tv Fast Money CNBC April 26, 2019 5:00pm-5:31pm EDT
be able to stay in the zone. markets that don't pull back and keep marching higher, even though they say the tank is empty you have to give it the benefit of the doubt. >> nobody expected that. we'll see if the momentum -- >> front loaded and get the jobs number next week. >> great stuff that does it for "closing bell." fast money begins right now. >> "fast money" starts right now live from the nasdaq marketsite overlooking new york city's times square i'm melissa lee. today's lineup is dan nathan, jeff mills of pnc, karen finerman and guy adami energy burning out and the worst performing sector as oil gets slammed after president trump says he is pressuring opec we have the details. plus check out shares of tesla the stock getting crushed hitting a fresh 52-week low and its lowest in two years now well below it's support how low can it go? the traders will weigh in. first, china, the shanghai composite having the worst week of the year after what has been an epic rebound for chinese stocks this after the government said it would pare back stimulus
for the economy. at the same time companies here in the u.s. like 3m and intel have been pointing to a renewed slowdown in china impacting their earnings so is this china's warning to the world and with u.s. stocks at all-time highs can the rally continue if china pumps the brakes guy? >> i've been looking for a reason for our markets to go low. you go back to sort of last summer when the chinese markets started to go down in earnest. we probably lagged them by, i don't know, two and a half, three months if this is the beginning of something maybe we're looking at a sell-off in late may, early june the market is down 5% after 35% and i don't want to make a big deal out of it i happen to think the chinese will continue to throw as much money at their markets as they need with that said, the commentary from intel and 3m. i know the s&p and everything looks great and beneath the surface, there are clearly some problems >> which is nuts for starbucks
for every one negative data point, and apple dropped the hammer on chinese demand as it relates to their products and i think that got things going. that worked into the bottom. that's yet shanghai composite sold off and they would pull back think about what they did. they had to do that just like global central banks, they had to pivot over the last few months to orchestrate this sort of rally and risk assets and i'll just make one point you have the dollar index, the dixie at 98 and a 52-week high and the ten-year treasury yield below 2.5% and those two things don't speak to some level of confidence as far as global growth and the imf have cut global growth expectations to below 3% so if china's 6.4% in 2019 growth will be less and it will be a problem for the global economy and a problem for risk
assets and you think about the dollar that the chinese currency is the largest component of the trade-weighted dollar. if china does pull back stimulus a bit and if growth is okay and they pull back stimulus that probably supports the chinese currenty which probably on balance weakens the dollar and that's probably good for multinational earnings as long as the story isn't falling apart and i don't think it is at this point. >> karen, are you worried at all? >> 5% and to your point it's off a gigantic move and i think if you step back a little bit and when was the last time they were there? i don't know that you can really -- i mean, to me, the more important data of the day is our gdp number which everyone thought there were so many reasons when the quarter could be bad whether the terrible, government slowdown and still to have this number, that's pretty amazing. so i don't want to talk about a global slowdown, and we're big enough to sort of help others out. >> here's a question >> i like when you ask a
question on "fast money. china's government unloads stimulus into the economy to help it as well as the markets and the marks go up and they say you know what? it's working it's working out so well, we'll take our foot off the pedal. could we have parallels in the united states when it comes to the fed and staying on the sideline to the point where the markets -- >> i have a strong opinion they are gone. >> it is not, when you look at what they said, they used to y data dependent they're not saying data dependent anymore. even if data doesn't go the right way and even if data is hot, we're not going to do anything we're going to go past this 2% we're going to take -- we had symmetrical below two and we'll allow it to go above 2 and you'll see the inflation numbers are actually down even with this gdp up the fed is gone. >> it's interesting. there is inflation and this asset inflation, ridiculous
asset inflation and there's clearly energy and health care inflation and so there's inflation in all of the wrong places, but karen's right. in terms of the fed and i'm going to offend a lot of people here and they are data dependent. they're dependent on the nasdaq going higher and the dow jones industrial average going higher. that's their data and if you don't think it's true just go back and look at what happened in october into december they turned on a dime because our market sold off so by that definition they'll never move and for larry kudlow who i'd like as a friend and respect as an exist and after 3.2 gdp print however we got there that there's still room for a rate cut that's absolute madness. >> it might be generous there. i think maybe you want to call him a strategist or something like that. a political strategist let's be frank we were talking about inflation. what did they just do? they said they'll use a portion of their profits, okay so their eps will be less, right? and the stock market has been bid up because interest rates are so low and what happened
they are going to get you their goods faster that is a disinflationary thing and did you see target down 5% today? walmart down 2% today and those have been massive disinflationa disinflationary forces and they can whine about what needs to be done and it's never happening again. he's a phony economist in my opinion, and we shouldn't be listening to that. >> does that say that he's right and we should cut rates? >> unless we are going to be locked in this world karen, think about this. in 2008 fed funds was 5.5% and in 2000 it was at 6.5% and we just topped out at 2.5% and these guys want to go lower and look at how much sovereign debt is all over the globe and they're talking about a whole new economic regime that the world has never seen and this economist is going to be at the forefront of this speaking against everything he's talked about for the last 25 years. >> and to bring this back to
what the fed might do, i hate to say it, but the gdp report is goldilocks and it was good enough to keep the recession fears at bay, but you end up at a point where 165 basis points of the gdp report was trade related and it was inventory build so the fed during the next meeting they can point to stable growth and it will be dovish enough and that's likely what they'll do >> the inventory build is absolutely and it's fine if it's demand on the back end and if we're pulling this forward and the demand is here and we're hearing to dan's point >> we saw the first half -- >> that could be problematic it could be very problematic and right now everyone seems extraordinarily happy. >> so given all this, where should we invest at this point wo we're almost half way. >> i don't want to be blindly bullish because the biggest drawdown we've seen this year has been a little over 2% and you go back over the last 40
years and there have been two years that have been drawn down 5% so we should mentally prepare ourselves for higher volatility and we have to i still like the breadth of the market and it's not just fang leading this market higher and you have 45% of stocks in the s&p 500 above 20% right now. to me, that feels pretty good. >> i have a news alert out of d.c. president trump wrapping up his meeting with the japanese prime minister shinzo abe. kayla tausche is there >> the japanese prime minister arrived half an hour ago and the two are currently meeting and headlines from president trump are crossing at this moment. on domestic issues the president said the gdp number out this morning was a surprise, albeit a pleasant one and he declined to comment over whether his former white house counsel don mcgahn perjured himself in terms of what he told the special counsel on the russia investigation and president trump's actions there. on international issues, part of today's meeting is to talk about trade issues prime minister abe wants to take
off the table any idea that tariffs on japanese cars could be put into effect and he really wants to ask president trump to eliminate the steel and aluminum tariffs as well and prime minister abe saying that tariffs will be part of discussions. president trump saying they will discuss trade. they will hope to make some progress on trade and potentially discuss a timetable for a bilateral trade deal the two sides have been discussing that for several years at this point and progress has been slow. we'll see if anything comes out of this meeting and they'll be discussing north korea, russia and china which the official tells us are common challenges for these two allies and we'll bring you more headlines as we get them as they relate to market-moving issues as they relate to tariffs. >> kayla tausche, just to recap all of this. we have a pending trade deal not yet reached with japan we have the new nafta which is up in the air and we have not a
trade deal with china. what does this uncertainy and where does that leave the markets? >> i don't think we were any different from 24 hours ago or six months ago closer to japan. to me, that's the elephant we're no closer now than we were six months ago we can jawbone this thing, again, if you're the chinese why are you making a deal? string us along. that's what i would do if i were then there's no reason. there's an election coming up, you know when? november '20 you know why because you've asked me two times. i would continue to do when they're doing and they're down 5% over the last week, week and a half and the markets are fine and they're throwing money at it and string the u.s. along and they'll be fine. >> i had the pleasure to sit at the halftime desk, and maybe this uncertainty about trade is actually better for the markets and actually having the center of a bad deal.
>> maybe, i don't know let me tell you what corporate officers are deploying capital and they just got this great tax cut a year and a half ago or whatever and they like visibility and they like to forecast how they'll manage their businesses and what 2018 showed us at least in the financial markets is that it did not translate, right as far as companies were concerned because they were unable to give clear visibility as it relates to guidance and we saw that this week and we had a dint tenor as far as earnings season week over week and from very cyclical companies like intel and 3m >> and it was a dramatic slowdown in china. >> i think it could be a good thing for the market and you have all of these things going on at the margin and china trade resolves in a way that isn't too bad for the marketplace, but at the end of the day i think that ends up being okay for the market. >> still ahead, it is a huge week for earnings ahead with apple set to report on tuesday
plus tesla tanks the stock is down 30% this year and the traders say it's trading at a very critical level we'll explain. >> we are in tesim square. much more "fast money" right after this they don't give two and a half stars to just anybody. here you go. what's this? it's your piano. hold this for a sec. we don't have a piano. no.. but the neighbors do. just ok is not ok. especially when it comes to your network. at&t is america's best wireless network according to america's biggest test. now with 5g evolution. the first step to 5g. more for your thing. that's our thing.
welcome back to "fast money. tesla tanking 5% as the electric vehiclemaker deals with the fallout and ongoing battle with the sec. it hit its lowest level since 2017 now breaking through the key support range that's been in the last two years and on the flipside, ford is surging after its earnings having its best day in a decade and the automaker surpassing tesla's market cap for the first time in nearly awe year you've been doing a deep dive into this. >> this thing is interesting to me and we have a chart that's showing tesla bonds and the one that trades most liquidly against the stock for the year the thing that's interesting, the yellow line which is flat is the bond moving up and down, up and down and theth line is the equity and what that's showing us is last -- many times the stock has been right where the bonds are, but now the stock's broken way through the bonds why aren't the bonds down? the reason the bonds are down
because bondholders who i believe are much smarter than the equity holders believe that some sort of equity raise would be the best thing for them and that would secure technically, but that would put a floor under the bonds which would be good for them so they always know first, they're telling you a big raise is coming. i don't know if that's good or bad for the equity, honestly >> that is the question. >> and what is the right amount of money it's a $4 billion market cap and it shouldn't be that hard to rauz a few billion do people throw in the towel or do they have plenty of room to let the business run in the past it's not been a challenge for the stock or not for the long term. >> and five or six different forms over the last two and a half years i would say each time it's proven to be an opportunity because elon muvensk buys it ani think it's different this time for a lot of different reasons and not least of which the stock is to levels we not have seen in quite some time. a couple of points and greatjo
from chris verron and what did he say quintuple bottoms and someone put a big quint, and the captain in the movie jaws and tif and tim seymour has been on this thing and 175 is now critical support. if you're looking for a level, that's it. >> i suspect what's changed now is the story is pretty muddled all of those times in the leadup to the model 3 release, that was the thing and that was the great white that they were going after. >> oh! >> right now it's out and sort of underperforming and the financials are kind of strained and i think if they do a capital raise it has to some with some strategic announcement and a package where they basically clear the decks for the next two yearses so they can go and execute. >> what are the things that they did that 15, 16, 17 and 19 now
and other competitors have had five years to get closer to building a real competitor at tesla's product. would you be more inclined to say long or short? >> the outcome seems too binary. as an investment and the long-term investment it will either go really well or really poorly and i feel like from a risk reward perspective that's not something we're very interested in. the stock is down 30%. the downside isn't as much and they burn cash and it's not showing up in profit growth and people start to tire and they're not willing to fund them at cheap levels and you have big competition and so on and so forth. for us as an investment. >> we've learned that the sec and elon musk tesla have reached an agreement over twitter. originally they'd asked an extension for april 30th and we don't have the details yet, but
apparently they have reached an agreement so that should theoretically be behind musk and that's one thing cleared out here >> do you remember when they settled some suit and something that they paid a $20 million fine and the investors didn't care and the stock was much higher and the price to action this week is how orderly the sell-off has been in earnings and it hasn't seen an uptick, but it hasn't been panicky it just drifted into the close and they're down 5% today and it felt near capitulation, but i think it will take some sort of announcement much bigger than this to get the stock going back in the right direction >> this still has to be approved by the judge, but they have reached an agreement at this point, but back to the question. >> i like the question 100% >> this is what you will say to me, if you flew in from mars today. >> i wasn't going say that, but keep going. >> i wasn't. >> how would you trade the stock? >> no, i wasn't going to say that, given the support levels
it reached -- >> he came from mars >> this is how i would trade it and this will be counterintuitive to folks out there that i would put my trading cap on, you buy it on the close above 250 and 255 and look for 175 and that's how you trade it based on 175. >> underscoring the levels here. >> mars. >> for more on tesla and how much it could really be worth head over to trading nation.cnbc.com. i'm melissa lee, you're watching cnbc, first in trading worldwide. >> how do we know it will end differently than it did before. >> well, we don't know how the movie ends and the traders will tell you what the blockbuster means for disney shareholders. >> we actually thought you were like a yseti or something >> not that, and the cooler
stock is sgiurng and we'll explain. there's much more "fast money" right after this i'm working to keep the fire going for another 150 years. ♪ for beauty that begins with nature. ♪ to make connections of a different kind. at adp we're designing a better way to work, so you can achieve what you're working for.
welcome back to "fast money," disney's hotly anticipated avengers endgame movie is breaking records around the globe. julia boorstin is in los angeles with the details julia? >> melissa, that's right record breaking numbers from territories all around the world put avengers endgame on track for an unprecedented $1 billion worldwide box office opening weekend, that would dwarf the current record which was set by avengers infinity war with $40 million at the worldwide box office it is tracking toward $140 million domestically saying that it is on track to gross about 300 million over the weekend the film has already grossed over $150 million in china.
>> avengers benefitting from rotten tomatoes and also positive word of mouth com scores north america audience survey found 80% of moviegoers would recommend the film to their friends and 30% said they'd see the film again in theaters. endgame is expected to turn around the domestic box office which is down 16% so far this year and a further boost theater stocks which you see now are up pretty significantly year to date disney is expected to dominate the box office this summer cowan saying disney has a murderer's row of films coming out including lion king, aladdin and toy story. disney is releasing almost half of all of the movies coming out this summer with a budget of $100 million or more a massive hit would not only be a win for disney's studio which spent $400 million to produce this film, but could also benefit disney plus, and the
disney service launching in november because marvel and all of the characters in avengers endgame will be featured heavily on that service. guys, back to you. >> disney shares soaring to an all-time high just this month as it unveiled details and the halo effect from all of this positive, the reviews et cetera, around avengers would be very different. >> it is not just about the studios and for five yearsthe stock has been trading between 190 and 120 waiting for this strategy to emerge and since the disney plus announcement the stock is up 20% in a straight line and the company will report earnings on may may eighth, and they'll incur a lot of losses to do this. i think it's all great and you'll buy this on pullbacks. >> buy the rumor and sell the news and the most obvious example of that is the big movie release that's about to in out you look, the stock's gained $16 billion of market cap in the
last five days, maybe? six days to me this is another classic buy the movie, sell the news. >> 22 times, that's a staggering multiple on disney's history and based on its peers maybe they deserve it and to dan and karen's point i think you have to be careful going into earnings and there's absolutely nothing wrong with taking money off the table in disney here >> all right it is time for the final trade let's go around the horn >> apple will report tuesday after the close, but i wouldn't chase it here. >> jeff mills of pnc >> this is less about what to own and how to own it. look at ijr for your small cap exposure versus iwm. its exposure to the s&p 600 and not the russell 2000 and it's likely to do much better in a down market. >> thank you for joining us, jeff, by the way karen? >> yes amazon prime is going one-day
shipping and we don't know when that is and we do not know how much it will cost amazon to do that i think target is overdone i like it here and they're doing the right thing. >> guy >> see maria hall yesterday? >> yes the professional poker player? >> who did she give a shout out to >> she watches the power pitch and she said i did a nice job. unh into next week, peeps. >> that does it for us on fast, see you at monday at 5:00, don't move "options action" starts right after this
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hey there, we're back. did you miss us? we missed you. the guys are getting ready for the big she. while they're doing that here's what's comin ♪ ♪ ♪ it's the final countdown >> the countdown is on to apple earnings and with the stock still down more than 10% off its highs, dan nathan has a way for you to play it into the results. plus -- soup and cereal stocks are on fire, but has the group gotten too hot >> i don't know. >> i don't know. >> i don't know. >> well, we do and the chart master is going to break it all down for you, and