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tv   Fast Money Halftime Report  CNBC  April 15, 2014 12:00pm-1:01pm EDT

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territory, and nearly 30% are in bear market territory, which means we are down 20% from the highs. so everyone watching the levels at the nasdaq, carl, and how much lower we can go. >> yeah, matt melee mentions the 200-day at 3942. maybe a level. scott wapner, you'll have a lot to watch. >> not that far away from a nasdaq official correction, and it's been sometime, as you and kayla were just documents. >> 3,960, 3,942, pick your number, it doesn't look like a day to the upside, scott. >> yeah, pretty ugly. welcome to the "halftime." right on the mark, bill is here live on the latest moves he's making in his portfolio. pass the mayo. what does one of the bank's biggest critics think now? we'll ask mike mayo. who is likely to win the
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battle for domination? let's meet pete, jon, joe, and steph. the nasdaq is once again the scene of the crime. the index falling to a three and a half month low. we can attack this from a number of fronts. it's not only the growing number of stocks officially in correction territory. some of the big names we talk about on an everyday basis, whether it's the teslas or amazons, you have to keep an eye on the 10-year, 2.61 and dropping fast. what has your eye today, joe? >> you have to keep your eye on the europe. the dax down 1.75%. you have to keep your eye on japan. look, the rally we got over the past couple of days, obviously now, meeting selling pressure. that's what i expect. i think the quarter will be problematic going forward. that being said, what you have right now in this environment, i think, is a high degree of complacency and many folks saying, this is good, it's healthy, don't worry about it.
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really? what's going on with ukraine? [ overlapping speakers ] -- serious enough. i think the energy rally is telling you something about this the situation in ukraine. we'll get the china gdp. that will look lousy. there are a lot of obstacles in the market and we're treating it complacent. >> pete, you're been one of the more bullish guys on the desk. is that starting to waiver? and if not, why? how can't it? >> well, the names we've talked about continue to outperform and the names that are under the pressure are the same names we bring up every single day that are dragging down these markets. i think there was great examples. we had a two-day rally we're coming off of. up 15 yesterday. earlier in the session up 12 points. volatility index did not drop, scott. it still hung around 1,575, which is extreme, unless there is nervousness about the stock moving around, the market moving around that much more. look at the eem, that cracked early, as well. volatility index, as i
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mentioned. there's a lot of cracks that are starting to show up, but you're there with certain support levels, and caterpillar holding up, ibm, hewlett-packard, intel. the names we've been talking about, they've been holding in there, but it's been the high beta and the names with so much of the high multiple, as well. >> i would come back and say, a lot more names are now participating that didn't previously. so wynn, down 6%, starbucks down 1.5%, below 70. some of the names hanging in there, they're cracking, as well. consumer discretionary is trading awful. i think you have to give consideration into why that's happening. that's a little outside of those muchl names. >> i think it's the rotation away from value, as the economic gets better, everyone is nervous the fed will tighten much sooner than expected. and so, you are seeing utilit s utilities, they are the leaders, right? >> right. >> and some of the laggards, the blue chips, in the s&p or in the dow, coke is a perfect example.
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this was a total laggard last year, and year to date -- year to date down 6%, not after today, but it was a laggard last year. i think people are going to the laggards. look at chevron, ibm, microsoft, look at some of the stocks -- maybe not microsoft, because they didn't lag, but some of the older-school blue chip names, people are rotating -- >> look at it from an earnings standpoint. coca-cola, johnson & johnson. >> and i think that will continue because the economic data will get better. >> my is the 10-year falling fast if the economy -- >> that's a big worry point. i think it has to do with europe and deflation concerns. the numbering out of china, one data point after another that's been horrific. there's not a lot of good about the global situation now. but here in the u.s., all of the economic data points are showing that we'll see a snap-back in march and april and may data. >> doc? >> well, some of the stocks that i have been trading lately aren't on that big momentum list.
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in fact, very few are. i took a shot last friday on biogenide, and both of those had nice bounces into today, to pete's point, when we're up 12 handles in the s&p. you're getting chances, judge, but most of the stuff i'm in is not that momentum, because the momentum stocks are to the downside. so if you're a bear, this is a great time to be playing momentum. because the momentum is to the downside. there's no momentum to the upside. >> there's only six dow stocks right now that are in the green. if the dow relatively speaking has been holding up. to what the nasdaq's been doing. doesn't, to joe's point, it's only a matter of time, right? don't you believe that, if the -- if the overall market continues -- if the nasdaq continues to fall out of bed, you really think it's a bifurcated market that much, you'll get a dow and s&p look good in the face of a nasdaq -- >> well, again, for s&p 500, you
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have a lot of stocks in the nasdaq. and anybody who's running a hedge fund now, they're probably outperforming, judge, because of the hedge. >> the hedge fund has been getting crushed. so many of the hedge funds have been getting crushed. >> the same thing that held them back last year, it was the hedge. in other words, beta itself, picking out performing stocks, that's been the way to go until now. now, the people that do have that hedge in place are the people that are outperforming, not the people that are picking stocks necessarily. most of those folks that have beta are losing, because the mo-mo stocks are trading to the downside. >> it will be interesting to see if they can deliver on earnings and how the reactions are. do people look for the cracks in the stories? will facebook say this is the peak kind of story? the reactions will be very telling. >> i'm one of the people that thinks growth is going to accelerate. i've talked about it all year. growth is coming back. i think the market has to get shaken out first. i think there's too many people
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that came into this year with high expectations that are still sitting on assets that are declining. you and i talked before the show, when you look at japanese equities in 2013, $130 billion-plus poured into it. well, the overall indices is down 14%. you would expect a large amount of that to come out, not at all. $20 billion. that's it. the markets right now are speculatively long, long-risk, and they need -- >> that's why the laggards make sense. >> let's move on to talk to bill nygrin, his picking style could be described as slow, steady, and smart. bill, as said, portfolio manager of the five-star oak mark fund live from chicago right now. bill, as you're watching this market, and i know you're a stock picker, and i know you're a value player, and maybe you don't pay attention to every tick of the market as closely as the folks sitting in front of me do, but are you concerned by what you're seeing from the
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nasdaq standpoint and the other parts of the market? >> i would say, no, we're not concerned. and what we do is so differently than most investors do, is we try to get an idea of where the fundamentals will take a stock over the next five to seven years. and it almost always, relative will tour style, investors are almost always overweighting near-term events. so we look out five to seven years. we don't see the potential we did five years ago. when the stocks have tripled since the bottom. over the next five to seven years, when you compare the alternatives of stocks, cash, or bonds, to us, stocks look substantially better. >> you are revealing on the show today a group of stocks that are in new purchases for the portfolio. we can talk about some of them, or we're going to talk about one of these a little later on, and that's citigroup. why citi? why'd you add it, and what do you see going forward? >> well, at oak mark, our favorite industry for the past couple of years has been financials, and it continues to be.
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we think that especially the banks are very cheap. most of them now have excess capital. and most of them have the mentality that if they don't get loan growth, they're going to grow through shrinking the denominator, share repurchase. citi, a year ago we thought, had a more complicated story and was being priced consistently with the other stocks, but in the past year, moat of the financials are up 20%, 30%, and citi's basically flat. you can still buy citi at 80% of tangible book value. and we think about eight times recovery earnings, assuming interest rates go up a little bit. >> do you want to talk to us about general mills, another new addition to the oak mark fund? >> sure. the other three additions in the oak mark fund are different from citi. they tend to be the stocks that the frustrated fixed income buyers had bid up to what we thought were too expensive levels early in 2013. and then, through the rest of 2013, what i call the safety stocks, tended to perform more
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like bonds. so pretty much missed out on the rally the s&p had last year. so general mills, sanifee and deagio were new names. all three are exceptionally good businesses, sell 15 to 17 times next year's eps, pay to a 2%, 3% dividend yield. so we think as those names as being, you know, far better than average, but selling for about average multiples, and has the nice kicker that dividend yield about matches what you could get on the 10-year bond. >> on general mills, what about the competitive landscape and pricing capabilities? is it under pressure? >> general mills has especially been under pressure because of the loss share in yogurt, the greek yogurt has been doing so much better than their own brand. but we think that's largely played out and the share has bottomed there. if you look long term, one of general mills' most interesting
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assets is its cereal joint venture with nestle that has very good emerging market exposure. we think the asset is undervalued by most investors and creates a better growth opportunity for general mills that most people appreciate. >> bill, we heard from the hedge fund manager, kyle bass, earlier on cnbc, standing by general motors. you are, as well. why? >> yes, we're large general motors shareholders. the stock in the mid-30s, we think that within a couple year, they should be able to earn $6 a share. it make it is a very low p.e. for this market. and we've seen before, you know, toyota go through short-term p.r. crises, and other auto companies, also, and they tend to recover. and we think general motors will regain its market share if they lose some because of the current p.r. environment. and just, it's a very, very cheap stock. you don't have to believe this is anywhere near an average
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company to believe it should be selling at a higher price than it currently is. >> bill, appreciate you coming on, sharing your new ideas with us and all of our viewers. >> thank you for having me. >> okay, guys, comment from anybody? >> i love the name sanifee, and when you look at what bill is talking about, that's who he is. looking for growth but stability. some yield without volatility. when you look at the names, that's what you're getting. the one exception and most interesting name of all of these now is citi. and i'm sure part of that has to do with, i'm sure, he feels that they're going to be able to convince the fed, judge, that at some point they can return money to the share shoulders and he'll be the beneficiaries. >> but the capital levels are very strong. that's not the part of the story you need to worry about. you need to await the announcement for the buybacks and dividends, but that's not why you should be concerned. if anything, you want to go other way. my playbook playoff, it's hurt, down quite a lot, but the
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balance sheet is cheap -- >> yeah, i'm not saying that's a concern. but that's one of the catalysts bill sees as one of the reasons on the sell-off, why not jump into citi? >> i'm sure you're not shocked to hear not one single mo-mo name on the list. >> that's how bill rolls. >> exactly. that is how he rolls, and that's what's successful right now. if you're in the mo-mo names, you have to be short the names. you can't be long them right here. >> you sound like you're at odds with your brother a little bit. >> no. >> you don't like -- none of the mo-mo -- >> i have yet to jump into facebook, for instance. i've yet to jump into tesla. >> i'm not trying to start a fight. >> one of the reasons not to jump into the names, the mutual fund community is not going to go out, be the marginal buyer. >> all right. coming up, mike mayo demanding answers on citi's call yesterday. did he get them? we'll find out later. the war in the valley with facebook and google squaring
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off. who will dominate? wait until you hear what our next guest says what it's all really about. nasdaq sell-off continues today. we'll go live to the market site after the break to find out exactly what the story is. lots of red on the board for the nasdaq 100. we're back after this. make it happen with fidelity active trader pro. it's one more innovative reason serious investors are choosing fidelity. call or click to open your fidelity account today.
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welcome back. nasdaq has moved off the worst levels. sheila damis watching it very closely. >> both the 100 and composite are now down over 1%. we are off session lows. but a lot of damage has been done to the nasdaq over the past couple of weekis. we're very close to the correction territory. we're now down about 8.5% since the march highs. 75% of the nasdaq 100 is in correction territory, so down more than 10% from the highs. almost 30% is in bear market territory. so nearly down 20% since the highs. so a lot of damage has been done. as for what traders are watching, continued weakness in biotech, now down 2% today. the momentum names we keep on talking about, they just keep on falling. the momentum going in the wrong direction. and interestingly, people are also now watching the semiconductors. it has been a relative source of
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strength, but now we're seeing that decline. what's dragging down the nasdaq the most? apple, google, facebook, they're continuing to go down. 3,942, the 200-day moving average. if we slice below that, the blood bath continue, and earnings could be a big catalyst either way. >> sheila, thank you so much. let's check in with rick santelli. rick, we were talking about the move in rates today. specifically, the 10-year, got right around 2.60. how concerning is that move? why do you think it's happening? because if you would ask liesman, for example, he would say nothing in the economic data would suggest that it should be sliding the way it is. is it a more global story, deflation, things like that, rather than what's taking place in the u.s.? >> well, i personally don't think it's a deflation story or disinflation story. i think it's both a global and domestic economy equation. i think the weather issues is --
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as obvious as they are, it may not be enough to pull kind of that inventory buildup from the end of last year into the second quarter. first quarter gdp that we're going to get in about two weeks, anywhere from up .5 to 2%. everybody is pushing that growth into the second quarter. but it's the fits and starts. from a global dynamic, you know, if you have a central bank in the form of the ecb that's talking about more stimulus, where you have the chinese, whether it's peer-to-peer, there's a lot of billions of stimulus in the system. and i think that augers for a general conclusion that things aren't as good as they need to be. i understand there's geopolitical issues there, but i don't think that's the driving force. it's also the curve flattening. today, we seed yields in the five-year are stubborn. yields in the ten-year have come down more. to me, that is also, with regard to fed and monetary policy, the market's perception of zero interest rate policy ending is
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colliding with the notion that growth isn't enough, but it might be the new normal. and in terms of the benchmark, everybody's looking at 2.60. i will continue to say the low closing yield for the year is on february 3rd at 2.57.8, we'll round it out to 2.58%. and i think should we close there, especially on a weekly basis, i think that would get some momentum. i think there's a generalized fielding of uncertainty on technology and the mo-mo stocks, an that's the simple reason why treasuries seem to be the new t.i.n.a. out there. >> you think that's the line in the sand, 2.58? >> on a closing basis, yes, sir. >> all right. thank you for popping on with us, rick. some are calling it the war in the valley. facebook and google going toe-to-toe over drones, phones, and seemingly everything else. who will win? kevin delaney is the editor in chief of, and good to see you again. >> hey, scott. >> what's at stake for the two companies?
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>> at the core of what's going on between facebook and google, the latest moves were to acquire the autonomous drone companies, that the idea they have technology that lets them put drones up in the high atmosphere and provide internet services back down to earth. really what's the core of a lot of latest moves is they're going after the next billion of users in remote areas, developing countries, providing internet services, applications. that's their growth market essentially. and these small drone acquisitions are actually one of the ways they want to go after them. >> it could be drones, phones, who knows what the next big idea will be. but this can't be simplified. these are two companies that are at war with one another for valley domination, are they not? >> it's about valley domination. and that's been the story of the last ten years. you have the companies competing for engineers, competing in social network, google created google plus to compete with facebook. in fact, the war, you look at
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the whatsapp application by facebook, that's really about acquiring internet users outside the u.s. white the war is taking place in the valley, the real target, the real macro issue is developing market internet users. >> doc? >> kevin, first of all, love the site. i go to quartz every day. it's bookmashed on my page. folks, you should check it out. i try to retweet a lot of the cool stuff. but these guys, google and facebook, apple, these folks for the last decade, like you said, they've fought to take each other's folks, and yet they've colluded to not, mutual destruction, and now google going against facebook, trying to hold from them what will be valuable to them, like whatsapp and the way they paid for whatsapp, because google wanted to get it and keep it away from facebook, as another way facebook could dominate mobile.
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>> that is was the case with the drone acquisition, where what we've learned is that facebook, actually, was in talks to talk to titan, and facebook came in and said, whatever they're willing to pay, we'll pay more. there's a real chess -- a bunch of chess moves -- >> who do you think is behind of the four, five big players? >> yahoo! if you include yahoo! in that bunch, there's some questions about their ability to move revenue, and what will they invest in, what is the growth for yahoo!? i think that's a big question. i think google and facebook each -- this is an interesting chapter where it's hard to say who is ahead. partly because the bets they're making now, investors are indulging them in these massive bets in a lot of cases on markets that are not going to be material for a few more years. >> where's apple in all of this? is apple content to let the companies beat the heck out of each other, or are they going to
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have a say at the end of the day as to what happens there? >> it's unclear whether apple wants to get into this particular battle, which is a more fundamental battle for providing wireless access. the one interesting thing that we know that apple has, they have a store. they have the i types store. -- itunes store. $10 billion in revenue for the first time. we see amazon coming in with the phone. clearly, some of the logic there is they want to have a similar direct connection on devices to consumers. amazon's revenue last year was $75 billion, roughly. itunes alone was $10 billion. getting into that business in a serious way, or more seriously, is actually material for amazon. >> kevin, thanks. appreciate t kevin delaney. before we head to break, let's look auto what's on the rise amid a lot of red on the board. certainly the nasdaq, it's the utilities, once again, energy as well, joe was highlighting it earlier. if the pullback has you shaken, stick around.
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steve liesman is here with three reasons to believe in a spring snapback. falling rates and all. we'll be right back. make it happen with fidelity active trader pro. it's one more innovative reason serious investors are choosing fidelity. call or click to open your fidelity account today.
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zr. >> welcome back to the "halftime." a major breakthrough in the detroit bankruptcy case. the city and its largest group of retired police and firefighters reaching an agreement on pension cuts. under this agreement, these 6,000 retirees will receive no cuts to their current pension benefits and will receive at least some of the cost of living adjustments. so a foengs potentially a big d them. this is fort of the grand bargain being discussed in michigan where private donors kick in about $800 million to preserve the system. this agreement is potentially crucial in getting that city out
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of bankruptcy by later this year. negotiations ongoing with the other pension funds, the other unions, and other creditors. back to you. >> scott, thank you so much. scott cohn with the latest. we're finally heading into spring, but it's not just the weather looking better. steve liesman with details on the economy, whether it's seeing a spring snapback and what that could mean for the markets. welcome back. the drop in the ten-year means there's something out there, there is something lurking within the economy that suggests it might not be as good, or getting as good as we think. >> there is definitely a smell that's created by the ten-year that is not pleasant. it's not quite rancid. but the other smells are decidedly springlike, okay? we had an effervescent return -- i'm searching, struggling for metaphors, spring flowers, like a hyacinth kind of smell from claims, a variety of smells
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coming from the other data. the retail sales data, it's like taboo perfume. if you're a stock guy. no, they're taking the opposite. i want to put numbers to what joe was talking when. joe was talking earlier about the snapback. here's what the street is looking for according to the exclusive cnbc wrap it up debate, 160, 170 or so, lackluster. but then a rebound in the second quarter is looking like 330. with a range, by the way, joe lavorgna, 4.25. there's the numbers there. 4.2, his number there. look at the things that have done well. vehicle sales rebounded. a snapback like you would expect. retail sales came back. claims came back. attach your favorite springtime aroma to those numbers, and generally they smell pretty good. the market can sell off for whatever reasons, i can't find a reason in the data. there are global things that are going on, scott. you talked about those with rick.
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the ecb, maybe downward pressure. deflation, maybe downward pressure on it, it's hard to look at this data and say, you know what, there's reasons for the market -- for the bond market to smell something worse in terms of the growth. >> tomorrow, beige book. it's been an excellent indicator for what the fed will do. is that the template, the fed will pay attention, and should we all pay -- >> yeah, let me describe why it is. the fed takes the data, but also the beige book is a collection of economic anthos, so they go out and talk to people and they get a tenor of the economy from the beige book, and that could be influential. it doesn't do a bad job in saying where things are going. when they get pessimistic, the tenor is pessimistic, the economy is behind it. >> is there a level that will concern you as an economist that follows every move of the stock market. what would worry you? >> i have to follow the data. if the data says the economy is going to improve, i have to go with that. the theory of a snapback makes a lot of sense. >> lows of the day right now, by the way.
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>> the market's going to trade where the market's going to trade. i'm keeping my eye on the data, which tells me you should have a decent snapback in the second quarter. earnings follow growth, and it's about 50% of it, right? if earnings are -- if growth is up, then earnings will be up. you have to figure out what the other 50% is. >> steve, my pleasure. >> thanks. gold losing 2% for the worst session in many months. "futures now" host jackie deangelis. >> giving up one week of gain in one day. a pretty bad situation for bullion. but now, managing to hold above the 1,300 level which is key. brian, want to get your take. when you see the equities lower and people buying bonds, you think people would look for a flight to safety. it's not happening. what's up with the gold? >> no, it's not happening. the cpi doesn't help either. we're getting close to the 2%
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inflation target in the cpi, which is what the fed is watching, and maybe people, gold traders, starting to feet the printing press will start to turn off sooner rather than later. i think that's hurting it. it's like the yankees/cubs series coming up. greatness or awful? the stock market has been awful here the last couple of weeks, so i think it's inevitable that psychology will pick greatness, and use this as a gift and start to buy gold. >> anthony, the crisis in ukraine, tensions escalating. why isn't that impacting gold today? >> i think, jackie, when the u.k. drew that line in the sand that they would start an all-out force against the separatists, we were expecting that. we didn't get that yesterday. we got a much smaller situation going on. but the situation there is still fluid, and as brian said, along with that and the slide in equities, i still want to own gold at this point. >> all right. for more on bullion, check out the online show, we have a great debate today. we have gold bear paul krake versus the ultimate old bull,
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peter schiff, on the show. tune in for that. >> we'll be there. biotech enters bear market territory. the ibb is down nearly 3%. if you own some of the stocks, don't pachb don't panic. [ hypnotist ] you are feeling satisfied
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welcome back. biotech officially in bear market territory. the sector dropping nearly 22% since its february high. so should you bet on biotech despite that ugly drop? our next guest says, yes. dr. weber is the managing director of biotech at citi. he joins us now. welcome, doctor. good to have you on the show. >> great, thank you. >> i'm looking at my screen here. in terms of the damage we're seeing on the nasdaq today, if you look at gilead and celgene and biogen, are down 20%, from their march highs, officially in bear market territory.
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so what now for these names? >> yeah, that's a very good question. and if you look at the sector, the sector outperforms the nasdaq and s&p for six, seven years in a row, and we knew it wouldn't be sustainable forever. we've been talking about in we're in a biotech bubble for about six months or so. in small cap, things look stretched. large cap, though, is looking pretty attractive now versus the s&p. the stocks are growing 20%, 30%. and some of them you could buy 20 multiple, or as you noted, gilead about ten multiple and celgene 14. small cap is still looking expensive to us. >> any idea where the bottom is in some of the stocks? do you feel from your experience that we're getting somewhat close? >> you know, in october, we saw about an 8% correction in the sector, and at the time, it really felt like there's a lot of money on the sidelines, waiting to come in. we're not feeling that at this point, not yet. the sector's only down maybe 3%, 4%, 5% year to date, aligned
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with the nasdaq year to date, after being up by 15%, 20%. i don't think we're there. i think we're closer to the bottom on large cap, not so much on small cap. >> doctor, a quick question, i look at the names you're looking at in the big caps. what i don't see is amgen. i'm curious why. i look at the valuation, the late-stage pipeline, and yet that name is not in the top picks. >> well, amgen, we have a buy rating, more attractive than the s&p. it's giving you 10% eps growth. it's got a great pipeline. and we think it becomes a much more interesting stock if you look at their growth from 2016 onwards. we have it as a buy rating. we think there's better value and catalyst near term with celgene, biogen and gilead. >> i shy lighted a couple of the top picks. would you step in with a celgene that's down according to our newsdesk about 22% from the highs. you'd step into biogen, down 22%, and what is it, medvan?
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>> yeah, down about 35%. if you look at biogen, it's trading around 21 times, low 20s, and next year's number, we think growing 20%, 25% over the next three to four years. they're launching three new products this year. they have six other drugs they'll be releasing data, kind of midstage data from their pipeline this year. they're a leader in multiple sclerosis, and we think they'll beat numbers, so you have a kick cyclical story that we think is interesting. and celgene growing at 20%, 20 parse, and the reason it's 14-time ter another is because of a patent concern. we think they'll prevail on the patent battle. we'll start getting clarity midyear and a great pipeline on top of t both of those are actually very compelling. both on pipeline and sustainable growth. >> all right, doctor, thank you very much for joining us. from citi. >> all right. >> we can set up a debate if you will right here, as we talk
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about trading the things between the big, the small. >> right. >> we were actually debating between pharma and bio. on the pharma side, judge, i think pete's got the bold points on pharma. for me, on the bioagain, i end on the celgene side. there's so much potential, whether it's multiple sclerosis, non-hodgkin's lymphoma, those are reasons to be focused on the big, total addressable market, rather than over on some of the orphan drugs and so forth. so biotech, love it on this correction. i don't hate it. >> here's where you're losing me. >> okay. >> at the top of the show, we're talking about you should be shorting some of the momentum names. >> rather than buying them, yes. >> okay. you're talking about buying -- i would consider -- >> i'm talking about -- >> gilead and celgene, the momentum -- >> but the valuations are different.
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they're much different between large cap biotech and small cap biotech, and if you look at the social media, you can't even use p/e on a facebook. >> because there's no "e." >> right. and there's no such thing as gilead, celgene, they do have the earnings. a pipeline. you have to get do the day where the stocks end up. we have seen this entire high flier contingent, they start up and end down really bad. look at facebook today. a perfect example. we've got to get stability, and then you get did zsh scott, the biotech names are great names. here's the difference in today's market, ten years later in the big pharma world. they trade like -- they have biotechnology within their space. they have great drug development. and when you look at the aggressive moves to get into the emerging markets, from pfizer, from merck, from lily, from all of the big-cam pharma names, you have a growth perspective now they didn't have before, because the focus now is on some of the emerging markets. >> you have your choice between
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a celgene and gilead, between those two and merck or pfizer you're taking merck or pfizer over them in. >> for two and a half years or more, i have owned stocks like merck, lily, pfizer, bristol-myers, you name it. and i continue to like these names better because, yes, i'm not getting as much of the volatility and some of the spikes you see in the other name, but they're outperforming. you can lay on strategies. plus 2.5%, 3%. >> pete, what about the valuation -- >> we've got to do. >> but the forward p/es, they're very nice. are 12 to 16 p/es on most of the big companies. >> all right. we've got to do. we're coming back. mike mayo last month joined the half, he was fire up about citi. >> who will be held accountable at citigroup? >> that's not all he said, and with the bank's first quarter in the books and no major sea sweep changes, what does mike mayo
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think now? you'll hear from him next. to relieve my pain. this is humira helping me lay the groundwork. this is humira helping to protect my joints from further damage. doctors have been prescribing humira for ten years. humira works by targeting and helping to block a specific source of inflammation that contributes to ra symptoms. humira is proven to help relieve pain and stop further joint damage in many adults. humira can lower your ability to fight infections, including tuberculosis. serious, sometimes fatal events, such as infections, lymphoma, or other types of cancer, have happened. blood, liver and nervous system problems, serious allergic reactions, and new or worsening heart failure have occurred. before starting humira, your doctor should test you for tb. ask your doctor if you live in or have been to a region
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in the markets. the nasdaq getting closer to a 10% correction. are stocks on course for that big correction? many are expecting, or is a spring snapback ahead? we'll talk about ways to play the market right now. the tech giants, intel and yahoo! getting ready to report their earnings. the stocks have been slammed over the past week. we'll tell you what investors need to know ahead of the reports. and it is, of course, tax day. millions filing their returns, but many will find out their i.d.s have been stolen. somebody else has already filed a return and claimed their refund. how bad it's getting, scott, and the "halftime" team, will be right back after this. ♪
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welcome back. we want to show you the markets here. show you the market. fresh session lows being put on the books. there's the dow down 93 points. keep an eye on the nasdaq. that's where the damage continues to be done, down 1.6%, 3955, a key level there. 3934, only about 20 points or so away from an official correction. had two that year. none since. will we have another one? that's the big question facing investors. how about a bit of green today. where is it? there it is. in citi, of all places, up 0.3.
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it's baseball season, three strikes you're out. i think the cfo needs to go -- citigroup needs to change the cfo, bottom line. citi is coming off earnings, what does mike mayo think now? that's the $64,000. what's the answer? >> ceo reassured yesterday that restructured story for the next two years, the controlling costs, rolling off the legacy assets, using the tax credits. they reaffirmed efficiency targets, that takes some pressure off, but i did not get all of my answers. >> you don't get answers, you asked seven questions. i have the transcript in front of me. the operator says next questions comes from the line of mike mayo, for where you say, hi, re89ed to c-car, who is accountable for the failed
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stress test. >> i got half my answer and half i didn't. half the answer i got is the ceo is accountable. what does that mean? what are the consequences. safe for now, but if the citi fails the fed's stress test, then there's the question of the ceo's job. that's what the ceo has done here. i'm still going to the 578 meeting a week from today to ask not only management but the board, the chairman and rest of the board of directors, why were they so surprised? and what are the consequence from their perspective? >> i'm sure they'll by waiting with coffee and doughnuts for you, mike. you separate the argument of what's taking place in the c-suite to wall street, and the stock standpoint. you like the stock, you have a buy rating. >> i'm a definite buyer. don't forget the stock is down
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90%. they are a unique restructuring story, in an industry with serious revenue head did not winds. revenue so year to date, they were down 8% year over year for jpmorgan. you key is you need to have another lever to pull. citi had several levers to pull, even if they're not going as far as i think they should. >> do you think it's the canary in the coal mine? >> just talk emerging markets more generally. the stock sold off earlier in the year due to emerging market concerns, so despite all the concerns about citi, can they manage emerging markets okay, this was a good quarter for them. they could absorb the loss, it's definitely a black eye. i do they they should put on the table of ipo'ing that part, or potential selling it. that's the sort of action i would like them to at least consider more. that will be one question i ask next tuesday. >> what's your rating on
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jpmorgan? >> jpmorgan, like i've said several times, i still think it's dead money, but who is the c ceo? and what have they do to jamie dimon? have you read the ceo letter? it's a love letter to regulators. jamie dimon is saying regulation is good, it's making the system stronger, they want to be the model citizen, and then he said -- >> what's his alternative? >> that's it. big brother banking, either suffer or submit. jamie dimon has submitted. they're derisking, deleveraging, down 8% year or year. i would go into citigroup. >> good to see you again. >> thanks for having me. >> mike nay i don't. still ahead, final trades and much more on the sell-off. we'll be right back. we asked people a question,
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how much money do you think you'll need when you retire? then we gave each person a ribbon to show how many years that amount might last. i was trying to, like, pull it a little further. [ woman ] got me to 70 years old. i'm going to have to rethink this thing. it's hard to imagine how much we'll need for a retirement that could last 30 years or more. so maybe we need to approach things differently, if we want to be ready for a longer retirement. ♪ how did edward jones get so big? let me just put this away. ♪ could you teach our kids that trick? [ male announcer ] by not acting that way. it's how edward jones makes sense of investing. ittoday is tuesdaynes today, we greet you. treat you. care for you. today, you can come to cleveland clinic for anything, everything
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my individual health profile, not random statistics. they even reward me for addressing my health risks. so i'm doing fine... but she's still gonna give me a heart attack. innovations that work for you. that's health in numbers. unitedhealthcare. all right. welcome back. we want to show you the markets.
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we've been around the lows for the day. the nasdaq is getting dangerously close to that official correction level. about 20 points away. i'm looking over my shoulder. i see many names on the nasdaq 100 leading the decline, too. it's wynn, tesla, netflix, facebook. >> let's not pretend my favorite apple is trading well, because it's not. >> starbucks down almost 2%, so the selling in some of these names is not just the momentum names. some of the high-flying social names. some of the biotechs. you do have the outliers. >> everyone keeping talking about a rotation. i respectfully disagree. we're not seeing a rotation. utilities are rallying, because it's considered defensive. i think that's what's going on. >> i heard someone on twitter say the value tech, the old tech
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names we keep talking about, in terms of there being a rotation is one of the most crowded trades on the street now, the so-called value tech. >> we addressed yesterday the fact we felt that goldman sachs on that call was a little late to the party. these stocks didn't just start moving in the rotation. they were moving into the rotation and have continued to the up side as the rest have sort of sold out. you look at microsoft near 40, it seems like there's still some up side, but it's limited, for sure. >> i would keep your eye on the ten-year as well. we talked about it a lot on this program. >> i say 25. i'm not saying i'm smarter than rick, but 255 is a line we've been looking at all year. >> if you look like you're going to break 260, you may have more pain in the market. there's a belief that there's something in the economy that people haven't seen. it's almost across the board.
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let's do some final trades. >> stephanie? >> you have cash. >> is that your final trade? >> no, i like express scrips, it's on sale. >> doc. >> norfolk southern, running with buffett. >> valero is going higher. >> upl, natural gas. have a great rest of the day. that's all for us. power starts now. halftime is over. "power lunch" and the second half of the trading day starts right now. >> it's going to be an interesting afternoon. volatile day for the markets. nasdaq just shy of that 10% correction level. are stocks on course for that big correction that many are expecting? or is a spring snap-back in the cards? we're also going to rethink the 20-year ceo. report that jeff immelt trying to shorten his stay. is it good for a company to have a ceo stay so long?


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