Skip to main content

tv   Fast Money Halftime Report  CNBC  November 9, 2022 12:00pm-1:00pm EST

12:00 pm
maybe cz took a look at the books. we'll see how it works out with bitcoin, just above 17,000, carl >> busy night again between bumble and blade and rivian, and cpi coming up in the morning so the week's not over by a long shot let's get to the judge and the half >> reporter: welcome everybody to the half time report. i'm scott wapner, front and center this hour assessing the aftermath from the mid-term surprise to meta's layoff and disney's dow disaster. the company debating what all that means to your money liz young, jim labenthal all here with brian bellsky on set let's check stocks down as you see. we're down 0.75 on the s&p, down a little more than 1% on the
12:01 pm
nasdaq and the 411 the ten-year note yield and musk selling 4 million tesla shares we've talked about that stock, joe, at critical levels. you've got ark at a new 52-week low, bitcoin at the lowest level in two years and all of that we pay attention to the cpi which is looming tomorrow >> does the calender say 2023 yet because i can't wait for 2022 to be over. you had a gridlock rally yesterday and that gets by this negative market sentiment and bleeding into the market again today. >> you think that's what this is about? >> without question. this is quote-unquote liquidity concerns, though i think it's a risk to market financial stability, no. but i think people are looking at what's going on right now in crypto and questioning whether the liquidity is ultimately going to be there, who's this last player in this game of musical chairs and they're
12:02 pm
raising some cash levels and that's just where we are in 2022, unfortunately. and again i go back to the megacaps apples are down below 137 at this point, amazon down, alphabet down, amazon. >> watching tesla as i mentioned again with some calls mark newton made yesterday. liz, how do you see it is this about crypto, not as big of a mid-term win if you want to call it that as was expected or what >> well, first of all, the expectation is usually that after a mid-term election the market usually finds relief and finds some up side the rally we've seen up until this point hasn't really made a lot of sense, and what i mean by that is the optimism i think the market had whether it was
12:03 pm
because of some kind of pending fed pivot, which isn't coming and now we're in the face of not only a crypto disaster but announcements that continue to pile onto one another about layoffs from tech companies, that eventually is going to bleed into the labor market in the actual numbers so we're just starting to get these hints of earnings contractions and economic contractions that i think the market has to really right size itself before we can get to the other side so a little pull back here i think is rational. i don't know it's going to be the big one. i do still expect one big flush before we are done with this bear market. >> so we have like an electric fence around you for the bears the bulls are in an electric fence so they can't get close to you. you can say whatever you want, don't worry. >> as long as we're not in the penalty box. >> not yet you do have i guess some i don't
12:04 pm
know if concern is too strong of a word, i don't know if it's that strong with the crypto fallout, other asset classes and the roaches we're going to soon take a look at, you've got yield, ark, what do we think is going on here in the market? >> i think it's a whole lot, everything, the four horsemen of the apocalypse we talked about did a good job taking out the ark stocks, taking out the means, taking out the spacks and now it's still going one more time at crypto, and i do agree with joe i think it is a liquidity issue and you take a look at the most stocks and those are long duration agets, too, so they still have a lot of risk to them, as the market over the next few years and we've been using this term normalizes where interest rates normalize, earnings growth normalize, and oh, by the way, the balance sheet normalizes, these
12:05 pm
longer-term duration assets are still going to be under pressure so it doesn't mean we're not bullish but just means i think we have to be a bit more tempered in how we look at the next six months. >> are you looking at the mirror when you say that? >> i like it better when you say i. >> so i think this no, jim, and i think this. there's so much bearishness out there. i think there's this pent-up demand for any good news >> for sure. >> i think the market is a little skittish heading into tomorrow as well fool me once shame on you, once, twice, three times if this thing comes in hot tomorrow, look out >> let me tell you something there is -- there's a note from a trading desk making the rounds that suggests a, you know,
12:06 pm
hotter than expected report tomorrow, could mean a really big decline tomorrow in stocks >> well, everybody's been looking -- >> not your garden variety of 1 or 2% decline either >> right so everybody's been looking for this blessed capitulation. maybe that's your capitulation let's wash the deck. >> i don't know do you think that'll be good news because that'll then bring a much larger than expected rate hike in december into play >> i think the fed is going to come out and say let's go to 5%, let's get this thung done and move on here and start the process of normalizing, and i think that's what they're trying to do but they need to be a bit more forceful in terms of this choice >> joe made the point on megacaps and as someone suggests to me reiterating the notion that tech and crypto are in their words tied at the hip,
12:07 pm
right? you can't get any traction in -- i mean the nasdaq and bitcoin were pretty tightly correlated for a good period of time. >> yeah, that's true but we also have to acknowledge tech has come down further to go. i'm not saying you're wrong about crypto being a factor here, but tech in the concentration and come down i think from 23%, probably has further to go but we're already making some inroads to that. we've seen this market can rally even as the faang stocks don't that kind of myth has been put to bed we can't rally without those stocks you know, the elections are done, okay it wasn't as red, big deal crypto, i'm not taking away from what you're saying but we've got to acknowledge at least from bitcoin it was already down 70% from its high. look, this market wants to know where the peak fed funds rate
12:08 pm
is, period last week we adjusted to the peak fed funds rate is not 4.60%, it's 5% if you get a high inflation number that peak fed fund rate is up and the market adjusts again. i don't know what the cpi is going to be. i am going to say something i feel strongly. you look at goods inflation and actually average hourly ratings it's well below what cpi is stating. things are coming down the cpi is not picking it up that's a debate for another day because the fed is focused on the cpi, but i don't think the cpi is the right indicator to use. >> do you think that we are appreciating enough the risk that surrounds cpi tomorrow being hotter again again. and what that means. we've done four 75 basis point hikes in a row
12:09 pm
we are conditioning ourselves to say, okay, the largest are over. now it's time to think about the smaller, the 50s, the 25s, the stopping and sitting and looking around that could all be thrown into question tomorrow, right >> right i think we also as participants of the market have under-appreciated what the fed has been telling us over and over and over again. why did we anticipate some kind of pivot why did we anticipate a down shift at all yet and if it does come in hotter that hope disappears what i think jerome powell has been very clear about is that 75 basis points is an unusually large hike, and i don't think they want to continue at that clip, but 50 basis points is still pretty big after more than a decade of zero just because even if they did move down to 50, that's still a big jump and not something i don't think the market has entirely digested after this rally. but i think the bigger
12:10 pm
question -- i would disagree a little bit to jim's point about the peak rate being most important. i think it's the path we get there that's most important. and the statement jerome powell made in the last meeting about i'd rather go to far and try to fix it afterwards than not go far enough so i think it's the path, the speed, and i think it's how we get there and what happens in the meantime the economy >> it's perspective, too it's perspective because 1954 the annual ten-year treasury so anything higher than zero is going to be higher all of what's happening from a longer-term perspective is really positive, but because we're so reactive and looking at just the near past, we're missing that perspective of things >> what if the report is softer? i guess there's a reason why we're not dancing with that,
12:11 pm
which is for the last 21 months i think it's been we've had one cpi report i think it was august that came in better than expectations. i'll tell you i think this market will rip on that. >> i think we're making this more complicated than it needs to be. two-year treasury is it 4% or 5%, that's the leading indicator megacap technology is it going to stop going down -- >> if byte bitcoin continues to go down, technology is going down >> okay. and if you're looking for capitulation maybe capitulation happens in the equity market >> i'm listening to you. you know i respect you, but i just don't buy into it the idea that crypto is leading this market down it's not that i think, oh, you're crazy, get out of here. i just don't think it's that big of an effect and you all know me.
12:12 pm
you think i'm investing in crypto, come on. there are a lot of guys like me looking at it -- >> does it shake sentiment >> i don't think so. >> you don't think it shakes market sentiment in the middle of the day yesterday -- >> i dent even know how to spell crypto, okay >> in the middle of the day yesterday when the market came out. >> but it went down. >> no one's is suggesting -- what do you need it to go down 10% to suggest -- jeff's point is well-made, isn't it >> it is well-made >> you still don't even know what the full fallout is at this point, do you? maybe you do >> well, there was a tell this summer, right, when all those crypto hedges go under, jp morguep didn't put out a press release, guys, guess what, we've got a big hole on our balance sheet nobody knew about. what's decoupled is crypto from
12:13 pm
the main stream financial world. i hope that doesn't change >> here, i think actually the thing that happened yesterday it's this threat of contagion, how much is everything interconnected and basically the headline a company had to be saved. nobody wants to hear a company had to be saved at the same time we're hearing a bunch of other companies are doing layoffs. that starts to be something where you look at it from an economic standpoint and think this can't be good these aren't a collection of headlines you hear in good times. >> also not just a company like one of the companies that adds to what we're talking about. the other big story today i want to get to right now dow is down 310, and we'll continue to watch that obviously led in many respects by disney the loss was much larger than expected on direct to consumer i guess the question for you as you own the stock, are you too
12:14 pm
leveraged to direct to consumer? i was thinking about that. between paramount and that i understand taking a bet on the business, but that's a big bet if you put those two together. investments are being made, there are negative cash flows in the business and this is not a year when capital costs are going up anybody wants to talk about investments that will pay off in the future. anything that has a future pay off, this market is just not interested in because capital is not free anymore okay, i get that >> you lose a billion and a half and the estimate was for a billion. >> yeah, okay, but also they pointed out that's going to improve by 200 million the next quarter and going to steadily improve by fiscal 23 >> assuming the economy doesn't
12:15 pm
take a more significant downturn >> assuming it does take a significant downturn people aren't going to cut off whether it's netflix, paramount plus or disney plus, those will be things they stay home and watch. these companies have been growing a subscriber base rapidly and consistently, and when you get past the next 12 months the pay offs for these companies are substantial. the problem is this is not a market -- >> you're also making less than -- barry diller i thought was pretty provocative the other morning on squawk where he kind of suggested the game's over, netflix won and everybody else is playing for second place at this point you look at similar or certain metrics like arpu, average revenue per user, they're lower than netflix's and they're also declining. do you pay attention to that >> of course i do. there's reasonable explanations.
12:16 pm
first off i don't think this is a winner takes all someone tell me where disney plus is right now. >> it's 160, 164 >> these are big numbers you're going to tell me those are table scraps, i'm not going to say so. i happen to come back to you on arpu in order to grow a business you have to have these partnerships that start off low whether it's with a telecom provider or whoever, that start off low and skews the arpu down, but as those customers become paying customers, the arpu goes up. >> you sold disney before the quarter, before the print recently >> i did and i grew very impatient with it, and i think in this market right now -- my strategy is be a little more active, you know that, and i think there's other
12:17 pm
opportunities. i'm finding the opportunities in the material space where you're finding supply so i'm very happy to move out of disney i think what's important from a risk management perspective, they own paramount, they own disney if i said to you, jimmy, you have to cut one, which would you cut? where's the opportunity for a fundamental recovery better present itself >> i never like to punt on a question but you know from my answer that's not where i am i've got both of them and i do see differences in them. >> they're kind of both betting on the same future >> yes, but you know what's also similar they both have legacy businesses fundsing this growth right now. this is not something i either company has to come back to the markets and say i need to do a big equity offer -- >> to scott's point, then, doesn't it require the macro environment to get better?
12:18 pm
>> i don't know. if the macro environment goes south and people don't have jobs, do they stay at home and watch paramount plus and disney plus, i think there's a reasonable case to say they do >> what do we want to do about meta which is leading the s&p today? as we said disney is a big decliner for the dow the first layoffs, by the way, in that company's higsry brad gersner wrote a to tighten their belt, calling it an important first step he tweeted that out -- this is what he said i'm going to directly quote. this is from gerstner to me. we're looking at the tide and founders are realizing this is not a moment but a permanent regime change in how they need to think and build their companies. >> i actually do want to say something. so a lot of these companies i think the narrative has shifted.
12:19 pm
and as investors the feeling about it has shifted, and it's moved from whatcan the stock d going forward to what is the company doing to protect margins? so when there's news the company is doing something to protect margins instead of spend willy-nilly on things into an environment like this that is rewarded positively in the share price. this is a little much, i think but still i think it's changed and shareholders want some sort of message that says, okay, we get it, we're doing what we can to control costs and protect margin >> let's remember we're only in a period of -- are we even a full two weeks from when meta reported maybe we're just about that time, but on the earnings report remember gerstner had put his letter outright at that time, and i think the prevailing thought was that zuckerberg was basically telling investors i'm
12:20 pm
going to do my thing, i don't really care what you say i'm going to do my thing, i control the vote i know what i'm doing. everybody else get out of the way. now this is in part a nod that he's listening to some shareholders influential and otherwise but certainly the brad gerstners of the world are important to that company. >> well, certainly at the time my response was that i was hopeful that mark zuckerberg would listen to what brad was trying to identify as opportunities for the company. but i also ahead of the earnings report and after the earnings report was incredibly, incredibly negative surrounding the future of what this company could be now, with all that being said, what i will tell you is what i am seeing for the very first time in this company is if you study momentum, and it's a factor in the market, jimmy, it's a factor in the market.
12:21 pm
for the very first time in two years you have a little bit of a bright green for momentum. so the stock right now is at 103. i can tell you that momentum points the stock more towards 120 to 125, then it does a return back down to 88 or 90 >> so before we move on your view right now of growth versus value when some, a good number of people are now trying to line up and suggest this is value's real moment not just two step forward, one step back moment but a real moment where megacap growth takes a back seat that all these other stocks are going to do much better in the months ahead if not years of these. >> i'd say backdrop supports value. i'd say from a valuation perspective it supports value. from an earnings perspective it supports value, but never in my 30-career have i seen cash flow
12:22 pm
strengthen all three of those have underperformed dramatically. i'm not going to buy it just because it underperformed, but i don't think it's as binary you need to be in growth or value. i think you have to own both a little bit if you're going to own growth own garpy growth >> that's where the debate is, though >> they come down in multiple -- >> i sold all of my facebook in december 2018 because i didn't like the direction of where the company was going in terms of this product the company still needs to be held accountable what's happening in the last two or three years in terms of performance. this company is heading in the right direction. typically that's what value stocks do when you see this type of first move. whether or not facebook is a value stock i think is too early. i think microsoft and apple could be more of garpy value stock. i think the true value is going
12:23 pm
to be health care, parts of energy, parts of industrial and maybe some parts of tech but i think from a sector basis -- >> are apple and microsoft too expensive or not >> relative to history, yes, but in terms of relative to the sector, no >> in term of where we are in the world to what's going on are they too expensive >> depends on what you want to pay for. if you want to pay for stable growth, apple and microsoft are amongst the most stable. if you're going to have a portfolio of stock, scott, you will pay a higher multiple the multiple is down 7.4 points. the average multiple contraction in a bear market is 6.4 points so the market's done its job so whether or not apple and microsoft are going to say depletion of the multiple i think it's a moot point. what you're paying for is stability of earnings. >> my issue is if the -- if the market multiple comes in even
12:24 pm
more too egregious to pay. >> i don't think so especially if you're going to right size the rest of your technology moves, and then technology positions. and then lastly people have to remember that coming out of a bear market trough, multiples go up multiples go up historically they've done so since the last 11 bear markets. so we can have a little bit higher market multiple and still have lower multiple stocks in your entire portfolio to kind of balance out owning an amor microsoft. >> great to have you here. we talked about bitcoin hitting new lows cryptos continue to feel the fall out we're following that money we do have some updates, the very lately coming up next we're back in two minutes.
12:25 pm
12:26 pm
12:27 pm
we're back on the half the crypto world still digesting the fall out from ftx. our kate rooney joins us from san francisco with the very latest what do we know today? >> crypto investors i'm talking to are still rattled by this outcome. binance's take over of ftx is still up in the air and reports the deal may not go through
12:28 pm
though a binance's spokesperson said they're still in the early phases of due diligence. while it may be a quick way to shore up quick funds some other high profile investors will likely be wiped out in the process. a $32 billion valuation back in january you had softbank, sequoia, tiger global among a lot of other big names i've been on the phone with some of the investors the last cup of days who tell me they're expecting their stakes in ftx to be essentially worthless they're planning on writing it off as a loss. i'm told binance will likely be buying ftx on what they've said pennies on the dollar and sources telling they've been scrambling, quote, to raise money for backers and also bought up potential legal issues and some investors i spoke to
12:29 pm
say they feel duped between the in disclosed ties. all of this could raise red flags for global regulators. we reached out to see if something they're investigating. no comment so far from those two. unclear, scott, what happens to ftx's celebrity endorsements either bought up the naming rights to ftx arena in miami and recorded some of the biggest brand ambassadors out there, steph curry, shaq, naomi osaka were spokespeople coin base getting hit despite saying it had no material exposure to ftx and we're seeing more caution in crypto markets as a result of all this. told clients to, quote, raise cash in the event of additional draw downs and said based on the number of unknown skel tons that could still be hiding they say
12:30 pm
it's prudent to proceed with caution. back to you, scott >> that's kate rooney with the latest there as we continue to follow this developing story the biggest question is one we asked at the outset. is there risk outside of the asset class itself that's sort of the great unknown through, you know, leverage, sentiment. i go back to sentiment sentiment's one thing. leverage is a whole other ball game >> correct so leverage has an impact on financial market stability i'm not sure that we're in that precarious position right now, but sentiment without a question will have a negative impact on risk assets, and you ask yourself the question, number one, how can we foolishly allow ourselves to be back in this position once again with the lack of oversight, the lack of regulation is putting us in this situation where we are today, where we have to even have the
12:31 pm
conversation about potential contagion. why is there no regulation in the crypto market? where is the legislation for that who is the buyer of last resort on a bailout you're playing the game of musical chairs >> the buyer of last resort. >> no, there needs to be -- there needs to be a clearinghouse. >> i know what there needs to be, but that's what it was >> okay. then that's where we are, and that's why we're sitting here having this conversation, and that's why i'm saying with such a high degree of confidence that sentiment gets shaken by something like this. maybe financial market stability doesn't, jimmy, but sentiment gets shaken. how can we be foolish enough to allow this to happen again >> i never want to get mad on my friend joe, but you said something that actually enrages me >> okay. >> like, i can go in a back
12:32 pm
alley and roll dice, i can do that anybody can do that. if there was ever a market where caveat emptor applied this was it i mean this was all about grief. it was all about grief there was no way to value these things i'm looking at the two of you. you could easily tell me -- >> why are you upset at me we're saying the same thing. >> but how are you going to regulate human emotion of greed? it's going to happen -- >> wait a second, how are you going to regulate -- >> take the issue of emotion out of it. bitcoin should never have been 68,000 it shouldn't have been 6,800 there's no way to value this thing. i can find the utility of it you can find the utility of it i cannot value these things. it's why i've stayed away. >> i don't think the argument is what's the use case necessarily. the regulation you might be suggesting so there was a
12:33 pm
liquidity problem yesterday, which is why a company needed to be saved so if there were a regulation it would force some level of reserves so to speak like in the banking industry >> you wouldn't have an individual player funding short-term costs with longer-term assets but that's the recipe for a disaster that's exactly what's happening, and it allowed bankman freed to basically get squeezed by cz >> let's ego to seema mody who has the headlines for us mid-terms in focus we begin with the republicans holding onto a key senate seat nbc news can project ron johnson will win the election in wisconsin. he was able to defeat the incumbent challenger lieutenant gov governor mandela barnes in a
12:34 pm
tight race and said there was no mathematical path for barnes to beat him it'll come down to a tight race to determine senate control. a high profile democrat in new york has conceded his house race congressman sean patrick maloney calling his opponent this morning to concede that's according to a spokesperson maloney is the first head of the house democrats campaign onto lose his own seat since 1980 and a number of ballot measures passing states across the country. nbc can project that california has voted to allow online sports betting but not in person sports betting. and in connecticut and michigan, voters there supported proposals to expand early voting and access half time report is back after this
12:35 pm
so. the new iphone 14 pro. it's amazing. yep, the camera's incredible. and you'll get our best deal. nice. but everyone should get it. everyone can get it. every new customer. and every existing customer. every iphone. every iphone. -every iphone. -every. every. iphone. ok. my work here is done. everyone gets the best deal on every iphone. best one yet. everyone gets at&t's best deals on every iphone. including up to $800 off iphone 14 pro. are you coming for my job?
12:36 pm
homegrown tomatoes...nice. i want to feel in control of my health, so i do what i can. what about screening for colon cancer? when caught in early stages it's more treatable. i'm cologuard. i'm noninvasive and i detect altered dna in your stool to find 92% of colon cancers, even in early stages. early stages? yep, it's for people 45 plus at average risk for colon cancer, not high risk. false positive and negative results may occur. ask your provider if cologuard is right for you. consider it done.
12:37 pm
what kind of movie are we gonna make? all right, welcome back to the half time report let's bring in another market voice. he's the founder of blue line capital. he's with us today good to have you here from chicago. results are on deck and those are going to break during overtime, so i will see you then but what should we expect for a
12:38 pm
stock that's been volatile you've been with us numerous times of late with what's going on with casinos. >> the push and pull of this zero covid policy is really what could propel these shares higher you've got wynn shares off about 20% year to date who knows what's happens there, it's been hard to predict and i don't think the companies themselves have anymore more clarity than i do about it >> that's part of the problem if you're an investor and jim holds the stock and talk to him in a second investors try to make these decisions and so opaque you don't know what's going to happen if at all >> it's a gamble but here's the other thing i want to point out, boston, encore boston harbor is now outearning either of the two properties in mckao right now, and commercial casinos in the
12:39 pm
united states beating only the second quarter of 2022 recession, what recession? there is no indication except the very lowest least profitable margins there is no impact from rising inflation or a looming recession. they just are not seeing it. and what you're seeing is las vegas. and remember the customers for wynn resorts and las vegas are big spenders they're the ultramy net worth individuals coming in and they are spending i expect to see that las vegas and boston are subsidizing >> can that continue that's the question, and is it enough if you're only subsidizing it but it still doesn't -- it's not a great position to be in. even if they're subsidizing if it's such an important market of china. that tempers the story >> and also why you see a guy
12:40 pm
like tillman fertita going in -- what happens when they have to go out and try to find new credit in this market? it's just not there, is tillman fertita going to play a play to take over all wynn resorts i have no clarity at all i know when a guy like this goes in and takes in a big stake at companies like wynn, it sets a lot of tongues a wagging >> from a shareholder point of view i look at this you've got an enterprise value that is worth the boston and the las vegas properties embedded in there is a zero premium call option. scott, you're doing the right thing, how long can they subsidize. we've got a las vegas investment if the call option works out, great. what happens if the market tanks, if the economy tanks and there isn't the funds with which to subsidize this, and all i'll
12:41 pm
say to that is that that has been the rub on this stock amongst other things for the better part of a year. i look at the las vegas convention and visitors authority, they put out monthly results of course with a month lag, and las vegas continues to shoot the lights out we've been talking about a recession and high inflation since april. we've been talking about these numbers should be dropping off and they're just not >> and next year they're getting formula one, the group business calender is packed, the concert schedule is packed so there's a lot going on in las vegas if you like this kind of business the other thing i wanted to point out is that wynn has an investment right now in the un united arab memeemirates this could be game changing. if this gets going who knows whether you see that become the next >> all right, i'll see you in over time. we'll do this discussion once we have some actual numbers to talk
12:42 pm
about. that's contessa brewer up next new from jp morgan about what a hot cpi would mean for stocks the note i mentioned at the top he show, we got our hands on it don't miss this next at ameriprise financial, our advice is personalized. based on your goals, whatever they may be. all that planning has paid off. looks like you can make this work. we can make this work. and the feeling of confidence that comes from our advice? i can make this work. that seems to be universal. i can make this work. i can make this work.
12:43 pm
no wonder more than 9 out of 10 clients are likely to recommend us. because advice worth listening to is advice worth talking about. ameriprise financial. ♪♪ the only thing i regret about my life was hiring local talent. if i knew about upwork. i would have hired actually talented people from all over the world. instead of talentless people from all over my house.
12:44 pm
12:45 pm
we're back i mentioned at the top of the program a note was making the rounds trying to game out cpi and what it means for the stock market in either direction, whether it's a hot report, cool report and what the s&p 500 would do it is from jp morgan it is from their data assets and alpha group. here it is, and i'm going to quote from it because some of the predictions are eye popping to say the least remember 8.2 was the september cpi. tomorrow we get the october cpi. they suggest the first line in their note 8.4 or higher that has to be much, much hotter than expected.
12:46 pm
you can see the s&p 500 go down in their minds of 4.5% to 6%, that large of a decline if it's that large of a miss to the up side for the s&p for cpi, which may see seem unlikely but nonetheless what's being talked about. a print between 8.1 and 8.3, so more or less where you were in the print last month that would mean the s&p 500 they think could be down 2 to 3%. big decline, not 5 to 6% now, better than expected prints, 7.9 to 8, so that would be below the september read. you can get a move of 1 to 1.5% higher if it's even better than that you can get an s&p higher of 2.5 to 3.5 and if you get a really good cpi report you can have a monster move in the s&p they think of between 5 and 6% so the more outsized the cpi comes in either hotter or cooler
12:47 pm
you get a much more outsized but similar move in stocks bill, i'll give you the first shot again welcome to the show yoch good to have you on. glad you made the trip in from chicago. you want to take a stap stab at this >> absolutely, thanks judge. i'm looking at the month over month number and it's been heating up last september they're looking at 0.8 coming in, so it's heating up but also a look out to november. november is going to start to cool a bit so 0.6. also i've got to look at flows and you've got to see where's the risk to you. the market was elevated. the risks were skewed to the down side. down here we're flirting in this lower bound now. if these expectations are already raised in the market and comes in a bit hot and similar to what we saw in july or june
12:48 pm
number or where we traded lower but couldn't fall through to the down side and risk to the up side -- >> this is the most important factor to game plan out december and the fed, a hotter number brings 75 back on the table for december a not so hot number maybe takes it completely off the table and you can think about smaller moves going forward to the point where you get no hikes going forward and see you what happen. >> it's fair to say this is the most important to look forward to december. every single report we get this year will the most important and next year will be the most important again. if cpi comes in right on expectations i don't think it changes much at all. and that's probably the bigger risk we didn't get any real new information. if it comes in materially low than we expect it to that actually busts my thesis, if i have a bear thesis that's a
12:49 pm
thesis buster for me and i would say we've made really decent progress and want to see the components. >> if that happens we take the electric fence away and we're going to slide over -- >> i don't think that's going to happen >> yeah, what are your expectations, jim? because you're the one who seems to have the most, you know, riding on these things because your position is, you know, different from most. >> listen, i'm being honest with you. i'm flummoxed this whole year. everyone watching that knows because i'm looking at the things that have come down and come down meaningfully i don't care if it was gasoline. i'm not going to do the whole litany prices, not all of them but most of them are coming down. cpi is still printing numbers that are eye popping fact is if you get a 7.9 i think this market is going to rip. liz, you'll change your tune
12:50 pm
you're nimble, you're smart, but who knows. the cpi has been detached from what's happening on the ground >> let's bring in mike santoli from the new york stock exchange, our senior commentator. >> you've passed around. >> i absolutely have been hearing it it's reasonable. i think maybe some context if you go down 4 to 6%, if there's another negative shock with the hot cpi that takes you essentially to the bottom end of the range. you get the monster move to the upside i don't want to take the drama out of it, even though i sometimes like to do that. that to me is what we're talking about if that's correct. we revisit the lower end of the range or we make a stab at the he higher end there has not been one downside surprise to cpi. clearly people are understandably sensitive to the possibility it's going to be another negative shock in a
12:51 pm
market that's been trying to shrug off a lot of these blows, right, that we've gotten from the tech disappointments on earnings and things like that. so i don't argue with it but i do think it's very interesting that we're hanging around here 8% above the recent lows as we, grant it, have this vigil for tomorrow the two-year note yield is not really giving back much. i do think that shows you we're on alert for the possibility that we don't get immediate relief for tomorrow. if we did, it would be a pleasant surprise. >> you want to take a stab at this crypto fallout and certainly if nothing else sentiment at the moments how you're thinking about all of this. >> it's not great. it's mostly because it's the unknown. we don't know the exposures. on the other hand if you told me bitcoin was going to be down 20% in two days, and today the nasdaq 100 is down more than 1%. to me that's not necessarily a massive ripple effect, especially when you consider the nasdaq 100 has been down 1% on a day like ten times in the last
12:52 pm
month. i don't know if that's necessarily the thing that's going to be the driver unless, you know, we start see other victims fall. >> good stuff. that's mike santoli from the stock exchange we have more trades ahead, we'll do it next so you know all you need for recovery. and you are? i'm an invesco qqq, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech. uh, how long are you... i'm done. i'm okay. ♪♪ this... is the planning effect. this is how it feels to know you have a wealth plan that covers everything that's important to you. this is what it's like to have a dedicated fidelity advisor looking at your full financial picture. making sure you have the right balance of risk and reward.
12:53 pm
and helping you plan for future generations. this is "the planning effect" from fidelity.
12:54 pm
12:55 pm
power e*trade's easy-to-use tools like dynamic charting and risk-reward analysis help make trading feel effortless and its customizable scans with social sentiment help you find and unlock opportunities in the market with powerful, easy-to-use tools power e*trade makes complex trading easier react to fast-moving markets with dynamic charting and a futures ladder that lets you place, flatten, or reverse orders so you won't miss an opportunity i started as a single mom with $2000 that lets you place, flatten, and a passion for new orleans. i'm lauren haydel owner of fluerty girl. today, my tiny online shop has grown into eight stores. we're a must-stop shop for unique nola-inspired gifts. lauren doesn't just create cool nola merch; she creates opportunities. small businesses like lauren's open doors for neighborhoods to thrive. support your community.
12:56 pm
support small business. ♪♪ we all have a purpose in life - a “why.” maybe it's perfecting that special place that you want to keep in the family... ...or passing down the family business... ...or giving back to the places that inspire you. no matter your purpose, at pnc private bank, we will work with you every step of the way to help you achieve it. so let us focus on the how. just tell us - what's your why?
12:57 pm
♪♪ . contessa is going to be back withering you need to know there, josh brown is going to reveal his latest move as well he'll be with me off the top today, kevin simpson, cameron tau dawson, let's talk about some
12:58 pm
calls before we get out of here. cisco, added to the tactical outperform list at evercore, it's up 10% in the last month farmer jim. >> is this is a low drama stock. i like it for that reason. this basically for many years tracks the s&p 500, gives you a dividend yield these are long duration projects that get spent for cisco so they're not going to get downturn, you know, in one quarter with something this is something for the long-term. you hold it in your portfolio and you just forget about it >> we talked about abbvie so many times on this show. downgraded, target goes from 140 to 155 they're cutting their forecast for earnings as well, double-digits. what do you think? >> there may not be the frgreatt fundamental story, there is a tremendous tech line cash flow, free cash flow 17.8%
12:59 pm
through 2022. >> stock has pulled back, offense, defense, value growth, whatever you want from abbvie it delivers. >> and quickly, jimmy, i know you want it too, but i want to spin you forward to these payment stocks today affirm, upstart getting smoked does it change the way that, i don't know what you were going to say. >> i don't know. >> i know you don't. >> can i finish? thanks >> does it change the way investors should think about payment stocks in general? >> they're generally long duration stocks, generally, okay and i think there's crazy money to be made in the traditional financials where the earnings are here now and the price-to-books are very cheap, so i see the better risk reward in the traditionals. >> give me a final trade. >> bristol-myers. >> i'm active, i'm nimble, looking for paypal after tomorrow. >> so you're undeterred, you don't think this means anything broader picture about any of these stocks >> i think paypal is overperforming relative strength against the q's right now. i think it's levitating after earnings and it's requgoing to
1:00 pm
higher if this market returns. >> ten-year treasury, i think fear starts to drive those yields down and prices up. >> we're going to see how that moves tomorrow with cpi. finally joe. >> i'll see jimmy's bristol mier and raise him a merck. >> that does it for us, thanks for watching i'll see you in the ot "the exchange" begins right now. thanks so much, scott, hi, everybody, i'm melissa lee stocks lower, some key earnings disappoint, and control of congress remains unclear we'll dive into it all. plus, the ftx effect, how far reaching is the company's liquidity crunch, who's on the hook for losses. and volkswagen going zero to 60 on evs predicting the u.s. will be a major player by 2030. the company's new america group ceo will join us live in studio with how he plans to reach that goal we begin with the markets and bob pisani at the new york stock exchange >> and melissa, very interesting


info Stream Only

Uploaded by TV Archive on