If you think back february 1st, 2006, then president bush talked about america being addicted to oil. We talked about the possibilities for energy independence. 2013, we now export more than we import. Why . Its all about u. S. Shale production. Its about fracking, it is about something that is never going to reverse itself and change, scott. Theres a tremendous amount of domestic oil here. Nonopec production is really not in compliance right now. Were not surprised by this at all. And it was telegraphed at the beginning of the year in the Energy Equity markets. Does it bleed through and impact equities, themselves . Yes, it does, if you get below 40. But i think in the 40s, were okay. Boy, steve, we were just talking not that long ago, wondering if it was go maybe to 60. The head of saudi aramco over in houston with Brian Sullivan this week saying that the worst was over. I asked you yesterday, pointblank, if oil does drop below 50, do we have a problem for stocks. Now that it has, what do you say . No. And ill tell you why. If you recall back to when oil was dropping, the big concerns were that its partly economically driven. That theres less demand because the economy is shrinking, not growing. Here we are in the u. S. , at least, draghi may have doubts about europe. But in the u. S. , i think you would have to be living in a cave for the last six months or year to believe that the u. S. Economy is not improving. So finally well get it, that theres no correlation or the correlation hasdy integra disin almost to nothing for economic demand and demand for oil. Thats why i think were okay. To the extent it could pressure s p earnings, thats something different. But weve seen that already. If you take the multiples out of the big oil companies, you actually have a higher pe in the s p. I think were okay. We point to all of these potential warning signs, jim. And we put them on our wall the other day, and its always something you dont anticipate that pops up that makes you reconsider sort of where we are. We said, well, youve got to keep your eye on fed hikes. Youve got to keep your eye on the rising dollar and rising rates and the trump agenda, maybe being slower than the markets willing to accept. And here we are today, talking about oil in the 40s again. Yeah, but i think were all saying that its not a worry. Youre right, its always the thing we dont kexpect. Its not oil for all the reasons we talked about. And i want to emphasize what joe said about this not being a surprise. If you followed the rig count, that bottomed eight months ago. This is an absolutely delayed response that you could see coming. So, oil, i think this is very much a positive. Obviously, its negative on profits in the oil patch, but its very positive for consumption here in the u. S. , that were not spending as much on what about i will disagree for a second. My comments at the beginning, its its a problem if it goes below 40. But what i tell you i agree. But what i will tell you, i think thats where its possibly headed. So, yes, it is we talked about this the other day. What eventually will correct the market is the unknown that no one can really hedge against. The trump policies, the things of economic growth. Everyone, all Money Managers know about that and they have the ability to try to hedge around that. But oil comes out of left field right now, and i dont see it going back up north. Im just saying, talk about some of these names. Just this week alone, right, we havent been talking about these kind of losses, at least as i can remember, in a while. Transocean is down 11. 5 this week . Its not even the end of the week yet. Murphy down 9, newfield, 8, hess, 7, nobel, 7, devan, 7. Lets see if the unintended consequences of the banking sector. Last year you had the banks selling off because credit was going to get worse. I believe if oil starts going down below 40, we could have that. We could also have the selloff from the middle east if they need money in equities. I think the band of 40 to 60 still works. When it goes below weve seen this story last year so we can be prepared for it. Jackie deangelis covers the oil market for us. I want to know what shes hearing from traders shes talking to. Jackie, whats the word on the street about how low traders think oil can go . Hi, scott. That testing of 50 yesterday was really key here. Everyone was telling me that wed make another run for it. And indeed, today, we did. The session low near 48, 50 so far. But we havent seen under 50 since december. So what happens now . Well, it may not be a linear path, but there is pressure to the downside. U. S. Inventories have been building up. U. S. Production is going up, over 9 Million Barrels a day. Its now just slightly off its peak around 9. 6. That opec deal that you mentioned, certainly providing some support here. But no grruarantees that its going to be suspended. The specs were very long in this trade. Theyre going to have to turn that around. Sometimes it takes a little time. In terms of the stocks, two weeks ago we looked at the xle and wti. They were diverging. The xle, lower yeartodate, tends to be the better indicator. Now theyre going the same way. The bottom line is, traders are saying we could see a dip to the mi mid40s, but that could present buying opportunities for both the stocks and the futures. You said it, the saudis have an ipo coming and a vested interest in keeping this price supported. It would be very good for them with the efforts that theyve made so far to continue that pattern. Back to you, scott. Jackie, thanks so muff. John kilduff is here as well, the again capital founder, cnbc contributor follows this market as close as anybody. What do you think, watching all of this . We were set up for it, scott. I think that the battle lines were drawn in a fairly narrow range between about 52 and 55 on the upside for the past several months. As jackie just referenced, we got into record length territory by speculative interests in this market and they couldnt push it up. They tried and tried and tried and it didnt happen. Yesterday, big volume spike. Big down volume is confirmtory to me that theyve thrown in the towel and were in the process of a pretty big long liquidation at the moment that should carry us all the way down, i think, to the november lows of 42. Well retrace the entirety of the rally from november to just recently. But you dont think we go below 40, as joe suggests, at least he thinks we might . We could. I think, i think the you know, one step at a time here, as me targeting 42. But certainly, as has been referenced already, the rising rate count, the fact that commercial companies here in the u. S. Have hedged aggressively over the past several months. That was the other factor. Everybody was focusing on long speculatives interest in this market. Also one of the biggest short commercial positions in this market, because they have all took advantage of the rise above 50, to lock in their cash flows going forward. So now opec and the nonopec adherence to the dealer was cut, have a big problem on their hands. These guys arent going away as quickly this time. We need to worry again about, are we going to be asking questions about Bank Exposure and all of that . Not the same. Before high yield and all of those questions, which was weighing heavily on the minds of investors . I dont believe we will, judge, for the reasons that the irr from these companies are able to make those rates of return down around the 40 level that joe and john have spoken to already. Theyre still able to make that, whereas in the past, they needed more like 75, 80 to make that. Thats how much its come down for the permian, for any of the shale production areas. Whether its, you know, the sands that go into it, whether its the chemicals and so forth, whether its just the bidding for men and women to work there. Its not as ononnerus as it was. This will be a catalyst for that, for that m a the efficiencies that have been achieved have been remarkable. And theres a slack in the labor market. We got lucky on the debt side last year. We did not have a significant amount of energy debt that was maturing in 2016. So we caught a break in the environment that we were in. The Debt Maturity avalanche, so to speak, i believe, will be the beginning of 2018. So oil prices 40, and augus august september, you then to need consider what john is talking about on the high yield side. Lets take it a step further. If you get, you know, a rate hike next week, as oil is approaching, you know, the 42 or even maybe 45 whatever. Fit looks like its in that nearterm down trend, at the same time, the fed is hiking rates. Is that an issue . Are you worried about economy slowing is as a result of all of this . Because im worried about the impact on the market. If you are, i think were placing too much belief that the fed is going to dogmatically going to do something. As to the idea its going to raise two, three, four times this year. If the economy begins to falter, as a result of oil or something else, they will stop. They have no interest in killing this economic expansion. My only suggestion is, if youre already wondering how the market is really going to react to a rate hike, ill be it 25 basis points is not going to be the end of the world and weve suggested and others have as well that the market can handle it. But, you know, if youre watching with one eye what oil is doing and now youve got to worry about rates going thats a good point. I think the problem becomes, weve come you have the earnings recession and you bring yourself into a situation where maybe this is a dead cat bounce in terms of the earnings. Heres the good news about it, okay . The good news is that were only a year removed from the bottom. Maybe a year and a month from the bottom of oil. We went through that armageddon, and guess what, we survived. Its not like this group of investors dont have that perspective of something that happened 10 to 15 years ago. I think theyre okay with it. It was amazing to me how we didnt see massive bankruptcies, we saw some of them, but the high yield markets were there, the credit markets were there, to bail these companies out, theyll do it again. Theres still so much cash in private equities. And the banks have cut them a little bit of a break. They lowered their standards at the time to give them a pass and get them through what looked like a cyclical low. They could do that again. And janet yellen did site low oil prices as a reason to hold back. I would be more worried if i were saudi arabia and but what if i do if i own the exxons and chevrons and Companies Like that . Theyre actually in a good position, because theyre seeing the smaller competitors go away. They have been focusing their capex in the shale plays. Theyre just going to get bigger in there. This is actually a Good Opportunity for them to gain some market share. John, i dont know if you disagree with that, but i would love to hear your thoughts on it. I think the certainly, the new hess, for example, they have a big problem on their hands, because theyre going to struggle with this pure oil play that theyve cornered themselves into. You talk about the refiners. Thats a bright spot this year. The biggest fear the oil industry has to worry about, the most effective strategy out there that the saudis can employ is to flood the market with oil. Thats whats worked the best for them over the years, because that really calls the highcost producers. Not what theyre doing right now. Im sorry, im glad you mentioned the refiners. Its certainly an area that weve talked about in a long time, but not for a while. We havent talked about the valeros and the 66 and some of the other names you just saw on your screen. What do you do with those stocks . I own them. I think this is, again, the time now when oil goes down, its easier for them to make more money, volume comes in, you want to own these stocks. They have really good Balance Sheet s now and good dividends that have been increasing. If youre going to buy them, buy them at this time. I think sirotts vision is longer than mine has been. I think in the energy trade, you cannot mary a position. Its something that we wanted and desired and its here. And now we have to learn how in terms of asset pricing to deal with it, because its not going away and its going to create environments where youre going to see like we saw yesterday the tremendous build until inventories. Its a classic commodity trade, right . Commodities by design are supply and demand. The other issue, scott, that you mentioned, with rates rising, guess what, our dollar will get stronger. Commodities all sold in dollars. All of a sudden, maybe the market is discounting that ahead of a rate hike and probably saying, look, this is what we think is going to happen. The question is, you might see the debt count bounce. So on refiners, i still own petroleum. Im starting to wonder. There seems to be a systemic change in the valuation. These used to be singlevaluations. Now into the multiple digits. And its all because of this mlp dropdown phenomenon that was going on. Im not sure that i believe that that fundamentally changes the way youre supposed to value this very cyclical business. I like it because its hard to build a new refinery, but i think we have to be careful with the refinery. And if i think if oil goes down, i think youre right. The time is, they were supposed to do something when it all goes down. They didnt do it. Youve got thesis creep. Either way, what yesterdays Information Regarding Oil emphasized is that the rails continue to be a great opportunity, because thats how domestically is going to be transported, 2014, i think over a tenyear periods, car loads were up 100fold. Thats not going to change with all the oil we have in this country. John, if i can ask you a quick one, regarding the not just switchover to different grades of gasoline and diesel that come out, but a lot of the cleanup thats going on right now with the refineries, this is the season for it. Is that behind part of this surprising big build we saw . Yes, weve had a very strong refinery maintenance season where they retool to make the summer grade gasoline and diesel fuel youre referring to. That has helped build up inventories but its seasonal. It happens every year. Thats right. It is bigger . What eweve been watching, too, there has been consumer resistance to even this mod test price rise at the pump thats occurred over the past six to eight months. That could also benefit the refiners to the extent these pump prices come down. You miss that . Its been a head scratcher for me because employment has been so strong. Even Goldman Sachs came out and said the kind of numbers we were seeing were recessionary in terms of the drop in gasoline demand. So this could revive that part of the business once again if we get a price drop. We havent at all mentioned natural gas today, which was up 5 in the week. As oil was down, you know, 6 plus, gnnat gas getting a pop. A little bit of a cold spell in the month of march, i wouldnt get too excited about it. Its approaching 3 again. Again, theres a tremendous amount of supply. Endless supply. I actually like it now, joe, to be honest with you. Because the use intensity of gas, when we get a cold snap or summertype cooling demand, were using a lot more gas to satisfy the cooling or heating demand needs. So i think for the first time for me in a long time, im actually constructive on the commodity. I think we could have had boom in it this summer. You cant ignore the export that continues to pick up and they continue to put more trains online down to savion pass. The demand is going up internationally for u. S. Gas. And were also piping more of it to mexico and canada. Theres a pretty good story there for the first time in a while there in my view. Well leave it there. John, thanks. Our thanks to Jackie Deangelis today, as well. Heres what else is coming up on the Halftime Report. The number one analyst on apple takes up a new pursuit. Covering tesla. See what tony thinks about this stock. And in the next hour, the ceo of shell, ben van beurden. The Halftime Report with scott wapner is back in two minutes. B. I love that i can pass the membership to my children. Were the williams family, and were usaa members for life. Tomorrows jobs report, our partners at kensho showing an afterjobs report above consensus in a rate hike cycle. Boeing is the rate hike leader one week later, up 2. 5 . Caterpillar and United Technologies also do well, while the dow is up just zero point 15 . Now back to scott wapner and the halftime traders. Welcome back. Toprated apple analyst tony sag nknack sacconaghi saying hes bullish on the companys longterm potential, there are some nearterm concerns. Weve made it our call of the day. Toni live back with us today from new york. Its good to talk with you on something other than apple for a change. Thanks for having me, scott. You offer what is a more sober view than sycophantic view of tesla, arguing the stock right here is fairly valued. Why . Well, were torn. On the one hand, we are pretty bullish on the adoption of electric vehicles going forward. On the other hand, our valuation metrics suggest that the stock is pretty fairly valued. And in fact, is discounting that tesla will become bmw over time and that you have to believe a lot more, either much higher margins or much higher market share than a bmw or mercedes to really justify the stock. In the nearterm, we have a series of concerns, as well, as it ramps model 3, which im happy to go into. Yeah, i mean, you do admit, i mean, your gross margin estimates, and people feel margins closely in this story, are well below the streets forecast. Correct. So were worried about Gross Margins over the next one to two years, really, for two reasons. One, tesla has struggled to have healthy Gross Margins on the models and modelx today, and they sell for about 100,000 on average. The model 3 is expected to have a base price of about 35 and an all allin price of 42 or 43. So the required cost down to have marpg margins that are come is really significant and were not sure tesla can do it that quickly. Thats the first concern. The second one is, theres a tremendous ramp that needs to happen. Tesla will probably spend 3. 5 to 4 billion in capex. Thats going to start depreciating, which hits Gross Margins as well. And so the combination of those two factors is what puts us below expectations. When does a Capital Raise come . And what do you think the impact will be on the stock . Were expecting that a Capital Raise would likely occur between the second and Fourth Quarter of this year. I dont think it will be significant. They might need to raise 2 billion to 3 billion. But tesla did that last year. They did it with equity. They have credit lines that they could tap into. And they did it without a major impact on the stock. I think its reasonably well understood that theyll likely have to go back to the capital markets. I want to ask you, you know, how do you, as an analyst, sort of quantify what, in many ways, could be unquantifiable . And thats the cult status around this name. How does that factor into the way you view this stock and whether you think that puts any sort of a floor underneath it . Right, its a great question. Im not sure i have a great answer. What we try what we teslas a very emotional stock. It has 25 of the shares are held short, which is really an astounding number. And you have very, very strong bull sentiment, as well. And so i think what we tried to bring was a very factbased perspective to tesla, without a preconceived sort of longer term vision that this is going to be great or this is going to be tough. And the facts that we looked at were, we tried to look at what stocks trade at, that have similar growth rates to tesla. And when we applied those kinds of multiples for companies that had similar growth rates and similar margin profiles, we came up with a valuation that was pretty close to within striking range. And what we tried to do is say, lets envision the end state, in 2050. And what might tesla look like . And again, thats where we tried to think about, could they be as big as bmw . And if they were, what would they be worth . And if they were more profitable than bmw or larger than bmw, what might they be worth . Thats what we tried to do . Do you think the deal with solar city makes sense . Were you skeptical about it . And if so, are you still, as you really sort of dove into what you think it could mean. Well, you know, solar city adds incremental risk. This is a company that has been growing very quickly, but also been growing by raising debt, so that it could finance panels to sell to consumers. And so, teslas already in a cash usage situation. Negative cash flow. Theyve burned about 6 billion of cash since theyve been a public company. And so you add solar city and that adds an incremental degree of risk. The longterm vision ultimately is compelling, which is that tesla wants to build an integrated environmentally friendly home, where youll have tesla solar panels, youll have Tesla Energy Storage that will capture that, the energy from that storage and it will charge your car. And you can return that energy back to the grid. Thats a compelling vision. But, again, in the near term, the distraction of having another business and the distraction of having another business that will likely continue to use cash is certainly an incremental kanlg to tesla. Tony, john najarian. Quickly, you mentioned also, i was going to ask about the solar city part, but you just addressed that, so what about the batteries themselves . You say theyre somewhere between 25 to 30 cheaper for tesla than they are for the other manufacturers, which makes sense, because, of course, theyre making a heck of a lot more of those and producing more electric cars than any of the competition, perhaps, than all of the competition put together. At point does that edge begin to erode . In other words, are these other guys gearing up for that fight, or where are they getting their sourcing for their batteries . We know where teslas doing it . Right, right. So its a great question. If the nearterm, we do believe that tesla has a battery cost advantage, versus most peer. Byd, which is a chinesely integrated car and battery manufacturing company, we think has battery costs that are close to teslas. Its hard to know exactly. But close to teslas. And theyre big and theyre vertically integrated, as well. I think over time, theres the debate about tesla, which uses a small cell battery. Whether that will ultimately, structurally could be the lowest cost, i think most battery experts would guest that larger, prismatic batteries, which is what almost every other Battery Manufacturer makes, so the lg cams, the byds of the world. That those ultimately in the longterm will have a superior cost advantage. For now, tesla, we think, has the lowest cost battery. Byd is probably very close. And thats enabling them to produce a car like the model 3 at 35,000. And thats helping to create what we think is a pretty powerful brand and first mover advantage. The question, ultimately, is, can they sustain that. And obviously, if they have any issues ramping the model 3, you know, that could really undermine their credibility and their brand. So thats how i think about it. Look, tony, ive got to run, but this is a company that has overpromised and underdelivered on numerous occasions when it comes to deliveries in the past. And you clearly have that in mind, to some respect. Absolutely. I think the street has increasingly discounted that. I think if you interpolate between their statements about how many cars theyre going to deliver in 17 or 18 or what the production rates are going to be, you know, theyre pointing to maybe 130 or 140,000 cars this year, in 17. The street said about 110. And next year they might be pointing to 75 to 400. The streets at around 300. So clearly, investors recognize that pattern and have set expectations somewhat accordingly. Enjoyed the conversation, as always, toni, thanks so much. My pleasure. Toni sacconaghi. No one owns the stock. No. Weve owned it from roughly december, middecember when a bunch, two of our analysts were really fighting and thats where jim and i have had our disagreement about, they said the advantage they have, not having the legacy costs of the other carmakers, was such a huge edge, that at 180 bucks a share or whatever, they thought it was a steal. They were right, but i didnt write it all the way up to where it got to this recent run. I dont think this stocks been a steal forever. Its always been overvalued. On a relative basis to what the historic multiple is for the relatively short history, maybe it was a steal. But to me, this is not much different well, it is somewhat different than gold, because they have some intrinsic value. But i think its too expensive. It will take years to grow into it. I think its about the battery for this company. And it have sho26 short inter tough to bet against with the stock at 225. But its about the batteries, can they make better batteries, can they get penetration beyond what theyre seeing now, which is selling so many cars in warm weather environments. Can they sell in cold weather environments. Take that same battery in california and bring it here to new york, that battery life is significantly different. Almost half. I just think its no mans land. Dont short it, dont buy it. Just talk about it. Lets talk oil. With oil prices falling, are airlines a good buy right now . Were going to see whats happening to the group after big drops for crude in the past. First, the most actively traded stocks on the New York Stock Exchange right now. There they are, lead by bank of america, top of the list. Valuee at the bottom. Back on halftime right after this. This. All right. Weve sent the doctor over to the telestraiter. Doc, what are you seeing . Hartford, judge. This insurance company, big unusual activity and some m a chatter about the name. So not surprising to see a big spike in the options. As you can see, stocks up about 70 or 80 . Its already made a little bit of a move today, but the options, huge move. Take a look at these, judd. The 49strike calls. Hows that. This is just a huge surge of buying in these calls. This is not dollar value, by the way. These are the number of contracts that have traded. But nonetheless, to see the that many trade, that quickly. This doesnt normally get that sort of activity. As you can see, the stock was pretty close to unchanged, to down early in the morning and now has had this spike and people are looking for big upside in the very shortterm, but then they just stepped up and bought april 55s, too, so watch it to go higher. We like when you trade the options, doc. There you go. Do you have any free books left . Ive got lots of free books. Got new commercials running right now. Do you . Yeah. Come on back over and well talk more about that. Sue herrera has the latest headlines. Maybe sue needs a book, too. I could always use one of johns books. Thank you, scottie. Heres whats happening at this hour, everybody. Russian president Vladimir Putin hosting israeli Prime MinisterBenjamin Netanyahu for talks on syria and israels concerns about the role of iran in israel. Netanyahu praised russias role in fighting isis. China defending its handling of 38 trademarks it recently approved for president trump, saying it followed the law in processing those applications, which some experts viewed as unusually quick. Trump has struggled sometimes with trademarks from china. Gerber has issued an egg allergy alert for one of its products. It includes all packages of his cheese ravoli pasta pickups. Only customers with a sensitive or allergy to egg are at risk. And a later blooming period for todays Cherry Blossom season because of below average temperatures forecast for the weekend. Last week, peak bloom will take place between the 19th and 21nd. Make your travel plans. Its beautiful. Now down to Brian Sullivan for whats coming up on power lunch. Hes in houston. Hey, brian. Yeah, were going to put the lunch back in power lunch. Were here at grotto in houston. Hes going to join us the entire two hours. This is a big news day and we have got you covered with an amazing guest lineup. Big ban berden will talk about the 48 handle for the price of oil. We have andrew liversy of dow chemical and talk about trumps first hundred days. When will we see policy action really happen . And jcpenney, another texasbased company undergoing another major transformation. Weve got a big show here from houston with tilman fertitta, the 1 billion buyer himself, the entire two hours, from the gotto restaurant downtown. Ill send it to a commercial break and ill see you at the top of power lunch. Of power know you have a dedicated advisor and team who understand where you come from know you can craft an Investment Plan as strong as your values know that together, you can establish a meaningful legacy with the guidance and support of your dedicated pnc wealth management® team. Usaa gives me the and the security just like the marines did. The process through usaa is so effortless, that you feel like youre a part of the family. I love that i can pass the membership to my children. Were the williams family, and were usaa members for life. Welcome back to the Halftime Report. Im seema mody. After a steep drop in oil prices, our partners at kensho say the top performers are in the airline space, five days after the steep drop in oil prices. On the list includes united airlines, up 2. 2 . American airlines, up 2. 31 . Another big winner is delta airlines, also up 2 . Now back to scott wapner. And of course that will be the question, whether lower fuel costs does help profitability of these airline names. Seema, thanks. Well ask an investor right now. American airlines, you get it first in the blitz. Basically whats happening right now in the airlines, delta came out earlier this week and now american. Their revenue per seat is going down. As soon as that turns, and we believe thats the Second Quarter this year youre going to see upside in the airlines. Right now with oil coming down, american is the most unhedged. Its going to hurt them, shortterm, youre probably seeing some pressure. And not lightning up any of the positions you have. I lightened up when they became too big of a portfolio. But heres the opportunity to start buying them again. You dont have an issue here of demand. Its an issue of is supply. And i think thats better for the airlines. Doc, give me something on staples. Theyre committed to 300 million in cost savings, judd, but theyre also seeing about a 7 decline in samestore sales at their stores in north america. Thats not so good. Theyve bounced, though, off of theyve cut the loss in half on the day. Down about 7 , now down 3. 5. But not an exciting stock. Jimmy . Cignsignet, they beat on the bottom. The stocks up almost 8 . But over the long history of at least the last year or two, this is a tale of two companies when you compare it to tiffanys. Two years ago, signet couldnt do anything wrong and tiffany couldnt get out of bed. Thats absolutely reversed in the last year, year and a half. And the reason why is that signet is domestically oriented. Thats been held against them too much. Theyre very cheap right now. And apropos of what were talking about in the u. S. Economy coming back, this is the place to be. All right. Facebook, all the talk this week about snap. Oh, by the way, facebook hits a new alltime high for the second time this week. It did. And there was talk today about facebook launching something. John, you know better than me, a 24hour type of rival to snapchat. I made the comment the other day that i believe, and i said this on tuesday, that social media stocks could be reaching a point where you have to question if they are too high. I stand by what i said the other day, clearly, facebook is the best of the best. Okay . But i think some of these names are ripe for a correction. Anybody want to contest that . Take the other side . Joes lumping facebook in with some and ive owned facebook and i own facebook. And i have not bought it since its now in the 130s. I think the pullback is when i want to pie sobuy some more. But if you look at where snap is and you have instagram and messenger and can go stories on all of these. Youre getting the bassame thin. Facebooks going into 24hour live, and youll compete for the eyeball space. You need a Balance Sheet in these businesses now. Theyre all buying content. And i dont think snap has that Balance Sheet. Facebook does have a Balance Sheet. Exactly and they have management, and they have people best of the best. Questionyes. Best of the breed. I own it, you still own it. Its approaching 140. I believe at 140, that could pull back. Thats the one name on a pullback i would buy. But overall, i think social media itself, the concept of it, when you look forward into 2017 and see the absence of events that you had in 2016, i think you have to question and the leaders in this space are going to be the facebooks and googles of the world. We know snap really doesnt have earnings. You have twitter out there. You have more cult followers that weve talked about, because people think these are takeout plays, especially for twitter and a couple of the others. And there needs to be a consolidation. And the question is if facebook starts buying them, their stock is going to get crushed. Lets move and talk about this initiation ton biotech at ubs. There are a lot of names in here and i want to give folks your view. Let me do this quick. Sell genes a buy. Regeneron, buy. In fact, excel rons a buy, vertex is a buy. Then go to some neutrals and biogen at the bottom gets a sell. Take these calls in the buy ratings first. Celgene, regeneron, vertex . First of all, to buy a buy stock, any stock in the world is 10 upside. So im not getting paid for the risk if he thinks thats the upside target. In terms of the other buys, pretty much generic. Not in terms of generic drugs, but generic recommendations. Bib has been somewhat controversial. The stock hasnt performed. Its been a favorite for a very, very long time. So thats the one i would dig into a little bit more. Looking at a 10 downside. Any stock has 10 downside at that point in time. In this space, especially. Exactly. So to me, its an issue whos on the board. Lets see what he does from here. All right. Gold prices on track for their longest losing streak since may of last year. Well get the you the plays from the future traders, coming up next. Next. Take a look at the s p sectors, though. Were back after this. E back af. Why do so many businesses rely on the u. S. Postal service . Because when they ship with us, their business becomes our business. Thats why we make more ecommerce deliveries to homes than anyone else in the country. Here, there, everywhere. United States Postal Service priority you deartheres no other way to say this. Its over. Ive found a permanent escape from monotony. Together, we are perfectly balanced. Our senses awake. Our hearts racing as one. I know this is sudden, but they say. If you love something set it free. See you around, giulia various shouting heigh ho its off to work we go woman on the gulf coast, new exxonmobil projects are expected to create over 45,000 jobs. And each job created by the Energy Industry supports two others in the community. Altogether, the industry supports over 9 million jobs nationwide. These are jobs that natural gas is helping make happen, all while reducing americas emissions. Energy lives here. Welcome back to the Halftime Report. Im Jackie Deangelis. Gold falling today for the eighth straight session on pace for its longest losing streak since last may. Very close to 1,200. Anthony, is this weakness were seeing all about rates and investors waiting for next weeks fed meeting . Well, jackie, lets look at the latest move in gold to the upside. It started when trump was elected. I think a lot of these investors came in thinking that the economy under his administration would implode. Certainly, that hasnt happened at all. And i think theyre unwinding these positions. With the fed likely action next week, i dont see a reason to own gold right here. And if they raise three times, i dont see a reason to own gold at all. We saw gold touching the 1250 level as recently as last week, hovering just over 1,200 today. What are the levels youre watching . Whats the trade from here . Well, gold has been chop blocked the last eight sessions. Remember, february 27, they were trading 1274. But i think 1,200 is an imperative level. Look, technically, 1100 to 1290 is large. But i think the market is ignoring the fact of the mounting tension in northeast asia. And i think if we see china come back with some type of response to our Missile Defense system being shipped over to south korea, i think that puts a bit back into gold and i think well be range bound from 1,200 to 1250 the next month. So many things to watch. Meantime, weve got an extraspecial show for you today. Joining us on futures now, art cashin, ubs director of floor operations. Hes at the New York Stock Exchange. And kathy ruby vera. Well discuss the fed and stocks on this eightyear bull market anniversary. Thats the top of the hour, futuresno futuresnow. Cnbc. Com. The Halftime Report back after this. This. [pony neighing] what . Hey gary. Oh. Whats with the dogsized horse . Im crazy stressed trying to figure out this complex trade so i brought in my comfort pony, warren, to help me deal. Isnt that right warren . Well, you could get support from thinkorswims inapp chat. It lets you chat and share your screen directly with a live person right from the app, so you dont need a comfort pony. Oh, so what about my motivational meerkat . Inapp chat on thinkorswim. Only at td ameritrade. Hey, hows it going . Um. Who are you . Im val. The orange money retirement squirrel from voya. I represent the money you save for the future. See . Were putting away acorns to show the importance of being organized. Thats smart. Whos he . Hes the green money you can spend now. Whats up . Oh you know, gonna pay som bills, maybe buy a new tennis racket. Tennis racket for a squirrel . Hes got a killer backhand. When its time to get organized for retirement, its time to get voya. Stocks on the move today, 3 , who has thoughts on the storage space, other parts of technology, whether its chips or otherwise . Realm, you know, in terms of chips, ive been partial to the more specialized chips. Qualcom and nxpi acquired by them gets them in cell phone and automotive of things. Thats what i like. I dont like things that are commodityings in the chip space. I dont have anyone invest add at all . No. They really from what we told you yesterday, but i know thats unusual activity. Moving up a percent today. You know, better than any of the other chips. Its a good name. New levels. I know you care. Collaborate on products. Stock had a good move yesterday, they missed. Everything you do is unusual activity. What happened to you since the break . Speaking of the break, we couldnt get to one fast enough. Respond on the other side. The greatest population shift in Human History is happening before our eyes. 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 busisses 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. Duexperience our mostand perefined models ever. T, including the ls, lx and es. Experience amazing. [phi anne. G] so those financial regulations being talked about . They could affect your accounts, so lets get together and talk, and make sure everythings clear. Yeah, that would be great. Being proactive. Its how edward jones makes sense of investing. All right were. Markets close in flthree hours. Final trades. Tomorrow is important, obviously, but positioningwise, a a lot of folks, jimmy and i talked about this before, play for a breakout in the u. S. Ten year treasury, up off 260, thats the lie 4 highest level seen. Tbt is the way to get involved. Joe, it doesnt look back once it gets there. I dont think youll see 250. 27 in six months, tbt. Yes, it is. Fed not aggressive, indicators doing well. Promoting higher. The chatter from the desks playing tomorrow, however, futures market, playing for a break 60. I like tk because the earnings, upgraded. Defense is the place where you want to be. Msp. You know, we talked about this for weeks now in the asset play versus market cap. Theres a breakout. Up 1012 . I dont own enough of it. Ill buy it although its up 12 . Doc . I like whole foods. Wfm. I know its where money goes to die many times, but i like it because right at the money, they are buying the 30 calls in april. You got a month for that to work. Im buying those calls. Focused orn oil. The next couple days, you get a great employment report, oil goes down, dollar up. Watch it. Does the stay above fourth if. What happens with a monster jobs number tomorrow . You get a tweet right away from the president. Aside from that. Financials have big moves storm. That would be a good number based on met tricks that came out around the challenger the expectations are high. I think the rotation gets strong into the financials because theres a lot of people not convinced enough that thats that thats the right trade. I dont think the employment number means all that much. Absent something, aberrational. Its a a free one. We know the economy, the t trajecto trajectory. Making too big a deal of it. Its not 2009 and 2010. But its going to take certain indicators that are very relevant right now like the u. S. Dollar. Whats it do to the u. S. Dollar tomorrow if its a blowout number . Takes it to levels slightly uncomfortable. Only if the dialogue changes. I think the fed goes three times. If the dialogue changes with more people in that camp and more aggressive tightening schedule, then you get that, but otherwise heres the question i have back to something you asked. Whatevers going to derail the stock market is something were not thinking about. Were not talking Interest Rates much. 260 does not knock it down, but as it marches closer to 3 , theres a point of no return where, woe woah, higher Interest Rate rates hurt profit and consumption. I disagree. Its still accommodative. Its always the rate of change. Youre right on fundamental basis. This is a trading point of view. Buy if that happens, right . Absolutely, yeah. I think thats where, we came back just the active management coming into place. Yes, it does. Sectors will benefit and some wont do well at all. Money flows out for nonfundamental reasons. Oversold. A couple stocks as my final trades before we go, and theyre in the video game space, blizzard, electronic parts. Activision is great. What i saw was 46. Were at 49. Yeah. Both stocks from 93, all time high today. All for us. Good seeing you. Thank you for watching. Power starts now. Im melissa lee. Heres the menu. Crude, new reality. Oil below 50 for the first time this year. Are we headed lower from here . Hear from the jcpenney ceo as well, details on the turn around plan for the struggling retailer. One of james bonds yacht up for sale. Wait until you hear the price tag. Break out the martini glasses, power lunch starts right now