A lot of uncertainty globally. I think youll see money continue to come here in the u. S. , and i think that youre going to probably see quality dividend stories that have been working, continue to work, but i also think youll see maybe small caps start to do a little better, and i wouldnt just say you want to be in defensive stocks like the utilities and telecom. You want a feel of them, but also you want some of the cyclical names, too, that have yield. Buy industrials with a 4 , 5 dividend yield . Saying both could be good . A bar bell in the u. S. In the u. S. Normally you dont move meyy higher on bonds and stocks. Whats going on here . Youre right, melissa. Its been a wonderful rally. You and i spent time sunday night, thought wed get a rally this week. We did. This is as far as it goes, i think, tell you the truth. Dont think well break to a new high. The real issue for me whats going on in the u. S. Economy . What stephanie said is right. It youre getting good earnings reports you need Economic Growth behind it, particularly here in the u. S. We got a good ism number today. True. But its prebrexit. The jobs report next week, may be good, if you trust weekly jobless claims, again, before brexit. Its not going to be until later in the month of july we start to see, has there been any effect, particularly on the consumer from brexit, and so the point im making is, youre sort of in nomansland as far as this rally going higher into you get a read or postbrexit news. Central banks flooding the system. We know they were going to, they told us they were and they have. Why Interest Rates are down. Not down here because they see a gang buster economy. Because they want to mitigate some of the fallout from brexit, because we still dont know exactly how fpunitive europe could be. Merkel doesnt want to act until article 50 is enacted. If thats the case, could be another three, four months before we get that. My particular thinking that could cause us to slide, and i think thats why theyre flooding the system with liquidity here. To see the bond yield in the u. S. 145 and the 30year Mortgage Rates basically right at the lowest level in history, and in all honesty, going lower, i think thats telling you the story about how much aggression there is on the part of the Central Banks to keep this under control. Skeptical of the rally so far . I mean, that what it sounds like bottom line . Not really. The more they force rates down, theyre forcing money into the markets. One of the things they were concerned about, of course, flight. Its not happening. The other is, okay, how do they get some job creation going in particular, of course, in europe where theyve got such a big recession on the way. Right. Most of europe. Should we be concerned, josh, money is being forced into the markets because there is no alternative that notion of tina. Is that the right reason to be long stocks . Especially defensive stocks that may have higher valuations in the overall s p 500 . Maybe makes sense a little, but these things get taken to the nth degree and become ridiculous. Every bubble is based on a kernel of truth. There is a kernel of truth theres a Global Demographic situation where Everyone Needs incomeproducing assets, older people around the world are looking for something that yields something. And as a result, you get people plowing money into bonds all over the world, and so thats true, but then the question becomes, so does that justify hersheys getting acquired at 26 times earnings . Justify utilities up 20 this year, and selling at 20 times earnings . Probably not. The truth is always somewhere in the middle. Melissa, big picture, skeptical of any rally. The last, the first three days of this week, up about 1,000 dow points. The ninth largest dowpoint gain over a threeday period in history. Typically that doesnt happen in the context of a rising market. Usually happens after theres been some big tremor. So i would say there is a possibility its a dead cap bounce. Really hard to know. Probably not worth making a big bet on just yet. The weird thing, the week prior we thought the world was coming to an end because of brexit and metal goes up 1,000 dow points, you mentioned, and 90 of all the brexit losses doesnt normally happen. Totally doesnt. Own equities that act like bonds, a nice dividend a good Balance Sheet. Like i actually like, again, a lot of the bar bells approach. I have some of the food stocks, staples that are expensive and keep me up at night but theyll continue to work, especially if you have all of this m a. A wonderful sector finding share hold value for shareholders. Energy stocks, energy, are down and cheap and very attractive. You do want a combination. Just want to point out one ironic piece. Quickly. When volatility spikes people run into sovereign bonds pushing down rates which has a net effect of pushing people back into the same stocks stephanie mentions. Playing out for a while. Yields with such lows and stocks the only alternative, in the second half . And seeing earnings and valuations weigh on the market . Bob pisani joins us now from the new york stock exchange. Thats the point here. Take a look at the issue. The issues framed simply. The bulls say there is no alternative to stocks. Thats tina, of course. The bears say, earnings and valuations are really too high right now. And where you come down depends on how you feel about all of this. Theres plenty alternatives. Tina is not really true. Look whats going on with gold and the high yield etfs. Munies, new highs the last couple of months. Also rates on the dollar are a major problem for earnings, estimates in the second half of the year. Already seen banks takes a hit on kearns about rates lower for longer. And dick my old friends, trading like it is an issue. Then the dollar issue. The dollar got clobbered the end of last year, and a lot of the materials and energy and industrial stocks had major problems with the dollar strengthening at the end of the year. We had this earlier in the week with the dollar up. Its still not clear which way its going right now but thats certainly an issue. Heres the question how much upside is there in the market now . My sense is, minimal upside. 135, estimate, for 2017. Always optimistic on the part of analysts. Normal multiple, 17, say 2300. 200 points for the upside of the s p about a 10 upside for next year on the s p. Remember, this is the optimistic scenario. The down side, of course, we dont really know, with the u. S. Elections, italian constitutional referendum and other unknowns, a bigger down side than just 10 . I think were in a trading range, 10 more on the upside and significantly more on the downside. Back to you. Bob, thanks so much. With that backdrop we note today marks the first day of trading for the second half of the year. Pitting some of the Popular Companies against each other to see which is a better bet for your portfolio. First pairing, apple voersz microsoft. Dr. J, what you do you say . Apple, second half. Iphone 7 coming our way. Muss coney center, make that announcement show us the device rather than the leaked photos. I think thats a slam dunk versus microsoft. J. B. . Both charts in nomansland. Own either fundamentally. I like both dpi companies and own apple, would buy microsoft. Great yields and buybacks but going nowhere. Switch it up. Amazon versus walmart . Steph . I struggled with this, actually. I do think walmart is interesting given the Balance Sheet what theyre doing in terms of investing in the business, the yield. Exactly the stock people will gravitate towards. What you were talking about . Exactly. Hard to go with amazon. What . Doesnt make sense. Because i think secular trends are powerful at amazon. Very expensive. Always a hard time over the valuation. This company is doing a great job and a lot to do on the retail or consumer side prime. A lot more they can penetrate, and, therefore, see sales growth accelerate, and of course the cloud business. Which theyre the leader in, will continue to be the khalider i the leader in. Probably breaking out to a new leg higher. The hardest time when i bought this stock on this show. Thats why it will work. Crazy, you all picked amazon. The deep value guy. Classic value pick. Exactly. The secular trend talking about. Buying online, not going to stores. Right. Exxon versus bp, dr. J. Bp. Why . Because of british pound. I know theyve got exposure around the world. This is not the only place, but if you had the choice, and i can buy it and you can buy it in british pounds, i like buying that and getting the potential thats there. A lot of folks saying, okay. British pound to 1. 20 versus the u. S. Dollar. Lets see. Havent been right about much about this brexit. See if theyre right about that. I dont think they are. Also go ahead. A much better yield that are exxon mobile. In either name youre playing a directional move on the energy prices. Who knows where theyll go. Meantime, a better pay while the wait from bp. Exxon going to 100. You picked exxon . Its going. All right. Young versus mcdonalds . Steph link . Yum. I think you have the catalyst with the china spin. Why i recently bought it in my own portfolio and sold mcdonalds. Theirs is a great story. Eastbrook doing a lot rehave youring the company. A lot more they can do. For yum, less popular but also think you have a catalyst and the spin, but i will say this, i do not expect a good quarter coming up for any of these stocks. Clearly the trends have been slowing in the qsr space. Right. Odd man out with mcdonalds . Why . Yeah. Steph mentions easterbrook, still doing a great job and i dont think the next thing is a mcpizza. Just people although that sounds kind of good. It does sound kind of good. I think theyll continue to come in, because of the poll of breakfast anytime. It brings people in more often, and then theyre going to rotate over to some of the other offerings when not eating mcmuffins or whatever the heck mcthings that they eat. What the mc is. Coming up in the Halftime Report announcer still ahead, the call of the day is a bullish bet on netflix. Should you be streaming into the stock . Plus tesla under pressure after a driver dies while using the companys autopilot system. What that story means for the stock, and the future of selfdriving cars. And patriotic trades. Today we celebrate our Independence Day announcer as the Halftime Report gears up for the fourth of july were looking for investments that would make the Founding Fathers proud. When a moment turns romantic why pause to take a pill . Or stop to find a bathroom . Cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. Do not take cialis if you take nitrates for chest pain, or adempas for pulmonary hypertension, as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. Side effects may include headache, upset stomach, delayed backache or muscle ache. To avoid longterm injury, get medical help right away for an erection lasting more than four hours. If you have any sudden decrease or loss in hearing or vision, or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. Ask your doctor about cialis and a 200 savings card. Welcome back to Halftime Report. A firm giving the stock 120 target on confidence and sustained subscriber growth. Michael graham, the analyst behind the call joining us live from new york city for our call of the day. Thanks for joining us. Thank for having me. Youre confident in the medium term, long term but its the next couple quarters that might be rocky. How rocky and why initial a buy knowing the thex two quarters will be rocky . Well, its a good question. We dont know that the next two quarters will be bumpy. We like to take a little bit of a longerterm view for our stock ratings so we take a oneyear time horizon setting price targets, thinking about returns in a stock. The next two quarters may be a little bit bumpy because of some nearterm subscriber head winds. The rio coming up, pulling you away from ondemand. Subscriber base in the u. S. Going through a price increase over the next couple quarters, which may create churns. A few things in the near term that give us a little bit of pause, but we feel really comfortable that over the long term the story will shift to the International Subscriber growth, and weve got a lot of reasons for thinking that the companys going to do really well. They Just Launched in 160 countries in q1 and we think thats good growth opportunity. What do you factor in in terms of the brexit fallout on international grouth since the International Component is such an important driver . The uk you point out in 2016, projecting 6. 2 million paid subscribers and a list of basically all of these countries that are members of the eu right now where economists rationing down their growth forecasts . Yeah. Brexit will probably be a slight headwind. Its tough to quantify that. This is a consumer product. Not like a bank or financial services, you know, product. A lot of people are subscribers and unlikely to cancel because of breck it. Well have to see what happens, but a lot of the growth that we are looking for is coming from noneu countries as well. A pretty balanced growth picture. Michael, stephanie link. Curious what you think about margins, because they have been heavily investing around the world, as you say, and we will eventually see that growth. Any room for the upside and what you think that means for the stock . One of the central questions now. We really think that company is trying to build a huge content engine. Theyre taking a lot of their revenue and profit and plowing it back into developing original content. We try to quantify how big of a investment that could be going forward. Its important for netflix to do that, because then they own the content and they can display the content around the World Without paying more money. We think that theyre going to keep margins low for quite some time as they go through this process, but in the long term, theres a lot of margin leverage after that, because they dont have to pay license fees anymore and own the content. Its going to be a bit of a typical internet Growth Company story where they keep investing a little bit like amazon has done, but longer term we think margin leverage. Michael, thanks for joining us. Michael graham, initiating netflix at a buy rating. 5 pop on the day. Josh brown what do you think . A growth stock, value the new growth . Yeah. So its got support going back to the First Quarter of 2015, and about 80. Seems to be where it wants to bottom. You can own it here, but im skeptical theyll be able to create enough original content that will offset the threat of things like, the disney deal running up, for example. Disney is Just One Company probably of many that are saying what do we really need these guys for if we can figure out our own app, our own over the top solution for subscribers directly to our content . So i think thats something that people should be more focused on, and when you do that, you say, well, are there ten more house of cards coming out of netflix . Probably the answer is, no. Well, you know, everybodys talking about the International Expansion efforts, and my thought is there, if you have europe having potential problems, i dont think thats where you really want to put your money. Stock trades at 330 times trailing earnings, 92 times forward earning, priced for perfection. I agree with josh the chart does look like its going to go lower from here, and 80, that would be a good 17 below where it is now. I really want to stay away from this. On brexit, and granted the whole market selloff, it sold off a quick 7 . The kind of market environment, is that the kind of stock you want to be in in a year in which utilities, past 12 months, up 22 and netflix is down 16 . Is this one to own . That one and tesla, gut those big whooshes down, mel, theyve been buys. So 9 drop you describe accur e accurately last week was a great buy. I didnt buy it, but it is a great buy, looking where it is now. Press back up over to 100, 102 . Probably. I think tests that again, but i would take it as a trade. Im not in the stock length term. Coming up, harleydavidson in overdrive today surging double digits. The reason why and how to trade it, thats next. And now may be the perfect time to buy a house as Mortgage Rates are knee alltime lows, but is it the best time to buy housing stocks . That and much more ahead on the Halftime Report. Products an, but they demand the best shopping experiences. Theyre your customers. And by blending physical with digital, cognizant is helping 8 of the 10 largest u. S. Retailers meet their demands with more responsive retail models. Ones that transcend channels and locations, anticipate expectations. Creating new ways to engage at every imaginable touchpoint. Its a new day in retail, and together, were building the store of the future. Digital works for retail. Lets talk about how digital works for your business. Welcome back to fast money Halftime Report. A move based on a report from street account, interested in making a 65 share bid for harleydavidson. Similar rumors circulated in 2010, kkr was crested in making a bid for harleydavidson though the deal never materialized. Shares of harley up 12 in todays session. Bring it to your attention. Courtney reagan, thanks. And seeing options activity as well in this . Yep. Im in the name. Both short puts and long calls in harleydavidson. Is it going to happen, though . I dont know, of course. Over the next two weeks, it might. Friday, and the reason i say two weeks is because they were aggressively trading july options. Its probably something very short term but basically last friday traded about 4. 7 million shares. Double normal activity. On monday traded almost double normal activity. That was before this rumor came out and before shares spiked 12 . So, yeah, im in it. You know if youre in it, jon, you have to see this rumor play out, because otherwise theres really no justification for being up 12 . Of course. This is a highly discretionary item. Its trading above its normal pe, and look, i still have questions about the economy that are not going to be answered for several weeks. An air pocket here if the rumors dont come out. They need strong sales in places like asia and europe. The people that have youre not going to get t. Maybe not, right. So the global thing was why you owned harleydavidson the last few years, and it didnt work. Stock 70 in 2014 and just saw that whole idea of Global Growth vanish and nothings replaced it. All right. Coming up, the fatal tesla model s crash means for the future of selfdriving cars. Phil lebeau has the latest. Plus, the good, the bad and most unusual. Trading up a storm, in the latest options bet. Thats next. Welcome back to the Halftime Report. Now lets get to sue herera with the latest headlines. Hi, melissa. Whats happening at this hour president obama says Congress Must end its deadlock on funding the zika virus before heed they out to recess. His comments amp meeting with Health Officials in the oval office. The good news is that we feel fairly confident that we can develop a effective vaccine for zika. The problem is that that money is stuck in congress. Bill cosbys lawyers will ask a judge to odor the accuser in his criminal assault case to refund the money he paid her to settle the lawsuit a decade ago arguing they violated the agreement speaking to police who then reopened the case against cosby last year. The families of some of the nine People Killed in the Charleston Church last year are sewering the fbi saying the client is concerns about gun safety and hope that theyre lawsuit will lead to changes. Traffic deaths rose 8 in 2015 to 35,200. Highest number of People Killed on the road since 2008. The percentage increase is the highest annual jump since 1966. Officials cite an increase in vehicle miles traveled spurred by lower gas prices. So be careful out there. Especially on a holiday weekend. Back to you, and beware of traffic. You know about that. Thank you, sue. Sure. With stocks in rally mode, resident Value Investors always on the hunt for names the market may be underpricings we hit steph first. Looking at some biotech stocks, hit hard. Really . I know. You would never say some are values and some of the names i talk about are not exactly super cheap. Saljean at alexion, looking better. The Political Uncertainty is out there. Thats a concern. Theyve massively underperformed. Celgene, in terms of pipe line, a good one. With patience, the company can grow at 20 , 25 over the coming years. Gilead needs a deal. At eight times forward estimates, Everybody Knows that and a great Balance Sheet and buying back value stock and alexion, not a value in terms of 20 times forward but growing 25 , 30 and this orphan drug status in the industry is an industry leader. Those are the three i would look at. A subset where youre going . Interesting, fishing in the same waters, or nearby waters. Im looking at large cap pharma, steph, thinking pfizer, bristolmyers. I own pfizer. Boring stocks. Own them for the yield. All have good yield, sort of in the 3 range. All three breaking out recently. Pfizer looking at a multiyear high here soon and defensive in what have been volatile times. The main news for all three, very strong in oncology, and cancer medicine is something thats going to be growing for at least the foreseeable future. So i like being in these names. Theyre cheaply valued, good Growth Potential and great yields. Watching shares of tesla, meantime. Virtually flat today and this as u. S. Regulators launch an investigation into the cars autopilot feature after a driver was killed in florida. Our phil lebeau has the latest on this developing story. Melissa a Number Details coming out giving a better sense what happened when this accident took place may 7th. Video of the driver that he posted on youtube, on the today show driving his model s. Not the day of the accident. This is prior to that, of him saying, look, i love my model s and youll see a picture of him driving handsfree in a little bit. The gentleman killed in the crash in florida. Heres where the accident happened. This might give a better sense of how the collision took place. The model s was going down a highway. There you see it going down highway 27. The truck turned in front of him. Now, tesla says he did not see the truck and because it was a brightly lit sky behind the white tractor trailer, the cameras in the autopilot system did not pick them up, but that gives a better sense of where the accident took place. Remember, tesla has said from the beginning as it rolled out the beta test version of the autopilot system, as a driver, you have to stay engaged. You have to stay alert. In fact, it tells you, periodically, you need to grab the Steering Wheel. Something that is somewhat overlooked. The data recorders for the model s in this investigation, there is been downloaded by the nhtsa investigators and looking at that data now as you look at shares of tesla. Traded down after hours yesterday but has since come back and now you see that its slightly lower. Other news regarding autonomous drive vehicles, bmw, intel and others in munich, germany announcing they plan to build a fully autonomous car, sale days, 2021, well ahead of what many other people were forecasting for their cars. By the way, this is not like theyll release it and drive it anywhere in the world. They expect it to be only used or driven in limited areas. Basically put up a geofence saying this is where the autonomous drive software officially will work. After that press conference in germany, mobile eye was making comments regarding the tesla accident, melissa, and mobile eye says this software in the autopilot for tesla was not designed for this type of accident that happened in florida. In other words, the mobile pilot designed to keep you in your lane. Lane alift, not autonomous drive Software Designed to maneuver the car around from start to finish in your drive. So thats the latest on this investigation, but a lot of focus on these autonomous drive vehicles. Comments made by tesla, never designed to prevent these sort of lateral collisions, and its in the works but wont be on the road until 2018. You have to wonder, phil, obviously investors are saying this may be a oneoff tofor tes, according to stocks reaction, but could it slow down the reaction of autonomous vehicles, getting them on the road . Regulators might say, slow down and see whats going on . Its possible. You could have regulators say, look, this was a oneoff accident and the technology is really impressive and coming along, but we want to slow down how quickly were allowing automakers to implement that technology. A definite possibility. Yeah. A big risk there. Phil, thank you. You bet. Phil lebeau with the very latest on that tragic tesla accident. What do we make of the stock . Its remarkable, i think, that you get this headline and everybody thought this first headline, the first fatality, is going to be a huge risk. Here we are, shares are flat. Wrap do you think . Kind of surprising for sure, but i think that youre going to unfortunately hear more and more about these things. And i think that thats the responsibility of the agency to begin with. So i dont think you sell the stock because of this. I dont think that this derails the story. Its not my kind of stock in terms of valuation. But i am in intel, actually and do think its interesting that theyre trying to diversify and get into this business even further than they already have. So thats the way im playing it, but i dont think this is kind of doomsday for tesla. Obviously very sad, but you know, whenever somebody gets hurt or worse, but hes the software is not ready for primetime yet. The way ive heard it phrased is, tell me the difference between snorkeling and scuba diving. You wouldnt put a snorkel in your mouth and go 1,000 feet belos the surface. Its not designed to function that way. And a little bit of that element. I dont think these stocks should get hit as though they dont work or theres something wrong with the technology. No one is suggesting its the driver. Technology be used for this. Its the driver. Unfortunately. Requires you to touch the Steering Wheel once in a while. If you dont check in doing that, it automatically slows down. And raises questions about how soon make it available to the common man or woman. You mean completely autonomous as opposed to autopilot, already on the road . And or autopilot. Its out there, but since there are guys like this posting videos and doing the wrong thing, driving or basically letting the car drive itself, i think thats a danger. I mean, i dont think that thats something that they should just have available to folks, because theyre going to assume that, oh, this is ay proved and will do all the right things. Youre a mobile eye. Bullish. Dont you think that will slow the adoption . You just said it . Its not going to affect business . Mobile y and bmw said, steph talked about, speed it to 2021, i think. Were at 2016. I dont think it should be available right now in 2016 for auto driving, or for autopilot, and autonomous. I dont think it should be, until approved by the national Highway Safety administration and so forth. The reality, though, is the march of progress continues when you look at the onset of commercial flight in the united states, there were obviously accidents that didnt go perfectly well. There are going to be more of these, not less. The technology will not be flawless on day one. People that try to be an early adapter do so at their own peril, but thats the way it is with all technological progress. Unfortunate but part of the way things get better. Deep thoughts with josh brown. Coming up, disney, nike, fedex on the move. The trader blitz. Heading to the break, take a look at the s p 500 heat sector map. Led in stress utilities, and bring it up after this. Announcer the Halftime Report with scott wapner, the play for moving interviews. You dont call a company a sewer because a company made a mistake. We are short. Real debates. People think globalization hurt businesses. Its not. It is technology thats hurt businesses. Competition is a good thing. I dont want to go back to a single marketplace. The most profitable hour of the trading day. I love this show. All i do is get to tweet about the show. Im on the show. The greatest moment 6 my life. The Halftime Report, weekdays, noon eastern. Its here, but its going by fast. The opportunity of the year is back the mercedesbenz summer event. Get to your dealer today for incredible onceaseason offers, and start firing up those grilles. Lease the c300 for 379 a month at your local mercedesbenz dealer. Mercedesbenz. The best or nothing. Real is touching a ray. Amazing is moving like one. Real is making new friends. Amazing is getting this close. Real is an animal rescue. Amazing is over twentyseven thousand of them. There is only one place where real and amazing live. Seaworld. Real. Amazing a good car has to maneuver quickly. Thats also true of a good car company. People have always bought cars. But we saw an opportunity in sharing cars. So we moved fast and launched car2go in 29 cities, all around the world. Doing that required dozens of data centers, designed for speed and performance. We built our business on the ibm cloud. Because thats what the ibm cloud is built for. All right. Wearing two hats today. Today on power lunch, forget about summer vacation. How to make money from other peoples trips. Dr. Doom and glook gloom with us. See what he thinks. Enough to change his tune . Probably not. Maybe. Might be the time. This is it. And stocks after a business missed spelling big opportunity . All ahead on power lunch starts at the top of the hour. First to unusual options activity. Dr. J, three trades, good, bad and new . Not the good, bad and ugly. Good news, junior miners. This one just off to the races basically a call. The july 8th expiration, 4150 calls, they were bought. I bought them as well, for about 1. 26. Hit 3. A very good trade. To be fair, tell you about a bad trade. Hyg. Highyield corporate bonds. Unusual put activity, jump in for 1. 90. With index around 82sthe index went straight up, clappollapsed down, i exited. Fresh one now. X. Take a look at whats going on in u. S. Steelto today. Somebody bought 6,000 or 7,000. I say same second, hits on the screen, public it out on twitter in a second, all in at same second, bang, bang, bang, bang, bang, bang, rapid fire of these calls at about a 30 premium to where the stock is trading right now. What do you make of that . Not saying its a takeover. Sounds like it. 30 premium . A bet on materials going higher and obviously steel and some material stocks, talked about commodities like gdx. Are you in all of these trades . Out of hyg. Dumped that one for a loss. Still in half of the gdxj and in in a big way in u. S. Steel. I like the u. S. Steel. Choreographed the gang sign thing. Cool. Makes me bullish. Follow through on the metaphor. Thank you. In terms of gold, jim, do you see that as a place to be . Obviously, its had a great run. I think really for the markets in general and this includes gold, were stuck right now. Theres not enough gold stuck, too . I do think that. I think not enough Economic Activity to move markets including gold higher. Having said that, more volatility as summer goes on around news of brexit, europe, possibly other countries leaving lending to florida gold, not a trade i want in because i dont see it go anywhere. Five trades today . Job cuts, josh . I dont understand why anyones an investor in this name. Had the same conversation, what . Before the show. Goes from 8 to 14 in a month and a half. Why people are in it. No. For the trade, i get it. Just a terrible business, and not necessarily a wellrun company. Layered on top of a bad business. So, no thanks. Shakeup in nikes boardroom. Tell them what you think. All right. Shakeup in nikes boardroom, replaced by a ceo and apple steve cook lead independent director on the board since 2005. We knew phil knight would resign. Parker taking over makes sense. I dont like tim cook coming in as lead director. Why . Tim cook has a fulltime job running apple. Enough threats and opportunities to keep him perfectly busy doing that. Doing a director is not a trivial job. The lead independent job especially not trivial. I dont like his eye taken off the ball whats going on in apple . Negative for apple. Nikes fine. Still own apple. Doesnt make me run out and sell it, i just dont like it. Disney buying a stake in video unit advanced media according to bloomberg. Something like 3. 5 billion, the value. I dont think its a needle mover but i like the fact the Company Continues to diversify. Theme parks are starting to do very well. The studio continues to do well. The problem with the stock, trading against 17 times forward estimates and cord cutting issues with espn as an overhang. I would like to buy it cheaper. And directors resigns from williams board after abandon a deal to buy the company . A wegxit. Six directors including the chairman resigned, fail to toss the ceo, as mel said. Bad news also that ete Energy Transfer deal didnt go through. Both stocks are down today. I would think that they both continue to go down in the short term. Fedex upgraded to outperform and research . Like it . Dare i say, fedxit . Fedex it. Dropped down from earnings supply and seems to run right at the top of that gap. You have a flat 200 day. Not much going on here and trades almost like a referendum on Global Growth, which i dont think you want on the bull side of that necessarily. So im not a fan. Good company. Maybe just not a great time to own it. It is a fedexit. Coined that. Boom genius. Up next, diana olicks realty check as Mortgage Rates chop. Half way through the year, and how stephanie link is planning to turn things around in the second half and the stock jim is tossing out of his portfolio. Thats next. Announcer want to hear more from our experts . Head to cnbc. Com halftime for exclusive commentary and behindthescenes access. S what are you doing right now . Making a cake ayla reminds me of like a master chef and emiana reminds me of like a monster chef. Uh oh. I dont see cake, i just see mess. Its like awful. It feels like i am not actually cleaning it up whats that make mommy do . doorbell whats that . Swiffer wetjet. So much stuff coming up. This is amazing woah. Wow. Now i feel more like making a mess is part of growing up. Stop cleaning. Start swiffering. Great time for a shiny floor wax, no . Not if you just put the finishing touches on your latest masterpiece. Timings important. Comcast business knows that. Thats why you can schedule an installation at a time that works for you. Even late at night, or on the weekend, if thats what you need. Because you have enough to worry about. I did not see that coming. Dont deal with disruptions. Get Better Internet installed on your schedule. Comcast business. Built for business. Welcome back to the Halftime Report. Mortgage rates near all time lows. Were joined by cnbcs diana olick. Diana, how low . Well, melissa, im calling it the brexit benefit to u. S. Homeowners and potential buyers. Take a look the average rate on a popular 30year fixed mortgage dropped nearly a quarter of a percentage point in just ten days. More importantly the rate held in the past two days even as bond yields rose slightly. Today the yield is down again on the 10year amid a global bond rally. Were not quite at record lows yet on the 30year fixed. We need another 0. 125 drop. That would take another drop like brexit. Even then lenders would be tough because theyre already very, very busy with todays rates. If they drop too far too fast they might see clients bail out of locks and try to go lower. It is to say the least unexpected in generates are still so low today when you look back a year 0. 75 lower and that includes the fed rate hike at the end of last year. Yes, we saw a little pop up, but you can see Mortgage Rates have been far more dependent on Global Economic issues than readings on the u. S. Economy which have been improving. That said we did see weaker than expected Construction Spending in may. Analysts had been expecting a rebound from april. Spending on housing was flat. There was a 1. 8 increase in apartment construction, but that was offset by a 1. 3 drop in Single Family home building. Thank you, diana olick in washington for us. So what do you do here at this point . Do you think rates lower for longer, Mortgage Rates specifically obviously, is that good . I mean, does it motivate anybody to buy anything. If you werent buying a house now, a quarter of a point lower mortgage is not what drives you. I think the Home Builders have been in a range for a while. They dont seem to want to break out or down. But the housing picture is good. Im watching itb. Im looking for a break above 29. 5. Builders specifically. Yeah, because if you buy the more popular one, xhp, you get like retail mix stuff. Electrical sockets or whatever. I dont want that. The itb, 29. 5 thats the level if it breaks above definitively you could get some momentum here which hasnt been around for a while. Interesting. Im on the other side from you, josh, on that one. Well, could break down too. Im more in the derivative plays. I like the home depots, the u. S. Gypsums, carpets and dry wall that sort of thing. The housing markets as far as that goes theyve been in starts and fits for the last two years. Its hard to say rates going lower as josh was saying is going to release the flood gates for buying. So i do think however theres going to be remodeling and theres going to be new decoration for the homes that are bought. So thats why i like those names i just mentioned. Worry about home depot sort of stalling out here . Maybe a little bit, but i think thats why you want to diversify, mel, not just have home depot, have those other names too. Really tough comps for that name. They have just been crushing it for a long, long, long time. They may run out of levers to pull at some point. But, you know, im constructive on the remodeling trade as well. You like home depot. I love home depot. My one cautionary note here on those Home Builders beyond what these guys have said is just their cost of acquisition for land. I know weve talked with bill pulte and others here about it. Its not fire sale. Youre paying up. And thats generally not a good prescription for these guys when they pay up for land if indeed they do. Thats why they dont have the inventory. I totally agree on the land side of things as well. So i actually added to lowes last week when it fell. Not much, but i like that its u. S. Predominantly north america, right . I like the fact they have some margin upside and i think trends are going to continue. I like lowes better too. Its a little bit cheaper, but i think you have better margin upside. And also their comps are at a discount to home depot. Im not saying theyre going to be able to get to home depots rate, but i think they can make progress especially as they build out the pro part of their business. Ive owned it and added to it. Coming up, as we head into the long fourth of july weekend, we are getting the desks most patriotic trades. Halftime report back after this. Proud of you, son. Ge a manufacturer. Well thats why i dug this out for you. Its your grandpappys hammer and he would have wanted you to have it. It meant a lot to him. Yes, ge makes powerful machines. But ill be writing the code that will allow those machines to share information with each other. Ill be changing the way the world works. interrupting you cant pick it up, can you . Go ahead. He cant lift the hammer. Its okay though youre going to change the world. With new cabinets this wfrom this shop,house, with handles designed here, made here, shipped from here, on this plane flown by this pilot, who owns stock in this company, that builds big things and provides benefits to this woman, with new cabinets. They all have insurance crafted personally for them. Not just coverage, craftsmanship. Not just insured. Chubb insured. Lets take a look at the leaderboard. Jim back in the lead in making a trade today. I got rid of marathon petroleum, the refiner. I want to be very clear i still like the stock for the longterm, but this is a shortterm trading game. Weve got six months left and were going into a long weekend, mel, i want to take a little risk off the table. Theres three days worth of news feeds that can come out, all sorts of headlines. Ill pick a replacement next week, but the stocks been up 17 . It was time to ring the bell. All right. Steph has had a bit of a tough run so far this year. You could say so, yes. Lets really dwell on that. Yes, please, please. Steph, whats your turnaround strategy for the second half . Melissa, the First Quarter is where i really got hit the hardest where the market took a swoon in january and february, instead of holding my ground like i do in my normal workday portfolio, i tried to trade around it. And thats just not me. I then tried to get myself out of it by trading around in the Second Quarter and it just didnt work. So anyway, ive picked five names i really like, high quality, high conviction. Sometimes catalysts, some dont. But its very diversified. Im going to stand my ground and see where it goes. Its a shortterm competition, but im better at longterm. And so im just going to hold these names. So five names and thats it. Thats it. Thats all we get. The key is to pick one name and put all the money in. [ laughter ] because you lose either way. You can sell calls against that too. Stocks is not enough. Right, right. So remember you can follow all the action at cnbc. Com pro to see what these guys are all up to. With the july 4th weekend ahead lets get the desks most patriotic trades. Dr. J. Amazon. I would say mr. Bezos killing it. And thats an allamerican company. And hes beaten everybody anywhere on earth. Thats an allamerican winner. J. B. Sam adams boston beer company. Im in this name and its not gone well, but i think there are signs that a bottom is in. And i think competition is being way overstated. Company will come back. Steph. Kraft heinz, they make hot dogs and ketchup but also have a margin improve story. I think theyre going to get in the mix of her sshey and that whole thing. Everybody remember baseball, hot dogs, apple pie and chevrolet . No. General motors. When was that from 1968 . Probably. That does it for Halftime Report. Ill see you in an hour. Meantime power lunch is going to get underway right now, guys. All right. Welcome to power lunch. Melissa, take the next hour off. Youve earned it. Well see you in one hour. Welcome to power lunch. Michele is back. Nice to have you here. Great to be here. Brian is here and im tyler mathisen. What a week it has been on thursday before the british vote to leave the eu the dow was at 18,011. Then came big drops friday and monday and a drop of 871 points to 17,140. This is the path the markets have taken. Right now the dow sits at 17,960. Thats up 30 points or about a fifth of a percent. That means in one week the dow has traveled