Trump Tariffs Hit the Economy 04/30/25

Summary

CNBC’s Halftime Report: Trump Tariffs Hit the Economy (April 30, 2025)

Hosted by Scott Wapner

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1. Introduction and Economic Overview

In the April 30, 2025 episode of CNBC’s Halftime Report, host Scott Wapner delves into the pressing issue of how President Trump’s tariffs are impacting the U.S. economy. Joined by a panel of esteemed analysts—Joe Terranova, Carrie Firestone, Steve Weiss, and Jim Leventhal—the discussion centers around the recent economic indicators pointing towards potential stagflation and the subsequent reactions in the stock market.

2. Market Analysis and GDP Report

Scott opens the discussion by highlighting alarming economic data:

• GDP: The first negative read since 2022 ([00:59]).
• Personal Consumption Expenditures (PCE): Higher than expected.
• ADP Employment Numbers: The lowest since July ([01:45]).
• Chicago PMI: The weakest since January.

These indicators collectively paint a picture of a fragile economy grappling with stagnation amidst inflationary pressures.

Carrie Firestone emphasizes the complexity of the current environment: “The word of the day once again appears to be stagflation” ([01:45]). She further underscores the resilience of certain sectors despite the softening economy, noting that some companies have provided better-than-expected guidance.

3. Trade War and Tariffs Impact

The panel acknowledges that the ongoing trade war initiated by tariffs is a significant drag on economic growth. Joe Terranova argues that the main concern lies with economic growth rather than inflation, viewing the latter as a temporary sticker shock. He states, “There is elasticity between that sticker shock and what consumers are ultimately going to do” ([02:08]).

Steve Weiss and Jim Leventhal discuss the delicate balance the market is attempting to maintain, with Weiss pointing out that the S&P has been on a six-day upward streak despite looming trade deal uncertainties ([04:07]).

4. Panelists' Perspectives on Investment Strategies

Joe Terranova recommends focusing on companies with strong balance sheets capable of repurchasing stocks and maintaining qualitative stability in such an environment. He suggests prioritizing the bond market, viewing it as a near-term opportunity amid economic uncertainties ([02:08]).

Jim Leventhal counters by advising capital protection, asserting that “times do get different” and emphasizing the importance of safeguarding investments against potential market downturns ([07:51]).

Rick Reeder of BlackRock provides a nuanced view, explaining that while the market isn’t as overvalued as it once was, the potential for a deeper recession remains a concern, though he maintains a cautiously optimistic stance.

5. Earnings Reports and Stock Analysis

The discussion shifts to specific stocks and earnings reports, with a focus on major players like Meta (formerly Facebook) and Microsoft.

Julia Boorstin from CNBC highlights Meta’s current challenges:

• Stock Performance: Up 26% in the past year but down 27% from its all-time high.
• Revenue Growth: Expected to slow to 13.5%, down from 21% in the previous quarter.
• Ad Revenue Concerns: Potential $7 billion loss from the Chinese market alone ([16:28]).

The panel debates Meta’s future prospects, especially its investments in AI and the new standalone Meta app. Steve Weiss notes, “For many years it had that mid-30s multiple because it was intellectual property. Now with these data centers, it's becoming a little bit more asset-heavy” ([23:18]).

Microsoft is another focal point, with Jim Leventhal expressing concerns over its recent performance despite its reputation as a "permanent compounder." He mentions, “They have great management teams. They're not always going to be perfect and be able to navigate through the dark winds and the dark times that we see” ([21:22]).

6. Regulatory Concerns and Company Outlooks

Regulatory issues also come under scrutiny, particularly Meta’s ongoing FTC trial. Julia Boorstin explains that investors are keenly watching how geopolitical uncertainties and tariffs affect Meta’s advertising revenue and AI investments ([17:49]).

Joe Terranova adds that the market has likely priced in the expectation of trade deals, suggesting that any actual agreements may be short-lived and not significantly alter the current economic trajectory ([12:14]).

7. Closing Remarks and Upcoming Events

As the episode nears its end, Scott Wapner highlights upcoming earnings reports and significant events, including the Berkshire Hathaway annual shareholder meeting. Mike Santoli provides midday market commentary, reinforcing the uncertainty surrounding the Fed’s policies and the broader economic outlook ([39:21]).

Steve Weiss concludes with thoughts on energy stocks like ExxonMobil, emphasizing its resilience due to scale and dividend yield despite low oil prices ([36:53]).

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Notable Quotes:

• Scott Wapner ([02:05]): “Tariff turmoil sending GDP into the red. Stocks selling off a bit as the President's trade war now leading to big questions about where this economy is heading.”

• Joe Terranova ([02:08]): “You want to look at your equity holdings and ensure that you own companies that have strong balance sheets that can buy back their stocks.”

• Jim Leventhal ([07:51]): “It's time to protect capital... My base case is that the market goes lower.”

• Rick Reeder ([06:45]): “Apollo is one of the premier private equity companies with a focus on fixed income. It was down 30%. It's a stock we've been watching for the last couple of years.”

• Julia Boorstin ([16:28]): “Investors are watching the broader ad market, whether Meta is seeing signs of weakness amid so much uncertainty.”

• Joe Terranova ([12:14]): “I think the market actually is priced in the fact we're going to get deals so it's going to be short-lived.”

Conclusion

The April 30 episode of Halftime Report provides a comprehensive analysis of the current economic strain caused by Trump-era tariffs, highlighting concerns of stagflation and a fragile stock market. The panelists offer diverse perspectives on navigating this tumultuous environment, emphasizing the importance of strategic investment choices and cautious optimism amidst ongoing trade uncertainties. As the economy continues to evolve, the insights shared offer valuable guidance for investors seeking to mitigate risks while identifying potential opportunities.

Transcript

[Fidelity]

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[Scott Wapner]

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[Joe Terranova]

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[Joe Terranova]

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[Carrie Firestone]

Retail fidelity account sell order assessment fee.

[Joe Terranova]

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[Fidelity]

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[Carrie Firestone]

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 very much. Welcome to the Halftime Report. I'm Scott Wapner. Front and center this hour. Tariff turmoil sending GDP into the red. Stocks selling off a bit as the President's trade war now leading to big questions about where this economy is heading. We debate it with the investment committee as always. Joining me for the hour today, Joe Terranova, Carrie Firestone, Steve Weiss, Jim Leventhal. We will check the markets. We're red across the board. We are off the worst levels. But Joe, we are looking at the first negative read on GDP since 22. PCE was higher. ADP was the lowest since July. Chicago PMI was the weakest since January. And the word of the day once again appears to be stagflation. That's what we're worried about. That's part of the backdrop. The other part of the backdrop is S and P has been up for six straight days and you still have teases of trade deals.

[Joe Terranova]

Very delicate environment.

[Carrie Firestone]

So what do you want to do in that delicate environment?

[Joe Terranova]

Well, what you want to do in that delicate environment is you want to look at your equity holdings and you want to ensure that you own companies that have strong balance sheet that can buy back their stocks, that are qualitative in their nature. I still think you want to focus first and foremost on the bond market. The problem as I see it with the Economy is growth is the concern. I'm less concerned about inflation because I see it as a one time price sticker shock. I think there is elasticity between that sticker shock and what consumers ultimately going to do. I think a lot of people were looking at the report today and saying well personal consumption was up 1.8%. That's a good thing. Well what about the fact that they probably that consumer spending were trying to get ahead of the tariffs just like we saw the surge in the imports. So the overall environment is one in which I still think it's delicate at best and it warrants really looking at the fixed income market because I think that's your opportunity in the near term.

[Carrie Firestone]

You know care we have talk of potential deals people we all know that the economy soft and it's softening but you also have the prospect of deals and it's still been a pretty resilient economy in the face of everything and the consumers remain resilient in the face of all that. Even some companies have to. We've probably gotten more guidance than we expected to this point. I think we expected fog leads to no guidance and we've actually been surprised a bit to the upside. So then it comes back to where the stock market's currently trading. We've retraced 50% from high to low post liberation day. The question is are stocks attractive now? And the backdrop that I painted for you. I asked rick Reeder of BlackRock that for a question. He said stocks are still too expensive. Listen.

[Steve Weiss]

The fair value of the equity market strikes me today.

[Jim Leventhal]

It's still below today's levels.

[Steve Weiss]

I would argue 5 to 10% below today's levels. Once you get through the uncertainty then I think you've got upside. But I don't know.

[Joe Terranova]

I think multiple today is a bit high and I think the earnings growth.

[Steve Weiss]

That we're seeing today that's priced into the market is a bit. Is a bit elevated.

[Carrie Firestone]

Short term tricky, longer term positive. That's, that's distilling Reader down from what he told me.

[Rick Reeder]

Well I heard that interview yesterday and I feel that to some extent Rick is absolutely correct that there is potentially more downside. But when the market was down 20% at the low at its lowest point, what you had in there we felt was about half of that related to equity markets being somewhat overvalued. We ended the year at high multiples. The max sevens really were up to 34 and a half percent of the S and P. You really saw a market that was priced I would say to Perfection. So we lost that premium. But we also then had a discount for tariffs. Recession earnings coming down when we were at the lows at the beginning of April. So now we've retraced half of that. So now we're back to where we were, meaning we're at a point where the market is not as expensive as it was, but there's nothing in it for a deeper recession or a deeper sort of unwinding of earnings potential. He said too much.

[Carrie Firestone]

He said we probably get a recession. I mean, I think is we're basically in a recession, but it could be pretty short and pretty shallow. So if I told you that was going to be the case, would you say, oh, well, okay, maybe stocks are a little bit overvalued still, but I'm not going to time this thing anyway.

[Rick Reeder]

That's right. I mean, that is our feeling. It's exactly there. When the market was way down, we were buying. I think I was one of the only people on the desk buying. And we've made some more purchases. I won't mention them now. Okay, we'll get into this point where in that range where the. Some of the market is very attractive and some of it has come back less attractive, but it's not very overvalued in our opinion.

[Carrie Firestone]

Let's do one of your moves now, because I think it's apropos to what's been in this. In the. In the zeitgeist of where is all the positivity that people came into this year and this administration thinking about it's going to be in the banks and private equity and all these places because deregulation and tax cuts, which we still expect to get, by the way. Maybe they were just pushed and it hasn't manifested itself in the stock prices. Apollo, perfect example. Right. Private equity stocks, I don't think have performed to anybody's expectations from the beginning of the year until now. But you bought it. Why?

[Rick Reeder]

Yeah, we bought Apollo, but we already own Blackstone. And Apollo is one of the premier private equity companies with a focus on fixed income. It has an insurance business, a hybrid model. Insurance plus private deals. It has sourcing, one of the best in the world. It has great management and it was down 30%. It's a stock we've been watching for the last couple of years and we thought at this price, this was the time to make our entrance. You know, maybe there's a little more downside, but we really felt it was attractive here on a multiple basis and free cash flow, etc. And deals will come. It isn't as if we expected, oh my God, a switch is going to go off and all of a sudden there's going to be rampant deals everywhere. We just thought that market has been weak for two years and this is a time on the private equity side to start to pick up the pace. And the private credit market as we know has been very strong and they're, you know, they're very strong there. And also their credit, their credit is not weak credit. They have strong credit.

[Carrie Firestone]

All right, Weiss, you take everything into consideration, all the comments into context and you come out with what today I.

[Jim Leventhal]

Come out with it's time to protect capital. Look, these perspective is important and Joe spends a lot of time looking at all the inputs, macro inputs. He mentions image credit market. I know he looks at currencies, everything. But most people here, right? Every people, everybody sitting here is not the asset allocator. Nothing wrong with that. They are investing equity. So they're always going to look to put equity in the market. Nobody's giving to them and saying put it in bonds, put it in currencies. So that's let's, let's. That's an important bias to note. Here's what I'd say. This time is not like other times. Times do get different and in terms of resilient consumer. Consumers are always resilient. But what's the time period? The consumer right now is not resilient. The consumer right now is scared and stockpiling goods because they see major prices price increase coming. So this is what the beginning of stagflation looks like. We've got CEOs that are saying of so many companies, I've never seen so many companies do this where they say we don't have visibility. So how arrogant is it to say I've got visibility as an investor without all their tools, without all their balance sheet looks, without the credit market, we never have visibility. Well, your visibility cues off with the company's disability is otherwise why do you need a active manager, right? Define indices. If you don't have any visibility, you do your work, you have it. So what I'd say is the following. I'd say that you protect capital. You can't time marks, that's for sure. But which can look at is you can look at where the risk is and you have to have a base case. My base case is that the market goes lower. I think Rick Reeder, who I agree directionally, but I think he's, I think he's underestimating the potential to climb because there's no reason in the world why this environment should have a P e. A forward PE substantially higher than what we've seen over the last 25.

[Carrie Firestone]

No, but that's why he suggested that in the near term you could go 5 to 10% lower from here and.

[Jim Leventhal]

My target would be lower depending. Now in the interim, that's my intermediate target because I'm convinced we're going to recession. Near term, I don't have the short position I had before. I haven't really been adding. I mentioned a couple of things the other day. But near term, you get a deal with India, you'll see the market pop. You get some other shoes social headline. You'll see the market pop until the market gets exhausted by that and starts seeing real data. Then you'll get those pops and you get the sell off.

[Carrie Firestone]

Krinski. Krinski today. Risk reward favors downside. Goldman expecting renewed declines in equities. Wolf, stay defensive and sell rips. So, I mean, there's a lot of people in, in the Weiss camp, sure, at this point and maybe for good reason, but you tell me there are certainly more potential negatives than positives that are in front of your face currently. The challenge is having the wherewithal to try and look through the fog and see what might be on the other side.

[Steve Weiss]

It's very foggy. There's always fog. Kerry, I agree with you. There's always fog.

[Carrie Firestone]

This is dense.

[Steve Weiss]

I said it's very foggy. You say it's dense. I agree. My point on this is it does come down to one thing in my opinion, and that's trade deals. And regardless of whether they're superficial or not, that's what the market's keying into. Steve, I think you just said that, you know, if a deal with India were announced, it would pop the market because the market is willing. And it's showing in this. Hang on one second. It's showing in this 10 percentage point rise off of the lows. It's showing a willingness to look through a recession that becomes more and more probable with each given day. As long as that recession is short and sweet and the only way a recession is going to be short and sweet is if there are trade deals and if those reciprocal tariffs which are currently on pause are frankly permanently done away with the universal tariff of 10%, the world can get around it. The reciprocal tariffs are simply too much for the global economy, the US economy s and P500 profits and the stock market to take. So that's. It comes down to a binary situation with those reciprocal tariffs. As far as where we go in the short term, Scott, I don't know. It really depends on these trade deals and whether they are announced. As for whether they're substantive or not, at best they're going to be memorandums of understanding. At best it's going to take years to actually by the way, then be.

[Joe Terranova]

Careful with the trade deals. I think the market actually is priced in the fact we're going agreed. That's why we're priced at it. We know we're going to get deals so it's going to be short lived.

[Carrie Firestone]

You cite your S and P futures decision morning.

[Joe Terranova]

Yeah, I got stopped out of those. I made money on them. So let's be clear at a nice. I rode the market higher and playing for a bounce. Playing for about nothing else than that. Just playing being tactical. But and Steve's right, most of the people that are watching the show, most people are looking in the universe in terms of allocating to equities. But I look in the other areas of the market to kind of tell me what the personality is. And you can't ignore what you're seeing right now as it relates to the economy. If we could, can we throw up a three year chart of the two year look at where the two year is today at 3.63. Right now you're basically going back and challenging where we were on April 7th at 3.43. And if you in fact take out that level, you're talking about a two year that potentially is sub 3%. That is not indicative of an environment that is a good one as it relates to growth. That is clearly an environment that telling you is growth is a concern. You have oil at $58, you have copper on the retreat over the last week. The biggest concern that we have in front of us is what has happened to the economy. And I say what has happened Scott, because I think the effect of all of this is already happened. I don't think it's, I don't think it's avoidable in the future.

[Carrie Firestone]

I told you that part of the year and part of the move in the two year is, you know, trying to game out the Fed. You know the gunlock perspective.

[Jim Leventhal]

Right.

[Carrie Firestone]

The Fed follows the two year. That's what he's always said.

[Joe Terranova]

Can I respond? I'm going to tell you I think next week when the Fed meets, I think they end cute and I know that's probably something that's not consensus but I think that's going to be the first strike from the Federal Reserve and actually easier monetary policy. I think they end qt, you know.

[Jim Leventhal]

So gun like pretty smart dude. We've had him on the show. He's, he's really wired. Great thinker but I'm going to disagree. I think that they're trying to get maybe in front of an easing and I don't see the easing cycle happening now. The Fed's come out and said look, if it's transitory, meaning that we get one big hike and then we can see our way to cutting. Possibly. But it's not going to be this.

[Carrie Firestone]

But if you get on Friday, if you get an ugly jobs number or even a negative job number, you don't think that the probabilities that Leaseman is going to come on and tell you hey guys, look at the probabilities for a June cut.

[Jim Leventhal]

Well here's my and it's going to.

[Carrie Firestone]

Be a bar that looks like this, right?

[Jim Leventhal]

And we'll be back to where we were where there was a 75, 80% chance of a June cut a few months ago, six months ago. It's not there. So it's tough to play what, what the flavor of the moment is. But here's what I'd say. Companies are in a very unusual position coming out of COVID where they cut people, they cut headcount and then they couldn't replace them. So labor costs went up significantly. They're not doing it this time so they don't have any visibility to earnings. They've said that you've got travel.

[Carrie Firestone]

You have gotten a little more guidance though fair in fairness than I think you or anybody else expected.

[Jim Leventhal]

No, I know there are horror stories.

[Carrie Firestone]

Of guidance but you've gotten guidance in many cases where you didn't think you.

[Jim Leventhal]

Would and that on balance, on balance you've gotten much less guidance because so many companies have pulled their guidance. You've got there's no other period less.

[Carrie Firestone]

Guidance than you normally get. You've gotten more than I think you.

[Jim Leventhal]

Would that's got going to the median. When you do the calculation you won't come out anywhere near the more guidance but one more point. So Los Angeles port traffic down 35% down the goods. So companies margins are going to get hurt. So I don't think you'll see the major layoffs in the major employment. Plus we're still at record employment. So there's a long way to go.

[Carrie Firestone]

I mean there's some companies that think they have pricing power. A lot of companies are talking about raising prices whether it's Adidas or whomever else we mentioned and we showed you yesterday that whether I think it was Abercrombie or even Amazon and some of their products, prices are going up. They think that they have the power. Speaking of guidance and speaking of earnings, Metta and Microsoft tonight and ot Julia Boorstin's with us right now in Long Angeles with what we should watch out for most of all. Let's take it from that perspective. Most of all tonight for Meta is what?

[Julia Boorstin]

Well, here's the thing with Meta. Shares are up 26% in the past year, but down 27% from its all time high in February. And so revenue growth is expected to slow to 13 and a half percent slower than the 21% revenue growth in the fourth quarter, while earnings per share are expected to grow 12%. But even more important than this quarter's numbers is what Insight Matter gives about its future, especially with all this uncertainty. Investors are watching the broader ad market, whether Meta is seeing signs of weakness amid so much uncertainty. And Chinese ad spending is in focus. In particular, Moffitt Nathanson estimated that Medic could lose $7 billion in ad revenue from China alone. Another key focus will be on AI. Yesterday, the company hosting its first AI developer event and announcing a new standalone Meta app. William Blair saying, quote, we believe in the longer term that the stock will at least grow in line with the top line and that longer term benefits are still not fully appreciated by investors. Investors are sure to press Metta on how much the company will invest in AI and expectations for when those investments will pay off.

[Carrie Firestone]

Scott, you didn't mention regulatory. Does that mean that the, that the street thinks that all of these issues are just much bigger in the current time than trying to game out how all that's going to play out?

[Julia Boorstin]

Look, you are right. The FTC trial continues to drag on in Washington and we heard from Javier Olivan, who's one of the senior executives at Meta recently. But while that continues, I think the key question here is what's going on at Metta in terms of the ad market? Advertising is at it's bread and butter and they and analysts and investors want to know how much it's going to be impacted by all this geopolitical uncertainty and tariffs. And then there's this question of where media is spending all of its money which is investing in AI. How much of that is already starting to pay off in terms of boosting that ad revenue? And then long term, can they make this new app that they just unveiled yesterday a New standalone app and a real revenue driver the way their other apps are.

[Carrie Firestone]

Yeah. Great perspective Julia. Thank you. Julia Borson setting the table for us for a highly anticipated earnings report. Carrie and Joe, you on the stock. I want to hear from you both. Carry you first. Sorry Joe.

[Rick Reeder]

So Meta is down 25% or more since its peak and it had a great two year run starting in November of 2021 when the stock got just totally trashed. So if, if you look at what's happened over the past few years, a lot of people who didn't like the stock and really resisted have come into it and so it's become a very, very popular name for good reason because they beat expectations time and time again over the past couple of years. So now we're down a lot because there's concerns about ad spending, there's concerns about what's happening with AI spend. What are they doing with giving things away free? Not for free. How are they competing within their segment? What we would say is the stock has been in its own bear market recently. It's 18 times next year's earnings. They still dominate in many of the categories where they exist and they continue to grow users. Would we sell the stock here? Not at this price. Would we buy it? Let's see what happens because perhaps, perhaps.

[Carrie Firestone]

There is another downshift 27% down from its 52 week high. A lot 640 is the new price target at BO at B of A today. That's reasonable upside obviously from here Joe.

[Joe Terranova]

Relative performance is very important when you're looking at the max 7 arguably more important than any other sector or strategy within the market and you've had relative outperformance year to date for better and for Microsoft so that means maybe the bottom are slightly higher. I think the impact of what China revenue which is 11% over all of their total revenue is going to be important. I think a lot of people are really not understanding the significant loss of revenue that is going to come from China. I do think they'll be able to buffer most of that in the similar capacity that Alphabet did. Which is what? Buybacks $70 billion buyback plan from Alphabet I would expect to hear strong numbers from better tonight and I also think that the entirety of all these mag7 with over 500 billion to spend on buybacks I think they're actually going to be doing that and I think that's probably a reflection whether it's accurate or not that metaphors comfortable in the environment that we're in. They're not Saying, okay, let's hoard the capital.

[Carrie Firestone]

Okay. Weiss. Microsoft shares are on pace to snap a four month losing streak. They were kind of the first ones in to the sell off and they look to maybe be the first ones out or certainly one of the better. They're up five of the past six. It's the best Mag 7 names year to date to our point. What's your expectation?

[Jim Leventhal]

My expectation? I have none. I'm concerned about the quarter there. I'm concerned about the quarter with, with, with Metta. Just don't know, you know, I mean Microsoft performed so well recently because it performed so poorly before that it got thrown out, you know, with the software assault on software stocks and I don't feel good about it. However, you know, as I constantly say with matter with Microsoft, they're permanent compounders and they have great management teams. They're not always going to be perfect and be able to navigate through the dark winds and the dark times that we see, but they will be there. So I choose not to pay taxes. I periodically do sell calls, but that's such minimal protection to do that that I'm just sticking with the positions. And if they took major hits down in a volatile market where a stock can be down 25%, then I would think about stepping up. Even though they're both core positions, I don't have a lot of room. I've got more room since they've traded down though in the portfolio.

[Carrie Firestone]

Jimmy?

[Steve Weiss]

Yeah. So I had a small position in this for several years and a month ago I added to it and brought it up pretty much close to a market cap weight that was at a price of around $379. What my thesis is here is we all know it's a great company. The question is what to do with the multiple which for many years was hanging out in the mid to low 30s and now is in the mid 20s. Is that low enough? I don't know. But I'll tell you what would make me happy is just to see continual earnings surprises so that the multiple organically gets cheaper. Is this a company that should sell in the low 20s as far as a multiple? I don't think so. I will say one thing about the stock though. For many years it had that mid-30s multiple because it was intellectual property. It was asset light. Now we know with these data centers it's becoming a little bit more asset heavy. That will bring the multiple down again. To summarize what I'm saying, mid-20s multiple like net. Right now I'd like to See earnings outperformance so that the multiple automatically comes down and then can re rate a little higher.

[Carrie Firestone]

Probably fixate as we always do on.

[Rick Reeder]

Azure growth Growth just one quick thing on Microsoft we feel as it's become as Apple was the safe haven, it's the defensive name. It has an enormous amount of cash subscription model assets, not a lot of manufacturing, not a lot of tariff threat for Microsoft.

[Jim Leventhal]

Well they actually do because the massive build out that they're going through and the servers those are all hit by tariffs and you're seeing with semi freezing relative. Relative, relative. Absolutely. It's not like an auto company relative to Apple they do have big hits.

[Joe Terranova]

I agree with you. 29% on Azure Growth is the critical number and I think you have to ask yourself why in the environment where they should be a port, a port of safety, port in the storm are the Mag 7 thank you. Are the Mag 77 underperforming the S and P? Because that's very interesting and it's certainly unique to what we saw in previous years.

[Carrie Firestone]

Let's squeeze one more in. Jimmy. Earnings Qualcomm. That's also tonight, correct? It is not a lot of pub. Right? It's all met at Microsoft but you own this name.

[Steve Weiss]

Yeah. A few thoughts here. One, the multiple is so insanely cheap, 12 and a half times this year's earnings that I think it has priced in a pretty big earnings disappointment if you ask me. The questions that I'm looking for are not the smartphone. I'm not a believer that we are in or imminently going to be in some upgrade cycle, some super upgrade cycle. But the question is how are they doing with the automotive business? How are they doing with Internet of things? In short, how are they doing with diversifying their product stream? That's what I'm looking for.

[Carrie Firestone]

All right, up next, we do have more committee stocks in the news and our committee making moves today. A big winning streak for one name having its best month in some two years. We will tell you what it is and we'll trade it. We'll do that in two. For 140 years MultiCare has been in Washington prioritizing long term solutions, partnering with local communities and expanding access to care. Together we're building a healthier future.

[Fidelity]

Learn [e-mail] 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 [e-mail] credit card based on the February 2024 Nelson report. Breaking earnings from two of the Mag 7 stocks, Meta and Microsoft. Plus quarterly results from Qualcomm, Ebay and Robinhood, John Ford, Morgan Brennan Closing bell overtime today 4 Eastern and streaming on CNBC.

[Carrie Firestone]

Many committee stocks on the move today. We hit Visa first. Take a look at the action in that name today. Everybody but Weiss on this desk owns. Look at that action.

[Joe Terranova]

I used to.

[Carrie Firestone]

Unbelievable action today.

[Jim Leventhal]

I used to and regret.

[Carrie Firestone]

He owns up 0.03%. Hold on to your hats. What's going on here? The revenue speaking of keeping their outlook, they kept theirs.

[Joe Terranova]

EPS beat nice 30 billion buyback again. You know that's going to be the financial engineering, the buyback.

[Carrie Firestone]

Why is, why is it, why is the reaction muted if they did what many are doing?

[Joe Terranova]

You said because basically everyone's in the stock people.

[Steve Weiss]

It's worse than that. It's that people. If you're going to have a recession, consumption is going down. The consumption number in the GDP report was not good. I don't care if it was positive. So look, I know these are trades at a premium multiple. I'm in it. Relax. I like it.

[Carrie Firestone]

All right.

[Steve Weiss]

But here's the thing. Here's the thing. If you're going to get a recession and a real recession and layoffs and consumption going down, then Visa's business is going to be impacted no matter what guidance they're giving today.

[Carrie Firestone]

CEO said the consumer remains resilient and they kept their outlook. The revenue's up. What the heck more do you want in the current environment, positioning.

[Joe Terranova]

I respectfully disagree with Jimmy. I think. I think that's way too complex of an explanation. I just think people, everyone's long the name. It's on the VIP list on Wall Street. And when everyone's long the name, you really have to blow out the quarter to get a significant appreciation.

[Carrie Firestone]

Okay.

[Jim Leventhal]

Yeah. New buyers are too crowded.

[Carrie Firestone]

Nobody goes there. That's what Joe said. That's what Joe said. Big respect to Yogi Booking Holdings. Q1 beat estimates international travel offsetting weakness in the U.S. carrie, that's your stock?

[Rick Reeder]

Yes. Sales were up 8%, bookings up 10%. Very strong. Gave good numbers. A little softness now. Right. Because we understand people aren't coming into the United States as frequently. It's a short term problem. And we would think that the reason the market is holding. Holding it up. And it really didn't drop. There was an expectation that the stock would fall because they're pulling back some of the guidance that didn't happen. And it's because people know this is the top in the field, best technology. And this will be temporary. And then people will travel more quick.

[Carrie Firestone]

Jimmy, the most defensive stock in the market right now is what? Quick Five.

[Steve Weiss]

Absolutely.

[Carrie Firestone]

No, no. Joe. Three, two, one. No wise. Netflix.

[Jim Leventhal]

Netflix.

[Carrie Firestone]

Netflix.

[Jim Leventhal]

That would be my.

[Carrie Firestone]

Joe owns Netflix, by the way.

[Rick Reeder]

Sure.

[Carrie Firestone]

Seven day win streak. It's going for eight. Up 20% in April on pace for its best month since May of 23.

[Jim Leventhal]

Pricing power. People will cut back on other streaming services. They're the best one out there. It's my favorite stock.

[Joe Terranova]

Sprinkle in a little momentum.

[Jim Leventhal]

I'll sprinkle a lot of it. And I'm happy.

[Carrie Firestone]

That has had a lot of momentum. Yeah, that's our look at that chart.

[Jim Leventhal]

And they performed great. Quarter.

[Joe Terranova]

Sure did.

[Rick Reeder]

Really?

[Carrie Firestone]

All right, JetBlue. So they have a partnership. They negotiated with United. You own that one. Is a market.

[Mike Santoli]

Yeah.

[Carrie Firestone]

I mean, what.

[Joe Terranova]

But I'm not sure about that. I don't own JetBlue, thankfully. But we do have UAL. We do have Delta in the portfolio. I see trouble ahead fundamentally for the airlines. A lot of friction. And this partnership originally, I think JetBlue was talking. Talking about American.

[Steve Weiss]

American.

[Joe Terranova]

American originally. And that ended. Now they're on to ual. I'm not excited about the airlines, even though we have holdings of it.

[Carrie Firestone]

All right. First Solar, adp, Garmin. You had earnings on all First Solar. Miss. They did cut their guidance. ADP beat Garmin missed their revenues. Did beat. Why don't you take that one? Why don't you take First Solar since it's down a bunch. First quick. And then another one that you want Looks awful.

[Joe Terranova]

Momentum is completely, completely annihilated.

[Carrie Firestone]

Downgraded by two places just to underweight at keybanc to perform at Oppie. Which one did we just show up there that was up. Was that adp?

[Rick Reeder]

Yep.

[Carrie Firestone]

What about adp?

[Joe Terranova]

ADP look good. New CFO talk today about the ability to navigate through the tariff environment. And this is a stock that has been accumulated over the last six months as we've gotten a little bit more diversification within the market.

[Carrie Firestone]

Okay, let's get the headlines now with Courtney Reagan. Hey, Courtney. Hi, Scott.

[Courtney Reagan]

Well, a Columbia University student and legal resident detained in Vermont after being arrested during his naturalization interview was released from federal immigration custody today after a judge ruled that he be freed while he challenges the Trump administration's efforts to deport him. Outside the federal courthouse, Moshe Madawi struck a defiant tone, saying, quote to President Trump and his cabinet, I am not afraid of you. Israel said today it carried out a warning strike in defense of the Druze community in Syria, which it has vowed to protect. Israeli Prime Minister Benjamin Netanyahu said the strike targeted an extremist group that was preparing to attack the community south of Damascus. The strike is Israel's latest in in Syria, where it views the Sunni Islamists in power as a threat. And Waymo and Toyota are partnering to explore bringing robo taxi technology to personally own vehicles. The company said Tuesday they hope to quickly develop driver assistance and autonomous vehicle technologies for personal vehicles. And the Google owned Waymo said that it could integrate Toyota's vehicles into its fleet. Scott, back over to you.

[Carrie Firestone]

All right, Courtney Reagan, thank you very much for that. Coming up, calls of the day. We've got a price target hike for one of this week's biggest earnings movers, Joe's in the name. You might be too. We debate it next foreign.

[Fidelity]

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 [e-mail] creditcard Based on the February 2024 Nelson report, breaking earnings from two of the Mag 7 stocks, Meta and Microsoft, plus quarterly results from Qualcomm, Ebay and Robinhood. John Ford Morgan Brennan. Closing Bell overtime today, 4 Eastern and streaming on CNBC.

[Carrie Firestone]

All right, we got another carry move I want to tell you about. You made a big deal about being a buyer. Bought a lot of stuff. You sold epam. EPAM Systems.

[Rick Reeder]

Why So EPAM is a consulting company specializing in technology, software and AI integration. The stock came way down in the 22 and 23 kind of disruption of software businesses. And much of their business was also in Ukraine, meaning the consultants had to move them out of Ukraine. We bought the stock down 50% from its high. We thought that business was starting to get better last year. Now the tariff slash geopolitical problems have put all business in consulting, software, AI on hold and we just thought time to step away from it.

[Carrie Firestone]

Okay, let's talk about some calls of the day. Joe. There was a period of time probably Two, three months ago where we talked about a stock like Applovin almost every day because it was the epitome at that time of the momentum trade in the market.

[Joe Terranova]

Yes.

[Carrie Firestone]

Up huge almost every day.

[Joe Terranova]

Yes.

[Carrie Firestone]

And then when those stocks and that factor really fell back to earth, that was sort of one of those that was leading the charge. Well, today it was reiterated outperform at Wedbush. They say they expect the phenomenal growth to continue and believe the company is motivated to prove the naysayers wrong. Probably big short interest in this name. I would imagine we can look that up if we can. But what do you say now?

[Joe Terranova]

So you're right about that. The interesting thing is when you study momentum and you observe it over different time frames, this still has a very strong momentum Signal. Over a 12 month period you're talking about a stock that's still upgraded in 250% during that time. So. So point of entry is always important. I know people say no it's not. Tell me where you go from here. I'll do that in a second. But let's remember we entered this stock last July at $76. So we have a lot of room for error. That being said, the fact that the options market is implying that on May 7th after earnings you get a 20% move. I don't like the viewers. If you don't have a position owning that type of extended volatility, that's just what too much volatility to incur. And the other thing that I see as we look forward is this has been one of the reasons why we've owned it. Besides, momentum has been the revenue growth. It's been growing 35, 40% revenue growth on a quarterly basis. Well, guess what? That's going to begin to cliff. You're going to see the deceleration as you move through 2025, your numbers are going to look like 30, 22%. And ultimately as you get down to the last quarter, you're talking about upper single digit revenue growth. So that's not a good outlook. So yes, we have the position. And we have the position because we prioritize different time frames of momentum and 12 month momentum is really important. But for the viewers, if you don't own the stock, there's too much volatility, there's too much friction in what might be coming. Fundamentally I would just sit back, see what happens after earnings.

[Carrie Firestone]

I did a quick look. It's a 5% short interest, so it's like massive. But it's like, you know, it gives you an idea Though about how, how people are thinking about a name like this, which has had unbelievable growth in the market, doesn't really represent itself on the chart because it's a different story year to date than it was last year. But you get the point. I think CoStar Market Performance Citizens today. That's a. Your stock, Carrie.

[Rick Reeder]

Yes. So CoStar has been moving forward in a positive, positive way on the commercial real estate business where they have the best website and best sort of information platform for commercial real estate in the world. And it's bottom commercial real estate, it's starting to improve their apartments.com is doing better. But homes.com, where they're spending a lot of money is struggling and that's what's weighing on the stock. There are signs that things are beginning to improve, but that's what's happening today. We're just seeing fear about mortgages during a recession, if there is going to be one. And so we think CoStar stock is. It's really being hit too hard and we think it's attractive at this price.

[Carrie Firestone]

Yeah. The housing market is a freeze right now. Cheniere, Jimmy Downgraded peer perform Wolf shares are up 45% in one year.

[Steve Weiss]

Stock's been just a home run, I mean actually for far longer than one year. So if you're going to downgrade it, I can only assume it's on price. It does trade on 19 times this year's earnings. I wouldn't sell it. I'm not going to sell it. Here's why this is all about exports of lng liquefied natural gas. The rest of the world wants it, the US has it. Regardless of what happens with trade deals, we're going to be exporting it and Cheniere is going to be benefit.

[Carrie Firestone]

What's the year to date? Give me a year to date.

[Steve Weiss]

Year to date is up 6.2%.

[Carrie Firestone]

All right, so overall markets out was going to say, I guess you'll take that in a, in a down tape big time.

[Jim Leventhal]

Take it.

[Steve Weiss]

I'll take it. In an absolute over four months.

[Carrie Firestone]

Exactly what you need it, I need it.

[Jim Leventhal]

We all need it.

[Carrie Firestone]

So Spotify Joe. So this was a name that Baruch bought a few days ago. Then they had earnings. The stock went down a bunch. It's rebounding now. It's up four and a third percent. The price target goes at JP Morgan to 670 today.

[Joe Terranova]

Well, it's the analyst capitalist community that's saving the stock today. And that's why you're seeing the dramatic rebound. I think the 12 month price target 656, a lot of people coming out and emphasizing an overweight on it. The question here is do you ultimately believe this has the same recession resiliency that Netflix does? A lot of people have said, well, okay, this potentially is the Netflix of the music industry. They certainly are delivering. There certainly seems to be a consumer that wants to continue to utilize the product and we are maintaining our position.

[Carrie Firestone]

Ray J. Got downgraded to neutral at B of A. That's yours. Slowing organic growth, you think?

[Joe Terranova]

Asset management community obviously struggling in an environment where you have this mercurial nature surrounding the tariffs, elevated volatility and really a roller coaster ride in the equity markets that ends up to nowhere.

[Carrie Firestone]

Okay, we'll come back right after this break. Santoli on the other side with his midday work. Senior markets commentator Mike Santol is here with his midday word. Mike, I feel like even with today's GDP report, though negative, is still kind of too soon. It's too soon to truly tell what the impact of this trade war and these tariffs are really going to be on the economy.

[Mike Santoli]

Right.

[Carrie Firestone]

Scott?

[Mike Santoli]

I think we're caught in between on multiple fronts. Definitely caught in between the kind of hard versus soft data dynamic. We're waiting to see if the economy kind of hangs in there for long enough to get maybe some relief on tariffs and then we can sort of say, you know, no permanent harm done. We're also operating kind of in the borderlands of bull and bear market. The S&P 500 is kind of back to where it was on April 3rd. So right in that gap. So that's another way that we're kind of trying to figure out exactly on what side this is all going to break. And, you know, I don't think it was illogical to figure that once we did rally back 15%, everybody was flagging this area as potential tactical resistance. And so I think the question then becomes, you know, do the mega cap stocks maybe start to act as offense and defense again as they have in the past, or is it just too much of a burden of proof here that they're going to kind of regain, you know, their, their sort of mojo in the investor favor that they had before? Otherwise, it's kind of just we're chopping around until we wait for that resolution that we haven't gotten.

[Carrie Firestone]

I wonder who has more pressure on it tonight, Metta or Microsoft. Microsoft's already gone through some degree of pain.

[Mike Santoli]

Yeah.

[Carrie Firestone]

In the market and it's trying to, to get out of that world.

[Mike Santoli]

They both been kind of derated and they've cooled off quite a bit in terms of the stocks. You know, I do feel as if matter was more recently kind of the glamour story and basically the crowded name. So we'll see if maybe that's the one that does have have more to answer for. But you know, in both cases, it's going to be a lot of questions about what are you getting for all the spending.

[Carrie Firestone]

All right. I'll see you in a little bit on closing bell. Look forward to that. That's Mike Santoli. Mike's going to have a busy weekend. To a programming note Saturday, Mike and Becky Quick are going to be live in Omaha at the Berkshire Hathaway annual shareholder meeting. We're going to bring you the entire meeting right here on CNBC and streaming on CNBC.com and CNBC. Plus, it all gets going at 8:30am Eastern. And we hope you will watch. We'll do the setup next. All right, let's do the setup. Allstate is today as well, Joe, after the Bell.

[Joe Terranova]

A lot of good news has been priced out from some of the earnings reports already, whether that be Chubb Travels or Progressive. If you're focusing on these stocks, this pricing power as it relates to auto insurance, I think Progressive is probably the best name to own. Allstate is good to own as well, just not as strong as Progressive.

[Carrie Firestone]

What about Lilly? Like there's a battle over this name like we haven't seen in quite some time.

[Joe Terranova]

Well, it's the excitement tomorrow in the morning, the excitement surrounding the possibility for an obesity pill versus what we have currently. So with those epics. So we'll learn more about how that is ultimately progressing. But clearly there's very strong momentum in play as it relates to State.

[Carrie Firestone]

Okay, Amgen, Kerry, that's tomorrow after the Bell. What do you think?

[Rick Reeder]

Yeah, I think Amgen's in a good position. The stock got hit with all the fear about tariffs and drugs. Now the stocks Recovering sells for 14 times earnings, 3% yield. They had good results from one of their drugs, an immunomodulator for eczema. I think they're going to continuation of more good news and Maritime, which is their obesity drug, once a month. And they're working on an oral is in phase three in the once a month now.

[Carrie Firestone]

All right, Live Nation, Jyoti, that's tomorrow.

[Joe Terranova]

Stocks up 47% over the last 52 weeks. The concern that you're going to have is that there's clearly consumer demand weakening for live entertainment. And it's reflected in the expectation that revenue growth is going to be down 7% in this quarter. That will be three consecutive quarters that they are experiencing negative revenue growth. Rather I'm not sure how much further that is sustainable.

[Carrie Firestone]

Jimmy, Exxon's on Friday before the bell and Joe talked about crude oil has been going pretty much in one direction.

[Steve Weiss]

It has and yet ExxonMobil is actually hung in there. It's only down about 1.4% year to date which is easily made up for by the dividend. Frankly it has held in there at these low oil prices. I'm not expecting fireworks, just expecting a solid middle of the road quarter. The main advantage of ExxonMobil is its size. Economies of scale are going to matter more and more with energy prices as low as they are.

[Carrie Firestone]

All right, good stuff. We'll take a quick break. More trades on the other side. I want to show you some of the best performers in the S&P 500 this month. Why are we showing you this? Because Palantir number one up 37% that's a Jyoti stock. So is CrowdStrike, GE, Vernova, Stephanie Link, Netflix we've already discussed. And then of course their ServiceNow at the bottom up we will round up to 19%.

[Joe Terranova]

Joe, first of all, ServiceNow has defied the entire performance of the software industry. Beyond that, Palantir has made this staggering recovery was $68 just four weeks ago. It's now pressing back as I look towards its all time high at 125. They are going to report earnings on Monday. Okay. I'm not a believer and you buy stocks ahead of earnings but I am telling you on the other side of that earnings report, be very careful if you're thinking about shorting this name because it could significantly, significantly break out above 125.

[Jim Leventhal]

So well positioned with the administration with everything the administration.

[Carrie Firestone]

Why has ServiceNow defied the software softness?

[Joe Terranova]

Diversification I think more than anything else. I think they've diversified the model very well.

[Rick Reeder]

And it's those sunglasses he wears all.

[Jim Leventhal]

The gotta love the CEO.

[Carrie Firestone]

All right, Bill McDermott. All right, final trades next 3:00. We're going to take you right up to Meta and Microsoft today. Greenhouse Mahaney on Meta link talkington and the CEO of the Texas Capital Bank, Rob Holmes. I hope you join me then finals farmer Berkshire Hathaway.

[Steve Weiss]

Let's see how much cash they've built up when they report on Saturday.

[Carrie Firestone]

Yep, we got the annual meeting as we said. We'll be there. Mike Santoli and Becky Quick will be Weiss Vertex.

[Jim Leventhal]

It's been acting well. Gervinex from all the reports is really doing quite well in the launch.

[Rick Reeder]

S and P Global had a good quarter.

[Joe Terranova]

Stocks moving on like that name cme anything trading.

[Carrie Firestone]

All right, I'll see you for the last hour on the Bell 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.

[Scott Wapner]

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 halftime reportdisclaimer CNBC is.

[Fidelity]

Your ticket to the annual Berkshire Hathaway meeting. Warren Buffett meets with shareholders Becky Quick and Mike Santoli with full coverage. Watch live on air or on cnbc.com. start Saturday, 8:30am Eastern. CNBC.