Facebook, amazon, alphabet and apple. The risks hanging over them and the tech trade. Goldman taking a big bite out of apple, slashing its price target on the stock by 25 . Its our call of the day. The Investment Committee is ready to go. Halftime report starts right now. Your Investment Committee today and im told one of forbes top 100 financial advisers. Thats good. Also the chief Investment Officer at boston private wealth. So here is your setup. The dow now looking at its longest winning streak since may of 2018. If went up on the dow today higher, it will be eight straight day. I know no professionals watch the dow. I get it. We can hear that all the time. It is a thing. Its something that appears on general news, the usa today or nightly news. It will pop up when we hit the numbers. Does a record high make any difference from a market psychology or investable perspective . I think its important. I think there is some element that record high means something. I think the other thing we have to put in perspective is that we continue to talk about all of the volatility that we have experienced over the last couple of months. When you look at where we are from how much we declined from the previous highs, you have to put into perspective that we havent had significant drops here. The equity market moves higher over time. We would expect that over the course of the cycle, if we continue to see solid, positive Economic Growth and there remains really no other place to go with the funds that the equity market would continue to move higher. Does buying beget buying . Does the market run bring new people, new money into the market i think it brings money that has been in the market and it repositions it in a different shape or form that leaves the s p to move higher. I think a lot of the money that im talking about that has been kind of reshaped was hiding out in other places. Should you be hobby structurally. How can any person argue . We are sitting right below alltime highs for the s p. If the year was to close today and we were to close, i think we would all be very happy. It seems like we have been talking about it all week that. I want to add to that. There have been 219 new record alltime highs since the market bottomed now almost a little bit more than a decade ago in march of 2009. If every time we made one of those 219 new highs, we said all right, it would have been the wrong decision. I also think we had this move higher in safety trade that is now looking increasingly clownish. Its below its top which is about two weeks ago. Lets take a look at the zero coupon bonding. Finally, look at silver, slv which is down about nine or 9. 5 from the spike higher. This was supposed to be the safe money. So i think the lesson here is you can get momentum in anything, even things that are supposed to be for safety like treasuries, like gold and silver. This market has been designed to frustrate everyone. We have gotten most of the juice out of the orange at least we think. So we are derisking a bit. We are derisking more internationally where there is more exposure to trade partly because we dont think markets are pricing in all the volatility we are going to see. We are doing some of the same trades. We think as a baseline that trade environment we will escalate to that m. I think we are using it as an opportunity to go from our accounts all year to being slightly under weight and that is reflected in the areas that are eye of the storm assets as it relates to trade. I havent changed my outlook at all. Thanks for coming. The fact that we are right here again against highs, im just as bullish as i was when i decried some of the folks that were telling people to get out of the market just two weeks ago when the ten year was down there at a buck 50. I think someone has stolen it. Someone said seriously . A lot more. Let me finish my thought on that topic. In the world of 80 negative Interest Rates and very low Interest Rates in the u. S. , what is the right multiple that you should have on stocks and arguably it should be higher. I think once we get through the intermediate term and you start to dance around stall speed as it relates to the economic trajectory, we are going to also see as we move into next year, pro economic policies, trump does not get reelected without economic strength. So i think in the under mediate realm sounds like you are agreeing. Consumer confidence beating again. Im talking about clients. Most clients have diversified portfolios which include multiple assets. Im not a bear. You know that. I have been a bull for a very long time. All im saying is rebalance to slight under weight and then wait it out and reposition back in. You guys actually agree with each other, i think, about the united states. What youre saying, if you have a portfolio that is 50 equities, what i think you are saying is that 15 thats emerging markets, weight that down, sell some of that and add to the other stuff. Within the u. S. I do agree with john, too. We have a very consumeroriented focus, because the consumer is very, very strong. Its a manufacturing section of the economy that has decel rated. We saw this in 2015 in the consumer. We saw the same trade. The repricing that is going into the market right now in the last three weeks all assets has to do with the economic numbers pricing out what we feared. We feared a consumer recession. Youre correct. We were talking about a potential consumer recession. We are now in the process of pricing that possibility out of the market again. I think thats very reflective in the equities market. And certainly when you see a ten year at 1. 87. I feel like this is sort of what we were waiting for as we were moving away from the momentum factor. What types of senctors should start to perform well, the market that we have experienced over the last week or so should give us more comfort that were moving into a period where we could get that lift to the equity market. If i look in the very short term, there is not much that i see that could potentially derail the rotation that were seeing and some strength were seeing across sectors. There are two types of decelerations. There is going from 85 on the turnpike to 75. Youre still moving. You have slowed down, but you are still moving. Then you go from 75 to 25. Thats an entirely different type of deceleration. I would say we already went from 85 to 75. For me, its determining what the pace of that deceleration. I dont think we go to 25. We will talk more about this, as well. Dominic chu has a market flash. I teased you like three times. Thank you very much. I really appreciate it. Value wise, could financials be one of those value sectors they have been an under performer. Today with rising Interest Rates, you have the Regional Bank etf up like 8. 5 this week. That makes it on pace for the best week since 2016. To put something in context here, that is up 17 so far this year. But its down 11 over the course of the past 12 months. So stalled out there. Take a look at some of the standout names. You have peoples United Financial and then bank of the ozarks up ten percent, as well. If there is a value orientation, the question is whether traders and investors think financials fit into that particular value play. The thing i love about dominic chu is the guy doesnt miss anything. When we talk about financials, we always talk about the big boys. You run down a list this month, linking national, 17 , ameriprize. Northern trust, bb t. Theyre all up double digit percentages in what is supposed to be the worst month of the year for the equity market. Lets add cincinnati financial. Lets add citizens financial. Lets add Huntington Bank corps. These are regional ranks that are benefitting from a 16 basis point steepening in the two to ten spread since august 28 and a consumer who continues to exhibit consumption behavior that is friendly to the economy. Plain and simple. That environment will farewell. I know those guys that are like everyone is bullish again. Im bearish. Jp morgan just burst through today to renew alltime record high. You can think you are smarter than the market. When you get leadership. Look at walmart. Look at target. Massive gap higher. Gave absolutely nothing back. Nike is set up to make a new all time record high. Semi conductors. This probably makes a new high next week. One of the cleanest charts in the dow, proctor gamble. Look at the action in the stock. Incredible chart. These are not all breaking out and firmly in bull market territory because this is a fadable new high here. You are welcome to fade every day. Its obviously moved up because of some of the value repositioning that we have talked about. It moved up because of backup in rates. Personally, i close that trade. I think there is a lot of head winds for financials in the short run, most notably of which are negative rates abroad which keeps our Interest Rates tethered low. No one has talked about this company, American Express. We talk about these banks participating. American express is not. Its down this month. Its down over the last three months when you have master krd, visa, all these other names doing really well. You think with your spending alone ostocks would be at a record high. Anybody have a take . It was an outperformer for a bit after multiple years. It has had a decent year. Multiple years of under performance there. And thats why it played catch up for a while. Its not participating in the recent run. This morning . Over the last three months. Listen. I dont know, man. Thats okay. Its down. 30 points this year. Im asking if it is a value trade because it hasnt hit record highs like other names. It sticks out as a giant company that hasnt participated. I totally disagree with you. I have been long American Express for the better part of the last two years. The stock topped out off of earnings at 1. 29. The expectations for earnings were incredibly high. They missed slightly on what those expectations were. The outlook was a little bit conservative. I think this company will be fine. Thats all i was looking for. Why is everyone barking at me about American Express. Im out. Its up 100 in 36 months. It has doubled in three years. Its weird to hear it phrased under performer. Last 90 days. I was wondering if it was an opportunity. 15 times earnings, slightly below market multiple, sure. See what we did there. You need to spend more money. Im on it. You should see his pool bar bills in vegas. Are you going to light it up on amex . I will. Good discussion there. And two of them with their own card. This is why i have to start drinking before the show. Here is what is coming up on the Halftime Report. Goldman slashing price target on apple thmpt Investment Committee debates it in our call of the day. Plus jon seeing usl unua activity in the options market. His latest trades are straight ahead. The Halftime Report is back in two minutes. I get it all the time. Have you lost weight . Of course i have ever since i started renting from national. Because national lets me lose the wait at the counter. And choose any car in the aisle. And i dont wait when i return, thanks to drop go. At national, i can lose the wait. And keep it off. Looking good, patrick. I know. vo go national. Go like a pro. Hi, this is joe. I dpaut to tell you, i love the ask halftime segment. The traders and i love answering the questions at the end of the show. How do you do it go to cnbc. Com halftime or get us on twitter with the hashtag ask halftime. It is now time for your call of the day. Apple shares are the biggest drag on the dow today. The analyst read rating is neutral. He slashed his target down to 165 from 187. It is one of the lowest on the street, and its call frg more than 20 down side. This is a wonky call. The first couple of paragraphs is about how apple tv is being priced and shifts revenue from hardware to services on the balance sheet. Its kind of a wonky accounting based call. Its an interesting call because most investors dont understand the call. To your point, it is about accounting. Its not about content or anything related. So its really something that you have to understand. Listen, i think the Performance Today in apple is a little bit discouraging from a technical perspective its got a gap that is showing a break down. There could be further down side pressure. Overall, youre talking about a company that the fundamentals are incredibly strong on. And the prevailing trend points towards it making new highs frmpt whatever the day or coming weeks might lead, you might see some pressure. I think its technically oriented. I thought this was an ease, not a straight out downgrade as far as even though they dropped the price from 187 so they missed that pretty bad because we were 220 when they downgraded to 165. But Katie Huberty two days ago took it to 247. I would rather follow who is right whoompt has been right there were some good points. I think you get into a little bit of a gap space between 212 and 217. We like that every 60day period the stock has been positive. So thats going back through the last four releases. We have an upgrade cycle coming for the 6 and 6 s. We think that is actually a little bit under priced. I see the report. I think once you dig into it there is merit to the argument. I feel like there has to be something bigger that im missing. It reminded me of accounting in college. The guy is talking about if you buy an iphone you get a free apple tv plus subscription. And they will shift it to a discount on the services side. The analyst is trying to tell us that apple is making a more Seismic Shift in the way of accounts than we think but will reduce the price of the iphone by 60. I think the analyst did a great job of confusing everyone. Its almost over. You have to have an accounting degree. What im trying to prepare the viewers for is that for the first time you might see a technically driven narrative surrounding apple and it might be one that points for a little bit of selling pressure. I dont think it takes away from an overall very strong fundamental story on apple. Just being prepared to know that there might be pressure based on near term chart. Goldman has been upgrading and downgrading this stock multiple times a year every year for the last 15 years when it has gone from 10 to 220. I like to print these reports and eat my lunch on top of them. I really dont understand why Something Like this where they are shifting how they account for the revenue would be enough to drop a stock or make a stock go higher. The company absolutely is becoming more of a consumer staple, less of a consumer hardware play and more of a Consumer Services play on top of it. Anyone who doesnt understand that probably just woke up this morning. Its not terribly relevant. I think its an interesting way of thinking about how they are going to be accounting revenue. There is something more in here because otherwise there are a lot of accounting lessons. We have all been there and done that. Lets see where the stock goes after that. Do you think the apple card for the analysts works has Anyone Around the table gotten the apple card. Which is with goldman. More on the tech trade ahead. Plus seeing unusual activity in the options market. You have to stay with us to get his latest tderas. The Halftime Report is back after this. The dow up 46. Be working harde. Thats why your cash automatically goes into a Money Market Fund when you open a new account. Just another reminder of the value youll find at fidelity. I know that every single time that i suit up, there is a chance thats the last time. 300 miles per hour, thats where i feel normal. I might be crazy but im not stupid. Having an annuity tells me retirement is protected. Annuities can provide protected income for life. Learn more at retireyourrisk. Org [horn honks] man this is what i feel like when i wear regular shoes, cramped and uncomfortable. We can arrange a little upgrade. Which is why i wear skechers. Wide fit shoes. They have extra room throughout. Theyre like a luxury ride for my feet. Try skechers wide fit shoes. Servicenow put ouruxury this changes everything. Youre right sir. Everything. No not everything, i mean youre still blatantly sucking up to me gary. Brilliantly observed, sir. Always three steps ahead. Six steps ahead. Sixteen. So many steps. You done . A million steps ahead. Servicenow. Works for you. Welcome back everyone. Im sue herera. Here is your cnbc news update. Boris johnson says he is cautiously optimistic about getting a new withdrawal deal with the eu by october 31. He was fielding questions at a convention in the northern english town. Im seeing president of the commission and the chief negotiator on monday. Well talk about the ideas that we have been working on. Well see where we get. I would say im cautiously optimistic. A huge transport strike in paris paralyzing the french capital and its suburbs as unions protests sweeping pension reforms. Ten metro lines were closed and several others were severely disrupted in what may be the biggest disruption since 2007. A protester interrupted an event where former White House Press Secretary Sean Spicer was set to appear. The protester ran on stage and was taken down by police. And that is the news update at this hour. Sue herera, pretty dramatic video there. On semi conductor, that stock has surged more than eight percent in a week. Options traders are prepare frg more gains ahead. Lets find out why we say that. What are you seeing with o. N. . They are buying calls aggressively in this name. They have been right so far. Lets see if they continue to be right. Theyre taking a shot all the way out into april. April, 25 calls with the stock. Just over 20. Does that mean that they believe it goes through 25 and back and might have been around 26. They are paying a dollar for the calls. They bought 30,000. Thats 3 million share equivalent in this name today. Its a lot of buying. Big block. So what does that mean im in these and will be in them for months. Its just five percent of the value of buying stock because youre controlling upside for a dollar versus 20 on the table. Take a look at whats going on in rambus. It was its up over 14 bucks. They were buying september calls very short dated. The ones i focussed on was the october 14 issue. They also bought an awful lot of those as you can see. Its up over 5,000 contracts there now. Shorter term, probably in them two to three weeks. Rambus not a name not a name we have talked about in a decade. Maybe even longer than a decade. It might be way back to the new rambus movie is coming out. I feel like the critics were like overly harsh. Big technology under fire. The antitrust investigation. Asking companies to turn over documents related to documents. This follows attorneys general launching an investigation. Facebook has confirmed it is under investigation by the ftc. The one thing that we have not seen is a big drop in any of these stocks. How come because when they get the reports from the tech companies, the Judiciary Committee doesnt understand what they are reading. Its plain and simple. We continue to have this regulatory pressure on large cap technology, Mega Cap Technology names and the policy makers that are summoning these executives to whether its washington, d. C. Or europe, they really dont understand the business itself. I think if youre looking for policing within the technology business, i think it has to come from the executives in technology itself. They want to be selfregulator because then they can write their regulation. Dont punish me, mom. How about if i go to my room for a day . You create your own reality. For the Investor Base you want that. You do not want people that dont understand the industry writing the regulations. And thats the fear that you can have as an investor. I think the reality and its reflected in the stock prices is the Investor Community is smart enough to know that thats not going to be the end result. We have to think about this in terms of what we can prove. If this is not like in europe where you can Fine Companies for competitive harm, you have to prove consumer harm according to our current regulations and regulatory environment. Absent higher prices thats the only quantifiable and given that the average price is free. I think this is going to take a really long time for all of these government officials to realize they dont know what they are looking at and dont think it will harm these companies at all. We just recently went attack this week or last week. And part of it is in tactical portfolios we are looking to take advantage of valuations reaching decade highs and the fact that we think they are very exposed to trade. I think thats a trade issue. This is a headline issue. I dont think you can overreact to the headline issues unless they become pervasive. Was this part of your thesis or literally Everything Else how come this wasnt part of that why arent more people worried about this if they talk about breaking up alphabet or google there seems to be a school of thought that if that was the worst Case Scenario it might unlock value in alphabet. Those seeds have not been completely sewn to react to. I think we do know how well technology has done recently. We know valuations and earnings deceleration. There are haves and have nots and Companies Like apple that are potentially exposed to both of these. So i think in the more intermediate term if you believe trade is going to play out exactly as outlined by the president , Technology Companies are going to come under some pressure. I think you will be sensitive to that and more focussed to the consumer side of the economy. Good discussion there. A big story coming up on big technology. Straight ahead here, the desk will answer your questions. Of course you know this, but you can reach us at cnbc. Com halftime or tweet at us. We have your questions coming up. Nasdaq just turning negative. Looks like no record highs today. Will we actually break the win streak tell him were flexible. Dont worry. My dutch is ok. Just ok . in dutch tell him we need this merger. in dutch its happening. just ok is not ok. Especially when it comes to your network. At t is americas best Wireless Network according to americas biggest test. Now with 5g evolution. The first step to 5g. More for your thing. Thats our thing. Heres whats coming up on the exchange. Its the most highly anticipated ipo since uber. Who is at risk well dig in. The fed is heading into next weeks meeting in a situation unlike any other we have seen before. We explain why and what to expect because of it. And millennials getting priced out of their local housing markets are turning to the internet to buy Properties Sight unseen in markets they can possibly afford. Now back to the halftime crew. Thank you very much. We look forward to that. We have a lot of Great Questions coming in. Its friday the 13th. Maybe we get spooky ones. First up, sam in minneapolis. Are we really asking this question. I revealed on the show how poorly the performance was after earnings. Obviously, that was a very discouraging p l for me at the end of the day when i was getting out 28 lower and i said i wouldnt talk about this name again. This name is broken. This name is broken. It disappointed me. It is a name that i dont want to the technicals got you into it right before they shot the market. That happens. Sometimes you are in a great stock. Earnings are growing. Then they shock you with the decel rating quarter of sales. Everyone rethinks the stock. I think joe said im not buying it here. I understand that things are cheaper and things have changed. You think you guys are spending too much time together . Who the three of you. John in california said do you buy, sell or i dont know this company fundamentally. I did take a look at the technicals. Stock has a huge gap. It looks like its about to fight to get back into that gap. If youre looking at this as a trade, you want to see what happens at the top of the gap which were not there yet. I think thats kind of like a moment in truth. It could be snapping the down trend. I know it is counter intuitive to say here is an 18 stock. You want to see if it can get back above where the gap took place. If not, you could be in a frustrating situation. A question on macys. Michael inconnecticut wants to know if this is a good buy at this point. We have seen a little bit of strength near term in macys. Thats been what joe is talking about. This company has low operating margin, low Free Cash Flow. Its operating in an environment that continues to come under pressure from a number of different directions. So despite the fact that we have seen some relative value in it more recently, i wouldnt be a buyer here. Randall in san diego. Asked if you should sell chewy before earnings next week. I would not be selling chewy ahead of that. I saw this put on the list. I know tiger global has put it on their list. We all know how 13 ds work. I like it here right around the 30 level. Finally, daniel in South Carolina says does it make any sense to buy into Consumer Discretionary and Consumer Staples . Go long the American Consumer everything. I think thats where the strength is. We are overweight both those sectors within our u. S. Neutral. Its the points that john was making earlier on the show as it relates to Consumer Discretionary. You have strong labor and low debt service cost, low mortgage wrats. I think there is fundamental support there. Within the staples side, you have a defensive characteristic. You have growth improving and a focus on operational efficiency. So with valuations being reasonable, i think you can own both. You love the American Consumer, dont you . The consimate consumer is the American Consumer. Everybodys bet against consumers lost bigly. Bond years are actually on the rise lately. The future crews will take you through the trades. Mark your calendars. Jeff gundlach sounding off right here next wednesday. Thats what they call a big one. Not going to want to miss that. Were back in two minutes right after this. For farmers here, this is our lifes work. But when a recall happens, perfectly good food goes to waste. Now, weve got away around that. Looks good. Were on target. Blockchain on the ibm cloud helps pinpoint a problem anywhere from farm to shelf. Its used by some of the biggest retailers everywhere. A nice wedge. So more food ends up on your table, is that daddys lettuce . Yeah. And less food goes to waste. I can. The two words whispered at the start of every race. Every new job. And attempt to parallel park. electrical current buzzing each new draft of every novel. typing clicks the finishing touch on every masterpiece. newborn cries it is humanitys official twoword war cry. Words that move us all forward. The same two words that Capital Group believes have the power to improve lives. And that, for over 85 years, have inspired us to help people achieve their financial goals. Talk to your advisor or consultant for investment risks and information. With sofi, get your credit cards right by consolidating your Credit Card Debt into one monthly payment. And get your Interest Rate right. So you can save big. Get a nofee personal loan up to 100k. Doprevagen is the number oneild mempharmacistrecommendeding . Memory support brand. You can find it in the vitamin aisle in stores everywhere. Prevagen. Healthier brain. Better life. Welcome back to the Halftime Report. Im seema mody. The ten year yield is on fire this week as equities rally in hopes of a trade war resolution rise. How much trust can we really put into this weeks rally in the ten year i think we can put a lot of trust in it. When you look at interesting rates, they have rallied hard. 195 was sort of a support level. It seems like we want to retest that. Maybe we maybe go back down towards the 150 mark but if you are not dumping trerk treasury, i think it is crazy. We can didnt see below 150 for a very long time unless raid talks reverse itself i think the rally is here to stay and is there a path above 2 on the ten year . I think months of june and july it zigzagged just north of 2 in think it is heading back to that area. Probably things have to change, perhaps the trade war has to actually be solved, but i think that it is heading back there. Thanks, gentlemen check out futuresnow. Cnbc. Com. Halftime report is back right after this indistinguishable muttering that was awful. Why are you so good at this . Had a coach in high school. Really helped me up my game. I had a coach. Math. Ooh. So, why dont traders have coaches . Who says they dont . Coach mcadoo you know, at td ameritrade, we offer free access to coaches and a full education curriculum just to help you improve your skills. Boom mad skills. Education to take your trading to the next level. Only with td ameritrade. Every curve, every innovation, every feeling. A product of mastery. Lease the 2019 es 350 for 379 a month for 36 months. Experience amazing at your lexus dealer. I think that if you look being at their commitment to provide 50 of their Free Cash Flow back to investors and continue to look at furthering their growth, i think that the stock is probably selling off unnecessarily here but we have seen competitive firms indicate that they are actually starting to see a recovery in chip demand. So i think that is where there is a bit of a disconnect between what broad com said today and what weve heard from other competitors. Meantime ge moves to go counsel to 38 billion of asset sales. Looking to get the debt load down for a long time and they have been cutting into it, but that is the issue with ge. I think just yesterday perhaps he was talking about cutting it pretty dramatically. So people get a little more optimistic if they think that he has a possibility of achieving that goal. Stock up 30 this year and still at 9. 50 just simply incredible and they made everybody move from connecticut to boston and then now unbelievable. What sf wrong wiis wrong witt tough when you pack up your house and then the company starts to shrink im not knocking boston, im knocking ge. Boston sports fans have a problem with it. Thats right. Delivering alpha investor summit is back. It is the ninth year already in new york and just Getting Better every year you have a big lineup of ceos, even cnbc talent floating around and no better talent than leslie picker who is joining us with a preview before. Oh, my gsh. You just go just for you. Thank you, that is so niles of you i have to have someone around the table like me. Ill be the token brian fan on six kay, delivering alpha will bring together some of the brightest minds. Among those speaking, cliff robbins, glen kacher and there have baeen some whack trends for example, there are factors for inflation or for minimum stroll ti volatility but this month there was a sharp declining in the momentum factor and big rise in value. Hedge funds were largely positioned in the opposite way long momentum short value. So the moves could make for a dent in their september returns. Yesterday we were told what they think is the cause i think the trigger is likely this reversal in the ten year that weve had this month. That kind got it going and because of how much capital is set up to chase these factor moves, it really stretches things on out to an extreme. There is a whopping 1. 9 trillion which they expect to triple this and other topics will fill the day of delivering alpha with other notable speters who include Vice President mike pence, david taylor, nelson peltz and also mary e rcherdos. So good stuff final trades quickly usb jpmorgan staying long and van guard extended duration and ipg and twou, it is a 19 stock and they are buying the 22. 50s during the show. Great hour, thank you all for doing it and thank you for watching have a great weekend the exchange begins now. Hi, everybody. Here is what is ahead. Markets almost touching alltime highs. If we get a trade deal, how much higher will stocks go or will it be a buy the rumor and sell the news event well debate that. Plus new york, london, d. C. , chicago and all of these cities, we work oig is the Largest Office tenant. What happens if the company cant pay its bills. Well ask as ipo prospects keep dwindling. And the fed meeting just days away and a major rebound in global Interest Rates. With markets still
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