Closing Bell Overtime: Investors Weigh Weekend Geopolitical Headlines; More Tech Weakness 3/30/26

The Bells bring in into the training day at the NYSE Copper's Holdings, not the Nasak.

It is BlackRock in honor of a new Ethereum ETF.

Welcome to Closing Bell.

Over time, we're live from Studio B at the Nasak Market site.

I'm Alyssa Lee along with, Mike Santoli.

Socks mostly lower today as President Trump tries to ease concerns about the Iran war

in J-Powell.

Eases concerns about a fed rate hike, much more in the markets straight ahead.

Our market's team is all over today's action.

Christina Parcheneville is on the market movers.

Tip of Stevens on oil, as it settles above $100 a barrel, image average has more on those

comments from the President, plus UNSU and live from China this hour on the potential ripple

effect of soaring oil prices.

So, you know, Alyssa, I guess marginally oversold conditions have not been enough.

And so everybody looks at the tape and says, need more extreme extremes.

You have to have a little more damage done, a little more indiscriminate stuff.

They like today, I'll get you there kind of, but it's interesting.

Because rally attempts get knocked down and we can't really embrace lower treasury yield.

So it's still kind of uncertain footing here.

Yeah.

And the volume has been light, which has been the trend.

Yeah.

But the action has been, for the past three sessions, not good.

We sort of closed towards the lows of the session on light volume, sort of listless.

But again, to your point, not able to lift itself up.

And we did see some massive flip flops within the day, within semi-conductors, for instance.

Oh, yeah.

So, in the beginning of the session, it was up as much as 5%, finishing the day lower by 5%.

Yeah.

I mean, that is quite a reversal.

Yeah.

I mean, I think you can squint and say, hey, look, the alternative asset managers were up.

And banks were flat.

Right.

And maybe that means that the things that got hit earliest are getting some relief.

And that, again, is the process rolling forward in terms of this correction.

On the other hand, it could just be kind of mechanical reshuffling around.

But the bond market move, I mean, in terms of yields finally, you know, responding to

the idea that there could be a slowdown, that was an interesting sort of change in the

pace of the day.

Pretty dramatic on the charts, if you could look from midday Friday, really sharp declines

in the yields, absolutely.

Well, let's get to Christina Parts and Evels now.

As those once hot AI-related names continue to sell off, Christina.

Well, we're getting closing out one of the biggest unwind days of the year when investors

really dump the stocks that have been running the hottest.

Those fast-moving momentum names, that's where we have the momentum ETF up right here,

seeing some of their worst moves in quite a while.

These are companies that tend to swing with the markets.

And you talked about the unwind, perfect example.

You can see later on in the day, really, it's selling off optical stocks, like momentum,

macem, coherent, all down, more than 6% across the board.

Cloud-related names, memory chip names are all or were under very heavy pressure today.

In fact, the five worst performers in the Nasdaq 100 are all memory stocks.

Iran, Western Digital, also storage names to Marvel, Seagate, and Lamb Research.

But the drop is more about just too many people being piled into these same trades and

not necessarily about Google's turbo-quant story from just last week, which at this point

many are saying just is overblown.

On the upside, software stocks outperforming the semiconductor state, the SMH is already

though, down about 11%, almost 11% this month, cyber security though, software names,

those climbed higher, Crowdstrike, Palo Alto, boosted by Palo Alto's after its CEO, specifically

bought $10 million worth of stock, just last Friday, but he had a post today, so that

added to the momentum.

And in the broader market financials, we're the best performing sector today, but it's

really the insurance companies that led the way, like you can see Arthur J. Gallagher,

4%, Marsh, etc., all these names higher.

Guys, Christina, thanks, Christina Parts, Nevilleis, WTI, and brand continuing to rise today

with U.S. crude selling above $100 a barrel for the first time since 2022.

Let's bring in Pippa Stevens for the very latest Pippa.

Hey, Melissa.

The brand-made contract rolls tomorrow with the more actively traded June contract, right

around 108 right now, with WTI at 103, and the spread between the two Atlantic-based

cargos is starting to narrow, as European and Asian refiners look to make up for the

lost Middle East barrels.

Kepler expects U.S. April exports to Asia to hit records, more than doubling typical

levels.

WTI cargos into Rotterdam also moving to historically high premiums, as Asian demand

pulls barrels away from Europe, leading Morgan Stanley to say, the Atlantic Basin is no

longer a buffer.

It's now the marginal source of relief and is being reprised accordingly.

Meanwhile, people eye on aluminum rising after Iran targeted the two largest single-site

smelters in the Middle East, Emirates Global Aluminum, saying its site in Abu Dhabi sustained

quote, significant damage with aluminum Bahrain also hit, together the two facilities produced

about 4 percent of global supply, aluminum stocks, including Alcoa and Century Aluminum

seeing big gains today, but JP Morgan saying the medal could quickly run towards $4,000

per metric ton or even higher before a demand-driven unwind.

Mike.

Pippa, thank you.

Well, we're getting some fresh comments from New York Fed President John William Steve

Liesman has the details.

Hey, Mike.

He's talking about the conflict in the Middle East, saying he sees substantial risk and

high uncertainty in the economic outlet from especially those events.

He says the Middle East conflict could result in a large supply shock, and you guys were

just talking about this, raising inflation on the one hand and dampening economic activity

on the other putting the Fed in particular, a difficult position.

He has said he's already seeing supply chain disruptions and energy and energy related

goods.

And tariffs and high energy prices should raise headline inflation in the short term,

but he's a little more optimistic as the effects of both the energy price increases and tariffs

should reverse.

And that, of course, assumes that prices come down and hostilities end.

It's a big part of his forecast that all this happens after hostilities cease.

No sign on the good side on inflation.

No sign that tariff increases are spilling over to the rest of the economy and also as

that the labor market is not adding to inflationary pressures that are out there.

He probably sees a resilient economy GDP close to 2.5% this year, tailwinds from fiscal

policy, favorable financial conditions, along with AI investment.

He expects unemployment to edge down an inflation at two and three quarters this year, but going

on to 2% in 2027, sees mixed signals when it comes to employment with inflation stable,

but concerned about job market expectations.

We'll leave it there, guys.

I just point out that if you're going to ask me when he said about monetary policy,

I don't have anything for you on that.

He did not give much of an outlook other than repeating what was in the statement.

So sorry to dash your expectations there.

Then it's useless.

No, seriously, no, it sounds like he, it sounds like he thinks it's a show really

feel.

Yeah, no, no.

I mean, look, what would I keep here from Fed officials is this idea of kind of scenario

analysis, which maybe a fancy way of saying we don't really know what to think, but

another way of saying we're looking at different options.

And most of this particular option or outlook that Williams gave us was this idea that he

expects the energy price to work through the system and not to have a long run effect

if and when hostility sees kind of a similar idea from Powell today, where he talked about

this idea that energy price shocks tend to be short, short live.

That's been the history of these things and it doesn't want to make policy based on

the idea that policy takes a long time to hit the economy, but the energy price shocks

can be short.

So you may end up adjusting something it doesn't ultimately need adjusting.

Well, at the risk of asking you something else that he didn't address Steve, because

I think it would be newsworthy if he didn't since he's a New York Fed president.

He's the cop on the beat in terms of financial stability.

I assume he doesn't necessarily see or didn't mention anything he sees happening in markets

that are caused for alarm on that front.

No, and this was not really a speech where he might address that.

I think that Powell addressed it.

I'm just going to look at my notes here for a second.

I believe he talked about the idea that he's not seeing systemic risk in private credit

at the moment, but they are watching out for that.

So I think that's the best I can do with Fed commentary on the critical private credit

issue with a lot of questions, Mike, and I'm listening to your reporting on this as

well, which is the extent to which it leads back to the banking system through different

ways, letters of credit, other other methods that are worth watching.

But at the moment, Fed officials are saying they do not see it leading back to the banking

system or systemic risk.

But of course, that was something they said in 07 as well.

Yeah, for sure.

I guess reassuring only so far as it goes, Steve.

Thank you very much.

Well, let's stay with the Fed while John Williams says the Middle East conflict could result

in large supply shocks raising inflation.

Fetcher Powell says he sees inflation expectations as being grounded right now.

Take a listen.

Fetchation expectations do appear to be well anchored beyond the short term.

But nonetheless, it's something as we will eventually maybe face the question of what

to do here.

We're not really facing it yet because we don't know what the economic effects will be.

But we'll certainly be mindful of that broader context when we make that decision.

Our next guest says Powell is signaling the Fed sees this as a supply driven oil shock

with longer term inflation expectations still anchored.

Joining us now is Charles Cantor, Newburger-Berman senior portfolio manager and managing director

to see it, Charles.

Good afternoon, Mike.

We have plenty for markets to chew on and maybe worry about.

I guess this suggests that an aggressively hawkish Fed is not among them at the moment.

I think that's right.

I think I think I've been really surprised the way that bond markets behave this month.

I was confused by the idea that the correct policy would be to increase short term rates

into a consumer that was already facing headwinds from gasoline prices.

It didn't seem sensible to me to add misery upon misery for the consumer.

And I thought what Chairman Powell had to say today made a great deal of sense.

And I started to worry that the oil thing could create a policy mistake.

And for me, I thought the policy mistake rhetoric is now off the table relative to those

comments.

And I think the Fed realizes that it can't do much to fight oil prices today.

They're not going to go up forever.

And I think when you look at the inflation index bond market, certainly on a five and

ten year basis, which I think power is leading folks to think through, inflation expectations

on the long end, of course, remain very measured.

Rick Reader just told Scott Wapner in the previous hour that he thought the Fed should be

cutting where it's right now in order to ease sort of what is going on with the consumer.

I'm wondering what your stance is on that.

Is that the right policy move?

Move?

If you were to force me into cut or increase, I firmly stand on the cut side of the ledger.

I mean, it's amazing.

Here we are.

March Mandis is almost at the end.

There was a lot of craziness yesterday.

And geopolitics went top of the pyramid in terms of what people were worried about.

The narrative around cuts and investment spending and good earnings kind of got pushed aside.

I don't think the Fed should do anything right now.

I think she just watch and wait and be ready to cut should the economy weaken significantly.

But raising rates to cut growth, to fight inflation, you can't fight doesn't seem sensible

to me.

Does it seem to you that we have enough of an economic cushion?

I mean, obviously we don't know how long this is going to last.

But right now, it really has turned quickly from we're running the economy, how we have

tailwinds to just exactly how much of a slowdown we're going to have.

I think calling market direction in the short terms really hard.

I think warning, investing in the short term has a lot of similarities.

It's uncomfortable.

It's uncertain.

It's unpredictable.

Ultimately, I try and come to the table with kind of a longer term perspective.

And over any measurable time period, I wouldn't bet against the innovation and the entrepreneurship

that underpins this economy.

And we've lived through a tremendous earnings renaissance that so it hasn't just been

fueled by things that you can't get that aren't measured.

There's lots of earnings.

There's lots of cash flow.

I mean, the magnificent seven are going to spend almost a trillion dollars this year on

R&D and CapEx.

That's just seven companies.

And that investment spending powers this economy and produces optionality on the future

that where the market's trading at 20 times earnings, I don't think it's pricing in a lot

of optionality on innovation.

Are you concerned that the market or are you concerned that you yourself in this sort

of scenario is depending too much on that CapEx actually coming to fruition, that there

might be an economy where or a market that doesn't appreciate and we're seeing this play

out right now, doesn't appreciate the tremendous amount of CapEx without the ROI.

Look, ultimately that investment spending needs to earn a reasonable rate of return.

I think over time that'll get proved out and I wouldn't bet against these companies from

allocating capital well.

What's been so surprising to me again this month on a maybe we close to a 10% draw down

from the peaks is the save assets haven't behaved well, bonds haven't behaved well,

max seven hasn't behaved well, gold hasn't behaved well, the only thing that's behaved

well is commodity prices and I started to wonder is it just possible that those that rely

on oil as a revenue source, the Gulf states for example, didn't have access to revenue

that were otherwise planning on having access to and did they sell the things that were

most liquid in the short term, gold, treasuries, max seven because I would think those asset

classes would be your safe hasn and on the stock side, those big companies have the most

flexibility, a small dial down on CapEx, a small dial down on R&D has a massive influence

on cash flows and earnings.

I do think when it comes to gold, I mean you had massive central bank buying, I think

at least Turkey has been a big seller of gold to protect its currency.

So it seems as if it has been a kind of rainy day asset and it started to rain.

It did, but I do wonder whether the Gulf states are going to be the same situation.

I need cash flow today that I can't get access to right now.

So even though commodity prices go up in the short term, there are short term implications

and these things, I think, get managed through over time and I'm thankful that Paul said

today that he's going to take a wait and see process.

We don't need the worries of a policy mistake on top of worries around when this war will

find its natural offer.

Charles, good to see you.

Thank you for coming by.

Charles Cantor, New Berger Berman.

President Trump today threatening further military action in Iran if it does not begin

to allow ships through the Strait of Hormuz, Aimen Javers is in Washington with the latest

Aimen.

Hey there, Melissa, we also heard from Caroline Levitt, the White House press secretary

today here at the White House and she's declined to say specifically what will happen if

we get to April 6 without a deal on the table in Iran saying she doesn't want to get

ahead of the president.

But she did say that Americans should trust the White House when it says negotiations

are happening rather than what you call the terrorist regime in Tehran, which says

that negotiations are not happening.

And she was also asked if the White House can trust those officials in Iran who they're

dealing with.

And here's what she had to say.

Well, that's part of the ongoing process that's taking place and the ongoing negotiations.

Of course, anything that they say to us privately will be tested and we will ensure that they

are being held accountable to their word and if they are not, the president has laid out

the military consequences that the Iranian regime will see if they don't hold true to

the words that we are hearing privately behind the scenes.

So Levitt there are alluding to private conversations behind the scenes and saying that the White

House is going to test any of the commitments made by the Iranian side before they trust

any of those commitments.

She was also asked about the timeline for the war.

She said right now in week five, we're sort of in that sweet spot in the four to six week

timeline that the administration laid out at the beginning of the war.

But this is an administration, guys, that really doesn't want to be pinned down on a specific

exit date.

Obviously, that would tie their hands militarily and diplomatically.

And so Levitt not eager to say, you know, the war is going to end this week or next week

or put any specific timetable for an exit on it.

Aimen, thank you.

Aimen, Jevers.

As a conflict, it expands our next guest as a U.S. strategic goals have become less clear

and continue to change, which has impacted ally support, joining us now as former defense

secretary.

Mark Asperr, Mark, great to have you with us.

Good to be with you, Melissa.

Thank you.

What is your view of the war as to when it can conclude today versus say five weeks ago

when it started?

Well, the United States continues to make great progress in terms of achieving its military

objectives.

And those have been cited several times with regard to destroying the Navy, destroying

the Air Force, ballistic and drone capabilities and production.

All those things are making progress.

But of course, the war will be resolved at the political level.

And at this point, it looks between negotiations of both sides.

Now, the United States has put forward a 15-point plan, which Iran has rejected, and Iran

has put forward a five-point plan, which the United States has objected to.

And if you look at them both, they're placed extreme demands on the other party.

So I guess we're going to see what happens come April 6th, whether one side seeds a little

bit yields, whether Iran opens up the straight-ahor moves.

But I think at that point in time, the President's going to have to decide, does he take another

step forward with regard to escalation on the military front?

And that could involve boots on the ground.

There was a report today that the administration was interested in going after the uranium

and actually extracting it from Iran.

And that would fit in with their goal of not allowing Iran to ever be capable of producing

a nuclear weapon.

How difficult do you think that would be, I mean, extracting 1,000 pounds of uranium can't

be easy?

Very difficult, Melissa, very difficult.

You'd have to go first of all, in the interior of Iran, into the interior of Iran, to the

two sites where we believe it's located, which is Natanz and Isfahan.

And you'd have to excavate it out, presumably.

You'd have to, meanwhile, have a large security force to protect those sites.

And then if you found the material, of course, it could be radioactive if it's been breached.

But I guess you're talking about several dozen canisters of highly enriched uranium.

So look, it's a very difficult mission, very dangerous, very complex that would take days

presumably to accomplish.

You'd have to have some means by which to land aircraft.

And then you'd do that all under pressure from Iranian ground forces.

So to me, that seems like a task too hard.

My argument has been, for a mission like that, the best way to get that uranium out of

Iran is through negotiations, not through a military force.

But look, it's something that we could plan on doing an attempt to do if need be.

But my thought would be the presence is going to try next maybe to go after launch sites

along the Strait of Hormuz, or maybe seize Carg Island, do something like that, which

is more achievable and less risky.

Look, what's your level of confidence that traffic to some degree can be restored to

the Strait of Hormuz, to the Persian Gulf shipping traffic, with things like naval escorts?

I mean, does that seem like it's just too heavy a lift?

There's reports today isn't going to happen particularly soon.

It's doable, Mike.

It's a mission of the United States Navy.

We've done it before in the past.

But you're talking about running a multi-mile gauntlet around the Strait of Hormuz where

you're subject to everything from sea mines, to missiles, to speedboats, to autonomous

boats, to drones.

I mean, the list goes on and on of things you have to defeat, and you have a very small

reaction time.

We're talking fewer than 10 seconds.

So if you're a US Navy ship, you want to put yourself in a harm's way like that and possibly

suffer more casually.

So there's a risk to doing so.

And I think at this point in time, again, the use of military forces, whether it would

be the Marines, for example, would be to go into the, the Iranian side of the Strait

and maybe clear out some of those areas where they are hiding those small boats, where they

are stashing the missile launchers, doing things like that.

But it would be a very risky operation and would be likely fraught with casualties.

Does the entrance of the Houthis into the war, does it make it more likely that this

is going to be a more protracted war than previously anticipated?

I think so.

I mean, they haven't done much other than fired missiles into Israel, but they could obviously

shut down part of the Red Sea if they wanted to.

That would add further stress on commercial traffic.

But I do see that as a tick-up in escalation.

At this point in time, it just doesn't seem like this is going to end anytime soon.

I think we've got a few more weeks to go here.

And again, in my mind, April 6th will be the, will be telling President Trump will have

to decide.

Does he, either Iran yields on something or they don't?

And then he has to decide, does he give them more time?

He's already extended their deadline twice, I believe, or does he apply military force

in some way to show the seriousness of his resolve in this conflict?

Mark great to speak with you.

Thank you.

Thank you both.

Mark Esper.

Coming up, Fetcher Powell says inflation is well anchored, but the people who make things,

they say prices are increases, increasing, plus we'll dive into why Cisco is plummeting

after announcing a major acquisition.

You're watching Close and Bell Over Time, live in the Nasak Market site.

Welcome back.

Shares of Cisco, the food company, sharply lower today.

It's biggest one-day drop in six years.

Company is paying $29 billion in cash to stock to acquire privately held Jettro Restaurant

Depot.

That price tag, nearly equal to the current market cap of Cisco, it will pay for the deal

mostly through new debt, which is perhaps one of the reasons that the stock was down 15

percent in, in addition to the size of the deal, maybe the valuation.

I think my first thought when I saw this is privately held family controlled food distribution

company would have been a really good fit theoretically with Berkshire Hathaway.

They love buying family controlled companies, they're cashing out, and they own McLean, which

is the food and grocery distributor to Walmart and elsewhere.

But who knows if they got a look at it or didn't, either way, it's kind of an interesting

one.

It sounds like they had been in talks in the past to do this deal, so this is maybe in

the office here.

And it also gets Cisco into a different area, local businesses, and it plans to expand

in that area and open hundreds of repressions.

And apparently a pretty unique business, right, like this sort of small restaurant cash

and carries.

Our executive producer, Sandy Cannell, loves the restaurant deeper, talks about buying

like, size of beef and such.

And just for himself, not just for himself.

I know, it's amazing, it's appetite.

Earlier, when we talked about comments from Fed Chair Powell, that inflation is quote,

well, anchored despite the oil shock, but our units, you and spoke to Chinese manufacturers

who say the oil price increase will force them to raise their prices.

Pickleball paddle producer, Debbie Wei, has a message for American shoppers.

Americans will have to pay more, he says.

Because of the swings in oil prices, the Chinese businessman has had to hike prices on

his paddles and pickle balls by as much as 20%.

I might have to go even higher, he says, maybe double if the Iran war doesn't stop soon.

Mr. Wei's goods are made from plastics that are derived from oil.

But the war in Iran has spalled shipments of oil and its products through the straight

of four moves.

And that's reason concerns among manufacturers here about a further disruption to the global

supply chain.

At this Beijing trade show, ballooning oil prices is the buzz.

James Lee, who sells a third of his scarves to the US, has marked up these ones by 5%.

This scarf is 30% polyester, he explains.

We will definitely pass on the extra cost to our customers.

Toymaker Wang Ming Ming is hoarding two months worth of PVC, a plastic polymer, but isn't

sure he can hold off charging more for his figurines.

In our industry, these materials are almost irreplaceable, he says.

If oil prices rise any further, we really won't be able to manage.

But perhaps the biggest worry is how costlier oil takes cash out of consumer pockets worldwide.

More money for gas means less for Wei's pickle balls.

Ordinary people are getting squeezed the most from the high oil price, he says.

Their spending power just isn't what it used to be.

And that poses a challenge for China's leaders, since the economy with its massive trade

surpluses has become more and more dependent on exports.

You know some curious, that was a trade show, so what is the lag time between those products

there and them talking about price increases and when it shows up in the US markets?

I think it really depends on what product you're talking about, because there are companies

that are able to ship things quite quickly, and then for others it takes several weeks.

But for the most part, the people who I was talking to there did believe that they were

going to have to raise prices, in fact many of them already had, as I said in that report,

anywhere between 5 to 20 percent.

Yep, we're already seeing it.

UNIS, great to see you, thank you, UNIS UNE.

With one trading day left in the first quarter, the S&P is down nearly 8 percent up next

to close.

You look at the market rotation and what could happen next, over time, if you're right

back.

Cheers, a Boston scientific following to a two-year low, the company presenting data for

a new implantable device for patients with atrial fibrillation or A-Fib, though the results

were mostly favorable compared to blood thinners on the market, analysts saying certain data

points within the study are causing concern.

Let's consider the markets at the charts now, Mike, and you're taking a look at roads

of returns in a few areas on the day.

Yes, they're kind of waxed and wane, but this whole broadening versus narrowing trade

is back again.

Take a look here, the equi-weight at S&P 500, this goes back to five months to the end

of October, is outperforming the market cap-weight at S&P by 8 percentage points.

Remember, this was the widest point in here that's right at the beginning of the Iraq war,

and then you had an unwind of that.

Now we're, we got narrow and now we're gapping out again.

So I don't know if it's a good thing that the average stock is again outperforming the

mega-caps, or is it just there's nowhere to hide?

In absolute terms, there's basically no shelter, but the mega-caps are the larger source

of weakness.

I don't know if that's going to erase, but that's okay.

Take a look here, stocks versus bonds, tomorrow's the end of the quarter, okay?

We often get asset allocators making rebalancing moves as we do get toward these quarter-end.

This is Ag is the bond index, so that's basically total bond index, VTI, total stock index.

In theory here, there's room for selling bonds to buy stocks.

Even though bonds have not really protected you very well, they've outperformed stocks.

So in theory, there should be maybe a little bit of a tidal shift potentially toward equities,

or maybe we've already seen it and didn't do any good in prices.

It'll be interesting to see as we sort of chug on at this sort of chipping away at the

markets, whether or not defense and defensive areas in the market are going to be re-evaluated.

Yeah.

Tech increasingly seen as more defensive as time goes on.

I mean, they're more immune from oil price shocks.

And as Charles had mentioned, just the idea that their capex is there, and that's going

to sort of bolt out.

It's funny.

It's there.

And you do wonder if it starts to get viewed as a source of savings.

And you can just cut back those budgets a little bit.

Or in fact, I mean, treasuries have charted to act like it just in the last day and a half.

People have decided that locking in 4.2% or 4.3% might be okay.

Yeah.

Well, March has been a month to forget for the markets, 8% losses for the major averages.

Many of the biggest names down even more will able to be timed to buy will be right back.

Well, welcome back to Closing Bell over time, live from the Nasdaq market site.

Stocks mostly lower today.

The Dow did manage a small gain.

The S&P 500 and Nasdaq both were down even after Morning Rally attempts.

The Russell hit hardest down 1.5% on the day.

We sort of continued undewind in the once hot AI related trades, memory, networking and

AI infrastructure names all down big, meta, however, gaining 2% after a rough week last

week.

Morgan Stanley calling the stock a top pick with a $775 share price target from saying sentiment

has troughed with the stock trading at 15 times forward earnings.

That's below its 10-year average.

So are there other names out there that may become cheap enough to buy in this downturn?

Our next guest is a few names on her radar.

She's been adding to during the sell-off.

Joining us now is Stephanie Lank.

She is high tower chief investment strategist, portfolio manager and a CNBC contributor.

You probably have seen her on the halftime report once or twice.

Stephanie, great to see you.

Great to be here.

Thanks, Melissa.

Does it matter how long this conflict goes on or are you just going to buy the dips

no matter what?

In other words, if you knew today that the conflict was going to be four months from now,

last beyond four to six weeks, would you be buying dips right now?

Well, I would.

I would be and I am looking for high quality, best in breed, number one or number two in

their respective industries.

Great management teams, good balance sheets, but most importantly, valuations.

And where do I think earnings have upside?

And so I have a bunch.

I have been adding.

I hope that this is a four to six week war time frame.

And if it is, I think we're going to get right back into the underlying economy that

is strong.

If it's longer, there's a lot more questions.

But I do think a year from now, I will be happy to buy some stocks that are well below

where the market is trading in terms of multiples.

So you are looking through, basically, and it looks like, I mean, at least one name

on your list.

Dicks, for instance, you say it's strong management team, great franchise, et cetera.

There's a possibility that the consumer could feel pressure, but that's not a concern

of yours right now.

It's really not because Dicks is really one of the only companies in this industry with

the dominant market share of 40%.

And I think that the Dicks business itself, it's hard to replicate.

And it's doing very well, it's coming.

It's gaining market share.

It's seeing operating margin expansion.

Same sort of sales at 3.1%, when everyone else is really struggling to do a positive

comp these days.

The issue with footlockers, excuse me, with Dicks' footlocker, footlocker has been a problem.

For years and years and years, but I think this past quarter that they just reported a

few weeks ago, they did show that they have depleted inventories.

They have a whole new concept.

They're revamping the stores, getting better brands in, more prestige names, and that

sort of thing.

And the prototypes that they've actually put out in these new stores, they've actually

yielded even higher, same store sales, initially on.

And so to me, 13 times earnings, 9 times e, but da, stock's down 4% for an industry leader.

It's pretty compelling.

Staff, we were talking earlier about how, obviously, banks had a rough run, but they've

kind of found their footing, the bigger ones, at least, in the last couple of weeks.

Why does Truist stand out to you in that group?

Well Mike, whenever you can buy a bank at below one time's book value, it's always pretty

good chances that you're going to make money.

It may take long, like we mentioned, the headlines are substantial right day to day, but I do

think at 0.9 times book value, or if you want to go PE, it's 10 times PE, with a 4.7% yield.

And this company has some new management, they're doing good things in terms of building

out their basic business, net interest income, capital markets, investment banking.

But I think really importantly, the whole BDC and the whole private credit concerns,

1% of their loan book, and at the same time, they are lowering their non-prime loans

in general.

So they're getting cleaner, they're getting smarter, and I think it's going to lead to

better profitability in the next several years.

By the way, they have excess capital, it's 26% of their market cap, and the buyback of

12 billion is 20% of their market cap.

So I feel pretty good over the long haul, we'll make some money in this one.

You do like, and you have added SNPS and Opses, and I'm just wondering, as you look

through software, there is a lot of wreckage there, and how do you determine which ones

will be immune from this drawdown, which seems to have hit everybody across the board?

Yeah, so the way I'm approaching it is mission critical software, and that's exactly what

Synopsis does, right?

It's electronic design automation.

The more complicated chips get, the more you need their software, and there's really

only two players, Cadence and Synopsis.

What I like about this company is, A, is trading at a massive discount, two Cadence at

26 times, not cheap, but certainly better than the 36 times that Cadence is trading at.

They have a 40% share, 70% recurring revenue, and they actually, it's kind of interesting,

you have activism in there, Elliot, we think it's something around two to and a half billion

dollars that they're investing in, Nvidia owns two billion dollars of this company, and

Synopsis itself is buying back two billion dollars of share, so the twos are really kind

of interesting to me, and of course they made the Ancest acquisition, and it's going to

be creative.

By the way, I think this company has a lot of pricing power, that they're not taking

yet, and in a duopoly, you can do that, and I think that's what Elliot wants them to

do, is actually increase their pricing, I think they should.

And Steph, on the kind of flip side of that, we were talking earlier about a lot of the

big longer term winners came in for heavy selling, did that included Broadcom, and

it's some of the more crowded or better owned chip names, you had lightened up there,

where do you see it now?

Yeah, I have been lightening up on the semis, Mike, because they've had such a nice

run, I mean I was buying Broadcom four years ago when it was trading at 14 times earnings,

it got as high as 40 times earnings, and then it's now at about 29 times, that's not

cheap, but the story has changed, obviously in custom A6, and they are the leader, and

they could do something like $16 to $18 in earnings power, that being said, I was up 75%

in the past year alone, so you had taking a little bit there, and adding to more software

names that have gotten beaten down, so Palo Alto is one, it's a very big position, I feel

like I buy it every day down, today was kind of nice, a service now is a fairly new position

for me, again these stocks have really deraded, and I think that there is upside, they're

going to be winners, and they're going to be losers in software, no question, but that's

why I think that you want to find the mission critical ones, and also just take some gains

along the way on the semiconductor space, I'll buy it back if it goes down a lot, but I think

it was prudent to do, Stephanie, great to see you, thanks, thank you, Stephanie Lank,

time for a scene we see news update with Angelica Peabulls, Angelica, hey Melissa, the attack on

a synagogue in Michigan earlier this month was a hisbola inspired act of terrorism, that's

according to the FBI who said Monday that the suspect intentionally targeted the state's

largest Jewish temple, officials said the suspect fatally shot himself after ramming a pickup

truck loaded with explosives into the synagogue while more than 100 children were inside, no

children or staff were injured, TSA agents are starting to receive some back pay today according

to the DHS and a union official, that payment comes as part of an emergency order signed by

President Trump on Friday, a congressional deal to fund TSA remains stalled in the House

representatives, and the WNBA is headed back to Houston, Tillman Fertita and the owner of the

NBA Houston Rockets has reached a deal to buy the Connecticut Sun, Fertita plans to relocate

the team to Houston for the 2027 season, and that deal paves the way for the franchise to

rebrand as the Houston comments one of the WNBA's original teams, guys back over to you.

All right, Angelica, thank you. Well, Nike has been the third worst stock in the

Dow over the last year, up next an analyst with a buy rating on that stock discusses what

she's expecting with Nike report earnings after the bill tomorrow and why she's still so bullish.

Nike shares are under pressure so far this year, tariffs demand uncertainty and ongoing

geopolitical risks are all laying on the stock, it has been the third worst performing name in

the Dow over the past year, the company sets up report earnings tomorrow after the bell, our next

guest is still bullish despite all the concerns upgrading the stock from equal weight to overweight

earlier this month. Joining us now is Adrian Yee of Barclays, good to see you. Thanks so much for

having me. So two, three weeks ago, you upgraded it, you kind of conceded, look, it feels like it's

a little unconventional or a little bit risky given the near term news flow, it's not been great,

but what are you expecting tomorrow? Yeah, so from a couple of weeks ago, the stock even still is

down about 10%. Now what we were expecting before the print, but a lot of the macro pressures on it.

Sure. So tomorrow after the print, we're expecting them to beat the quarter, right? So,

so Nike, this is the two quarters that they're actually going up with the reset actions from

last year, what they're anniversary in North America, that'll be the driver of the upside.

Now you've got the Middle East, right? They have about 3% or 4% exposure there, that'll weigh on

their fiscal fourth quarter, they have a very odd may year end. And then they don't give guidance,

right? So they don't give long term guidance, but they give color commentary on the, and they

have to say something, right? You can't just be guiding out to May and be like hands off.

And so we do expect the CFO to actually give kind of color commentary on the next 12 months.

And the big thing, the big risk here is downward revisions on the China segment, which is about

13% of the business. And it was a negative 16% last quarter. It's going to be a linear recovery.

It's a really slow recovery over there, and we're expecting FY27 to still be negative.

How delayed do you think the recovery could be, though, given energy that the price shock to the

Chinese consumer from higher oil prices is much steeper, obviously, than a price shock to U.S.

consumers? Yeah, so there's a couple of things going on there. The first thing they did is they're

doing a very similar reset, meaning exiting all of the classics. So the reset that they did in

North America last year, which was to get out of the big three, the Air Force one, the AJ one,

and the dunk were still existing in the China and the Asian market. They're exiting those.

So you're kind of getting a combination of I have the wrong product. I just defensively discovered

that I have this problem. This is very different than the offensive maneuver that they did in North

America, and then you have the unknown of the macro shock event that could be forthcoming.

What are the, I guess, leading indicators of whatever they're doing on the merchandising side,

on the innovation side, that either give you confidence or raise questions?

Yeah, so the underpinning of our overweight rating is North America. When the company actually

puts its innovation muscle, remember, their demand creation is about 10% of 4.5 billion,

right? That eclipse is their two biggest competitors total sales. Tell me you can't do something

with that. So really it's the underpinning of the North America turnaround, which is about 45%

of the business. And when they actually set out to do the innovation in the run, they actually

in the last quarter, they delivered results in performance run. They had strong double digit growth

in the North America in all channels. The other thing that we're looking for is clean inventory.

And that clean inventory existed in the last quarter for North America. That helps support

the gross margin inflection, which is really, to me, gross profit is the single biggest important

number on that PNL. And we actually saw that in the last quarter. So continuation of cleaning

the channel. And then the last point I'll make is there is a channel stuffing narrative out there

on North America. And if I'm believing that half the business has turned and they're stuffing

the channel, we're going to loop right back into our problem if they are. Whole sale is up 24%

and so the magic number to watch tomorrow is North America whole sale. If that number is over

15%, the stock is going under 50. If that number is in the single digit, the stock gets support

and people are buying that. Adrian, thanks for breaking it down. Thank you so much. Adrian, you

bark least. Well, Nike, maybe tomorrow's big highlight, but there are plenty of other earnings

and economic data you need to have on your radar. That is next. As we had to break,

check out some notable names hitting new highs in today's trading, Chevron, Exxon mobile,

Semper Energy, fertilizer, giant CF industries, and agricultural company Corteva,

closing bell over time, live in the Nasdaq markets, I'll be right back.

Welcome back to overtime. Investors slamming the brakes on chairs of Avis budget, which has been

on a huge tear from recent chaos at airports, but it seems like investors are taking some profits

now that security wait times are significantly easing despite today's decline. Avis is still

up more than 30% since last Monday. Remember when that was going wild in the pandemic and

if you realized it's in the Dow transports, which is always a little bit of a surprise to me.

All right, let's get you set up with tomorrow's trade today. As we mentioned earlier, Nike is the

big name on the earnings calendar, but we'll also get results from PVH, McCormick, as well as

Dave and Buster's, and on the economic front. We'll get the January case-shiller home price index,

the jobs openings and labor turnover survey, and the market consumer confidence report.

Joltz, I always find it interesting even though it's a one-month lag and it doesn't directly

feed into the jobs number which we do get on Friday. Right, special session on Friday.

The earnings picture that will be painted, it will be interesting because they are all

read on the consumer in various ways, so that'll be very key to watch. Exactly.

Some of the first companies that are going to have anything to say during this multi-week period when

most companies have been kind of quiet in the face of this crisis. All right, that does it

for over time today. Fast money begins right after this quick break.