Skip to main content

tv   Fast Money  CNBC  July 11, 2019 5:00pm-6:01pm EDT

5:00 pm
look, at 242 seven weeks ago, went to 195. we only got less than half of th that it could run a little bit. >> it was a lousy option today. >> banks did well off that turf we saw today industrials were the best performing sector. record closes with the s&p and dow. >> it will be the most important thing to watch. >> we're out of time that does it for "closing bell." >> "fast money" begins right now. "fast money" starts right now. live from the nasdaq market site overlooking new york city times square i'm melissa lee we have guy adami, rana novini tonight on caps, stocks at record highs now is the time to put on your pull we'll explain why. earnings season about to kick into gear and three names we will be told to buy. we start off with the market at record highs, the dow cruising through 27,000 for the first time ever as wall street waits
5:01 pm
for the highly-anticipated rate cut. tech sold out. the nasdaq hitting a record high before reversing lower as big tech is under fire the white house is hosting a summit targeting social media giants can tech rally in the face of the major headwinds or is the group handcuffed so many options as to where to go guy, what do you say >> first of all, this is unbelievable actually -- >> no. >> it was years ago -- >> it is interesting that, you know, billy joel, great artist and you played potentially his worst song. >> i knew you would say that. >> thank you. >> up town girl. >> excellent point. >> terrible song. >> with that said, can you still buy tech here? i think there's still an inch you can buy. facebook, if that's technology, will rally in energy i think on microsoft, that's fine let's look at micron real quick because i think it is where the battle line is being drawn that stock was at $32 on june 25th when they reported
5:02 pm
earnings, and the stock has rallied probably 30% since then you sort of break down the earnings guess what earnings were okay, weren't great. 64% of revenue, was down 45% year over year, and nan, the other 31% or so, down 26% year over year. say to yourself this revenues are declining in names like that. is it being commoditized yes in a name like micron you have to take money off the table. >> in a big tech name, is growth in question with these stocks potentially under regulatory assault? >> listen, i think you want to look at maga, the microsoft, apple -- >> i'm sorry. >> i think it is the most important thing here, because obviously there's a reason why google is still 13% from its all-time highs while we know that microsoft makes new highs every day. we know amazon is within a percent and a half or two of
5:03 pm
their all-time highs so they're kind of different stories. i mean, listen, if you are talking about mag cap stock, guy thinks it is okay. a stock like this where there's so much positive sentiment into it as valuation is stretched rnls i don't think it is a name you want to be into. i think july as we get into earnings season and the fed thing, mel, you said it yourself, the much-anticipated fed rate cut, everything is anticipated at this point. i don't know how you buy anything on the news i don't know if it will be good enough to buy stock after the report in the next few weeks or you buy the market because we're going to get a rate cut. >> well, i know we're having a tech conversation, but we need to have it in the context of today's market which i think was about a yield's conversation more importantly where yields were going to seemingly zero,s the back up in yields and back up inflation, might put more pause to the tech trade than i think regulation otherwise i don't think anything is stopping tech if you look at qqqs which is
5:04 pm
what we're talking about, they've outperformed the s&p by 400 basis points since the low that started in june that's an environment where you have all about the fed, and i don't see what changes here. again, you are talking about reasonable valuations in facebook, google you can't say that in amazon i can say it certainly in apple. i think you have every reason why people would be running into big cap tech. >> when you take a look at valuations here and you are sort of thinking about the framework in which the value of these stocks, do you also put in a question about their future growth depending on what comes out legislatively or from other countries in terms of taxes on revenues and things like that? i mean those things are -- >> they're unanswerable. >> should there be a discount in the valuation? >> i would argue there is a discount to the valuation already in there when you talk about -- i agree with tim that google and facebook to me are not super expensive. microsoft, a great company, they've been killing it. that is actually getting to be a little bit more expensive. so when you ask the question, is it okay to buy here, if you go home long, it is the same as
5:05 pm
buying it here i am long on facebook, i am long on alphabet, i am long apple i think that today was, you know, started off as fed, but i think it is already priced in. i am long but afraid of this market i like we are getting back to fundamentals we are just starting earnings season we will have a lot of new information the next week or two or three i think that to me is what i'm going to -- what i really care about the most, and then second to that is the trade deal. >> i think when you look at these, i think facebook still is a buy because of the growth rate they've got right now. i think google has gotten punished too much. >> and that growth rate is not threatened by the looming regulatory things. >> i'm not concerned. >> handcuffs, for instance, for the ability to acquire another company potentially? too big already? >> i think if they were forced to split up, it would be an incredible deal for facebook when it was said and done because some of the parts would be huge i think. i think you have to look at some of the names microsoft to your point, karen,
5:06 pm
and i say it as a guy that's owned microsoft for five years, i am getting a little concerned. it is pushing towards 30 pe right now. when i look at that one, have i sold it? no to your point, i'm basically buying it today because i continue to own this stuff i do sell calls again and i have a call spread in there but today with a price target of 150 put out at initiation, i look at some of that and i'm like, wow, we are really getting in front of ourselves a little bit right now. but apple is very cheap, 12, 13 times. cisco is very cheap. some of the old tech stands out to me. you look at fintech, look at paypal, look at visa and mastercard, all part of the xlk as well. those are trading at 30-plus times earnings right now do they have enough growth really to support that it makes you wonder are we seeing certain areas where there's too much to the upside, too much excitement where they could pull back easily. >> i mention facebook is interesting to me because in early june the stock went down 10% in three days, i don't know if it was ten but it was reported they were going to look
5:07 pm
at them and possibly open up a case against them. what has it done since then? rallied 25%. if you think about that move in a little more than a month, you say to yourself, wait, think we are discounting what the unanswerable questions might be. i think it is important to remember that last year when they reported their q2 -- this is facebook -- and they guided down for the second half of the year, expectations for earnings growth at 20% in 2019 went to zero flat year over year. okay sales growth is still 24%, but who knows what the fines will be, how much they continue to have to spend here that is my only point. there's a lot of unanswerables when you have stocks rallying the way they have in a short period of time you don't want to be off side, especially in front of an earnings event like we're going to get wihen they report n july 21st. we don't know what the guidance will be. >> that's the point, which is why i think facebook can rally in earnings. this is a conversation we had for a while. i said it last night and for the last few weeks, i want to dislike facebook for a myriad of reasons, but if you look at what it did technically over the past
5:08 pm
couple of weeks, the subsequent rally leads me to believe, as much as i hate to say it, it probably pushes towards 218 which was the level we saw basically this time last year. we have a news alert out of washington, d.c. on the white house social media summit. ye l y lan mui has the details. >> reporter: the president said he plans to ask the major social media companies to come to the white house for a meeting sometime over the next month facebook, google and twitter did not get invites to the event held today and said president trump met with conservative critics who believe that they have been discriminated against on the major platforms trump said that if he invites the major companies, they will have to come now, we did reach out to facebook, google and twitter to see if we could get any more details on this. no word so far president trump saying now he want to invite them to the white house. back over to you. >> so finally they get to go to
5:09 pm
the white house after all, ylan. thank you, ylan mui in washington, d.c. is it a good thing they go to the white house or a bad thing they go to the white house karen, what do you say >> i think it is a badding this. i think it is a bad thing he wants them to be a punching back for fake news or they discriminate against conservative views i don't know it hasn't generally worked out well but the stocks seem to cross right before congressional hearings and that sort of thing. this is a little different markets at record highs and the fed hike coming down phil, welcome back good to have you sorry to have to squeeze you in over there. >> market is so exciting we need six of you guys here. >> kind of crowded don't fight the fed, isn't that what we've been doing strategically since the lows in december when we rallied 27% or so >> it is incredible to talk about this market here we are coming off the best first half in over 20 years, best june in half a century.
5:10 pm
you have the longest expansion now, so expansion between two recessions that we have seen since world war ii so you should have a fed tightening rates, right? no, the fed is easing rates here you know i know guy is a baseball fan, reggie jackson in 1977, that's who the fed is right now. the don't fight the fed playbook is have u.s. equity in the portfolio with a financial conditions argument, not because you believe earnings are lights out but financial conditions are so easy but make sure you get some carrier yield i feel like it is 2011 all over again, but this is the story don't fight the fed story. why is the fed easing? is the fed easing because inflation is slipping a little bit from the 2% down to about 1.6%, 1.5% they have to recalibrate one or two easings? if that's the case, we will be right on equity. if the fed has to go four or five times over the next year, look out below why is the fed easing i think is really important. >> does valuation not matter
5:11 pm
>> so if you are using valuation as a determinant, 16, 17 times is not extensive on a pe standpoint, forward pe standpoint on the s&p. i think trade is going to put some sort of a ceiling on whether investors why pace 18 or 19 times there is some sort of feeling on multiple expansion from valuation standpoint, which is where the high yield story comes in, and also a call on the s&p if you buy a call on the s&p at the money you get the upside protection and it is the hockey stick diagram, you win on the down side. >> you know, we look at where interest rates are to figure out what the bright pe multiple is. >> yes. >> if interest rates are zero, what is the right multiple for the market >> you are going through 20 on that, right. >> it is infinite. 420 on that. >> that's an important consideration. if interest rates are at zero that means you are in a bad scenario, right? you can't look at it that way. also, what is the fixed income
5:12 pm
market telling us at 2%, 195, whatever people are say ironing, are we going into recession? we are at 2% for a lot of reasons, most notably the fed's balance sheet is gigantic and there's no easing. >> i don't think the fed is going to cut four times and i don't think you're saying that but i don't know if the fed is going to cut two teams i think it is a market priced for at least that. what is your sense on that scenario >> so it is one meeting at a time we think they're going to go in july chances are they go 25 in july, and then it is a cost benefit analysis after that, right so if the cost of them using another bullet -- they have nine bullets. they raise rates nine times. if that cost of using another bullet is greater than the benefit of them being put in a better situation to reach their inflation mandate, they will go. we think it is one or two, tim, only because we have a 1.5%, 2% gdp growth rate on the economy and they're recalibrating rather than starting.
5:13 pm
>> that doesn't sound convincing to me to be long equities at this point we know 100% chance of a 25 base point rate cut in july the rest of it sounds sort of a little, you know, in the air, in t the ether. with where we have come in the market, what's the balance of the risk reward at this point? >> low in terms of expectations. equities can clear 4% earnings a quarter and put a 2% dividend yield on top of that, maybe a little multiple expansion getting you to 6% or 7% over the next year. it is a double digit return on equities here. on the down side financial conditions are so easy, over the last decade you have been proven if financial conditions are easy investors will climb the wall of worry. that's where we're coming at it is not gdp growth is going to be four and equities will take off. it is more of the fact the fed will keep financial conditions so easy consumers will love their mortgage rate and that will keep the economy growing a
5:14 pm
trentd, which causes a grinding higher in the equity make. >> phil camperrelli at the end of the desk. >> i am guilty of that almost on a nightly basis. sometimes it is that easy to fill out points. i'm not suggesting it is a dumb view, it is the right view with that said, the warning signs continue to be that russ else can't get out of its own way, the precious metals market continues to rally, 24% of sovereign bonds globally with negative yields. those are concerning things. obviously equities don't care. for next week and following weeks i think earnings are going to matter a great deal. >> the impact of the china trade war, and then this morning's -- >> yes, i will say this though in october of 2018 when the s&p 500 made a new high at 2945 or something like that, the upside down risk/reward was not favorable. it was the same case in april when we made a new high by a
5:15 pm
squeak, 2950 or something like that now we are at a new high, you could say the same thing phil made an important point you can buy a call at the money, the s&p y that tracks the s&p. you can buy it out, 299 call for 1.5% of the atf cost if you are thinking about that, you watch the show and watching, no way tim was on last friday, it is a compelling risk/reward, that you get a lot of earnings and the fed announcement. >> coming up, microsoft taking on slack with its own enterprise messaging service, is about to put the tech unicorn back in the stable plus, earning season around the corner with a big bank one top technician says there are three names you should buy ahead of the court live from times square in new york city, much more "fast money" right after this. ♪
5:16 pm
5:17 pm
america's top states for hey! i'm bill slowsky jr., i live on my own now! i've got xfinity, because i like to live life in the fast lane. unlike my parents. you rambling about xfinity again? you're so cute when you get excited... anyways... i've got their app right here, i can troubleshoot. i can schedule a time for them to call me back,
5:18 pm
it's great! you have our number programmed in? ya i don't even know your phone anymore... excuse me?! what? i don't know your phone number. aw well. he doesn't know our phone number! you have our fax number, obviously... today's xfinity service. simple. easy. awesome. i'll pass. welcome back to "fast money" microsoft revealing some new data today about its workplace messaging software teams and how it holds up to rivals like slack. let's get to josh lipton in san francisco with more on this. hey, josh. >> reporter: melissa, teams is microsoft's response to slack, and the company just released some big, new stats showing its traction, saying that the teams
5:19 pm
service now reaches more than 13 million daily active users, ahead of slack's last reported number, 10 million in the three months ended on january 31st microsoft providing this chart showing the growth microsoft, remember, includes teams in its office 365-bundle at no additional charge. as for slack, it made its debut on the new york stock exchange on june 20th, surging about 50% on its first day, but even before this news was down about 10% since then the company can't comment due to quiet period restrictions, but worth noting when it reported results back in june it had 645 paid customers with over $100,000 in annual recurring revenue, an 84% increase from a year earlier, and that large customers accounted for 43% of total revenue. it also stresses how engaged its users are. for example, it has noted in the past on a typical workday paid customers average more than 90 minutes using the product
5:20 pm
so bottom line is microsoft, a slack slayer d.a. davidson doesn't think so he says slack has strengths of its own, a strongly-liked product, unique features he says it is the tech industry's favorite tool and it is a neutral platform, designed to work well with any tool they still consider slack a possible takeover target if the ceo is willing to sell back to you. >> thank you, josh josh lipton in san francisco how deep is it >> i think it is deep among the community, but when you think of microsoft and the transition they had in the business to the cloud over the last five or six years, you say to yourself, they have thousands and thousands of customers there and they can up sell them to the new product with slack i think to josh's point or whoever the analyst he was quoting, if google didn't have the regulatory issue i think they would be buying slack and put butterfield ahead of
5:21 pm
their enterprise division and build out this stuff that's coming to a theater near you. i think when these guys have the government off their back a little bit. >> i think it is bad for slack and the reason i say that is they passed them in terms of the numbers, 13 million versus 10 million. that's part of the issue, but they have all of the money in the world to throw at it they can offer it as part of the rest of the package, and it kind of remind me of the days when zuckerberg was sitting there trying to buy snap, they didn't want to sell what did he do he got instagram and attacked and won the world. by the way, when is slack going to make money? if they don't make money, when is it going to happen? it is like uber, like how long into the future will they be burning while everybody is waiting for them to make money and be profitable. >> dan makes a good point in terms of what we talked about in first block of the show. are the giant tech companies handcuffed from doing
5:22 pm
acquisitions which would have been run of the mill acquisitions in another time, but now they can't do it they will be looked at as too big. >> in the case of microsoft, does it matter they turned their boat around for two-and-a-half, three years ago. >> alphabet? >> google is a different animal. they're paying for it in terms of the stock performance over the last six to nine months. getting back to microsoft, as pete said, they report in july they had an out perform, $150. that might be the case you are looking at it and you said it. valuation, you are getting close to 29 times next year's earnings you have, i don't know, 13% eps growth at what point is the stock expensive? i think it is getting there. >> one of the reasons i think microsoft has to blow slack out of the part, if you think about it a big part of their business is enterprised and there's a ton of competition there why not have this extra piece of that enterprise package that sets them apart? they don't need to buy them.
5:23 pm
>> for more on microsoft's plan to take on slack, go to cnbc.com you are watching "fast money". first here in business worldwide. here is what else is coming up >> i'm so excited. i'm so excited! i'm so -- scared >> yes, that's exactly how we feel with earning season just around the corner and one tough technician will tell you the three names he thinks are about to be big winners. >> in the beginning there was one. @jisann of montreal, quebec now @jisann of montreal, quebec, you are now one of 300,000 fast money twitter followers. thank you, fast money fans, of your support of america's market show and join us at cnbc "fast money" no, the account is not run by an intern ♪
5:24 pm
5:25 pm
at comcast, we didn't build the nation's largest gig-speed network just to make businesses run faster. we built it to help them go beyond. because beyond risk... welcome to the neighborhood, guys. there is reward. ♪ ♪ beyond work and life... who else could he be? there is the moment. beyond technology... there is human ingenuity. ♪ ♪ every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. take your business beyond.
5:26 pm
welcome back to "fast money" stocks hitting all-time highs as the market gears up for earnings big banks set to report next week along with united airline and jnj, chewy reporting first earnings ever. data from refinitive shows that revenues are expected to rice more than 3% will earnings confirm with the rally, and i think another important component is going into earnings season about 80% of s&p 500 companies have preannounced so we'll have lowered expectations going in. what do you think? >> well, to me the banks are a bellwether i want to see them not so much for how they -- no particular quarter for the banks is make or break it is they have good insight into what is happening in the economy. to me -- i know dan will take the other side -- i think the
5:27 pm
valuations are attractive here obviously rates are super low, although today they actually seemed to turn around. j.p. morgan, you know, we will see next week. we will get all three, j.p. morgan, bank of america and citi i think the risk/reward is pretty good. >> listen, they set up great eric is going to tell us how good they look carter was on goldman. what looks bad is carey. >> the worst chart ever. >> atrocious they're not confirming the positive price action. >> we are talking a little bit, maybe apples and oranges in that the kre is made up of other things. >> and the xlf top holding is buffet's berkshire so, you know, whatever okay >> pete, i heard you talking on the halftime report about banks and how they haven't really responded to -- >> right, disappointing would be the greatest words i can come up with in terms of the banks. >> exactly. >> i have owned a lot of different banks. right now only in two, bank of america and citi i bought citi the other day in front of earnings. i think the negative tone we
5:28 pm
seem to get for the banks has been so persistent it almost feels like a situation where we're in position that whatever they say will be better than whatever the terrible expectations are i think that's where we're sitting right now with something like citi. >> our next guest says you should buy three charts. ari will tell you what they are. >> hi, melissa here we are, the stock market off a new high we see the potential, the surprise to the upside i think the key point for us, the key bullish message is that the safety trade is stretched and showing signs of fatigue i think there's a potential to get the rotation into cyclical that could help propel the next leg of the advance let's start with the ten-year u.s. treasury yield to make the point. this move from 3% to 2% more recently, it was the very defensive, counter cyclical, high dividend-led rally by utilities and rates. now we are at a point with the ten-year right into 2% resistance -- support, marking
5:29 pm
it september 2017 low, and showing signs of turning higher. there was a nice reversal there. i think there's some additional upside there, to about 2.3%. that's where a prior breakdown level comes in at, where its moving average is, and i think that sets the stage for more cyclical areas of the market to start to perform better, like the banks. now, they are indeed a mixed group. i would be selective here. to dan's point, the regional banking etf kre, that's a function of small cap there. you have issues there capitalization wise. i want to play with quality, stick with quality, stick with j.p. morgan. here is why. here is what you have in the charts it reversed its down trend in april that, you know, it initially broke down last year, and the key level i'm watching is 119 now, we are still below there, but we see a little bit of a turn from the 200-day. it is above there. i think if banks work, you have a set up where j.p. morgan breaks higher, you get the break through 119, i see less down
5:30 pm
side risk here given it is a mixed group if it doesn't play out. this stock held up better on the down side. theme attically though i think you want to stick with high growth given the late cycle economic backdrop we are in. one name that stands out here as potential, you know, just starting to turn up again is square first for the chart, made it a high or low more recently, starting to turn up from there, and this turn more recently, that broke the down trend it had been in since peaking in 2018. now, this is part of a very broadly strong mobile payments industry, when you have visa, mastercard, paypal at a new high, i think investors will be looking for something that's less extended below its prior peak and you see a resumption of what is still a long-term uptrend in the share price of square one more stock for you, an energy stock now, truth be told we are bearish on the energy sector, but i think if you want to play it, you want to be in the leadership of this lagging sector
5:31 pm
mid streams is really where we are seeing relative strength within the energy group. one oke. one oklahoma here is what you have to know about this one more reconspiratorly, turnentlye 200-day moving look at this you take the line back, that was the peak in the stock in 2014. this is five-year resistance for the stock, 71. if energy is going to, would, you are getting softness in the dollar on a fed hike, i think you are set up for a big breakout in the share price of one oke. >> is one oke really for one oklahoma >> i believe it is. >> wow i had no idea. i wondered where it came from. serious question though, ari -- not that that wasn't serious, but we were talking earlier in the show about visa and mastercard and the financials doing so well. pete was expressing concern over valuations what do you see in the charts? >> these are high -- you know, they've worked you are talking to someone who
5:32 pm
loves leadership, plmelissa. these are stocks with high momentum they've been extended the entire way up i would say stick with them. i think they continue to do well really no signs of topping out i mean the assumption should be high or lows followed by higher highs. this is a point in the cycle where a lot of the high momentum names start to accelerate, we've done work on, in general being what we think is a secular bull market to be led by the higher growth companies they have that tail wind to them as well in the broadly strong tech sector. we still like those names. >> ari, thank you. ari wald of oppenheimer. guy, where do you go >> tremendous work by ari. >> what do you like? >> ari knows it is potentially a huge double top from 2014 at the 72 level i would rather buy a breakout, i would avoid that j.p. morgan is trading almost 72 times tangible book. in my world they deserve the premium, i think it is too much.
5:33 pm
i would look at square they report basically higher lows think out of those, sq gets you done. >> i think banks get a yield curve that's steepg. you see the fed cutting and i agree with ari going higher on rates. >> next up, a new and possibly less volatile way to play cryptocurrency would you believe retail hit an all-time high today? we are checking out the trades on the teen side of the trade. a shakeup in the health care sector which is now worst performer of the year. see what he sees next on "fast money" live from times square. (soft music)
5:34 pm
- when i see obstacles, i create opportunities. - when i see adversity, i find a way. - when i hear never, i say now. - [announcer] southern new hampshire university is education made to fit your goals with over 200 degree programs, flexible class schedules, and some of the lowest online tuition rates in the nation. (cheering) - so when i face barriers, i can break through. - [announcer] breakthrough at snhu.edu.
5:35 pm
monitor their blood glucose every day. which means they have to stop. and stick their fingers. repeatedly. today, life-changing technology from abbott makes it possible to track glucose levels. without drawing a drop of blood, again and again. the most personal technology, is technology with the power to change your life.
5:36 pm
life. to the fullest. women come back to "fast money" take a look at the health insurers soaring today as the trump administration scraps a drug plan designed to limit rebates insurance companies receive from drugmakers, eli lilly, pfizer taking a tumble on today's decision but the president indicated there are more proposals in the pipeline to reshape the sector. where do you place your bets on this pete >> i'm not a happy camper on the fact i'm long on pfizer, merck and a couple of names long in the space.
5:37 pm
i think it will create an opportunity because they put a good hurting on day one of the news, right? it is a good shot to the down side so i'm looking at it saying, you know what, usually there's no one-day events normally. i will give it two, three days and see what p has out of these, but it feels oversold in terms of the reaction for them on the other side i think some of the providers, i think there's plenty of upside still after a day like today whether it is cigna or names like united health. >> you are in one, right, karen? >> i'm in anthem i had anthem for a long time, bought some when the democrats sort of were talking about dismantling the whole structure, and then sold it probably -- well, too early. but i was a little perplexed by the action today in that, okay, i get why the pbms and the insurers were up they get to keep parts of the rebate what i don't get is why the administration changed so quickly and, you know, it seems somebody sort of got to them why will that not happen with the drug companies as well, right? so i agree with pete i think that it was an
5:38 pm
overreaction i wouldn't be surprised if they too found a way to keep the current system in place. so i think that's probably a place to look. >> so pull backs in this space would be opportunities then? >> yes, i think so. >> if you think that every attack eventually will be defeated -- >> well, that's been the way so far, that's been the way to bet. >> right. >> so to me that's where i would be looking. >> you know, when you look at big pharma, it should have been a market environment where they should have out performed because they're great balance sheets, it is an environment where people weren't chasing growth and decent valuations, except if you look at lily and pfizer these charts have been kind of sick lilly is a level where it needs to hold around here. the valuations in the companies have remained reasonably attractive in the market environment and the headlines dogged these companies for years. i would not get caught up in that ultimately i think you have to look at the pipeline of the companies. that's what is driving the multiple.
5:39 pm
>> pipeline like biotech >> i'm wrong all the time, as you know. >> not all. >> all the time. >> if you were wrong every single time it would be unbelievably valuable. >> it would be. >> you should work harder to be wrong. >> we got this one right, and it is unh we talked about this one for months completely overdone to the down side we said it to the time when it troughed it was trading at a 13 multiple which is at the low end of the curve now it is at 260 i'm with pete, it goes higher. without question i believe it goes higher because i don't think their earnings have been affected at all. i think the multiple is too low. in terms of big cap pharma quickly, i agree as well i think it is ridiculous to tell off. i understand why it happened, but in a week and a half, two weeks from now i believe we will be saying the same thing about pfizer, lilly and merck as we did two-and-a-half months ago. >> what would you rather, pete najarian big cap pharma or biotech or does it not make a difference? >> they are becoming closer and
5:40 pm
closer but i prefer big cap pharma i think there are great pipelines out there and obviously the biggest issue all face is anybody who actually goes in the world of alzheimer's, when they fail, which they do, they get slammed to the down side but other than that i think the pipelines look solid. >> well, there was a surge of options activity in the health care space today dan has the options action for us what did you see >> it was in the xlv health care select evf, a lot of the names are big components in it it is only up 9% on the year and obviously unh on a day like today helps out but the pharma names were slammed today the activity was on the put side there was six times that of calls and appeared to be a couple of rolls out of july puts into july 26th weeklies. so today when the stock detail was trading and 93, a seller of 5,000 of the july 1992.5 strike puts and buying 2500 of the july 26th. extending the time horizon out a week, paying about $0.61 for
5:41 pm
this when i look at a trade like this and the components in this etf i say to myself it is likely a holder buying short-term protection you get the momentum move. tim talked about lilly at a level, this stuff has the potential to snowball, especially when tape bombs are coming out of washington there's a one-year chart right there. it had a nice bounce over the last month it has consolidated a little bit between 92 and 94, which might be one reason for the choice of that 92 1/2 strike let's look at the five year. it has not had the outperformance some of the other s&p sectors had here but consolidated between 85 and 95 over the last year or so so to me looks healthy we know there's a lot of good balance sheets in there and also a lot of headline risk in that sector to me, i look at this activity and say it is probably short term protection. >> more "options action" on the full show friday at 5:30 p.m. eastern time. >> karen finerman will be on "oa" next week how exciting is that
5:42 pm
>> i'm thrilled. >> it is quite a preview. >> it is unbelievable. >> hang in there she will be there. >> yes, two fridays from there team retailer american eagle jumping on board the cbd craze and a new deal to sell the products in store but will the millennial bet pay off for investors? joining us to talk all things crypto after the first ever approval of a digital coin ofrifeng it will layout what it means for the cryptocurrency space we have that and more right after this ♪♪ ♪♪ ♪♪
5:43 pm
5:44 pm
but i can tell you liberty mutual customized my car insurance so i only pay for what i need. oh no, no, no, no, no, no, no... only pay for what you need. liberty. liberty. liberty. liberty. ♪
5:45 pm
welcome back to "fast money" the cannabis craze is heating up as retailer american eagle announces its plans to sell cbd-infused body care products in store through a new deal with marijuana company green growth brands it is the third partnership for the cannabis producer, joining abercrombie and fitch and designer brands. could it give retailers a spark or will the plan go up in smoke? karen? >> i have to say i'm pretty skeptical of it. i don't know i feel like it is a craze, right? i just think retail, it is so
5:46 pm
tough right now. you have to have the right product at the right price and the right merchandising. i don't know that cbd is, you know, the magic answer. >> the answer. >> right but i'm not a teenager looking to be quasi high so i don't know. to me it wouldn't make me become a buyer of the stocks. >> to be fair, cbd doesn't get you high. >> you don't get quasi high. >> you don't get high at all. >> not at all. >> and relax -- for instance, the -- >> the dsw angle is that for women who wear high heels it is said that it alleviates some of the pain associated with wearing high heels. >> no kidding. >> ointments. >> no kidding? >> it seems like a deal better for a green growth brand. >> who also has a deal with greg norman and certainly is out there licensing cbd products, you know, it has not been a great run for that stock either. i think you are getting to a place where people are trying to evaluate, first of all, the fda still hangs heavy over the entire cbd market and affects
5:47 pm
where a lot of the companies can distribute, even now post-hemp bill i think you have to be careful on cbd i do believe in the efficacy for a handful of uses which include anti-anxiety or sleep aid or pain relief. i think people are finding different ways to use it i don't think a retailer needs to jump in there and throw this stuff at their counter and think it will change their business. >> completely agree. i would say it is great for the distributors on the other side of it but i look at the rest and say why are they in it does it move the needle for some retailers? does it change things in terms of what they do for earnings and everything else? i don't think it is great for them i think it is for those distributing, it gives that much more exposure wise in terms of the teen retailers, i don't see that shaking it up coming up, bitcoin had a wild run this last month and one crypto expert will reveal what could be the big key to the next crypto rally there is jim, getting ready to
5:48 pm
reveal why fedex could be bottoming out and this could be your best chance to buy the stock. th'st e p tat athtoofhe hour. live in times square in new york city, much more "fast money" still ahead. ♪ is where people first gathered to form the stock exchangeee, which brought people together to invest in all the things that move us forward. every day, invesco combines ideas with technology, data with inspiration, investors with solutions. because the possibilities of life and investing are greater
5:49 pm
when we come together. ♪
5:50 pm
welcome back to "fast money" it has been a wild month for
5:51 pm
bitcoin as the cryptocurrency soared after the unveiling of facebook's libra the sec has approved the first sell off of block chain capital. thank you for being here. >> thank you for having me. >> we were able to speak to the founder and ceo on "squawk box" and he was reggae plus to do this do you think it reopens the flood gates of capital for the startups out there who might have been otherwise shut out because of the driy-up in the ic market >> i think it is a step in the right direction. after years of stonewalling the industry we are seeing movement from the scc do i think it is going to open up flood gates right now probably not at least not from the reggae-plus approvals.
5:52 pm
i don't think a ton of investors have been sitting on the sidelines waiting for a reggae-plus approval it is only a shade lighter nan the ipo improvement. they're able to get it through. >> you think most companies won't want to go through the process because it is onerous? >> it is you reduce your reporting frequency but most of the same content is still required and we have seen the impact of being public with companies staying private longer and moving to other jurisdictions. particularly the latter within the crypto industry is companies moving overseas. we will continue to see that i think. >> there's a lot of talk from libra from the winklevoss twins to jerome powell do you think like raw will make a difference in bitcoin? will it be the on- ramp because so many people have wallets it will make it that much easier to buy other coins? >> absolutely. libra is definitely a huge catalyst, not just in terms of its distribution but in terms of the partners it is bringing into the ecosystem. we are talking not just about
5:53 pm
large technology companies like facebook, and i would expect others to enter as well, but also financial companies i mean the likes of visa which also joined, and we recently just let a series b round for a custody company that visa made a significant commitment to as well a lot of the large financial players are increasingly serious about the industry. >> hey, spencer. it is dan. back to libra for a second you talk about the partnerships they're having there's been criticism about facebook's issues with privacy and dealing with user data will have actually have an outside role or will they broaden it out and there will be a consortium managing this thing? i expect it will have a huge to-do whether it gets off the ground or not. >> yes look, i think scepticism is always healthy, but i think that facebook truly has become a -- kind of a minority partner of this and a much larger consortium that i think is going to continue to get larger over time. i think it is good to be skeptical but i think they will be able to launch it will it be exactly as described
5:54 pm
with exactly the same partners as announced remains to be seen, but i think the chances they don't get something off the ground is extremely slim. >> where do you think bitcoin goes from here i feel like now that we've seen a rally all of the bulls are coming out of the woodwork saying we're going to reclaim past highs, et cetera. what is your opinion >> definitely. we will definitely see new all-time highs, probably over the next 12 to 18 months i think that much larger targets are in sight here as well. look, when bitcoin first made parity with the dollar, when it first hit $1, to say it was going to ten was crazy and to say at 1,000 was crazy today sitting here at 10,000 to say it is going to 100,000 is not crazy. >> the volatility we have seen in the past few months is probably one of the number one reasons the scc will never approve a bitcoin etf. it is sort of a double-edged sword. >> i think they will eventually
5:55 pm
approve a bitcoin etf and it will be a catalyst granted, it is round around about companies launching direct ability to buy bitcoin whether through robin hood or some of the other major brokerage firms will make announcements over the next few months. a bitcoin etf would be huge but it is mitigated by the alternative efforts. as far as volatility goes, yes, it is down some 10% over the past 48 hours but up over 200% year-to-date yes, it is a volatile asset. it is a byproduct of any asecretary with absolute scarcity but fluctuating demand, particularly one like bitcoin early in the on- boarding stage. >> spencer bogey art, block chain capital. karen, you still have bitcoin out there. >> i do. yes, hold img out. last year, terrible. this year, great it is interesting though it seems to me it is more about the central bank issues around the world, right and then you see events like
5:56 pm
erdogan firing his -- you know, things like that to me make the case for it. >> right. >> it could all blow up again, but i'm staying long. >> all right up next, final trades. this is his family, the world he's built, for 72 years. ♪ this is hal's heart. it's been torn. broken. and put back together. this is also hal's heart. this is the cardiologist his brother recommended. and this is hal's relief, knowing he's covered. this is hal. his heart and memory keeper, and it's beating better than ever. this is what medicare from blue cross blue shield does for hal. and with easy access to quality healthcare,
5:57 pm
imagine what we can do for you. this is medicare that cares back. this is the benefit of blue. you mighyour joints...ng for your heart...
5:58 pm
or your digestion... so why wouldn't you take something for the most important part of you... your brain. with an ingredient originally discovered in jellyfish, prevagen has been shown in clinical trials to improve short-term memory. prevagen. healthier brain. better life.
5:59 pm
sponsored by interactive brokers. ♪ time for the final trade pete. >> a story that didn't get talked about enough today, delta airlines it was a great earnings and, boy, i think it is going to gitty-up towards 70 in not too long. >> pete had three final trades and we have five people to do final trades, i will do it quickly. google. >> karen >> heading into bank earnings season, valuation here as the market goes higher, the valuation spread is wider. i like j.p. morgan and love jamie diamond. >> it is confusing because we have five. we have to share cameras be nice, share caring is caring dan? >> you don't get nearly as many things wrong as you like to say you do >> ah. >> it was really nice, a nice breakout of a long-range and i think you get a little more to the upside here. >> isn't that nice at the end of the show we all get together >> we all get out.
6:00 pm
>> we should hug now. >> all get out. >> a "fast money" hug. >> i could use a hug. >> guy >> wrap it up. >> a lot of people say i'm square, but they're right and this stock is going higher, mel. >> that does it for us see you back here tomorrow at 5:00 more "fast money". my in addition mission is simple, to make you money. i'm here to level the playing field for all investors. there's always a bull market somewhere and i promise to help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. welcome to cramerica i don't want to make friends, i want to make you money my job is to entertain and also teach. call me or tweet me at jim cramer you know what i thought today as the dow gained 228 points bursting through the

47 Views

info Stream Only

Uploaded by TV Archive on