dks -- >> oh, my gosh. >> what they've done since 2019 on margins and outpacing retail sales in general. >> absolutely. we started to re-invent the company, ed sachs said. we look different now than we did, and it's all sort of been to their favor. >> we'll look for ulta and adobe. let's get to the judge and "the half." carl, thanks so much. welcome to "the halftime report." i'm scott wapner. front and center this hour, the rally's next leg. where it might come from if the nvidias of the world do take an extended breather. the investment committee tackling that key question and making more new moves. joining me, josh brown, jenny harrington, bill baruch and brenda vingiella is back. let's check the markets. we are in the red as you see across the board. the data obviously did not go really in the direction of the bulls, but it hasn't upset the story in a great way either as you have ppi was slightly

hotter. retail sales lighter. jobless claims lighter, too. you have yields moving up. take a look at the ten year, was 4.26. nvidia is lower. tesla is lower again down 5% this week. the worst s&p stock year to date. so we're watching all of that. the point being, as i turn to josh brown, you say it's not the place to look anyway, if you're thinking about where this next leg of the rally will come from, if you do believe one is in the offing, you say it will come from the small caps and that's where you are zeroed in for us today. >> small caps and value and cyclical. really, anything but tech is the beneficiary. they're going to keep using the companies atm witness, not because there's anything wrong fundamentally with the stories amongst the largest technology companies, but because they've all been overbought for a very long time, people have chased, and there are other places to be, and, you know, professionals who have been in the market for a long time, they understand the need to have other names on your screen.

i do talk to young people. i speak with investment clubs. what i find over the last year and a half, two years, is these kids don't know anything other than tech, and i understand it, those have been the most exciting stories to watch, and that's what we talk about on tv all the time. if you say to them, hey look, the rotation is under way, and right now it's energy, they wouldn't know where to begin. that's understandable. but people who have been doing this for a long time are diversified and are seeing other areas of their portfolio start to work. i want to have fun with rsis really quickly. jenny is jumping out of her seat to get in. let me do this really quickly. the russell 2000 has an average rsi, relative strength reading, of 52. that's the highest since last march. we haven't seen this many uptrending small caps in a year. there's a lot of money being made in that space. now you go ahead and look at the whole s&p 500. where is the relative strength? there are almost no technology names in the top 20.

there's just one. everything else is energy, and then when you look at the average rsi within energy, it's 68. these are uptrending rallying stocks. people need to look elsewhere. i continue to say that. i don't know for how long this period will last, but it could go on for months and months and months. time to learn a new trick. >> jenny, renaissance macro today says they love the breakout in the russell after the golden cross. it's still a laggard on a relative basis. they suggest it's confirming breadth, and it is starting to broaden out as josh would suggest. i would only throw out the problem, question mark, with this trade is higher interest rates. and you can see it today. rates go up, russell goes down. pretty big correlation there, right? the russell is down 1 2/3 percent today. if it will be the hardest and rates will remain elevated, perhaps higher for longer, not

necessarily more hikes, but just where we are for a longer period of time, then maybe those stocks aren't going to work. >> i think they are, but that last mile being the hardest, what we know is josh's point exactly. it is so rare that you and i agree that completely. >> no, i know. >> it's awesome. when josh said anything but tech, that's been my entire investment theme this whole year. anything but the top ten, small cap, mid, value, international, go wherever. if the last mile is the hardest, and it will take longer to get there, i think what that does is give us a little bit of a gift, which is to say, it's going to take you a long time to get there. and in that period, you can start to sift through the rubble, the small cap index, the value, and you can pick out the stocks that will do well. it gives you the time to actually step back and do the research and dive in and say, okay, let's look at the point debt ladder of this company. what are the actual maturities? what are the actual interest rates issued, on the actual

bonds. what are the new rates going to be? even though it's going to take longer than we might want, scott, it's there. the numbers are there. the numbers are so compelling. the growth portfolio, the dividend portfolio, and what you see are p/e of 18 times and earnings of, like, 17 times, 20 times, 30 times on stocks. that's where i want to be going forward. >> we've been talking about quality and momentum both work ing well, and a whole bunch of different sectors beyond tech, industrials, hotels and things of the like. industrials, financials, too. i look at things like, you know, from the s&p small cap 600, which you have pretty good exposure to. there are stocks not playing in the same pool that a lot of these other stocks have been.

they're afraid to take off the swimmies. >> the stocks that you have up on the screen -- >> i'm talking b&g food, 34%. albany international, 8. josh's shake shack is only 3.5% off. >> those 52-week highs set between may and august of last year. the 52-week high was may of 2023. shake shack, i think, was august. you look at those, okay. we've done a lot of work. they're down a lot. they've consolidated. and so josh's theme on small cap has been a 2024 theme. the starting point is now. if you look at those stocks on a year-to-date basis, you have b&g foods up, kohl's is down 11%.

i don't know what shake shack is year to date. >> it's up big, jenny. >> it must be because i'm eating a lot of it with that new york community i had to eat some burgers to make it go away. starting now in 2024, things are starting to change. >> let's just rip the band ate off. you sold it, you're out. >> now we're out. that's it. >> mnuchin is about to merge with tiktok. how could you sell it? >> haha. >> i read that somewhere. >> it's the discipline of the strategy. the strategy has an objective, once they violate that, you don't have a choice. i said, i have to sell it. the investment thee sus is debunked. what i could do now is see what steen mnuchin is going to do.

for this moment in time, it has to be out of the income equity strategy. >> brenda, you do own the etf, what is your view on small caps, continued broadening to the real laggards of this market. >> i think i'm going to disagree with jenny for a minute. i think don't we will have time when the time comes. the fourth quarter was an excellent example how fast the shifts can happen. so our strategy has not been to be overweight small cap but we still think there's higher quality. it has acted similarly to small cap.

we think that part of the market should act better and it's encouraging to see it is starting already. >> you make a good point, and i'm glad you made it. why did small caps outperform in that period of time? the market was anticipating much fas faster rate cuts. if that has changed, i've had people suggest to me, and i said this to josh yesterday on "closing bell," can't buy small caps until you get rate cuts. there's no reliability in that trade. >> who said that. >> you have to be ahead of it. it's going to skyrocket. >> brenda is right. >> this is the first time i've ever heard that on wall street. >> buy after the news is the strategy?

>> small caps underperform when there is extreme concentration. the '80s was exxon, at&t, kodak, like an alligator jaw. you have the concentration in the large caps and the small caps underperform. when that happens to the degree it has, you can get an outperformance from small caps. we own ijr in our broad portfolio, a sleeve of passive etfs, and we have one-third to cover 15% of an entire portfolio. ijr is one-third of that passive sleeve. i believe we're going to start to see that. now am i sitting there trading it? i rotate a little bit but i think it's something you have to tuck away here and it's about 5% of our entire portfolio and it's going to be there when you need it. now within the small caps, there's been tremendous outperformance for quite a while. industrials continue to break out. the head winds have been in banking. maybe we've had that cleanse now. i am still a believer that rates are not going to just continue

to rise. i think we're sort of finding a point of balance, per se, and i think the small cap banks, the regional banks, they're going to have a chance here to start to outperform. biotech -- >> what gives you the confidence that the regional banks are going to start to outperform? you can't just say it, i want to you back that up. the movement within those stocks would suggest otherwise. so tell me why you make that statement. >> i think from a positioning standpoint, we're starting to see that cleanse out. we've had new york community bank. we've had others going back to last year. now there is going to be regional banks carrying skeletons in their closet. and we don't own any regional banks from my perspective of how i can manage myportfolios, i will not take that risk right now and it's not my strength. >> i mean -- >> i'll give you the answer. they cut rates at the front end. you get a steepening, and it's likely commercial real estate is

in the process of bottom if not this quarter, next quarter. apollo is saying it's bottomed. so if you get that combination of less fear about the commercial property market to which regionals are highly exposed, plus you get some relief on the rates front, that's why regional banks bottom. they're not better businesses the next day. they just get a little bit of a rerate because of the fear of coming out of the market. >> my bigger point, though, if it's so obvious to buy the russell now, as you sort of suggest -- >> judge, people will fight you tooth and nail on this concept because they're investing in the rear-view mirror. they'll cite a million reasons why the russell is not working, and it's like, all right, but something is changing technically. so you either believe that the technicals lead the fundamentals and the market is smarter than the economists or you don't. i happen to believe that. the market is smarter.

>> to brenda's point, in the prior breakout of the small caps, of the russell, if you would have believed then that you were going to be at the cusp of a larger move in the russell, you would have been proven wrong. you would have been early by a lot because that trade fizzled and it went back to large cap stocks. >> good point. are we investing or trading? i always come back to this on the show because it's really important to know which one you are. if you are investing, you could be early. >> i am both. i think there's a lot-- there are days where the russell 2000 is going to rip 2% or 3% and as a trader what i do my commodity funds, i try to capture that. as an investor in my wealth portfolio for clients, we tuck away a 5% holding of ijr. >> we're leaving $5 trillion of mid caps, which also look outstanding. this is not a binary conversation. do i buy apple or do i go on the pink sheet? there's a lot in between and i don't think most investors start

off with the premise of, okay, what are the smallest stocks. >> hold on, jenny. real quick, the mid cap stocks are actually the ones that have been moving. >> yes. >> both outperforming on a one-month basis and year to date -- >> pharma, home builders. 100%. industrials. this is where, i think, this is where diversified portfolios really shine. if you get this malaise at the top of the market cap distribution that goes on for a quarter, two quarters, i know it's unthinkable, but, god forbid, the mag seven, stop making new highs for a few months, if that happens, that doesn't mean your portfolio has to go to leep. there are a lot of stocks making new highs on a daily basis, and not just small and mid. the bottom 200 of the s&p 500, it's littered with 52-week and all-time highs. every sector maybe other than utilities. >> let's do another jenny move. you sold toyota. >> right. >> talk to me.

why? >> it was paired up. this is in our international income strategy. we sold toyota with a 2.5% dividend yield. we bought mercedes trading with a six times multiple and a 7.5% yield. it's interesting if you look at toyota, a huge beneficiary of the hybrid, the ev, but they've been a huge beneficiary of a lower yen which has really improved earnings in sales. you take that and you step back and look at the ev world and up nope they are more expensive to make. you know what, i think the luxury makers will handle the ev transition better. it's easier to pass on the costs, the increased costs when you're selling an $80,000 vehicle versus a $25,000 vehicle. you have the totally divergent similar companies that they both are autos, divergent geographies, and so then you also can see that further putting the wind at the back of mercedes, rate cuts and stabilizing european economy. it's a pretty easy trade.

that was simple, decent portfolio management. >> the other portfolio management that we have reverts back to the opposite of what we've been discussing in terms of small caps and mid caps and that's back to the momentum trades taking a breather like nvidia, for example. who knows about meta, but you've trimmed both nvidia and meta. you're joining what is now a growing and long list of those who come on the program here and say, i took some off the top of nvidia. talk to me. >> last friday for the majority of our clients, we trimmed both nvidia and meta. nothing has changed for either company. it's recognizing the hype in the numbers and especially if we look at nvidia, the earnings' outperformance has been phenomenal. what our concern is what if nvidia reports an n-line quarter and even if we look at the concentration -- >> the nerve. can you imagine? >> if we look at the

concentration of what's been driving the business, it's estimated that 19% of revenue is coming from one customer over the last year. i still think fundamentals are great but it's worth while to trim some. meta, same story. a phenomenal change from a management style and focusing on profitability, tremendous job. earnings are increasing. the multiple has increased, too, and some of that is warranted. but when we look at what's happened the stock is up almost 200%, taking some off the top and recognizing that there are other opportunities out there. >> josh, the target today goes to $1,000 at web bush up from 850. when the target gets run over, you raise it. that's how it's been. bernstein says you should still be be in nvidia. inflecting higher and surprisingly attractive valuation. they're not naive to where the valuation has come, but they consider it attractive. by the way, monday/tuesday next week, you have the festival that nvidia is having, so it's

interesting to see the movement in the stock ahead of a big event for that company. >> so i was sitting with a trader from one of the biggest banks who sits in the middle of a lot of flow, and the conversation was really not -- is nvidia fundamentally so strong and going to remain strong this year? how many years of demand have been pulled forward because, clearly, like the acceleration we've seen in margins, a typical company isn't able to triple their revenue and have margins go from 20% to 50%. that's not how economics work. we know it's an extraordinary story but are they now selling units that ordinarily they would have been selling in calendar '26 and '27 because, basically, if you don't have the gpus, you can't build anything, and if you can't build anything, you might as well be out of business in the tech world? that mentality of buy something

now or going to the next name on the list and you're basically out of the ai race, okay, that's awesome. we're all having a lot of fun in the stocks because of that. how long can that persist and how many years worth of demand are being pulled forward? to me that is the only debate worth having on nvidia. no one's debating the vstrength the brand, et cetera, et cetera. that's it. are we now pricing in three years from now into this current quarter? i don't think that's sustainable, quite frankly. and i'm saying this as a long. >> no, i know. very long. it's one of your largest. you're in meta. maybe we don't spend enough time talking about meta and the extraordinary -- >> is meta their second biggest customer, by the way? >> i think so. >> meta goes from its worst year in '22 to best in '23. >> it's the point josh made at the beginning of the show, these are used as atms and there's not anything wrong with the company.

you've gone from a 3% position to a 9% position. you just take some off and how fantastic. >> you remember how bad meta was as a stock, people crying about it at its low, is tesla setting up to be the next meta? it's now in a drawdown from its high. >> it's down 7%. >> meta was trading at 16 times earnings. trading at 16 times earnings, 29% earnings growth. that's complete -- >> it's also a 70% drawdown. >> but here is the other thing, too, the barriers to entry at meta are far greater than at tesla. look at byd, rivian, the comments i made on evs and toyota. >> jenny, those are penny

stocks. >> it's true by comparison. >> no, no, no. >> it competes with tiktok. >> you can't consider rivian a real competitor to tesla. >> everyone can make an ev. everyone is making an ev. >> it's coming from china. that's the issue. >> the repurposing of manufacturing in mexico potentially. have you seen the mexican peso recently? not to get off track, but it is going straight up, because of what can take place in mexico from a building standpoint. >> you don't own tesla? >> i do. >> you do? >> we entered after earnings. >> at 160. >> not yet. 160 is my level. now some people would criticize me. no, as a manager i would trim the position on a close, on a weekly close below 160, and that's a breakdown level for me. i would be watching it closely and as a trader i have no problem putting the position back on once i feel more comfortable even if it's at 180

again and it's sized properly. that's the key here for people sitting here with the main position, the centerpiece of an entire portfolio for the viewers. you have to manage your risk. for us it's in the bottom half of the portfolio and i like it from a value, not a balance sheet value but where it's been technically and what i see going forward. >> you like the technicals in it right now? >> there's a descending trend line that is 160, and it's bounced off, if it can perform that, plus about a year ago it was bottoming at that range. volume has traded in that 160 range. i need to see a response. >> i think it's interesting when you're talking small cam from a technical perspective and i'm talking about from a fundamental perspective where i'm finding lots of value and compelling opportunity when i'm looking at multiples and valuations and the stories. but on tesla, it's interesting. it gets from you a technical perspective. i think it's nearly impossible to make an argument even at 160 that tesla is compelling.

the math just doesn't work. >> humanoid robots, jenny. >> you know what i heard this morning on the radio, listening to cnbc driving in, what if he starts creating those outside of tesla? so much of that valuation -- >> i was just joking. >> it's real. so much of that valuation at tesla is on the hope that they do things like that and he could easily spin that off. >> right now it's priced as a car stock, an automobile stock. >> no, it's not. >> that's why it's dropping. >> not even close. >> before when it was trading 200 plus and pushing to $300, it was a software stock. i think it has the software attributes and that's why we're in it. i like what it has from an ev standpoint but that's not the main reason we're in it. >> to be clear, if it were priced like an auto company, it would be down 90%. >> 45 times revenue. >> that's why it's going straight down. >> it should go straighter. >> streaking stocks. we do have a handful of committee names on big runs over the past few sessions. we'll find out how the desk is trading the moves next. >> announcer: are you following

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if you've ever grilled, you know you can count on propane to make everything great. but did you know propane also powers school buses that produce lower emissions that lead to higher test scores? or that propane can cut your energy costs at home? it powers big jobs and small ones too. from hospitals to hospitality, people rely on propane-an energy source that's affordable, plentiful, and environmentally friendly for everyone. get the facts at propane.com/now. welcome back. we're going to trade some stocks that have been streaking of late. >> yeah. >> jpmorgan, that's yours. it's been on a four-day winning streak.

it may be down now but it's been on a run, around a new high this is a standout from that space. >> this is one of the best looking stocks right now amongst large cap names, non-tech large cap names this is a breakout. it's three consecutive higher lows. that's what we're looking for. the psychology behind the higher low is even when the stock sells off, it doesn't sell off to as low as it had sold off the prior time. what that tells you, the buyers are coming in faster and faster and faster. you have three of those in place. now it's about 12% above its former all-time high which was set at the top of the last bull market back in october of 2021. i've talked about the ipo calendar coming back. i walk past 47th street and park avenue this morning, they were building their own debt star. my president, jamie dimon, will sit on the iron throne, on the top floor of that death star. i'm a proud shareholder.

i love every which way jpmorgan is positioned for what's to come in the economy. >> i saw your insta post on that. very impressive. docusign, jenny, had been on a six-day win streak. what do we think of this stock? >> i thought you were coming to 3m. >> do you want me to come back to you? >> yeah, can you? >> game shows where you don't have an answer. >> kevin is so horrified. >> docusign was on the script, right? right there. >> it was. >> southern copper. bill, save jenny and talk about southern copper so she can talk when you're done. >> talk about a monster move this thing broke out to record highs. we added to it, talked quickly on the show, popped on for it. we added to it in january a. new position in the autumn of last year. i'm a big believer that southern copper is really one of the best -- not just in the copper mining space but across the entire mining space, one of the best-run companies. the catalyst was china, cutting

production, which takes the material. copper, which issing going to be high demand, it's now going to be less supply and because the raw material has less supply, so this cutting is the catalyst and it wasn't only a buy the rumor, sell the type of news move here. >> i'm ready. >> go ahead. >> sorry about that. >> it's all good. >> docusign, and i forgot their earnings -- >> when theydo the family feud, if you pass and you still get to answer within the time, you still win. >> thank you. >> so you passed and i'm coming back to you. >> this is the nicest you've been to me and i appreciate it. >> please. >> they were really good, 76 cents, expecting 64 cents. 8% revenue growth. it's trading -- this goes to the point of broadening out trading at 17 times earnings as a 7% free cash flow yield. we were worried going into earnings what they were going to say. because we've heard a lot less malaise from the activists that were in there for a while. going into earnings the stock plateaued and backed off. why aren't we hearing about the activists? are bad things going on?

the business was fine. the stock lifted from there. >> okay. let's do waste management. on a four-day win streak, brenda. >> it's a sleeper. waste management has been a great stock over the long term, and i think if you look, they have a huge moat. this is not a business easy to get into or to deal with the regulatory environment. on top of that, this is a company focusing on automation. and that has really contributed to really nice margin improvement especially more recently. i think that is primarily the reason it's acting even better. it has been a great stock over the long term. >> you want to do 3m? are you good with that? >> totally ready. >> a five-day win streak. >> 3m is going streaking. up 11% in the last month, and the reason being there's stabilizing and clarifying things finally coming out. they've announced precisely when they're spinning off their health care business. the ticker will be solv. they announced a new ceo. really well regarded, bill

brown, so that's positive. and then they were at the jpmorgan conference and guided q1 earnings up. said revenues are in line. we're seeing real stability there. the cash flow, the consistency is just fine. but between the lawsuits, there's been so much ambiguity. when that lifts, we move up. >> bill, what about target? it's been on a losing streak. >> the sixth down day in a row. a week ago it crushed earnings, up 12%, consolidating down p.m. i think the story from 2023 was playing out as the inventory glut got cleaned out. producer prices started to pick back up. i think they're in a good position as restocking at lower prices and keeping their sale price at the same level it was. >> bertha coombs will give us the headlines now. new jersey senator bob menendez is considering a run for re-election in november as an independent according to nbc

news. the democratic senator is currently facing 18 federal counts in a bribery case where he allegedly used his political influence after receiving gifts including cash and gold bars. the senator's term is up in january. vermont senator bernie sanders, will hold a hearing today on a bill that pushes the u.s. workweek to four days. the 32-hour workweek act would gradually reduce the workweek over four years without impacting pay or benefits. sanders says that americans are working for longer with less pay despite being far more productive than in the past. and a piece of history from the development of the atomic bomb has sold at auction. according to boston-based rr auction, a report signed by robert oppenheimer and members of the manhattan project, went for just over $50,000. meantime, the movie has grossed about a billion dollars, scott. over to you. >> big winner for the home team,

too. behathk u.rt, anyo coming up, your energy playbook. it's the best performing sector this month. crude oil back above $80. lots of ownership on the desk. whoo! ♪♪ these guys are intense. we got nothing to worry about. with e*trade from morgan stanley, we're ready for whatever gets served up. dude, you gotta work on your trash talk. i'd rather work on saving for retirement. or college, since you like to get schooled. that's a pretty good burn, right? got him. good game. thanks for coming to our clinic, first one's free. why choose a sleep number smart bed? can i make my side softer? thanks for coming to our clinic, i like my side firmer. sleep number does that. the queen sleep number c4 smart bed is only $1,599, save $300. shop now at sleepnumber.com

talking energy because crude oil is above 80 bucks. the best sector in march. phillips 66, bill baruch, all-time high. marathon petroleum, all-time high as well. you own that. we've talked about valero, exxon mobil and conoco phillips doing well. piper sandler says they are positioned for compounding success. >> we're 10% to 15% energy in our portfolio, throttling back and forth. >> that's a lot. >> we've been as high as 20 in 2022. we got as low as 7 last year. we're starting to throttle back in there. refining margins have been on a tear since the end of last year. that's a certainty piece on why you see marathon and phillips 66 and can you make new highs. crude oil is out above $80. there's the news yesterday from the weekly inventory, but you also have what is a positioning standpoint in crude oil. in the april futures contract expiring right now, options

expire tomorrow. we break out after range, it's a positioning thing and we are getting a directional move. china wakes up a bit. it will be a tail wind for energy. >> i agree. i mentioned the rsis in the space. you look at the names in the xle, they're all moving higher. if we go out with the xle positive that would be the fifth consecutive week. we haven't seen a stretch like that in a really long time. it doesn't necessarily mean you have more gains coming, but historically a pretty good sign. this sector tends to be streaky. i think if you are not looking here, not focused at all, this is your wake-up call. >> why do you like it better than the xle? >> i think the xle is a little bit too slow for my taste if you really think the sector is going to kick in.

they're smaller, less dividend oriented. that's not really what the shareholder base is looking for. if you're a believer there's upside in the space, more bang for your buck. >> you're not really getting that umph. >> they should both work. do you want the beta? you're not overweighting exxon. >> i like playing it a different pay. >> you don't like lng at less than $2? i like playing the midstream side of it better. i don't need to worry about lng at $2. >> they do move with the prices. >> barely at all. >> remember 2016, they all went to single digits. >> you shouldn't refer back to

that. what happened in the midstream space then, this is like a history lesson, maybe we should have an off line on this, '08 to '16 when there was a chase for yield, they exploded from a couple dozen to several dozen -- >> i was there. >> what you have now are the actual pipelines, like enterprise, energy transfer. those guys just transport the fuel. if you look now versus the prices of oil and natural gas -- >> more stable. >> when you have a market moving, it doesn't stop until there's a capitulation. i like cheniere. it's a holding of ours. it may be throw out the baby with the bath water. it's in the bottom five right now. i want to add to it once we get that capitulation. >> brenda has both. >> the show is an hour. >> brenda? >> we have cheniere and chevron. we don't have a huge commitment to the energy space. from our perspective, chevron

hasn't acted as well. it's had operational problems. but when you look at the amount of cash being returned to shareholders, it should be around a 10% yield. in our mind, that's attractive. it's going to continue. they're well positioned, one of the lowest cost producers in the world. not reacting today. maybe it will after that capitulation. >> proceed. >> thank you, thank you. i don't like needing to hinge on these things. that's what keeps me up at night. you can have things like williams, kinder, one oak, energy transfer. the yields are between 5% and 9%. every ten years or so without needing to stay up worrying about it. i think -- >> you do the k1s for your clients? >> thank you so much for asking. you might have noticed some of those are midstream things that are incorporated as a c-corp, no

k-1s. if they want the tax defrerral. >> don't mention 2016 again. >> you'll get a history lesson. >> that's my takeaway. coming up, "calls of the day." we'll trade them next. kip the counter... and choose any car in the aisle... even manage your rental right from the app. so you can give some quality time to a quality cause. swing by to see one more customer... [audience cheering] and really get down to business. go national. go like a pro.

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and have historically low risk. call today to request your free bond guide. 1-800-217-3217. that's 1-800-217-3217. all right. welcome back. let's do our "calls of the day." caterpillar, which you own, bill baruch, new all-time high today. it's one of those stocks we've been talking about in a group of large cap stocks that have been hitting new highs. this is the nvidia of earth moving equipment, obviously. what's your take? >> earth moving equipment goes into minls. we're seeing the move in copper.

a great tail wind to caterpillar, tremendous exposure there. i mean, one of my stories, my themes, increasing caterpillar, i do believe the inflation reduction act and the money tied to it is not going to go to the middle part of this year, another tail wind for caterpillar. >> i was only kidding about the comment. you never know. ibm, price target raised. jenny, you own that. >> one, we're seeing a real narrative change at ibm. for so long it was like sleepy black box. no one knew what was going on. nothing happening there. we've really seen the shift towards the ai conversation. but, really, my investment thesis has been based on big data, cloud scale. what i think is interesting about this upgrade, it's not an increase in earnings. it's just the analysts giving them one multiple point taking it from a 17 times multiple to an 18 times. i think expanding the multiple is fair. 220 sounds good to me. >> bill baruch, you sold rtx in

november. the stock got upgraded to overweight from equal. price target from $100 over two years we think the stock could hit 160 they say. >> it had fallen out really hard, july and then again it got tanked with bad earnings. we had the engine defect and with what's been going on with boeing and just following the stock forever, going back, i wanted to get out of it. i used the money to buy more caterpillar. it's definitely on my radar coming out of this now and it's a stock i've loved for many years. if they can put that news and the bad news behind them, which they have. there is upside. $100 should be reachable. >> what about chubb, brenda. you said you sold it too early. all-time high yesterday. back to 93. price target raised to $275 at k citi. it did get downgraded. >> we sold this in june and replaced it with auto desk.

if we look at all the insurance companies out there, they've benefited from a year where they've been able to raise premiums in many cases pretty substantially and that has contributed to a lot of growth. i just don't think that's repeatable going forward. i agree that probably taking some off for anybody who owns it would make sense. >> also taking off some nick chubb. i don't know if he will start the season. >> i don't know who that is. >> a second surgery in november and they're pulling more running backs on the team. a little concern in cleveland. >> in free agency, too. >> back to you, judge. >> thank you very much. mike santoli is next. [phone: starting route.]

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senior markets commentator mike santoli joins us now with his "midday word." after ppi, i guess we're turning our attention to powell midweek. >> yeah, for sure. the initial attention has to be on the bond market reaction to ppi as the second or depending on how you count it, the third

hotter than expected inflation report. scott, i've been talking about giving the market credit for being able to protect itself through rotation over this period. the last couple weeks have thought and said that there's a lot to ask for that choreography to be perfect and completely hold the index harmless working on the sixth down s&p mark day. it is happening at a time you probably need to cool off sentiment and positioning. you have another couple percent down, still at the 20-day average, not a big deal. i do think you have to be alert for the idea that it changes the story enough on the yield front. maybe just higher metabolism economy we have to get used to and all that implies about asset values. >> i think we're at the highs of the day or thereabouts in terms of the yield on the ten-year note. one thing we definitely can't afford if you're bullish this market is any suggestion by powell next week or, frankly, anybody else, that you have to

start thinking of the possibility of another hike. i know as foreign as that sounds to people, still today people will be talking about that. >> probably some people will. i think there's just a huge distance between the published forecast of three cuts this year and then dialing that all the way up to a potential hike. maybe somebody in the committee does, and it's going to be the median will move. who knows. i don't think there's been a great cost for powell to keep deferring the timing of the potential first cut, but, yeah, it gets trickier to try to figure out exactly where we are here especially when it seems as if in most measured ways the economy is not struggling with rates at this level, though i do think you have to look at things like decelerating labor demand and consumer spending. >> if anythi ingt complicates the window, whatever window exists with the election and the distance, too. i'll see you on "closing bell." no wonder more than 9 out of 10 of our clients are likely to recommend us. ameriprise financial.

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we're back with "the setup" ahead of earnings in overtime. we have ourselves some adobe, bill. what do we think here? this is an important stock in an important space at an important moment. >> it was a top five holding. we did trim it a little bit, about a month or two ago on the news that on openai release and adobe was down 7.5%. the creative cloud, the price increase, a full quarter, what type of momentum they have from firefly and then what type of response after the termination

of the figma agreement there. >> got somebody real quick? >> i think the big story is they give conservative guidance this quarter, last quarter, and i think the market took that and su ag with the other competitive isesnd said, oh, there is competition coming, business might be slowing. i don't think that's really the case. we'll get more clarity on that tonight. >> yes, we will. we'll do "final trades" after this break. power e*trade's award-winning trading app makes trading easier. with its customizable options chain, easy-to-use tools and paper trading to help sharpen your skills, you can stay on top of the market from wherever you are.

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(christina) with verizon business unlimited, i get 5g, truly unlimited data, and unlimited hotspot data. but it can be passed on to the next generation. so, no matter what, i'm running this kitchen. (vo) make the switch. it's your business. it's your verizon. i hope you'll join me on "closing bell." a good time to catch up about the tech trade, bank of america, i hope to see you all then. final trades. you want to talk live nation? >> i do. the stock is 103. the highest level was 98. the stock looks really good. i think this summer another big

summer of shows. you'll hear about olivia rod rego, about luke combs, drake, et cetera. >> bren? >> estee lauder. things are troughing, new focus on innovation. >> alphabet, love when things are out of favor. >> supporting bills bank stocks. >> good stuff. i'll see you on "closing bell." "the exchange" begins right now. indeed it does, scott. thank you very much. welcome, everybody, to "the exchange." i'm tyler mathisen. inflation is sticky. the labor market showing signs of resilience and the consumer is still spending. the market sees the fed's first rate cut in june, three maybe for the year. one former new york fed analyst thinks that may be an overestimate. he'll tell us why. the so-called tiktok bill now on its way over to the senate. will the senate take it up or