Halftime Report: Trading Trump’s Tariffs (March 4, 2025)

Host: Scott Wapner
Guests: Josh Brown, Stephanie Link, Carrie Firestone, Brian Belsky
Release Date: March 4, 2025
Air Time: Weekdays, 12-1 PM ET on CNBC TV

1. Market Overview

In this episode of Halftime Report, host Scott Wapner delves into the tumultuous state of the stock market amid escalating trade tensions and the imposition of new tariffs by the Trump administration. Joined by esteemed guests Josh Brown, Stephanie Link, Carrie Firestone, and Brian Belsky, the panel provides a comprehensive analysis of market movements and investment opportunities.

Key Points:

• NASDAQ Correction: The NASDAQ has entered a correction phase, declining over 10% from its recent highs.
• Russell Index Down 17%: Small-cap stocks are particularly affected, serving as the initial targets in the ongoing trade war.
• Global Tariff Retaliations: China and Mexico have responded to U.S. tariffs, with Canada imposing an export tax on U.S. electricity.

Notable Quote:

Scott Wapner [01:00]: "The NASDAQ is officially in correction. That means it's down more than 10% from its high."

2. Impact of Trump’s Tariffs and Trade War

The discussion centers on the ramifications of the Trump administration's tariff policies on the U.S. economy and global trade dynamics.

Key Points:

• GDP Projections: Stephanie Link from JP Morgan highlights a tactical bearish outlook, projecting a potential crush in U.S. GDP.
• Economic Indicators: Despite the bearish outlook, Scott counters with positive signs such as declining gasoline prices, lower interest rates, and a steady job market.

Notable Quotes:

Stephanie Link [04:00]: "We've had three and a half trillion dollars of value wiped out of the S&P since election day."

Scott Wapner [02:21]: "Gasoline prices are down 10% year over year. You have much lower interest rates."

3. Consumer Sector Resilience

The panel examines the strength of the consumer sector amidst economic uncertainties.

Key Points:

• Job Market Stability: Wages are up by 5%, and savings rates have increased, providing a buffer for consumer spending.
• Retail Performance: Companies like Walmart and Target have reported robust same-store sales, defying expectations of a faltering consumer base.

Notable Quote:

Scott Wapner [13:15]: "The consumer is not dead. They have jobs, wages, and savings, which are the most important factors."

4. Sector-Specific Investment Opportunities

The guests identify sectors that present potential investment opportunities despite the market downturn.

Key Points:

• Financials and Energy: Scott suggests that financial and energy sectors offer promising opportunities due to their resilience and potential benefits from tariffs.
• Manufacturing Renaissance: An anticipated revival in the manufacturing industry could be advantageous for investors.

Notable Quote:

Scott Wapner [03:10]: "I think there are opportunities in financials, in energy, especially in industrials because I'm not backing away from manufacturing."

5. Health Care: The Best Performing Sector

Health care emerges as the top-performing sector, with significant gains despite broader market challenges.

Key Points:

• Stock Highlights: Stocks like AbbVie, Bristol Myers, and Gilead have shown strong performance.
• Technical Analysis: Stephanie Link emphasizes the technical strengths of certain health care stocks, making them attractive investments.

Notable Quote:

Stephanie Link [37:30]: "Healthcare has the most amount of names on my list of best stocks in the market."

6. Mergers & Acquisitions (M&A) Dynamics

The episode explores the state of M&A activities amid heightened trade tensions and economic uncertainties.

Key Points:

• Deal Slowdown: Cross-border tensions have led to a slowdown in M&A activities, causing delays rather than halts.
• Private Equity Impact: Firms like Blackstone and Carlyle face challenges due to reduced deal flows and increased market volatility.

Notable Quote:

Stephanie Link [26:00]: "Cross-border tensions slow everything down, giving people pause about transactions."

7. Spotlight on Specific Stocks

The panel discusses notable movements and investment strategies related to specific stocks, highlighting both challenges and opportunities.

Apple Inc. (AAPL)

Key Points:

• Stock Performance: Despite trade war vulnerabilities, Apple remains resilient, partially due to its robust cash flow and quality metrics.
• Tariff Impact: Concerns persist about iPhone pricing and supply chain dependencies on China.

Notable Quote:

Brian Belsky [20:10]: "Apple checks a lot of boxes with regard to quality and liquidity, which is why we're going to continue to overweight it in our tech."

Target Corporation (TGT)

Key Points:

• Operational Metrics: Target has shown improvement in operating margins and same-store sales, making it a strong candidate despite market volatility.
• Valuation: Priced at 12 times forward estimates with a 4% dividend yield, Target is viewed as a valuable investment.

Notable Quote:

Scott Wapner [33:12]: "Operating margins are the most important in my mind along with traffic and comps."

Broadcom Inc. (AVGO)

Key Points:

• Valuation and Growth: Broadcom's valuation has become more attractive, with plans for significant market expansion through acquisitions like VMware.
• Investment Strategy: Scott highlights Broadcom as a long-term holder despite short-term volatility.

Notable Quote:

Scott Wapner [21:44]: "I like the valuation, the pullback in the stock and I just thought it was an opportunity."

8. Travel and Consumer Discretionary Stocks Under Pressure

The travel sector faces downward pressure due to economic soft patches affecting demand.

Key Points:

• Airlines and Casinos: Stocks like JetBlue, United, Delta, Caesars, and MGM Resorts have seen significant declines.
• Strategic Holds: Despite the downturn, some panelists like Scott are adding to positions in select travel stocks, anticipating a recovery.

Notable Quote:

Brian Belsky [45:10]: "If you think about interest rates going down and fuel costs going down, Delta has its own refiner, so I think this is a pure overreaction."

9. Closing Remarks and Future Outlook

As the episode wraps up, the panel underscores the importance of strategic investment amidst ongoing market volatility and trade tensions.

Key Points:

• Strategic Asset Allocation: Emphasis on holding quality stocks and sectors that demonstrate resilience.
• Market Vigilance: Continued monitoring of headline-driven events and their impact on market movements.

Notable Quote:

Scott Wapner [49:08]: "All opinions expressed by the Halftime Report participants are solely their opinions and do not reflect the opinions of CNBC."

Conclusion

The March 4, 2025 episode of Halftime Report offers a deep dive into the complexities of trading amid President Trump's tariff policies. With expert insights from industry leaders, the podcast navigates through market corrections, sector-specific opportunities, and strategic investment approaches. Despite the uncertainties, the resilience of the consumer sector and the standout performance of health care stocks provide a balanced perspective for investors aiming to navigate the turbulent financial landscape.