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tv   Fast Money Halftime Report  CNBC  April 15, 2016 12:00pm-1:01pm EDT

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silent. a lot of people that go to movies already do this. >> they definitely got themselves caught in a fierce backlash. meanwhile my favorite stab of the day, no 52 week lows on the nyse yesterday for the first time since 2012. amazing as some of these energy names had finally come off. let's get back to post 9, simon and the half. >> welcome, our top trade this hour, oil in the spotlight. crude coming under pressure. oil major producing countries meeting sunday. the burning. i think it's important to point out that from the february lows
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oil has come up, what, 30%? we're above $40 as we go into this. and it's the bigger picture. >> it definitely has been a big increase here and certainly a risk premium on the table. we are a little bit lower today coming from the headlines that the iranians are not sending their oil minister. you need an accord and if they're not sending their top guy that could be a problem. having said that. our exclusive survey finding that 56% of the people that responded think there is more than a 50% chance that some deal is on the table but the majority don't think we go that much higher from here. but most of our respondents think that that, in fact, was
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the bottom for oil prices. what can we expect in the second half? they said 40 to $50 brent and wti will finish the year and that is drirget from where a lot of the street view is now. people are talking about 50 to 60, 60 to 70. some people even saying $85. who is holding all cards here. it's saudi arabia most certainly because they have a bigger interest here when it comes to negotiations with iran. it's not just about oil prices but regional stability in the area and they made it clear they want to keep market share. back to you. >> we'll see what happens for the moment: john what do you think will happen on sunday? >> it will be a negative based on all my reads right here as bullish as i am. one of the things i'm not particularly bullish on is a cut coming. a reduction in production out of
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the summit. but i don't believe we will get that and absent that i see a host of puts being bought in a number of the really big names. bp, petrobras, noble, the xle itself. very large put buying in all of the contracts tells me that just as jackie deangelsless said people aren't betting on bullish outcomes. they're betting on bearish. >> it's going to be more of a process than an event anyway. >> keep in mind i don't think they ever held to what they said they were going to do since they started so cuts aren't on the table here. freezing production is on the table but they're all pumping full out so as you take a look at the u.s., we had energy 21.
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however, where the lows have been set which is $26 going back to january, i don't think there's a ton of risk in it. but what keeps me interested in the group and i think it will be a sell on the news, what keeps me interested is you have to focus on saudi arabia and the true cost of pulling oil out of the ground. it's not the 2, 3, $5 to pull it out. you have to add everything else in. with that as the backdrop they can only keep the strategy going for so long. >> i want to point out the iraqie oil minister re-signed last month. maybe we shouldn't read into who is attending as we would do at a normal stable developed country. >> down the road they would be
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in agreement but they're on their way there. expectations are low. nobody is expecting anything out of this but from there we'll see whether supply comes on. >> it's interesting that everybody is bearish. >> what we're not talking too much about here is the fact that they have become more efficient at their business and the break event price out in the midwest are well below $40 that should at least stabilize production in the u.s. without seeing it go down and that should put downward pressure on prices. also as you start to look at possibly oil techniques, fracking, hydraulic fracturing around the world you will see more global supply. >> okay. let's see what happens.
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let's shift gears to financials. citigroup and goldman sachs on the spot lite this friday. city on the move after reporting better than expected results and that new story that goldman is continuing to make major cuts in it's cost base which has not been denied to cnbc. wilfred frost joins us now. >> thank you very much eps coming in at $1.10 versus $1.3. the all important division is in line with forecasts though management said they're not confident yet that this was the worst quarter of the year but with oil above $40 the picture is improving. on the retail bank side in the u.s. the cfo said definitely seeing good activity in the economy and they saw year on year growth in loans for a first quarter for the first time since 2008.
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capital markets painted a similar picture. it's down 27% where as equities and fixed interest were doing a little bit better only down 13%. given the very tough headline environment one area that's been key for all banks this week has been expense management. the topic as you said back in the spotlight for goldman sachs today after a story emerged that they're planning big cost cuts. there's nothing new in that but the key though will be on head count it would underlie just how tough the revenue environment is in investment banking which of course makes up a bigger portion of the earnings for those two names reporting on tuesday and wednesday. either way great week for bank stocks in general. index up nearly 8% for the week
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as a whole. >> you own citigroup. >> i do. the reason i own it is its about 73% of tangible book value now that's a meaningful discount to its piers. the reason it had that is perceptions and value sheet is low quality. if you look at city holdings it's down to about 73 billion on the balance sheet and that's a low enough number that we should stop saying they have a bad balance sheet and see the stock price come back up toward tangible book value which would be a good 30% rise from here. >> i own city as well and it was a good quarter. so i'm staying there because i do also believe it is unwarranted. as a matter of fact ceos throughout the sector have done a phenomenal job.
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i would be hard pressed to think of a large bank where i haven't heard there's going to be job cuts. whether it's merrill or you just go through. cs has a training program where they're now telling the trainees and this is second hand information that overall they aren't going to get jobs. when you start cutting your training class that's the worst part. >> goldman, he always maintained that he would keep the international franchise because that was a bet in the future. we don't know if they're going to cut or what they're going to cut and whether it's just travel expenses but he always said that international franchise is worth it longer run in contrast to others. >> right and obviously he had a great connection in china and a lot of great friendships in china and really tried to exploit those and build the company toward that i don't think that's where you're going
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to see the cuts as far as with goldman. i think it will be head count cut but not in the international division as much. >> they're great. depending on market condition ifs the opportunity is shrunk they're going to pull back from it this will be no different i'm assuming plus if the opportunity shrunk elsewhere like in training, then they should cut. >> others are doing it. that's for sure. coming up on the halftime report. >> still ahead, getting two bullish calls on the street today. find out if our experts are ready to jumpack into the stock. the bats ipo is soaring today. is the electronic exchange a smart bet for your portfolio?
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we'll debate it and going global. >> delaware. >> from brazil to britain, the new -- ♪jake reese, "day to feel alive"♪ ♪jake reese, "day to feel alive"♪
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>> two bullish calls today.
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halftime report we're joined now by raymond james. he joins us live from st. petersburg, florida. welcome to the program. >> thanks, simon. >> so why the call. why are you so optimistic here. >> well, we're being opportunistic and taking advantage of the opportunity seagate made. there's an creasing level of enterprise workloads that are going into the cloud where there is a significant deployment of solid state drives that is occurring. so more deployments into the cloud is a good thing for memory layers that produce nan chips or in micron's case the upcoming 3d and we think the risk reward is quite impressive at this level. >> that will surprise a lot of people because for a long time this stock destroyed a lot of
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value for people and the dynamics are not new. the moving to cloud has been so well telegraphed and documented. why make that call now? why would that be the point at which it begins to rocket? >> well, so this is not for your average investor. this is a very volatile stock. our position is is that trading at .8 times book value you're pretty close to a bottom. we're in the down cycle. the risk reward is quite interesting. what makes this call different as we look in the next 6 to 12 months is there's a new clash of memory. so it will change the cost structure and solid state drives by as much as 25 or 30% making not only hard disk drives not very cost competitive but existing two dimensional nan flash drives so that's the key thing that we're saying here. this is the point where there
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could be a tipping point for the shares as we look into the next six months. because despite a small number of player and three players in this universe it's always been a commodity product and always will be and there's no difference now than before and you had a buy on it. obviously now you think it's a more compelling buy and any time you bought it over the last year and a half you lost money. >> right. so this is not for everybody. it is a commodity product and it will be next year and the year after that the issue is timing and the trade. if you bring the cost down by 25% you can increase the volume or the density of these chips. we're talking about displacement
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of hard disk drives and legacy two dimensional flash. this is a trading tun. it's not investable at this point in my opinion. it could have overtime but it is a commodity. >> we appreciate the advice. thank you for joining us. so, john. >> i liked a lot of the chips here simon. here said at the top of that that one of the reasons that he likes it is a relative valuation. same reason that jim likes city is why he likes this stock. on a relative valuation micron is cheap at $10.24 and 50 off a multiyear low so i don't disagree with him. i'm not in the stock right now but i'm looking to build a position. >> jim does disagree with you.
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>> i do. it's trading well below it and it has a lot to do with what steve said. this is a commodity business. i'd rather be in chips less commoditized so i'm talking about where you can see good upside with the samsung phones and apple as well as intel. >> and john is nodding as you work your way through that. >> a agree. if you look at the sectors it's completely out and there's so many cheap stocks that you can buy. why buy something that is cheap just because it's only cheap. buy something that has expanding margins and a long-term trajectory and theme that you might get wrong. >> well the management always missed. so they tell you one thing and underperform. he's right. this is not a trade for everyone because most people like to make
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money. >> coming up on the show, the electronic exchange ipo is surging today. plus can terry bring back the magic of macy's? there's at least two true believers in our quartet. we will debate it. as we head into the break here's a look at the best and worst performing stocks of the week. busy week on cnbc. thank you. imagine if the things you bought every day earned you miles to get to the places you really want to go. with the united mileageplus explorer card, you'll get a free checked bag, 2 united club passes... priority boarding... and 30,000 bonus miles. everything you need for an unforgettable vacation. the united mileageplus explorer card. imagine where it will take you.
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global markets making its second attempt at a trading debut today after of course it failed in it's initial public offering back in 2012. bob joins us now from the floor. bob just remind us what happened here. four years ago they tried on their own system but it couldn't cope. >> yes. they had a trading glitch which we won't get into but the bottom line is they had to with draw the ipo and four years later they have finally opened the curse. they had a significant one but take a look at it intraday here.
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the important thing is trade talk, price talk priced at 19. opened at $22.88 and as you can see it's been straight lined right across the morning here. almost 12 million shares have changed hands so far. that's quite an impressive number. remember when they floated 13.3 million shares and they have upped that size of that offering as well. remember global markets founded in 2005 they are the second largest exchange they say for equities buying market share. they have about 21% of the equity volume. they are the largest exchange in terms of etf trading and of course we talked about that famous glitch in 2012 they are expanding into options and foreign exchange and also in equities as well as options and foreign exchange. remember something here, strong demand for ice, excuse me, for bats. that's certainly good news for all the other ipos in the wing.
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growth properties which owns a lot of big businesses in las vegas, a lot of properties. the facility company and a spin off of dell in the security area. the important thing is 120 ipos simon are waiting to go public. 15 filed privately so there is a huge number right ahead of us and hopefully bats opens the fw gates for them. >> about two dozen updated their financials recently. >> it means they're trying to get back in immediately. >> okay. thank you very much. on the bats ipo. john, a buyer here? >> no, i'm not. two reasons. we all know that you create that demand by having a very small supply. it was going to be an 11.2 million share offering, simon, it ended up being over 13 million shares so the fact that it makes this pop and they added 2 million shares to it are two
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reasons that i wouldn't be touching it here. >> i wouldn't touch it either. this is a great indication for the market. it's providing liquidity. it has a little fuel. but coming back a couple of years later there's going to be better quality down the road. >> it's a line of noes. nobody wants to get in here. >> it's a great company. they have been in business for ten years and they have 20% share in the u.s. they have their latest leading market share in europe. higher than i think both exchanges combined there. however to me it -- i woen call it as much a commodity company because it's very technology based but i have to watch it mature a little bit as a public company. it's nothing against the company but it's more the stock that i'm looking at. >> it does bode well for the overall markets though and this shows there are buyers out there so there's a lot of people questioning this rally and the markets overall to the extent that you can get this pop on an ipo and hopefully get further
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ipos coming out of the pipeline. >> but other ipos won't be this one. this one could not fail and could not break price. >> i'm sure that's not what they're saying behind closed doors to other executives. >> buying the stock though now on hopes of a turn around or is macy's effectively stuck in the bargain bin? we'll debate that ahead on cnbc. plus valeant is weighing it's options and investing legend bill miller unveil what is he is buying, a stock that he thinks will double. steve weiss will weigh in on a fallen angel. and as we go to break, let's have a look at the halftime portfolio leader board and the trades that have been made today.
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they found out who's been who? cking into our network. guess. i don't know, some kids in a basement? you watch too many movies. who? a small business in china. a business? they work nine to five. they take lunch hours. like a job? like a job. we tracked them. how did we do that? we have some new guys defending our network. new guys? well, they're not that new. they've been defending things for a long time. [ digital typewriting ]
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it's not just security. it's defense. bae systems. welcome back to the halftime report. melissa lee has our latest headlines. >> here's what's happening at this hour. the lower chamber of brazil's congress beginning a debate over whether to impeach rousseff.
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the process moves to the senate. the crucial vote is set for sunday. the city of boston marking the 3rd anniversary of the marathon bombings. placing a wreath at the sight of the second blast. three people were injured and -- three people were killed and 260 more injured in the he ploegss. ted cruz is joining becky quick, joe kernen and andrew ross sorkin this morning. among the topics discussed is minimum wage. >> i think minimum wage hurts the most vulnerable and it's within the state's constitutional authority to have a minimum wage. so they have the power to do it. i think it's bad policy. >> and yesterday we told you amc entertainment ceo was considering letting movie goers text in company movie theaters. today the company put out a statement saying there will be no texting at amc after getting a lot of negative feedback.
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the idea has been sent to the cutting room floor. that's the cnbc news update at this hour. back to you simon. >> they'll allow people to throw soda over one another in the future. thank you very much. macy's ceo joined us on squawk on the treat earlier and i asked him about how he was planning to turn around the stock's sluggish performance. here's what he had to say. >> we're going to maximize the opportunities with real estate but the most important thing that's going to drive our business our stock price is our business top line sales. we're very good at converting to bottom line. >> worth pointing out of course the stock is down about 40%. let's debate it. do you buy this turn around story? >> i do. >> we own it and we have owned it from 40% higher and we have been averaging down so we felt the pain but our belief is one you have a very strong
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management team. we believe they're going to reduce the stores this is not a pure real estate play. they're going to cut down the stores that aren't profitable and grow online and that is going to propel the stock in terms of top line margin growth you have a very strong balance sheet and you're not playing with a company that the overloaded with debt. >> i just wonder how many of those ideas were new and the stock still fell 40%. >> that's the risk you take. you do have value that if things don't workout there's other opportunities to do. >> it's a tough environment for many people out there. >> right. there's a host of folks in the retail space that haven't suffered through a dismal holiday shopping season, simon. terry is one of the best operators. we agree on the desk. my brother pete has been buying
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this one as of late. but it's also unusual option activity and institutional buying in this name. >> what we also asked is now that he has a new guy from the banking system in to advise him of the join ventures on property whether he would go through a full week spin off and he said yes. that door is still potentially open. let's say they did that. low probability. would that boost the stock or would it be a marginal effect do you think? >> i don't think it's a low probability. >> really? >> i'd love to hear the other guy's opinions too. i believe it is at least a 35 to 40% probability. >> that was before he had this gentleman. >> what would the stock do? would it be a huge move? >> it can recoop most of the 40% drop we're talking about. >> i'm on the other side of this from you guys and look this industry is really tough right now. we saw earlier this week that retail sales were dismal an it's
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been that way for months. further whatever retail sales are going on are online. you also know i'm in jpc penny and target. the momentum in the stock market and shoppers is very positive. i would wait to see macy's turn it around before i got into it. >> i think it's relatively safe holding here given the yield that should support it. it is a great management team but they're swimming upstream to a certain extent with so much going online and it appears consumer behavior changing from accumulating goods to more experiences so i think it's okay if you want to bet the management team that's a good bet to make. >> what are you seeing in the options? >> well we had unusual activity they pushed it out into august
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and buying the 14 cars. stock made a very nice move. up almost 10% today. pulled back a little. i was chasing and i'm only in the stock. took about half of it off on a very nice pop this morning. >> how long do you think you'll be in the stock for? >> i hope to get into the options as well. so if i get that and given that it's longer term buying out in august i would probably be in this for up to a month. >> let's get to our trader blitz. >> first up making a bullish bet on the hairlines upgrading jet blue to overweight and southwest to equal weight. >> we have been bullish on the airlines you'll see them start raising prices again so i like this call. >> alibaba with a buy rating. >> following the play book doing food delivery now as well.
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recognizes some of the potential that there is going on. i doubt if jack is going to launch any rockets but i do think that the stock at some point here is going to be a major favorite of folks because of the recovery that you see in china and the people that want to reach those 1.4 billion people. they come in through this name. >> according to reuters valeant is working with investment banks on possible next steps. >> well, they have no choice. if debt got downgrade again today, what strikes me about this is so fascinating. some of the shareholders that owned it because it's going to be the world's best roll up story snou the world's greatest break up story. we're seeing the quickest build up and then knock it down that we have ever seen in history. i'm still saying away. caterpillar upgraded to buy at vertical research partners. >> stephanie also likes this.
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she put it in the halftime portfolio competition and i don't want to be a bear on every stock we talk about today but i'm bearish on this one and here's why. if you go to caterpillar's website they'll produce what the retail sales figures are from their network and every region for the past several months has been negative and not just a little negative. down double digits so if there's a turn around at work it hasn't happened yet. it's in the future and i need to see that turnaround before i invest in the stock. >> can i correct you? not past several months. past several years. >> you're absolutely right. >> you've not been bearish on everything. you own the retailers which are down. >> i feel like all the stocks getting thrown my way i have been negative on. >> john is winning out. >> okay. good. coming up on the program, our very own sarah travels far and wide to keep track of his investments. he just returned from london where he got an insiders look at his favorite auto stocks.
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what we learned next. as we go to break a look at the s&p sector heat map. the halftime report is back after this.
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>> sarah just got back from london where he was doing investigating on one of his top holdings. what did you learn? >> one of the interesting parts about the auto part suppliers is that the electronic content going into the cars, not the
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cars in 2020 but the cars today whether you're talking about the mid sized cars or large size is the electronic components are increasing by more than double digits so even if you don't think oem sales are going to grow the amount of content going into these cars and the partnership that the oems have with global oems is increasing and you're going to see increasing revenue and top line share as well as margin growth. >> how do you know that they have got the margin? >> one of the things that you see from 2010 from today is they increase their margins and if you look at the products going into the cars you're seeing more and more of those products and the backlog that delphi has increased it north of $20. >> are you bullish here? >> i think the auto suppliers are a good place to be but i like the oems much better so i see it at a 5% dividend yield. 6 times earnings. a lot of people are worried about peak auto sales but as long as you have strength in the labor market you should still
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see sales of autos picking up and i see the value in gm much more than i do in the auto parts suppliers. >> that's not the experience recently. that's not what the data is showing you, is it? >> except for the one last month, the month of march you had seen well above 17 million seasonal annual adjusted rates of sales for the past several months so one bad month in march. it wasn't even that bad. it was 16.5 million. so i'm not that worried about it. >> i don't disagree. we own gm too and ford. if you look at the multiple compression on the sessions, the auto sector is trading at 7 or 8 times the yields. they were trading at north of 15 multiples just 6 to 9 months ago. they are now trading at 11 to 12 times pes with solid balance sheets and growing dividends and i think opportunity for margin expansion. >> why do you think the market has it wrong then to price them that way? >> what happened is when china revalued you have this fear of a
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global recession. not just the u.s. and when you had that, these are stocks that have done so well in the past three years that momentum investors that were never in auto suppliers came out of it and now you're in a no man's land where it's not cheap enough for value and momentum people don want to get back into it so until they can prove top line growth that's where you'll be. >> tension building in brazil as the vote to impeach that country's president looms sunday. how the political drama is expected to play out and what the unrest in brazil means for your money next on cnbc. plus a huge list of earnings set to report next week. our experts are highlighting the key companies to watch and how to play them.
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at a time that works for you. even late at night, or on the weekend, if that's what you need. because you have enough to worry about. i did not see that coming. don't deal with disruptions. get better internet installed on your schedule. comcast business. built for business. one thing is for sure it is going to be a monumental weekend in brazil. the vote to impeach president rousseff will continue as planned after the supreme court rejected her bid to suspend that protest and there will be protests in the streets as well. seema mody joins us with the latest. >> thank you so much. here's what's happening right now. the lower house of parliament in brazil is currently in session discussing whether they should move the impeachment proceedings forward due to allegations that
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rousseff mishandled accounts and used funds from public banks to cover big budge gaps. the final vote is due sunday april 17th. if two third of the lower house vote in favor of an impeachment the vote moves to the center. the outcome of the senate could lead to rousseff immediately stepping down by mid may. the vp would then temporarily step in. now of course a political developments have really been a driving force behind brazilian assets. if you take a look, up by about 23% on hopes that rousseff will get ousted. it's been the rebound in commodities but also currently the best performing current sunny 2016 so a lot of moving parts here in the coming days, simon. >> thank you very much. for more on what an impeachment vote on sunday could mean for investors let's bring in the managing director and global
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strategist. what sort of impact do you think you can see here? >> i would say just judging by the behavior year to date the stock market is clearly cheering the prospect of rousseff impeachment and we're also seeing that to a degree in the currency as well but i think that the logic here goes something as follows. brazil is both a significant producer and consumer of energy. in fact more of a consumer and the long-term goal of the brazilian government has been to increase brazilian production and imports. if you get that impeachment it could help to liberalize and open up the brazilian energy sector. >> right. >> john. you're buying the etf here. >> yeah. i noted today we saw some very strong action tied to this vote
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in the house and somebody that made a lot of money on a bullish bet in brazil traded out of part of that today and put on something at a higher strikeout in may. so the ewz that i owned for the last several weeks are betting that that continues. my favorite kind of trade is where i see somebody that makes a big profit and instead of taking it off the table, they put it out at a higher strike going forward. that's just what they did. >> i'm still slightly struggling with the fact that brazil has a brutal recession going on. and still the stock market would rise. >> what they're looking for are reforms from new administration. if you get rid of the corruption, those reforms in the -- it has been corrupt. so, look, there has been a lot of advancement in the market. we saw the etf up 40%. i think it can go up higher. there is a pause. we look at india, it had the big move. and then we're sitting flat to slightly down.
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brazil probably the same. >> okay. tally, you like to convince us to invest in europe. >> yes. >> why? >> we think europe is a buy here. but in my report yesterday, i was pretty careful to highlight the financial sector as being at once the key risk and reward. so basically if financials don't work, the european stock market doesn't work. and -- >> that's a massive caveat. but the financials are under such pressure. even in italy where they had some sort of -- >> caveat either, i don't agree with that. well known that the european banks are pretty much a disaster. their stress tests were a joke versus stress tests here. only upside to the -- i wouldn't own them. but if you go out like the midcap regions, stay away from the major indices, you see growth. look at employment numbers every week and they're growing up. mid to high single digits. i agree with you on europe. >> hang on. the ecb has a meeting next week. let's say they're poised to go further into negative territory.
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despite the fact they try to pay off the banks, doesn't that destroy your net interest margins moving forward. isn't that the great fear? >> i don't like the banks. if you ask me short or long the banks? i say i don't want to be involved but i would rather be short than long. >> i think you're right about the pressure on net interest margins coming from negative interest rate policy. but i think what the market is underappreciating here is that euro area lending is actually growing. and the stocks are overreacting to the downside. we have loan growth to households and businesses above 1% now. that's a key in fundamental catalyst here. >> okay. we'll leave it there. thank you very much. >> thank you. coming up on the program, netflix set to report earnings on monday with stock up 26% in the past two months. is any good news priced in or the stock still a buy? more "halftime" after this. how was your commute? good. yours? good. xerox real time analytics make
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netflix gearing up to report earnings after the bell on
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monday. what can investors and binge watchers expect to hear from the company? julie boorstin joins us from l.a. with the details. >> netflix is expected to show record revenue and ongeeing international user growth, even as u.s. growth slows. biggest metric to watch is netflix's subscriber numbers, indicator of how netflix's investment in original content is helping it compete with new rivals. perhaps the most important subscriber number is the one that netflix forecast for the next quarter. ubs estimating that roughly 17 million u.s. subscribers will be impacted by this price in greece and 3% to 4% will cancel the service. netflix shares are down so far this year, but over 12 months the stock is still up over 60% and many analysts are bullish on
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netflix's growing assortment of original shows and the fact that it has lower prices than most rivals. the question is whether subscribers will bulk at the few dollars extra they will have to pay every month. >> thank you very much. what is the trade here? john? >> i put on a call spread, it is $100 odd stock, and i don't like buying those kinds of stocks. and holding them into an event like earnings. but i don't mind having a limited risk trade in the calls. so i have that because of some pretty strong activity in the stock. and the options. so i'm in as far as a limited risk trade to the upside. >> what fundamental view are you taking here? >> i'm thinking that as they announce this price increase, that we're rather than seeing people walk away from their subscriptions, i think very few people will. i think it is still incredibly popular and that this will be a catalyst for the stock to take
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that next leg higher. >> steve? >> i agree with that. i don't see people cutting their netflix subscription because of the price increase. the space got more competitive. i like the amazon viewing experience better than netflix, they can work near technology. >> why is that? i would have thought netflix to me appears like a technology that -- >> you would think so. on amazon, you hit the middle of the screen and pause it, fast-forward ten or 15 seconds, you don't have any of that on this. but having said that, there is still cord cutting going on it going to continue. so i think netflix is well positioned. i don't believe you buy any high beta stock in front of a quarter if you're there long-term, buy some in front and buy the rest after. >> okay. the markets meet on the course, closing up for the session. for the week, in three hours time, let's get the second half trades and we'll kick off, jim, with you. >> you got quite a few companies reporting next week, paying attention to the chip
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manufacturers, intel and qualcomm coming out. this will say a lot about the data center, enterprise spending for intel and the apple iphone system as far as qualcomm goeses. that's what i'm paying attention to. >> you bullish? >> very much so. >> what are you watching, steve? >> until further notice, still about the black gold, about oil. that's what has driven the market. the great news is we had massive inventory build yesterday, but let's see what happens into the close. >> do you fundamentally believe it is based here? >> i think -- tough to say. give or take, yes. >> interesting. sarah what are you watching? >> i'm watching a similar thing. don't want any uncertainty out of the meetings because if we can keep oil at a level of $30 and $40, the knockoff effects are much more positive. >> the downside is protected at the very least, don't do a deal. >> they're not pumping in any more. >> that's true.
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>> as long this as they don't s something -- >> xle, still on the puts, i'll own them into this meeting and i expect them to be a little bit bigger on monday. >> a pleasure, guys. thank you. john, sarat, steven and jim. that does it for the halftime report. "power lunch" begins now. >> don't go anywhere. stay tuned. we have a very big wall street power player about to join us. this is "power lunch." i'm melissa lee with michelle caruso-cabrera and bill griffith. >> hello, bill. >> welcome. >> what is this "power lunch" show? >> as if he didn't know. brian and tyler have the day off. quick check of the markets here. don't let the fractional moves today fool you. in the last two months, the dow is up 12.5%. same for the s&p 500. both indices less than 3% from all time highs. the nasdaq is up 15% in that same period. >>

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