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tv   Fast Money Halftime Report  CNBC  June 25, 2012 12:00pm-1:00pm EDT

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for years. that impedes new programs. we still fight over the same issues, health care, bailouts, t.a.r.p. we need to move on. back to you, buddy. >> back to "fast money halftime report" back at hq. carl thanks so much, four hours to go until the close. i am standing in front of a board full of red today. take a look at the major averages under pressure. s&p going negative for june, continued concerns over what's taking place over in europe. there are the industrials down 1.5%. s&p 500 off almost 2%. technology is getting absolutely hammered today, down by more than 2%, nasdaq, energy, financials dragging markets lower. take a look at commodities. gold higher. crude down. silver rocketed higher in the
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last 4 5 minutes or so. up 3%. growth slowing. rutledge outlook on china. zynga, beyond facebook, is it more than double. the analyst says the company will unveil bullish clues for growth tomorrow. unhealthy, uncertainty. no word from the supreme court on health care today but trading ahead of the news with manager of t. rowe price's health sciences fund. welcome to the halftime report. lots to trade today. the selloff we're seeing in stocks. continued concerns about slowing growth on europe, elsewhere as well dragging conseo on sentime. financials are down not only in europe but here as well. >> we're seeing a big pop out of the vehicle. volatility metric for s&p 500, 3 points to the upside, an 18% move back to the up side.
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but futures are not moving like that. >> let me just get to you hold your thought for a second, bring everybody to attention to look at the headline at the bottom of our screen now. the greek finance minister to resign. that is reuters quoting the prime minister's office over in greece. so we'll continue to follow that story. but that clearly just exacerbates what we're talking about. uncertainty in the eurozone is the headline of the day. >> yes. people scared about what's going on over there. obviously there's back room dealing with what's going on given this resignation that was completely unexpected here. so i think people are doing what they do when they panic. that is they are reaching for protection right now. that is probably a pretty good sign that the markets are very nervous. >> joe, they are certainly nervous ahead of this european summit which is going to take place later in the week. you have officials, whether it's merkel or others talking about what shouldn't be done, what
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shouldn't be the topic of conversation at that summit rather than some sort of concrete answer as to how to solve this whole mess. >> the market is trading off on i think disappointment on what went on on friday in rome. basically you're having $163 billion growth package, which is 1% of eu gtp. that is not what the market was expecting to hear from european big four. there's disappointment. again, there appears to be this continued concept of all for one, one for all that they can't achieve that. that's a problem for the marketplace. i myself last week was adding in the highs. i was clearly wrong. i'm back in there again shorting s&p futures which i know scott you love when i do that. >> i do. >> you have to see protection in this marketplace right now because the market is telling you when you look at the price action that it's incredibly disappointing. >> grasso on the floor of the new york stock exchange. the vix at the highs of the day, thus we see stocks at the lows when we come on the air. >> talk about 1335 level being
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crucial for the marketplace. that's exactly where we closed in cash on friday. we had russell rebalanced, screwed around with a lot of momentum on the buy side. now you're starting to see us drift down lower. very important to hold this level. i think we do test those goldman levels below 1300. their level below 85, mine 1266. that's the recent low i do believe needs to be retested. that's basically in the on year as far as s&p is concerned. >> what you're referring to is that report goldman put out late last week we spoke about. good opportunity to short s&p to 1285. short-term move. nonetheless that's what golds looking for. what's that, grasso? >> real quick. even though the guys believe in the marketplace and are bullish, ask them why, they can't elaborate why they are bullish. the whole best apple in the bunch thing is getting a little long winded, long in the tooth. guys are looking at it as low
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growth, slow growth, i'd rather sit on the sidelines. >> josh, where are you in the markets today? >> none of this is surprising to those looking at the big picture. when you focus on micro stories and big stocks you have a tendency to say this is too cheap, that's too cheap. that stuff works most of the time. this is one of those scenarios where it is not working. i agree with grasso. when you talk to people who are bullish. they are bullish primarily i think for two reasons. number one because they have to. their job is to be fully invested, long all the time. they have to find something they like, even if it's only relative to other things. the other reason people might be bullish, they expect some kind of literally central bank action or a headline that's going to make everything better. we had a short covering rally in early june, reversed some of the negativity from may. we're right back from we are, a very good reason, nothing changed. >> there are those look at the market pullback. see it as a buying opportunity.
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maybe to the point you said they are hoping for a headline to come out. >> scott, nothing wrong with that. we've been nibbling on things we like, we like value oriented and fundamentally weighted indexes here. we've been nibbling here and there. to be fully invested at a moment like this you really have to think for some reason you know something everyone else doesn't know. i really think that's farfetched given the fact this is a policy driven environment supported only by economics that are not good, frankly. you look at new home sales data from today. everyone says a two-year high for new homes. new homes less than 15% of new homes sales. don't get so excited by individual data points will keep in mind the fact right now data not on your side but you can nibble. things won't always be so terrible. >> give a quick response. let's just also throw out there, you do have people like george soros, who knows what he has on, saying europe basically has three days to figure this crap
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out ahead of the summit. >> i really think what josh is speaking to is the old way of investing, which was to be passive. you can be more active in these marketplaces right now. there are things working. when you look at earnings, upcoming earnings season two weeks away, earnings continue to be resilient in this environment. technically approaching a moving average 1296. you want something to lean against. there's something you can lean against. i think a lot of large cap balance sheets they continue to work in this environment. take a look at ibm, mcdonald's, not down nearly as much as the overall take today. there are things if you're willing to be active that are working in this market. >> call your attention as well to the bottom of the screen where it says morgan stanley the low of the day, weakest group as i said at the top of the show. in the s&p one of our traders making moves in the stock, managing director at tjm.
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jimmy are you one of the reasons this is at a low today. >> i think there's a million reasons ahead of me selling it, a low of the day. >> that was a little tongue in cheek. >> george soros says have three days to figure it out. figure what out. either the euro comes to a bad end, which i hope it doesn't or they have to print, provide security, either way the euro is going lower. it's about time we start talking about big u.s. banks and their exposure to europe and what happens if they start getting paid back in weaker euros or god forbid lira or drachma. morgan stanley was the bank they consider with the most exposure. i don't care if they do or not. i just care that the market thinks they do. a poster boy for european risk so i sold morgan stanley, sold it at about 9:40 chicago time. i also saw a story about bank bon yous being higher. going into the political season
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that does no favor for the banks to be giving big bonuses when every politician wants to punch them around. >> jim, it's josh brown. one thing we've talked about before on the show, i think, a popular chart that seems to be making the rounds. morgan stanley and euro banks stock in deck, bloomberg index, almost a one for one correlation of the last two years. >> isn't that great? that's why i picked morgan stanley over the others. like i said, i think you underlined my point. whatever the true story is, they might have least amount of exposure to europe. i don't care. if the market anoints them the one, they are the one. >> i took off the bank exposure i had not because i saw this coming at all. i took it off morgan stanley trade, jchl p back on friday. goldman sachs down $12. now down $14 from main numbers.
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so in other words as that thing reversed and gave you the opportunity to took it off, i took it off. if we go far enough, then i'll dip my toe back in. right now i'd say goldman sachs getting hit the hardest of this group, looks like i'd focus on first. >> you haven't seen enough to give you confidence now is the time to pull the trigger and buy any of these banks. >> no, i haven't. although a number of folks pretty dang good on the charts tell me we're getting to areas that get very interesting to them, in particular s&p 500. >> new concerns about a global slowdown, citigroup lowering china's second quarter gtp estimates to 7.3%. john rutledge, chairman of rutledge contaminate. he joins us with his second half outlook. it's a pleasure to welcome you back to the halftime show. >> good morning. good to be with you. >> you've been the most bullish when it comes to china, especially on this program. are you willing to concede perhaps things are slowing a little bit more than maybe you
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imagined that they would? >> of course. it's hard to get excited about any of the news you see coming out right now. let's talk about what's news and what's not. i don't view an economist changing his mind about the world as news, or information even, including the citibank deal. the pmi report on friday, that was more interesting. but the fact is, that didn't show anything we didn't know either. there's softness in chinese capital spending. i don't think the risk is the exports, the risk is the capital spending. chinese policymakers have not done enough to try and counter this. so i think we're still looking at 7.5, 8% for the year. 7, 7.5 for the next quarter or two, and more stimulus to come. so if we're talking about def con2 at this, no reason to be overall concerned? >> let's talk about what we're worried about. the reason we're worried is china is the only place growing
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in the world. it's like going down the carpool lane at 80 miles an hour when all the other lanes are blocked, it's an accident waiting to happen so everybody is frightened. the other reason what john said a little while ago. people are panicking, because since the rest of the world was so ugly people put money into china emerging markets that didn't know what they were doing. when we get bad news, some running for exits shouldn't be there in the first place. i think the market reaction is adverse. i don't want to be anywhere near china related stocks right now. i don't think the fundamental growth rate is what's driving this or is a huge risk. it's the stories about chinese growth that are driving it. >> where should people be putting money to work right now, john. are they the same? have you changed your opinion on freeport, caterpillar? are you using any headline driven selloffs to buy these
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stocks? >> i like to use those stocks like the keys on a piano where you're playing the china song, so you play freeport, cat, deer, those companies. since the ugly april data i sold way down positions to small ones and i'm not back in yet. i think these headlines are going to be with us for a while. i agree with what josh was saying earlier. but the fundamentals are there, so sometime later in the year when we see a little better growth numbers but more likely when we see more aggressive policy actions out of china and maybe a positive residential real estate number or two, then we'll see some move in those. i'm going to stay on the sidelines. for me if i'm not playing china song i'm moving that money back into cash and waiting. >> that's a headline in and of itself, john, that you've seen enough to have enough concern that you're largely on the sidelines now, even at some of the bigger positions you have
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had in the past with exposure to china you've now moved away from them. >> on the china story. arnold the bet that's the more interesting bet to make is the bet against eu which means you're betting the european banks are with drawing loans from the markets. the reason that's important for emerging asia is because the former colonial countries in asia actually have very, very large loans from european banks. so countries like malaysia are greatly at risk in terms of banks with drawing capital. vietnam also has a lot of loans from european banks. >> stick with us for a moment. i've got to go to michelle caruso-cabrera our international correspondent who has more on breaking news out of greece on the finance minister. >> reporter: senior adviser tells me the finance minister is unable to accept the position offered to him because he underestimated his health issues. when he was named finance minister, wasn't sworn in. they hope to have a new finance
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minister named later today or early tomorrow. additionally i am told the prime minister himself will be unable to fly for two months because of the delicacy of the situation on his eye after having an operation on his eye dealing with a detached retina. once again looking for a new finance minister in greece. the prime minister will be unable to fly the next two months because of the delicacy -- delicate situation with his eye. this is another big hurdle for this country trying to renegotiate a bailout agreement. they don't have a finance minister and finance minister is unable to go to brussels. this is something else they are going to have to get through over the next couple of months. >> michelle, are we really to believe the reason the finance minister won't serve is a health reason or related to a policy bailout feelings, sets? >> no, my understanding is he was nauseous, severe stomach pains and was hospitalized even before the induction ceremony.
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i don't get any sense it's politics. all the politics would have been leading up to naming him into the position. believe me there was a lot of horse trading going on behind the scenes in the days leading up to the cabinet. i'm pretty sure this is a physical issue. >> absolutely. you can understand some scepticism. >> i don't blame you. >> michelle caruso-cabrera, thank you very much. >> i thought as an old professor i heard all the excuses there were. i had a student who lost three grandmother's in the same week. this is a new one for me. i didn't know greece had a finance minister. >> john, good to have you on the show. thank you so much. energy and financials leading the way lower today. coming up, we're continuing to give you the playbook for the second half of the year for the top ranked analyst and answers for big questions that remain for apple in the back half of
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all right. welcome back to "fast money halftime report." let's get a quick check of the markets. the only walmart is in the green. a sea of red as the do you off by 1.25%.
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doctor, this certainly looks like a broken chart, a spike off the weakest levels. this is one of the first companies to raise concerns about whether the high end was cracking. >> in particular, the travel of europeans to america because the new york stores, of course, are the flagships for tiffany. if we have weakness and lack of travel coming from europe to the united states and pockets not quite as full and that exchange rate going against them, all of that worked against tiffany. >> josh brown, a decent chart for tiffany. it certainly has taken a decidedly worse turn here. >> coach is in the same group. reality is starting to catch up with some of these high-end names. think about it. china's biggest export market actually is not the u.s., it's europe. and so everything is kind of connected. when you look at some of the challenges in china to the luxury class even, forget about the peasantry in the middle of the country, just look at local
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provinces, you're talking about 1.7 trillion real estate debt is the last number i read that really is being looked at as a loss. you're just seeing horrible data points that affect the hoipaloi. right now is not the time to look for viable dip. >> social gamers set to unveil new games. with facebook spiking with zynga be able to breakaway and stand alone. collin sebastian joins us with a call. put in perspective what tomorrow will mean for zynga traders of the stock and those thinking about getting in with it. >> tomorrow is an important day for zynga. i think we have expectations for a lot more detail on their game pipeline. in particular a broader more
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diverse pipeline. also what their plans are for mobile devices, smart devices, tablets and phones. >> in terms of the relationship with facebook, obviously facebook from a stock standpoint has had a fairly substantial turnaround from the lowest levels we've seen. yes, the stock is down today as the broader market is as well. but sum up the relationship between the two companies. as facebook business model is questioned, what does that mean for zynga? >> i think to be fair to zynga, one element of strength is business and credit, that is driven primarily by zynga. we have seen a little bit of a slowdown in q 2 in terms of social gaming. zynga is no doubt part of that. some of the games, more casual games, a little long in the tooth. i think social gaming remains a compelling growth driver longer term for facebook. >> colin, dr. j has a question. you have a $13 price target.
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>> double. >> talk about optimistic. >> which i give you credit for, colin. given they have eight out of the ten top grossing apps on facebook i can see why you're optimistic there. one of the things you have to be focused on and i know you mentioned in previous notes as well. you talk about how much it costs to get people into the app and interested in the apps in the first place. in other words, their customer acquisition through the facebook, that's been the big driver for them. are they going to end up spending too much, though, when they are going outside of facebook to get those same eyeballs? >> yeah, great question. when we upgraded the stocks two weeks ago, i think one of our points, compared to other developers on facebook, which in some respects are abandoning the platform, zynga has a special relationship with facebook that provides some traffic guarantees which make it cheaper for zynga to acquire the customer, traffic than their competitors. that agreement with facebook
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continues through 2015. we think that provides a lot of visibility for zynga in comparison to the other publisher. >> colin, thank you so much. >> colin sebastian with us. joe. >> talking about fundamentals of zynga and they line up nicely here. you have two lockup expirations, july 6, and august 15th, 150 million shares. do you buy ahead of those? no, you don't. >> second half of the year could be a huge one for apple. investors are watching for everything from a new iphone, apple tv to a smaller ipad. which has the biggest chance of becoming reality. top analyst from sanford bernstein joins us with his predictions. welcome back. good to have you on the show as always. >> my pleasure. >> size up what's at stake second half of the year for apple. what's the biggest issue in whether the stock reaches levels you and other more optimistic
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analysts think it will? >> i think the most likely event is certainly the iphone 5 which we expect in the september, october timeframe. it has to be successful. we're seeing incremental competition on the hardware side from very strong offerings from folks like samsung. so the iphone 5 will be a big deal going forward. that's really what's going to drive apple's economics to the next level in the near term. >> china had an impact on the most recent earnings report. are we naive to believe that kind of growth rate in china can continue? where do you come down there? >> i think there's a lot left in china. there are two big legs of growth left in china. the first one is signing up china mobile, the largest carrier in china, 700 million subscribers. apple currently does not distribute the phone or china mobile does not carry the iphone there. we believe that a deal with china mobile will likely happen
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in the next six or eight months following the introduction of the iphone 5. that's one big driver of china growth. the second one is we're seeing enormous and rapid adoption of smart phones. just a year ago about 15% of phones in china were smart phones. today about 50% of phones sold in china are smart phones. we think over the next couple of years 80% of phones sold in china will be smart phones. >> you yourself say in the note you think china apple not as big as investors think. you have some doubts. >> absolutely. i think there's a miss perception of how big china mobile can be, there are 700 million subscribers, 600 million are prepaid meaning they have to buy a phone without a contract. they can do that today. so the real green field opportunity at china mobile is the post paid customers, those who receive a subsidized phone
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and get a phone on contract and are locked in for a couple years. that's still $100 million subscri subscribers, the size of ver verizon. that's still the number people view as an addressable market. >> a quick question about 4g, has to have iphone 5, of course, to really get that upgrade cycle ramped up. a lot of people waiting for 4g phone, a true 4g from apple. how big do you think that upgrade cycle will be if, indeed, most of the rest of the phone is what we have been reading on the web. >> i think it can be significant. what we're seeing now with apple is a much more pronounced cyclicality around cycles. consumers are now conditioned to know when the new phone is coming. there's a perceptible pause, which i think we're starting to see, as consumers begin to await the next phone. so we saw 35, 36, 38 million
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phones sold when the iphone 4s was introduced. i think there are buy side expectations that the iphone 5 could yield 45 to 50 million in the first quarter when launched later this year. >> tony, bottom line it for me here. you're urging people, buy the stock right as it sits here today. >> i think apple is a great secular story. i think it's hard to pick data points. the market is really soft now. i think china is incrementally soft. but for any investor as a six-month plus time horizon, this is a great story at a very reasonable value. >> yet are people going to be setting themselves up for disappointment, those expecting the tv by the holidays or end of the year when, in fact, you and your notes say it's not likely? >> yeah. i don't think a television is likely in the next six months. i don't think that will ultimately prove to be a disappointment, because there's no expected announce date. there's no on december 15th apple is holding a conference and we expect a television.
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there has been wide speculation about the television for about a year now. i think because there isn't a precise expectation date, you know, i don't think investors will be excited. i think iphone 5 needs to work. i think a deal with china mobile needs to work for investors to continue to be excited about this name. >> maybe that's the headline traders will take from this interview today. no tv coming this year. tony, good to have you as always. thanks so much. >> my pleasure. >> josh brown, trade this stock. >> i think apple iphone will be huge. they will execute flawlessly. there could be surprises we haven't heard about. this is a name that's come down a bunch. i don't see why if you want to be in it you couldn't start nibbling. >> terra nova, quickly. >> long and more at this price. >> uncertainty around the health care decision, all-star fund manager naming which stocks are a sure bet in that space. stay tuned to get the picks right after the break.
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i don't have to use gas. i am probably going to the gas station about once a month. drive around town all the time doing errands and never ever have to fill up gas in the city. i very rarely put gas in my chevy volt. last time i was at a gas station was about...i would say... two months ago. the last time i went to the gas station must have been about three months ago. i go to the gas station such a small amount that i forget how to put gas in my car. ♪ welcome back. want to show you s&p 500 sector
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heat map show you where the weakness is in the markets. as i said, you can see it here. commodities continue to be a big story in the market. in large part they continue to get hammered. energy down 2.5% of financials are weak, 2 1/3, technology on growth concerns down 2%. take a look inside this you'll see if you look at the dow heat map, for example, i'll show you individual stocks and movements. we mentioned how financials, weakest sectors, look inside that. bank of america, weakest performer within dow jones industrial down 4%. technology we mentioned microsoft, hewlett-packard, intel all among the bottom, weakest performers out of the dow today. there it is. one green stock in the dow, walmart up 0.5%. watching gas futures today, joey, constellation up almost 13%. >> it is. looking at natural gas understand spot contract does expire, i continue to be long natural gas, do it through upl.
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look at ung, that appears to be the trade working today. what i don't want folks to do is rush in and buy the ung. as i said before expiration event, stick with swn, upl. >> i misspoke, looking for nat gas chart. constellation up 13% higher after ubs said the company would benefit from grupo modelo. >> largest in the world. a very positive thing for them. the stock already traded about six times normal full session volume, just exploding to the upside and holding most of those gains. i think they are getting a little squeeze going on what's going on in the rest of the market. like i said a growth prospect going forward. >> watching netflix shares, stock off 1.5% or there bouts, jenny capital markets upgrading shares on a more balanced risk reward. j.b.
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>> fundamentally i don't like it as an investment because it's a drastic business model change. i'm not sure what they are doing. technically speaking a little more interesting. forming a bottom or trying to around the same level it did last november, if you recall, when they first shocked the street. that being said i think you want to see this break above 50-day moving average before you attempt even a short-term trade. i think that's somewhere in the mid-70s or lower 80s. >> okay. we've been talking all hour about the eurozone and fears, what the impact is on the market. it is the market moving headline. fast money trader and harbor capital's bryan kehly joins us on the fast line. b.k. watching euro getting a little move on the dollar. the story, negative viz dollar on the day ahead of the summit later in the week. >> it's still negative and european stocks are also very negative. >> certainly are. >> spain down 3%, 3.5%. definitely a lot of negativity out there.
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the summit at the end of the week has become a binary event. for investors you need to be very careful. i like joe tried to buy last week. it's the wrong thing to do. i'm fully hedged on long u.s. stock positions. i think that's the way you have to go into the summit. a very high risk of disappointment. >> soros saying europe has three days. >> he said three months about two weeks ago, now he's down to three days. >> how quickly things change. >> i think what changed the market starting to realize and demand political changes be made. i don't know if the political will is there to make those changes. we're seeing comments from germany today that suggest perhaps they are not at that point yet. i think that's what the market is focused on, what the market wants. europe is not going to be pushed around by the market. that's what you're setting up here. you have this fear of disappointment. >> headlines that you're speaking of, i saw a comment from a gentlewoman from the ecb, europe should use the
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instruments they already have. merkel saying what shouldn't be discussed later in the week. so again, nobody willing to go out on a limb, guys, or b.k., for that matter and think bigger for what the market really wants. they want bigger. >> right. the problem is, scott, germany is the one with the money. they don't want to dole it out unless they have control over how it's spent. since they have no central government they have to bring the system to the brink every single time. crisis led reform. at this point in time, that system can break down quickly. that's where we're at. that's why george soros saying it has three days. you created a crisis. if the reform doesn't happen, it does create self-reinforcing crisis on the downside. >> brian, thanks for calling in. coming up, the buzzkill. plus are shares of boeing taking off? the analyst who upgraded the stock today. stay with us. us.y assets. i'm not paying hidden fees or high commissions.
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today. gold is a today. gold is a place to keep an eye on. take a look what's happening in gold, off the level. a move higher 17%. >> a couple weeks ago we would see gold do what s&p is doing.
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we decouple for a week or so when we heard the chairman speak. now a fade again. i think it's extremely optimistic for gold direction i'm staying long on gdx. >> silver. >> a nice intraday reversal. overall when you look at the commodities space and get to a level where you're at now, you're going to be able to identify who truly is fundamentally challenged. look at today's tape, dollar off, copper and oil itself down for the day. there are fundamental challenges there. in the rest of the commodities space, natural gas, gasoline, sugar, coffee, grains, metals, all higher. >> as investors wait for a ruling on the supreme court on the health care law one top fund manager says he's buying names that will do well regardless of the decision. kris jenner runs the $4 billion t. rowe health sciences fund up 17% so far this year. chris, thanks so much for joining us. >> hey, scott. good afternoon. >> what are your expectations from the court.
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>> i'm in the camp which is largely consensus the individual mandate, this is kind of the requirement that all people have health care insurance, i'm of the opinion that is struck down and some health insurance reforms intimately connected are as well but largely the bill remains intact. that's my view. >> any stocks you think will win regardless of what happens? one of the challenges for traders, investors is trying to score this thing ahead of time and figure out where you want to be based on what the decision is. is there one place where it doesn't matter? i think that is really an away game. it's too hard to play, certainly not the one we're kind of contemplating. we're asking the question you posed to me, where can you do well regardless of what the supreme court decides. one element that we think is going to continue to grow and be cost effective is the overall expansion of the medicaid
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program. this is the program that is set up for indigent individuals. we think that that's going to have significant expansion. if that's the case and we're correct, there's several good stocks out there that are going to benefit. >> let's talk a couple of names. what do you like best? >> a couple of midcap names, amer group, and cnc, both are poised to do well. as it relates to medicare expansion, just one aspect of overall growth of the medicaid program. many states going for the first time to outsource the care of their medicaid population to copies like adp and cnc. there's another big, big massive opportunity called dual eligibles. we spend over $300 billion annually on 9 million americans today that both of beneficiaries of medicare and medicaid. that's another opportunity that
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will happen regardless of health care reform. if you want to sleep well at night, the stock i would recommend that is the best position for whatever happens is united health care ticker unh. >> that being the largest of the hmos. >> that's right. it's the largest. you're not going to get as much bang for your buck but i tell you they have wave after wave of new products and innovation relating to what ails this country, which is we need to bring health care costs down and we need to improve outcomes. that's what keeps these people up at night and driving to solutions. >> steve grasso has a question for from the floor of the exchange. >> hey, chris. we've seen other fund managers positive on the hospital names. i agree with your rendition of how it will play out. i, too, would go to unh. should we avoid the hospital names? is it more of a sell the actual news event as we've seen them run up to the decision.
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>> hospitals are leveraged to increase volumes. health care reforms in 2014 has the prospect of increased volumes. so far in 2012 and 2013, overall health care utilization is bumping along the bottom. as it relates to hospitals, we just are not large owners of the business model. we don't think it's a good long-term opportunity. better left for traders like yourself. we have found better opportunities in the maps to distinguish ourselves. >> chris, great to have you on the show. >> grasso, a compliment. slick trader. >> i don't know whether to smile at that or not follow him on twitter but thank you, chris. >> very slick, grasso. very slick. up next is the dreamliner becomeing a dream for boeing investors? we'll talk to the analyst upgrading that stock today when we come back on halftime. what ?
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today on power today on power lunch, no decision on health care means more land mines potentially for the markets at the end of the week. we will some plays and smart advice. oil markets watching iran ahead of a key trade deadline this coming weekend. see what it may do to the price of oil. and the ceo of flipboard joins us to talk about twitter ipo and his company's new big deal. that's today on power. back to scott.
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>> thanks very much. see you at the top of the hour. analysts at oppenheimer updating shares resilience to macrohead winds. will the 787 be a dream for boeing? analyst at oppenheimer joins us. welcome to the show. >> thank you. >> all about 787? >> it is all about 787. it's been a lot of years of disappointment around that program. it looks like it's finally kicking into gear. >> can they actually turn out enough to make that program profitable? >> it looks that way. they have a backlog of 800 planes. that should keep them busy for well over seven years based on orders today. what's more important, production appears to be finally kicking in. as of two weeks ago they started producing these things off the production line without having to send the planes into a secondary hangar to fix all the things that couldn't get done the first time through. now that that's happening, a chance to work down the cost curve, increase production and start generating cash in the
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coming years. >> where does the global economy factor into all of this, whether talking about the emerging markets, china or you obviously know is taking place in europe? >> right. if you look historically at commercial aircraft demand, it really is inconsiderably sensitive to the macro economy. what is different about the 787 is that it's a brand-new plane, 20% more efficient, has the ability to connect cities that have never been connected before in an efficient way. and it's a secular story, very much like the ipad a couple years ago for apple. a new category that's not just tied to overall economy, but the ability to take away older platforms and create fresh demand in the market. >> if only those planes cost $499, though. thatunder scores what you were saying. how can a company be so closely tied to what's taking place in the global economy and you be so optimistic when a time it's
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obvious the economy is slowing? >> again, when i say 20% fuel efficiency well tiff to other planes, that is huge. in other words, if you can buy one of these planes and swap out a 767 or, you'll make moan from day one. the scarcity value of these planes, only a handful of these have been shipped, the backlog extends out seven or eight years, even if some of the people early on in the delivery line broadband shirkers there are plenty of people backed up, will be happy to step in and get that plane early. >> yair, thanks so much. joey is looking for a $90 price targets. >> you want to be in the k34e6r7b8 airspace. that's clearly where you go with this trade. if you like boeing you, go downstream action look at a precision castparts, but they're
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building out the interiors. they will be a winner if boeing continues to look good. up next, we'll head to the twitter-sphere. . ...the united states would be on that list. in 25th place. let's raise academic standards across the nation. let's get back to the head of the class. let's solve this. that could adapt to changing road conditions. one that continually monitors and corrects for wheel slip. we imagined a vehicle that can increase emergency braking power when you need it most. and we imagined it looking like nothing else on the road today. then...we built it. the 2012 glk.
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seema seema mody is on the beat. >> we have a lot of action in basic materials and commodities. let's zone in on that space. hot weather and a lack of rain
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means lower supply of corn and wheat. that's helping agricultural stocks. check out cf industries, shares are rallying today and an upgrade from dammen rose. it looks like tech tech 2 hundred, currently treating around 180. trader mish dan says he recommends it. jjg, the ubs greens index, saying until it rains, crops are toast. obviously weather plays a big role in the price conflict way of corn, so how do you hedge your self-appropriately? >> joe, a good question. where would you be in ag? >> the del monday rose cause on agrium, cf, potash. >> cf industries, that's the direct tie, nitrogen fertilizer, it remains the winner, and i like the fact that the greens
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futures have held a significant gains from early this morning. >> potash as well, very unusual option activity form seema, thanks so much. more final trades, next. ♪ here we are, me and you ♪ on the road ♪ and we know that it goes on and on ♪ [ female announcer ] you're the boss of your life. in charge of making memories and keeping promises. ask your financial professional how lincoln financial can help you take charge of your future. ♪ ♪ oh, oh, all the way ♪ oh, oh
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educators improve student success in math and science. let's shoot for the stars. let's invest in our teachers and inspire our students. let's solve this. welcome back. markets have been under pressure p pretty much hanging around the lowing of the day. within that, the weakest sectors energies, financials, technologies. commodities have been hammered. morgan stanley was one of the weak performers, and technology dragged down by many of the biggest names. grasso, kick us off. >> sds. i used it friday, it worked. i use it to hedge against your long. >> josh brown? >> biotechs on a

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