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tv   Fast Money Halftime Report  CNBC  April 5, 2019 12:00pm-1:00pm EDT

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absolutely i'm not sure that i buy that it would be more addictive than drugs and alcohol. but we have had this debate before, whether it's gaming, whether it's smartphones, et cetera, and the role they play and how engrossed people get. >> market really hasn't budged in the last hour or two. we're going to watch to see what the afternoon brings for now, let's get to the judge. carl, thanks i'm scott wapner did goldilocks just deliver a big gift for investors what today's job report means. it's "the halftime report." >> announcer: did the jobs report and the slowdown in wage growth hit the market just right? the dow and s&p now less than 2% from all-time highs. will this lift stocks to the next level plus, the president's call is there any chance the fed will go along and holding the halftime investment committee's feet to the fire see where their picks hit and where they missed.
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"the halftime report" with scott wapner begins right now. >> welcome, good to have you with us on this friday here to debate the big stories of the day, josh, steve, liz, shannon, the chief investment officer and also with us today is jpmorgan's head of u.s. equity strategy. let's begin with the markets stocks are higher, following the mostly solid jobs report so does it now clear the way for stocks to continue their momentum josh, 50 points away now on the s&p. is this just what the doctor ordered? wage growth a little bit less, jobs good, what more do you want >> it's hard not to be objectively bullish here, but i could have said the same thing in september when the market had topped out you had really good breadth and then that started to fall apart. you had good economic data and that started falling apart, so i think it's important to just recognize that we're in a really good place right now, market-wise, a lot of the technicals that you would want
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to see look perfect. remember that run we had 11 negative consecutive closes in the transports and everyone said this is it, that's the canary not coal mine. now we're loabove those levels xpics, biotech, high risk appetite breaking out. semis at the march 2018 high take a look at emerging market equities now at the august 2018 high consumer discretionary, a hair away from a new high this is what you would want to see if you were already bullish, so let's just say we've had a really nice run. we've gotten through earnings season now we have the economic data starting to look better after what i told you a week ago was residual seasonality and -- but let's just recognize this could turn on a dime the moment somebody starts to get negative about something. >> okay so this does nothing to upset your thesis, 3,000 on the s&p, you're positive stocks, you reiterate that in a note just
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this week. so, new highs, here we come. >> yeah, we've been off a positive view the whole year and one thing i'll add to josh's comments versus september, positioning is substantially lower. a lot of the fast money community hedge funds have not been embracing and participating in this rally. when you look at data from different prime brokerages, even jpm data, we're in the bottom 20% since the beginning of 2018 so i would say positioning-wise, this rate could continue to the upside and the other thing is we did have a big pivot in the fed and policy which is turning a lot more accommodative and we are continuing to see progress on the trade side. >> do you think the -- or at least it seems like you thought the inverted yield curve was much ado about nothing, that it wasn't sending the kind of signals that some were suggesting it was. is that right? >> correct i mean, there's two things i would like to point out and we publish on this quite in depth after the first instance of inversion, historically the
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market tends to do just fine and and he couldly when you lo secondly when you look at robustness of this, it was quite weak >> the tricky part about this is, depending on your thesis, you can find the data to support it and that's tricky for investors and some of the stuff that you can say on the positive side, this is actually really interesting, so the 65-day price move in the s&p 500 is now in the 99th percentile. historically since 1950, the forward 6 to 12 months is then well above average so that would tell us that the rest of the year is actually going to be great. but then you look at some of the data, everything's slowing, the second quarter's looking like it's going to be harder than the first quarter. investors kind of throw up their hands, what do i do. you don't want to miss out on the rest of a rally. so what i would say for the rest of this year, though, probably a little bit of goldilocks i would maybe caveat that in the third and fourth quarter if the fed has to come back to the table. >> on that note, weiss, if you say by virtue of the jobs report today, lack of inflation, only
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underscores the story that the u.s. is the best, period, end of story. the risks that are out there, they're coming from elsewhere. brexit, elsewhere in the economies of europe, china, and other parts of asia perhaps. >> chinese stocks are up 20% this year. >> i get it but that's because they've been stimulating the economy. >> so have we. so have we we did the second biggest tax cut ever >> what's a bigger risk, our economy or china's >> i'll tell you after it happens. the reality is there will be a -- okay. >> what are the lottery numbers? i'll tell you after it happens >> look, there are huge risks out there but there always have been and sometimes we choose to react to them when it looks like one of them is about to manifest itself and sometimes we ignore them we're in a moment right now where sentiment is very good for whatever the reason might be, the stuff about china, and how much debt they've taken on and are they stimulating too much, it's just not impacting asset prices here. it's not even impacting asset prices there and as a matter of fact, msci
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just made the chinese component of their em indexes absolutely massive relative to what it was three years ago, so we have decided, as an investor class, not to obsess over the china risk will that come home to roost one day? i'm sure it will it has before. it's not a game ender when it happens. >> sure thing. here's the story you can't -- you can't just invest in the market and be ignorant of all risk, i'm not saying you are, but -- >> i am a little >> there are risks out there it's not all about looking back ward and looking at technicals and saying, okay, now we're love the 200 day moving average because every technician comes out and says, if we break this, i'm selling. >> my overall point is that the majority of the risks are not here at home it doesn't feel like it. >> and i agree with that the economic risks aren't here right now. we will go into, you know, declining earnings in the first quarter as the reports continue to come out. we all know that the question is, will they be
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worse than what's anticipated or will they not be as bad and what will the guidance be if you get the chinese deal, you will see analysts increase their estimates for the companies that are impacted by it but here's how i look at it. and mike wilson's notes say -- i agree with his numbers >> i was going to bring that up. we believe this will mark the beginning of an earnings recession, two or more quarters of flat or negative earnings growth >> right and i don't know if that's -- >> are we ignoring that? he says not a good entry point for stocks here. >> that's not the point i'm looking at here. we're not in a massive -- we're not stimulating massively in the u.s., right? we're still holding our head where we were when we tightened and the messages in december the only thing that's changed is that we're cutting back in terms of how we're going to take care of the balance sheet but here's my point the multiple has expanded. while earnings have gone down, the valuation in the market, just simple math, has increased so i don't know how much higher we can go at the end of the cycle. >> are we too expensive? >> i mean, from an -- it's not -- we're not seeing indications of being overbought at this level.
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however, i do think what's interesting is over the last five days or so, you've seen it strengthen in an area like financials which there should be no reason for financial stocks to be strong in this environment. >> they're just tracking rates rates tracked up a little bit so banks moved with them. if rates were to go down again, you bet your bottom dollar that banks would go down as well, won't they >> i have to argue with you a little bit we are actually still very stimtisti stimulative here in the united states we're less stimulative than we were two years ago but if you look at the backdrop from a historical perspective, we're stimulative here and the slowing that's occurred in europe and china has been on the back of an accommodative posture so i don't know how -- >> my point is not that we're not stimulative here but it hits a point of diminishing returns as we're seeing by the fact that earnings aren't continuing to explode, the fact that earnings are forecast to be down about 4% so, at some point, you say, you
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know, we've had these historically low rates for years now, for a decade, how much more demand can it drive? how much more demand to risk assets can it drive? that's my point. not that -- >> i think that's a good point >> when you put inflation at zero >> so much to get in >> on the valuation side, i would just add a lot of it is also relative, kwets versus bonds, the biggest narrative that was being put against equities last year was rates were moving higher, that's capping the multiple, rates just collapsed a lot. >> so where could the multiple go then? >> 17.5 or 18 turns on a basis >> dubravko, people underestimate how quickly we react to small changes in rates. i was blown away to see that new mortgage applications spiked 18% last week on the back of the ten year coming in and rates across the curve and mortgage rates coming in. and refis were up 39%. that's week over week, it's insanity that's a very, very fast reaction and then the other
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thing is, just this idea that we're not appreciating the risk coming from international. there's trillions of dollars in sovereign bonds now yielding negative that is the manifestation of us saying there are big risks to overseas economy that's literally how we're graffitiing the wall to say that we're worried. >> you misunderstood my point, i think. i'm not saying we're underestimating the risks coming from international i'm simply saying, the only real risks seem to be from the international. >> i feel you. i got it >> so you argue the point but it's the same point. it's one of the reasons why the u.s. seems to be the best place to be. you favor the u.s. over anywhere else, don't you? >> well, we're a positive u.s. and emerging markets >> but in terms of an allocation >> yes, u.s. has been -- >> hire an emerging over u.s. would you. >> we do >> what about this notion of -- we don't have to talk about mike wilson directly but the point of view of here comes the earnings
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recession, and how can you be so positive on stocks if we're going to have an earnings recession and it could last two quarters or more >> the fact is that earnings are facing a tough comparison versus last year where we sort of hit a high on top of the trade drags, on top of that, you did have a rollover in commodity prices which are also exerting head wind just because we're basically seeing one quarter of negative or contracting earnings, that doesn't mean that the stock market has to go down. we saw it at the beginning of 2016 and keep in mind stocks tend to move always 3 to 6 months ahead of all these rescissions so i would say if anything, expectations are quite low and for me, i don't think that this is an negative for the stock market stock market has priced it in. >> bring your thought, josh, about having more allocation outside the u.s. than in >> i think we're -- now, being overweight e.m. and being underweight u.s. is what i've been talking about and it's not a call on emerging markets have better economies because stock markets aren't the same thing as economies. it's just this idea that if you're investing for a 5 or 10
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year look ahead at a minimum, you want to own things that you've got a higher margin of safety, you're paying a lower valuation and that are, quite frankly, still despised so when you look at all the surveys from global portfolio managers, they're all still way overweight u.s., they're all still way underweight international and arguably that's been a good posture if we're investing in the rear view mirror but we're not. we can own stock markets trading at 9 or 10 times forward earnings where they've not been doing s doing stimulus for ten years, where the currency has become a head wind and could become a tail wind and i think when you allocate a portfolio it's never going to be an either/or it's not like, no, we don't like u.s., we like this it's, what can we do that's marginally more intelligent. >> to me, i don't like looking at it that way, that's nine times and we're ten times, 17 times. because the markets are
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constructed differently. forgetting about the fact -- >> we agree but it's 22 versus 11 and that's an all-time spread is that the right number >> can we get josh another cup of coffee? i don't think he's had enough today. but the accounting's very often opaque the regulatory agencies aren't as strong as they are in foreign markets. lots of reasons for discounts. and we always hear the differential between, oh, europe is so much cheaper than u.s. that's because that's financials in their index we're technology and growth. so, you've got to look at more than that. >> i don't think that's why people have shied away from international and e.m. stocks over the last couple years i think the fallacy has been you invest -- you invest internationally when the dollar is weak and if the dollar is strong, you move out of those. this creates an opportunity because we're not -- you don't need to trade on the dollar to find opportunities outside of the united states and you don't need to have a specific dollar view i think the dollar is going to still be supportive, but you know, apart from that, we're not
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banking our e.m. call on the directionality of the dollar >> so dubravko, your scenario, you mentioned the fed pivot. if stocks continue to go up and earnings trough in the first quarter and we get a pickup, doesn't that have the risk of bringing the fed back into the picture. >> i think it does but with a lag. if anything the fed is talking about this concept of average inflation targeting which means if inflation were to start to shoot higher, they probably would be comfortable letting it ride higher for sometime before they start to step on the pedal. even our economists for this year are expecting zero rate hikes. >> let's continue this conversation about what could happen with the fed. the president once again attacking the federal reserve today saying it could cut rates and even embark on another round of quantitative easing steve leishman is here greatest economy, economy's doing great, we need to cut rates. >> right >> and -- and -- >> buy more bonds. >> quantitative easing >> here's the deal, scott.
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the u.s. economy is doing about average when it comes to the speed with which it's doing its mile around the track. however, if it had open heart surgery, it could go even faster >> what do you mean? >> this is an emergency measure that he's calling for. >> generally -- >> at a time -- >> he's not serious. he's just speaking extemporaneously he's not saying this is my policy he's like ted cruz's dad might have killed jfk. he's not serious >> let's listen to what the president said on his way out to california >> i personally think the fed should drop rates. i think they really slowed us down, there's no inflation i would say in terms of quantitative tightening, it should actually now be quantitative easing, very little if any inflation and i think they should drop rates and they should get rid of quantitative tightening you would see a rocket ship.
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despite that, we're doing very well >> so, let me ask it this way. how much risk, if any, do you see from this now mushrooming battle between the president and the fed? >> if this scenario plays out, let's say the fed cuts rates and, you know, does qe, stock market is going to balloon even more it's just going to shoot right up now, yes, we'll feel repercussions at a later point but the initial reaction is going to be uber bullish >> you think so? i feel like qe has proven only to be deflationary or disinflationary. >> i think it's basically going to inject liquidity into the system and blow out the multiple even higher. >> keep in mind your perspective is that there's no alternative to investing in equities, because rates are so low so, what you're saying is feeds into that even more, forgetting about whether it's stimulative to the economy or more, you're going to invest in ten year with
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a 2% coupon. >> i don't think this is going to happen. i don't think they're going to cut rates. you have powell all the time saying we're data dependent. there's nothing telling him he needs to cut rates i think that's off the table but i do think there is a good risk of a policy mistake later this year. and if the u.s. surprises to the upside, i mean, earnings expectations are so low, probably too low so i would agree and we're too low, we could overshoot on earnings, overshoot on growth, if there's some inflation that comes back in, i mean, wage growth is healthy. the fed does have to -- >> what's your basis for saying there's a big risk whatever you term -- >> a policy mistake. >> what's your basis for saying that >> if he continues to say we're data dependent and we do overshoot on growth numbers and earnings numbers and it bakes through the economy and we see some inflation lift, that's also assuming china's stimulus is effective and europe stabilizes, china stabilizes, then data's going to tell him it's time to raise rates. the economy's healthy. >> if inflation's picking up,
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how is that a policy mistake >> the market would see it as a mistake because right now the market is pricing in a cut >> so, any hiem is a mistake then >> what you're both saying could be true. well, to your point, by virtue of even having this conversation, the president advocating the way he is, it would suggest that in their eyes, you can only have a strong economy with incredibly low interest rates >> that was like watching -- you ever see "being there" with peter sellers, quantitative tightening, quantitative easing. >> i get it but it's not just the president arguing for lower interest rates >> the best economies we've ever had have accompanied rising -- let me repeat this -- the best economies in the history of america have been accompanied by rising rates the 1950s were arguably the best decade for growth, rates rose consistently the 1980s and '90s were not necessarily all one way on rates but most of the '90s -- >> you're right. >> by the way -- >> it's always different but i'm making the point
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>> i got it. >> you don't need zero percent interest rates and qe and a lot of the period of qe that we had in the early part of this decade was a bad economy. >> hold on >> good. >> gosh. showing you the wall that we made to show you sort of the progression of what the president has said about the economy leading up to today. which was in a minute of each other how the country's doing unbelievably well yet the fed should be quantitative easing. i just wonder what if this -- what if this goes a step further? what if you continue to march towards an election and the president tries to fire powell, whether he can or he can't, what if he tries to do that >> it's already gone a step farther and i'm a little surprised at the conversation around the table here thinking this is all quite to benign. let's be clear >> i'm asking whether -- >> the federal reserve was on a track to continue reducing the balance sheet well into next year they've stopped that
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they stopped that because the markets sold off or because they got criticism from the president. the federal reserve was going to hike rates several times this year they stopped that. did they stop that because of the markets or the president the president now is considering two explicitly political supporters to the federal reserve board. comments today from barclay's saying they're worried about e politicization of monetary views. this would be a quantum change in the making of monetary policy at the world's foremost center >> what we've learned, though -- >> the idea that this is benign, josh -- >> i'm not saying it's benign. >> you just said it's a joke >> it is a joke because he said yesterday he's going to close the border with mexico and he said there's going to be a ban of muslims coming into the country. not every off the cuff remark -- >> and then he passes the law. >> and what happened >> well, it got overturned in the court. >> i don't think that's -- >> so look, statements will be made we can't run around screaming
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every time he says -- he clearly doesn't care what he says. >> other people have opinions on this desk. thank you. ladies, liz. >> go ahead. >> okay. you can go first but i think, first of all, i completely agree, it's not benign and i recognize the fact that we've had a slowdown in economic data, we've had a slowdown around the globe, but i disagree slightly that the only risks we have are outside. i mean, i think we do have risks here however, we're still insulated for the most part as an economy, so this trade war thing, i mean, the trade war, if we want to talk about that for a minute, this is like the world's longest job interview. we've had preliminary phases, everybody says it's going well, we're back, maybe we get an offer, and now we've rescinded or we've said, you know, we don't like the terms of the offer and it's just going back and forth and back and forth the market's going up based on expectation, not on actual events we need some of those events to happen >> and the trade war is not benign either. >> agreed. >> who knows what's responsible for the global slowdown but there are people who say that
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the global slowdown is caused by the displacement of hundreds of billions of dollars of global trade created by the largest set of tariffs put in place since the 1930s. >> i think that the reality is here, we think about where we are in the cycle and we look at a traditional market economics and a traditional economic cycle, we're nine quarters into below structural unemployment, we have inflation which technically -- weren't we looking for inflation? isn't that what we're supposed to be looking for? do we want to be a deflationary environment like europe? what we should be looking for is the concern that i have to steve's point is that during a period where we're entering the end of an economic cycle, the fed should be able to act accordingly as they have historically if they do not act as they have historically, expectations of investors will be turned upside down and i think that's what creates the next exodus from capital from the equity market >> i'm trying to figure out sort of what level of risk, if any, resides within this sort of
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rhetoric aimed at the fed, in a good economic environment. wait until you get a little bit closer to the election and god forbid the economy takes a really dramatic turn negative, no one hopes that it does, but if it does, don't you think that the rhetoric is going to even get worse? if not the suggestion that the president is going to attempt to fire the head of the federal reserve. >> i don't know what he's going to do, but you know, it's plausible. >> are you thinking about that >> of course it's one of the risks we've seen some of those types of episodes play out over the last, you know, two years or so. but i think what they're trying to do is trying to make sure that doesn't happen, that the economy stays on strong footing. >> dubravko, can i interrupt for a second i really want -- because when you say you're thinking about the firing of the fed chairman, is the president not introducing essentially third world risk into the united states isn't that what you think about when you think about investing in emerging markets?
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we had an interesting conversation about risk in emerging markets erdogan may go in and fire his central banker or otherwise tell him what to do with risk that's third world risk being introduced into the united states that's not benign. >> i don't know that it has that if you have open warfare, i can't imagine that with his two nominees now for the fed, that he hasn't had the -- >> prospective nominees. >> right, right. he hasn't had the -- very open conversation with them about what he's feeling and if they're willing to go along with it, which they are, they've gotten sign on. so, to me, you could potentially see open warfare in the fed rather than how we've seen most of the stuff behind the scenes occur and that's destabilizing, whether he fires powell or not, powell to me is like the nuclear option so in terms of the market maybe the market's benign to it, maybe they don't care, right, it's just a bunch of mindless etfs going up and down, but i think that's destabilizing for confidence in the economy, in the fed, in the monetary system,
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and yes, that's the risk >> should the fed cut rates right now by a quarter point >> cut them to zero. >> the market is telling you that you should cut it by half a rate >> so does the market off base >> no, but look, there's -- there's a case to be made that when you look at inflation, per se, it's not rising, it's still on the tame side many actually of our clients that we talk to -- >> dubravko, let me interrupt you one more time. i'm sorry, scott i apologize. play your scenario through the fed cuts by half a point because it ought to. in the wake of these comments by the president. what is the thinking on the street about the reason why the fed moved? >> and the political -- the political aspect of this, where you talked about 2020 being the election, fed cuts rates, they're in the back pocket of the president, this becomes a wall street versus main street question going into 2020 and i think that this is -- creates even more uncertainty, even more issues in congress, even more
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ineffectiveness in washington if that were to happen. >> if we play that out, though, however, it's not a near term risk it's a longer term risk. it's a risk if we're in another emergency financial crisis about the action of the fed, and it's a risk long-term to the fed's inflation fighting credibility >> dubravko, last point. >> just say, yes, it creates uncertainty, creates uncertainty in d.c., i fully agree but as far as the stock market is concerned, three months out, six months out, 12 months out, it's a positive i'm sorry. that's at least my feeling >> i agree >> and yet with all that we're 50 points away from a new high on a s&p dubravko lekos, jpmorgan joining us by the way, a former fed insider is going to weigh in on this big debate on monday when we're joined by 12:00 p.m. eastern time right here on "the halftime report." cannot wait because he's outspoken, he doesn't pull his punches. we'll hear from mr. fisher coming up on monday. here's what else is coming up on "the halftime report." >> announcer: next up, the big call on intel, the stock's up
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17% in 2019. we'll debate the stock and the rest of the chip makers. also ahead, holding "the halftime report" invest committee's feet to the fire see where their picks hit and missed in q1 and what they're doing with them now. we're talking about two on the move, exxonmobil and clorox. before the break, what happens to the nasdaq 100 after a 15% or more gain in 3 months, which has happened 8 times since 2010. 88% of the time, it trades negative by an average of 1.89% for more, go to cnbc.com/kensho. "the halftime report" with scott wapner and the traders is back wapner and the traders is back in two minutes exactly. sounds like a case of analysis paralysis. is there a cure? td ameritrade's trade desk. they can help gut check your strategies and answer all your toughest questio
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it's a now there's one store that connects your life like never before store. the xfinity store is here. and it's simple, easy, awesome. welcome back i want to talk about two bullish calls today on some food stocks, restaurant brands initiated outperform the rating there at bernstein and tells the advisory raises its target on mcdonald's to $210. that's an 11% upside the restaurant brand's target was $77. i turn to our informal, yet unofficial, sort of official correspondent. >> yeah. >> what's the trade here, mr. shake shack? >> the start of mcdonald's is absolutely incredible. chart. you literally broke out of what could have been a triple top, you retested on low volume and then you rocketed right back off that former resistance level which i think will now act as support so if you want to be long this name, understanding
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that it's already had a nice run, this is as clear as a bell. $188 is your stop. take a couple of points in risk. there's no reason why if this chart holds up you couldn't see the stock at $225. paying a good yield, doing almost everything right, very few people can point to any f z flaws in execution and they're getting the tech side right. everyone claims they are but mcdonald's is crushing it on the tech side. the one macro-comment. >> burger king, tim horton's, the stock's been ripping >> they had a great quarter. >> one of then that have outperformed and sort of helped him recover as well. this stock hits a new 52 week high today >> i think the broader point is that these are businesses that have been forced to raise wages for employees and forced to spend a ton of money in r&d and the marketing spend isn't changing so they're doing all this and the reason why that's
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happening and the street is applauding it is because they've been able to raise prices. mcdonald's is not a 99 cent affair but people like what they're getting and that's what you're seeing on this chart. >> by the way, starbucks, all time high today back to the ipo from '92 that was just a touch over $75 what do you like in this space >> look, i think the space goes to -- i actually like domino's because of their technology. t it's not a cheap stock >> also killing it >> but technology, if you're a restaurant company, in addition to the franchise that you have there, whether you're mexican or whether you're, you know, like, chipotle or whether you're hamburgers like mcdonald's, you need the technology. because the you take a look at what's growing there, it's the ability to call in an order, it's loyalist programs that really are driving these companies now. >> it's one of the few -- >> you got to pay attention to that >> it's one of the few that hasn't run away from the pack, right? had that pullback and it's still
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$50 or so away from a high is that the way to go? >> if you feel -- from an execution standpoint, i think that, you know, those are two separate stories mcdonald's is obviously been executing, they're already immersed in technology, they made a couple of very timely acquisitions in that way i think there's more of an opportunity for a catalyst for restaurant brands particularly as it relates to the tim horton brand. however, i think if you think about this from a more macro perspective, you know, this is not a poor entry point to get into fast food because if we do see economic softness, these stocks do tend to perform a little bit better as people trade down from that fast casual, so you know, i think from a execution standpoint we see positives, a catalyst standpoint, and then timing-wise, it's not the worst time to enter into the space >> these stocks trade momentum of the earnings rather than the valuation. chipotle's not trading on valuation. that's for sure. mcdonald's isn't trading on valuation. >> one thing that's really making me angry about the
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technology is the inconsistency and i just will point this out really quickly when you do the starbucks app and you put in your order and it loekts the nearest store, you walk in, you never have to speak to a human being, it's sitting on the counter waiting for you, your name is on a sticker. it is like -- it's literally magic. you cut an entire line, no matter what time of day. when you do that with chick-fil-a, you have to check into a kiosk even though you ordered on your app and put in a code and then they first start cooking the sandwich so it's like, what did i need the app for? >> are you speaking from experience >> i just want everyone to get on the same technology standard. i don't have time for that what am i using the app for if they're not going to turn the grill on before i walk in the place. >> he's got to get to the next place. >> everyone should do it the way starbucks is doing it and on the delivery side, i don't want uber eats, i don't want some rando. if you're not doing the delivery yourself the last mile, hold off until you're ready to do that. i think there's a lot of inconsistencies. domino's really gets it right.
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you can track the driver on the app, literally i can watch this guy stop at a stop sign or roll through it and i will adjust my tip based on that but a lot of them are really just, like, they say they're doing tech, they're not really doing tech. >> never seen you get so worked up about this. >> i'm glad to hear he tips. >> look at him >> somebody's got to say these things >> right somebody's got to salespeoppeake truth. intel, those shares have rallied nearly 18% this year the broader semiconductor space is now within 3% of an all time high that space has been ripping after late almost 6% of the week and that's the best week since january so wells fargo, though, now they step on the sidelines on intel, they go to market perform, and it's an interesting time to make a call like this and to have the broader discussion these stocks have just ripped. so it's our call of the day. >> well, intel, look, i mean, i just remember when the ceo, when he was supposed to be the ceo, when he was in the hunt, the market didn't like that. then all of a sudden you name ceo, take away the certainty and
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the stock starts trading higher. they bring in a new cf to so if you want to be in this space, why not be where there's juice, where it's easy to turn it around intel's got some legacy issues still. so, i don't mind the call. >> so, we own the stock. i think that given the run that it's had, i can see being sort of neutral on it here. i think that there's better opportunities. i think the amd competition is real over the next year or so. however, at any point over the last 15 years you could say that at any given time between these two companies so i think there's a trade here between intel and amd. we like broadcom better. that's our view. >> that stock hit its own new high this week >> that's a monster, that thing. >> you've owned that for a while. >> we actually bought that probably about a month ago or so so we've been pretty happy with the holding so far >> checking out today, just a few bucks shy. headlines with sue herera. >> hi, scott hello, everyone. here's what's happening at this
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hour president trump talking to reporters at the white house before heading to california for a border security rally. he was asked whether he viewed joe biden as a presidential threat >> no, i don't see joe biden as a threat, no i don't see him as a threat. i think he's only a threat to himself. i just don't see him as a threat he's been there a long time. his record's not good. he'd have to run on the obama failed record. >> and speaking of obama, the former president arriving in berlin for private talks with german leader angela merkel. she stood outside the chancellory on a red carpet to welcome him. the two reportedly will discuss the strained transatlantic relationship and hedge fund billionaire ray dalio and his wife barbara donating $100 million to support public education in some of connecticut's most disadvantaged communities. the governor's office says it is believed to be the largest donation to benefit the state in its history. you're up to date.
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that's the news update >> sue, thank you very much for that coming up, options traders betting against a big industrial stock. that's right, against the stock that's had a 35% rally this year pete joins us with the big reveal of the name and unusual activity s&p right now is plus 8. we'll give you a check of the sectors, energy, healthcare, sctiararleading the way. "the halftime report" is back "the halftime report" is back right after this plants capture co2. what if other kinds of plants captured it too? if these industrial plants had technology that captured carbon like trees we could help lower emissions. carbon capture is important technology - and experts agree. that's why we're working on ways to improve it.
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so plants... can be a little more... like plants. ♪
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welcome back ge has seen a sizable rebound to start the year however, options traders now betting on more downside pete najarian joins us from minneapolis with some unusual activity i know one option trader who's been betting on more downside, that's the one i'm looking at in the camera you mean there's others? >> yeah, there's somebody else out there, scott, as a matter of fact, because these guys are buying the first week in may, they're buying 50,000 of the 9.5 puts right now in ge now we had seen all that put activity for months and months and months we hadn't seen it in a while now and now we're seeing it once again so somebody's expecting the stock to pull back in the next couple weeks because first week of may is when those
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expire, big trade, fairly inexpensive but the risk-reward, i like it. i bought along with these guys so i'll be in here for a couple weeks. the xop. it's the s&p 500 oil and gas index. this has been on a nice move, a steady move to the upside. they were buying the last week in april calls, going for the 32.5 calls, and they were buying those pretty aggressively as well today, scott, bought about 7,700 of those and not more than 30 minutes later they bought 10,000 of the may 34 calls as well so expecting to see something happening in positive way in oil and gas i know we've talked about the price of oil and where it is and how it's been moving to the upside i have a lot of exposure in this particular sector. i own these calls as well so i like what's happening right now in xop i think it's ready to break out. >> hang on one second. hang on. hang on. >> yeah, yeah. >> hold up >> yeah, yeah. >> chill out come back to you in a second you get all revved up, you're like a lawn mower.
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>> that's right. >> all right so hold on one second all right? i want to talk to you about general electric what was the date on ge, the puts >> the first week in may so they're may 3rd expiring puts >> i'm saying, the earnings from what i see are scheduled around the 19th of april. so -- >> right >> that's not a big surprise, right? i mean, somebody's betting that the earnings are a disappointment again >> right >> and that the stock starts another drip >> yep and the commentary might not be all that positive as much as a lot has been built into what everybody read last time, so maybe there is a pullback this time that actually does push this below 9.5 stocks trading right at 10, scott, so it's just on either side of 10, so the possibility it's not that far away from a move that could actually put these puts into favor and actually start to explode to the upside >> okay. now, please, proceed >> okay. so, this is the most interesting of the three for me. jd, now, the reason it is, this
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is now hit 17 times this year, 2019, with bullish activity and if you look at that chart, you can tell for the most part they've been right on every single one of these buys well, they're buying the last week in april calls this time as well in jd, so the aggressive buying that we've seen time and time again, i continue to own, i continue to sell, i continue to roll up every time i see another roll-up to the upside, i want to ride along with them so, we're seeing some pretty aggressive buying in there as well, scott. 4,000 of these aprils, they're the 31.5 call so they're just out of the money of the where these are trading right now. these could explode to the upside with a move we've seen a lot going on at china, ashr i brought up several times, lot of activity there as well you see what's going on with baba and some of the rest of these so it looks like jd, i think, has more upside to come >> good stuff. pete, good weekend we'll see you next week. pete najarian. up next, the halftime quarterly report, josh and weiss, some of their q1 trades
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that worked, some that didn't. that worked, some that didn't. that's straight ahead. but to us, it's the pace of tomorrow. with ingenuity, technologies, and markets expertise we create the possible. and when you do that, you don't chase the pace of tomorrow. you set it. nasdaq. rewrite tomorrow. ...or trips to mars. $4.95. delivery drones or the latest phones. $4.95. no matter what you trade, at fidelity it's just $4.95 per online u.s. equity trade.
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♪ welcome back to the hoft report second quarter under way we take a look at some of the traders' most memorable calls from q1 in the quarterly report. weiss and josh are up now. >> agree realty. i recently bought the stock. it's a read. but unlike other reads, their business is composed of companies that are essential the yield is very good stocks been a meteor >> it's very rare to look across the market and find a name like this that's in the right space at the right time, very unique and i think over five years it could double and i really want to stick this one out for the long-term. >> all right let's do the good first. weiss, agree realty, up 13% since. what do you do now you agree or disagree with agree? >> i agree you continue to hold look, the family's never sold a share that ceo joey agree, who, full disclosure, he's a friend, they're in triple net leases and they're companies like panera,
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since he took over from being in the circuit cities to being in the walgreens, the cvs, where you don't have the risk of them going out of business. so over time, stock continued to move higher, it did get a bump from the ten year being down but rag rates are going to fluctuate not the highest yeeding read out there. it's a nice yield. >> you agree with agree on agree. >> totally agree >> dude's name's agree all right. store capital. another re >> i'm up like 45% in this name. let me tell you. it's in a great sector so it gets that benefit but honestly i've spoken with the chairman, i've spoken with the ceo, the more i read about what this company's doing. >> is the chairman's name store? >> no. but the chairman's the guy that invented the triple net lease so at the end of the day these are people that are providing capital to small business owners that own their own real estate
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and shouldn't. they need to unlock that value and reinvest in their business these are the people that come along and they do it but they do it on the basis of getting store level economics from these small businesses so they know what the good bets are and what aren't and at the the rate that they a compounding earnings and at the rate they're raising their distribution just an incredible story and this is one of those stocks where i have a standing order to buy more any time the price dips under 30, because of the overall marbli market >> of course, not all the picks have gone the trader's way some names they've said to stay away from have actually moved higher >> this stock has been an absolute dog.vicious selloffs. >> to me it's still a slow-growing company and still not cheap. i think things are overvalued and not even a safe stock at this valuation >> all right, josh exxon up 7% since february
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now what >> i don't know. i don't know i'm not bearish on it, i just don't want to be in it i'll show you stocks that are up 30% since february you don't have to be in everything >> oil related call. >> it's integrated, not a bet on higher oil and not incredibly hedged what this is is a devdened story and tends to fluctua chefluctuad down and this is one of them you made a lot more money in names like store from february to now you can't kiss all the girls, as warren buffett said. yo yo >> you're done clorox up 7% are you done >> he's never done >> are you done with clorox? >> i'm never done, as you say. i still feel the same way. i believe the stock is overvalued for the low growth that it has, but it's in a
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segment of the market where it's defensive and it's underperformed the s&p i tell you, i'm up 6% now. i'll take it every day now coming up, a viewer question coming in on merck you have time to tweet us and kelly evans has a look at what is coming up on "the exchange. >> hi, scott more on today's jobs report and also ahead what president trump is not doing that could lead to another housing crisis what a stroller recall that never happened is saying about consumer protection and amazon is taking a bite out of google and spotify getting leap frogged by apple and beyonce is getting in business with adidas. we'll see you then "halftime report" is back after "halftime report" is back after this dear tech... let's talk. we have a pretty good relationship. you've done a lot of good for the world.
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but i feel like you have the potential to do so much more. are you working for all of us, or just a few of us? ai that fights bias? ai that helps us see the bias in ourselves? we need tech that helps people understand each other. that understands my business. ♪ ♪ dear tech... dear tech... dear tech... dear tech... let's champion data rights as human rights. let's use blockchain to help reduce poverty. let's develop new solutions with the help of quantum technology. let's show girls that stem isn't just a boy's club. let's make a difference in people's lives. let's do it all. together. let's expect more from technology. let's put smart to work. ♪ ♪
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cbnc launched a financial education initiative called invest in you, ready, set, grow. part with acorns the saving and investing app. josh brown helped create a beginner series as part of financial literacy month with the first installment out today. discussing the difference between the stock market and the economy. >> yeah. >> not exactly the same thing all the time you shouldn't pay attention to one and how you think about the other, right >> i think you should pay attention to all of it and practice this idea that you can keep two simultaneous thoughts in your head at once
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sometimes those saimultaneous thoughts, hey, the economy is not great, but the stock market could still go up or vice versa. the economy is phenomenal but i shouldn't be invested in the market because that is not always the best time to do so. i think for younger investors not getting this education in school, this is a good place to start and we'll do more of these videos and i hope everyone goes on cnbc.com and looks for my picture and watches it >> understanding the economy is a helpful exercise, but placing market bets is a carnival game on the midway. josh, thank you. you can watch the full video go to cnbc.com/investinyou all right, 30 seconds left on this friday final trades shannon, you're up first >> valero energy, we like this here >> liz, nice to see you, again
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what do you have for us. >> sector industrial group similar. oil and gas. we're seeing a lot of profit potential going forward. >> zogenix got beaten down early in the week. >> good weekend, everybody you, as well thanks for watching. "the exchange" with kelly starts now. thank you, scott hi, everybody. here is what is ahead. stronger jobs growth this morning, but weaker wage numbers. and the president hammering the fed to cut rates, again. we'll look at whether the ten-year yield is going back below 2.5% self-inflicted wounds. the president is not changing the housing market enough and that fannie and freddie still need to go how likely that outcome is plus, a big milestone in music terms for apple. is this a sign the services push is working if so,he

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