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tv   Fast Money Halftime Report  CNBC  October 5, 2017 12:00pm-1:00pm EDT

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about can apple sustain the franchise and everything else and it's continued on to new powers and new heights. >> certainly with the stock performance. as well as did they institutionalize the magic that was steve jobs i don't know that we have the answer to that yet but certainly the stock has done just fine under tim cook. >> some would argue, at least the stock price would argue perhaps they have. thank you. that's it for "squawk alley. we'll send it over to "the half" with scott wapner. and welcome to "the halftime report." i'm scott wapner our top trade this hour, big tech's big boost microsoft leading it today the etf for technology hitting a better than 17-year high let's begin with tech. we can talk about the markets to be honest with you guys because as we come on the air today in general, new highs again, new highs across the board the dow is up nearly 82 points
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at the high of the day joe, the melt-up continues. >> steve and i were talking before the show. surat and i also had a conversation about how methodical the rise it it's almost like walking up that staircase. i think it's interesting, tomorrow you're going to get the unemployment report. i think you have to begin to really price in is this also beyond just good earnings, scott, is this about growth accelerating is this about repricing the economy maybe towards 2.5%, something that we didn't think was possible so getting yields of 2.35 on the ten-year tomorrow you get unemployment. i think it's very valid to think about this is an economy that's going a lot faster than we thought. >> people who are waiting for a pullback are getting run over by the day and it is so widespread now, whether it's small caps or midcaps, transports or industrials, now technology tries to resume its leadership role you've got big news in netflix,
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an upgrade for microsoft, but the starts to take off within the last 20, 25 minutes or so. >> but you say it all. in the last couple of days we've talked about rotation, rotation, rotation how about the material space today as well. how about the fact that copper is near or through $3 a share. take a look at an absolute and you can look atthat and tell you where copper is going. financials, technology, materials. the rotations continue throughout all the different sectors. but when you look at those, scott, and everybody wants to say, you know what, the financials, they cannot go up any higher take a look at where rates are that's not been the case they continue to plod and go and continue to go to the upside. >> the financials are coming off their worst day in a month >> day in a month. >> worst day in a month yesterday. >> and a pretty good month. >> but here we go with rates creeping back up, steve. cramer and i were talking in the prior hour about the throw in the towel rally of the and that's what this is. you wait, you wait, you wait for
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a pullback, you don't get it just throw in the towel. >> it's almost seeming that it's too easy if you buy a stock, even though the fundamentals haven't improved when it sells off, you go into it because you can make money anywhere to me that's the caution now, that doesn't mean i'm turning bearish. it means i'd like to see a little more volatility. >> in what historically is the most volatile month for stocks, october. >> exactly, exactly. if you go back to the market corrections, you've seen this volatility up off the lower base the dow up and down 100 a day. here we're making new highs every day but it's eking it out. so that's the only thing that i'm concerned about. you always have to have something to be concerned about. >> the services were good, rates are steady. >> and employment is going to get a pass because of the hurricanes but i think what you're going to get is once we get through earnings season, you're going to the stock-specific volatility.
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the stock pickers, if you like certain companies and they missed for reasons that are not fundamental, i think it's a good time to pick stocks. >> are we so priced for perfection now in some of these names that they better deliver or to surat's point, pete, it's going to start out with the banks, you start to get these moves people are waiting for. >> i'm less concerned about the banks. i'd be more concerned about some of these industrial names. take a look, where's boeing right now? and i've been one of those, i love boeing. but the proof is in the pudding. if they don't deliver, that's going to be a problem. i think the financials actually, they have plenty of room and i think there's an easy runway for them to continue to deliver. >> in the face of the dollar getting stronger, that's going to hurt some of these earnings going forward, so expectations might have to come down and you could see that pullback. >> let's say we have a big wheel, like spin the wheel, wheel of fortune you've got all the various areas of the market that are doing so well now if i say you have to buy one
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sector, one area, small caps, midcaps, large cap, growth, chips, et cetera, and i spin the wheel. steve, where do you hope it lands? >> i'm still in tech i continue to add to tech when they miss. not necessarily miss, when there's a downgrade like western digital today. i bought some more, it's been down i was talking to pete yesterday and we both own a lot of micron. crap, micron is down 90 cents today. pete says so i say so, but that's a move. that's incredible. that's how ridiculous it is. >> it's not when you consider where it came from. >> so i still like tech. what josh said yesterday about that being the new industrial, he's absolutely right. so we're in an environment where we've never seen rates this low for this long and the market is not overvalued at about 18 times. it's not >> you can understand, though, joe, why some people hear this kind of conversation and say people are too complacent, it's close your eye and buy the
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market, what could possibly happen. >> absolutely. >> are we too complacent or not? >> i don't think we're too complacent at all. i think what you've witnessed throughout the course of the year is collectively this kind of perfect storm of whether it's in europe, whether it's in the emerging markets or domestically here you're seeing acceleration of growth in terms of corporate earnings and we keep overcoming these obstacles, macro headline obstacl obstacles. you asked before are you concerned about financials think for a second what financials have done over the last 17, 18 years. so i think that validates the point that there's plenty of opportunity on a valuation basis for them to move higher. >> we're going to lead with microsoft. it got this upgrade and the rally itself starts to accelerate but let's get back to microsoft and this upgrade it's to a buy from hold. we've made it our call of the day today. in fact we're joined by the
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analyst who made that move, richard davis. richard, welcome it's good to have you on "halftime. >> thank you very much. >> almost feel like this upgrade plays exactly into the kind of conversation we're having now, a sort of throw in the towel and buy it, right? you've been waiting and waiting for a pullback in microsoft. you say you haven't gotten it, so that in a sense forces your hand, no >> it does you guys were talking about it, but the reality is if you just had one indicator and if it was accelerating growth, that's what you would buy. when we did our analysis, we think microsoft's revenue growth will double from 6% to 12% in five years >> what really -- that's the key to the story because it's obvious that this stock has had a pretty nice run, you know, since the beginning of the year along with all of these larger cap tech names, which are back in favor. >> you're exactly right. i think what's happening is the narrative has come a little bit off track.
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people are focusing on op x and didn't look at the big growth drivers we think will start to materialize. it's xbox, the asoozure busines and the o-365 upgrade. it's pretty interesting. >> as you go back over your career, when was the last time that you said over the next five years to justify a buy rating on stock? because i'm not used to hearing analysts say that. i've been doing this for a long time it's over the next year or two i understand that's different for investors and me also like to hold for a longer term. it seems to me that's not a good time that you have to talk about the five-year growth in order to just fee a buy rating. >> on the existing valuation, it's not bad if you look at microsoft, it's probably a 10% discount. on an earnings basis it's more or less in line with where the companies are. so our view is to get the double
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in the growth and the double in the stock, you don't have to have any multiple expansion. so you're kind of like right at a market multiple and discount on bid of free cash flow so it's not too far of a stretch, but good question. >> richard, i totally agree with you on the accelerated growth and that's we pointed to for a very long period of time he's been the aggressor and going after the growth areas and that's been the transformative part of microsoft. it's why it went from $35 a share to $75 a share are they going to do anything in terms of acquisition we know about the cash, we know about all the repatriation conversation and all the rest of that do you see an acquisition somewhere in the near term for microsoft? >> yeah. we kind of talked about that in the note basically the answer is yes. obviously they don't share that with us, but there's multiple avenues they could go. they could buy in marketing. where they could go is make a big move in the e-gaming space to bolster the franchise they have with xbox, so there's a
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bunch of different opportunities. look, they generate $30 billion of free cash flow. that's a lot of money to throw around >> you're looking at a price target possibly by the end of calendar 2020. that's not that far away. >> right. >> $115 to $120. that's a nice move from here. >> as i said, it doesn't really imply that you have to have a multiple expansion, it's just keep the multiple about where it is hopefully it's not too aggressive >> it's good to have you on the show interesting call. >> thanks so much. >> a lot of people talking today about it, richard. thanks for coming on "halftime." we'll see you soon so to the extent that the rally needs tech, needs these names to be, again, in the leadership spot, does it or does it not >> i think you do. you do need technology and financials to lead it. i think specifically in microso microsoft, when they announce the earnings, if they don't beat and raise, i think you could see
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the stock pull back because expectations here are so high for the cloud and the other businesses having said that, we still own it i like the stock and would buy it if it dipped because they are in the right places and are going to keep on growing. >> does anybody want to take the other side of that, though, that the rally needs tech hasn't it been born out in the last week or so that even without some of these f.a.n.g. names, assume the top spot on the leaderboard, that we're okay >> the market didn't really suffer when we saw these names coming down. the point moves a lot but the percentage moves weren't all that much, maybe 5%. here's a way i think you've got to look at the market also is that when the market cracked in '08, it's because every economy in the world was going into recession. so now we've got low rates and every economy, at least that we care about in the world, is growing and expanding like we've never seen. >> that's why josh keeps talking
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about that world index. >> right, right. >> which tells that story that you're telling now. >> right what i'm saying is you've got that move on the reverse side. if you can go down 50%, i'm not saying you go up all that much more, but why can't you keep going on that basis. >> but if you have this global growth and get interest rates rising, tech companies have the most cash. they'll benefit with increased rates because the cash is just sitting there. so you've got that option value with some earnings that nobody has built in. >> the other story as it relates to the f.a.n.g. is netflix raising prices on a couple of plans and the stock was up 2% or 4% let's look at netflix and we'll see. >> yeah. >> what about this move? >> we've seen that in the past where they have made this move and everybody is completely getting out of it. i think it seems to me that the investing community seems to be embracing this by saying, we know the money you'll have to spend, we know where the growth is coming from and content will be king for them as they have to spend that money, they'll have to do
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something. this is a bold move and i think the market is embracing it today. >> real world example here i got netflix three or four months ago, okay $11.99 a month when i look at how much my family consumes on netflix versus where i'm paying $400 or whatever the case may be, it's an unbelievable value. >> so they have pricing power. >> but think about the difference between the pricing power. you've paying a couple of hundred bucks for all these channels you never watch, versus you pay $11.99 and you've on it all the time. >> 54% year to date -- 54% gained year to date. >> another reason why the market keeps going. i sold netflix, made a lot of money, sold them in the 170s, right? i think you were there too. >> yep. >> now what's conditioning my behavior is seeing the stock up another 10%, understanding why it's up 10%, this is a great move they still have pricing power,
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so that conditions for other stocks that i own. >> so it's caused you to rethink your own placement within the market based on the stocks you have because of the exact scenario we talk about from the top. >> that's right. >> you think a pullback is coming people were thinking in latter september, and it just doesn't materialize. you look up and now we're going to be talking about dow 23,000 in a short order if things continue the way they have now. >> i'm also talking about companies that still have great fundamentals there that normally taking money off the table, when it's hit your price target, was the right thing to do. violating that discipline is why people keep putting money into those names and recommending microsoft at this high so i don't think that ends soon. >> we're just getting started here here's what else is coming up on "halftime. the state of the big banks wells fargo senior analyst joins us with his top stock picks in
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the space. plus our desk will debate the sector and we're tracking the traders in the halftime quarterly report what our experts learned in q3 we'll highlight a few of their big wins and losses. "the halftime report" with scott wapner and the traders is back in two minutes alerts -- wouldn't you like one from the market when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today.
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welcome back to "halftime. the financials have been the best performing sector since the election on the hopes of new banking regulation or less banking regulation today the senate confirms a new board member, which our next guest says ushers in a new era for the banks. let's welcome bank analyst mike mayo, the senior analyst at wells fargo. so we're talking fed first that's where you want to go? >> sure. >> you think this is a big deal today? >> yeah, i think this marks a transition from a period when regulations have been very tough and that followed a decade of when regulation was too lax and now we're going to a period of regulation that's between the two. the hope is that we have more goldilocks type regulation i define that as not sacrificing one i ota of safety -- >> do you think whatever the next fed is going to be impacts how we should be thinking about the banks in any way
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>> that's not our theme at wells fargo securities at the banks. we think the banking industry is transitioning from a period of value destruction to value creation without any new deregulation so any changes to reduce the complexity, reduce the red tape, to reduce the expenses, the regulatoriy cost is all gravy to our thesis >> you wanted to talk about citi we've made the point before they used to have your picture on the door this guy shows up. send him out the door as fast as you can and maybe call the authorities. now you love the stock it's one of your top picks however, you're here today to -- with a little nuance into where the story goes from here. >> well, it's not one of our top picks, it is the top bank stock selection. we think citigroup stock doubles over five years without any restructuring. however, if citi restructures, we think you could double the stock over three years. >> you're saying they should
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restructure, though? >> we think they should restructure because they generate returns, return on equity, sting in the single digits until citigroup generates return on equity in the double digits we think all options should be on the table that's in contrast to what management said at their annual meeting, which i attended, i went on your show. they said our restructuring is over we don't think citigroup's restructuring should be over. >> why do you keep having a gripe with these people? the story is turned around >> you sound like me, mike >> the story is good >> look -- >> why can't you just sit back and love it? the stock is up like 50% year to date. >> scott, what is your football team do you have a football team? >> redskins. >> washington redskins. >> okay. so if the redskins have good offense and good defense and good special teams and they have a coach that's smart and likeable but still lose the game, then you say you need to do more. >> they're not losing the game
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the stock is up 26% year to date. >> so -- >> maybe it's 55% over a year. >> october 12th, 2007, i was on cnbc when the stock was about $500 we put a sell on the stock the stock has gone from $500 down to $75. until the stock goes over $100 a share, they have not reached their precrisis market cap losing the gain is generating return on equity in the single digits until they get a returning on equity in the double digits, we think all options should be on the table. some of those aumgoptions -- we think they sold some of the wrong things. >> what's the blueprint then of a restructuring? >> well, the blueprint for a restructuring is let's see a list of assets at citigroup tha they should potentially sell whether that's selling a mexican bank or a consumer in asia, that's a possibility we think they made a mistake by
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selling their brokerage business i love financial advisers. i have a financial advisor i have a financial advisor and i'll tell you why. my wife, a doctor, when she says you need a doctor, don't ask me, get your own doctor. when my wife wants a financial advisor, i say don't ask me, call the financial advisers. i love financial advisers, citi never should have gotten rid of that mexican bank is not plugged in to the same type of system as the rest of the company. >> what happens after mike o'neill retires in '18, the chairman >> mandatory retirement for the chairman of citigroup by the end of next year one option is you get a new chairman another option is you promote the ceo to the chairman role i think he increases his chance of getting that chairman job if citi gets the return of double digits if they can get that in 2018 i
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think that puts him in the running for the chairman role. >> so he could be chairman and ceo. >> you need to win the game, get double-digit returns on equity and get your stock price over $100. >> but you're not wavering on corbet as ceo? >> he's done a good job. the biggest structure risk reduction. he's made them much more resilient. even if you have a recession, they should still grow book value. he needs to finish the job. >> have you talked to him personally do they take your call >> citigroup has given me complete access. i have a book where i talk about citigroup shutting me out early part of last decade. it's not a defensive firm like it was for the 15 years, you know, before this time >> i think he's done a phenomenal job when you look at what he's done and how he pared it back from
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the assets they had before he became ceo, he turned all that apart. my question to you is without a wealth management business, should they get rid of the banking and the brokerage business where basically commissions and spreads are going down to nothing? >> let me tell you, i think the strength of citigroup right now is the wholesale franchise the capital markets business at citigroup is back. i mean citigroup literally came back from the dead during the financial crisis now the balance sheet at citigroup is the strongest it's been in a generation so you have more counter parties, more firms wanting to do business with citigroup on the wholesale side. citigroup is still in 98 c countries. my issue comes up with the consumer side. global consumer is a misnomer. consumer banking is a local business at least by country wholesale banking is a global business so citigroup has exited 12 markets around the world in consumer banking
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why stop there. >> so you think that they should take that number lower, when years ago the focus was we're going to continue to expand beyond the u.s. and be the leader you don't want them investing at all outside the u.s. you want that to come down further? >> look, option one is generate returns, return on equity in the double digits, and they get more of a pass. option two if that's not the case, and we actually think they miss their global consumer targets in 2020, then they should pare back more of the global consumer business in asia, in mexico, and think more about the wholesale business for incremental investments. >> so it may sound like a broken record, but we have another record on the dow. the dow is up 100 points we've got, mike, these new highs almost every day, at least on an intraday and some cases a closing level. are the financials in a position to help lead this market higher? >> if you look at the bank stocks since 1999, they haven't done a whole lot we see citigroup going to $140 a
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share in five years. we see 50% upside for our top picks over three years in jpmorgan and bank of america regional banks like suntrust we have a lot of upside here banks have not participated this decade like some of the other sectors. the moment is now for banks. >> we've had a lot of people come on this network and talk to us about selling regional banks. we had that conversation the other day. so you're in direct contrast with that. you believe they're a buy? >> well, relative emphasis is on the largest banks out there. we had an anniversary last friday, and i was the only person on the planet that celebrated the anniversary september 29th, 1994, was national banking -- interstate banking relief that was the first time the largest banks could expand nationally. >> how did we miss that? >> yeah, i don't know. >> did you go get the whale cake >> no, i had that for father's day. this is the first time national
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banks can be national banks without the major regulatory distractions of this decade, without the financial crisis of last decade and without the system integration issues of the 1990s. for the first time in 23 years, national banks can capitalize on being national banks, whether it's technology or brand or distribution pie the way, regulatory relief, less regulatory costs allow those largest banks to invest more in technology. >> mike, it's good having you. >> thanks. >> mike mayo back with us again. citi at the highs of the day, market at the highs of the day, dow with a 100-point gain. up next, pete tracks unusual activity in a transport stock. what the options market is telling him about where it could go next. first, let's check the s&p sectors. financials leading the way today. we're back right after this.
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welcome back stocks are at session highs, new records across the board today you've got the dow, the s&p, the nasdaq, you've got the russell, the transports, the midcaps, the industrials, tech, chips
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pete, energy unusual activity is at a record high. >> unusual activity has been absolutely on fire in that last segment i should mention a hundred plus thousand calls were bought. what am i going to hit you don't worry about that chrw, look at the october calls. 5800 of those were bought today. stock trading around 75.20 this is a name that in the last three months is up 10%, the last month up 4%. it's been on a nice move to the upside transportation, logistics has been on fire along with the last couple of days with the airlines and everything else. keep an eye on these trucks, scott. let's head to sue herera who has the latest headlines for us. >> hi, guys. here's what's happening at this hour vice president pence hosting the first meeting of the revived national space council it's being held in chantilly, virginia he says that america will once
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again lead in space exploration. >> today in the shadow of this history, we pledge to do what america has always done. we will push the boundaries of human knowledge, we will blaze new trails into that great frontier and we will once again astonish the world as we boldly go to meet our future in the skies and in the stars >> speaking of space, two nasa astronauts venturing outside the international space station to do some maintenance and repairs. they're replacing a part on the station's robotic arm. it is the first of three space walks that are planned for october. mitsubishi is recalling some 66,000 vehicles for a second time the recall involves lancer and lancer evolution vehicles from the years 2004 through 2006. they were recalled in 2015 to replace faulty takata airbag inflaters but were replaced with identical parts. that's the news update this hour tyler is here. you're back in the house
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i missed you, ty. >> that's not how to do a recall, when you replace the defective part with more of the same part. >> that's exactly right. >> that would be a textbook no-no. all right, sue, it's great to be back coming up on "power lunch" student loan abuse that's what the attorney general accuses navian of doing. we will talk to the a.g. ahead. and nick mcguire will join us why he thinks decker's outdoors is set to double. and we taste test one of the world's most expensive cups of coffee, right up my alley. scott, back to you >> all right, ty, look forward to that. straight ahead here, amazon reportedly testing its own delivery service to rival the big shoppers we'll trade amazon, fedex and u.p.s. plus western digital, constellation brands and sherwin-williams are all big movers today "halftime" back right after this. miss the blitz, the call of the day or unusual activity with the najarian brothers?
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all right. let's do our trader blitz now. amazon testing its own delivery service to rival fedex and u.p.s. that's according to a report today. fedex, joe, and u.p.s. were both down on this news. they still are and analysts, though, on with us last hour said it's overdone what do you think? >> okay. so i think, first of all, in terms of stock pricing, i like fedex here clearly but i think when we're looking at what amazon is doing right here, we're being too dismissive oh, we started this in india, we're going to test it on the west coast and eventually roll it out i think this is a big thing if you're fedex and u.p.s
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i think this goes a lot further the next couple of years i liked u.p.s.'s comments. if you read fedex's comments, they were interesting, talking about how difficult it would be. amazon has $60 billion go buy fedex. sherwin-williams, new all-time high. a double upgrade, pete you don't see it all that often. >> pretty aggressive you see where they're putting the price target on it and then you go back to the homes what has really been working, home depot, sherwin-williams, tjx and so forth so the home trade continues to work keep an eye on these home builders as well sherwin-williams is going higher. western dig downgraded to hold at deutsche bank. you said you bought more >> i did, i added to it. i'll never fault an analyst for recommending a stock early and then getting out because he sees the fundamentals changing. i don't see them changing and i don't have any confusion about them not getting toshiba you're not creating another
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player in the sector so you've still got tightness in demand. i think it still works and it's very cheap it's about $11 a share next year, so i still think it goes -- maybe next year is the peak i'm not going to be there a year and a half, but i'm there now. >> constellation brands has been a home run they beat again, raised guidance, stock is up 4%. >> double-digit earnings stock 23 times earnings so it's pretty fully priced but you're getting growth at 10%. it's a company you probably want to own for a while. >> the ceo is on tonight with cramer on "mad money." we have a news alert on denone and cam newton. >> i do. basically the danon, the parent company of the yogurt and other products company has dropped cam newton after what they perceive as a sexist response to a reporter basically here's the back story.
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carolina panthers quarterback cam newton came under fire yesterday for comments that he made in response to a reporter from the "charlotte observer" who asked him about one of his teammate's route training. he responded that it was funny to hear a female talk about routes now, at that point he then answered the question, but dannon came out with this statement. we are shocked and disheartened at the behavior and comments of cam newton towards jordan rodrigue it is entirely inconsistent with our commitment to fostering equality and inclusion in every workplace. it is simply not okay to belittle anyone based on gender. we have shared our concerns with cam and we will no longer work with him scott, you are up to date. we'll let you know if anything else develops from this story. back to you. >> okay, sue, thank you so much. we figured there was going to be, pete, some fallout from these comments.
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>> right >> that cam newton made. >> it's a sensitive society we live in. obviously i know that cam if he had an opportunity, he would take back exactly how he was describing her knowledge. >> he had the opportunity and he didn't. >> right mistake. which is a mistake that's something that he should have immediately said, you know what, i apologize for my reaction you know what, that's a great question she was talking about the pass routes of his receivers and how well these guys are doing or not doing. he was dissecting that but her question was valid and he should not have gone there. i'm sure that he probably feels now like that was a huge mistake. there should be an apology at some point in the future. >> we're not in the stone ages anymore. >> cannot do that. copper prices hitting a three-week high and on pace for its best day since late july the futures traders are following that move next on "halftime. for your heart...
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welcome back to d"the halftime report. we are watching copper rise nearly 3% and on base for its best day since july. we're seeing some supply concerns out of china and one of the largest copper producers what else is driving this move at this point? >> well, dr. copper is certainly smiling. i think it's more of a demand component. it's the proxy to global growth. you look at the eurozone, you're
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looking at china pmi expanding 12 months in a row, if you look domestically, the ism manufacturing as well as services are at 12 and 13-year highs respectively so the global growth picture is intact if we see stocks falter off these all-time highs, copper may have a hard time holding this $3 level. >> on a technical level, copper is breaking above its major moving averages. what are the levels that you're watching right now >> yeah, that's right. on the downside it was 2.94 to 2.90 copper held that that's where those moving averages are that you were talking about. on the upside we'll hit a little resistance at 3.05 and 3.06 and nothing after that until 3.15. there's an export license due for renewing and last toime that came up that added to copper prices also. we're joined by marc pouey
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who will reveal why investors shouldn't chase this rally plus barry james will break down trump's tax plan and its market impact a very busy futures now coming up at the top of the hour. coming up next here, the halftime quarterly report. we are tracking the traders, good, bad, maybe ugly from q3. but before the break, let's check the dow 30 dow is up 94 and there you go, it's goldman, microsoft and jpm. apple as well. leading the way toy.da "halftime report" back in two minutes. well, it's earnings season once again. >>yeah. lot of tech companies are reporting today. and, how's it looking? >>i don't know. there's so many opinions out there, it's hard to make sense of it all. well, victor, do you have something for him? >>check this out. td ameritrade aggregates thousands of earnings estimates into a single data point. that way you can keep your eyes on the big picture. >>huh. feel better? >>much better.
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yeah, me too. wow, you really did a number on this thing. >>sorry about that. that's alright. i got a box of 'em. thousands of opinions. one estimate. the earnings tool from td ameritrade.
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without pg&e's assistance, without their training our collaboration with pg&e is centered around public safety. we could not do our mission to keep our community safe. anytime we are responding to a structure fire, one of the first calls you make is for pg&e for gas and electric safety. it's my job to make sure that they have the training that they need to make the scene safe for themselves and for the public. it's hands-on training actually turning valves, turning systems off,
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looking at different wire systems all that training is crucial to keeping our community safe and our firefighters safe. together, we're building a better california. all right, welcome back to "the halftime report." we are taking a look at some of the traders most memorable calls from q3. the good, the bad and the ugly first, the good ones >> love this name, it's one of the best in the space. we talk about under armour and nike all the time. adidas we don't talk as much about. this is a brand that has a global presence. >> i mike micron it's been flat the earnings were okay. >> interactive ac had great earnings this is about to break out this is a company you want to hold for a long time. >> all righty then micron is up 38% since that call >> it's going to keep going.
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last week i bought some of the calls or maybe it was monday this week. the november 44 calls. it looks like it wants to keep going. it was down a little bit yesterday and you've got to buy these on the dips. fundamentals are s >> we talked about global growth but i even look at growth from north america as they have been taking share away from nike. does nike lose they have to grow internationally. but adidas is on fire. i still think it has upside. >> up 18% for sarat? >> they own match and tinder a lot of tail wind here. >> range resources, joe, up 15%. >> yes staying with half the position sold half the other day around 20.5 like it. >> as we mentioned, not every pick worked out, at least not yet.
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>> pricing power, all but lost impact of uber, don't touch it >> i like the airlines i like this airline. i think it is a great group. i'm still in american and delta and i'm staying there. >> ten-year highs. keep an eye on this. i think it is ready to break out. >> things happen with bryson stock reflecting true value there. a turn-around story and a great management team. >> all right i've said good, bad and ugly and some airlines have been just ugly united down 24% and delta down 12 each. >> i apologize to producers who had to work hard to find things that didn't work in my portfolio. i own american and delta -- >> contrary to what they told me >> i've sense added to delta and american and united around 59 level. they've broken out incredibly. and i think they will keep going. >> to deflect away from other
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banks. >> thank you thank you. >> pete? >> church and dwight down 8% >> i like that it is on the upside i expected it to break out and it didn't. i still like the name. the brand. >> sarat >> exiting swim and apparel. they lack in the last quarter. i hold it and keep on buying it. >> give me something on the airlines that didn't work. including steve, that they he would? >> united, delta, two of the top largest holdings >> what happened >> they add great run last year and people just don't believe they he can keep the pricing up. but you're still not seeing excess pressure in terms of their pricing and you're not seeing new capacity come on. american just had their analyst day last week. they talked about how they will keep on increasing earnings and paying down debt delta has investment grade and
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continuing paying down debt. i think these things are undermarket valuations and you will do well the next couple hours. >> they got hit from competitor pricing. number one number two, some capacity did creep in but it is still far lower than it's ever been. >> you have to still grow he but not growing like they used to and investors just can't get their arms around it >> okay. >> pete might have something to say. keep going >> it's all good >> let's move to -- not so fast there, pal [ laughter ] >> it's true -- >> [ laughter >> joe, you said stay way from hertz. >> i did >> listen w, bailed out by the hurricanes clearly i was wrong on that one. up 30% $2 million market cap. still problems fundamentally >> grasso is all over these
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things >> maybe i'll find him after the show >> he is like around the corner. >> he has avis and hertz >> he's at the rental counter right now. >> costco closing earnings after we close that stock coming up plus your final trades of course, coming up next (honking) (beeping) we're on to you, diabetes. time's up, insufficient prenatal care. and administrative paperwork, your days of drowning people are numbered. same goes for you, budget overruns. and rising costs, wipe that smile off your face. we're coming for you too. at optum, we're partnering across the health system to tackle its biggest challenges.
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businesses of prudential. welcome back we are looking at shares of
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regeneron. you can see a sizeable bump, open 3%. they've gotten approval for their cholesterol drug i believe it was a reversal that now allows them to sell it, regenero no regeneron is up 3% we will follow that the rest of the day. dow is up. new records across the board today. let's talk about how things could continue costco is higher today, joe, after reported earnings after the bell what should we he expect some. >> $2 eps is basically $41 billion. e-commerce investment will be a focus. i listened to jim this morning i agree with jim i've been long on the way up and on the way down after whole foods comments i believe with what jim is saying here. you can see good results and if you can see the stock go down on profit taking but i am in this for the long-term. i believe in the company
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i believe in what they are doing in immerse ae-commerce and food. if they go down, i will buy more >> yum china >> yes, independent from yum they spin it off management will have to tell us their story and the pulse of the chinese eno only aeconomy and i watch. >> incredible year 53% from year to date. >> good way to play china and the growth i worry about competition from other companies that could affect kfc and pizza hut >> let's do final trades joe, what got? >> going back to microsoft which most of us on this decks are long i like other names, sae and red hat. >> okay. pete >> financials will remain strong and the paper that comes in there each and everyday is absolutely unbelievable. i'm going back with citigroup. i think mike mayo is great
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i think they are getting to a hundred in a short amount of time >> baba, starting on october 18, a five-year meeting, going to reinforce his power there and go for a record third term. so i think it is positive. he has been good for the country and economy. so i play it that way. >> all right sarat? >> i think you look at citibank too. great global exposure. keep watching that stock and good to the upside >> a minute left what gets in the way of this rally? >> earnings. >> acknowledgement >> are you worried about earnings or do you think it confirms where we are and where we can go? >> i'm not this seasoned i'm not nervous. i'm watching companies that i'm involved in. i'm comfortable with what they will do in the quarter if you see a massive disappointment -- >> the bar is high though? >> bar is high if you see massive disappointment earnings then you have initiative. i don't think it will happen, but something to watch for >> the bar is high where the market is and where
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things are priced. >> one of the thing that could happen, i'm not saying it is, but to watch for is earnings and companies talking about higher input and you could talk interest rates a very fast way to get this market rally to stop >> sarat, thank you. thanks for watching. that does it for us. "power lunch" begins right now >> riding the record washington seems to be making headway on tax reform. from washington it wall street, we've got you covered. developing story at this hour. major lawsuit against the largest suedant loan servicing company. accused of widespread abuse. stock tanking at this hour all of the details for investors and consumers straight ahead. can't afford the deposit on your home? more and more people are asking complete strangers for help. we will explain. "power lunch" starts right now ♪


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