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Halftime Report
Trading Around the Unsettled Market 2/24/25
00:44:20
Scott Wapner and the Investment Committee debate the unsettled market and what it means for you money. Plus, the Committee detail their latest portfolio moves. And later, the desk picks through some of the most overbought and oversold stocks in the market. Investment Committee Disclosures
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- [00:00]
Bank of America Representative
What if your limited inventory had unlimited potential? What if your biggest risk was not taking one? What if you could make every move matter? Bank of America's business solutions can help bring your biggest what ifs within reach. Find out how our digital tools, cutting edge insights and trusted expertise can work for your business. What would you like the power to do? Visit bankofamerica.com bankingforbusiness to learn more. Bank of America is proud to be the official bank sponsor of FIFA World Cup 2026.
- [00:32]
Scott Wapner
Hello, I'm Ben Rizzuto, wealth strategist at Janus Henderson Investors.
- [00:37]
Joe Terranova
Is a brighter future possible?
- [00:38]
Scott Wapner
At Janice Henderson we think it is. We've worked to help clients achieve superior financial outcomes and fulfill our purpose of investing in a brighter future together. We never forget that this means our thinking and our investments are helping to shape millions of futures. At Janus Henderson, we're committed to helping you invest in a brighter future. The Learn more go to Janice Henderson.com I'm Scott Wapner and you're listening to CNBC's Halftime Report, the podcast the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in. All right, Carl, thanks so much. Welcome to the Halftime Report. I'm Scott Wapner. Front and center this hour, the state of stocks, the markets, they still remain unsettled. How about Palantir today down another 8%. We're watch watching it closely. We'll trade all of it with the investment committee. Joining me for the hour, Joe Terranova, Anastasia Amoroso and Steve Weiss. We will check the market. Some interesting price action at the moment too. Dow's positive, the S and P barely going positive. Been an unsettled morning. There's the Nasdaq which is negative. Joe, we have our mind on the Momo trade because these momentum names which some had suggested maybe that had run its course, the unwind still looks ugly today. You look at some of these names. I mean Palantir is down again. CrowdStrike was down sharply. Vertiv, Arista, Applovin, Robinhood. A lot of these names that have been right there in the mix are getting hit again.
- [02:09]
Joe Terranova
And the fourth quarter strong momentum winners continue to pull back. You see price retreating. Palantir testing the $90 level. I still think there's potential here for Palantill to fall further towards that 84, $85 level. I think if you are utilizing what's going on in the momentum factor as a referendum for the overall market getting binary, bullish, bearish markets going down 100 handles or it's going to return to its prevailing bull trend. I think that's a mistake. I don't think that's the game you want to play. I think we are in the middle of a process where money continues to rotate and the money is rotating because we lost leadership five days ago. Momentum was the leadership in the market. Normally what happens when you lose leadership is the market goes through a very convulsive period where it tries to find where the next leadership leg is going to come from. So while momentum is pulling back, you're seeing the quality factors working. You're seeing that health care stocks are performing well. You're seeing some financials that are actually starting to work. Today we're going to hear what Nvidia earnings look like on Wednesday. Let's keep in mind Goldman Sachs prime brokerage desk reports hedge fund exposure to MAG7, lowest level since 2023. It's important because in that process of rotating capital after Wednesday, do we go back to the Mag 7 again? I think that's what's going to be most we will see.
- [03:39]
Scott Wapner
I mean you have small caps, Weiss are in correction. There's a lot of DC noise tariffs, doge geopolitics that might be impacting sentiment somewhat. You have growing questions about the consumer, the direction of the economy, whether rates are starting to go down for the wrong reason. The continued momentum unwind as we begin our show with Speaking of you trimmed Vertiv, which is right in that mix. Vertive last week was down 15%. You had added to it a number of times over the last months and now you're trimming it. Why now?
- [04:13]
Steve Weiss
I talked about this a little bit last week is that and the Microsoft announcement aside because we don't know what's behind that. We just mentioned something on air.
- [04:22]
Scott Wapner
What do you mean the data center lease thing.
- [04:25]
Steve Weiss
Yeah.
- [04:25]
Scott Wapner
They strongly refuted that by the way. I understand that it wasn't their announcement.
- [04:29]
Steve Weiss
I understand.
- [04:29]
Scott Wapner
Right.
- [04:30]
Steve Weiss
I understand. And but the way I look is I see so many deals on data centers each week that the undercurrent is starting to be the narrative is are we building too much capacity? That's number one. Number two, Verdevin, you can ask them but they won't tell you how much they source from China. So with tariffs going on to China with potential disruption of that supply chain, I just thought it was prudent to take some off the table. I'm still there Candley in the 80s today. If I were quicker I would have bought some back because I still think it's a Solid company valuation has now become reasonable based upon their growth and I don't expect to see cancellation of orders. But we also saw only a one to one book to Bill should have been a little higher. So. So that's why verdict in terms of the overall market. I think stagflation is a real risk. I think the market will start talking about stagflation just to remind viewers when prices go up and the economy goes down. I don't know if people caught up. Steve Cohen said look if nothing else we're taking a lot of money out of the government budget. We're reducing a lot of spending and that can't do anything but slow down the economy.
- [05:38]
Scott Wapner
Said he was this was down in Miami. You're referring to last week where Steve Cohen basically was like I'm feeling a little worse about the economy now just given all the stuff that's out there. Thinks that you know the best returns may be already been realized right in the market. You've had Ken Griffin largely talking about the same thing. Just elevated uncertainty because of what he sees coming out of D.C. that maybe he didn't expect to this degree.
- [06:02]
Steve Weiss
So and when you take a look at that and you play it through for CEOs to invest, they've got to know what the rules of the road are. And when you have executive orders, it doesn't give you the same clarity as legislation does because legislation has the background to what what drove the legislation, what the logic was. And it also talks about the enforcement. You've none of that here. So you've got, you know, really wholesale cutting of jobs. Look, the government's bloated, unbelievably bloated, you know, and it's good to attack it. But you need a strategy. And until that strategy is communicated and transparent, then you're out of luck.
- [06:39]
Scott Wapner
Are you. I mean it is your vertive move. I know you got a little granular on the vertive market call. It feels it has to be.
- [06:50]
Steve Weiss
I've been selectively as you know cutting exposure over the last month or so and this is just more of that. I don't, I don't know when you want to talk to my other moves.
- [06:59]
Scott Wapner
But I'll get to those, you know as we go through some of the other.
- [07:02]
Steve Weiss
So just one final point. Joe talks about health care. I'm on the board of a health care company and it's complete disarray. They cut 40% of their AI team to research things they, they put on, on the device side maybe on the farmer side too. All upcoming meetings have been postponed so you just don't know what the approval process.
- [07:26]
Scott Wapner
Well, even so, you can't look at, you can't look at health care and say hey, but health care is up because you can look and say hey. Well health care and Staples are up. It's like a defensive posture to the market which people have been speaking about anyway. Right.
- [07:41]
Joe Terranova
Equality.
- [07:41]
Scott Wapner
It's, you know, like discretionary coming down. And if you're the only two, two sectors that have only really done anything over the last month are health care and Staples. And you Finance is up a little bit. Yeah, but barely, they're barely green. The ones where you've had any kind of return are the, some of the more defensive places in this market.
- [08:00]
Anastasia Amoroso
Yeah, defense has definitely been the name of the game this month. And you know, I agree with stakeholders believe that there is definitely more headwinds that are starting to form. I mean you mentioned Doge and you know, it's true that last year for example, a lot of jobs were created in government and maybe that's not going to be the case this time around as well. You know. And Scott, you and I have talked about this on prior shows, which is before we got the benefits of deregulation, before we got the benefits of tax cuts that are anticipated. We're going to get all these tariff headlines and that's exactly what's been playing out. But where I kind of diverge a little bit, Steve, with you is that I don't actually think we have the stack floating here that is here to stay and not yet. Well, last week we sort of had this, you know, this flavor of stagflation where you've got inflation fears that flared up. We've gotten growth fears that really came to the fore. But I think this week what investors are likely to do is they're going to look at hard data. And we've got the core PC on Friday which should come down from 2.8% to 2.6%. And if I look at the same retail sales that people kind of didn't like, the retail sales were actually up 4, 4.2% year over year. So I don't see much problem with growth when we're pacing about 2.3% GDP growth, which is the same as last year.
- [09:07]
Scott Wapner
You know, if you, if you, if you're fixated on what's happening with a lot of these momentum names, the Robinhood's of the world, the App Lovins, which continue to get upset. J.P. morgan had the following to say about the unwind that really was witnessed last week but is now bleeding into this quote. While the moves felt very quote, unwindy, we failed to see panic selling. Crowded positions are most at risk. While the beta and momentum unwinds are largely complete, they don't really feel like they're largely complete. By the way, Alex Karp of Palantir speaking at the New York Economic Club and we're going to monitor that for any news that that might come out of there. Not necessarily a news making event, but nonetheless his stock is probably today the most closely watched one in the market. Nvidia reports on Wednesday. But Palantir had such a tremendous gain and now it's having such a tremendous unwind. Tom Lee says four reasons we view last week's 5% decline in momentum as just a quote, flesh wound. Well, Nvidia reports this week he cites that likely a positive event. PCE talks about that too. Likely affirms inflation tracking lower. That's what you cited. If DOGE leads to an economic softening, you're going to get a increase in the odds of a May rate cut. Fed put and then momentum. Yes, it's seen a decline and it has in the past, but each staged a recovery. What do you think?
- [10:34]
Steve Weiss
So it's like any other piece of data. You can read it one way, somebody else could read it another way. There are other headwinds. When you're seeing the massive job cuts that you're seeing from the government which again they could be deserved and you're seeing Starbucks lay off people, you're seeing bad news in luxury. 50% of all of all spending is luxury spending by a top 10% of wealth in this country. So you can't rely on the numbers. But you know when you're also seeing that Medicare and Medicaid are 40% of the mandatory spend of the US budget and the largest budget spend period, that that's going to cut jobs. When you cut that, you don't know how it's going to cut it. It's going to mean people have to spend more for their own care. So all those, all those headwinds could offset all that. I don't think they surprise if PC ticks down. That's in the market. I don't believe that's an issue. But the Fed also said or hinted at least we're going to take to account tariffs and economic policy decide. So that may keep a little race.
- [11:41]
Scott Wapner
But what about the point that that Tom Lee makes right first and foremost is that Nvidia is this Week. Okay. And that is going to my words, not his save the day.
- [11:51]
Joe Terranova
Well, you're going to hope that it saves the day. And this is, look, we are where we are today in 2025 because of earnings, plain and simple. Earnings were the catalyst to get us the appreciation that we witnessed so far in 2025. So Nvidia has the ability to reverse some of the negative momentum, negative sentiment that has crept into the market here over the last several days. I really don't think it's about Nvidia's fundamental outlook. I think it's about the reaction to in video and the effect on the rest of the market that overall is going to matter.
- [12:24]
Scott Wapner
Dan Ives says it should. These are again, he put out a note today. It should calm the nerves of investors.
- [12:30]
Anastasia Amoroso
If it could stop the selling that we've seen in tech.
- [12:33]
Joe Terranova
Well, if it's going to calm the nerves of investors, okay, that's fine. But you have to, you have to again look at momentum right now is driving the tape. The unwind in a lot of these momentum names is dictating where price is going. But let's understand something. Applovin, Palantir, they're not even back to their 50 day moving average right now. Vertiv, which you sold 30 days ago, Vert have made a 52 week sell at all. It's now, it's now below its 200 day moving average. So why do I cite that? Because in the case of Palantir, in the case of Applovin, the longer term non discretionary institutional capital, they're not selling yet. They don't have the reason to sell yet. Vertiv, they're going in and selling.
- [13:18]
Steve Weiss
So I disagree with that. Joe, they do have a reason to sell moment.
- [13:22]
Joe Terranova
The reason to sell.
- [13:23]
Steve Weiss
The reason to sell is that the valuations were agreed greedy.
- [13:26]
Joe Terranova
That's just, that's just Joe, statistically incorrect. Your momentum from Steve is statistically incorrect. A non discretionary price driven momentum fund is not factoring in valuation.
- [13:37]
Steve Weiss
They're not Joe, I'm a show investor. You're institutional.
- [13:41]
Joe Terranova
You're not Steve, you're not a million, you're not a multi billion dollar institutional investor.
- [13:47]
Steve Weiss
Don't describe.
- [13:48]
Joe Terranova
That's what I'm talking about.
- [13:49]
Steve Weiss
Ken Griffin is. Steve Cohen is okay. And so are many others that.
- [13:53]
Joe Terranova
How do you know, you don't know what they're doing.
- [13:54]
Steve Weiss
I hear what they're saying.
- [13:56]
Joe Terranova
You don't know what they're doing at the moment.
- [13:58]
Steve Weiss
Okay, what do you think they're doing? You think they're coming out and saying that we've got all these headwinds. I'm worried about the economy and they're leveraging up to overvalue stocks.
- [14:07]
Joe Terranova
That is their individual macro view. They have their macro view arms their equity. They have a team of strategies that is managing multibillion dollar portfolio polios.
- [14:19]
Steve Weiss
Joe, with all due respect, you don't know I work for Steve Cohn. Okay. There's one risk manager there statistically with.
- [14:25]
Joe Terranova
All due respect in this case you don't know.
- [14:27]
Steve Weiss
Well that's, that's actually not accurate.
- [14:29]
Scott Wapner
Okay. Anastasia, do you know?
- [14:31]
Anastasia Amoroso
Well I think look at the prime.
- [14:33]
Steve Weiss
It's your momentum.
- [14:36]
Bank of America Representative
All right.
- [14:36]
Scott Wapner
Fundamentals you can do do your thing out on the street. When we're done, we're going to hug. Anastasia.
- [14:41]
Anastasia Amoroso
Just a little bit of data. Just a little bit of data. I think you know part of the reason why momentum stocks have been selling off is because hedge fund managers in aggregate have been trimming them. In fact we had the largest TMT did grossing according to Goldman didn't point.
- [14:53]
Steve Weiss
Out that data himself but he says they're not selling. On the other hand, this is brokerage at Goldman Sachs shows they are.
- [15:00]
Anastasia Amoroso
Well said. For one, for one of the, for one of the books we're seeing the largest grossing since July which is also the largest in the last five years. It's not the only data point. We also see it in retail investors for example. They're not as actively stepping in and trading some of these stocks. So you put all that together and then if you look at the A I bull bear spread is it it's approaching the 10th percentile which we haven't seen in quite some time. So it seems like a whole cohort of investors have gotten incrementally more bearish on tech. To me though Scott, I think that's an interesting and constructive setup for Nvidia because I think they have the opportunity to surprise to the upside and if I think if anything over the last couple of months the total addressable market for AI has expanded. That's what they're likely to tell us.
- [15:43]
Scott Wapner
So maybe they've gotten more bearish on mega cap tech, but they don't appear to be more bearish on tech. If you look at for example as Tony Pascarello points out, who I will point out by the way is head of hedge fund coverage at Goldman Sachs. He knows more than both of you guys because he's talking to these folks, these institutions folks are telling on in every second year, whatever. Okay. And the fact of the matter is that the equal weight NASDAQ has performed really well year to date. Don't necessarily look at the top which he suggests has come come off the boil but if you look at AI software is up 14% cyber is up 13, Internet's up 10. Analog semis are up 8. The equal weight index is up 6% that's equal to last year's give me.
- [16:35]
Steve Weiss
Entire return where what would they up three weeks ago They've come a moment.
- [16:40]
Scott Wapner
What is a moment in time? It's your date let's call the year to date is a moment in time. I mean you see what the trends of the market are. It's okay to talk about a moment in time.
- [16:48]
Steve Weiss
That's my point. The trends have been down. We've seen cyber come down. We've seen every sector you mentioned come down.
- [16:54]
Scott Wapner
Yes, last week when you had a.
- [16:56]
Steve Weiss
Momentum on station I'm looking to the future and I see headwinds now look, I've still got decent exposure. I have built a lot of cash so I don't think we're going to zero and frankly if you go back to JP Morgan comment I'd rather see panic selling because when I see panic selling I know it overshoots where the reasonable valuation market should be.
- [17:15]
Scott Wapner
Why would you have panic selling you I'm just saying like of all of the negative things that anybody can bring up. Oh, I'm tired of the tariff talk Doge headline du jour geopolitical geopolitics. We're talking about busting alliances that we've had for decades. Mike Wilson still calls the S and P the highest quality index with the best earnings growth prospects quote it's premature to conclude the rotation away from the US is sustainable. JP Morgan today quote we do not advocate an underweight US position as we still see wide growth in earnings differential versus the rest with tariff escalation a wild card. Everybody knows I agree with all that.
- [17:52]
Steve Weiss
We're not targeted opposite ends here but what I'm saying is is that JP Morgan's comment is no panic so there shouldn't be any panic selling. My only comment is when there is panic selling on an event that's when you want to buy. When it's a slow drain down like this, that's when you want to be.
- [18:09]
Scott Wapner
A little true but there are different magnitudes and I think colors to big sells the the carry trade on wine good example it took the market down largely right. That was a market event. Panic selling market went down. Was that like in August 1st Monday of August or whatever that was. That was a panic selling day. That. That unwind caused a panic selling day. What happened with momentum? What happened with. I know, but what happened with momentum? That's just a factor that unwind. The whole market didn't get go crazy.
- [18:43]
Steve Weiss
I think it's a reset evaluation for that.
- [18:46]
Scott Wapner
A lot of things.
- [18:47]
Steve Weiss
So App lovin again, egregiously overvalued. Palantir egregiously overvalued. The CEO himself is saying that by putting in a selling program.
- [18:57]
Scott Wapner
Do you think the S and P S and P at 22 times is egregiously overvalued?
- [19:02]
Steve Weiss
No, I don't.
- [19:02]
Scott Wapner
That's my point. We're talking about a factor of.
- [19:06]
Steve Weiss
Wasn't clear.
- [19:06]
Scott Wapner
That's why. That's. That. That's. We're talking about a factor in the market.
- [19:10]
Steve Weiss
Right.
- [19:10]
Scott Wapner
That obviously went straight up and to the right, which is now getting tested.
- [19:15]
Steve Weiss
Let me just make this very clear, okay? There are times to be all in on the market and there are times to be. I'm going to sit back and see how these things play out. You contribute to throwaway headlines and so what? They don't mean anything. I'm telling you, as a bottoms up analyst that looks at tons of different data points, this is a time to be cautious. Now don't take it from me, take it from Ken Griffin, take from Steve Cohen, take it from whoever you want. But any experienced investor who's been through cycles know there's time to play and there's a time to cash in your chips on a little bit.
- [19:49]
Scott Wapner
Okay, so is the excess.
- [19:50]
Steve Weiss
Let me ask you, wait.
- [19:52]
Scott Wapner
Is dramatically upping your exposure to Chinese tech because you didn't cite him, Is that cautious? Is that cautious?
- [19:59]
Steve Weiss
Again, just.
- [19:59]
Scott Wapner
I know, I know. Nobody knows.
- [20:01]
Steve Weiss
I'm not going to answer that question.
- [20:03]
Scott Wapner
Is that cautious?
- [20:04]
Steve Weiss
I'm not going to answer the question that way because that's an unfair question. Yes, I. Dramatically.
- [20:09]
Scott Wapner
You talked about him in his hot tub last week. Now you can't answer.
- [20:13]
Steve Weiss
I can answer the question, but I'm going to ask the question more. I'm going to answer it more intelligently than you asked it.
- [20:20]
Scott Wapner
Okay?
- [20:20]
Steve Weiss
So here's my answer.
- [20:21]
Scott Wapner
You know what?
- [20:22]
Steve Weiss
Yes, I do.
- [20:23]
Scott Wapner
You can help yourself. You can't help yourself by acting that way when somebody questions you on anything.
- [20:29]
Steve Weiss
When you give me a question like that, dramatically. By you giving me the leading question, first of all. That. You want to fill your narrative. Fine.
- [20:37]
Scott Wapner
I'm just telling you. You know what? Everybody up here is tired of that B.S. okay, if you can't have a simple conversation without whatever, without insulting people, then just be quiet. Just move to the other chair.
- [20:49]
Steve Weiss
It wasn't insulting.
- [20:50]
Scott Wapner
Just move to the other chair.
- [20:51]
Steve Weiss
You asked me a question.
- [20:52]
Scott Wapner
When you talk about people's intelligence up here, the way that you debate people.
- [20:56]
Steve Weiss
I'm talking about, we're not going to do that.
- [20:58]
Scott Wapner
We're not going to do that. You said you were going to ask, you were going to have an answer more intelligent than the question.
- [21:03]
Steve Weiss
I have to get to the answer.
- [21:06]
Scott Wapner
Just slide down one chair. Or do you want the answer there or over there?
- [21:11]
Steve Weiss
Do you want the answer?
- [21:12]
Scott Wapner
So the other thing I want to talk about, Joe, is Buffett, because we also learned over the plays, perfectly into. This is the time to be cautious. Is it time to play a lot of offense? Well, they're sitting on a mountain of cash, right? $334.2 billion in Q4. That's a new record high. Quote. Despite what some commentators currently view as an extraordinary cash position at Berkshire, the great majority of your money remains in equities. That preference won't change. Quote. Often nothing looks compelling. Very infrequently, we find ourselves knee deep in opportunities. He's cautious, but he has been, I.
- [21:47]
Joe Terranova
Guess, you know, it's fine. We're going back and forth here, but let's talk about the substance of the conversation. Steve is mentioning he's cautious. I think Anastasia is saying it's, it's the time to really be selective. I'm saying that as well. I think you're citing that as well. We went through the period not saying.
- [22:02]
Scott Wapner
It'S time to do anything.
- [22:04]
Joe Terranova
We went through 23. We went through 23 and 24, Scott, where it was relative, it was kind of easy, right? You recovering from 2022, you had the acceleration in earnings, you had the new innovation surrounding generative AI, and it seemed relatively easy to step towards risk. You have to acknowledge where we are early in 2025, that it is more difficult. And I like the strategy that Berkshire is following. I like the fact that they're sitting on their hands and saying, yes, we have a tremendous amount of capital, but we are not going to deploy that right into the market because we don't think there's anything that is compelling in.
- [22:41]
Scott Wapner
The letter, in the annual letter. They didn't, they didn't give you the reasons why. People have been speculating, including us. It's like, well, he's sitting on a mountain of cash. Is he more bearish? Does he see something that we don't now they don't sit there and go through the reasons as to why they're sitting on this pile.
- [22:57]
Joe Terranova
That's.
- [22:58]
Scott Wapner
Well, I mean it could be one of the reasons, but you don't fully get that story. Jonathan Krinsky today is talking about there are enough warning signs to warrant a defensive posture.
- [23:07]
Anastasia Amoroso
Yeah, yeah. I mean it's one thing to be cautious, it's another thing to figure out what is it that you actually going to do about it. You know, I think there are reasons to be cautious because there are more incremental headwinds. And you know, look, if you're expecting 13% earnings growth for the S&P 500, some of it may be shaved off due to dollar strength, some of it may go away because of tariffs, you name it. But you know, do you get out of the market because you're cautious? No, I don't think the answer to that is that. I think you stay long, you stay in your favorite themes. But what you should be cautious about is when exactly you deploy capital. So we debated this whole thing today about, you know, did we have some sufficient sell off, do we have capitulation that we, you know, did we sufficiently reset? And the answer to that is on the S&P 500 on the NASDAQ, probably not. You know, if you look at the relative strength for the S and P, we're sort of middle of the range and the same for the Nasdaq. So what I think you can do, however, if you look at the dispersion of the S and P, it has been rising. You have more winners and losers. If you look at the correlations, they have been falling. So active managers, hedge funds are able to step in and buy those things on the pullback, but you don't do it all at once.
- [24:10]
Scott Wapner
Well, the markets had a really remarkable ability to a remain resilient and to be self correct. And each time that there's been some sort of period of excess over the course of this bull market, which is, what is it, two and a half years old? Yes, we've managed to deal with the reset and, and now we're witnessing a reset in momentum. It's not taking the whole market down. We just even in the face of it, last week we had new closing highs on the S and P. Why? Because of what Mike Wilson and J.P. morgan and others are still talking about even in the face of uncertainty.
- [24:47]
Joe Terranova
So the word, and I know Warren Buffett doesn't like this word, but the word is diversification.
- [24:52]
Anastasia Amoroso
Right.
- [24:53]
Joe Terranova
A lot of people don't like diversification. They say, oh, if you diversify, you take away the potential return outcome in the future. You need to concentrate to outperform the market. I get it. But this is to me kind of a moment where you do want to think about diversifying. Diversifying by sector, by asset class. Even geographically, you could find geographic opportunities. Obviously, Baba is a name that I purchased recently, had the exposure.
- [25:16]
Scott Wapner
Bob is getting hammered today.
- [25:18]
Joe Terranova
Bob is getting. So let me tell you how I'm managing Bob. I'm into Bob at 117. That was the entry price. I have a stop in at 100 1950. You should not lose money on it. The point of me saying you should not lose money on it is when you have a very significant winning trade like Baba was last Friday when it was up at 145, you don't turn a winning trade into a losing trade. I don't care what your opinion is of the valuation. The fundamentals never turn a winner into a loser. So 100 1950, I think that's how you have to risk manage it. But you can diversify here. I think this is the moment for that.
- [25:52]
Scott Wapner
All right, we'll take a break. We will come back. We do have our calls of the day. We do have some more moves to get through as well after this break.
- [26:04]
Bank of America Representative
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- [26:36]
Contessa Brewer
Quoting 30 year old movies? Have you said cool beans in the past 90 days? Do you think Discover isn't widely accepted? If this sounds like you, you're stuck in the past. Discover is accepted at 99% of places that take credit cards nationwide. And every time you make a purchase with your card, you automatically earn cash back. Welcome to the now it Pays Discover. Learn more@discover.com credit card based on the February 2024 Nelson Report. Check out the all new CNBC sport podcast where sports business and investing collide from media deals to team valuations, private equity moves and more. Catch the biggest business stories on the CNBC Sport podcast. Listen on your favorite plat.
- [27:33]
Scott Wapner
A number of calls of the Day. But first I do have some moves that we didn't get to go sidetracked. We're back. You trimmed matter.
- [27:40]
Steve Weiss
I did. I did. Why Met I've been saying it's my largest position irresponsibly large kept adding to when it was down. I should have trimmed back tell you truth during its 20 day run positive run when there's no reason for for it. So I did cut it back on Friday. It's still my largest position but given my cautious view in the market I thought there was a reason to take some off the table.
- [28:06]
Scott Wapner
You also, you recently bought back Dick's Sporting Goods.
- [28:10]
Steve Weiss
I did. You reduced it slightly. Just slightly. Based upon the retail numbers I still think Dick's will excel. The stocks come down about 10% or so though. It wasn't a big position but it wasn't a tiny position either. So I'm looking to add to it as it gets close to reporting earnings. But right now, again, cautious view in the market. Not a position I was married to that. I'm just trading around the portfolio.
- [28:35]
Scott Wapner
When I get Bitcoin, you you trim that too.
- [28:38]
Steve Weiss
I cut a little more of that Bitcoin. Another 10% of that position. Bitcoin is a risk asset. We saw it in the pre market when futures were up and now we're seeing it down. So it goes through these periods of consolidation. I think this could be one of those periods until we get specific laws regulations from from new head the SEC that should resume. But again just like within video everybody believes it's going to be a positive number as the last quarter's so we'll see what that does to the market with Bitcoin. It's no secret that the president has a bitcoin Bitcoin agenda. So what's new? The only thing could be news, actual action.
- [29:18]
Scott Wapner
All right. Calls of the day. Netflix today reiterated overweight Morgan Stanley. The stocks obviously had a huge run. They love the sports media expansion. They see the possibility of a broader WWE contract. They believe that it could become the home for F1. So they're giving you a list Joe, of all, all the reasons why they continue to love this stock.
- [29:43]
Joe Terranova
And I think all of these are known by everyone who owns the stock who has accumulated the stock over the last year. They saw the building momentum towards their engagement with live sports. The stock is in the midst of a little bit of a minor pullback. It looks like it wants to touch the 50 day moving average. Understand that's not something that's done in a very long time. And I would expect there to be a tremendous amount of sport support rather, given the understanding that this company has very strong fundamentals.
- [30:15]
Scott Wapner
Speaking of live events, live nation price target 175@B of A. The old one was 149. What do you think?
- [30:22]
Joe Terranova
I think they blew it out of the park beyond what I even expected when we discussed it last week. US inventory for 2025 tickets, 75% of that inventory sold out in one week. Here's how the analysts reacted to that. They raised the price target 12% from 1:6073 up to 166.17. I think that's warranted very strong momentum.
- [30:44]
Scott Wapner
All right. Contessa Brewer has the headlines for us today. Hi Contessa.
- [30:47]
Seema Modi
Hi there, Scott. The US Is siding with Russia to vote against a UN Resolution condemning Russia for starting the war in Ukraine. The US had authored a resolution calling for the swift end of the war with no mention of blame. But when the General assembly amended the resolution to add language condemning Moscow for its invasion of Ukraine, the US abstained from voting. The US is imposing new sanctions on 22 people and 13 vessels for their part in selling and transporting Iranian crude oil as part of Iran's shadow fleet. The Treasury Department said the entities being sanctioned are located in the United Arab Emirates, Emirates, Hong Kong, India and China, as well as Iran, and added that the sanctioned ships move crude oil valued in the hundreds of millions of dollars. New York City Mayor Eric Adams will close the migrant center located in the Roosevelt Hotel, which was a frequent target of criticism for both Elon Musk and the Trump White House. In a statement today, Mayor Adams pointed to a decrease in migrant registrations for the reason behind the move. Adams has promised to close 53 other emergency shelters in the city by June. That's the news, Scott. I'll send it back to you.
- [31:58]
Scott Wapner
Contestant, thanks so much for that, Contessa Brewer. Up next, a sign of the times in the ETF world as retail investors take on some new risk. Bob Pizzani is standing by with some new numbers you need to see. It's in today's ETF Edge next.
- [32:13]
Contessa Brewer
Are you still quoting 30 year old movies? Have you said cool beans in the past 90 days? Do you think Discover isn't widely accepted? If this sounds like you, you're stuck in the past. Discover is accepted at 99 of places that take credit cards nationwide. And every time you make a purchase with your card, you automatically earn cash back. Welcome to the now it pays to Discover. Learn more@discover.com credit card based on the February 2024 Nelson Report. Check out the all new CNBC Sport podcast where sports business and investing collide from media deals to team valuations, private equity moves and more. Catch the biggest business stories on the CNBC Sport podcast. Listen on your favorite platform.
- [32:57]
Scott Wapner
Papazzani has today's ETF edge.
- [32:59]
Bob Pisani
Bob, good to see you. It is a sign of the times as risk appetite has grown. Assets under management of leveraged and inverse ETFs has grown dramatically. It was about 2% of ETF assets in 2016. It's almost 8% today. More importantly, the trading volume has exploded. On any given day, dollar volume and leverage an ET inverse ETFs are among the largest daily dollar volume leaders in the ETF space. So what is behind all of this? Who's doing all of this trading? Let's talk with Douglas Jonas. He's the CEO of direction. You're one of the big guys in this space. You're one of the largest providers of the products. Every day I look at the volume charts, I see your semiconductor bull ETF right at the top of the volume charts. It gets three times the return of the semiconductor index on a daily basis along with your 3, 3 times s and P products. Who is doing all this trading in these products?
- [33:48]
Douglas Jonas
Yeah, Bob, I mean it's no surprise to us when, when there's individual investors and we'll talk a little bit about retail institutional investors, folks who are moving money and need to do so quickly and with levers. They're leaning towards the direction lineup of ETFs. And you know, we talked a little bit about this, right? It's hard to know exactly, but we think about three quarters of that movement is coming from retail, maybe a quarter coming from institutions. And there's growing use cases. You know, historically it was really about people making short term directional bets on the market. Those use cases are expanding. We're seeing institutions looking to hedge. We're seeing individuals looking to offset some of their, some of their positions and avoid maybe selling due to capital gains.
- [34:29]
Bob Pisani
Some of this is overseas investors. You were telling me South Koreans, Japanese, small, small retail investors doing this.
- [34:36]
Douglas Jonas
Yeah, that's right. I mean there's a lot of individual investors as well as institutions worldwide who have very large positions in a lot of fast moving stocks and they want to take advantage of momentum plays. They also want to use the ability to, to, to hedge their positions.
- [34:50]
Bob Pisani
It's not just a leverage and inverse index ETF. Single stock leverage ETFs are growing fast. You've got this Tesla bull ETF that shows up all the times, two times the daily leverage of Tesla. There's a two times long in video one as well from the competition. So when you talk about institutional investors, who are you referring to specifically? Is it hedge funds, trading desk, brokerage firms?
- [35:12]
Douglas Jonas
Yes, yes and yes. I mean, the reality is, Bob, I mean, we know this, the market moving headlines are happening faster. They're happening on a daily basis. It's not years ago where companies would move just basically based on earnings or some major report. We're seeing a daily basis, whether it be be issuance out of the White House. We might be seeing tariff reports. It might be seeing suggested earnings in videos coming up Wednesday. People want to be able to make positions.
- [35:37]
Bob Pisani
They want to do a short term on that. Retail investors in the past have had a very hard time with these products, a hard time getting around the products because of this daily reset. They reset every day. So if you hold them for more than a day, your returns could vary wildly due to compounding what percentage of investors hold these for more than a day. How would you grade the business, the ETF business, on educating people about.
- [35:59]
Scott Wapner
Absolutely.
- [36:00]
Bob Pisani
Because you can get wildly different returns.
- [36:02]
Douglas Jonas
This is the most important thing any investor should be looking at. The most important thing they should be checking their ETF positions. Anytime you're using leverage whatsoever, you need to be looking at that daily. That's something that we're very focused on. They can go to our website at Direction ETFs. Education comes first. People need to understand what leverage impact that, what that impact can be in your portfolio, how you need to check it. But you're right, it's really a daily basis that people need to be checking these positions.
- [36:28]
Bob Pisani
We're going to have a lot more coming up on how to use leverage and inverse ETFs. That's coming up on ETF Edge at 1:10pm Eastern Time. Doug will be joined by Todd Rosenblut. He's the head of research@verify.com A lot to discuss around this. And Scott, the volumes have just been exploding in the last five or six months. Back to you.
- [36:46]
Scott Wapner
All right, Bob, thank you very much for that. As Bobzani, we do have more committee stocks on the move. Weiss has another move to tell you about and I told you, Alex Karp, the Palantir CEO, speaking at the New York Economic Club at this very moment, will tell you what he just said after this quick break. We're watching shares of Palantir closely today as we have been for the last couple of weeks. The CEO Alex Karp is speaking as we speak at the Economic Club of New York. Seema Modi has been monitoring that and joins us now with the highlights.
- [37:34]
Anastasia Amoroso
Seema and Scott, shares of Palantir office the lows of the day after. CEO Alex Karp at the Economic Club of New York is basically defending the US Government's efforts to review and cut costs on its budget, saying ultimately what is good for this country is good for Palantir.
- [37:52]
Steve Weiss
Listen in the single best thing that.
- [37:57]
Contessa Brewer
Helps my company is meritocracy.
- [38:00]
Steve Weiss
Pen test everything.
- [38:02]
Contessa Brewer
Yeah, I don't know.
- [38:03]
Steve Weiss
We have hundreds of client contracts. Maybe, I don't know, maybe there's a contract that doesn't deserve to be renewed.
- [38:08]
Bob Pisani
Great.
- [38:08]
Contessa Brewer
Maybe there's a contract that does deserve.
- [38:10]
Steve Weiss
To be renewed that gets canceled. Pen test everything. Test the unit economics.
- [38:14]
Contessa Brewer
Test the unit economics.
- [38:16]
Steve Weiss
And unit economics in this case also include general good like the PG product stops terror attacks and augments civil liberties. So it's like there's a double good.
- [38:32]
Anastasia Amoroso
Those comments again from Karp defending what the US Government is doing on looking at different programs to cut its budget and says ultimately that Palantir wants what is best for this country. It comes following that report last week that the Department of Defense is looking to cut its budget by 8% this year. Scott, you'll see shares down 7.8%. We started the day down as much as 10%.
- [38:53]
Scott Wapner
Yeah. We'll watch them closely. Seema, thanks so much. Sima Modi with the update for us there. Santoli is next with his midday word. Our senior markets commentator Mike's and Toll is here at the desk for his midday word. I mean, at some point the momentum unwind is going to be done. It doesn't feel like it's fully flushed yet.
- [39:31]
J
No.
- [39:32]
Scott Wapner
In some respects, although a lot of these names are off their lowest levels of the morning.
- [39:35]
Steve Weiss
They are.
- [39:36]
J
You never quite know. I mean, look, if it's I saw JP Morgan this morning talking about how largely it looks done and then the charts were basically right in the middle of the range. So in other words, it's no longer extreme in terms of crowding and in terms of how extended they are. But you never know when you're done until you maybe get a full purge. I don't know if that's the whole story. I mean, obviously underneath the surface, alongside that was what's becoming evident, which is a mini soft patch growth scare getting priced in. Don't think anybody's panicky about that. It's funny, the last two years at least we've had stronger than expected January, February and everyone was a little bit wrong footed when you had so maybe it's weather, maybe it's just hangover from a strong fourth quarter consumer. It's looking a little tougher. But then you get, you know, the two year back back below 4.2. You're pricing in some more cuts. So the market has a way of playing defense for a while and trying to heal itself that way.
- [40:30]
Scott Wapner
Unless you know, does Nvidia give you the catalyst to play some offense again and then does PC give you all the reasons to back that up?
- [40:38]
J
Right. So that's that lurks out there. I doubt you you want to get super negative on semis after what they've done into in video. I have to imagine that we're never going to get back to the leash being as long on the infrastructure theme as it was last year. That doesn't mean it's over. It just means everyone kind of assumes there's going to be an overbuild at some point. We just don't know where it is.
- [40:59]
Scott Wapner
All right, I'll see you on closing bell a couple of hours from now. That's Mike Santoli. Up straight ahead. CNBC Pro did a screener on the movie most overbought and oversold stocks in this market. We're going to reveal some of the names next. Still have a move to get to that we didn't have a chance to do yet. So we'll do it now. You trimmed Uber, which has been a pretty hot debate within this market over the last month.
- [41:46]
Steve Weiss
Yeah. And there's no mystery here. The reason I did it is that I have a really good gain in a very short time on it. I also think there's some hype in the stock from a recent tweet by a, by a well known hedge fund manager. I still like it. I still think it's going to do well. I just thought it's prudent to cut it back to the position size when I entered it.
- [42:07]
Scott Wapner
I mean it's not lost on me at all. Right. Trimmed. No buys today. You trimmed Vertiv Meta Uber Bitcoin Exporting goods. Yeah, just trying to go across the portfolio and look, you know, lighten up where you can.
- [42:21]
Steve Weiss
Candidly, you know, there's no excuse for this at all. But you know, last week really caused me to pay attention and not be so complacent with the portfolio. I was aware I had what I had to do. But look, you tend to get when things are going up and everything going your Way you tend to let things ride for a little longer than they should. And I did that with Metta. But again Metta is still perhaps my largest position. I just got to check, you know, see where everything is and the others it was right sizing the position, you know, that's just what is portfolio management.
- [43:03]
Scott Wapner
I mentioned in a cautious out. I got you. I mentioned CNBC Pro did a screen on the most overbought and oversold stocks within the market. On the most oversold list. Interesting to us is deco those all on that list. On the most oversold they have an RSI below 30 which suggests oversold 25.5 is deckers.
- [43:25]
Joe Terranova
So let's take that one first because this is a classic example of how you cannot assign automatically a high valuation to a momentum name. Deckers trades at a reasonable valuation in the mid 20s. Deckers made a 52 week high on January 30th. It is now approaching a 52 week low. It has had a dramatic reversal. It was overwhelmingly owned by all of the momentum non discretionary funds. They're all discarding it right now as it breaks below all of the moving averages.
- [43:56]
Scott Wapner
Most recently, the 200 day Weiss UnitedHealth Group is on the list. 27.8 is the RSI again below 30 suggesting oversold.
- [44:05]
Steve Weiss
I believe it's oversold. I also think that this is going to take a long time. This being the case that was brought against him on Friday. Take a long term to play out and frankly as we've seen with some of the crypto cases that were brought, you know, it's not unlikely for this to be resolved without any action taken.
- [44:28]
Scott Wapner
Welltower is on the most overbought list. At the tops of it in fact 76.5. An RSI above 70 suggesting overbought. Is this overbought?
- [44:38]
Joe Terranova
Yes it is. Health care, we own it had very nice price appreciation but it is in overbought territory.
- [44:43]
Scott Wapner
How you look at this, I think.
- [44:45]
Anastasia Amoroso
It'S a really good exercise to do right now because when you look at The S&P 500 it's not overbought, it's not oversold. But there's so many stocks underneath the surface. What I will say is that you can just look at RSI and make a trade on based on that you have to look at technicals, which is the rsi. You have to look at positioning and most importantly you have to look at the catalyst. Is there something to unlock that value? So if you have all three then I think those stocks are a buy.
- [45:08]
Scott Wapner
Alright, check out the Full list by the way of overbought and oversold names@cnbc.com pro. We're back with the setup and final trades. So a quick setup. Joe Diamondback that reports today after the.
- [45:29]
Joe Terranova
Bell working off some difficult comps. Revenue growth should be strong. CEO transition is in place and they just acquired about 4 billion of very valuable Permian assets.
- [45:39]
Scott Wapner
Okay. Of course before that we do have the closing bell at 3:00 Eastern and I hope you'll join me with Lauren Goodwin, Matthew Boss, Doug Clinton and Alicia Levine. 3:00 Eastern Time for closing bell. Weiss, what is your final trade?
- [45:51]
Steve Weiss
K. Webb, Look, I think that what what hit the stocks they've was Trump's new order. It's got nothing to do with these companies operate internally in China? I don't believe so. It's good.
- [46:02]
Scott Wapner
Well, these stocks have been on the run of late, that's for sure. Anastasia, great having you.
- [46:05]
Anastasia Amoroso
Good to see you. Data centers there's been some nervousness about the capex numbers but vacancies are super low at 2.8%. So I'm a buyer on the dip.
- [46:13]
Scott Wapner
Okay.
- [46:13]
Joe Terranova
And Jyoti, the low hanging fruit continues to be the insurance companies. We all know the reason why as we pay those premiums progressively of Corp one name you could own two and.
- [46:23]
Scott Wapner
A half percent up. All right, decent move here in the market. We'll see what the last hour brings. I'll see you then. The exchanges now you've been listening to CNBC's Halftime Report, the podcast you can always catch us live weekdays at 12 Eastern only on CNBC.
- [46:41]
Bank of America Representative
All opinions expressed by the Halftime Report participants are solely their opinions and do not reflect the opinions of CNBC, NBCUniversal, their parent company or affiliates and may have been previously disseminated by them on television, radio, Internet or another medium. You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Halftime Report participants consider reliable. But neither CNBC nor its affiliates and or subsidiaries 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.
- [47:20]
Contessa Brewer
Check out the all new CNBC Sport podcast where sports business and investing collide from media deals to team valuations, private equity moves and more. Catch the biggest business stories on the CNBC Sport Podcast. Listen on your favorite platform.