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tv   Fast Money Halftime Report  CNBC  June 24, 2014 12:00pm-1:01pm EDT

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the roller coaster ride. he was smart and popular in the spring. now his mom won't talk to him. did you not watch that during that harrowing time? >> we had an up and down time then up again also. i try not to overly focus on it and try not to let it define me or define the company. we've got 80 million people that use zillow every month. if they have a great experience and they tell others about it, ten years from now the stock will be worth a lot more than it is today. >> thank you for coming by if for the hour. >> thank you for having me. that does it for us. back to headquarters, melissa and the half. >> welcome to the "fast money halftime report." i'm melissa lee in for scott cap n -- wapner. the hottest ipo of the week. we're tearing apart go pro to find the profits inside. social search. investors are making friends with facebook and groupon again. is it too late to get in? queen of thrones. what do graphic violence, strong sexual content and the queen of england all have in common? they're all part of our worst trade of the day. let's meet today's starting
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lineup. joe terranova, steve weiss, pete najarian, mike murphy and rebecca patterson joins us. we'll begin with a risk to the rally. it's been nearly three years since the dow and s&p had a correction. come play sensy is the word of the month. are investors getting too comfortable in their summer groove? what risks to the rally are you looking for? let's first start off with rebecca. what do you think? everybody is pointing to things like the vix at seven-year lows. low volumes on the excha innges >> there's always risk out there. the vix this low could be a sign that if there is some shock, we're going to get an outside short-term reaction. but in general, i think we're in a low vol regime. it's not unusual at this part of the economic cycle. we have a lot of liquidity still from central banks. and we have rate and inflation stability. at least for now. that might be the catalyst for this to change. but for the moment i think low volatility can persist. and i think equities, we're seeing data that suggest they can go higher. just looking at today. consumer confidence in home
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sales, just two more data points i think in a spring of data points telling us that the u.s. is healing. china's pmi that came out sunday, a stable china. a better u.s. better although in a relative sense, europe. i think equities should go higher. >> shouldn't we be worried we haven't seen a correction in, what, years at this point? can we continue the sort of meltup that we've seen? >> i think it's a grind hire not so much meltup. it's been working slowly up. i gave a speech in chicago last week to institutional investors. pensions. endowments. the only questions i got showed they weren't complacent. they're worried about it. they peppered me with what if this happens? what if that happens? i think that's more the norm than come play sensy despite the vix. there's still a wall of worry out there. there's still underparticipation in equities by a lot of retail investors and by hedge funds. take a look at their exposures, their nets are still running about 40% to 50%. not 60%.
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not 65%. i don't think there's complacency. i think a grind higher. >> i'm up against a big challenging debate against these two guys. you know the stock we're talking about. when you talk about the complacency for a second and you think about all the central bank involvement and extraordinary measures, extraordinary times. you agree, this is not extraordinary times anymore. and when you highlight low volatility and financial stability, does that speak to exactly the need for the central banks to remove the stimulus? >> oh, i think that's such a great debate. there's a triangle here. we have growth, inflation and central banks. if we think growth is normal, it's coming back, and inflation might be slow but rising, then central banks are wrong. if central banks are right, that means the market's reading something wrong on the growth/inflation mix. at some point in the future, we're going to figure out where in this trifecta we've misjudged. it could be a combination of things, frankly. i think the biggest risk, although this is more a couple
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years out than right now, is probably inflation. but -- and the central banks misjudging it. right? that we're behind the curve. but i don't think we're there yet. i don't think we're even close. i hope i didn't misspeak. i didn't mean to say i think markets are complacent. think the vix is low because of the economic regime we're in and it can stay low. i agree with you completely. i think a lot of our clients are nervous and we're overweight equities. we're happy to be overweight. but there is a wall of worry out there. think that's part of the reason ek wiquities can keep going up. people aren't overexposed to the asset class. >> can't everybody be right? >> kumbaya. >> in erm thes terms of centrald the consumer. you could be right now. the timing, how quickly rates rise, which i don't think is going to be because of inflation. i think it'll be because economic activity. >> that's the eye of the needle the fed is trying to thread. if they can get the timing exactly right so growth is improving slowly, inflation is rising but from low levels, if
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they can time everything perfectly and interest rates rise but not too quickly, not too slowly, maybe everyone is right in the end and equities can sustain some momentum for quite a long time. more than a normal cycle. >> rebecca, haven't they done that so far? >> yes. >> where we are right now with the tapering at this point in the market, i think one of the reasons, one of the tail winds behind pushing this market higher is the simple fact that everyone questioned, what's going to happen when the qe starts to come to an end? the tapering is out there. it's been out there. and guess what? it's working okay. there's been no end of the world. so i think kind of threading the eye of the needle is a great analogy. i think they're doing that. >> i think so far you're right. think there's still a lot of nervousness because what we're coming out of with quantitative easing is so unprecedented. so, so far, so good. but even that we've never lived through this before it's hard to feel a lot of conviction that we can keep moving smoothly ahead without any hiccups. >> meditating could help that. >> i do that a lot.
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mau makes me feel good. >> we see this rotation all the time. everybody was all enamored with the russell 2,000. when that started to break down that was going to push this market to the downside. it didn't. the reason it didn't is that actually self-adjusted. it dropped. then everybody was going into the big cap tech names. then just the big cap names themselves. there's been this rotation that's been going on in the marketplace that actually makes a whole lot of sense to me right now. when you look at the low volatility environment, this has allowed a lot of folks that are very sophisticated, that understand the markets, to be able to protect themselves, to be able to stay in these positions and ride this market to the upside. and start to take off some of those stocks and put on spreads to allow themselves to get a better run. >> you're comfortable all day long -- >> 100% comfortable. i've got all kinds of exposure out there. a lot of that is hedged. because of that the risk/reward is right there for everybody. >> we want to talk about housing. rebecca, we want you to stick around. get your view. new home sales, of course, case-shiller home prices released this morning. over to cnbc's diana olick with the latest on this. >> reporter: it isn't rocket science. look, people buy houses when they can afford to buy houses.
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the big price jumps we've seen are finally beginning to moderate. boom. sales suddenly rise. take a look. a big drop in the annual gains on the s&p case-shiller home price index. both the top ten, top 20 city composites up 10.8% in april from a year ago. those were up well over 12% annually in march. remember, this is a three-month running average going back two months. so you're really looking at winter prices. but did we see that pop in existing home sales in may based on contracts in march and april? there you go. we did. jump to new home sales. reported today for may. these are contracts, not closings. so people out shopping and signing in may. up a whopping 18.6% month to month. up nearly 17% from a year ago. time for some perspective, people. this sales pace is still down 64% from its peak in 2005. so let's remember where we began. right? and important to note, on the median price of those sales in may for new homes, up 7% year
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over year. the biggest percentage sales increase was in the 400 k to 499 k range. about twice the median price of a newly built home. builders are going after the higher end buyers. again, you've got to look at this low base we're looking at when we talk about 18% monthly jumps. things are better. but not quite that much. >> diana, thanks so much for that. i think that's a great perspective diana brings back in terms of the percent from the peak. at the same time, rebecca, for you to be an investor in housing doesn't that not matter? it only matters for data points we're seeing now ahead of us? >> yeah. data points looking ahead are good. pending home sales a great indicator to look for actual home sales. architectural buildings. more nonresidential than residential. architectural buildings tend to be a leading indicator 12 to 18 months ahead. those are still suggesting we have a lot of positive momentum in construction more broadly. i think whether you're looking at specifically residential housing or just construction more broadly there's still a
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very positive outlook despite financial players getting out of the game. >> i think mike, myself and pete have been talking about this the last couple of weeks. everyone, it's a binary call on housing. you either love housing, you hate housing. that's not the case right now. it's moderated the rate of the r rebound. it's still in good condition. the short xhb trade we don't like, i don't agree with that right now. i'd rather go second derivative to an lpx in armstrong world industries doing well. lowe's doing well again today. there's stability in housing. think real quick, okay. unemployment rate is going to come down. it's going to go towards 5.5%. that's a good condition overall. we've seen the cost of capital get so much cheaper. that benefits the buyers. >> if you're not a believer in the single family story, if you believe people are renting and not buying, there's a trade in that as well. there's construction of apartment buildings. there, of course, are the apartment reits. >> look at numbers we got out today. up 18%. are we at 2005 levels?
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no. not even close. i think there's room for both, right. maybe more people are renting right now. but that doesn't mean that these home builders aren't managing their portfolios properly. buying land at the right time. building in the right areas. i think housing as a whole as the economy improves, i believe it's definitely taking housing with it. >> but you're never going to see 2005 again. financing is just too tough. too tight. >> we don't need to. we don't need to see 2005 again, right? we don't need to see it in order for it to still be a winning trade. >> right. but the other issue is that in terms of employment growth, you still have the separation of the two classes. >> agreed. >> and you're seeing so many people that are never going to be fully employed again. so many people that are going to be part-time employees and they'll never be able to rent even the modicum of expensive or reasonable in price -- >> does that read you to a short xhb trade? >> i wouldn't short it. >> manage your expectations. >> we've got to take a break, guys. rebecca will be back a little later in the show to reveal her play book for the second half of
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the year. here's a hint. it's not in the u.s. coming up, with all the buzz around low volume, pete najarian has an announcement. don't listen to the chicken littles. he knows where the volume is going. he'll tell you how to play it. mike murphy pounding the table on micron after reporting strong results last night. he likes it even more. joe says he's ready to prove this play wrong. w-r-o w-r-o-n-g wrong. get ready to vote. if you want to get in on the gopro ipo, listen up. you could already have a play in your portfolio. we'll go live to silicon valley for a look at which companies are inside of gopro. that and much more ahead on "half." just take a closer look. it works how you want to work.
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the lack of volume in the market is a hot topic. but pete najarian says not to listen to all the chicken littles out there. he thinks he knows where all of that volume is going. pete, let me guess. options market. >> you know, and it really started when i started on the show back in "fast money" in 2007 in february. we started highlighting what's been going on in these markets and how much they've been growing to the upside.
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but if you look at a chart from 2006 to now presently, you look at the stock market volume itself, the u.s. stock market volume, you'll see that that has decreased about 60%. so a lot of the chicken littles out there continue to point to these charts and say, wow. look at this volume. that's the reason you can't believe in this rally. if that's the case, you've missed about a 700 point move in the s&p 500 since that time. as the volume hasn't confirmed for them. on the other hand, if you look at the options markets, since 2006, 8 million options per day were trading in 2006. by 2011, it was 18.1 million. now, we've calmed a little bit off of that. right now, 2014, we're running at a run rate of about 17.1 million per day. so that gives you a little idea. that's increased 100%. put a little perspective on that. each option contract represents 100 shares. that gives you a bit of a sense of just where the volumes have gone. the smart folks out there, the leon coopermans of the world,
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warren buffetts of the world, a lot of these folks, david teper, your good friend, a lot of these guys have gravitated towards these options markets. they're using them more and more. they've got a lot of different reasons why. obviously leverage is one of those. it's also a risk parameter trade as well. melissa, when you're looking around for volumes you can see those volumes exploding to the upside. it's what's so exciting about this industry and why the volume is not as big of an issue as everything wants to put it out there for. >> good to know. let's talk micron. releasing higher than expected guidance. after 40% gains so far this year, is there any more upside? let's debate it. before we do we want you to help decide the winner in realtime. logon to cnbc.com/vote. click on the trader you think is winning the debate. votes will display at the bottom of your screen in realtime. you can vote, by the way, as many times as you like. but only during the debate. let's get to it. mike is the bull. joe is bear. a buck 30 on the clock. >> micron had a phenomenal
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quarter last night. i don't think you can even poke a hole in this quarter. full disclosure, last week i ligenned up my position in micron. i put that back on this morning. this quarter was hands down a knock the ball out of the park. they're going to earn over $4 a share this year. they're on pace to come close to $5 a share next year. that's why the high on the street analysts went up to $50 a share this morning. the one thing people talk about with micron is it's a commodity. oh, it's a pricing issue. that is correct. and they have pricing on their side. but if you look at the nan side of the portfolio, pricing down over 40% year to date, when that picks up, i think micron is tearing right through 40. this stock is still a buy at these levels. >> i shouldn't have to spend that much time making the bear argument. >> except you're already losing. >> of course. there's such overwhelming bullish sentiment towards this. let's go -- immediately let's get it right out there. pete najarian has owned this since $1 or $2. hasn't gotten out all the way. he thinks it's going to 40. let's take pete out of the
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equation because he's been 100% right on this one. i tried to sell the stock at 16, mike. i bought it back at 18. haven't done anything since then. the i think the sentiment surrounding micron right now is so incredibly bullish. we've got so many people talking about it. some of these people don't even know what dram stands for or nand. you talk about capacity in pricing. on the dram side it is about priming right now. in china b with you're going so see coming back online more kposty. that's going to contract some of the pricing. >> unless demand is there to pick up. >> the 33% growth in 2013 that this stock is accelerating on on the dram pricing, you're not going to get anywhere near that. you're going to get 5% this year. 1% in the outer years. you're going to need more -- >> the gavel has come down. >> incredibly cheap. i'm saying it's already priced in. folks are saying buy more here. i disagree. >> we'll leave the voting open as we discuss this on the desk. pete, i want to go to you. you've been a micron bull.
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>> since two cents. >> since two cents. right. >> i was the specialist on this when i was on the options floor. >> do you agree there's too much bullish sentiment in this stock. >> no. >> gloming on here after a huge run this year? >> i don't think there's enough. i think there's a lot of late folks coming to this name finally that actually are starting to understand the story. if you look at the elpita acquisition, they stole that company. that puts them into a great position going forward. you look at the fact they are with apple as well. when you see that there's growth coming. by the way, i think in september apple might have some new products coming out there as well. those might be selling pretty nice. i think that feeds into this machine. >> that's not new news. >> it's not new news but it's not in the pricing yet. >> all right, guys. >> elpita is up 150%. >> you guys had your chance. steve weiss, quickly weigh in. >> here's what i think. there have been a couple industries that have been rejiggered, reweighted. one's airlines where they focused on keep capacity down. the other is this area.
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memory flash, some areas semi, where they kept the lid on capacity and realized that higher prices will make you more money. i think there's more momentum yet in both mu and sandisk. i'd still own it. >> we close the voting there. bull case won it by a hair. 53% of you out there sided with mike murphy. and the desk, by the way. >> that's a win. >> that is a win. >> well done. >> slam dunk, guys. let's hit our trader blitz. four trades on four stocks. walgreens in the red. let's talk about inversion. >> this is confusing. i've liked this stock for a long time. when you hear something like this, they take the 2016 goals and rip them up. you need to hear a little more. i'd lighten up on the position until you get some more commentary later in the summer from them about what's really going on. >> you wouldn't hold it because of the promise of inversion? barclay says $100 stock.
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>> i would lighten up on the long. i wouldn't sell it short. we've liked this for a long time. i think it's a good stock. i just would lighten up. >> elizabeth arden saying it will exit low return businesses to improve margins. murphy? >> the stock is getting hit on this news. rightfully so, i think. restructuring this company after the stock has taken an absolute bath. avo avon had a similar scenario. now elizabeth arden. >> teslaen o a run. up 15% over the last week. barclay says the auto company may miss it sales target for the quarter. pete? >> that's giving the stock a little pressure after the immense run over the last couple weeks. i think adam m jonas is probably the best in the field right now when it comes to tesla. that's who i listen to. morgan stanley analyst. he's very bullish on it. i remain bullish on it. we had activity the other day. july 255 calls. i think the stock is actually just pausing here before it goes higher. >> pete, the stock is only down .5%. it's actually pretty good price action given the enormous run.
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>> after this call when you listen to adam jonas, you can see all the reasons he's saying don't embrace right now. look forward. this is a very interesting company. >> let's talk navastar shares up. it struck an agreement with carl icahn. >> tesla, you need binoculars to look forward. that's huge. >> they're talking 2022s. >> i don't look that far over. navistar, the company shareholder rights plan. the big news is that carl icahn has been limited in erm thes of settlement terms of how many shares he could buy. couldn't buy any more. now he can. that's what got the stock going. the thought is, of course, carl is coming. is going to come strong. >> all right. still ahead, biotech is heating up. some names are really on fire today. but is the risk worth the potential reward on the sector? the second half of the trading year almost upon us. today we will reveal the final play in our second half series. that was a minor interruption. steve weiss is laying out his
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vertex up nearly 40%. ibb up more than 50% in the past year. is the risk in this trade worth the potential reward? or is the rally getting a little bit long in the tooth. we should be clear. it did have a severe pullback. from its lows, which is 211 or so intraday, it has had a big comeback. weiss? >> look, i kicked it out of the play book. i haven't sold it from my personal shares. >> you're half wrong. >> i'm half wrong. >> and you're half right. >> right where it's most important to me. my own pocket. here's the deal. right now you've got phase one companies that may stand no chance of having commercial drug
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selling at ridiculous valuation. they shouldn't sell any valuation. the index is up 30% on average over the last three years. that's sort of crazy. i'd say with big cap stocks, particularly if you're an individual investor there's no way you can do the work on small cap biotech, noncommercial. >> it's a vehicle for retail investors swell henl funds. we're talking mostly big cam holdings. >> top five holdings over 40% of the fund. i think that is a way you want -- if you're going to play it like steve said, you want to play it through that. you get the quality names in there. then you also get vertex is in the top ten holdings of the ibb. you get a little kicker in there as well with some of the smaller names. >> if you had to take a flyer on a smaller cap biotech, would you? through the options. you're limiting your risk. >> i absolutely would. because, well, that's -- that's the interesting part of it. man kind, for instance, one of these interesting names over the years. all of the sudden they're going to be releasing information on whether or not their drug on
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inhaleable insulin is going to be something that will be approved. >> that got crushed years ago. >> it's been up. it's been down. it's been up. it's been -- >> still down, like, 70%. >> it's doubled recently, though. come from five to ten, almost 11 now. >> founders really put a lot of money into the stock as well. it's why you play with the options. so you can control your risk and actually see what happens to the upside. >> would you rather, joe? would you rather biotech or health care? biotech meaning ibb or merck. pfizer. >> i would say a blend of both. i really would. i would say a blend of both. salex pharmaceutical. do you remember that from years ago? i got annihilated in that stock. that stock is now $125. i like the strategy that pete is recommending. that keeps you in the game. obviously i wasn't able to. >> speaking of options activity, pete, you saw some suspicious activity in vertex. >> if you look at may it averaged 3,400 contracts per day. total contracts per day. you go to yesterday.
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suddenly you see 16,000 contracts. now, the stock is trading $66 a share. they're buying the july 90 105 call spread. pay a couple bucks for this. that doubled over night. they're going up to the 90 vik. >> is that weekly or monthly. >> it's got to happen before the third friday in july. lo and behold we get that result. those options doubled in value. $600,000 trade to a it willle over $1.2 million trade. not so bad. they didn't have to put up all that capital. to buy 300,000 shares you'd have to put $16 million up. >> did you ride the coat tails? >> i did not. i missed it. >> they must know something. >> there's always you kick yourself. to joe's answer earlier, you're exactly right. for me right now, the only stocks for the most part in my portfolio that i truly own are pharmaceutical names. but certainly in the biotech space, i'll put on spreads all day long. >> if you look back at that
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trade on the vertex, so doubling your money in a stock that went up 50% overnight, would you see it in hindsight, obviously, a better way to structure that trade? >> well, i think they're taking a shot. because obviously no one knows what these primary inputs are going to reach. are they going to get there and all the rest of this. there's a legitimate shot. minimum risk. great reward. >> corn and wheat futures falling hard this week. what does that mean for food prices? jackie deangelis is at the nymex. >> good afternoon to you, melissa. as you said, crops getting burned this week. corn and wheat falling more than 2% in two sessions. wheat is actually at a four-month low. jeff killburg, what's behind the slide here? >> well, jackie, i'm going to date myself here with a trade in places reference. you didn't need to meet claire's beaks in a dimly lit garage to know they've been selling the life out of corn as well as wheat. look at corn. it's up nearly a dollar from early may due to favorable conditions. federal forecasts reiterate the fact there's going to be a
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record crop. nearly 14 billion bush els. we will see. i'm getting bullish along as it's hedged above 4.35. it should be a lot lower. it's not. >> a lot of people are worried about food inflation. with these prices coming down, does that take some of the concern off the table? >> it really does not. unfortunately. wouldn't it be great if lower corn prices meant we pay less for food? unfortunately corn is actually a smaller portion of the input to food than you might think. actually, the food that we buy at the grocery store. so it doesn't really help us. it really doesn't help the farmer. why is that? nearly as big an input is energy. include the energy the farmer has to spend to get the corn out of the ground. so unfortunately, this is not going to help those who are worried about food inflation. >> all right. for more on those prices, check out the online show. futuresnow.cnbc.com. we're also going to be speaking to canacore's chief equity
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strategist. he's got a less bullish perspective than you might think. 1:00 p.m. eastern. futuresnow.cnbc.com. we're going to unpack it, melissa. coming up, our worst trade of the day. the queen of england coming face to face with the brutal kingdoms on "game of thrones." pete najarian, pit boss, pointed out unusual things in 3-d systems. the stock took off. gopro set to debut this week. there is a chance you may already own a play on this name. we're busting open at gopro to reveal who's making money on the company already. that much and more ahead on "half."
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well, you'd be lining up to buy the gopro ipo. you may already own part of it. josh lipton is in san jose busting open a gopro for a look at what's inside. josh? >> melissa, let's get right into the guts of what makes a gopro tick. we took one apart.
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on the inside, we found chips from qualcomm, a sony image sensor. the one piece that really caught our attention, a chip from a little known company called omborella. market cap of about $900 million. take a look at this company's monster move in just the past 12 months. up over 90%. not only do they supply a chip for gopro, its other big client includes drop cam which, of course, was just bought by google's nest. certainly one stock to keep your eye on as go-pro gets ready to go public. back to you. >> josh lipton, thanks so much. let's trade some of these companies. pete weiss -- i mean, steve weiss, i want to go to you. what are you thoughts on ambarella. it's fascinating. we were shocked we all never heard of almost a billion dollar market cap company. >> it's interesting. they're the ones that really allow hd video through their chip. i looked at it, it's not an expensive stock at all despite
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the move it's had. the moves started to happen a couple weeks ago in terms of the gopro ipo. some of that's reflecting the stock. to the extent it's going to get a lot more eyeballs on it and doing work on it, i'm sure all the real tech guys, real geeks know about this. but the average investor and the arch institutional investor, this is foreign to them. as i said, it's not expensive. so it's worth looking at. i don't know if you want to buy it in this spike. you definitely want to do some work. >> at the same time, joe, i feel like we've been through this circus before. when we had the apple, when apple was making its run up to 700 you always wanted to trade apple components. that for a time worked. then it sort of fell apart. a lot of component makers like a qualcomm are so exposed to other companies. >> yeah. i agree with that. but, you know, steve is talking about ambarella. let's cite something. i'm watching the stock. stock is shooting up. >> it gained a percent while we were speaking. >> if you're buying the stock on steven's comments and you're not planning to hold it for a significant amount of time, it's
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completely foolish. this is a stock that you do want to hold. why? because exactly what steve's talking about fundamentally. they do have tail winds at their back. they're in a great space. they're being looked at by an intel, by a broad kom. that's their peer group. it's a stock that's a longer term holding. if you're stepping in understand that. >> can i get a realtime trade update? as we were speaking, it's now doubled. it's gained 2% while we were on the air. steve weiss, do you still hold on to this or do you think given this run that perhaps, perhaps the news is priced in? >> as i say, you don't buy it on the spike. you wait. but if i owned it, i'm not selling it if i believe in the future. why trigger a tax event and have to, you know, throw those gains away in terms of taxes? >> just to add on to that, melissa, if you look at this stock, put it a double top earlier this year and it's still trading down 10% year to date. so if you want to buy this thing like these guys are talking about it, if you believe in the
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fundamentals and see it as way to play gopro, you can do it. you're not necessarily overpaying for this thing right now. >> if you're intel and you're growing at 5% and you see a company that's got huge growth like this and you could buy it for next to nothing, you know, why wouldn't you take a look? >> all right. we should note again, this is a $900 million market cap company growing by the second. because it's gained about 2.5% or so since we've started talking about it just about five minutes ago. we do want to hit unusual activity. the one you mentioned yesterday. 3-d systems. it was up yesterday. up again today. what did you do with your position? >> took off half of it. we were talking about how long would you hold this. i said a couple days. these things went from 95 cents yesterday when they were purchased. stock trading around $55. to yesterday -- >> these are the weeklies. >> these are weekly options. expire friday. yesterday had a nice spike. i believe this is probably yesterday where they got all the way up to about $2.60 on the high end. i didn't sell it that high. got in over $2. instead of waiting and looking
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and trying to decide is there something left in this to go to the p side, took off half. i'm playing with the house's money. >> this by the way is why you've got to listen to pete and the unusual activity. >> 7,000 traded yesterday. 7,000. open interest was 1,000. gives you an idea. >> today you're looking at? >> 20th century. you can see it right here. this has been a very, very interesting trade. what's really -- if you go back to friday, we had unusual activity. we had a trader vote on friday. do you want to talk media or do you want to talk industrials? >> right. >> they picked industrials. it was a great choice. but media, they had had some buyers in here. the july 36 calls were very, very active. today what happened was they were selling july 34 calls. rolling up and getting themselves 161 days. now they've got these calls as well. traded for about $1.55. 10,000 of these trade. somebody wants a little bit of time. they think this stock is going to eventually test the upside which is the 52 week high. $36 a share. >> is this one you're in? >> i am in this name. i think it's going higher. coming up, we're almost halfway through the year. steve weiss is about to reveal his plan for the remainder of the year.
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his stock picks may surprise you. and rebecca patterson is back with her second half game plan as well. then, need a friend? some social media stocks are on a tear right now. we'll find out how the traders are playing it. that and much more ahead on "half." you probably know xerox as the company that's all about printing. but did you know we also support hospitals using electronic health records for more than 30 million patients? or that our software helps over 20 million smartphone users remotely configure e-mail every month? or how about processing nearly $5 billion in electronic toll payments a year? in fact, today's xerox is working in surprising ways to help companies simplify the way work gets done and life gets lived. with xerox, you're ready for real business. i'm spending too much time hiring and not enough time in my kitchen.
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coming up at the top of the hour, if you watched "power lunch" yesterday we told you to watch vertex pharmaceuticals. today as you know the stock up some 40%. what's next for the biotech? one of wall street's top analysts joins us to weigh in. shares of carnival. the ceo joins us. there are reports yahoo!'s ceo marissa myer overslept for a big meeting with top ad executives. apparently it's not the first time she's kept this waiting. we'll talk about what that means for yahoo!'s business coming up in just a few minutes. more "halftime" right after a very quick break. requires chalr business inside and out today. at cognizant, we help forward-looking companies run better and run different - to give your customers every reason to keep looking for you. so if you're ready to see opportunities and see them through, we say: let's get to work.
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because the future belongs to those who challenge the present.
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second half of the trading year is almost here. we've got one last trader playbook to reveal. >> -- like pete, i don't care about volumes. there's no room on the scorecard for volumes. did you make money? did you lose money? with correlations breaking down, that's going to be the result of rates rising. so i'd be short bonds at this point. i agree with joe on that. >> by shorting tlt? >> actually long tbf. he's long tbt which is the alternate. that's higher test. i don't play that because you can't recover your losses as quickly. also in terms of energy, i don't think the mideast conflict is
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going away. i think it's getting worse. iraq clearly is in just a state where you don't know what's going to happen there. i'm still staying long. hk. bottom line, i like financials. i've got citi. which will have a major settlement with new york state. that stock will balloon. and energy. then short bonds. that's my playbook. >> energy was in your playbook as well. are you playing the spread? >> nothing to do with ti. nothing to do with present. sticking domestically here in the u.s. maximizing, monetizing the assets. pxd, eog. i love what he's doing. we saved the best for last. i'm being serious. that's great. >> wow. what love. >> kind of creepy. >> it's not creepy. it's a compliment. it's what you should do. >> great. let's get to rebecca here who has her second half story. what is it, rebecca? >> we're staying overweight
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equities, underweight fixed income. we agree, we think rates will be rising alongside a better u.s. economy. in erm thes of regions with we've been overweight u.s. and developed europe over the last year. i think there's room to rise. but i thnk there's catchup possible in japan and emerging markets. emerging markets is still selection being key. country and company. in terms of japan, you know, over the next ten years i'm skeptical they make the turnaround. over the next year, perhaps you've got stabilization in china. recovery in the u.s. and europe. higher yields means higher dollar yen. good for japanese exporters. more boj action coming. i think cjapanese stocks can ply catchup. >> in terms of the middle east and energy, japan imports all of its oil. >> absolutely. that is the big risk to this view. if we got a sudden escalation and brent goes from 115 to 120 and stays there, that would be probably the biggest risk to this view. if that happens you're also going to get a stronger yen, i
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believe, as a safe haven currency. so you need to be very wary of that. keep an eye on the middle east. >> that's the biggest risk to the u.s. market, also. sustained spike in energy prices. >> absolutely. >> we've seen that before. >> so far it's not an issue, right? we haven't seen retail gasoline prices take a hit. consumer confidence definitely not. more more acceleration today, bi think over the summer, you definitely want to watch oil in the middle east. we've gotten overweight energy in our commodities portfolio, our portfolio manager got overweig overweight, adding more energy equity portfolio just as a hedge, and taken advantage of low volatility. >> either way, it's a unique story, because it's the ceo sold three companies, including put rho hawk. >> and you easel back in with another pick and saw you're right either way. >> they always a seem to make a policy mistake. are they about to make another one? they're talking about concerns
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about inflation, not given the markets what they want. >> if you look at headline inflation, it spiked over the last month or so, but that's largely because of the april tax hike, right? so that's a one-off effect that will go away pretty seen. you'll see inflation still below their target. i think the bank of japan is pushing the government to do more. once they see that, the boj will respond and do more. i think they'll have to. i think prime minister abe is doing the right thing. i think the good news for japanese stocks, it's no longer a given. you go back three months, everyone expected more boj action in june or july. it's no longer a consensus view. that means an upside surprise when the boj acts. that would be another catalyst to help lift japanese shares. >> rebecca, great to see you again. >> thank you, you too. let's get over todom chu for a social -- >> the order ones are on the move.
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groupon is pops 6% piper jaffray analysts are saying the deals on the site are expected to rise by 30% this year. remember, the stock has dropped 40% just in 2014 alone, so there's still a long ways to go. investors are also liking shares of facebook. stock is trading up, after gaining about 22%, 23% just this year alone. 172 billion, but remember we're still trying to get bag to the all-time high. melissa, back over to you. you're in facebook, credibility? >> in facebook. i think the oz price action is what i've been looking for. the stock will end the quarter at the highest level it's been for the entire quarter. if you look at a chart, i think fundamentally they're doing everything right, but putting aside the chart tells you the stock wants to make a run at. the dominator just mentioned, i think that's where facebook is heading. i said it back in january, this is a $75 stock this year, i
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still stand by that. >> this coins sides with the return of the momentum names. netflix, trip adviser, all those storings are up 14%, 15% over the past few weeks. >> and so what i still don't like is twitter, frankly. i think they're lost, they've been brought up from the lows because of this move back to momentum. i agree with murph on facebook, because it's really the only way to play that kind of social networking. linkedin is another way, i think that's much more overvalued. >> are you soccer fans? have you been watching? >> you're laughing. >> newborn soccer fan. >> but on twitter they have they pages where you can follow. i think that's a fascinatic way to sort of slice an area that you're interested in, and maybe that's a way to further monetize it. >> and everybody's been talking about been and the earn gaugement process as well. >> you can also track on twitter the islanders out of the playoffs already for next year.
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>> why is he being so mean to joe? one more trade and then we have to go. >> i want to talk about netflix. >> quick, quick. >> it's about to take out of the march highs. >> the buy on that is a good price. >> how could you fight against it? >> all right. final trades are up next on the half. plus houses a modern monarch is getting into "game of throne." the latest claim to the iron throne is up next. ♪ ♪ [ girl ] my mom, she makes underwater fans that are powered by the moon.
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♪ don't worry, game of thrones fans, we won't spoil anything, but today's worth trade comes
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from a new royal family laying claim to the iron throne. queen eliz biand prince philip visited the studio, and met some of the actors, but is it wise for these royals to try to take the iron throne, even if only for the day? and i have scorch fession to make. i have no interested in seeing this, and i'm ready for the twitter torrent that will come my way. >> it will. i'm current my daughters watch it, but i've watched four seasons, and there's seven kingdoms, the only one i figured out, and it took two episodes left, is tyrian is the little guy, peter dinkledge. >> you're a fan. >> you know what i like? >> the fact we're deferring to weiss for pop culture, that may be the worst trade of the day.
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forget about the other constitution. the worst trade is we are talking to steve about pop culture. can we vote on that? >> i usually make the trends, i don't follow them. >> do we have time for a market question? i've wanted to ask this all week. >> really quick. >> historically has the vix spent time specifically below 10? >> you've got to go back multiple years. way back. let's hit the final trades now. pete? >> intel. everybody says this thing is dead, the pc is done, the pcs done, intel is hitting 52-week highs, going higher. >> i think inflation is accelerating. tips. >> el paso. these guys control the pipelines, and they get over a 6% dividend. i like the way it's been trading. >> steven? >> tbf, as we talked about earlier, good economic data today, and nobody is talking
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about yields back up on the ten-year at 2.6. i think they go up higher. that does it for us. thanks for watching. see you at 5:00. we have the ceo of sun power. meantime, don't go anywhere. "power lunch" starts right now. halftime is over, "power lunch" and the second half of the trading day start right now. >> we told you to watch vertex pharmaceuticals yes. today, boom, the stock is up 40% on the trading session. now what else do you need to know about the stock that could soon poppy in biotech? one of wall street's top analysts weighs in in just about two minutes. yesterday vertex probably wasn't on your radar. today dubai probably isn't, but it should be. something is happening there that could have a big and very bad impact on global markets, and we are going to tell you all about it this hour. then we turn our sights to yahoo, is its ceo

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