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I'm Scott Wapner, and you're listening to CNBC's Halftime Report, the podcast, the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in.
Carl, thanks so much. Welcome to the Halftime Report. I'm Scott Wapner. Front and center this hour, the markets that stick the inflation report, what all of it means for this record-setting rally. We'll discuss and debate, as always, with the Investment Committee. Joining me for the hour today, Joe Terranova, Shannon Sikosha, Steve Weiss. We will check the markets. We are well off the lows, as you know. Those guys are just talking about that. Yes, it was a hotter-than-expected CPI.
The Fed chair is still on the hill. We're monitoring that. Mostly the same of what we got yesterday. No hurry to do anything on interest rates. And obviously the CPI underscores that. I mean, the market's sort of looking through this, taking it in stride. I mean, you had kind of the same thing at the beginning of 23 and 24, which is why the market knows that.
obviously, and is trying to keep its eye on the prize, so to speak, of what's likely to come in terms of tax cuts and everything else. So you're accurate in saying the market is looking through this. I would agree with that. But mostly. Right. But if we think about it, I think it's more about certain stocks which are looking past this meta higher once again today. Palantir higher. Spotify higher. Applovin higher. So I
I think there's some resiliency when you're able to go bottoms up and actually look at individual stocks itself. And I've been encouraging the viewers year to date to think about doing that. Let's not focus on where the overall market is. I think that's going to be a difficult game to play in 2025. In fact,
If you go back over the last 60 days to December 12th, I think we have a chart here to show of the S&P and the NASDAQ. We're basically running flat. We're basically flat in the overall indexes themselves. So I think it's about where can I find some opportunities in the market? I agree with your overall
assessment. Look, Scott, there's a lot of uncertainty right now. There is so much uncertainty. The last several weeks, we've had to deal with deep seek. We've had dealing with tariffs. Now we're dealing with an uptick in the CPI. And all of that should give you, rightfully so, some form of trepidation. We're still in an overall secular bull market. But
But don't focus on, hey, I'm just going to ride the index higher. Try and find some individual stock opportunities until you get further clarity. By the way, if you do, because I don't know where you're going to. The S&P and Nas are on pace for their third straight negative week. I mean, it underscores, Shan, some of the problem that tech has had and why it's dragged everything like that.
a little bit lower. Larry Summers, the former Treasury Secretary, posts on social, we're now in the riskiest period for inflation policy since the early Biden administration. Ken Griffin yesterday, I'm sure you've all seen the quotes by now from that UBS
conference talking about the president's rhetoric and some chaos and tariffs, etc., saying the damage has already been done. From my vantage point, he says, quote, the bombastic rhetoric, the damage has already been done. It's a huge mistake to resort to this form of rhetoric when you're trying to drive a bargain because it tears into the minds of CEOs, makes it difficult for multinationals. And I mean, look, it's a big Republican donor. He voted for the president, but he's telling it how he sees it. One of the world's great investors. The market doesn't seem to be hung up on that.
It doesn't seem to be hung up on what Summers had to say. It doesn't seem to be hung up on what Mr. Griffin had to say. As I said, earnings are better than expected. We're more than two-thirds of the way through, and that's where the eye on the prize remains. Good earnings.
Good economy, tax cuts coming, so why get negative now? Well, I think that's what you really need to focus on is if we look at the last couple of years, Scott, it's really been driven, a majority of the gains last year were driven by multiple expansion. And so if we're looking and anchoring ourselves, to Joe's point, on looking at the underlying fundamentals and the ability for these companies to grow their earnings, if you think about some of the thrusts that are behind that,
Taking tariffs aside, because our view is that they really are a negotiating tactic and the White House is looking to extract some concessions from our allies and our trading partners. If you look beyond that, what you're looking at is you're looking at an environment where things like deregulation are going to benefit smaller companies. If you think about deregulation, if you think about regulation in general, it benefits bigger companies, right? They've got the funds to be able to
have that competitive mode around their business. And so we think this will be more competitive. Around the other parts of the economy, to Joe's point, if we think about technology and where people have been trying to position themselves within technology, you're looking for which of these Mag 7 do I want to own? And now we're starting to see some divergence. You're seeing opportunities to get outside of that in tech, but more importantly, you're seeing earnings growth in other parts of the economy. So I
I think when it comes down to it, you're looking at where is the potential for the market to potentially go up and down. I think that's less of the argument today. The last thing I would note, Scott, is that when we look at this dynamic around the potential for broadening of the economy, a lot of the forces that we've been looking for, this economic momentum, it's all in place. We're seeing it over the last few months. Small business confidence, Scott. You talk about CEO confidence.
small businesses are much more confident in this environment than they have been. And I think all of those things really point to don't spend as much time looking at these larger indexes. Look at the underlying fundamentals. Look at things like even in the Russell 2. I know you're going to come back to me on this and pressure me on this. But, you know, that index itself is not very high quality. So looking within small companies that are higher quality in that universe that are growing earnings this year. You know, Weiss, you look at the sector breakdown year to date. It's nicely split.
you know discretionary is negative tesla has a lot to do with that technology is negative really those are the only two spaces to look at in large part because of what i wish i came up with this uh because what the wall street journal talked about yesterday the lag seven
not the Mag 7. And it really has been lagging performance from most of these names outside of Meta, which as you know is going for its 18th straight day of gains. That's the longest upside streak for any Mag 7 stock, any NAS 100 constituent going all the way back to 1985. That run's been extraordinary.
Amazon's had a nice little move of its own. Everything else is negative though, year to date. The market, does that matter? If you continue to have a lag seven,
It doesn't matter to me, candidly. Does it matter to the market? I don't really care. I care what the fundamentals of the MAG-7 are and how they're going to perform going forward, not how they perform for a moment in time over an investment horizon. So we can make all we want of it because they're a large part of the S&P, they're a large part of the Q's, but the
The facts are they're permanent compounders, most of them. And a momentary lull in their performance or execution, I shouldn't say execution, they've been executing pretty well, isn't going to disturb me. I don't think you look elsewhere. Okay. The operative word is what you just said, momentary. Yeah.
Yeah. Is that what it is? I believe it is. In your mind? I believe it is. Because that's the whole game. Right. I mean, if it's not, you've got a problem. If it is, no big deal. Right. And I believe it is. So if you do bottoms-up work, you'll have conviction that it's momentary and that all the drivers are in place. The spending, which some could argue is way too large...
um is there for the growth it's not to fill it's not to backfill on mistakes that have been made it's to say okay here's where the puck's going we want to we want to drive continued growth so look so i like the max 7 in terms of the overall market you know i'm just not as sanguine about it um
Sure, earnings have been good. No secret. Sure, you know, a lot of companies take price increases in January. Typically, we've seen that before. A little more than usual here. But here's what's being missed. The commentary continues to be, including from this desk,
The Fed is on hold. Well, guess what? Is it on hold for a hike or is it on hold for a cut? I think it's on hold for a cut and there is no evidence at all from either the data, frankly, or what they've said or any of the members have said that it's on hold for a hike. That's not true. No, it is true. No, it's not. Why do you think it's on? Why do you think a hike? What about today's number? That's not evidence.
What do you think the market is? If that was the case, if the market thought that a hike was next. Do you think investing is that easy? Where it's one number, oh, the market says hurrah, you know. I said at the beginning of 23 and the beginning of 24, you had inflation spikes as well. There's nothing from the. So what we need to do to invest, man, is look at what happened last quarter. Are you investing as if you think the next move is a hike? Just put it on the table then. Don't argue. Just put it on the table. Am I? No, I'm being cautious. No, you're not.
you're not that's not the point the point is your point is we got one data point no no that was high no let me finish we got one data point that was high the market's looking through it so hey we're all clear did i say we're all clear well you just said that the market looked through it there's no data that shows that the fed may hike so let me point you what peril said about pal said powell said we're very close to the neutral rate
which means that don't expect a lot of cuts. Now, if inflation keeps going higher, we'll see PPI tomorrow. That'll probably be explained away as well. But if you see this march higher, if tariffs, maybe it's not 25%, maybe it's 10%. That's inflationary, despite what the clown car of the cabinet members say.
So you could very well see increased inflation. Larry Summers is not a fool. He's speaking what's accurate. Ken Griffin's not a fool. So I do think the risk to the market is not maintaining this narrative that's got us here.
what can go wrong. As a responsible fiduciary, I'd like to look at what can go wrong. I'm not saying investing on that scenario. - I am not in any way suggesting that you shouldn't prepare for any scenario. We're talking likely outcomes. The likely outcome is not a hike.
That is not the likely outcome. Maybe it works for you to have this argument with me, which I'm not really trying to have with you, but that's not the base case in any way, shape, or form is the next move is a hike. You've just made my point. It's not the base case. So the risk to that base case of the next move is lower is that it's not lower. It's not even close to that, though. It's extended, right? Scott, I'm pointing out the risks in the market.
You're saying, hey, they're going to cut eventually. Yeah, they could cut eventually. Are they going to cut from 6%? Are they going to cut from where it is right now? I don't know the answer to that. So if everything continues to go as rosy as it is, if earnings continue to grow, you don't think that that's going to be inflationary? Of course it will be. When the economy gets heated up, it's inflationary. So I'm saying don't be sanguine is my message.
I would say the offset to that is that I think a risk that we should be talking about when we talk about tariffs is that there's a point in time increase potentially in prices. But if we see an expansion of tariffs, Steve, to your thesis, we're going to see growth deterioration. So you go back to 2019, Fed had to cut rates. That was, you know, tariffs did not create, they created an inflationary impulse
initially, but then growth slowed down. So I would say, Scott, the real risk to the market from a tariff perspective, short-term may be inflation. I don't think that puts the Fed off of their paws. I don't think, to Scott's point, it puts them on a hike. The longer-term risk to tariffs is growth. And so if you want to be insulating your portfolio against tariffs, I think that that's where you should be looking. We are not in that camp. We're not worried about that because we think tariffs are short point in time, as I mentioned earlier. But
If we want to talk about risks to this thesis and risks to the market, it's growth. It's not inflation. So let's talk about risks to specific sectors. Financials, for example, right?
The thought process was last year, financials did well in that eventually the Fed's going to cut, cut to a level where M&A makes sense, financial sense, because of the typical debt that you put on a balance sheet. Now, that scenario of rates being high continues to be, in my view, a governor against M&A.
You don't know what sectors are going to be... Look, I'm all for cutting costs. There are way too many excesses, way too much overspending government. But I'm also for a cogent, cogently communicated plan of doing it, not sensationalism. And that's what we have. And that's what put CEOs
back on their feet. I've spoken to private equity firms, I mentioned that yesterday. They're not making any big acquisition in certain industries because they don't know what the rules of the road are. So that's a growth slower as well for the financial industry. Financials are among the best performing sectors year to date.
on the expectation of an environment that's going to be more conducive to deal-making, which they still believe it will be. Just because you've had the slowest January in decades for M&A doesn't really portend anything. Obviously, there's been a little more uncertainty introduced because CEOs don't know what's going to happen with tariff policy. Exactly. More tariff policy than interest rate movement from here. It's not only tariff policy. It's not only tariff policy.
Department of Defense. What programs are going to be cut? Where are they going to focus their spending? Yeah, but you're thinking, but that's so stock-specific to things that you have like Leidos and Booz Allen and things like that. Not only them, General Dynamics. Well, but you get my point. In those areas. But that's why I'm talking sectors. Healthcare. Let's talk about healthcare. Another really good performer. Right. Why?
Is biotech a great performer? No. I mean, so you take a look at health care and you say, where are things going to be cut? So right now the markets are on autopilot saying, hey, you know, cut in regulation, et cetera. But there are real cuts going on to the buyers of the services of the companies that are moving higher.
So I feel like we're having a conversation about the Giants winning the Super Bowl next year. Because if we do have to raise rates, I think you raise rates once at best. It's probably an opportunity. But I think it goes back to where you started this conversation. You used the term the lag seven. I disagree that the lag seven should...
should be applied to how most of these are trading right now. Because I think there are some of these magnificent seven that you want to make sure you have in your portfolio. Absolutely Amazon. I think Amazon is on the same trajectory that Netflix was in terms of what it's going to do with streaming.
Al Michaels talked about this last week. Live sports, they are only going to further engage with live sports. It's going to add upon the businesses they have right now with e-commerce and cloud. You turn your attention to Meta. Clearly, they have gained an advantage as a result of what's going on with TikTok. The algorithms are ultimately going to change if someone in the U.S. buys that company. So I think you want to stay with Meta. No one has suggested at all, at any time, that you, to use your words...
should have these in your portfolio. No one has said that you shouldn't have them in your portfolio. They're two different conversations. The simple suggestion is, as a group, it has been the LAG 7. Because I told you year to date, that's why tech is among the worst performing groups. Most of the MAG 7 stocks
are negative except for the two I just mentioned yeah except for the two right now I'm highlighting the two so I'm trying to encourage the viewers if you're looking at the lag seven you think the viewers are sitting there thinking I'm gonna sell I should sell the mag seven because they're lagging let's don't look but let's not look at them in totality
Let's not look at them in totality. Let's try and identify in 2025, they're not all going to go up universally the same as they did in prior years. They're going to be some of those names that are going to perform well. I'll tell you a name that I don't think is going to do well. Tesla. And we own it in Jyoti. I am concerned about Tesla with the tariffs as it relates to graphite. Graphite is a real problem for...
for EV makers when you're thinking about the need in batteries. China's the largest. They have much bigger problems. They have much bigger problems, but the graphite issue is a huge issue, and Elon Musk isn't going to like what he continues to see as we have these tariffs continue to be applied because the margin squeeze is going to happen. Let me just get to a news alert quickly with Pippa Stevens regarding Chevron. Pippa, what are we learning here? Hey, Scott, well, Chevron will reduce its workforce
workforce by 15 to 20 percent beginning this year with most of the cuts complete before the end of next year. The company said this is in keeping with its prior announcement to reduce costs by between two to three billion dollars by the end of next year. It of course comes as Exxon also looks to cut costs with both companies reporting Q3 profits that were down on lower commodity prices. This news was first reported by Barron's and Chevron is cutting its workforce by between 15 to 20 percent. Scott.
All right, Pippa. Thank you. We'll keep our eye on shares of Chevron, obviously, for the remainder of our program today. Let's talk about some other groups rather than continue to have this debate about inflation and otherwise, because I do want to get to some things. We've talked a lot about just silence that about momentum of late. Jeff DeGraff today says it's not overbought.
even though a lot of these stocks are up a lot. Joe mentioned Palantir's up 67% over one month and Applovin he talked about up 18. Goldman's up 16, Weiss you're in that. Welltower a new record high today. Walmart is up 10% in a month, it's in the JOTI. Price target today to 115 from 105.
Carvana's up a bunch, Robinhood, GE, Costco, Royal Caribbean, AbbVie, Netflix, some of the cyber stocks. What's going on with momentum? So you want to use the term overbought?
I would say I disagree with that. DeGraff said it's not. I would disagree with that because I'm beginning to see in the last several days, as we see the overall index kind of teetering, that a lot of the momentum names and momentum strategies are underperforming for the first time this year. So I could tell you if you look at the factor of momentum, the last two or three days have been a difficult day. Al likes your shout out, by the way. Relative to Al, I said thank you very much. Relative to everything else, relative to everything else, okay?
Momentum is struggling. Now, are there areas, as I mentioned at the top of the show, like Spotify, like Apple 11, like Palantir, like Walmart, that you could still find opportunities? Yes, without question you can. But if you're looking at the factor overall of momentum, it does appear to be a little bit tired. It does appear as though it needs to catch its breath. And price action the last several days has
Absolutely reflecting that. Invertive is part of the momentum trade, which is getting hammered today as our chart of the day. But you bought more.
Well, keep in mind, I said yesterday I was going to sell going into the earnings. I sold part of it. And you bought it back on the dip? I bought it back this morning. It was down more this morning. I bought it back this morning. Look, the quarter was pretty good. The issues were a couple of things. Quarter was actually, I thought, excellent. Where do you see companies growing at 30 and 50 percent in different metrics?
But the book to bill for the fourth quarter, not unusually, it was one to one. It would have been nice to see that higher. And the conference call really hasn't done anything, which I listened to partially before coming on air, to, you know, once the die is cast and it's down, it's down. But everything remains in place for this company to continue its growth.
So I'm still there. I bought back what I sold. That was a good sale. Would have been better sales, I said, if I sold it all and came back in. But I didn't know how the quarter would go. Quarters are just very, very fickle, as is the reaction to them.
And there's no rhyme or reason. We see stocks that miss and the stock goes up. We see stocks that execute and they go down. So the best thing is pay attention to the quarter for trends. But if the trends are in place, then don't get knocked down. That's an important point. Scott, you mentioned before how important earnings have been to where price has traced out over the last several weeks.
are a variety of different stocks like Vertiv that actually have reported really good earnings, went into their earnings at or near highs, 52-week highs or all-time highs. And subsequent to that, the response
left you puzzled because they weren't adequate earnings, but maybe they weren't good enough. So if you could pull up a chart of Eaton, you'd see the same thing reported at the end of January. Chart looked really good. Earnings were good. Stock rolled over. Look at Decker's. I mean, you and I have talked about Decker's for the better part of the last six years. If you pull up a chart of Decker's, it has literally hit the deck after earnings and the earnings on it were not very good.
I do have some breaking news from Washington. We will get to Megan Casella for that. Megan? Hey, Scott. We're just learning from President Trump posting on Truth Social that he just held what he called a lengthy and highly productive phone call with Russian President Vladimir Putin. Now, a lot of details here from the president saying that they discussed Ukraine, the Middle East, energy, A.I.,
the power of the dollar among other subjects. And he also says that the two countries have agreed to work together very closely, including visiting each other's nations. We've also agreed to have respective teams start negotiations immediately and that he would start those including by also calling right now Ukrainian president
Volodymyr Zelensky to inform him of the conversation. So that's coming now. As we know also, Scott, that Treasury Secretary Scott Besson is in Ukraine meeting with Zelensky today, so potentially launching those negotiations. Trump saying in this True Social post that Secretary of State Mark Rubio, John Ratcliffe of the CIA, Michael Waltz, the National Security Advisor, and Steve Witkoff, the special envoy, will be leading those negotiations. So we don't know exactly yet
the contours of those, what exactly that they will be discussing. But of course, this follows the prisoner swap that we saw American Mark Fogle coming home last night from Russia. So following on all of that and building on Besson's trip to Ukraine today, Scott, that's what we have for now. Back over to you. All right, Megan, thank you very much for that update. That's Megan Kinsella on that important conversation that the president just had.
Let's get to a couple more moves, Joe, if we could. So you bought CVS. Yes, I bought CVS. Why did you do that? Kudos to Larry Robinson, Glenview Capital, who took a position in this stock a few months back.
So finally, you're seeing some positive momentum here. You have the earnings growth. You have a reduction in cost. And I think this is an easy trade. Remember, I use the word trade more than anything else. You want to buy this against yesterday's closing stock price, which was 55. If you're trading it, if you're an investor, you have enough here to believe that
that there is a fundamental turnaround in this story. I haven't owned this stock in years and I've been waiting for an earnings report like we got today where you could say to yourself, okay, fundamentally, this looks like an inflection point and certainly technically with that large gap open higher, it's worth taking the risk. - The Tepper convinced you on Alibaba? Is that why you bought that? - Listen, there is clearly right now-- - I'm completely serious. - No, I know you are.
You don't go against David Tepper, but we had a nice conversation about it Monday. You think Weiss is the only one influenced by what he says? No, I think everyone who trades and invests is influenced by David Tepper, for sure. The reason why I bought it is we discussed it on Monday. We talked about JD. We talked about PDD. We talked about Baidu. Yes, we talked about all.
All of those, as a matter of fact, because he upped his positions from his 13F that we got on Monday. What I did was I went back. By the way, I love that tie jacket combination. Continue, please. I went back and I looked at where are we with momentum and where are we with the potential for momentum to extend itself. And if you look at BABA right now, it just took out its recent high from the last six months above 118 and change. And it looks like now it has a path towards 150. So more than anything else, we could say, yes,
Thank you, David Tepper, for introducing the concept, the idea to me. But looking at the momentum, it looks really strong and it looks like it could go to 150. And I want to try and capture. All right. Good stuff. We'll take a quick break. And when we come back, Carrie Firestone is going to join us. She's just made a number of moves in her portfolio. Some new buys, new trims of positions, and she sold a name as well. We're back right after this.
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All right. I told you Carrie Firestone has made a number of new moves in her portfolio. In fact, she has and she joins us now. Hi, Carrie. Good to see you. Thanks for coming on. Hi, Scott. All right. So let's go through these. You bought more. I said there were three. Let's do one at a time. EPAM Systems. Why'd you buy more now?
It's a software consulting business. That business is starting to improve. Number one reason is that they moved everyone out of Ukraine. It was Ukraine-centered. It's not anymore. And business is starting to pick up to integrate AI for a lot of their customers. You know, we'll keep an eye on the stock, getting a little bit of a move, trying to go positive. You know, another one is Broadcom. I need to tell you, obviously, how the chips have traded. Broadcom and NVIDIA, though. NVIDIA's had a nice little bounce back. Why did you buy more Broadcom?
Well, we've owned it and we looked for an opportunity. The stock had traded down some and it's essential in terms of integrating for data centers who really need to use more chips for AI. It's equally a growth story the way NVIDIA is and it was an opportunity and so we took it to buy some. Okay. Kemed?
Yes, so ChemMed is in the hospice business, Strange Mix Hospice. They also own Roto-Rooter. And the hospice business is growing nice double digits. We think that's going to continue. And the Roto-Rooter business, which was always historically a strong business, has been sluggish and it's starting to pick up. And we think, again, it gives us an opportunity for steady growth in a choppy market. Why did you take some, I mean, look, health equity, it's a record intraday high today. Is it, is
Is the story any more complicated than that as for why you decided to take some profits here? It's pretty much valuation. We've owned this name for years. It's done exactly what we wanted it to. It has been a play, as with financials, on better economy, full employment. They're in a health savings business and higher interest rates do help them. It's just a fairly big position. We took some off the table. The floor obviously likes the timing of your move. Wabtec, you trimmed that as well.
Yeah, I think that was lucky because we did trim it before the earnings. This is a company that's in the rail car business and rapid transit. It's a really high quality industrial. It's been a strong stock. It's outperformed. And we just, again, trimmed it. And I think that it was the right move before earnings, which were a little disappointing today.
Okay. You own Wabtec, Joe, right? Yes. What do you think of taking some profit here? I think it's obviously pretty good when the stock is down 9%. Another example of a name at or near an all-time high. Here you go, 2025 guidance is light and the street is going to punish you. So if you are at an all-time high, Steve, you better make sure you blow off
earnings and guidance. You know, rarely have I ever seen such emotional acceptance of any moves as Carrie's made by the applause in the background. Well, it certainly has never happened with you, so your applause is obviously something out of the ordinary. You mess with the bull, man, you get the horns. Carrie, you also sold Fortiv.
Yeah, so Fordiv was a name that we bought a few years ago. It spun out of Danaher. It was very high quality, precision industrials. Danaher Management, we had experience with that company and that management group, and we thought it was a great idea. In fact, they've made acquisitions that we haven't loved. It's
They've grown earnings, but not to the extent that the market expected. And now they're going to break up the company. And we really don't love that strategy. So we think we have other opportunities with high quality industrials in the next few years than this one.
All right, Cara, thank you again. We'll see you back on the desk soon. That's Carrie Firestone joining us with these new moves. So the headlines now with Silvana Hannau. Hi, Silvana. Hey, Scott, good afternoon to you. The U.S. reportedly agreed to send a convicted Russian money launderer back home in exchange that freed American school teacher Mark Fogle.
According to NBC News, Alexander Vinnick is currently in U.S. custody and awaiting transport back to Russia by the end of the week. He will leave behind $100 million worth of digital assets as part of the agreement.
The full Senate voted to confirm Tulsi Gabbard to become the next director of national intelligence. She had one of the most contentious confirmation hearings of President Trump's cabinet picks so far. She faced scrutiny over her defense of whistleblower Edward Snowden after declining to say whether his actions amounted to treason.
And the bank transfer app Zelle reports it topped $1 trillion in payments last year as more customers turned to the instant transfers over making cash or check payments. However, the rise in its use comes as Zelle faces accusations of failing to
properly investigate fraud complaints and reimburse victims. Scott, I'll send it back to you. Silvana, thank you for that. That's Silvana. And now coming up, we're going to talk about some of the day's biggest movers. That's committee stocks. We've got some good calls to get to as well. We'll take a quick break and we will do it next.
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All right, welcome back. We'll show you Lyft and Uber. We don't really have much to talk about as it relates to Lyft because there's no ownership. Stock was down a bunch yesterday on those earnings and the booking guidance. But Uber obviously has ownership here. Weiss, I'll give you the first one on this. You know, the stock has been so uneven lately, big down and then big up on the Ackman revelation that he had taken this position. What now?
So look, to borrow a word from Joe's lexicon, there's momentum here. And that momentum is going to continue to drive the stock higher. They are executing. Execution hasn't been as smooth as it was about a year ago, but there are always bumps along the road. And I do believe it's a unique company.
Lyft, I'm actually surprised it's where it is. This seems to be a one-player universe. And while Lyft is talking about autonomous cars, robo-taxis, that's going to be a commodity. And what they still haven't solved for is the cost of putting robo-taxis on the street. Nobody's talking about that.
And again, you won't have the drivers paying for the insurance, you won't have the drivers paying for the maintenance, you won't have the drivers paying for the EV essentially. So that will hit profit margins and so we gotta hear about that.
That could potentially be disastrous for Lyft if they have to assume those costs instead of drivers assuming them. And the momentum in Uber has gotten even stronger this week. Normally, when you see something like we had last Friday, big spike move higher, you say to yourself, OK, that's a little bit of exuberance. And you'll see it pare back and do a little bit of corrective behavior. Has not done that at all.
hasn't even approached where it was coming into friday the momentum's building going into the 80s i think clearly right but just to be clear my point so they won't have the drivers to split the cost of the ride with the fees but we don't know how much that is versus how much the cost driving is so until we see that worked out we don't know what the profitability of either company is going to be going for a risk to networks uh under some pressure let's show the stock
There's some suggestion that the weakness that you see on your screen could be due to possible insider selling, that the chief technology officer and the senior vice president of software engineering sold 160,000 shares on February 6th.
That's what I have in front of me here, Joe. Okay, what's important here is that earnings are next week. You're talking or needing a 63% margin. You're talking about 20 plus revenue growth, really approaching 25%. You're talking about at least 16 or 17% EPS growth. Options market pricing in 9% move, which is a pretty big move. I still think they're participating in the AI networking build out. I like where it is in
in terms of already experiencing a little bit of correction after deep seek i think it's in a good place here and adequate earnings you should get a positive response all right travelers they expect a pre-tax catastrophe loss of 1.7 billion from the fires out in california you own the stock yeah we're getting clarity here i think allstate now comes in at 1.1 billion chubb rather comes in at 1.5 billion i think for each one of these insurers that price has already factored in
these catastrophic loss numbers already. Berkshire's buying more Oxy. The stock's down a lot from last April when it hit the record high. What do we, you own the stock. I think this is more about Oxy. I really do. I think this is about Oxy and this is how you have to think about it. So Berkshire takes the stake up now to, I think, somewhere around 28%.
But it seems as though when Berkshire made the last purchase in December, they seemed to like this level, $45, $46, $47. I think $45, $17 is the lowest price it's been over the last three years. So I think that gives you comfort if you're an investor in Oxy that you know you have this quote-unquote investment whale that's going to come in and
find a certain price appealing and that price seems to be somewhere around 45 46 what's your take Shannon on energy which is off to a decent start this year a little less than 5% so it's you know among the it's in the middle of the pack or to the higher end of the pack of good performers yeah I mean we just keep talking about these factors that are going to push energy prices down I mean we saw obviously in the CPI today Scott certainly not that
carry through and transmission. And I think you're seeing some pressure on energy today as a result of some of the potential discussions around Ukraine. So I think that in the near term, certainly from the Trump administration's perspective, they want to pull energy prices down. And if we get resolution in Ukraine
of any different variety, I think we're going to see some pressure and a ceiling for energy prices. So I think that's going to flow through to the stocks over the next couple of months. Sorry to interrupt you. We've had a very busy day down in D.C. from the Fed chair on the Hill once again, just some news out of the White House. We have more, in fact, from our Eamon Javers. Eamon?
Scott, that's right. Speaker of the House Mike Johnson at the other end of Pennsylvania Avenue is saying that he believes that Donald Trump is considering reciprocal tariff exemptions for the pharmaceutical and automotive industry. The Reuters reporting that Johnson said on Wednesday he believes Trump is considering exemptions to those tariffs specifically for those two industries. Not clear whether that would be entirely acceptable.
exempted or individual products exempted within that industry set of imports. We'll have to wait for more detail from the White House, but I can tell you, Scott, that I talked to Kevin Hassett this morning here at the White House. He's the National Economic Council director, and he said that he's been making phone calls to foreign
leaders to talk about reciprocal tariffs. He was on the phone, he said, as early as, as recently as this morning with foreign leaders talking about how those tariffs would be structured. He said Howard Lutnick over the Department of Commerce is also making calls with foreign leaders talking about the structure of those tariffs. It did not sound from that conversation that I had with Hassett this morning that they are prepared to announce reciprocal tariffs as soon as today. What Hassett said is they might announce prior
progress on reciprocal tariffs today or tomorrow, but not the imposition of reciprocal tariffs today or tomorrow. So some nuance there, but some important nuance in terms of what it is they're thinking now. Speaker Mike Johnson saying those exemptions could be coming for the pharmaceutical and automotive industries as well. So some moving targets here in terms of when these tariffs are coming, what they might be tariffing specifically, and which countries might be affected. Scott.
It would be welcome news, obviously, for the likes of Jim Farley, the chief executive officer of Ford, Eamon, who you know in the last couple of days has been lobbying pretty hard against tariffs and what it would mean for the auto industry. It was just a day ago or so where he suggested that this talk is causing, in his word, chaos in the auto industry, could lead to layoffs and the like. And I'm sure you've heard similar from others within the auto industry as well. Yeah.
Yeah, and you saw Ken Griffin of Citadel making some comments about the sort of chaos that the tariff talk has created in terms of U.S. trade relationships around the world and whether the United States is a reliable trade partner or not. So the White House seems to be calibrating all of that. You know, I can tell you that earlier in the week we were given the impression that those reciprocal tariffs were coming as early as Monday.
That hasn't happened yet. And what you're hearing from folks like Kevin Hassett is that a lot of these negotiations are still ongoing. So clearly there's a window now for people to weigh in with this White House and make the case that these tariffs either are going to be damaging if they're put in or should be put in with exemptions that leave them out of it, frankly.
or whatever the lobbying might be. But a lot of that is going on behind the scenes. You get the sense that, you know, the phones are burning here in the West Wing as different industry groups try to get this administration's attention. Yeah, no doubt about that. Good point, Eamon. Thank you. That's Eamon Jabbers at the White House, as you see. Santoli, as in Mike, is here next with his midday word.
We're back. Senior markets commentator Mike Santoli on the desk for his midday word. What are you thinking about today? Interesting how the market, you know, kind of sought not to overreact to CPI. It just never broke containment, right? The lows of the day in the S&P was well within the week's range. The yields are up, but they haven't blown out to the
to the recent highs. Whether you can massage the numbers and say that makes sense because it was some one-offs or not, what I find interesting about it is the rotation takes you into some weird places. You got some regular old defensive sectors, and then you got the craziest lowest quality
junk flying as well. I think part of that is upstart, massive upside reaction to its results last night. Crowded short, every other short gets covered on a day when you thought it was going to be risk off. So there's a lot of that still running through this market. And until we get toward maybe February expiration,
It seems like the market's a little bit kind of pinned here in a range. Yeah. And we said, I mean, for the most part, earnings continues to be the story. You wouldn't have a market that looked like this if you had a bad CPI and a bunch of bad earnings. That's right. No, we're absolutely supported by the earnings flow and even the here and now economic numbers. I mean, you're fine if the Fed's on hold and you're growing at two and a half percent.
You just have the tariff uncertainty that more people are talking about, whether it's Griffin or Farley or whoever. It seems like the market's trying to build up some calluses against every headline. All right. I'll see you on Closing Bell. It's Mike Santoli. Calls of the Day next. Weiss, let's talk some Taiwan Semi because it was reiterated by today at Bank of America. It says deep secrets accelerates AI adoptions. That's a positive for TSM. What do you think?
Look, the story is right for TSM, whatever chips you use, because chances are they're the ones making them. So...
most outsourced to chip manufacturing and Taiwan Semi is the leader in that. So for them, it truly is a win-win as we talked about last week. So I still like it. I still think it's very reasonably valued right here and would add to if it weren't one of my largest positions. Okay. That's a pretty good looking chart as well. Joe, EOG upgraded today to outperform RBC. The price target goes up by $5 to $155.
They say the upgrade is because of quote continued strong operational performance, exposure to improving natural gas prices, premium commodity price realizations and the potential for stock buybacks. The two that I like there are improving natural gas prices and increased stock buybacks. In addition to that, this has had
Strong relative outperformance of nearly 10% versus the energy sector overall over the last 52 weeks. All right, we'll take a quickie. We'll come back. We'll talk about some winners, losers, and we still have final trades to do as well. Let's talk about Iron Mountain. That stock right on your screen here. It's a three-month losing streak. IRM, you own it.
Well, the concern here is its exposure to potential budget cuts. And they are storing documents, paper documents, for the U.S. government. And it's clear, I think last night there was a tweet about it, that Doge could be potentially coming after that. So they report earnings tomorrow morning, and they absolutely have to address this concern.
Okay. I will see you on closing bell, 3 o'clock. Glenn Kacher, the tech investor, is going to join us, so it's a good time to check in with him. Eric Woodring, the star Morgan Stanley analyst, is going to talk Apple with us, Bryn Talkington, and Adam Parker. So I hope you'll join me then. Let's do some finals. Mr. Weiss, what do you got? I'm sticking with Vertiv. I think that the stock got 8% cheaper today, so it's a good opportunity to get in. All right. Shan?
Healthcare, what Joe didn't mention on CBS is that Aetna's MLR came in lower than anticipated. So if we see that for other MCOs, that could be a boost for the sector. Yeah, Joe, why'd you leave that out? I don't know, because I was fixated on your tie and jacket combination. Spotify. You're excused. Spotify, a chart that looks as good as your tie and jacket combination. Thank you very much. Pandering to the host. Oh, man. I'll see you on Closing Bell.
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