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tv   Fast Money Halftime Report  CNBC  August 24, 2016 12:00pm-1:01pm EDT

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should employ in because i'm going to miss out. go into disney?
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not going to miss it. apple? not missing anything. nothing is going on until yellen pulls the trigger on the 25 bips or not. got to wait for that. guys aren't meeting without britain the first time. hear what they have to say. show me why i should employ this cash? >> what about you, josh? clients tie you up. a check for x number of millions of dollars pup say, you know what? you wait. >> listen, the absolute deal with this. where it's new client, or respective new client and a lot of them in cash, sometimes not for like waiting, miss the whole rally. sometimes sold business. decides, all did or all out. one of the things that makes sense to answer the question, dollar plus averaging. another thing that might make sense, instead of focusing what am i missing the next three months?
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buy on the day. missing in the next ten years if i quote/unquote wait for the right time. not suggesting anybody do that. not here's all my money. throw it at every index. log in and not necessarily time the market but govern our own -- a. great point. not able to time the market. nobody out there, i don't care who you are out there, can time this market. >> steve weiss can, actually. >> steve weiss can do anything. the exception here. in terms of looking at individual opportunities or sectors maybe you should lay into or get in, where would you go, steve weiss? >> interesting. i actually had a conversation and answered the question you just asked josh, except you look at it a little more broadly. look at asset class, look at different types of investments. it's nome stocks versus bonds. but that specific question, another question i answered today for somebody else. to me credit is egregious overvalued in areas, particularly spread. the ten year is ridiculous.
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not paid for the risk taking. equities, fairly valued, maybe slightly over valued. i expect yellen to be more hawkish. i think set up or at least not at dovish as she's been and expect the fed to go into september. if they don't go in september, the next meeting. where do you go? to me, take a longer duration outlook, because at best i see low to mid-single digit returns in the public markets whether it's credit or equity. so i want to lock up my money longer for where i want to go is go where dodd/frank created the opportunities to over regulation and be careful about it. i don't want to go to a lending club underwriting is not what it should be. where companies are not buying loans. banks aren't buying loans. >> what is the lead to? >> however, acting well, has been banks recently. add it to my bank of america. still like -- >> oh, okay.
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apparently. i have patience for that. >> and stories, orbiting, atk, stock destroyed. started to buy that recently. there's a rick, but i think extremely attractive. >> and accounting issue. >> right. >> actually created a great opportunity. melissa to your question, where do you go here? one thing that's definitely worked to my advantage this year is value. within value, stayed away from commodities and basic materials bernal we've had an energy rally. i don't think that will continue when you look at the count here in the u.s. i'd stick to the non-commodity value stocks leading us to old line technology. cisco systems, qualcomm. talk about some of the retail sectors like tiffany's later today. there's still value there and frankly, look, there's been so many people who disbelieved this rally. got under invested in january and february when the market was falling apart. and now they've been playing catch-up. play it in the fourth in quarter as well, propelling the entire market higher but value
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continues to lead as it has all year. >> kevin, back out to you. you're an opportunistic guy. even though you're waiting in large part, aren't there still opportunities right now that you want to get into? >> melissa, first of all i'm 60% invested. three liquidity, actually four. i like the idea of going in to financials with a concept that maybe the fed will finally give us a couple great -- you have to ask banks, no question about it. the problem, the fifth -- every time we come up with this idea, the most beaten up sector, lowest and worst on returns, in this asset class. you would think it bottomed out. the fed doesn't move in september that trade will take you down 4% to 7% again. i hate that. hate losing 4% to 7% because somebody got it wloorong what t fed would do. going to vegas and putting it
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all on black is what that is. >> i don't disagree at all. as a matter of fact, i traded it, and added to it actually this morning, revved it up a little bit. look, that's what they need. and they'll be into persia a long, long time and never retain what was in the past the rle targets. go where people hate things. last month i bought, up over 20%. why? because everybody hated it. yet it's a quality company. just went through its cap cycle. bought another, doing well, because everybody hated it. the market's brutal if you miss and if you buy a quality company and consider the upside to it, your down side can realize and then you see the up side. >> quick -- >> coming back to the financials, more to it than just the fed. kevin is right in the short term, but past the next month or so look at earnings, continued to outperform in the financials despite the low interest rate environment nap will continue. >> switch gears and emerging
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markets and rally mode. eem up 15% this year. and global chief investment strategist, upside in merging equities. great to have you with us. you upgrade emerging markets to an overweight. did that happen today? >> we upgraded last week. >> all right. is that after, still, a sizable rally. why now? >> yeah. emerging markets have done very well this year. and think we can do better. seeing evidence this is moving into a virtuous cycle. a positive environment a sweet spot for in time. you're seeing that, spreading out to something that's more sustainable. fed on hold, creating a more stable dollar. created flows into emerging markets, and now those flows into -- healthy interest rates come down, within the year. 25 rate cuts in emerging markets this year and now most importantly, starting to see that with some improvements in
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the fundamentals within emerging markets. earnings momentum turning positive for the first time in five years. we think that's going to lead flows back. >> and in terms of some of the major macro drivers, those are already in and going forward, they may be diminishing. i mean, the fed staying lower for longer. most people believe there's going to be rate hike sometime by the end of the year or early next at the very late effort and in terms of recovery in commodity prices we've seen a lot of that and seeing oil buff around a lot of analysts saying, we'll be in this. what is actually the thing that's going to keep emerging markets going from here? if those things are all on the table are diminishing? >> firstly, the 15% rally in em this year into context. that comes after a 40% decline over the previous three years.
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in terms of flows, 26 billion come back. >> a year. a lot of money. 150 billion went out since 2013. simply reversing a very small amount of the under performance over the previous three years. so your question is okay. so what gets this going? what gets this into a much more sustainable ral rally? the fed cautious needs to remain in a cautious stance. i think the stable dollar is critical, but what really starts to get flows accelerating, improvement in the fundamentals. you mentioned stock, earnings pick up, see growth stabilized. the global interest rate, more stable global economy is creating an environment where that low-growth world actually emerging markets have started to look like the most attractive option. >> so, richard, i actually agree with what you said about putting the move into context. up 15% year to date, but 40% off the low. when you take it back further, from an asset allocation
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standpoint and think about lean reversion and how long and how drastic the under performance has been, you're asset class is essentially flat over five years while the s&p is up, i don't know, 75%, 100%, in 12-month incremen increments. outrageous to say that, all right, that's it. you missed the trade. one thing i think maybe is worth speaking to and would love your take on this, by definition, this is a volatile asset class. on a monthly basis, 60% more volatile than the s&p. quoting back to the late '80s. is there a point that changes? will em always be, you know, sort nf that same category as small cap u.s., where it's just going to be wilder than the s&p and people have to deal with it if they want that diversification benefit? >> i think always more risk associated with emerging markets. political risk, economic risk. to some degree covenantsy risk.
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are you paid for taking that risk? the conversation you heard, look at the bell market, look at credit. increasingly you're not being paid in any part of the market for taking risk, when emerging markets you still are being paid. also worth noting you see this back-to-back recently. vast majority of our clients, investors around the world, still underweight emerging markets, still scarred by the experience of the last three to five years. this is a small move in the context what we've seen previously. >> richard, also underweight europe. why? >> well, concerns primarily around the banks. a low growth environment, a low interest rate environment creates huge structural head winds on the business models of the banks. we don't see a lot of those things changing soon. in fact, see those getting worse, particularly the interest rate environment from the european central banks. the banks themselves are relatively slow to address those issues in terms of cutting costs, transitioning business
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models's that keeps us cautious. still think it's too early to buy into some of those notionally cheap sectors where the head winds are still strong. >> thank you for joining us. appreciate it. kevin, go to you. anybody who's tuned into the network sees you talk about europe. you like europe. >> i do like europe. richard made a point about money center banks. a disaster in europe. not the only sector of the market. i agree. financial services in sweden, switzerland, the blackrock of switzerland is a good investment, for example. a different company, same strategy. trades at 20% discount to equivalent in north america, pay as dividend, liquid. you can find many other situations in europe basically the story's this, why i don't agree with richard. let's leave out the sector, the financial sector, which is a poor underperforming sector just like it is at home, and look at every other sector in europe. basically the story is there. a 20% discount to the pes we pay
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in north america at a 40% increase in yields coming out of those companies whether britain, england, swede be, switzerland, france, even italy, and the worst economy on earth. 450 percen-- 50% of the time outperformed us. to not have exposure is a mistake, in my view. i'm a global investor looking to point capital. i can invest in financial services in europe and including a discount, 40% higher yield, yeah. i think i'm going there. not for 100%, why not 50% or 20%? exactly what i'm doing and so far europe has been less volatile than the u.s. and i -- >> what's your favorite name right now? favorite stock? >> nestle. largest holding is nestle, in europe now. and rewarded for owning that. that stock is basically a play on the u.s. managed by swiss managers and they do a fantastic job.
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give you other ones i like. roche. people think it's a u.s. company. it's actually a european entity that has a huge head wind at a lower currently. vis-a-vis selling it's drugs. you find these stories over and over again. we ignore it because we're looking myopically at home. what's wrong with taking a dab of europe and paid to take the risk at low e pe, less lull and a big, succulent juicy dividend, which i lap to like. >> europe has an index, never as cheap as it looks. >> why? >> look at -- >> reason, because financials have such a higher weighting than the u.s. guess what? they don't have tech. so when you take a look at the pe, the discount it deserved and the u.s. actually looks like a cheaper market when you break it out and go through what's underneath. to me, the case that blackrock made, i don't really agree. sounds like the case that should have been made a year or two ago, because what you said. low for longer is an old story.
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>> right. >> the u.s. is on the cusp of tightening, actually, one of the risk, stronger dollar. distorting dollar and europe won't ease anytime soon in my view because u.s. tightening is de facto easing everything else in the world. >> we mentioned european banks, showed you quarter to date. they have perked up. buyer of the -- you say, no. what? >> just there's too much opportunities in the banking sector here in the u.s. first off, kevin makes a good point about dividends. you realize that the american banking settinger will raise dividends. on valuation, price to earnings or price to book, a lot of value in the u.s. banking sector. i don't see a reason to take a rick overseas. >> seen this movie before. the u.s. playbook, what's happening in europe not. not going to make any money. >> mr. wonderful, stick around. a lot more ahead on the "halftime report." >> announcer: know big purchase for pfizer. the second in a week. is this company making the right moves and if so when will the stock start moving? to have and to hold.
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tiffany versus signet, to which would you rather have your money wed? more "halftime report" in two minutes. yeah. or, digital industrial.
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and tim cook, apple's ceo. stock doubled. is this a stock to own the next five years or own something different? look who snuggled in. dr. j.
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>> and i was -- low on cash. >> wisdom, dr. jon najarian. all right. >> i would have -- five years instead of having 700 million, i think double. and the service side of the business strong. yes a stock i'd own for years and years. >> steve, you don't own it. >> i don't own it. i think there are other places to -- be in the market. >> what in technology? >> look i love stocks, companies where they have a major cap ex cycle and come out of that and all with depression, new products. this next quarter, 15% to 18% of revenue is coming from new products and they'll build on that. great. everybody hate it. analysts don't get it and you reap the benefits. that's what i like. nothing wrong with apple, i just don't worship at that temple.
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a quality company, quality management, but i think market stock. >> do you own it? nothing wrong with apple, just may not be the gainer had once had been? >> looking out the next five years. over any quarter i wouldn't try to make a cull on apple. over the next five years at least two more iphone upgrade cycles. probably those boring to you, steve, i can understand that were. why people don't want to own it however it will generate more on the services side jon was talking about and continue to generate cash. that's where it's interesting. the cash. because i think sometime in the next five years some tax regime change allows ap toll repatriate some overseas cash and distribute to shareholders nap will promote further gains in the stock. >> kevin, out quite a while. considering getting back in? >> look at it again next quarter. dr. jon brought something really interesting about this services
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concept. the only reason to own apple now is if you believe as they broaden out the base of handsets, i call those the trojan horse, get them in the hands of consumers, somehow you can sell more services, make the music offering better, get more people to use apple pay. get more wearables with payables apps on there. any of these, very optimistic. three quarters of these, and the actual percentage increase in services as the rollout occurred remained exactly the same as units. in other words, people do not buy more services on the incremental apple phone. i've got to see the change i see more innovations in services would be great. this other concept i like a lot, repatriation of the $200 billion that's not sitting in the states. i want to see it come home and of course like an increase in dividends. that's an interesting idea, but that means we've got to get a trump administration and then a congress that's actually going to drive that process in tax change. those two things are unknown.
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never heard hillary say she gave a damn of any balance sheet. >> her own, kevin. her own. >> you own apple. tell mr. wonderful why he should own it now and not sitting on the side looirlines now? >> might have a point, no confirmation whether or not we install base and translate to a ten-year run of the ecosystem and greater and greater profits. i think it could happen. i think the odds are high. i tend to buy this stock when it's towards the bottom of the cycle, which i did most recently. low 90s here on the show and people would telling me apple then, et cetera. what's to look at here, when you bought this thing in quebetween cycles, historically did well. the buck stops and over. willing to take that risk. a nice total return in terms of dividend, my opinion, buy back, and capital appreciation versus what the volatility may be, and if you think about it
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technically, this is a stock that made an all-time high in february of 2015. essentially it's been in the down trend 18 months. now snapped that down trend to the up side to next level of resistance about 112. if it break, got a shot back at that 30 high. all-in, a buy not a sell. i get the skepticism and that it's boring. doesn't matter. sometimes boring works. >> kevin, hit the twitter verse with #askkevinquestions. what do you think tesla/solar city move for the long term? >> tesla? the question, the stock? >> tesla, solar city. i guess the merger? >> no. a dumb idea. i don't see why if you want to deploy your capital into solar, a crappy business, because it has to be subsidized, it's any better often inside of a tesla. theory being, charging. i don't get it. if tesla wants to fight it out as a car company in the electric space what they should focus on
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and if i wanted to invest, which i haven't, that's what i want to do. now it's a convoluted story and plus insider trading story. i don't even know what's going on. >> hold on. insider trading story? >> well, i don't mean it that way. >> okay. >> you've got a guy who's got big bets in both companies suggesting they're better together. that bothers me. i'm sorry. you've got to show me where the synergies are. he's a fantastic entrepreneur but i'm a show-me guy. show up in earnings and cash flow. frankly, the owning reason i haven't bought a tesla. my engineering son keeps bugging me. worried i'm sitting on something that will radiate my package and that scares me. >> the reason -- >> radiate your package? >> whoa. >> exactly. >> a family show, kevin. >> quick. >> the reason they're better together, bears say, solar city collapses elon musk has a really big problem on his hands, and then you could make a whole 80-page presentation about the synergies if you want, and
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believe that, but the bears would say, they're better together, because they're needed to be some kind of bailout here based on loans -- >> josh, a horrible reason. >> i agree. i do. >> for merging these two companies together. >> i'm with you. we're on the same page. >> kevin, got to let you go. always great to see you. thanks for joining us. >> take care. bye-bye. >> keep your package safe. and kevin o'leary? >> i didn't bring it up. >> the package -- >> did i bring it up? >> they didn't teach you to talk that way. >> and kevin? >> pronunciation -- >> one of cnbc's brightest stars, tonight at 10:00, introduce another, ever heard of lebron james? of course you have. his new show debuts tonight right here on cnbc called "cleveland hustles" about building business in cleveland pap good one. and a week for valiant, sizzle in starbucks. pick up the trades and much more in "the blitz."
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pfizer, pharma has issues. time to get in or run away? "halftime's" back in two. more affordable so it can reduce emissions around the world. that's what we're working on right now. ♪ energy lives here.
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hi, everybody. i'm sue herera and here's what's happening at this hour. a 6.2 magnitude earthquake struck central italy leveling three towns. at least 73 people have been killed. hundreds more injured. rescuers are working to save people under the rubble, and
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official doss expect that death toll to rise. in myanmar, a 6.8 magnitude earthquake shook the central area of that country damaging scores of pagodas in a major tourist attraction. at least three killed. the quake centered about 15 miles west of chauk. and back here at home, recalling suvs because the engines can stall without warning. from model years 2013 to 2015. a new study says many patients who survived a heart attack don't consistently take medications prescribed to prevent life-threatening complications. more than half of patients did not take meds at least every four our five days. scary. back to you.
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pfizer's buying spree back on. a deal to buy astro genica, you're wrong. do you like the moves? >> i do. what pfizer is doing, getting ready for the split. the street really wants them to split into the innovative products business, and the established products business. medivation was clearly going into the innovative products. a great acquisition. a drug there for prostate cancer we think can double in the next couple years in terms of sales, antibiotics, a lower growth area, something in the established products business they can still milk a lot of cash flow from. again, the street really does wan pfizer to break up. on the last earnings call they threw a little cold -- just a little cold water on it. the street was looking for them to confirm it. they said by the end of the year they'd make the decision. making these two very desperate
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acquisitions clearly signals to me they are going to split up the company. >> what in they don't and made these acquisitions? make sense to you? >> i don't think there's a none the stock at the split. >> about 10% year to date. >> i bet you get another 10%. i say that because you go back pre-earnings, up about 5% higher and had they really confirmed it, would have put another 5% on the stock. >> my point. not a lot in the stock right now, for them to split the company apart, and it remains to be seen if it will happen, because then the arms line up, you don't know until it happens. for me i still like the biotech space, they're the targets. much more exciting, what's happening there. the growth is huge. the fda still very accommodati e accommodative. you need to own a basket of them or own more of the more mature names. i'd rather own somebody with growth that doesn't have to go out and buy growth. be that an amgen, vertex or i
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own, love, but you have to have protection. >> one quick point. pfizer is definitely in the more boring category. if you get 10% plus 3.5% dividend yield, particularly now until theened of the year, you're right. not a biotech shoot the stars 0 ut. not what we're looking for there. >> quick, a really popping company today -- >> without real news. the stock's making a significant pop. sort of reached out to stephen. sarpeta. meg terrell, not on the trading side, the news side. volumes exploding. volatility is only half of what it was at the highs of year, mel, which i guess you'd expect, because 28 and not 10 when it traded down through 10, traded into the 8s, when the volatility got up over 400. them looking like, as steve said, something by the end of month or get news by the end of the month, where the bets are. >> all right. hit trader blitz. first up, intuit.
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first quarter guidance? josh? >> depends if you're a trader or investor. investor, company will be fine. quick books user, small business ecostill. all up huge double digits. a trader, just snap the 50-day to the down side. maybe give it time before it sets back up again. i think long-term, it's good. >> express thinking about missing on the top and bottom lines, recording an 8% deline in comp sales. >> clearly, bad quarter. down 25% seems way overdone. i don't think the company has materially changed in its one quarter less today than it was yesterday. >> context, up 12% over the past couple weeks because of retail in expected earnings. >> right. we've seen for the umpteenth quarter, haves and have nots within retail space. what you do, let it bottom out. way overdone on the down side. >> same sale stores down 8%. margins just getting crushed. those are two of the biggest
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reasons. the guidance sucked. >> all right. starbucks -- family show, guys. again. >> sorry. >> starbucks, unusual activity, doc? >> luckily with you on monday, mel. talked about the unusual ak tishty in starbucks. 55 calls, 5550s xpeexpired this week going out into september. a 5.5% pop. options doubled for him. pete still in them and i unfortunately did not have it. >> in valeant, moving higher again. get this run over the past month. up 42%. what's happening? >> incredible. i've been on the sidelines for this and a naysayer. look, picked up momentum. if you're a trader, been on the sidelines in health care, this is one you're going to, because it has had some good news. if you also look at endo, endp, ceo there, used to work for the ex-ceo, has somewhat of the same model. that stockal moving up, reported
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add good quarter as well. my guess is momentum can continue. it doesn't solve the issues before. definitely the company is trying to do all the right things. >> all right. piper jaffray, trading energy to overweight. oil the firm's top commodity play. do you agree? the "call of the day" is next, plus dr. j seeing bullish buying in a retailer with a rough ride over the past year. is he following the crowd? is that his trade? ahead. rototype to match customers to gear. watson, let's give it a try. say it's mid-june and i'm backpacking in yosemite. of our 353 jackets, i can recommend nine. watson, what if it rains? there is just a 3% chance of rain, so i recommend the breathable stretch fleece fuse form dolomiti jacket. a perfect choice watson. no wonder our customer loyalty numbers keep climbing. i believe we can do even better. i like the way you think.
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biggest one on the street charging into the energy sector's pieper jaffray overweight, reversing a multiyear turnaround appears constructive. our "call of the day." does this -- have we made the easiest gain? >> not saying a late call, also downgraded enron in there. >> say it. say the call. >> late. where you been? oil's -- >> it's a late call. >> xle, the stocks themselves, forget about the price of crude. the stocks themselves are 18% year to date. it's a late call. period. >> and if i were him i would have waited. mowmentum on oil is down dp no
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deal unless the iranians come in. >> iraqs pumping all out. libya coming and retail in the u.s. popping up. shale producers can make money. >> and oil going -- >> one more thing. if yellen does go, the dollar strengthens, inverse correlation between commodity prices, specifically oil and the dar. >> okay. >> sideways. >> here's the thing. not necessarily a late call if there's another x percent higher from here. right? in theory, an overweight relative to the other sectors from here, it's still not late. but you guys are actually saying that the biggest increases in oil prices, oil stock prices, have happened? >> the easy money has been made. >> what i think -- >> are you in oil? >> no. >> you're out? >> going to 40 before 50. once it goes down there you may get supply. see the count going down. then pops back up. >> and saying a late call?
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>> i mean, tactically speaking, strategical strategically, you buy into energy majors. you don't have to be doing that for the next six months. the issue is not, i have no idea if oil's going to 40 or 50. doesn't matter. the point is, did the worst descepter we'll see in terms of charge-offs and problems with their cap ex budgets and realimts and things they use tods do with balance sheets, have we seen the worst of that? history says, probably. >> in his defense a choice. got to say, do i miss it forever or come in at some point? sidelines sit there, missed it. got to get in. got in now and we're heading to task. >> fair. and gold lowest level. with the futures, jackie deangelis. >> good afternoon, melissa. as 15ds drop today. $30.30, anthony, when i see this move in gold thinking dollar fed here. what do you think? >> exactly it, jackie. the dollar is stronger today.
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i think a lot of longs in the market are liquidating in front of janet yellen's speech in jackson hole on friday. i think they're going to be taking profits. a lot of hawkish talk coming out of the fed. but the thing is, jackie, whethered fed raises or not, i think gold still is a buy. >> all right. jim what has to happen for gold to go higher from here? take it one step further. >> she has to disappoint and not talk ops in the meeting on friday. keep in mind, a huge difference between hawkish talk and hawkish actions. we still have several weeks before the meeting, but i any a period of hawk be talk and saber rattling. gold goes back down to 13.15, in one big seller this morning clearly worried about her saying something friday. >> more on gold, text the website back with a live show tomorrow, 1:00 p.m. eastern. >> trade it here on the dofk. josh brown? >> i want to point ow gbx, gold miners, one of the hottest trades of 2016, came into the
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year low teens. etf. up close to 30. now it's rolling and rolling hard. rsi confirms this move lower at about 35. not quite yet below 30. where i would say totally oversold. due for a quick pop. these names have not looked this bad in ay while. just broke below the 50-day moving average. i think it's more of a danger zone than an opportunity here. after such a huge run. >> clearly ahead of janet and her speech on friday, mel. so people are putting the bets on that she says something hawkish. if it doesn't happen, watch gld, moving first, and then the gdx, as josh said, perhaps even -- >> the jewelry trade. over the past year, in correction territory. should you stay away or is now the time to buy? we'll debate those stocks ahead. first, to sue herera, what it's coming up on "power lunch"? >> see you there as well, melissa.
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coming up, mylan under fire a fourth day. spotlight on its ceo. should the fda, however, also to be blame for the soaring costs we see. including epipens. former member of the fda joining us. do kids have too much homework? viral news stories saying, yes, absolutely it's true. a professor says it's true as well. that's coming up. and forget a four-year degree. your new path to a six-figure salary could happen in 15 weeks. all that coming up on "power lunch" at the top of the hour. meantime, "halftime report" is back right after this break. announcer: "halftime report" with scott wapner is "the" place for market-moving interviews. >> you don't call a company a sewer because the company made a mistake. >> announcer: real money -- >> we are short both tesla and solar city. >> announcer: -- real debates. >> people think that globalization has hurt businesses. it's not. it is technology that's hurt businesses. >> competition is a good thing. i don't want to go back to a single marketplace. >> announcer: the most profitable hour of the trading day. >> i love this show! all i do is get to tweet about this show! i'm on the show. this is the greatest moment of
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[ male announcer ] join the millions of people who have already enrolled in the only medicare supplement insurance plans endorsed by aarp, an organization serving the needs of people 50 and over for generations. remember, all medicare supplement insurance plans help cover what medicare doesn't pay. and could save you in out-of-pocket medical costs. call now to request your free decision guide. and learn more about the kinds of plans that will be here for you now - and down the road. i have a lifetime of experience. so i know how important that is. back to the "halftime report." jewellers under pressure, falling double digits over of the past year, reporting before the bell, should you buy either's these ahead of earnings? let's debate it. one side represented.
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on tiffany. why do you like it? >> a bad flashback to exactly a year ago, you were anchoring and tiffany came out with terrible earnings. look, a terrible year for tiffany and signet. a lot of it the asia trade, fell off the map an the chinese long devaluation last year, but that's in the rearview mirror. tiffany's, you want to own it. as long as you believe, and i do, the global expansion will continue. a couple years should earn $4.50 a share pap stock that traditionally trades in the mid-20s. yesalities premium, but for the brand. and if you put 24 times on $4.50 over 100. better than 50% rise in the next two years. but let me be clear about this. i'm not making a call on tomorrow's earnings. seasonally, this is not a time there's a lot of jewelry sales. and there's no reason to think they're going to exceed or disappoint tomorrow. >> labor day is not a time to buy jewels? in terms of, different trades. you mentioned asia trades, luxury, for signet a
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stock-specific story at this point with a huge decline we saw after the -- the diamond verification -- issue that they had, the allegations that perhaps they were -- >> a feeding frenzy for ashley madison. remember, last year, when we were talking about it. we cited that as soon as the ashley madison news broke, mel, people leaked out online and said they're going to be going to buy somebody something shine around nice, put it in a box. not all of you can afford the little blue box and wanted -- >> went to the zale's box. >> the key point on tip tiffany >> i don't remember that, doc. was that a private conversation? >> we hit it over and over again. >> yeah. >> sure you did. >> last word here on the floor. last word. >> if you are in the top 1% of the world and find yourself at 57th and fifth you are walking into tiffany's not signet. that's the power of the brand equity in the name, why tiffany
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will trade. >> out of your mind to buy any real tailor. these stocks parabolic. sure, up 10% or 20% but can be down 25% like express. >> i'm off tomorrow and not making a call. >> i tomorrow's earnings. >> no, you owned it. >> get out of jail pass here. jim by the way is leaving the halftime portfolio challenge walking us through his strategy next.
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time for some unusual activity. dr. j, you're watching chicos. >> well, mel, this time last year this was a $17 stock. as you can see it's nowhere near $17 anymore. and in january it was basically a single digit stock. now it looks like it's right in between the year high, right here around 13.50, and those lows of the year. it's at 11.76. we saw somebody piling in in a big way into calls, biggest buying we've seen in chico's in a long time. so to what jim and weiss were saying when you see a retailer with any activity it could fall 20% or more, be aware of that, but this one, boy, look at this volume today. this was 8,000 in the first hour and a half. it's traded over 11,000 of these calls. now, very aggressive buying. we jumped in here with them and we believe that chico's maybe pushes towards those high of the year taking it back to the 13.50, 14 area, mel.
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>> thanks for that. let's look at the leaderboard in our halftime portfolio competition. have you made any changes lately? >> not too much lately, mel. >> okay. >> really what it's been is a value investment portfolio. and as we all know this has been a good year for value investing. there has been by the way one rule change this year that has been very helpful to me which is that you don't have to go all-in or all-out of a name. so you can leg in and leg out. that's definitely been helpful. more realistic trading to how we actually operate in client portfolios. we've had a few good story stocks that have been winners. >> what's your top performer? jc penney. >> jc penney and then orbcom is second. frankly, not having a disaster has helped this year. >> you can follow the action at we got just about three hours to go to the close of the markets. we got your final trades ahead. much more "halftime report."
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learn how to prevent deaths and injuries by using the right car seat for your child's age and size. a lot happens in an hour here on "halftime report," but a lot more happens during the commercials. we're calling this segment, fast break. >> if i took the tickers of all these stocks, right, and just took retail stocks, whether it's macy's or nordstrom or express. >> uh-huh. >> and i took biotech stocks and took all the tickers off and said, okay, let's do taste test. which is biotech, which is
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retail, right? if you didn't know anything, you'd pick retail as a biotech sector. moves are parabolic on both sides. it's crazy. >> interesting point especially if you look at retailers over the past couple of weeks. they have had gains of upwards of 10%. dr. j, do you agree with this thesis? >> best buy 20%, who would have picked that? and express josh talked about in the blitz down that same amount. it's crazy it's feast or famine. that's why i'm in chico's and i'm in calls, not stock. because i want less risk, but i want the exposure to that big pop. >> right. did all that mean, steve weiss, that you want to stay clear of retail? is that what you were getting at? >> no, it's just that i don't want to be there where there's heavy opinions one way or the other and where the expectations are just crazy. i mean, so at tiffany's i'm not playing for the quarter. longer term is fine. you got to go through it. >> you know what's cool? >> what's cool? >> if you play a clip of weiss
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talking on the air or off the air? >> yes. >> you can't tell the difference either. which is like biotech and retail. but it's a compliment. he's very, very real. >> exactly. on and off he's the same guy. >> i love being lectured by him off the air. >> anyway, we have some weiss fans out there who want to be lectured further. steve is one of the leaders at unc's business school. it's a three-week course covering the essentials of the markets and starts september 12th. you can go to, for more information. our gift to you. with the markets closing in three hours time, let's get to the final trade, stock. >> lending club, broke through 5 and now accelerating to the upside in a big way. i bought that name. >> j.b. >> amgen, broke last year's high to the upside. it's about 173. spent the last three weeks consolidating. once this gets rolling again, forget it, 200 bucks. >> forget about it. >> i'm going to channel my inner josh and say i like the chart on
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pfizer. >> we were all on pins and needles on that one. >> no, i don't poke josh. go play golf, josh, go bowling, go to chico's until yellen speaks on friday morning. that's all that matters. >> that's it for us here on "halftime report." "power lunch" begins right now. all right, melissa, see you in just a bit. hello everybody. i am brian sullivan. here's what's on your power menu. mylan under fire for a second day for epipen prices. but does the fda blamed for this and other type price hikes? is your money stuck? new meaning to the 1%. and forget four years of college, why just 15 weeks could be your new path to a six-figure salary. "power lunch" always on the path to prosperity beginning right now. i'm miche


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