The Setup for Stocks 3/17/25
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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. All right. Thank you very much, Sarah. Thank you very much, Mike. Welcome to the Halftime Report. I'm Dominic Chew in for Scott Wapner this afternoon. Front and center this hour, the setup for stocks following the Dow's worst week in a year. Our investment committee is standing by with their respective playbooks. Joining me for the hour,

Joe Terranova, Jim Labenthal and Bryn Talkington. Let's get a quick check on the markets right now. You can see the Dow Industrial is just about up one half of 1%. The S&P 500 may be flat on the session, up about one tenth of 1%. But the Nasdaq, the tech heavier side of things, marginally to the downside. Fractional losses there off by about one half of 1%.

With all of that in play right now, given the volatility that we've seen over the course of the past now two to three weeks at this point, maybe, Joe, I'll start with you and what's got to be a very nice setting for you in Miami Beach, Florida right now. Joe, what exactly do things look like from where you're standing aside from the gorgeous weather compared to up here in New York?

Well Dom, I look forward to seeing you soon down here. Jim and Bryn are obviously very jealous, but it looks as though we've stabilized a little off of last Thursday's S&P 5507 low. Certainly last week CPI and the PPI helped, but I think the theme in terms of investing continues here. It's been the dominant theme in 2025 so far. It's been the MAG-7 are not the ideal place to be overweight.

In fact, it's time to reduce exposure there. The equal weight is leading markets higher. There's other opportunities going broadly across the world, looking in Europe, looking in other places. And landing back in terms of asset classes themselves, Don, it's really been the year of the bond so far. So I think stabilization more than anything else is the word and trying to use that stabilization to generate alpha opportunities.

And Jim, the bond picture is certainly something that many traders, regardless of asset class, are watching right now. We do have that 10-year note yield that has been now moving kind of gradually down towards that 4.25% mark. What does it say to you that the economy is shaping up the way that it is? There is a yield now for long-term government debt in the U.S. that is now going drifting back towards the 4 level, all of which is coinciding with some equity volatility. Is the bond market...

getting it right right now? Well, I hope so, because I really like where the bond market is right now. I think last look, it was 427 on the 10-year and 402 on the two-year. And those are solid numbers that are not low enough that make me worry about growth expectations, at least as seen by the bond market. And they're certainly not high enough that makes me think, hey, maybe the bond market is sniffing out inflation.

So, I mean, I really like the bond market where it is right now. It's stable, and I'm purposely using that word because Joe, who definitely does win the backdrop award today, used the word stabilization. And I think that's what we're looking for in all the markets right now. I think it's maybe a little bit too optimistic to think that Friday was the bounce.

or the bottom rather. We did see that. In August, we had a really quick correction and it bounced right off. Normally, you get a retest of the low. Will you have that this time? I think a lot of that depends on the policies coming out of Washington, D.C., which are, to say the least, unpredictable right now. But one positive thing that I do want to hang our hat onto, the economic data today, disappointed.

Unequivocally, it was disappointing, and yet the markets are higher. That's a good sign that maybe animal spirits are coming back to the bullish side of things.

I mean, they're higher, but for the tech-heavier Nasdaq composite, we're seeing some signs. Of course, a big catalyst week coming up, given what's happening with the Fed, given what's happening with the big artificial intelligence conference that NVIDIA is dealing with, Bryn. Amidst all of that, which is the catalyst, I guess, that you are paying the most attention to as trading shapes up this week? Is it going to be on the macro side with the Fed and rates? Is it going to be more about

artificial intelligence and NVIDIA? Or is it going to be more of this idea that we're going to follow continuously what happens from policy perspectives out of the Trump administration?

Well, I've got my Trump tracker on my desk, so I know when he's speaking. So I think everyone needs to have that to disrupt the market either way. I think the Fed, I think there's no expectation that the Fed is going to cut rates this week. I think what we learned last week is there's a lot of hedge funds that got popped last week, did not have a good week, massive de-risking. And I think that we are going to see, like 2018, multiple drawdowns followed by rallies as

as the trade talks are real just like they were in twenty eighteen and fighting for investors taking advantage of the volatility be able to add to names like I know the three of us did you know last week during that volatility just like twenty eighteen which was uncomfortable to live through there was twenty nineteen when the markets were almost thirty percent and so I think that's my favorite right now is to say

for short term we're going to rally. I think there's a ceiling though on April 1st. That's when President Trump gets his America's first trade policy memo which details all of the countries, all of the tariffs and that's why they keep talking about April 2nd. And so I think that is going to be a ceiling in the short term to any rally to actually move above much of much above where we are going into that April 1st, April 2nd trade policy memo release.

So one of the things I want to highlight right now, there is a prevailing sense right now that there is more caution coming out, especially even among strategists who cover the S&P 500 are attaching targets to them. There's a couple I want to point out on the negative side just to kind of frame up the discussion as we talk about stabilization. One of them is from Deutsche Bank. And Deutsche Bank basically says we see the sell-off in U.S. equities as having further to go.

Equity positioning has been cut sharply, but only from near max overweight to slightly underweight levels. Right. A move to the bottom of the positioning band, which is where it went to the last trade war, would take the S&P 500 down to fifty to fifty. That's their target there. Meanwhile, RBC's Lori Calvacina is cutting her S&P 500 target down to sixty two hundred from a prior sixty six hundred.

She says the U.S. equity market is at a fork in the road, and we think the path that goes down for the rest of the year may be determined by whether there is any change in the policy narrative, how data comes in, and the results and commentary from companies in this first quarter reporting season. So this is not maybe outright bearishness. The world's coming to an end, Joe. But it is certainly one that echoes one of a bit more caution in the coming weeks. And maybe it's justified. Yes or no?

So I don't think you could rule that out in any regard. I think we've seen a dramatic 180 degree shift in terms of sentiment and positioning over the last 60 days. I think it

really extenuated itself last week, if you would, when you saw that CTAs were now moving to bearish positioning in equities. So it depends. It's interesting to me because people always say, well, we're investing for the long term. And that's rightfully so. The wealth management industry, they're investing for the long term. Most of the viewers, they're thinking about retirement. They're thinking about

the long term but market structure has changed so dramatically you have so many systematic trend following uh... systems right now quantitative

information strategies becoming very popular. So embedded within that long-term outlook, you have a very active trading environment. And that active trading environment where we are in 2025 right now is greeted with a tremendous, tremendous amount of uncertainty. And I think what you have to look towards, Dom, is the reaction to...

positive catalyst, negative catalyst in the market and price itself. Think about earnings. Earnings season really strong, really good news, bad price action. Now on the other side of that it seems as though we're pricing at a lot of negativity in the near term but yet we're stabilizing. So I think the road ahead looking at the market in terms of just trading itself is going to be one where we have a lot of volatility and ultimately it might just be a roller coaster ride to nowhere.

A roller coaster ride to nowhere. And one of the things I want to highlight is that trading activity picking up is driven in part by some of the massive technology names that are out there driving the market or have driven the market. So let's start off with one of them that is front and center here. NVIDIA is kicking off its annual GTC event this week. But will it be a catalyst to put shares back on an uptrend? Our

Our Christina Partzenopoulos is following the money for us. And this is a stock over the last 10 days, Christina, that by my count here has shown an average trading volume in the last 10 days of over 337 million shares per day. This could be a potentially big catalyst.

Yeah, seasonality suggests that Nvidia shares typically rise in the weeks leading into the event, so to your point about volume, while the relative performance post-GTC, and that's the concerning part, consistently lags. And this year, much of the products, from Blackwell Ultra to co-packaged optics, are largely expected. It seems to be in every single preview out there.

But you have tech stocks, notably semiconductors, really not trading on fundamentals today. Cantor Fitzgerald says they're not sure Jensen can really say anything that would completely shift the market course and overcome investor fears about the macro and geopolitical uncertainty, specifically tariffs. Mizuho bets the stock is going to stay range bound, which we've seen for NVIDIA just up until maybe May earnings. That's what their bet is.

historical data though from wells fargo reveals a striking pattern in video has outperformed the socks index which is the chip index by six and a half percent on average during the week of g_t_c_ over the past five years that be this week so possibly more games in in late but in

The gains, though, as you can see, do not last. Looking out one month from now, the average return post-GTC for NVIDIA sits at negative 1.6%. Another concerning sign is NVIDIA shares are close to a technical death cross when a short-term moving average like the 50-day crosses below the longer-term moving average like the 200-day, so that would be the blue and yellow lines crossing on your screen. The stock, though, enters GTC week with one notable advantage. Of course, lots with post-GTC.

products and all that. But shares currently trading at a valuation discount. You can see a 4P down about 27 times, which is rare for NVIDIA at the start of a product cycle and could be an attractive entry point given the company's continued revenue growth trajectory. It just depends on what narrative you're going to believe. Dom?

All right, Christina Partzenopoulos with the preview of what's going to happen with NVIDIA this week. Thank you. And by the way, NVIDIA CEO Jensen Huang will be sitting down exclusively with our own Jim Cramer this Wednesday at 10.15 a.m. Eastern Time. Must watch interview there on the current state of artificial intelligence. Meanwhile, Joe, you're also looking at NVIDIA's performance after the event as well. What exactly are you keying on and what exactly do you think we

we could see in terms of the upside or downside and some of the volume that goes along with it.

I think the important thing for NVIDIA is can it escape the macro? Can it overcome the macro with what it's going to say? It's going to be a very clear message. They're going to talk about Blackwell Ultra. They're going to talk about the AI platform moving forward, just like they did with last year's conference talking about Blackwell. And the message clearly is going to be keep spending on our chips. But if we go back and if we could, if Sonny,

Englewood Cliffs, New Jersey could pull up a chart of Nvidia last year at the GTC conference. You'll see from the middle of March at the initiation of the conference until the middle of April, the stock rallies after the GTC conference about 8%. And then guess what? The macro gets in its way.

And I fear that's exactly where we are right now with NVIDIA. They've already alleviated the concerns surrounding DeepSeek with raising their guidance. They're going to introduce further AI strategies that are going to get people excited and have people keep spending. But is the macro environment ultimately going to be the problem? I'm concerned it is.

All right. If you're concerned, it is. Jim, let's bring you back in here. I mentioned before some of the caution that's now permeating through Wall Street on the strategy side of things. It's not everybody, by the way, that's saying that. So let's try to give you a little bit of the counterpoint here in BMO's Brian Belsky, noted bull here, friend of the show. He's sticking with the 6700 target price for the S&P, saying that fundamentals remain more green than yellow. They're disputing the

our view, many of the growth scare headlines are there. The economy is showing no substantive signs of recessing. To state the obvious, recent stock market weakness is all about uncertainty, period. As such, there's time to hunker down on your respective disciplines, avoid reacting, and rely on facts over feelings. Also, UBS says there's still more upside left to go in stocks as well. In our base case, we expect U.S. equities to end the year meaningfully higher than today's levels with a December

S&P of 6,600. U.S. policy uncertainty could lead to short-term volatility, but we believe that continued structural AI tailwinds and solid earnings growth should drive markets higher once policy uncertainty peaks. That is also what's been happening for the better part of the last six to nine months outside of the last two to three weeks. So, Jim, which side do you err on?

I'm with Brian. He's a friend of the show and a friend of mine. And not just because we agree, but we do happen to agree. Simply put, the positives outweigh the negatives. Now, everybody listening, I want to be clear, there are substantial negatives out there. A trade war, tariffs are not generally positive for the economy or the stock market, but

But there are the substantial positives that both Brian Belsky and UBS are pointing out. And I would list those as we still have an economy that's still growing. I know there's this Atlanta Fed GDP thing, but we've got to adjust that for the gold arbitrage that's going on between London and New York. We still have an expanding consumption in GDP. We've got low unemployment and we've got a Fed that still wants to cut interest rates. Lastly, and I don't think anybody's really talking about this.

We've got a very stable banking system right now. Now I hope, like heck, that I'm not jinxing it by bringing that up, but we do have a stable banking system right now, one that is willing to lend.

You put all that together and I submit to you that to me and to us at Serity Partners, the positives outweigh the negatives. Our year-end price target on the S&P 500 is 6400, which is roughly a 10% plus return from here. I'm not a big fan of the price targets gain because people tend to adjust them as the winds of sentiment change. I think we're going to stick with that target for a while though. We just see the positives outweighing the negatives.

If I could just follow up one second with you, Jim, NVIDIA, because we framed it around NVIDIA as a catalyst this week. What are the thoughts there? This is a name that you are a part of.

Yeah, and very happily a part of. I think everybody has to understand there is no free lunch in investing. You don't get reward without risk. And the risk is volatility, which means that you get drawdowns like this. Another friend of the show, Adam Parker, has done some excellent research that says if you want to get 10 baggers like Nvidia, you have to be prepared for routine 50% drawdowns.

which has happened a lot in Nvidia's last five years. I'm not saying that that's where we are now. I actually think that it's probably, Christina pointed this out, very attractively priced at 26 times forward earnings for earnings per share growth at 52, 53% going forward. That's a peg ratio of 0.5, and boy, I love that.

So I feel very good about NVIDIA, but I'm going to close by going back to where I started. There is no free lunch. If you want the rewards that an NVIDIA brings, you have to be prepared for the risk and the volatility. All right, Bryn, I want to bring you into the discussion as well, because you have recently added to that position in NVIDIA on this kind of recent downtrend that we've seen short term. Take us through why and just why it is an important holding for you.

Yeah, I think Jim and I both added to it last week. So NVIDIA has been trading within a pretty tight band over the last nine months between about 109.110 to about 145. And so it got down there last week. And I feel that

The fundamentals and the price of Nvidia have completely separated, which happens. It happens on the upside. It happens on the downside. And so to Jim's point, they have very high margins. They're going top line in the 50%. It's a cheap stock. And I think that...

AI will continue and it's in the early stages. And if you talk to anybody in the data centers, anybody at the hyperscalers, none of them are saying we are going to build less data centers. None of them are saying we are going to reduce CapEx. All of them are continuing to spend and Nvidia we know is probably the highest margin recipient of all of those dollars. Now to Jim's point of the risk,

I think one of the risks and one of the clouds over the name are with the tariffs. This is a national security issue about the platform that they offer in China. And so there hasn't been a lot of saber rattling about that, which is good right now. I think that's one of the reasons the stock bounced with the market. But I think the market would sniff that out well before we would see that in print.

if there was going to be more extreme export controls on their products. So we'll have to wait and see. To me, that's the biggest risk. But once again, I first bought the stock in 2018 because there was some Ethereum slowdown, and that's why most people used their chips at the time. And to Jim's point, volatility is the price of admission. But this, to me, is one of the most durable, cheapest,

of the tech names out there and it's right in front of investors to take advantage of. - All right Bryn, if volatility is the price for admission here, let's talk about where there has been way more volatility in the Mag7 stocks outside of Nvidia, and that is in Tesla, a name that you own right now. One of the interesting calls right now coming out of Mizuho was that Tesla's target price is getting cut to 430 bucks from 515, but it's still reiterated outperform at this point.

We estimate Tesla's February 25 sales in key regions, the U.S., EU, China, significantly underperformed the market. We believe Tesla's sales woes are the result of deterioration in geopolitics, share losses due to a stronger competition factor in China, and softer than expected demand for the Model Y refresh. Does any of the price action as of late over the last six months make you worried about that Tesla position? And are you perhaps adding on weakness?

So the way I've managed the position, I continue to use options and sell calls against the position. I first bought the name back when the Twitter, he was taking over Twitter in the hundreds and everyone hated him then and those same people don't like him now. I think it's really important. The Model Y Juniper Refresh is literally just rolling out. And so why would you buy a Y, which was the number one selling car in 2024 worldwide? Why would you buy the Y?

when you can get the new juniper version, which is a nicer version that's just rolling out. So I think we need to wait two quarters. I do think, though, investors need to understand the stock technically is broken. We have to base down here. So what I did on my position, I sold when the stock hit 250 last week, I sold the April 17 calls at 270, got $13.00.

And that tells you, I don't think the stock's going to make a move over 270. I don't want it to get called away. But I got $13 for a little less than a month holding period. What investors need to see here are catalysts. Catalysts. They need to sell cars, by the way. They do sell cars. They are a car company. They need to sell cars. But also in terms of they need to have, will the robo-taxi roll out?

in August or may come in Austin, are they going to do an optimist demo? And so we really want to see Elon talking about Tesla, doing things at Tesla and getting all of the investor base excited about things outside of just how many cars did they sell or did not sell in the EU and Japan and EU and China. Okay.

Amidst all of that, there are places that folks are shifting around with out of the Mag7. One of the places they are finding some kind of refuge, if you will, in this recent sell-off has been in certain defensive places in the market, less economically sensitive. I want to bring up Trivariates' Adam Parker, who is talking a little bit about one of those forgotten sectors or underperforming ones in the last couple of years, and that's been health care.

saying that for now we would recommend focusing on lower beta stocks using revenue acceleration and relative earnings estimates achievability

as key signals for portfolio construction. This leads us to recommend health care and disfavor consumer discretionary, which is where Tesla falls into. By the way, given all the volatility, guys, health care is now the best performing sector on a year-to-date basis in the S&P 500. Joe, I'm going to go to you for this one here. Is health care an attractive place right now? And can you expect some kind of a mean reversion trade after a good period of underperformance in the sector?

well don the mean reversion is already unfolding in 2025 and it was an underperforming sector in 2024 i think you're seeing a little bit of a rebuild in position currently personally i bought amgen several weeks ago the quality momentum strategy and the joti etf is invested in a lot of the medical

device names which are performing relatively well. So there's some opportunity here for sure. It's good to see that capital is moving

away from technology and consumer services names and not directly into cash. It's trying to find other diversification opportunities within the market. Healthcare is certainly one of them. And I don't think that type of flow activity discontinues as long as we've got this continued uncertainty in the macro environment.

And Jim, what about you? This is something where you're in a lot of these healthcare related names, pharma related names. Is this a place that you do find attractive right now, given all of those catalysts that we see around the market? Yes, very much so. And to be clear, Joe's absolutely right. The mean reversion has been happening.

This trade is far more than mean reversion. By the way, when we say that, what we're talking about is we had a disastrous 2024, frankly longer than that for healthcare stocks. And so maybe are they just due? That's what we're talking about when we say mean reversions. But there's fundamental reasons. They underperformed last year because healthcare stocks always underperform in an election year.

the vitriol and and the politics that go on make it very hard for them to uh... rally and then when the elections over we see that the worst fears are really never uh... brought to bear so what you're seeing now is particularly on the pharmaceutical side very attractive multiples good dividend yields and obviously aging democrats

graphics across the world which support further top line growth. I think the most interesting name for me though besides the three biopharmas and pharmas that I own is UnitedHealthcare. It's one of the biggest weights, it might be the biggest weight I was looking as we were talking but I couldn't look it up.

in the XLV. It's a very big weight regardless. So sentiment usually begets price action, usually begets flows. Flows will start going to the ETFs. And as they do, UnitedHealthcare will be a beneficiary of those money flows. All right. And Bryn, we're going to close off the healthcare conversation with you. Is it attractive for you? Are you getting more involved in certain names or are you kind of staying a little bit more neutral on the sector so far?

Well, one of our biggest holdings is the Pacer Cow's free cash flow yield strategy. And I think healthcare is definitely in the bull's eye of free cash flow yield.

Two of the top 10 positions are Gilead and Bristol Myers, with very high free cash flow yield. And so I think those are durable companies. I think it's a very heterogeneous asset class. UnitedHealthcare as an insurer has nothing to do with Amgen or Gilead. And so it's a diverse asset class that I think we all lump together. So I definitely prefer the names that have that high free cash flow yield, which are more durable through an economic cycle.

All right. There's the health care conversation. Thanks very much for that. And of course, NVIDIA and the rest of it. Coming up next, though, are calls of the day, including a big upgrade for the one stock that Moffitt Nathanson says is winning the streaming wars. In fact, not just winning. They won, apparently. Halftime is back in two minutes with that name.

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All right, welcome back to the Halftime Report. Let's hit some of the calls of the day. Moffitt Nathanson is upgrading Netflix to a buy rating and says Netflix, quote, has won the streaming wars, case closed, end quote. Joe, you own it. Do you agree? Yeah.

Yeah, that's kind of years ago they won the streaming war, Don, didn't they? I think at this point we're talking about a company really that is looking towards the future. And investors are excited about that future because I think the future for Netflix really is,

circulates around live sports programming, right? And it's about the ability to use live sports programming and have ad revenue increase and have subscription revenue increase concurrent with that. The excitement on live sports clearly goes back to, you know, Tyson Paul fight, the NFL games. And I think when you look into the future,

getting into other areas like mixed martial arts or maybe even adding more NFL games. I think that's where the excitement rests for Netflix. And I think that's the reason investors have kind of been well anchored in this stock and there's been a degree of resiliency. Technically, it's still sitting above its 50-day moving average for those that look at that stuff. Okay, this is a name that's also had a pretty nice run, Bryn.

Is it enough for you to want to get in now, even after the run that it's had? Or is this something where you say, hey, maybe we just wait for a bit for things to cool off a bit, consolidate, and then we'll reassess?

I mean, Netflix has been a compounder of returns for what, the last 10 years? So I didn't miss the last three weeks, miss the last 10 years, right? I mean, this is just one of those wonderful companies like a Costco, a Netflix, Visa, that if you got in there early, it's just a compounder and they're just eating everyone's lunch. Their content is incredible.

I totally agree with what Joe said. So kudos to all of the long-term investors that have enjoyed really just the compounding that this company has given investors over time.

All right. And then let's bring up another name outside of that in oil and gas. Let's turn to Exxon. Analysts at Barclays over there are basically trimming some of their price targets across the entire space. One of them is Exxon Mobil. The price target goes down to 135 from 137. Jim, this is one that you own. Do you agree with the call or no?

Well, it's interesting. I mean, 135 is almost 20% higher than here. So I do like that. Plus, there's a good dividend yield here. I want to be very clear. I'm a very strong advocate for ExxonMobil. I think that everybody should have some energy exposure in their portfolios. And the first stock that they should own when they're building out an energy component is ExxonMobil.

in the world when it comes to energy, certainly in the U.S. And there are economies of scale that come from being the biggest. You know, Dom, you weren't here, but it was about two months ago. And I remember having a conversation on the show about, hey, could it perform if oil prices go down? And it has gone down over the last two months, the oil prices, that is. But the stock has performed.

And that just speaks not only to the size advantage, but the fact that it's priced very attractively right now. So if you don't own it, I would add it here.

All right. Oil and gas wise, we always have to bring Bryn into this into the discussion here. So Bryn, this is a call on one of the names that you actually own with Diamondback Energy. You've been talking about it for quite some time now. The price target over Barclays trimmed to 200 from 210. They see the possibility for greater deflation capture later this year as management believes rig rates will continue to trend lower. Diamondback is a name that you like. What does this call say to you?

I mean, they cut the target by $10, so still well above where it is today. Listen, this is a cyclical business, but I think in this space you want to go where you have strong C-suite, strong executive teams. And I think over the long term, the team at Diamondback has just shown they're one of the top EMP players in the United States. And so in a cyclical business,

This is one to own. I also think they did a huge acquisition last year. And so now I think the free cash flow will start to build back up with not only a diamond back, but in the whole sector. So still like the name and agree with the call. All right. Those are your calls of the day there as well. Let's now get to the headlines. Well, Silvana Henao with the news update. Silvana, good afternoon. Hey, Tom. Good afternoon to you. President Trump says he will speak with Russian President Vladimir Putin on Tuesday about ending the three-year Ukraine war.

Territorial concessions by Kyiv and control of a crucial nuclear power plant are expected to be sticking points in the talks. And Russia's deputy foreign minister told state media today that Russia wants ironclad security guarantees to ensure Ukraine isn't allowed to join NATO.

Book tour events scheduled this week with Senate Majority Leader Chuck Schumer for his new book have been postponed due to security reasons. Now, that's according to his publisher. The rescheduling for the debut of anti-Semitism in America, a warning, comes as protesters were expected to attend the event after Schumer outraged some Democrats by backing the Republican stopgap measure for a government funding bill.

And comedian Conan O'Brien will be back on the Oscar stage as host next year. The reprisal comes after ABC reported the Academy Awards set its fifth straight ratings record earlier this month. Next year's show is set for March 15th. I'll send it back to you. All right. Thank you very much, Savannah. And now with those headlines coming up next on the show, Mike Santoli joins us with his midday word. We're back after this break.

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All right, well, we are looking ahead to a very special CNBC Pro live event right here at the New York Stock Exchange slated for June 12th.

For the first time ever, we're going to give you access to meet the CNBC pros that you see on CNB Pro Talks in person. Also participate in a series of interactive pro clinics to sharpen your investing strategies. Just scan the QR code on your screen over there. Visit CNBCEvents.com slash pro live for tickets and more information. I'm going to look forward to seeing you there.

Well, let's turn now to Santoli's midday word. Mike joins me now on an otherwise desolate set because everyone's remote today. But Mike, this is nice, a little one-on-one time with you. Do you feel good about how you're doing?

about how things are shaping up right now? Or is the caution still the tail? I think caution, apprehension. I think the market is kind of open-minded as to whether Friday's bounce was meaningful. I think there was a lot of things to speak in favor of the fact that there was very strong breath. You know, it did try to be a little bit cute and say, oh, we got one close under the 10% correction level, and let's see if that sticks.

A few other things, which is the faster the 10% correction historically, somewhat better forward performance after that, because it suggests that the market is undergoing a quick shock from a record high, not kind of sniffing out recession. You put those things in the mix with some positive seasonals, I think people are willing to believe that we have a little more of a tradable upside from here, but...

It's all contingent on maybe getting some kind of clarity around April 2nd tariffs. The idea that the momentum kind of reversal trade has finally run its course today. I think you have questions about that because Nvidia and Tesla and some others are the pressure on the downside. And it's something that, you know, we talked about earlier as the show started, this idea that commodity trading advisors, these momentum. Yeah.

momentum tracking type hedge fund instruments are now starting to kind of shift a little bit with regard to how they position. And so that's something. And Joe, I know that you brought that up and you're here with a question for Mike as well. Yeah, I do. Hey, Mike. So, you know, you're hearing a little bit of chatter, the speculations coming surrounding a significant end of month rebalance bonds into equities. Are you able to kind of give us a little insight on that or quantify it?

There is definitely mathematically you totally have the setup for that.

I know there's a lot of fixation, too, on those sort of known enormous funds that have hedged positions and whether there's certain levels that are going to dictate how they rebalance. So I think that's one of those potential mechanical tailwinds we have ahead of us. I know some people are trying to kind of handicap how this week's options expiration might go and suggest it has a little bit of an upside tilt, as well as the mid-March moment being when seasonals turn better. I think that's all.

all maybe moderately encouraging, but I find it interesting that everyone is so fixated on, OK, who needs to buy as opposed to do we have the fundamental setup for people really wanting to buy or getting a lot more conviction that they really want to have higher equity exposure? I think that's an open question. All right. There you go. Mike Santoli. We'll see you later on this afternoon for a hopefully calmer market right now. Anyway, coming up next in the show, more committee stocks making moves here. Halftime will be back after this break.

welcome back to the halftime report let's hit some committee stocks on the move roblox announcing its new ai model bryn a name that you own in roblox yeah this is a pretty cool feature i think that this is not the first this is a new feature it's called cube 3d it's going to allow the developers the creators that create these worlds to develop 3d images just by text and i think that you will continue to see in the gaming area where

AI and integrating AIS features is going to continue. I mean, don't forget that NVIDIA started out as a gaming chip company. And so, nice to see that Dave Bazzucchi and team continue to add these features that allow the creators to create better content to have a stickier platform.

Bryn, we're going to stick with you for just another couple seconds here. We're also talking Robinhood, which is getting further into the prediction markets kind of aspect of that business. This is also a name that you tend to favor.

Yeah, own the name. They're going to do some fun stuff around March Madness. This, to me, is going to be a very sticky company. They continue to bring in a ton of assets. Right now, they have a deal. If you transfer over your brokerage account, they give you 2% cash deposited to your account. So I just think they're going to continue to chip away at the legacy custodians because their user interface is really compelling. And I think this is a company to watch.

All right, let's move now into the bigger conglomerate side of things. Berkshire Hathaway close to at or near a new record high. It keeps raising its stake in some of these so-called Japanese trading houses, getting more exposure there. Jim, Berkshire Hathaway is the name that you own. Do you still like it?

Very much so, and it's been just a stalwart performer. I mean, first off, it has the operating businesses, Union Pacific, Precision Cast Parts, the energy business, it goes on and on. So it's a good snapshot of the overall U.S. economy. Then, of course, there are the financials, and you pointed out the Japanese trading houses that it's increased. It's had a very good bet there, and it's increasing them. I think what's also maybe interesting here is we know that the cash hoard there is extraordinarily high. I think it's $340 billion.

And one wonders, there's no evidence, but one wonders if perhaps Mr. Buffett has put some of that to work in the market downturn that we've seen here. He certainly has the wherewithal to do so. All right. There's the trades on all of those. Thank you guys very much. Straight ahead on the show, we're going to take you inside the alternatives universe, how asset managers are pushing to put private assets in your 401k plans. Halftime is back after this.

All right, we're back. Big changes could be coming to your 401k as asset managers and plan providers work to put private assets in your retirement accounts. Our Sharon Epperson is here and taking us inside the alternatives universe and how it plays into our retirement. Exactly.

It's interesting to look at because diversification is one of the key reasons that proponents want to add private equity to investment options and retirement plans. Private market investments currently account for less than 1% of assets in 401k and other defined benefit contribution plans. 87% of the companies in America with revenues over $100 million are private.

So how do we give 128 million Americans in the defined contribution system exposure to those asset classes?

Murphy is the CEO of the second largest retirement services company in the United States. He says private market assets should be added to 401k plans through target date funds, managed accounts or collective investment trusts rather than a standalone investments. Before that happens, though, several challenges must be addressed, including high fees, lack of transparency and liquidity risk. BlackRock CEO Larry Fink says his company is working to address those concerns.

So our job is to be providing a much better transparency and analytics to get that done. If we achieve that, then I think we're going to have a credible opportunity to add these type of instruments to retirement products.

More than half of the $11.6 trillion in assets that BlackRock manages are for retirement. And, Dom, this is something that is being discussed by the SEC, also the acting chair, just talking about the need to have some discussion and some facilitation of

private market investments for retail investors to broadly diversify portfolios. So that's something that the SEC is definitely going to be looking into. I'm all about more choice for investors, but it doesn't come without risks. So I'm waiting to see how the conversation gets framed in Washington, D.C. and elsewhere along those lines. Absolutely. Sharon, thank you very much for that. OK, let's bring in the traders to the conversation here. And we'll start with you, Bryn.

Is it a good idea for hedge fund private equity type investments in 401k plans, given their risk levels and given their liquidity risks? I think what's risky is when someone retires at 65, they're in a target date fund that's 80% bonds, 20% equity.

equities and they're going to live another 25 to 30 years, they're going to grow more safely. So to me, that's the risk that investors have is they have an incredibly limited amount of choices. And as they get to retirement, those target date funds are just not calibrated correctly. And so I think having other things in 401k assets are incredibly important. Now, execution is key, but I think that

To me, when you have a long-term time horizon, and especially as you get older, you don't want 100% of your assets predicated on interest rates moving lower and stocks moving higher to generate all of your returns. So I think it's a great conversation to add other things outside of just stocks and bonds

and antiquated target date funds inside of a 401k plan. No doubt. It's a great case study in the making as well, Bryn. Thank you very much for that. Now, also be sure to sign up for Sharon's Money 101 newsletter to help improve your financial wellness. Just head over to cnbc.com slash money 101. It's one of my favorite newsletters out there. I get tips and tricks there all the time. So, Sharon, thank you for that. Anyway, stay with us. Final trades are coming up on the Halftime Report. Keep it right here.

All right, don't miss a special halftime report live from Future Proof Citywide in Miami Beach, Florida tomorrow. I'll be there live with all of you listeners and viewers, along with the investment committee, including Joe Terranova. Joe, it's rainy and cold up here. What's the scene like down in Miami Beach, Florida?

Sunny and 80 for the next three days. Much needed wealth management conversations, client solutions, generating alpha. Congratulations, Josh Brown, for putting this all together. Phenomenal conference. Looking forward to seeing you tomorrow, Dom. All right. I'll be on a flight in just about a couple hours time here to see you guys. Now to final trades. And Joe, we'll just start with you. Well, let's talk about private equity. Apollo is one of the names we own in the ETF. I think it's one of the names that you could own here. Harvey Schwartz speaks here tomorrow. He'll let us know the state of private equity.

All right, Bryn. Great minds think alike, KKR. More than enough news has been priced into these names. They're overdone, like it here. And Jim. United Health Group, got to respect this relative outperformance. All right, that does it for the half. The exchange with Kelly Evans starts right now. You've been listening to CNBC's Halftime Report, the podcast. You can always catch us live weekdays at 12 Eastern, only on CNBC.

Thank you.

but only as an expression of an opinion. Such opinions are based upon information the Halftime Report participants consider reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Halftime Report disclaimer, please visit cnbc.com forward slash halftimereportdisclaimer.

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