in the early innings. It's up 50% year to date though. I just wouldn't chase it at this moment.

[Frank Holland]

All right, take a look at Uber shares pulling back about 1% right now. Stay with us. Final trades. They're coming up on halftime. And we are back on halftime with final trade. Steph Link, you're up first by Wells.

[Stephanie Link]

Fargo on the weakness.

[Frank Holland]

Josh Brown.

[Josh Brown]

Toast breaking out new 52 week high. What's up?

[Frank Holland]

Jason Snipe, Emerson Electric. Significant demand for industrial Jim Labenthal with the Last Word.

[Jim Labenthal]

Walt Disney Company. You know, it's pulled back about 4% from a recent high over the last week, week and a half. But I think that sets it up for the next leg higher.

[Frank Holland]

All right. With that, we're taking a look at the markets very quickly before we let you go over to the exchange. Kind of a mixed picture right now actually seeing the Dow hit, I believe it's lows today down about a quarter of a percent. The NASDAQ up almost a half a percent. That does it for halftime.

[Josh Brown]

You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern only on CNBC.

[J]

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 half time report participants consider reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy and it should not be relied upon as such. To view the full Halftime Report disclaimer, please visit cnbc.comhalftimereportdisclaimer.

[Brian Sullivan]

Which are America's top states for business?

[Howard Lutnick]

Get all the data and complete state by state analysis. See how your state measures up America's top States for business now on topstates.cnbc.com.