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tv   Fast Money Halftime Report  CNBC  May 30, 2019 12:00pm-1:00pm EDT

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>> yes facebook in particular will be an interesting one to watch not just today but ongoing leslie mentioned it up 39% year to date. it's about flat over the past 12 months at the same time. we will see which way that one goes. >> ub he let's get to the judge at the half. how much pain can be ahead for the most-loved stock in the market it's 12:00 noon and it's "the halftime report." >> top analyst cuts her price target on apple. if the fall gets worse for this stock, it could have a big impact on the rest of the market plus, why to follow liz ann sanders warning about cutting the sharpening of the recession. but is opportunity knocking for growth about a third of the stocks in one key growth index are now in bear market inventory.
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are these ripe for buyers not afraid of risk and goldman sachs said it's time to buy this other key bank "the halftime report" with scott wapner starts right now. welcome. good to have you with us on this thursday our investment committee today, our brothers najarian are here we begin with shares of apple higher today, losing steam though despite morgan stanley's katie huberty dropping her bid, it is still a caution from pete, that's why i'm turning to you. katie, your favorite analyst, she said pete, i'm worried. >> she is, for all of the right reasons. >> i will quote right from the note this is good she's talking about demand in china, central issue front and center iphone demand likely persisted through april where apple gained
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year on year however the rhetoric and actions taken by the u.s. and chinese authorities make it less likely this trend will continue into may/june. is that a problem? >> definitely is a problem we're talking about the area we always talk when when we talk about growth and how they're doing, and this is the only geographical part of apple's world that they aren't winning in and huawei actually has control. or very, very close in other words. but they own every other geography there is out there, scott, against huawei at least that part you have to take into account. wearables as well as services, that's the difference right now in terms of the structural difference now, five years later is apple is no longer just the phone company they once were now they were much more and getting into ai and all sorts of other areas as well in terms of the verticals that they're trying to create no doubt about it and katy points out, look, this could be a 23% negative push in terms of the earnings per share and she
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dropped it down. >> that was may soth this is the cautious double down if want to put it that way, right? >> that's a worse case scenario, by the way >> you know where i will go with that, she said it's the worst case scenario may soth but you know what else, they view it as the more likely scenario even worst case scenario, what we view as the more likely scenario. >> there's no doubt you should be concerned about this, no doubt. when we talk about the trade wars, we really focused primarily on the intellectual property companies and look at somebody like apple directly, this is where they're trying to grow this is a huge market. they have a great opportunity there. they made some mistakes and stumbled but now all of a sudden it looks like they found their footing and now a trade war. how long does this persist we have no idea how long the time frame for this goes, so this is a headwind, absolute headache for apple i'm sure tim cook would say this
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will be an issue going forward. >> issue right there for aapl. stuck at $177. well, it's better than it is now. it pulled back a little bit too. kind of surprising it hasn't been down lately. >> let's take it from the perspective of which way the flows are going in the stock if you think about the quarter coming in ahead very strong momentum, it had earnings that we got in april. in that earnings there was confidence from the ceo that things were okay at least in china. there has been a dramatic 180 in terms of sentiment, and i would imagine in terms of the flow so -- >> the huawei thing is game-changer potentially. >> 100%. >> when that got ratcheted up, then had you to start considering retaliatory measures. >> you're presenting the fundamental argument which is fair, what i'm trying to get you to understand is how is the institutional manager thinking about this equity and what's the positioning? is there an opportunity with the stock sitting at $177 and listening to pete and understanding that fundamentally, yes, this company
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has the opportunity if there's a resolution for the trade dispute to have a significant appreciation and see the fundamental shine. >> yes, changes everything. >> but the problem is institutionally you saw so many fundamental flows from apple in april, you will not see anyone stepping out and taking the risk without having that 100% certainty that the coast is clear here so i think when you're looking at the balance of sellers and buyers on the institutional side, i would be inclined to say for the balance ofquarter you will see more selling pressure than you will see a willingness to step in and buy it. >> if huberty is right and they start to -- they start to lose the momentum they feel like they maybe got back in china, this is not a $200 stock, steve, with iphones going off a cliff in china, is it >> definitely not. >> regardless of services and wearables and all of those things that have a nice amount of growth. >> it's not a $200 stock with
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the iphone losing a whole bunch of air in china. >> no, it's not. you also don't know what the after effect will be whether there's an increase in nationalism and protesting against u.s. products in china as well. where the citizens there say you know what, they came after us, i don't want to own apple product. you don't have the embedded ecosystem you have here. >> doc said yesterday it won't happen. >> we will see i'm surprised, you're surprised katy's report didn't get this down it's a little late the reason why the stock is down 15% is because of china. and i'm not so sure china's momentum for apple was actually momentum we had a statement by tim cook we had a little uptick in sales but that's not enough to move the needle in terms of the rest of the world and atrophying sales of apple phones, which is still the most profitable part, and slowing in the services. look, it all comes down to the same question every stock comes down to and the market comes
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down to, is china going to be able to have a deal with the u.s. or not? if it does, stock goes back up over 200 >> the bad news in the stock, that's why it came down from $200 to $177 give up $25. >> you don't think it goes lower from here? >> no, i still think the market is a little bit complacent about a deal so if there is no deal, if there is no positive news coming out of g20 at the end of june, then yes, you will go lower. >> but you wouldn't buy it until you knew there was a deal. >> but here's the question, do i think there will be more pressure on that than any other stock that really applies its trade and depends on china no. >> the worst case scenario as katy huberty said on may 10th, the more likely scenario is 20% decline in earnings, then the stock will go down more than it is from here, no you think that's factored in the drop in earnings is factored
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in >> i think some drop in earnings is factored in but it depends, as i said, there complacency of a deal the question of timing and how you can forecast that into the earnings what she's saying is no deal means 23% lower. i think it can even go lower than that. >> she did not take it from overweight she lowered her target from $240, i believe, to $231 we're trading now at about $178 so i'm with steve. our friend mark fischer always says bad news, not a negative reaction, in fact a good reaction that tells you where you are to your question did we exhaust the sellers? perhaps not yet. i was still looking for $175 or lower for this one, scott, which is my biggest holding. but we just hit a wall and i don't know if that wall is apple with its buyback sitting there with their hand under the market on these sell-offs i don't know if it's that but margins, when you look at the
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900 million phones out there now, 900 million units, whether apple doesn't sell quite as many new units, fresh units in china or not, the services which grew dramatically and we got the first look ever in january at the numbers, 63% margin. that's the $900 million you got already. they're captive. that group is not going to any google or android platform so that's going to continue to be revenue in to apple at a growing pace, not a lesser pace. >> yeah, april sl just goi-- ape is just going negative as we have this conversation what i have in front of me, most recent ones cut to $174 at hsbc. a couple reiteration of neutral calls. reiteration of reduce at hsbc on may 20th so the street has cooled, a good part of the street cooled where the stocks will go in the near
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term. >> i agree in that i think the price is discounted here the one part of what we saw with the huawei issue and the qualcomm is china actually uses apple towards one of the things they want to do in this trade war, then i think the stock goes down a lot more. then you're basically saying to one of the best companies in the world, we don't want you here. that after effect will take a long time for that stock to recover. so i think we have seen early sellers out. people there are long-term investors. >> but.view the view is the stn do down more. >> it could. but there's more of a chance it will be higher so don't sell now. >> the other perspective to bring in the conversation, i mentioned price targets getting cut and i know there's a lot of headwind that appears to be out there, bank of america today takes the other side they say there's not going to be retaliation against apple.
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cramer brought up the point a couple weeks ago too, like you're going to cut off your nose to spite your face if you're the chinese what are you going to retaliate? what about the manufacturing jobs in china related to the iphone and components and everything else? are you going to kill those too? kill the industry around the iphone despite the iphone itself >> not kill it but you can see weakening of that. when you look at the stock now at $177, i was asked by a producer today, would you buy right here no i already own it why would i want to buy it again. if it starts to get down to the $150, $160 level, then i could. >> you think it could? >> absolutely. if this is a prolonged war, squirmish, whatever you want to call this, yes the further this goes out and the longer this is extended, i think that definitely will hurt them. >> is there a possibility apple could be weaponized in this trade dispute? that's the whole question of the discussion unequivocally
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you're just using a different word and a good one. >> the answer is yes that is why you want to buy the stock, i want to buy the stock, i want to get back into it but you're waiting and pausing. >> it's one of the investment strategies. >> it's one of the best buy rights i own right now i'm getting calls every month against an apple position for many years and it continues to be one of the best i have ever seen including throw in netflix and somewhat other volatile names moving all around for a lot of different reasons. when you can get the premium, scott, can you get against some of these great companies, you can do that and suddenly your price-to-entry point continues to lower, lower, lower, lower. >> pete, let me ask you a question, if they come out in the quarter and i don't know what the benchmark will be because they never said it, but for their new news plus services and they don't give you any more clarity over the top on video, does that have any impact on the stock? >> if they don't give you more
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info, is that what you're saying, more transparency? >> i'm saying if it's disappointing. i don't know what the benchmark is, subscribers. >> that's the problem, we don't have a benchmark. >> the other issue around all of the fundamentals we discussed for the last ten minutes, there's the technical issue too on the shares that josh brown spoke about a couple days ago on the show he said it was one of the two most important starts in the market, between apple and amazon listen to what josh told us a couple of days ago that the downtrend apple appears to be in. >> apple now has a 200-day sloping downward last time we saw that was more than three years ago that's not a good sign this is a stock that got decimated in december, down 23% from its peak, bottomed, staged a furious comeback but did not make a new all-time high and is now -- hold on -- is now down 17% in may >> so you want to pile that on top of what is already pi
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potentially a curious or worrisome china trade war. >> i don't care about that to be hon effort it's one stock we've seen before when apple underperformed that the market has done quite well in it. the margaret is way past looking at f.a.n.g., any part of f.a.n.g., as a judgment. >> it's a problem overall for the market, isn't it, if apple isin this downtrend? >> no. >> you're telling me the market's going to go up if apple continues to go down >> no. >> i'll take that bet any day of the week. >> and i'll give it to you if apple is going down because of china, then it's a problem because everybody's got that problem. if apple's going down because unit sales are lower, it's not going to impact the rest of the market. >> unit sales are going to be going lower because of china which way do you want it >> china, i said, is affected the same way every other stock's exposure is affected. >> i'm saying right now given the state of the market, the fact where the stock is, issue
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that's have driven it lower are all about china. >> i have had conversations all day long and i can tell you not one investor i respect, and not one investor i don't respect, ever said apple's going down, i got to sell the market i'm worried about the market. >> did i say that? i never said to sell the market. >> you said it's an important indicate irof t indicator of the market and i'm telling you it's no indicator of the market. >> enjoy the island you're living on. >> pretty good island. nice houses. >> whatever. bet get a nice boat. how about f.a.n.g. in general? f.a.n.g. continues to go down, apple, irrelevant to the overall mark -- >> hold on i'm not saying it's irrelevant. >> you're trying to be too nuanced. you're trying to parse like one word of this, that or the other. >> i'm not trying to be too nuanced. >> apple's been down more time when apple's been down lately the market's been down. if apple continues to go down,
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the stock market will rip back to new highs according to steve weiss. >> xpo has been down every day xpo must be rile indicator of the market. >> i will say to answer your question, if f.a.n.g. starts to struggle more than they already have, we have seen some of this in the pullback in multiple f.a.n.g. names and throw in the apples of the world, but what hung in solid is microsoft and ciscos there are base strength there as well, scott. i think that's a little helpful to see, there are certain names getting pushed down and those are the names probably every has a piece of they're trying to take a little bit of the risk off and we're seeing more and more hedge funds, i think, and i have been talking to a lot of guys -- >> uh-oh, you haven't been talking to as many people as steve weiss has. >> i have been been having different conversations. >> you went into the rose bush. >> i don't hear anybody disagreeing with my point. >> you went into the rose bush. >> talking to some of the hedge fund guys that i'm very well
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connected with have said some of these, not only is there a movement towards family offices but i think there's struggling going on there so they're selling. >> tread lightly. >> i'm looking at apple as an indicator. >> nobody said it was an indicator of the market. >> the one thing you did say that is correct, the earnings and the earnings call from apple, it was about one sentence, things are okay. tim cook saying things are okay in china that's all the market wants to hear everyone got back into apple when are you going to gain that understanding once again > july you're asking about concern for the market i keep talking about it. nvidia, america's most favorite stock, the semi that everyone loved that was going to the moon, $290 in okts and now below $140 what does that tell us about the
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market it's telling us the ability and desire to go after high-beta names to achieve alpha is not there. that is something i would be watching if the market feels comfortable again, you're going to see money going into nvidia and nvidia's going up nvidia continues to go down every day. >> scott in december on the 24th when we hit that capitulation bottom, apple never bounced there. it did not it was $146. two weeks later it was still $146 because mr. cook kept the pressure on when he sent that letter out that we cited over and over again as far as this is a warning sound. he's going out there and he's saying this. the market meanwhile rallied 10%. so to your question, which is a good one, can the market rally without apple? it's done it multiple times. and the december 24th through january 8th is a great time to look at that chart and say, s&p 500, biggest measure of u.s. performance that there is, went up 9 1/2% over those two weeks and yet apple was $146 the whole
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time didn't break higher than that until after cook basically said hey, this could be just horrible and then the market went -- and jumped to the upside that was the bottom for apple in the january 7th or thereabouts area we did just fine without apple. >> i'm saying, if apple is being driven down now by fears about an escalating trade war with china -- >> it's already been driven down my point is it's already been driven down to here. so the average price on the street right now according to 12-month out is $174 we said it already now you've got $142 on the bottom, $233 or so on the top. we're right in the middle. we gave up $214 down to $178 after the last earnings call where do we have to go >> if apple continues to go down, sa rat's knocked his mic
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off. caught in the middle of you guys if apple continues to go down and tries to test $150 >> if that happens -- >> you're telling me the market will be awesome in that situation? >> if that happens -- >> he said it's fine it will be fine. >> he said $35, $40 decline for apple pricing in that it might be a long slog with china. that's what i think. >> you need negative news on the china front in order for apple to go meaningfully lower i think is what you're saying. >> true. >> if that happens, the market will be just fine. >> the market's going down but the margaret is not -- >> i didn't say that i said if apple continues to go down, the market is going to continue to go down. it will just happen. we can visit that later. people are tired of that conversation now especially me. >> i think you got my point ten minutes ago. >> i have to look at you the next 40 minutes. imagine how i feel hold at puberty. we have breaking news from
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the fed. let's get to steve liesman. >> yes, scott, thank you the vice chairman of the federal reserve open market committee -- record, pardon me, said the economy is in a very good place but also tells me what his idea would be for cutting rates there are two parts, one, a persistent shortfall i sophistication below the 2% target and second, material downside risk to the u.s. outlook from either the global economy or financial development. maybe there's a subtle pushing back there on how much the market has priced in a rate cut. he's saying, look, there's two criteria here and maybe there's a long way to go, though he doesn't say that on the other side there's a high bar for rate hike. fiscal policy continues to support growth for 2019 and wages do not signal cost push pressures, recent rise in wages. inflation remains muted. the prime age participation, participation rate of people 25 to 54 may still have more room
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to run all of that means potential output could be higher than current estimates. add to that productivity growth may have picked up all of this tells me you have a fed official who wants to see the economy run, doesn't want to clamp down on higher growth because he said the supply side of the economy is faster than expected in 2018 and first quarter of 2019. maybe a bit more hawkish on the cut but very dovish on the idea of when the fed might increase interest rates, scott. >> interesting stuff everything the fed says these days, steve, just given what the market has done and where interest rates have gone, you know, nice little bounce today but so many concerns out there now all of a sudden the drumbeat, fed's got to cut dr. j saying they should cut twice. >> when you get out on the limb, it gets thin so people are interested in any little comment from any fed official. there's a talk of whether or not bond yields hit the lows and there's more resistance now for
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them to go lower from here i think the markets are very interested to what the fed has to say i will point out, no mention of trade by richard collar idia clarida. >> wait until his next speech. don't worry, it will be in there. steve, thanks. stocks in the green as you know and they've been teetering a little bit bond yields bouncing from their lowest level in some 20 months over concerns about slowing growth those concerns remain front and center let's welcome in liz ann saunders, schaub chief investment stratus, along with tom lee. great to see you what do you make of the market this week, as low as bond yields got and stocks, trying to get a bounce today, but it's not much of one. >> yeah, we're in another one with of these pullback phases, 5% at the worse, whether it turns into a full fledge correction, i don't have any greater sense of that than
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anybody else but i think it reflects obviously some of the escalation in trade and i think more meat being put on the bones of the impact this is going to have, companies actually coming out and talking about whether they're likely to absorb is in the profit margins or past costs on to the consumers. if so, are they going to do it specifically to the tariffed goods or spread those cost increases out over other goods so it hasn't had a direct impact on the economy other than through the confidence channels but i think especially if the additional tariffs on the 325 go in and goods to the consumer, this will have an impact that's more than esoteric it's something the average person on main street will see and feel. >> tom, a lot of worry about yields 221 yesterday, 220 lowest in 20 months. little bounce today. a lot of talk about the yield curve. you say we shouldn't be as worried about the yield curve as maybe some are >> well, yield curve versions are bad because it does tell us
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something is wrong about how people view long-term lending. but one of the key things to point out is we had a ten-year, three month inversion take place but it's because of a risk off people are buying a ten-year, causing that rate to fall. >> rather than some, you know, major deterioration in economic activity >> correct if you look at the seven times the ten three inverted since 1968, first conversion, six of the seven times it's because the fed raised the short-term rate and that was an attempt to slow an overheated economy. 1998 is the only time we saw the ten-year fall below the three month and that was because it was in the middle of the russian debt crisis and long-term capital. those risk off inversions actually grapevined up and you had close to 50% rally over the next ten months. >> liz ann, can you see it that way? i'm wondering if bond yields
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keep falling, if stocks will get risk if people do view it as a buying event or big risk off event? >> to tom's point there are similarities between last year and 1998 with the collapse of ltcm and crisis and the fed cut interest rates. you almost had a near bear market where it was down 19.8% if you're around you had your bear market and had it more severely across other sectors. whether that's it and we're going to mirror 1999 into 2000 and hold off a recession, time will tell. but i agree the inversion does tell you something the problem with inversions, regardless of how it happens, it doesn't tell you how long it is between now and the next recession. doesn't tell you the length of the severity of the recession and it doesn't tell you anything about how the market will behave
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from the reversion to the start of the recession or thereafter you only have about seven modern day experiences and even though you had most of them ultimately lead to a recession, the variability around how the margaret performed and length of time is wide enough that anybody that expresses their views based on averages, i think that's faulty reasoning. >> let's do this let's take a quick break and we will come back and continue the conversation here's what else is coming up on "the halftime report." next up -- the bank goldman sachs says buy the "call of the day" is next. jon and pete najarian both have unusual options activity in the options market before the break, our data partners at ken show on what happens after the tlt treasury etf picks up more than 5% in a month, which has now happened 25 times in five years. the data shows tech, consumer discretionary and industrials all outpaced the s&p over the next month
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for more go to but you have the power to do so much more. let's not just develop apps, let's develop apps that help save lives. let's make open source software the standard. let's create new plastics that are highly recyclable. it's going to take input from everyone. so let's do it all, together. ♪ ♪ let's expect more from technology. let's put smart to work. ♪ ♪ your daily dashboard from fidelity. a visual snapshot of your investments. key portfolio events. all in one place. because when it's decision time... you need decision tech. only from fidelity.
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we like drip coffee, layovers- -and waiting on hold. what we don't like is relying on fancy technology for help. snail mail! we were invited to a y2k party... uh, didn't that happen, like, 20 years ago? oh, look, karolyn, we've got a mathematician on our hands! check it out! now you can schedule a callback or reschedule an appointment, even on nights and weekends. today's xfinity service. simple. easy. awesome. i'd rather not. welcome back, everyone i'm sue herera here's what's happening this hour president trump is speaking to
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reporters on the white house lawn before departing to colorado to deliver the commencement address at the air force academy graduation he denied having anything to do with the uss john mccain being kept out of his sight in japan. >> i don't know what happened. i wasn't involved. i would not have done that i was very angry with john mccain because he killed health care i was not a big fan of john mccain in any way, shape or form i didn't know anything about it. i would never have done that the sexual assault trial against a former michigan state dean, larry nassar's former boss, is now under way lanry stramible is charged with sexual misconduct against a formal student he has denied all allegations. target is recalling all 90,000 heyday lightning usb charging cable due to shock and fire hazards they were sold nationwide june 2018 to january 2019 for about
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$15 and are used in part to charge cell phones so check to see if you have one of those in your drawer. that's the news update this hour i will send it back to you, scott. >> sue, thank you. tom lee is at the desk liz ann is with us so, tom, what's your target at the end of the year? >> s&p 3,100. >> it gets there why trade deal >> i think it's critical we get some resolution of a trade deal. someone needs to blink and i think businesses will start to increase the pressure for that but one of the things investors shouldn't get too negative on is, one, the u.s. is a safe haven to get large liquid markets and the u.s. is healthy, even business downturn has been mild so far. so i think resilient consumer, a lot of dry powder, u.s. is a safe haven. >> how about that, liz ann >> we don't do year-end targets. i don't know where the market will close today at 4:00 let alone the end of december and
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that goes all the way to chuck not believing that's really a value to an investor. >> but if i was to tell you the s&p has a good amount of room to run here between now and the end of the year based on the reasons tom just laid out, hey, consumers is really strong this is the best house in an otherwise cautious neighborhood, uncertain neighborhood does that make sense to you? >> well, i would question the consumer strength especially the additional tariffs if they kick in you look at q 1 gdp and revision to 2.1 was a little bit better than expected but the demand number was relatively weak, the boost from inventory and net trade, both are likely to falter i think trade is a big factor here because i think we were starting to lose some of the oomph from the consumer and looking to see cap x kind of pick up the next leg of the cycle
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it's hard to envision a scenario where you see animal spirit kick in confidence that allows for the next cap x led part of the cycle. we can just hang around here i don't see a big risk of major deterioration. i just don't see what the catalyst is to accelerate us back to a higher plain of economic growth. >> can you get to, tom, $3,0100 without a trade deal >> no. if there's no blinking and no progress, risk off will be what's at play for instance, consumer finance stocks are really strong they're probably one of the strongest groups and they should be rolling over if we're worried about a huge deterioration coming. >> yes good stuff thank you. liz ann, thank you, great to talk to you as well. liz ann sonders on the phone there. we covered the market, tech and decline, the market more broadly, wonder if we have
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gotten oversold. do you guys think we have, by the way? have we oversold time to buy stock? >> i think it's time to look at companies that are beaten down. >> there are a lot of companies beaten down. >> there are a lot as you mentioned for valuation purpose, even if they stay where they are, companies that have been sold-out, i will give you a couple examples, xpo logistics off 50% of its high. that company is front center in trade but very well-run business and is capital positive paying down debt. another one is lowe's. lowe's last week announced earnings, sales up the highest in a quarter, but they're spending money, housing is still strong, stock is up 20%. valuation matters, good balance sheets, good management teams. these are teams if you want to make money the next couple of years, you want to own them. >> it's interesting you just sold xpo. >> i did. >> cere@make the case for it. >> they just took another billion dollars worth of debt
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through buyback while the plan is to pay down debt. they had been and moved the track. >> they moved the strategy from acquisition. >> right i sold it because the freight numbers were deteriorating you are seeing spot prices drop and over capacity. i would love to go back to it but that's not going up until the trade deal the stocks i'm looking at are blackstone and kkr blackstone is a huge yield, 5% the stocks have not come down enough they're down about 10% from the highs when they announced the transition to c corp. but it's a good hij because if equities get cheaper, they still have a lot of dry powder and they will go out and make a lot of acquisitions i think when they change their structure to c corp., they're going to want to come on with a bang, which means they're going to really aggressively push numbers. we saw blackstone is selling real estate down. >> joe, you a buyer of anything? >> i'm certainly watching now.
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i think what's happened is you seen a significant sell-off in momentum overall we had the conversation about fundamental quality momentum last week. >> like a third of vanguard's growth fund is in like bear market territory, to your point. >> yes i think that's really what is so significant, the deep sell-off in momentum. do you go right back to momentum no, i don't think you do i'm watching apple as an indicator whether that would work or not. >> i wouldn't watch it as an indicator. >> i like companies that exhibit quality fundamentals and you can marry them with strong technical momentum some of the names that i own that have pulled back, i would love to be able to add to american express, microsoft, mcdonald's, honeywell, quality, quality companies today. i'm still waiting. i think that's the right play. will you get the china pmi tomorrow i think that's incredibly important. i'm still confused as to why a german ten year is approaching
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eight negative basis points, what the heck is that signaling? investment bonds, again, 52-week highs. so i think the right approach is to be sitting back very thoughtful and be very patient. >> pete, you buying anything today? >> today -- over the last couple of days, joe talked about it. >> the market pullback. >> joe talked about microsoft, i love that name i put on a call spread on top of the stock i already own. quite a few others tjx is another example from just yesterday. yesterday too canada goose got absolutely slaughtered it's been a name i liked their guidance, steve was trying to be funny about something but their guidance was very, very conservative. >> allegedly, yes. >> guidance was 20% growth going to 2020. 2019 it was 40%. so if people are looking to 25%, 27% and came in 20%, the conservative side hit that stock immensely yesterday. i think overdone when you look at the fact their margins right noud or 62 versus
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58 what people were looking for, their margin business is good. their geographically i think they're well dispersed right now with very little exposure but it's growing in terms of the asian markets. they're doing things right and it's gotten too cheap and the growth is still there. i think that conservative guidance hurt them that's why the stock was down 25-plus percent. >> so you're buying? >> i absolutely bought it yesterday and i'm selling upside calls. i told you that at the start of the whole thing! i told you i bought it. >> i responded to carl quintanilla this morning talking about housing starts and various things in the housing sector, i said my favorite sector, you look at horton, la nar, these are killing it year to date, 20, 27 and 30% respectively. those are fantastic numbers for a multi year return, let alone just the first five months of the year
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yes, housing i add if they dip at all, i have been adding because i think rates will be going lower, to joe's point the german ten-year being negative almost 20 basis points is another reason that rates are going to be lower for longer. >> good stuff. options bulls are bidding on one of this year's high-flying chip stocks and thinking it's not done quite yet jon and pete have that trade coming up and unusual activity first, your s&p sector check positive by arquter percent led by discretionary "the halftime report" is back after this what if other kinds of plants captured it too? if these industrial plants had technology that captured carbon like trees we could help lower emissions. carbon capture is important technology - and experts agree. that's why we're working on ways to improve it. so plants... can be a little more... like plants. ♪
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. we're back despite the recent downturn, and it's been a big one, semis are 12i8 having a strong 2019 and amd standing out as a big winner traders are hoping there's more room to go because they're placing their bets, right, pete? >> yes that was one of the things so interesting yesterday, how semis held up so good considering what the market was doing yesterday take a look at the chart since april. i think if people were just watching tv all the time, they would say the semis are absolutely getting slaughtered apparently not look at the chart, been hanging in there amd after a pretty significant move when you see
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from the start of the year they're going after calls expiring on the 14th, 29 strike calls, you see that 8,500 were bought up to 29 cents. when i see something like this, i have to jump on it first, it's inexpensive. second of all, it's short-term out. i like shorter term better than longer term because we're not seeing big long-term activity if they had a projection going forward. right now i love these calls short term, i think if it bfts through 29, it will be in the 30s rapidly. >> what do you got >> snap. this one have been talking to legends at music companies about getting a deal done. whether that's the reason or not, someone comes in buying snap calls in a big way today. not 5,000, not 10,000, they bought almost 18,000 of these. that's almost 1.8 million share equivalent the stock is in the 11s. i love that because it's not making a huge move for these to
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double or even triple. i bought these calls and since they're june, i will be in them two to three weeks. >> good stuff. let's start the "call of the day" as you saunter back to the desk citi, buy it, the latest call. somebody already owns it weiss, you used to own it. they say buy now you agree? price target $77 21% from here. >> i don't agree what he's focused on and it's a good report is they will get a better return on their equity than what the street's looking for. but it's also highly contingent again on trade flows let's face it, they're the most international global bank in the u.s. i think you can wait on it i don't think it's expensive to wait on. and i sold at a good price and happy to wait on the sidelines i'm happier with kkr. >> i bought cition may 14th. i disagree
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expose ush in china is limited for citi if the supply chain gets disrupted, they're well positioned outside of china to benefit from that. but i really bought it, i read the note and the note is about higher rates, higher growth. that's not why you buy citi. it's about digital transformation it's why i own jpmorgan and goldman sachs. citigroup will have $500 million to $600 million in cost savings because of digital savings the cost of digital in q 1 were $1 billion the entire year 2018, they didn't reach that number there's a transformation on the digit aside. that's why i like hem. >> true it's digital selling and cheapest bank out there, but i don't think you change that. if i want too own a bank i would rather own jpmorgan. >> we will leave that there. your questions coming in on fied yu, luluemon you have time to reach out to us
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halftime report. we are keeping a close eye on the shares of occidental petroleum and an darkia petroleum because anadarko there can be a wrinkle in the proposed acquisition activist investor carl icahn and companies he controlled have filed a lawsuit, built a $1.6 billion position in occidental they're looking for at least an agreement here or a lawsuit because they say the deal is fundamentally misguided and hugely overpriced, looking possibly for board changes and documents with regard to the sale of the company. so we're keeping a close eye on both of those stocks now let's send it over to seema mody with the features now team. >> keeping a close eye on copper, a key china proxy, trading at its lowest level since jan arpd and erasing nearly all of its gains for the year as we await china manufacturing data tonight which
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could show how much tariffs are hurting its economy. let's bring in our traders, scott nations and jim urio scott, let's start with you. can copper find any footing before the next g20 summit where we're expecting some type prof gres on trade? >> i would not expect it good gdp number didn't help. the dollar actually is hurting trade is really hurting. if there's any good news, jim will talk about the technicals, but if there's any good news, it might be that copper is a little oversold the only potential help is the fact ha the largest copper producer in the world, a mierch in chile, the miners just rejected the final offer from management that will be the only potential good news for copper. >> jim, how correlated is copper to china's growth trajectory >> i think that's mostly what we're seeing now the overarching fundamental theme is definitely the china story and the trade story.
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it's funny to me how technicals have behaved themselves so well. on may 8 we talked about a consolidation pattern. if it traded 274 we said it would trade down to 260. i'm not saying that to pat ourselves on the back. i'm saying the technicals responded well 260 supported now. >> for more futures now, check out our live show, joined by federated chief equity straft gist phil orlando, plus wells fargo's michael schumacher tells us whether the rate riots will continue all that few what matters most to the market's next move is it the economy, markets or rates? uber's big day the two key metrics to look for this afternoon with lyft, the apple watch and avengers have in common? i'll give you a hint it's basketbalretel lad. the half-time report is back right after this
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we're back let's answer some of your questions. dr. j. rad in texas hi, john, any unusual activity in bidu? >> we've had precious little now after this huge fallout from april until now when it was 180 down to 118 or wherever it is today, they're starting to nibble at the 130 call i'll throw that out to you. >> sar rat, for you from ken in north carolina sar rat recommended prudential a few weeks ago. is it still a buy? >> it is still a buy when the ten-year comes down in
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terms of yield, the stock comes down getting paid at 4% i like this company for the long-term term. >> ahmed in new york, lulu a good buy now >> the valuation has held up well in the face of this part of the reason is i think number ones the customers of lulu are not very price sensitive. number two, they don't source a lot from china sourcing the fabric and manufacturing of it is one of the easiest things to move i think it's okay. on my screen to watch. >> 45 seconds we have left. >> tjx we talked about it yesterday, unusual activity more buying today. going much higher. >> oas, upside call buying >> sar rat. >> general mills got unfairly punished yesterday. >> it was a downgrade yesterday. >> from goldman sachs to a sell. and i believe actually the growth is actually there, but i think the street took it too --
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>> steve. >> i'm going with xbi in biotech. i think it's been slaughtered too much has to go higher >> begin to take a small position in nike. >> interesting, okay keep our eyes on that. speaking of the dow, the dow is up about 59 points that does it for us "the exchange" begins now. >> here iswhat's ahead the economy, rates or china. who is holding the reins time to hail a ride? uber said to report results today for the first time as a public company that stock stuck in neutral since going public tariff breaking point. the ceo says chinese suppliers are giving him the cold shoulder and lay-offs and store closures could be next. we begin


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