Election. What do you do here . The rotation in the financials and i think you can stick with those. Yesterday i took off a lot of the financial positions, took off a few more today. Scott, when you look at whats going on now, howard ludnick was on last night talking about how regulations, if those were put down a little bit, a little bit softer, druckenmiller again said exactly the same thing. If thats the case, that means the financials have room to run and theres plenty of room. There might be even more room. The paper we have been seeing flowing in there, 95,000 bank of america calls were bought yesterday midday, scott. And then sudden ly they come in today for the xlf. Theyve been coming in for almost anything financial. E trade was just a few days ago. They continue to come in for those. When i say they, i mean those with big, big, deep pockets coming in saying the financials are going high. Is this a play out of tech into more cyclical, more value areas, if you will, industrials, materials, energy, the areas where money is coming out of and going into . Its a little bit of that, scott, because in all cases unless people literally had just a ton of cash on the sideline, we hear that all the time. Oh, theres so much cash on the sideline. To some extent and in some accounts there was. For an awful lot of folks you have to rotate out of something to buy something else. So what would you rotate out of with amazon screaming up to the levels it was at or facebook and some of these others . I bought amazon on that harsh selloff today because it was down, what, 6 or 7 . I bought some there. Flipped it. Now im short at the 200day moving average. Im short puts. Im not short amazon. Im short putsigates me. Theyre looking around for do i want to stick with these or go where fixed income trading will be through the roof over with the banks where loan growth will be through the roof. Nothing focuses the mind like the gallows. If you have to borrow or refinance youre focused on the Interest Rates going up, judge. That it will be great for jpmorgan, bank america. Its rotation but its a rotation not necessarily just from stock sector into other stock sector. Its rotation from fixed income from bonds into stocks. Yep. And, by the way, scott, that actually makes it easier for investors who have had cash on the sidelines because they dont want to invest in bonds to invest in bonds. You go back and we were good 45 basis points lower on the ten year treasury. Corporate and Municipal Bonds as well. People i advise i wouldnt tell them to buy bonds a month ago. Now im telling them they can get into it at the three to four year duration. Pick up that 1. 5 to 2 taxfree municipal yield. We talked about high yield as an equity replace. We did that for a month on the show. That is what youre seeing right now. Youve seen a 40 basis point move. Youve seen the u. S. Dollar continue to rise. That is the specific reason why the register is being run right now in technology. Thats it. When you look at technology as a sector, the earnings are fantastic, the opportunity and the vision for 2017 as it relates to m a is fantastic. Right now in the moment youre talking about not the market which ive been trying to emphasize over the last couple of days but youre talking about sectors. And when you look back to what you talked with pete about financials, they experience every tail wind collectively that theyve been missing over the last five years. Youre talking about the repeal of dol fiduciary, about less regulation, and while youre doing it, scott, youre lifting rates. Thats absolutely incredibly bullish for financials in a sector where everyone is under invested. This notion of sort of moving out of bonds and into stocks was one that Stan Druckenmiller addressed himself this morning on squawk box. I want to talk about it. Here is what he said. I basically have a large bet on economic growth. How do i do that . Im short bonds globally. Im short bonds, short italian bonds, im short u. S. Bonds. Thats all reflective of not some disaster with deficit but with stronger growth. The reason why he says hes out of gold. So what happened to negative rates . Now hes short bubbles, as he said, bonds. We discussed whether donald trump was the election of donald trump would pop the bond bubble. Steve weiss said yes. Others, i believe, think the same thing it. A reflation trade and some of the trades you thought would work before are not. What donald trump has done is getting central bankers away from negative rate policy which was the conversation collectively everywhere over the last six months. U. S. Rates has lifted global yields and forcing what had been a safe haven, forcing ins institutions, Large Holdings of global bonds, forcing it out. Okay, where is the cash going to go . Where is the opportunity going to be . Its going to be industrials. Its going to be materials. Its going to be financials. And a little bit in health care. Well, for more on rates lets bring in rick with black rock, the chief investment officer, joins us live from new york city. Welcome. Its good to see you today. Druckenmiller said rates are going up, going up a lot. Im sure you heard about these comments. What do you think . Where are rates going . What does it all mean . Hes a smart guy. I would say theres a lot of efficacy in what he said. When people talk about bonds, i think the comments earlier were spot on. When people talk about bonds theres parts of the different curve. The fed is not changing tomorrow. It could evolve, certainly in 2018. The front end of the yield curve, we think theres money still in fixed income. One of the things the Central Banks have talked about we talked about on your show a couple weeks ago, financial transmission works through Monetary Policy into the Banking System and now as you let rates elevate a little bit, rates are too low. You let them elevate, then you can create velocity and growth in the economy and there is truth to that. What about the comments on squawk from greenspan said yields were not at normal levels. He even sees the ten year moving to 4 or 4. 5 . Do you agree with comments like that . Hes not saying overnight. I dont. I dont. I dont because there are a couple of things happening. While i do think the term structure of Interest Rates isnt right, and i do think the back end of the yield curve could elevate from where we are today, its not taking into account we live in a Global Environment where the bid from International Investors the u. S. , by the way, is even cheaper than the rest of the world and we do see demand coming in from overseas. Do i think rates move up . We could see 2 ten year. Do i think it could go up still a bit more . I do. Were not going back because of the Growth Paradigm well be better. Its not rampant and inflation is picking up but still not rampant. I think we could elevate from here for sure. You dont subscribe to this notion that if there is something that would finally topple the bopped bubble that Donald Trumps election is the catalyst a lot of people didnt foresee coming and now its here . So i think there are a couple of things that are important. One, i think its a lot of focus on the president ial election. You also have a congress that has shifted that allows you to actually do some things that people are reacting to today which i wouldnt disagree with the argument about how equities can benefit from that. I do disagree with the bubble dynamic because what has happened in the world today, the demand for income is so profound, the demand you saw it play out in stocks as well as bonds. The demand for income is still there. Where do you find equilibrium, Interest Rates can move up. Front end and particularly yielding assets in it the front end that things like parts of the highyield market, parts of the securitization market where theres real yield without a lot of are Interest Rate risk is where people will go. Do you reject the notion out of hand of a bond bubble period . So i reject that its a bubble. What im not rejecting is that term structure of Interest Rates has been held down, distorted too low, that we could elevate more from where we are today. I reject the concept. A bubble burst because of too much supply relative demand. Heretofore it has greatly outclipsed the demand dynamic. Wouldnt you say 50 basis points move in the tenyear treasury in one month is a tricking of a bubble, thats an enormous move. I think thats getting lost in this context of, well, will it go it further . Its already had a huge move. Very fair point in that i think what people are starting to realize is long end are Interest Rates have a lot of Price Sensitivity today because rates have been held so low, because you can create a price dynamic that is significant. If you think about it in context were talking about a ten year, not an elevation of Interest Rates. A 2 ten year. We have to get started somewhere, right . I agree. And, by the way, do i think we can elevate more . Yes. I would argue the point we are at today, were too distorted low going back where we were two, three weeks ago, a month ago and now were getting closer to equilibrium and will get closer to that as well. It depends what the definition of equilibrium really is. Well talk to you soon. Rick rieder. We do have Jeffrey Gundlach tomorrow. He called the election of donald trump. What all happens now in the markets with president elect trump. Tomorrow of double line. Here is what else is coming up. Financials on fire. Will the rally weve seen following Donald Trumps victory last. One of the most followed analysts on the street joins us next. Plus, bank of america thinks one dow stock is on the verge of a double digit rally. We debate our call of the day ahead. And shake shack on a tear following its earnings. Are burgers back . The Halftime Report with scott wapner is back after this. Opportunities arent always obvious. Sometimes they just drop in. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. Our mission at clover is to highest Quality Dairy products. Clover has relationships with 27 different family farms. The environment is who clover is. Without it, were nothing. Pg es been a great partner. Theyre the energy experts, were the milk guys. Pg e worked with clover on a number of Energy Efficiency projects to save energy every month. If youre part of the fabric of the community, youve got to ensure that you do things right, environment included. Learn how you can save at pge. Com save together, were building a better california. Emerging markets are on the move and not in the positive direction today. This has been one of the most popular trades this year, scott, up about 12 , but you falling in todays trade under pressure and what im hearing speaking to different analysts and strategists who track the emerging markets what is in focus is president elect Donald Trumps trade policies, the intention of these antitrade policies potentially pressuring the relationship or redefining the relationship that washington has with trading partners specifically in asia. Another topic in focus is tariffs. There has been in the past a proposed tariff by donald trump of 45 on chinese goods and some of the analysts say that could result in a significant decline in china gdp by as much as 4 talking about china, the worlds second largest economy. A big slowdown there could, of course, have global ramifications. Were seeing em under pressure. Brazil down about 7 . The e it tf. The pay so, i should point out, still under pressure losing 8 today. Another 2 . The big stand out here, scott, looking at emerging markets, the russian markets and the russian ruble and the prospect of stronger relations between the u. S. , the United States and russia with trump in the white house. Thank you, talking about emerging markets. What about this trade now . Big, big, big reversal. The brazil trade in particular was down 5 , down 7 , then down 10 today. Its come back to being down just a little under 7 but that is just something that people overstayed their welcome there. Theyre going to be hitting the exits for days to come. Its not a oneday event. Done with this trade . It no longer works . Higher dollar . You have to make a distinction between emerging markets that will be developed markets like a china, like an india. The average no, no, this is important. The average investor watching is not going to distinguish between or take the time to distinguish between one emerging market they should. People are invested in the eem. Do you buy it or not . Just tell me. No. No. No, you dont. Thats what im getting at. Its the most heavily weighted in korea. The eem. You have to know whats in these etfs and if you want brazil you trade the ewz. Like i say im stay iing away fm that one now, scott. Thats the one down 7 . Yep. Financial stocks are on a tear rising nearly 10 in the past week coming off their best day in five years following the results of the election. For more lets bring in Bank Analyst Mike Mayo of clsa. Good to see you. Thanks for coming back. You raise d your price target o every single Major Financial Institution after the election of donald trump. Well, weve raised our price target several times this year since we were on your show in the spring when the bank stocks were at a low. Bank stocks are keyed up for outperformance. This is the end of a sevenyear drought. Seven years banks have been fighting head winds. If theyre teed up whats the driver to continue that to put it way out in the fairway . Well, the driver is youve had headwinds of rates, revenues and regulation and theyre at an inflex point, a sevenyear inflection point. Youre going to see now if you have higher shortterm rates that would be good. If you have higher longterm rates that would be good. Regulatory relief. You have all three, the trifecta for banks and so youre at that inflex point. But what we are saying now, what we said on your show consistently this year, this is a structural breakout for this decade banks have been building up record capital. Record liquidity. Now with a progrowth a administration youre going to see banks redeploy the excess capital. You want to comment on some of this fodder about jamie dimon and being at least even considered if in fact he is for treasury . Well, we also have a note on jpmorgan, as you know. We call jpmorgan the lebron james of banking because they have not only offense but also defense. And defense theyve had incredible Risk Reduction thats under appreciated. Now they should have some offense. Is lebron james more about the rank and file or more about the score in the top office . Its absolutely both. I brought my lebron james bobble head. This is our symbol for jpmorgan. When it comes to jamie dimon for treasury secretary, if you could have lebron james on your team, you absolutely go for it. Lebron james, it is jpmorgan as a firm but the top the firm could be considered do they have a dwyane wade . Should have a tom brady. Thats what you need. Unlocking cash in the financial industry right now is the opportunity going to be there for m a to finally happen now that banks are comfortable using the cash . And who could be acquired . Weve been on the show talking about comerica, the ceo has been in place for 14 years the stock has under performed. Theyre not fully optimized. Since we went to the annual meeting they have taken additional steps to optimize but we still think comerica is a potential takeover target and with stock Prices Higher it makes it easier to pay the big premiums we saw in times past. Can i take the other side for a second . Donald trump, everybody is now all of a sudden in the blink of an eye dismissing a lot of the rhetoric that you heard on the campaign trail because of one speech that he gave at the hilton on election night. In Donald Trumps closing, his twominute commercial at the very end of the campaign he mentioned Financial Institutions and he had a picture of Lloyd Blankfein in that ad. Are we too quick to think that donald trump the campaign er is not going to be donald trump the president . Well, during the campaign the floodgates are open. You raised the price target on every single financial you cover. We were positive before. Were positive after. You have a republican senate, republican house, republican president. So i think for the Banking Industry youve avoided some scenarios that have been tougher from a Bank Regulatory standpoint. So were certainly positive. Now you said on the campaign trail, lets bring back eagle. This is the end of the financial crisis. The financial crisis finally ended november 8, 2016. Youve gone now from bashing the banks to get votes with the electorate to facilitating economic growth. You cant always have it both ways. If you want growth, youre going to need banks to be your partner to lend more of that money. Banks have built up 1 trillion of extra cash. 3 trillion of deposits. You want to put more of that money to work do you think dodd frank gets repealed . No but its a matter of finalize roles and get on with it. Do you think it will . Alan greenspan said get rid of it. Icahn with me said dont. What do you think happens . The difference between what i should think and will happen what do you think will happen . I think it will be tweaked. Tweaked around the edges. The lack of piling on tweaked that it has a Material Impact on the banks bottom lines . Its the absence of a negative. This entire decade the building up of regulation is done. Judge, when we saw what was happening in wells fargo and some of the members of our panel mocked me for wells fargo and i said you buy this thing, you close your eyes and buy this thing. Its up 12 . Blood was in the street. I said, everybody always says, Warren Buffett says buy when theres blood in the street. I guess today would be a day youd sell some of these then because there is clearly greed in some of these names. But to mikes point, you look at a bank like wells fargo, unless we were in the same regime and the same sort of scenario where youre seeing 10 billion, 14 billion fines rested out of these banks and the shareholders, by the way, instead youre seeing a regime that might be much more friendly to them, judge. Thats why youre seeing these moves. By the he way, that stock, wells fargo, is up over 6 today on massive turnover. What about this notion that we whether we are or are not getting ahead of ourselves. We might be in the financial sector. The moves were talking about the big picture is one thing. In the short term. In the stock moves themselves. These are big moves. Take a look. Im sure the producer can pull up citigroup. This is a huge move off the february low and over the last week. I want to talk to mike about this. It could be justified if, in your paradigm shift that theres a structural change afoot, these companies that have been in the penalty box are going back it to being valued on book value. You have a bank of america, 77 of book value, you have citigroup, even in the insurance space, met life below book v value. Does it ever come to a point, and is this that point where people say why dont i buy a dollars worth of value for 80 cents . I couldnt disagree more with the one statement that banks have overreacted. Im not talking about days or weeks. Im talking over the next couple of years. Compare to precrisis banks have more capital, more liquidity, stronger Balance Sheets. Balance streets are the strong est in a generation yet you look at the price to earnings multiple. Does it go to a premium of book value on those companies that are below. That would seem to be based on your argument an obvious call to make. Well, relative to the Risk Reduction thats taking place, we think theyre trading significantly below the historical price to book values so theyre still trading below average when they have above average Balance Sheets and we think above average prospects compared to where theyve been the last three years. Thanks for coming in. Thanks for having me. Can we keep the lebron bring another bobble head next time. That one is getting tired. Steph curry. Ever heard of him . Lebron james, its working. Jpmorgan at an all time high here. The biotech bounce coming up, the second tosh posting its best day since 08. One fund manager, however, says that rally will not last. Hell tell us why coming up. Plus, macys and kohls are rallying on the back of strong earnings. The retail trade in the blitz. Is it because so many go after it the same way . Chasing after short term returns. Instead if getting caught up with the crowd, the Investment Managers at pgim take a long term view, teaming specialized active investing with riskmanagement rigor, to seek out global opportunities. We manage over a trillion dollars this way, attracting many of the worlds leading investors. Partner with pgim. The Global Investment management businesses of prudential were drowning in information. Where, in all of this, is the stuff that matters . The stakes are so high, your finances, your future. How do you solve this . You dont. You partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. Morgan stanley. Welcome back to the Halftime Report. Shares of ibm are rallying, almost 3 . Bank of america upgrades that stock to a buy. Jimmy . Yeah. A lot of techs rolling over . Listen, i dont think youre going to lose money by buying ibm. I think youre a ways away from making money. The revenues keep going down. I read the analyst report. Theyre calling for a turn in 2017 but in my opinion why not wait to see that turn because you know what weve been waiting for three years to see the turn in revenue. Theres no way to really say that their core business has stopped declining enough that their really good businesses including watson, Cloud Computing and big data will take over. Just wait. Youre not going to miss anything. Here is what cramer said. When i think of ibm, i think of negative revisions. When you google negative revisions and google comes up, maybe thats over. Any other takers . Why wouldnt you just wait and see until the turn occurs is it and auer getting a big selloff in technology so there are other opportunities in the sector. Youre getting apple on the cheap, microsoft, cisco. What about the fact what does the rising rate story potentially do to buybacks and stocks that are heavily reliant on buybacks . I think more importantly the tax reform and the repatriation and some of those aspects as well, scott. I look at some of the companies when you talk about the trillions of dollars that are overseas that could be a game changer and could be great for the economy here in the u. S. I think when you look at this call on ibm it makes sense theyre starting to turn the corner but the reality is i would rather be in the names and thats why i would be on the pause button with jimmy, the names already in the midst of a very strong transition. Microsoft, cisco, intel it. Those names are transitioning rapidly into growth. Ibm is still slugging along. They have growth but theyre really just slugging along right now. Yes, they have cash flows and so forth. Its just not the same as microsoft. I would rather buy sales force on 3. 5 decline, much rather with benioff. Even though buffett has been patient with this one, scott, at some point you dont have a day like today, somebody like buffett is going to lose patience and this one hes still 36 under water on this trade. 12 30 or just there about on the east coast, where markets share now. Its been an interesting day on wall street. The dow is at the highs of the day. The industrial stocks, the banks are helping the dow. 18,752, a gain of 160 points. S p up by a point. Its the nasdaq thats been a really big story today. Thats where the roll over really happened early on. Nasdaqs at 5187 but a loss of 63 points amounting to more than 1 . Nearly 1. 25 for that pullback in techled nasdaq today. The latest headlines. Here is whats happening this hour. The prime ministers of russia and israel pledging to join forces to tackle radical islam telling Benjamin Netanyahu that terrorism threats are real in a unique way adding russia also suffers from terror. Dozens of protesters attempt to go block off the entrance to the European Union headquarters in brussels where the annual European DefenseAgency Conference was taking place, the accuse the eu of subsidizing the weapons trade. Mitsubishi is recalling two suv models to fix problems that could cause the windshield wipers to malfunction. The recall covers 100,000 outlanders from 2007 to 2013 and 95,000 outlander sport vehicles from model years 2011 to 2015. Thousands of trucks arriving to fill up a massive sinkhole in japan. Workers rushing to fill the gaping hole that appeared suddenly earlier in the week devoured a fivelane intersection in the center of the city. Your cnbc news update. Back over to you. Sinkholes are one of my biggest nightmares. It could happen anywhere anytime. You have to be ready. Courtney, thanks. The one commodity that may have predicted a trump victory. Plus, one tech stock up 85 over the past six months and the Options Market is betting that rally is just getting started. Our man pete has that trade just ahead and as we head to break take a look at the heat map. We said the banks are doing well, yes, they are. Jpmorgan. Health care continues to do well. Fizer is up. Theres ibm. Were back. Guys, whats happening here . Hey nicole, this is my new alert system for whenever anything happens in the market. Kids a natural. But thinkorswim already lets you create custom alerts for all the things that are important to you. Shhh. Alerts on anything at all . Not only that, you can act on that opportunity with just one tap right from the alert. Wow, i guess we dont need the kid anymore. Custom alerts on thinkorswim. Only at td ameritrade. Will your business be ready when growth presents itself . American express open cards can help you take on a new job, or fill a big order or expand your office and take on whatever comes next. Find out how American Express cards and services can help prepare you for growth at open. Com. We want to remind you maybe not the last time in the show but Jeffrey Gundlach will be with us of doubleline capital, the bond king, maybe the election king. He called the election, too. But we cannot wait until 12 40 p. M. Eastern time tomorrow ex clues ive interview with Jeffrey Gundlach, get his take that donald trump was elected as he thought would happen, where rates go because they have been backing up, where the markets at large could go as well. We look forward to that tomorrow. Health care is higher again today. Biotechs coming off its best day since 08 following Donald Trumps surprise victory. We are joined by Health Care Portfolio manager at esquared. Thanks for coming in. This has been ripping since trump was elected. Does it continue . It depends what sector. Sorry to give you a nuanced answer. I think biotech runs into a headwind because a small mid because of higher Interest Rates. But pharma continues to go up because of repatriation and lots of other good stuff happening to pharma. Do you go individual names . If you say small to mid . We tend to when we are negative not to name names. On the pos it tiff sidpositive side, united health, big insurer. You dont like to upset people. We dont like to hurt peoples feelings. Do it. No, were on television. Again, we would use this as an excuse to trim in it biotech, using some of the options. Like the ibb, for example yeah. Our preference is xbi because it captures the smaller and mid. Okay. I think youll get a chance to buy them again in the spring. You would fade the rally . Fadely. Theyre going to come back in the spring. Youll get your chance in the first quarter. You said fade the rally. Are there names you would say, you know what, all the biotechs are not all the same so what names still have plenty of upside . One that jumps out that we are sniffing around to build a bigger position is gilead. Lots of cash. Though they havent made an acquisition . Its great that they havent made an acquisition because valuations have come in. But their valuations come in as well. Theyll be able to repatriate like a zillion dollars of cash if trump does what he says hes going to do. I think next year a good year for them. They have the ingredients there. Were just looking for the recipe. When you look at pharma and biotech, people were saying if you did get clinton it would be like 92 and stocks rallied hard from there. But you go back to the 90s and had big drugs coming out, viagra, vioxx, lipitor, theres no blockbuster come out. The only space that seems to have growth is oncology which is very crowded, alzheimers has been a swamp for anyone who has gone there. Do you see any real signs of growth, new products that will change the world . Changing the world immediately, no. To your point about oncology, weve had a revolution in immunology totally crowded. I agree with you. Were getting smarter about it. I think particularly there are some private companies coming public that youll see interesting drugs. Mid stage not late stage which is where you change the world. Do you do medical devices, too . I do. What do you think about that space . We own a number of small they will probably be used as a source of funds going into the end of year because they have had such a fabulous return this year. In the long run theyre not affected by obamacare so they should do better and the valuations arent terrible. Did i tee you up or what . Thats the strategy i have had so far this year. I sold stryker yesterday. I still own tmo, perkin elmer i believe reports this week im not sure if you cover that or own it thats a name i think pki would do well. I agree. You have to think about long term. I think this quarter will be choppy for the stocks. Valuation is good. No obamacare exposure or lack thereof. New product cycles almost always work. Thank you for coming in. I appreciate it. The brothers najarian are following the unusual ak it tift in the Options Market as they always do. The bullish moves they are seeing in two tech stocks up next. First, though, Tyler Mathison has a look at whats coming up on power. Coming up at the top of the hour on power i hope youll join us stocks are rallying again. There goes my mike. Just wait a minute, everybody. [ applause ] big cap tech like amazon getting battered. What to do with this group post election, folks. Jpmorgans dimon considered for treasury secretary by the trump team. Would he take the job . What a Trump Administration would look like. In the market for a new home . Why now could be the last chance to lock in a low rate. The Halftime Report is back after this. And it will be a lot smoother. Im only in my 60s. Ive got a nice long life ahead. Big plans. 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And which aarp Medicare Supplement plan might be best for you. Theres a wide range to choose from. We love to travel and theres so much more to see. So we found a plan that can travel with us. Anywhere in the country. [ male announcer ] join the millions of people who have already enrolled in the only Medicare Supplement insurance plans endorsed by aarp, an Organization Serving the needs of people 50 and over for generations. Remember, all Medicare Supplement insurance plans help cover what medicare doesnt pay. And could save you in outofpocket medical costs. Call now to request your free decision guide. And learn more about the kinds of plans that will be here for you now and down the road. I have a lifetime of experience. So i know how important that is. Welcome back to the Halftime Report. I want to take a look at copper. It is surging to its highest level since july of 2015. Cnbcs Jackie Deangelis with the futures now traders. Good afternoon to you, scott. Big moves in copper since we found out the results from the election. A Trump Administration would spend more on infrastructure. Do you think copper could continue to climb high er from here even though its made a dramatic move . 16month high. 4 each so i think there is an exaggeration. Theres a long time between now and january 20th. It may be overdone short term. What are the levels we should be watching in the copper trade . Copper had strength before the election. I think now that its broken out of this longterm down trend. Well talk more about the markets post election. We have sven henrich. Thank you so much. Something unusual happening in chip stocks today. Jon and pete. This is a stock thats been on a nice move. From the low end way down here in the middle of summer up to where it is now. I think were seeing a january 37 call being bought. The volume on the day is about normal but that volume puts it into a 501 trading versus puts right now so very aggressive on the call side. A lot of buying, scott. Can it break through to the upside . We had rich on this show actually just a couple of weeks ago talking about that stock, talking about the margins. I think its going higher. I have a chip equipment maker. Applied materials, judge. Its trading down today like pete says about 3 . So what do they do . People were coming in buying the 27 calls, not selling them. Buying the 27 calls but way out in april, judge. So what did i do . I bought the 27 calls along with them and sold 30 against. I got this one probably for a month or more, judge. I like the upside from here. It tests 3107. We see if we break through early. Id like to get comments from you on tech and where we started the show, and techs in general or not. Well, yes, but it depend on which area. Something like micron which had a very big rally i think is a good place to take profits. Qualcomm got downgraded by Morgan Stanley and its well off its 52week high. So really whether its the chips or the tech sector, there are plenty of stocks to sell. That money can come back again because technology to draw the mopey out. It was exactly what nelson pelts said on the show yesterday and you talked about it before. The market is treating him seriously, however. I thought those were great words to categorize. Let me stop you here. Video now of this meeting today between president elect donald trump and president obama. They talked about a wide range of issues. Some of the organizational issues in setting up the white house, we talked about foreign policy, we talked about and, as i said last night my number one priority in the coming two months is to try to facilitate a transition that ensures our president elect is successful. And i have been very encouraged by the interest in president elect trumps wanting to work with my team around many of the issues that this great country faces. And i believe that it is important for all of us regardless of party and regardless of political presences to come together, work together, and deal with the many challenges we face. Michelle has had a chance to greet the incoming lady. We had an excellent conversation with her. We want them to feel welcome as they prepare to make this transition. Most of all i want to emphasize to you as president elect we now are going to want to do everything we can to help you succeed because if you succeed them the country succeeds. Thank you very much, president obama. This would last 1015 minutes. We had never met each other. It could have gone in for a lot longer. We really discussed a lot of different situations, some wonderful and some difficulties. I look forward to dealing with the president in the future including council. Some of great things have been achieved. It was a great honor being with you and i look forward to being with you many more times in the future. Thank you, sir. Thank you, everybody. We are not going to be taking any questions. Thank you, guys. Thank you. Its always the last one. Come on, guys. All right. That is the president of the United States, the president elect of the United States, donald trump. Their very first meeting, Donald Trumps trip to the white house. John, this is what our democracy is all about, of course. Awkward for sure, but i think the country watching that tape has got to be reassured by how that meeting between president obama and president elect trump. There was no anchor. Its striking as they indicated that this was their first meeting. They had a troubled history with the birther issue, donald trump questioning his legitimacy. That shows you the strength right there of the constitutional system. That president obama is in keeping with it and donald trump is in the same spirit. We hope the next two months go as smoothly as this morning did. It really understand scores why the market stage they did after election day which became election morning and continued today, a sense of calm, maybe even relief among investors that some of the things we heard from donald trump on the campaign trail may not be the same types of things we either hear or that he does in the oval office. Reporter that is completely true. We dont know. Again, you and i have discussed this before. Given the many things that donald trump has said about issues on one side or the other side either in the campaign or over the years, we dont know what he values most, what hes going to prioritize, and so i think there is some relief at the idea that the things that are feared the most may not materialize. I think theres relief that the rancor of the campaign has gi n givenwgiven way to this moment. And the smoothness of this moment. Make no mistake, its going to be very difficult. This is a president elect that is going to undo what the current president values the most. Nen nevertheless, i think president obama may seem to influence it and if he doesnt, in ways thats very important to the success of the United States. John, thanks. John harwood on the north lawn of the white house. Were back with this with final trades from the gang. Opportunities arent always obvious. Sometimes they just drop in. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. On a perfect car, then smash it into a tree. Your Insurance Company raises your rates. Maybe you shouldve done more research on them. For drivers with accident forgiveness, Liberty Mutual wont raise your rates due to your first accident. And if you do have an accident, our claims centers are available to assist you 24 7. Call for a free quote today. Liberty stands with you™. 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We are all in for our customers. Is happening before our eyes. Shift in Human History sixty to seventy Million People are moving to cities every year. At pgim we help investors see the implications of long term megatrends like the prime time of urban expansion, pinpointing opportunities to capture alpha in real estate, infrastructure and emerging markets. Partner with pgim the Global Investment management businesses of prudential. All right. Welcome back. I want to show you the market. You can call it a trump rally. Dow is up 195 points. And, guys, that clearly is what this is. This is the trump rally. Whether youre talking about taxes or repatriation. Theres no doubt about it, scott. You look at whats leading. Financials, health care. Things under possibility police clinton. All of a sudden youve got trump. Look at what the banks are doing, industrial stocks, the higher growth areas. If you think theres going to be a large infrastructure trade, focus, energy is in focus. Oils are down. You talk about areas that people seem to be perhaps more optimistic about, joe. I also think a lot of it is people getting turned around. There was a lot of short selling in the overnight markets obviously on tuesday evening. I think yesterday people sold in to the rally. I think they thought they would get a pullback. The market continues to move up. Sectors that were very strong yesterday and people were talking about selling, youre seeing people come in and buying those sectors today. Remember they thought the market was going to go up no matter who won. Earnings were improving, the economy was improving, and maybe thats being borne out now. Maybe people thought Hillary Clintons election was going to be the thing that set the markets in motion. Maybe people missed the fact that donald trump and the policies he put in place would be a positive for the stockmarket. If thats the case, theres one sector. More than their earnings, their prognostication Going Forward is that growth is picking up. Consumption is at 17 gdp. That would be very positive for the u. S. Company. The srt, which were talking about hehere. No doubt. Good stuff. Thanks for watching. Power lunch begins now. Welcome to power lunch. Heres whats on the rally. Youve got financials flying while technology tanks. Were going to find out why and why you should be investing in this new political world. Plus donald trump says hes pro oil, but does that make oil stocks an automatic buy or maybe an automatic sell . Hmm. Listen up all you homeowners and buyers. Right now could be the last chance to lock in the low mortgage rates, so sign the check. A busy power lunch starts right now