tv Fast Money Halftime Report CNBC November 4, 2013 12:00pm-1:01pm EST
tough period. >> americans lost their food stamp benefits as of the end of last week. don't forget, the press conference with preet bharara 1:00. we get more questions answers regarding the settlement with s.a.c. capital. over to headquarters and collect in with scott wapner and the halftime. >> thanks so much. what we're following today. sacked, steve cohen's s.a.c. capital in a record settlement with the feds, now kate kelly has the latest on what happens to the firm. and of course its founder. tweet this, twitter ups its ipo range. traders weigh in on whether they'd buy the stock when it opens for business. the markets heading into the final stretch of the year looking for more gains. surprisingly, still looking for love. so, why is one of the strongest rallies in recent memory still searching for respect? and what does all it mean to where we go from here? "halftime". pete, where's the love in the rally? >> i think it doesn't really take a lot to find some of the love. i think part of the problem is
the fact that the financials really have not participated this in quarter. look over at some of the industrial names, i pick out ge, one of the names that i like. we've seen a lot of option paper in there look at energy names, i'm not talking about the big cap energy that everybody always likes to focus on. i'm looking at some of the mid tier names, shale names, scott. when looking at whiting petroleum, codes yak in dan bury in front of earnings, seeing paper in those, and they've been performing. whiting on a chart over the last two weeks, you'll be absolutely amazed what the movement is that you're seeing right now. but i think you can look at a lot of different categories. see in the material space, we've had activity coming into the coal names. i own peabody, cliff's now. i do not have u.s. steel. the others are participating well. >> you know what i'm getting at, right? the market's not worthy being here, it's a fed induced rally, individual investor's not in the game. why is this one of the rallies best ever so unloved? >> many have missed it.
look at the institutional flows and hear conversations that investment banks have with financial advisers most have to the captured the rally. it's one of the reasons why the momentum names are rallying they're looking for outsized type of gainans there's tremendous opportunity in the financials, still in the energy space and overall, scott, go back to what i said last week, economic data points look strong. it look like growth accelerates. >> simon baker's been sounding the call consistently. you love the rally. >> i love the rally. like i said on friday, i think there's definitely a bubble brewing but you have to be long the market. to joe's point, talking retail clients they're not participatesing in that. the question is, are you finishes between now and the rest of the year? i stay away from the retail type of names. consumer confident hit hard. commodity names, the dollar gets weaker, emerging market get
better. rio tinto, that type of name. looking in short term to get a rally between now and year end. >> what changes the conversation between now and the end of the year and even beyond that? when do you get a greater appreciation, more respect, if you will more love, as we're saying for this magnificent move in the market that we've seen. >> as the economies get stronger and as bonds go back to a rising rate environment, that's when you'll see more money shift into equities. if you're a bond holder you're in the back of a 20, 30-year bull market in bonds and rates on the continten year touch 2.4 2.48. you'll see the generational move into equities. that's when you'll see the market go into hyper drive and that's when there may be a bubble. to me there are no signs of a bubble now. >> by virtue of asking the question, and the skepticism that seems to be in the market given the rally, that would throw water on the idea there's
a bubble, at least one. >> again, go back to pure evidence. cap x spending at poor levels. m&a activity at poor levels. >> valuation, it's below bubble. >> container -- >> we have more ipos coming out than pre-1998. i belieagree economic data is t >> there are always excesses. >> there's a difference between individual stocks and the magnitude to which they've extents themselves. >> you are talking about ipo that garners a lot of interest and moves higher. we continue to see it, you see it in bad and good markets. in terms of broad averages -- >> i'm talking about more ipos, i think the market and companies realize this isn't going on forever. >> the street continues to lay off people because the ipo cycle
is far below where it's been historically on average. >> look, there certainly has been a lot of talk of bubbles lately. next guest, not fearing the froth. tom lee joins us new york city. welcome back to the show. >> thanks for having me. >> so, why is there no bubble as some have called this market over the last week or so? >> well, i think, you know, the word "bubble" has negative connotations and when we think about it for the stock market, it shouldn't be based on the price. it should be based on either p/e ratio or relative p/e and by either measure i don't think the stock market's anywhere close to a bubble. >> what you're saying, this plays into the conversation we had late last week, you think people are too hung up on the individual prices of certain stocks and that's leading them to believe there is a bubble brewing, that there's too much froth rather than the overall valuation of the market itself?
>> that's exactly right. we have to keep in mine that the median p/e of the market today is under 15 times. high yield has -- is telling us that s&ps p/e should be over 17 times now, trading at a huge discount to where the high yield market is. in terms of economic growth, i don't see any evidence that we're peaking. as you mentioned, capital spending's low. a lot of pentup demand. credit's still pretty tight. these are not signs of an economy overheating and i don't see how it leads to stock market bubble. >> you have 1775 as year-end target. you think we go through it? >> yeah. i don't think 1775 is going to be any obstacle for the market between now and year-end. one of the things that we want to emphasize, though, we think there's this tilt that's going to happen back into cyclicals and year-end. part of it people think of next year, growth picking up. part of it is some of the hedge
funds are starting to increase exposure to cyclical stocks and that's going to lift those sectors ahead of the market. >> simon baker? >> i wanted to pick up on that point. you said go to cyclicals. your other note, mutual funds are trying to take profit, some of the defense everybody names. how do you play it? cyclicals or defense everybodies? >> generally speaking, on the margin we feel hedge fund player drive changes in the marketplace. mute funds have had good year. a lot are trying to protect gains by either hugging the benchmark or moving towards defensive stocks. we've seen seeing some selling in the path month. if the index levels elevate and cyclicals outperform you're going to see a rotation for mutual fund managers back to risk on. >> where's the love? why are we in the middle of a major bull market that people
seem to have little respect for? >> i have to agree with all of the symptoms. this is a bull market people don't like, don't respect. i think individuals, es sessionally high net worth individuals have huge cash positions. i just think that right now stocks don't have any respect. i think there's a feeling that the best way to make money is through fixed income or real return instruments and i think people are forgetting over time equities have been a great real turn vehicle. >> isn't that one thing you want to hear if you're -- if you believe in the market, you're invested in stocks? once it goes the other way, once everybody loves it, that's when the danger signs are. >> that's right. i mean we do want to be in a period -- what i envision over the next three years people do really start to embrace equities. it really lifts the p/e but i agree with you, steve, i don't think the market's going to peak in 2014. i think we're mid cycle into a secular bull market.
>> good to talk to you as always. >> tom lee at jpmorgan. what you alluded to, it's healthy to have this big dose of skepticism. >> thanks for having me. >> you need two sides of a trade. when there's skepticism, to me, that limits you down side. when you have so many negative voices, larry fink, a smart guy, huge respect, when he's saying bubble, that's great because the risk is out there, it's talked about. i like the market quite a bit. ecb may give us another leg up if they ease thursday. >> a look at what's moving now. dominic chu? >> blackberry they're getting bruised in trading, after the company said it was ditching its efforts to put itself up for sale. instead, secure $1 billion in financing from an investor group led by fairfax one of the biggest shareholders. ceo thorsten heins would be replaced on an interim basis by john chen who will also take on that role of executive chairman. all of this leading to a sharp
drop, scott, in the blackberry shares. >> thanks so much. steve weiss, what do you make of the latest? >> i love the phone. i've got the z-30. >> you consistently love the phone. >> i don't like the stock. thorsten heins, he's a nice guy, maybe you know very highly -- high quality ceo, the facts are when you are talking about a dynamic technology company, he was the wrong guy to be the spokesperson. >> do you like the stock here? >> no, i wouldn't buy it here. >> always skepticism about the talk about the deal. >> they never had financing. >> the stock never got quite, best i can recall, to the deal price of nine bucks? it never quite got there. there's a dose of skepticism. >> what would have gotten me interested in the stock. today being the deadline, they would have said, we've narrowed it down, narrow it down to two parties, now we're going to have sealed bids, let's see what happens. there's no hope here. >> i think when you look at the name, it is absolutely been slaughtered. when you look at bare bones of
the company, the patent portfolios worth, estimates about 1.6 billion, by the way, cash of about 2.6 billion, scott. now you're starting to get into the position that everybody's giving up on yahoo! if you remember going back, some of the parts, everybody said the company's terrible, they're not doing anything write. it was the sum of the parts story. this is sum of the parts. >> you saying buy the stock. >> i'd buy the options not the stock. >> this is nothing like yahoo! yahoo! you could measure the value with ali baba. >> i'm giving you the portfolio of what they've got in patents and the cash. that's completely measurable. >> the defense in the stock is the average consumer can't measure the value. >> this is more like jcpenney, a desperate company. >> without the bricks and mortars, withover estimates. >> the valuation on jcpenney that went away. capitalism at work. it's a bad company. bad model.
technology moved on. let it fail. >> bad company with bad products for the last couple of years, highly core related to the iphone. what scares me about the conversation, we talked about the top of the show, it's a market that's not loved, folks aren't in there. they go out and try to chase those big returns, they look at a stock like blackberry, see potential there. this is an option that i would avoid. >> 2% market share in phones. >> pete i hear what you're saying. but there's a gentleman on earlier who i thought made a good analysis by saying that this is has become a trading card model. >> yeah. >> regardless of what you want to say the patents are worth, intellectual property, et cetera. it's only worth what somebody's willing to give you. >> some folks have business deedings, we've gone through the with, whether it's qualcomm, microsoft, above that may have interest in the company, i'm looking at it and think they have stripped it bare. it's a company sitting there. not sitting on values of land
that nobody can put prices on that. but big box retail is dead. so that's why i say it's a completely different than jcpenney. >> speaking of jcpenney, it's on the rise again today. steve weiss ready to take profits on his short? we'll get a trade update. embattled hedge fund s.a.c. capital agrees to record deal with the justice department. kate kelly outside the new york city courthouse where it's going down. >> behind me we're expecting the judge and her colleagues to sign off on a plea agreement between s.a.c. and the government as early as today. more details when i get back. welcome back to "the half".
top three trades now. first up, that tock, 2% gain for lululemon despite receiving a fresh batch of complaints about the quality of yoga pants comes out months after the company had to pull items from shelves due to transparency issues, pete, shall we say? >> yes, it did have transparency issues, the pants being too sheer. now it's about pilling. if you listen to the company themselves, they are talking about this being a miniscule number of complaints so they're trying to downplay this. they obviously in june, when
they beat on the top line, beat on the bottom line, raised guidance and did everything rite with revenues and sales growth, people were not happy about the loss of the ceo, potential of her stepping down. it's a five-year plan. i like the company on any one of the pullbacks. i think they're killing it now. they have competition coming from under armour and nike, something that you have to be aware. >> speaking of beating on the top and bottom line, that's what kellogg has done. there's the stock, up nearly 2%. >> i mean, you know it beat on the top, the bottom line. why the stock is up, a couple cents today, on its cost cutting program. the business is anemic. it's a highly competitive industry with cereals. i'd stay away from the stock. >> momentum can be your friend, momentum can be your foe. the deal with jcpenney and your short position given the stock's up 15% in a week? >> yes.
so i've always traded this short, that's what you have to do with any short in the market, particularly ones that have a shy short interest. i covered half of the position last week. i put an order in cover the rest of the position today. i probably got executed on it. i will short the stock again. momentum subsides. you're in a tough retail environment and this one will suffer the most. >> pete, help me understand, if you're willing to take a chance on blackberry, there seems to be momentum behind jcpenney and this reversal and 15% move. >> right. after the bashing -- after the bashing that it's taken, i still think this company has a little bit of room to rise from these levels. i don't think it's really even worth it at this point in time, however. >> joe? >> i -- both cases, it's not where i want to put my money or suggest anyone do the same. >> you think the company's going to be true to its word, the results are going to match what the company said about positive comps coming out of the third
quarter? reason to take a chance? >> cash needs. cash needs. i think jcpenney over the last year stated x amount of capital needs and in each time they've misses. >> you've had experience management given guidance. >> sales don't mean they're making money. they can have sales up 10% and lose a boatload of money&and there's the margin issue, too, heading into the holiday season where you have to give stuff away to get people to come to the store. >> probably shirt and tie combination. >> breaking news on steve cohen, hedge fund s.a.c. capital. the firm agreeing to record $1.8 billion settlement with the government. ace reporter kate kelly followed this from the beginning and joins us from new york city with the latest. kate? >> scott, thanks so much. having read through these resolution dock mondocuments pu together by preet bharara, interesting highlights to the settlement word which the judge is behind me expected to sign
off on on the earliest convenience. the $1.8 billion fine, a record, as far as we know for insider trading case, fines paid in the galyon cases were far, far lower. in addition, s.a.c. pleading guilty to five criminal charges, one of wire fraud, four of securities fraud. more detail on that to come. finally, surrendering investment registration as a hedge fund fund, no longer operating as a hedge fund in the future. details of the frame yet to be determined. two interesting nexts to point out. one it seems they'll be in business, as a family office and there are a number of issues in the language predicated on that idea. and, two, they're going to have to commit to independent monitoring, they'll have a compliance monitor who is approved by the government overseeing their trading and any potential issues of insider trading to see those rules are followed, to prevent that. and also there will be a five-year probation, i expect to get more details, scott, on what
that means at a 1:00 press conference with u.s. attorney bharara over my right shoulder which is not long. >> given the fact that s.a.c. responsible for awful lot of trading activity, do you want to weigh in on what you think the impact more broadly to the markets is going to be, specifically prime brokers, et cetera? >> i do. i do want to weigh in on that. so perhaps surprisingly, they manage about $9 billion or more even once they return the public invftser money they're in the process of doing by year-end. they're still trading a large amount of aum. i spoke to several firms, i'm told for now it's business as usual. this guilty plea in itself does not trigger any breakup plans. could be language in the prime brokerage agreements that allowed firms to do that. the u.s. attorneys office kept wall street feeling comfortable. for a fact, goldman sachs, black
tone and others reached out to the government to ask for guidance when s.a.c. first indicted in july and told, hang with them, we don't want to hurt third parties, whether that's you or investors. continue trading normally. as soon as possible they got a protective order to make that confirmed. >> kate, thanks so much. we'll let you go april large truck or bus going by there. >> busy day here at the courthouse. >> i'm sure it has. likely to get more busy. look forward to preet bharara news conference at top of the hour, 1:00 p.m. kate, thank you. steve weiss, you want to add to that? the ultimate or eventual, guys, we can all talk about this, third party risk more than anything, not a comment on s.a.c. >> right, the money's going elsewhere. they can go to other hedge funds. in firms of s.a.c.'s book or the nature of how they trade, they are short term. so they didn't carry big outstanding balances, although they were a good prime brokerage
clients, is my guess. it will be somewhat of a hiccup to the street but not a lot. with trading going through the pipes so much more, with very, very low cost rather than trading desks, i don't know if it's going to be felt. >> can i get someone to comment? maybe you weiss as well. what this means for the broader hedge fund business, a firm as notable as this one, and this latest development that now has taken place? >> well, i think -- i think if they were successful here, they might be trying to target other hedge funds. he basically got caught with his hands in the cookie jar. during that certain period of time, there's a lot of successful hedge fund managers who i think have changed their practices since then. they might target when they get a lot of money like that there this is a significant page turn in the history of one of the best known firms in the world. one of the pioneers of the hedge fund business. certainly one of the most
successful over the last couple of decades. >> agreed. but i think you would see in terms -- think about it, asset allocation, everybody wants alternatives. we have talked about that. what are al tentatives? they're exposure to hedge fund. all investment banks rolling out new offproducts, the street, the retail level clamoring for it. i agree with steven, that it is not going to have significant flow impact on hedge funds at all. >> next up on "the half" goldman giving the steel sector a big boost. is the analyst too late to the game after a run-up lately? next, the countdown is on. twitter's ipo day as way. the stock's pricing. >> like clock work, ipo price range up this morning. what that means for the deal.
welcome back. twitter's confidence increasing ahead of it's ipo. raising the price range for the stock. kayla tausche joins us following that story and has the latest. >> it's the homestretch of the highly anticipated ipo. executives are rounding out meetings with investors on the west coast. bankers deciding how to engineer the deal now that they have a better sense of wall street's demand. twitter raises the price range for shares it will offer, 23 to 25 a share is the new range up from 17 to 20 a share prely. that means the company could raise $2 billion valuing the
company at $13.6 billion, including employee stock units that becomes higher. twitter bankers could increase the size of the offering from 70 million shares. reuters reporting the deadline for stock orders tomorrow at noon. that's earlier than expected. investors recall facebook's flubs. giving retail investors more than 20% of the deal. this time is different. there are no sellers and during the facebook ipo goldman sace. warn it was to expensive. institutional investors not retail. retail dumping facebook stock when it didn't open and giving themselves more than a day to sift through orders. to make sure the balance is just right, the people that end up with the shares, thursday, are
in a perfect world long-term investors. >> kayla, thanks so much. a big day. a big week. looking forward to that. analysts started to weigh in on twitter. topeka capital, $54 a share. how should investors trade the ipo? what price level is twitter a buy? weiss, if you go from 17 to 20, now to 23, 25, it's somewhat of a game changer almost for how the retail investor should perhaps view this thing. it's going to get a pop off the open. a pop at 17 is a different than a pop off 25. >> if they didn't raise the price range the ipo would have likely failed because everybody anticipated raising the price range, particularly coming out so low. i don't think it's overvalues relative other stocks in the universe in terms how they're ral viewing revenues going forward. i pe expect it to work, it will pop.
but to me this is just a valuation level i'm not comfortable playing with. facebook trading down, linked in trading down, yelp off the high is not good for the sector. >> unless the money coming off the stocks goes to twitter. new kid off the block. >> i don't believe that. flows good into mutual funds. maybe on the margin. >> linked in is up 100% from the ipo price. >> what is an acceptable level for the retail investor to get in on this stock? >> look, two things. one i think this is a stock that when it comes out if it's below the midst 30s, i think you buy it. this is something that you're going to have to maintain for a significant amount of time. i like what they've done with mobile. okay? 75% of their users are mobile. 70% of the revenue is from mobile. lastly, this is different than facebook because this has the potential, look at market cap, difference between this and facebook, this has potential to be a target in m&a.
>> it's only potentially up to 30 bucks off the open. you don't think there's a more significant pop? if it prices at 25, that's not much of a bump off the open. >> i say mid-30s. i don't know. i'm not going to spec late on what happens in the first couple of days. >> i want to know what's going to happen in the first couple of minutes. >> retail shut out on the initial allocations of the ipo, they're going to come in and bid it up. you could see a stock with a four handle on it when it starts trading. >> scott, if you're a retail investor, this is not a science. so much emotion going on. if they increase by 10 million shares, i think you've go to go with joe terranova's point. off have to come up with a number. ipo targets, pick a number you're comfortable with. for me, 35. if you like it long term, buy it. if it's over that, don't chase it. that's the way you've got to go
in and strategize. you can get carried away. >> don't forget, targets aren't the target off the ipo. these targets are down the line. people get very excited when they see 50, 54 some of the price targets. the most critical difference, kayla points it out, this is targeted towards the institutional investors, not retail. institutional investors have their hands in their pockets not selling right away. that's a benefit for the ipo. but, as john talked about, 17 to 20, up 25%, buy into it. i think now, at $25, if it gets up in low 30s, i don't want to touch the stock. i think there's downside to worry about. >> tomorrow, we'll talk to the ceo of the new york stock exchange what it means to win the big ipo. bob peck the first analyst to initiate coverage on the stock with a buy rating. he's going to join us thursday. with a man who knows tech better
than most, roger mcnamee. time for our call of the day. u.s. steel and ak steel notable underperformers this year. but both companies on a tear this past month. goldman's taking notice, upgrading the space to neutral from cautious, naming ak steel and u.s. steel among top picks. steve weiss, as far as i know you've been a long-term bear on the steel space, yes? >> i have. i haven't been involved in it for probably six months to a year. but i did go out and buy peabody, btu, walter, last we. i bought more this morning. they're the most leveraged to steel. it's a chicken way to play it. steel capacity's not cut meaningfully. coal capacity is, they're met coal. i like the stocks. i think it's going to higher. >> i have you and grasso down on the floor in my ear, you know, about -- >> i think he was loving aks at
7. >> we'll have to have grasso get in on one of the days. anybody buying with goldman. >> i think the turnaround story's there, manufacturing figure globally look good. names over the last two weeks have been performing well. >> is that the problem? >> they've been performing well. when you look at names and peabody and look at u.s. steel, move it's made, have they missed it? goldman's off on the name. >> let's plea give you a name, going obeyond ak steel and u.s. steel. it has had the outperformance this year. i think it continues, they're best position. >> a lot of winners and losers. a lot of volatility. goldman says, i think you buy a basset, a good broad base. >> buy into the gap, shares have taken a beating, talling more than 10%. goldman adding insult to injury.
downgrading the stock but one of our traders says to buy the dip. a fashionable debate on tap. what was the retail investor buying and selling in october no nobody better to ask their nicole sherrod. take a look at the dow heat now. exxon mobil and merck leading gains. it's a split decision now for the dow.
welcome back. a rough month for shares of the gap, falling 8%. goldman downgrading. will the holiday season bring it back to life. >> 1:30 on the clock. >> it's interest goldman downgrade it today. how about that back-to-school season that goldman was so excited about? that's what you should be excited about, back-to-school, holiday season, gap outperforming peers. market slowdown. the sales p&l taken that, invested it into operational expenses, that's going to support gross margins. that's going to support eps in 2014. i'm not worried about it. the online e-commerce strategy is there. only 12% of sales now.
but 50% of traffic is based on e-commerce potential upside significant. >> value trap all the way. traffic numbers are down. back-to-school, going into the holidays, but ho september numbers? down 6% across the board when you look at banana republic and the gap stores, combined entities. their demand and what they've got on the shelves is not working for them now. traffic numbers as i say are down. with margins starting to come down with pressure on the margins, this is a classic value trap. i'd rather be in multiple names on gap. tjx, ross stores, fred, find names are that are doing. >> i'll take tjx, freds, not over pap. >> why not. >> the september numbers are not as important as august because, again, focusing on the back-to-school season. if you told me when the stock was trading 46 in ausgust this s
a value trap at the time, fine. 36.50 it's washed out. >> the desk, steve weiss, simon baker, weiss, you first. who made the more compelling argument? >> right now pete did. i don't think there's a lot of downside in the stock. look at it, 5%, 10% over. fashion stocks cut both ways. they need a new cycle. >> gas prices falling dramatically, is that the savior for many retailers holiday season including gap. >> that's a part of it. i said i'd be avoiding these names generally because consumer confidence has been hit. i think it's a screaming buy. i say it's a -- it's trading 13.2 times earnings. little companies do well. lululemon continue to make mistakes, we saw it in the news with the quality control. they nailed it in terms of
fashion, the denim jeans, colored jeans, it's a good buy. >> use #bull or #bear. we'll give you results as we do at the end of the show. market flash with dominic. >> well, scott, how about this in shares of herbalife down in trading, third straight day of declines. concern that hedge fund manager bill ackman going to take another go at bringing down herbalife. he put on a high profile bet against the shares. since your report on thursday, last thursday, ackman was going to put that big presentation on later this month, shares have lid around 9%. but herbalife, remember, up 86% this year. that trade is definitely not going ackman's way up until now. we'll see if anything changes that. >> thanks. the stock guys, have been hanging out in the upper 60s for a couple of months minimum.
people are wonder what ackman has up his sleeve, he's got another presentation coming. >> i wouldn't be too worried. after the first presentation, trade down and the stock received double. >> fair. the stock got creamed. the day that he -- >> he traded down. >> it took a while. >> he was the only visible voice on it at the time. then you came out with others that have a stronger voice and multiple people. to me, a story, he may be right ultimately. right now it's an old trade, people don't want to be in a post icahn trade we saw what happened to netflix. i don't think it's coincidental, traded down. >> did the retail investor buy or sell major stocks in october? should you follow suit. nicole sherrod is here on set revealing that answer and more.
we'll take it live for you and get all of the latest news from kate kelly as well. she's going to join us. shares of tri pointe soaring, a top 20 u.s. home builder. the ceo joins us. out with the old, in with the new. blackberry removing its ceo. who the new guy is that's in charge. does he have what it takes to save blackberry? all of that at 1:00 p.m. eastern time. back to scotty. >> thanks so much. see you at the top of the hour. nobody has a better read on the everyday investor than t.d. ameritrade. individual traders are making some surprising moves. joining us, nicole sherrod. welcome back. >> great to be here. >> most surprising, october data, right up until the end of the month, it's as current as current gets, buying facebook, netflix, tesla, a lot of napes with momentum some would say has broken down. >> yeah. facebook, in particular, it was
the number one top traded stock for the t. dad. ameritrade. facebook and google had great earnings. net sellers in google but they stayed in the facebook position as if to indicate that they think that there's more upside there. >> i wonder if retail is getting in late on names like netflix and tesla, what you make of that. >> yeah. if you read our older reports for the investor movement index, they've been participating in tesla since the start of the year. same with facebook, they've been slow willing adding to positions. they've been in it. >> i wonder if they should have been selling a little bit of it rather than buying more. guys, any thoughts on that in. >> where do you see the interest going? with the momentum dying, do you see going to the material space, like we've been talking about, defensive names? where's the next group that's the most actively traded with your client base? >> in october there was a lot of money going into services
sector. so it was facebook, we also saw what i thought was interesting, jcpenney, more of a trade or play. those weren't long-term investors getting into jcpenney. but, yeah, a lot in the momentum names. >> what's interesting is sellers were in banks, bank of america, citi, you were buying what they were selling, weiss. general electric and alcoa. talk to us about that. >> yeah, i think, for three consecutive months, we've had net selling in the financial names and i think a lot of that has been shifting over to some more of the momentum plays. >> what do you think of that, pete? net selling for three straight months on stocks that you love. >> indeed. the surprising ones not so much financials because they're flat for the quarter. they've probably caught them and now they're getting right and maybe taking sole of that off. when you talk about ge, that's go on a steady path to the upside. with energy exposure and everything else, i'm surprised
that they're getting negative on ge at this point in time. that one still from a valuation, despite it's near 52-week highsing there's plenty of upside. >> what i've observed from the launch of the the retail as th market pushes to higher highs they tend to take profits off the table. october was unique in that they were net buyers and so they dialed up their equities in october, but the focus was concentrated not across the broad market but more in the individual momentum names like netflix and tesla. >> thanks so much. >> nicole sherrod. biggest pops and drops in midday trading. volcan materials. sime been baker. >> vmc with a big pop. blew through numbers. this is a space we like. people buying more highways. one thing i like about this company a lot of analysts don't like this company. once they beat earnings on the
upside you see a lot of sell side analysts do what they always do and start upgrading it. >> steve weiss, lcc. british airways. >> every once in a while i get something right. the merger is going to happen. american airlines, that's also popping. i continue to be long on both i think it happens and the airline industry looks great. >> pete, realgy. >> they put up a hue q3. 6 to 8% growth for transactions and year to date, full year, 17 to 19%. that's huge. >> avt. avon products. >> very ugly and obviously the resolution with the sec is not in place yet. you have to have concerns over the doj and potential moody's cut. i would avoid the stock and i would actually say women should wear less makeup. coming up at 15 bucks a share someone on this desk said my con con's -- micron's rally was over. what does the same trader have to say now somes the stock is hitting 17. from burritos to gas, traders
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>> yep. >> what do you do now? >> listen, i don't want any part of it. clearly i'm wrong and a lot has been on darm pricing moving higher. that's going to come back on-line that production in q1 and pressure price and increase invento inventory. >> i love it. i loved it then. you join iun back and forth on that one. >> i didn't go back and forth. >> you said sold to you. i love that stock and think the stock goes higher. >> that's not going back and forth. >> this is going back and forth. >> all right. we're going to move on. we deliver with trades on four stocks that have lit up our twitter feed, hess, chipotle, marriott and sands. simon, hess. >> this has been a winner all year up 50% year to date. any space we like in industrials, global exploration and the company still got $3.5 billion worth of buyback coming so it's got a natural floor. own it here. >> pete, chipotle, buy, sell or hold? >> i love this name and despite the fact you look at that pe it's a little fearful at 41 even
on the forward had this is a name i think goes higher. >> las vegas sands. >> still a great way to play the consumer cash coming out of china. i think the stock looks great here. i'd continue to own it. >> marriott. >> ritz-carlton doing well, 52-week high. stay with it. >> quick break and final trades and who you think won our debate on the gap. when we come back. ♪ ♪ here we are, me and you ♪ on the road ♪ and we know that it goes on and on ♪ [ female announcer ] you're the boss of your life. in charge of making memories and keeping promises. ask your financial professional how lincoln financial can help you take charge of your future.
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before starting humira , your doctor should test you for tb. ask your doctor if you live in or have been to a region where certain fungal infections are common. tell your doctor if you have had tb, hepatitis b, are prone to infections, or have symptoms such as fever, fatigue, cough, or sores. you should not start humira if you have any kind of infection. ask your doctor if humira can work for you. this is humira at work. all right. welcome back. the all right. welcome back. the results are in and you said pete the bear won the debate on the gap. pete, congratulations to you. >> hate being the bear. >> give us the final trade. >> dan berry, talked about it top of the show, the energy space, mid continent, it's going higher. >> amgen, add large cap biotech, still a cheap stock and undervalued. >> joe terranova. >> energy space, mur be long. >> simon, hertz reporting after the close, love ta space, buy it going into earnings. >> look ahead, is this a huge
week we've kicked off, ecb, gdp, jobs report, what do we expect? >> basically the euro etf, i think that goes well, if they cut it's going to be like japan. >> that does it for us. have a great rest of the day. "power lunch" begins now. and we welcome you to "power lunch" and we begin with breaking news. embattled hedge fund sack capital reaching a settlement with the government, a landmark insider trading case against the firm. steven cohen's hedge fund pleading guilty and paying almost $2 billion stemming from the investigation that led almost five years. the u.s. attorney for the southern district of new york is set to hold a news conference at that podium moments from now. when that begins we will take you live. my partner tyler at the nyse, first to kate kelly at the