tv Fast Money CNBC November 24, 2020 5:00pm-6:00pm EST
can look through the numbers tomorrow we have a lot of economic numbers three days worth because of the holiday. keep an open eye on what the market does in response to some of those numbers >> some of that data this morning wasn't that strong the dow closing the 30046, up 1% thanks for watching. "fast money" starts now. i'm melissa lee. this is "fast money. tonight we are charting the rallies. dow hitting a major milestone. and breaking down the next level to watch plus the big fight over ford we will find out who is in the driver he is seat. -- driver's seat and the bitcoin buzz as it crashes through 19,000 mark.
but we will be told to proceed with caution and dow closing for the first time in history over 30,000 the question tonight, are we headed -- ♪ >> yes, that's right, are we heading higher and higher? there are positives. the presidential transition is under way. we have three coronavirus vaccines ready to rock so, is the next 10% move higher and higher or are we headed lower and lower? >> well that song, that's a miserable song >> that's why we chose it. >> please don't at me on twitter. in the list of bullish things we talk about, the peaceful
transfer of power as being a bullish thing. you would think that would be a given. i find the market took that as a positive today fascinating. i will be the first to say in terms of the broader market, i have been dead wrong we have had individuals stocks we have done a good job with broader market not so much we are so over it in terms of valuation, euphoria, the things that can go right, not just the head winds out there despite it has bnsecause i been market >>we have this wall of worry isn't that markets do? >> right the question is, if you think the market is going lower, then what else -- what is going to hit us >> you never get hit by the bus you can see.
what can't you see the market pricing needs more stimulus, low interest rates and relatively stable politics to a grid ro gridlock state that creates inflation, but it has been said that the good parts of inflation come first. it makes sense to me that equity prices are going higher, but what could go wrong? we are seeing oil prices up higher that could put a stall on the economy. those are all of the things we might not be able to see but absence that, the market to me appears to be pricing in the economic situation we have in the next six months. >> does that mean we are going higher, brian? do we go higher because the good things are still to come, the actuality of the good things versus right now, looking
towards the good things so to speak. >> you are saying i could have just said higher or lower and been done? >> basically it was good to go through the risk factors i am going to ask that question to tim you have set it up nicely. higher and higher or lower and lower. >> i think higher. >> tim, you through your hands up why? ♪ >> this is like trade it or shoot it or punt it? what's the question again. i am not the smartest guy. >> we hit this milestone is the next 10% in the market be higher or lower? >> if you are telling me a straight 10% move higher or lower in one direction, i don't think we will get either i don't think you are saying that will we be 10% higher faster or 10% down from here which will come first, maybe that's the
question sorry to rephrase it, but that makes more sense to me i think it will be 10% higher. remember the run we had since july 30th. we went straight up 10%, down 10%, zigzagged we are now up 12.5% off the bottom, but we have had five runs, up down, up down, up, up 10% or more. based on history you may say we are going lower, but i think there has been anxiety around elections, about policy. i do think fiscal, as we talked about on this show has been an important ingredient for the market to go higher. the best thing going on is that banks continue to pick up a bid. you mention that about oil the fact that oil is moving higher is not inflationary from a credit perspective, it's very good. there is a lot of devastation
and there will still be some seeing the market go higher is healthy for the economy and credit but the banks and credit losses, some of those have been rolled off, but there are more to come. why are the banks such an outlier to markets they were taking a big hit on unknowns and three vaccines in three weeks does more to put longer clarity on banks for ex-strap lags >> it's the bangs, the industrials, the materials >> it's a good setup if you like the identify why of the s&p 500 hovering here above the prior highs.
we haven't even talked about the russell. it is up from the northeavember in a straight line if we can talk about a straight line i don't think that portends well i think if you are a massive bull for all of of the reasons about fiscal and monetary getting us to the other side of vaccines, you don't want to see us rally 10% in the year end that pulls forward a ton of performance. what are you guys expecting for growth gdp growth in the past ten years has averaged about 2.5%. in 2018 we had those massive tax cuts, borrowed from the future, gave it to the corporate and
they bought the stock back over the next year or year and a half and the next year gdp was 3.5% it has taken trillions and trillions of monetary fiscal stimulus i don't think that's a great setup for returns. it creates an asset bubble that doesn't mean we are going to crash today, tomorrow or next week that means there is a bubble inflating here, has been inflating and that sets up for dire things going forward if we don't see the sort of progress on the pandemic and don't see the growth in our economy. >> dan is serious. the time of the pandemic has been a time for companies to
improve their operational efficiency, and balance sheets and for consumers to improve their balance sheets take a look at this. what happened to it. this is the point you have made time and again people aren't spending as much on experiences on lunch for $10 in the city. they don't go to the office anymore. they pull out a burrito from the freezer and heat it up in the microwave. people have more money to spend on things, goods and potentially on stocks as well at a time they feel rich because of the stock market and housing market. aren't these good things as well for the market to go higher? >> no question about it. everything you said is bullish the counter maybe is carl
quintanilla -- we call him q -- it's still the other side. i am hearing rapping in my ears so that means we have breaking news >> you don't but anyway, higher or lower. let's go to rob for our off the charts climber higher or lower? >> i think the next 10% is higher you have to respect the action of the market from what we have seen from the march lows, but particularly what we saw from june to october where so many cyclical stocks trading sideways are breaking out even if you look at the dow over the last couple months, and tim alluded to this. we have these gyrations breaking
back and forth and the market is out of that range. if we look at 26,000 to 29,000 on the dow, the market is sitting above that trading range. it's bullish it can consolidate. i think the next 3,000 points are to the upside. sure, in the very, very short-term in the next week a lot of micro caps and short caps have been blistering i don't think it's 10% and i doubt 5% i think 2 or 3% and then we move higher through the first quarter. the underlying market is bullish. the vix has nowhere collapsed. it still looks like 2012, 2013 after the election i think we have a long way to run in this market before we see a cycle peak we are still very bullish. >> what are the two stocks you
see as the most opportunity? rob? >> tim was talking about financials running, energy running. i still like dupont. i think it's a cyclical that will benefit on the upside as we move through this economic malaise. i think that is timely it has been breaking out and still timely relative strength is still good. and the other big name is american express call it 115, 117 trading range i think it still looks timely. and i think there is more upside in the first quarter >> and the one stock -- >> one i would avoid, procter
and gamble they have been in the trading range for two months but if you look at the bottom panel of this chart, you have a high end march, lower high it's the type of stock that i think lags the market. i would stay on the sidelines. i don't think you will lose a lot of money but i don't think that's where you will get the juice on the upside. >> thanks, rob have a good thanksgiving brian, where do you go with rob's picks? >> i like american express i like the chart i have a defined range you are trading this as a breakout if you think about what is going on in the world, american express tends to have a higher end customer stock market going higher. people who buy stocks tend to have american express cards. less chance of delinquency on
that if you get some spending increase and stock market where cyclicals are going higher and tradeable range, i think american express will look good. >> i like american express a couple weeks ago we had the pfizer vaccine and american express gapped up i think 15%. it was up much more than its banking peers. i thought you would see a pullback at 110. that's where you reload on these things i want to make that point. the market, given the volatility, you will have an opportunity to get back in at breakout levels especially where if you are playing for the end of this year or beginning of
next year. these stocks are not going to go straight >> procter and gamble had gone up which side of the ledger are you on >> i am on the dupont side of things if you want to go full circle, last year dupont was at -- i am with rob on that one procter and gamble, it's absurd that a company in this environment would be trading at the level it is. i would be getting out of p & g here i think there is upside in dupont >> the question for procter and gamble, in any other environment can procter and gamble have this
valuation? >> probably not, but before i hear that, when i hear dupont i think of andre "moose" dupont. i think procter and gamble, through food stocks put it on. i think it really has a good news priced into it. i don't like the stock at all and i would rather be in resources and banks. you don't buy commodities when they are cheap you boy them when they are expensive. i think this is fourth inning and not eighth inning, a ways to go >> proceed with caution with
bitcoin. but first, check out shares of gas down0% 1 after reporting results. we will break down what happened when fast money returns. ins. change in plans. at fidelity, a change in plans is always part of the plan. this was the theater i came to quite often. the support we've had over the last few months has been amazing. it's not just a work environment. everyone here is family. if you are ready to open your heart and your home, check us out. we thought for sure that we were done. and this town said: not today. ♪
welcome back we have a double after hours earning alert. gap and nordstrom. >> gap with 4 billion in revenue, comp sales up 5% driven by a 61% interest in digital the higher figures in athletics. banana republic swooned 30%. the ceo is optimistic saying people will spend more on clothing because they won't be spending it on travel. as for nordstrom sales were just shy of 3.1 billion
more than half of that driven by online the company reported an adjusted quarter. driven by a 32% in off price people seem to be spending on full price on the call pete nordstrom striking a more optimistic tone. saying we have made quick adjustments for our holiday customers, encouraged by the holiday momentum and look for momentum in the fourth quarter and 2021 i guess accentuate the positive. >> a new chief officer and new
ceo of banana republic looking to bolster the performance it has been a drag i don't know the last time you bought banana khakis but apparently nobody is buying them >> not just because of the home environment. i got sick of khakis about a decade ago the move on gap, i think it is fair to say the valuation was tough. closing stores continues some of the comp sales for the fourth quarter was that they would be closer. not a big surprise i would argue that banana republic is not even in the price. you are getting it for free. i wouldn't be concerned because i don't think the expectations were high for banana >> i think khakis are back dan, i know you are an avid
watcher, and i think steve made them popular again wearing khakis every day and got them from the gap. >> i love kernake. i could not have gotten through this without him >> this stock was already challenged before the pandemic hit our shores stockle stock was trading in the high teens before the lockdown. i give tim a shout out because he has been right on the department stores. we talk about online sales and there has been acceleration. some companies had been already doing this beings making investments and other companies were doing it to stay alive. i put gap in that category some of the issues they are having with fashion and work
from home, i don't think they will change much i don't think the costs associated -- i think investors will appreciate up 400%. >> they were up prior to the pandemic, changing what the people wanted. they had a bigger problem to solve, guy >> no doubt about it we will talk about nordstrom's in a second, but look at these two quarters nordstrom's figured it out and gap is a disaster. if banana republic comps are down 30% which is twice as bad as the street was looking for, it is not a great quarter, juxtaposed with nordstrom. i think 54% of their sales are from digital
good for nordstrom's, bad for gap. maybe gap should have named kernacke as the officer. i am only half kidding around. that would have been genius. he is looking for a new gig i am sure at this point >> playing by your own rules >> that's not playing the game, mel. >> i completely switched to yoegz points >> the bitcoin boom is taking the market by storm. but it may be time to pump the brakes why? and later. is it time to steel up your
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hedge funnel hedge fund trader hat, signs at the top. more than any other asset class. bitcoin is subject to fomo more than anything else coins that are under $5 going up 30 or 40 in a day. when i look at address growth, markets, when you get big address gross employed, that's a caution sign and the last one, we are starting to see retail and starting to see the interest rates it charges on margin going higher i think it's fine to buy bitcoin. earlier i thought they could go to 50,000. i still think that's the case. but if you buy it at 19,000, be
prepared it drops to 12 before it goes to 50. just saying to exercise caution. >> do you change how you trade what do you do >> yeah, so i would say, less long bitcoin this week than we were two or three weeks ago. if you are an investor at home and say i want to get bitcoin, i think it's going to 50 k so maybe buy half of it and wait for one of those times when we say bitcoin had its worst day in two years. and adding to parallels of this bitcoin boom what are you toting, tim >> this was about as big of an
update as cannabis has ever seen like b.k. i urge people to do their homework we just came out of a period where the biggest five companies in the united states who have the biggest addressable market in the world produce sequential growth it was extraordinary and continues to grow. so here legislation is only part of the story of great operators in a growing sophisticated market i think these companies and many more behind them will be some of the greats but we have looked at canadian companies. are they big trades or investments. a lot of the money has been eradicated, and some of that north of the border. that doesn't mean they are all bad companies. there are great companies up there. i am seeing new family offices
and seeing institutional investment behind us i am very long-term bullish and if anything, what we are seeing through difficult operating conditions, cannabis is rising to the occasion at a time when the story is not the difference between bitcoin and cannabis is very clear it's bizarre to have to explain that a time people looked at them as fomo asset classes and still may be but cannabis is unfolding and is incredible but look at the as set structure and look at their making money and be careful of a lot of the hype >> still to come going head-to-head on ford
we are taking your questions. that's right we want to hear from you so shoot us your questions and you may get your answer on air pnc is still in the red for the year, following suit with the other financials our next guest says the regional bank could be gearing up for a rebound. kate, great to have you with us. what do you like about pnc >> i think it's fantastic for a number of reasons. it has announced deal to buy assets is a game changer it gets pnc into the sunbelt, into texas, and they will get
great cost energies out of the deal second, it is esg, environmental, social and governmental factors they are a great corporate citizen. they have pledged a billion dollars to hope communities and pledged money to covid relief. third thing is a deposit franchise. you think about a bank, a commodity. they get deposits, loans and that's it. not for pnc. half of their revenue comes from fees that means their depositors, they are using the money last thing 12% return on equity which is
great. trading at under 1.2 times price to book. the dividend yield is north of 3e%. -- 3%. they have doubled their dividend in the last three years and it should go. buy pnc. >> one of our traders has a question for you b.k. >> the new administration coming in, the indication is they are not bank friendly. one thought in the market is that banks are utilities and utilities trade up one times book and banks have had a tough time trading above one times book over the past several years. are you concerned about an unfriendly environment >> i am not. historically banks have been protected. too big to fail, you name it it.
they are important assets and important to the economy >> in the times when banks were protected, did their price to books fall they can be protected and viewed as too big to fails, but also can be viewed as utilities and therefore can command the price to book. >> a good point. since 2008 the bank environment has changed, the regulatory environment has changed. you have better title regulation this is good for the banks so i am not concerned about this in the least look what happened with covid. they needed the banks for ppe loans. i am very comfortable with the regulatory environment no more time here. time to vote are you buying or selling cate's pitch on pnc
>> mel, can you read my white board? >> i do know how to read it says i saw frank sinatra at garden art center. and most would know that is now the pnc. it is up about 1.7 times tangible book. well done on the power pitch >> that all boils down to a buy. tim, what do you say >> i'm banking on cate and buying pnc it overcomes the loss of the black rock asset sale. it should trade at a premium and i think they will.
>> dan >> i thought that was a great power pitch by cate. i am not a buyer here at 140 and this is consistent with what i was saying about buying at these breakouts. you don't have to buy it at 140. it will likely be back to 130 in the next few weeks by the way, the first concert i ever went to was beach boys at the art garden center. >> i am concerned this has gone too far too fast cate makes an excellent point but it has gone from 105 to 140 in basically less than a month so i think a lot of the new regulatory commission has not been priced in yet >> one last final word or
appeal >> i am going to stick with what i am saying. it has gone up a lot, 25% since they reported for the quarter so i am going to stick with pnc as a long-term buy. >> cate, thank you the traders have voted it's your turn vote at our twitter poll up next, shares of ford have accelerated. do they have any gas left? did you know you can go to libertymutual.com
before we get to equity trade. >> full interview coming up on "mad money" tonight. this is a guy who succeeded, trevor milton, guy, what do you want to hear >> can a company move without outside propulsion i think there is question where the business is, where the partnering with a gm takes them and when we can look at cash flow, not free cash flow, but at least top line some of the infrastructure questions about what makes this concept work in terms of national infrastructure on some of these hydrogen cell
technologies are key, but where is this company in the model right now. you phrased this question long ago. this is business model or company. >> guy, if it can't seal the deal with gm, is that a sign for investors? >> i would have thought it would have been a while ago. my bigger question is can you assuage your questions we saw earlier under the trevor milton regime >> ford shares are up more than 6% today in today's session. in the options market, the traders are betting it is far
from over. >> it says a lot because they trade over 300,000 typically and over 420,000 traded today. we saw more than 50 thousand trade for about 32 cents they are suggesting it will trade more than the 32 cents they paid in a rally over the next two months. >> dan >> the thing got overdone in the throes of this pandemic. they did not see the enthusiasm about evs. ford has trucks coming out, some of them ev i am not a fan of the stock. it is basically unchanged on the year after rallying from the lows
they went last year from like $1.10. they are going to lose this year they don't get back to earnings on a positive basis for another five years or so i like what they are doing i'm just not sure the stock is particularly investable here technically, draw a line from the 2014 high and go from top left to bottom right and you see a well-defined down trend. that is threatening that here. but after the run is had, i don't think you will see much more after it. i see why people want to buy calls. >> i think the question for ford as well as gm, should these stocks be re-rated given what they are doing with evs and their ev portfolio which is actually coming to market. >> dan brings up a great point
ford has struggled with profitability let alone other dynamics, to expect them to be this darling ev story. the chart is interesting this has been dead money for ten years. this is a story that like gm has gone nowhere and has actually been going nowhere i like ford. i think that people understand that ford more than gm had to prove they could be profitable this is a story of a company that never ran right the estimates raised out of the third quarter were on a higher base of their north american margins which means it is a more profitable company and has changed its stripes. it has been painful, painful economically and socially. but the most popular ev car or
truck, or both should be a star for ford >> ford or tesla >> tesla it has more hype ford, a lot of stuff is raised in already >> guy, you raised your hand so i will call on you >> there is a wild card with ford and that's that jim farley, georgetown class of 1945 is the new ceo. >> that's right. >> are you ready to bank on pnc? vote and we will have the wsults coming up. weill head to break right now and see you on the other side. more fast straight ahead ♪ ♪
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moments ago following some announcement of key parties. biden says peaceful transfer of power, the hallmark of american democracy, has begun >> the head of the gsa yesterday unlocked -- >> immediately we have gotten outreach from the national security shop, just across the board. they are already working out my ability to get presidential daily briefs, already working out meeting with the covid team in the white house and how to not only distribute, from getting a vaccine distributed to a person being able to get vaccinated so i think we will not be so far behind the curve as we thought we might be in the
past there is a lot of immediate discussion and i must say the outreach has been sincere it has not been begrudging so far and i don't expect it to be. so, yes, it has already begun. >> that comes hours after the general services administration as seascertainment of the vice president elect. we will have more analysis on shepard smith here on cnbc. the fast pchit, we will have the results and final trades, next em going to tell you about exciting plans available to anyone with medicare. many plans provide broad coverage and still may save you money on monthly premiums and prescription drugs.
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