coast for another major launch with elon musk's other company, spacex they're doing a big test with nasa, so keep an eye on that one into the weekend as well. >> so a busy evening for elon musk tesla stock has been halted. that does it for "closing bell." "fast money" starts right now. live from the nasdaq market site overlooking new york city's times square, i 'm melissa lee tonight on "fast" tesla shares halted it's suspending orders ahead of news that elon musk tweeted is coming at any moment now we've got phil lebeau standing by to break down the headlines as soon as they catch. health care catching a cold going from the best performing sector last year to the worst this year. a top technician says there is one name in the group that's a screaming buy. first we start off with the year of the china bull so forget about the pig this year, the shanghai up 18% in

2019 the best two-month start to a year since 2000. this as trade tensions are easing despite weak economic data that continues to roll in will the shanghai surge give the rally here in the u.s. some more fuel to run, guy >> two-part question >> can you handle it >> i can because i actually listened tonight as opposed to -- >> nodding your head i get that a lot. >> the answer is this. i do think the china rally can continue obviously tim can speak to this and steve mentioned it last night. they're throwing a tremendous amount of liquidity at their market it's up about 18% this year. will it spark a u.s. rally, and my answer is no because in my opinion the stronger the chinese market gets, the less inclined they'd be to do a deal with us, the less inclined they do a deal, the more pressure on our market that's the way i look at it. >> they have pumped a lot of stimulus into their markets. is that what we're seeing in the 18% rise in their market >> i think we're seeing a

combination of the fed, less pressure on the yuan, the dynamics of global trade which were more than overpriced. i also want to be clear, i don't think the chinese market has ever reflected the macro environment and macro economy in china. so the local market i think is a casino i think if you look at the shanghai market it's a closed casino it's becoming more open. in terms of global investors and the chinese, we were supposed to have gotten an announcement today, there's no question that passive flows will continue to go into china. chinese equities long term look very, very interesting to me i think the economy in the short run has bottomed all those things you talked about, triple r cuts, stimulus, you had record credit expansion in january and february. what we don't want to see because we've been worried about credit in china, in the short run it's quite good. so last night's pmi numbers are a lagging number and frank low they're not terrible. >> so i would say no and no to

those first two questions. too much debt. their productivity is stagnated and they have an aging labor force. so i think this is all about the trade deal once the trade deal, the bloom is off the rose. everything comes in, including the u.s. market. but mostly the china market will lead to the downside. >> i would just say like the shanghai is a great example. it's a $6 trillion market cap or something like that. it's a fifth the size of the u.s. stock market. i don't think it has the same implications as far as wealth is concerned. don't forget i think it doubled back in 2015 and then it crashed. so the way i see it is, is that i don't think that their premier is looking at their stock market as some sort of kind of tell on how their economy is doing relative to our president the way he views our stock market. so when you think about the wealth effect, i think it's much more important here right now. i don't disagree with tim. the news has been so bad for so long in china, really it's been

a source of a lot of risk asset volatility for the last five years. it seems like the news is much less bad at this point and there's some potential levers -- >> debt to gdp is at 300% now. and i do believe the pushback is -- i do believe that both presidents think of their marketplace as some sort of a test as to who's winning right now. so i think that china right now had that rip high off the lows, they never revisit it again. so i think they think they're in the driver's seat and i think both of us are actually going to lose. >> the victory for china is integration into the global capital market, let's be clear they want to reserve currency, they want to have commodity settled in yuan, and that to me is about legitimacy. it's not necessarily about what happens in the shanghai market so i do think that the chinese are thinking about made in china 2025, one belt, one rolled everything i'm hearing about the trade details that we don't really have and are not sure when we're going to get them

says china is not changing anything right now in fact if we're talking about their currency as a manipulator, what is it, ten years going on we've had this conversation? nothing has changed. they're happy with where we are right now if we get this. >> there isn't an irony in the u.s. asking china to basically manage its currency to make sure it doesn't get too weak. >> absolutely. >> when we've been calling them a currency manipulator this whole time i agree, in terms of the mous that are reportedly outlined so sau far, china wants intellectual property protections because it has intellectual property now. it does not want, know, to lower the barriers when it comes to u.s. companies or foreign companies entering the chinese market >> which was a deal that was struck 30 or 40 years ago, right? steve is right about debt to gdp in china i'm concerned as well. the flip side, the bull side of that is more than three-quarters

of that debt is owned by state-run entities so they could probably do this in perpetuity or until the market calls them on it. we're approaching if not greater than 100% of debt to gdp here. the market doesn't seem to care. in terms of currency manipulators and you've said it, we've been the biggest currency manipulator in the history of all mankind for ten years. >> our white house and treasury have been talking about our currency in ways we never did before yes, i think it is strangely ironic, maybe it's not even that strange, but i think there's been a lot of pressure on other currencies around the world for a long time. the chinese currency needs to float that needs to be more emblematic of their trading partners and it's not the band that woe thought it was before. let's get to phil lebeau right now. we've got a news alert >> melissa, they are going to be lowering the price of the model 3 and bringing in two new model 3s essentially

you're going to have a model 3 that will start at $35,000 as the base price the range in terms of how far you can drive on the battery pack with that model will be 220 miles. let's compare that with the previous low in terms of what they were offering for model 3, which was 260 miles range for $45,000. so they are bringing down that price point to what elon musk has long said, which is $35,000 for the base model and the range will be 220 miles. they are also offering what they call a model 3 standard range plus that will have a 240-mile range, so you're getting another 20 miles of potential range with the battery pack in that vehicle for $37,000. so that's the big headline here. we're going to be hopefully getting more details from the company shortly. one last thing, melissa, the company ialso going to be ending any sales transactions that have been taking place at the tesla

gallerias. they're throughout the country you don't see a lot of them, but particular low in some of the more well to do areas, shopping centers that cater to the well to do. you can go in, maybe see a tesla, you've arranged a test drive and say i want to buy this one. in the future it will be all online so those are the pieces of news from tesla $35,000 model 3 with a range of 220 miles. melissa, back to you. >> phil, thank you phil lebeau with the details we should remind you that tesla shares right now are halted so that after-hours trade whatever you see it's not active right now. it closed higher by 1.6% what do you make of this news? >> it will be interesting to see what the margin implications are for this car i think they made 150,000 of them last year so i mean i think it's maybe a little too early, but you want to speculate what that means as they get to production of hundreds of thousands of these cars this is no news. >> plus i think they're going in

the wrong direction. you want longer range on these vehicles remember when he said you're going to get charging stations throughout the entire united states you don't want shorter charging -- you don't want shorter duration of the batteries, you want a longer duration i'm sure they have done the analysis on this, but i do believe that it's going to hurt their margins, it's going to pull people away from the higher priced ones with the larger margins. >> lower margins but they could make it up in volume in thee row. that's the effect that they're going for. bring down the cost of the car, sell that many more cars and make up for it in terms of total sales. >> i didn't think it was a demand issue with tesla, i thought it was the fact that it was a supply thing, right? >> i don't know. we've heard north america is not going so well in the first quarter. >> of this the huge story that we were waiting on pins an needles for? i'm sort of with steve on this one. i don't really get the fact -- you could have dropped this at any time during the day. i don't think it was that big of news maybe demand is waning listen, everybody wants our car, we can't make enough of them.

>> if you were reading the tea loaves all day and a lot of people were doing that, some people thought it would be an upgrade to the autonomous system a hidden price cut or some kind of a price cut if you knew that they were stopping on all three models, trading on all three malls and freezing prices, you got the sense that it was going to involve all models and probably be a price cut so that's kind of what we got. in a world where these announcements have been a little anti-climactic or frankly untrue, a la funding secured, i think you've got a dynamic here where the market's expectation was probably higher than what was delivered here the most important thing is do they have competition that is producing cars at $45,000 to $55,000 that's starting to penetrate. >> do they have competition at $35,000? >> no, they don't. >> they don't. >> can they make this car at $35,000? i still am skeptical. >> well, they're selling the car for $35,000. whether or not they can make it for $35,000. >> that's the base price

they're assuming people will be spending $40,000 or $42,000. again, this goes back to that 35 number got etched in people's minds. that is the average cost of an automobile in america. if they wanted to go mass market, that's what they had to do, at least have that conceptually there then we lost that subsidy over the last year or so. so to me, you still have a car that's way too expensive i think they have pulled forward a lot of demand when they took those 400,000 preorders for this thing, remember over the last year and a half. i think a lot of those people dropped off the last year. >> don't you think this could be indicative of where demand in north america is elon has indicated they're shipping all their production to europe and to china. that's great, except for it tells me that north america is not as strong. if you're cutting prices, aren't you doing that because you're trying to stimulate demand i know we've never questioned demand except for the fact that we have started to question demand i don't know that they can produce this car at this price. >> this is a bigger story than north america. if they can lower the price

point that gets them into other markets a little bit better, in terms of the chinese market for instance. >> this car is much more expensive in china. >> that's true, that's true. if they can bring the price down then the tariffs won't hurt as much if they get the shanghai factory up and going, maybe they can make a car that can compete in that market for a lower price point. >> it comes down to how is the stock going to trade once this thing is free to trade, which i don't know when that's going to be we said it two days ago, the shorts had every opportunity to bludgeon tesla on monday or tuesday. it got down to 290, closed higher on the day. that was their one shot. now to me, there's risk to the upside tim talks about the pain trade being higher in the broader market i think the pain trade in tesla is higher as well. >> the irony is that elon musk theoretically has a twitter sitter, somebody who monitors all of the tweets before they go out in theory. >> he does he does? >> this week it looks like he took a step backwards. >> he tweets out yesterday that there's going to be news tomorrow at 5:00 and the stock

moves up 5.6% on nothing on no material information, just a little glimmer of news. >> and he jabbed the s.e.c. >> i feel like this is a jab at the s.e.c. >> i think it's a jab of the s.e.c. i think it starts all over again. this has been the problem for tesla. guy said it before, we thought it was not a demand issue, it was a supply issue so all those premises that you made were based on the fact that if they can produce this car in bulk, and we haven't seen any of that, it still seems to me it's smoke and mirrors. >> yeah. the strategy is in play by the white house, by the way. doesn't this feel like we're kind of changing the conversation intentionally appeared we're creating a distraction? i think the s.e.c. thing is nuanced. i think also if the s.e.c. can be the bad guy and push -- you know, push the mighty tesla or the -- push elon musk to a place he doesn't want to be, they're an easy scapegoat when in fact that's not the problem right now. we do have some breaking news here. msci will increase the weight of

china a shares going from 5% to 20%. the index added china last year. it will happen in three steps, may, august and november we were just discussing this huge run in shanghai so far in 2019, part of this in anticipation of this move by msci let's bring in rebecca patterson. great to have you with us. this will really change the face of the msci index by increasing this weight. >> absolutely. for the emerging market index under msci, china become its the elephant in the room this was widely expected so it's not a huge shock that it's happening. but as you said a few minutes ago, the passive flows into this will be a source of support for chinese stocks for at least months to come, maybe longer i think another really important point made earlier, if you have the combo of a dovish fed, so stable dollars and passive inflows into china, then as a foreign investor looking at china, i get a decent stock returning, it gives us legs for

a little while at least. >> you sound like you like china. >> we are very overweight the u.s., but in december we took our europe underweight down even further and used that to add a little bit to emerging market. we're almost neutral on emerging markets. china is a huge component of that we did that in part because we thought if we got a trade deal, which i think is highly likely, if we had a somewhat dovish fed for a piece of time, then we thought there was a valuation story and a catalyst there but how long it runs from here, i don't know >> so you're more bullish em overall, meaning china plus other markets, as opposed to a pure play china advocate. >> correct they're going to benefit from a terms of trade shock that helps their economies plus the equity valuation is much more attractive when we went pack to december than europe so you had that. then the trade deal in my mind was a pretty big catalyst. >> rebecca, when you look at the fundamentals, i get it on the trading aspect and i get it on what's in and what's out on the

china trade deal when you look at the fundamentals of investing in china right now, with debt to gdp, with the aging workforce, with productivity, what do you find forget all the other noise, is that a buy or a sell >> well, i think it's time frame. i know a lot of the folks who watch this show are looking fairly short term, and short term i think if you have china stocks you hold them but if you're looking out over the next year or further on china, you have to have a decent amount of skepticism if the u.s. slows next year, which i think it will. the fiscal stimulus wears off. europe is a mess, it's not picking up any time soon china has declining labor force, it needs a productivity lift from technology. if the u.s. is pushing back against that, how far are they able to take that to support growth so the debt i think they can massage for a very long time, but i think if growth slows, it puts everyone in a very nervous place around how long the xi

dynasty, if you will, can last i think it will make people anxious about how much exposure they have there. god forbid if the tech cold war continues or accelerates despite the trade deal and we push companies to work with allies rather than china to change supply chains, that's going to have a lot of run el effecipple. this is something supported by both political parties. meantime back here in the united states, you're using strength to trim. >> yeah, yeah. so we actually went underweight equities about two weeks ago for the first time this cycle. very hamodestly underweight after you have an 11% return in five weeks, most people would be happy to have that for a calendar year. so i don't want to be greedy if i think growth structurally is slowing in the global economy and i see some risks ahead, whether it's the aftermath of the trade deal, geo politics, politics policy, just to take a little off the table, i'm taking

a medium view trying to prepare my portfolios for the year ahead. >> if the 18 eu nations were one country, there would be 50 million more people than the united states and a bigger gdp and it's a mess, as you said when does that affect us, if ever >> if europe were politically able to harmonize their bond markets into one bond market, it would be bigger than the u.s. treasury market and the euro could become the world's reserve currency for better or worse politically it doesn't seem like that's ever going to happen so it stays fragmented when you think about the 40% of s&p sales that come from overseas, the biggest chunk of that is europe so if europe continues to have a hard time or it slows further or hits a roadblock, it absolutely affects the u.s. if you only have a u.s. portfolio, u.s. stocks, u.s. bonds, you still have to care a lot about europe >> rebecca, great to see you, thanks for coming by rebecca patterson. >> so a couple things. first of all, if you want to get

em right, you have to get china right. if you're investing in emerging markets over all on the asset class, this is great news and the weighting as we talked about. we talked just about europe. i'm of the view just like china, we price europe into going into a tailspin overnight i have zero confidence in the european banking sector in the long run, but in the short run, germany has printed a couple of quarters of growth it's a shock that came from the first quarter of last year i would get long europe. >> we were talking about how the sentiment got overly bad in china in particular. i think just from that discussion you've got to think if em is coming back, europe is not far behind it. but i think the most important thing is that the s&p 500, the u.s. stocks, are the safest bet. it's just not where you're going to get the beta in my opinion. that's why you're seeing this outperformance i think in the things that might be bottoming where sentiment is really bad. coming up, shares of tesla, they are still halted in the after-hours session. the stock is slated to resume

trading at 5:40. the company just announced a lower price model 3. tesla is hosting a conference call right now we'll bring you all the latest headlines. plus a health care hangup. the sector going from the best performing last year to the worst performing so far this year a top technician says there's some major drug stock deals in the space. we will explain. bud buddies. look, martha stewart joining snoop dogg teaming up with canopy growth to develop cbd based consumer products. a top analyst tells us what it could mean for the cannabis craze. teth more "fast money" right afr is

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that protects what's important. it handles everything, and reaches everywhere. this is beyond wifi, this is xfi. simple. easy. awesome. xfinity, the future of awesome. welcome back to "fast money. let's get to leslie picker with the very latest. >> hey, gap announcing plans today to split into two companies. old navy will be a stand-alone company with $8 billion in annual revenue there will be a spin-off of a to be named company that will consist of the gap brand, athleta, banana republic old navy will be led by sonia singall, the current ceo and president of the brand

the spin will be generally tax-free to gap shareholders gap's conference call going on where peck is explaining why they chose to make the split >> i feel strongly that this combination of brands will be powerful by bringing them together we can better leverage capabilities and investments across the brands, share best practices and drive efficiencies to create value for all stakeholders muco will have $9 billion in annual revenue, a strong balance sheet and a significant opportunity to innovate and explore new ways to serve the customer quite frankly what's on my mind is to write the next chapter for specialty retail. >> now, gap shares soaring on today's news, up more than 25% the company also reported earnings that missed wall street estimates -- or revenue that missed estimates and earnings that beat. nordstrom shares also trading higher on earnings, up 3% there, despite a slight miss on the top line.

their eps guidance was in line with the street which appeared to reassure investors. >> leslie picker back at headquarters i'll still chewing over gap. this is what i don't understand. so art peck, who's going to be the ceo of the new co, which is gap plus all the other brands says they're going to realize these synergies. i thought these brands were already together old navy wasn't the drag, hasn't been the drag for a while, it's been the growth vehicle. so what can be different now >> no idea what i was going to say is, listen, i'm not that bright, as you know i don't understand what's changed. why is the stock up? it was a lousy mackey used to s specialty retail is where hope goes to die. >> he said it better than that. >> he did. i'm not certain what this is i would fade this move if you look, negative comps, lousy guidance i don't know why the stock is up 25%. >> also the strongest part of this, old navy slowed in the

fourth quarter and actually -- the irony here is if this split follows the path and the performance of the pieces follows the same thing we saw at a number of companies including yum and alcoa, the high growth piece, the bulletproof piece is the one that's probably going to underperform and i also think that what they're able to hide in the middle of this announcement is they're closing a ton of stores. this is basically a restructuring. yes, you can get excited about that, but it's not necessarily a day to applaud what's happened. >> although it's being applauded. >> old navy accounts for probably half of ebitda of this company. >> unless they think they can sell something and they get a market valuation and then sell something. >> do you wear old navy? >> yeah. >> are you wearing old navy now? >> yeah, underwear here's the deal. >> tmi. >> we have macy's, these things were so beaten down, the sentiment was so bad, they are

obviously very cheap i think nordstrom's was up 8%, 9%, now it's up 2%, 3% all these moves get sold look at walmart. i think you want to go back to walmart last week. we look at home depot's reaction yesterday. the xrt is kind of hanging in there. i think once we get through the bulk of these retail earnings over the next week and we should be done, that's when you lay into the xrt from the short side. tesla halted after announ announcing a new model throw the stock is set to resume trading in the next 15 minutes elon muchk sk is speaking on a conference call right now. you're watching "fast money. in the meantime, here's what else is coming up on "fast." well, the news is that health care stocks have gone from first to worst. but a top technician says there's one bargain buy in the sector he will explain. plus -- >> it's magic weed. >> okay, not exactly but one top analyst says the

latest marijuana trend could be worth $16 billion. we've got ose thdetails. much more "fast money" still ahead. medicare is great, but it doesn't cover everything - only about 80% of your part b medicare costs, which means you may have to pay for the rest. that's where medicare supplement insurance comes in: to help pay for some of what medicare doesn't. learn how an aarp medicare supplement insurance plan, insured by united healthcare insurance company might be the right choice for you. a free decision guide is a great place to start. call today to request yours. so what makes an aarp medicare supplement plan unique? well, these are the only medicare supplement plans endorsed by aarp and that's because they meet aarp's high standards of quality and service. you're also getting the great features that any medicare supplement plan provides. for example, with any medicare supplement plan you may choose any doctor or hospital

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welcome back health care going from first to worst. health care was the best performing sector in 2018 but has lagged the broader market. while the s&p is up more than 11 one top technician says there is one name you can play for a catch up hey, rob, what are you looking at >> let's start with the market overview then we'll start looking at health care stocks as a starting point, the s&p, this 200-week moving average, that four-year moving average is awe very good long-term proxy

for the market we believe we're in a secular bull market. that provided support pretty consistently all the way through each of those sets of two decades. what we have here back in '11 the market bounced off and then coming into december we had the market within a couple of points bounce off that 2346 level so what we think is developing are these sort of business cycles, market cycles. we think the market is in a much longer term upcycle here that should last another two to three years. the market is up 20% growth stocks have ripped to the upside cyclicals have bounced back very strongly and increasingly from a tactical and trading standpoint most of those names are not particularly timely we want to add to those stocks and pullbacks but right now what do you do? let's talk about health care it has been a laggard over the balance of this year, but when you look at this long-term relative performance versus the s&p 500, it's still in an uptrend. yes, it has underperformed a little bit here this year.

but not all the stocks look like that so what do you do with a market up 20%, cyclicals have ripped, growth has ripped. i think you come back to some boring names as you move into the second quarter look for names that are stable, steady growth, some decent dividends. we look at what pfizer has done the last little while. it's come right back to that 200-day moving average into a tremendous amount of support it's had this big correction through '18. we think it's really timely. if you look at that relative performance all the way back to that relative trend we had in '18 and it's starting to hook to the upside names like this. a couple other stocks like cme have all pulled back they're quality, at trend and very timely here now, in contrast to that, and health care is a very diversified sector, lots of different things happening, the hmo is an area we're still concerned about. we've highlighted these for the last two weeks in our notes to our clients. they have started to roll over they have been hit very hard the last couple of days. i think united is down 10% -- 5%

each of the trading days and it's probably getting set up for a bounce off this point. however, when you look at that relative performance, it's breaking the lower lows. so the concerns around the hmos will last for a number of months take that capital, put it into pfizer we think that's a much more timely trade >> rob, why don't you come on over to the desk, shelby will bring a chair. >> good decision, mel. >> thanks, guy not that it matters what you think. how does biotech look? >> it's very mixed if you look at a lot of the midcap names, they're ripping to the upside with a lot of the growth stocks. many of them look fine, some are getting extended but i think you're asking about the big cap names like celgene i think many of those haven't participated in the rally. they had their peak in 2015 and are basing out if you look at biogen and regeneron, lower risk going into the second quarter. >> do you see a test action and

i know the numbers have changed and retracements have changed. things have dramatically changed, predominantly with powell and the fed so 2350 can be off the table, but do you see us coming in anything dramatic from here? >> i don't thinks going to be a dramatic pullpack. if we go back to 2016, the setup is very, very similar. the fed is on hold, the concerns of a global recession are behind us, cyclicals have rimmed off the bottom and you could see a 5% pullback in the second quarter. i don't think you're coming all the way back down. any pullback will be very shallow. that's why we like pfizer here. >> rob, if you're looking for sector rotation are you disappointed in the way bank stocks act or maga acts, microsoft, apple, google and amazon >> look at microsoft sort of a quality name, led into the correction it has pulled back it's pretty timely here. so is amazon quality, big cap, liquid names not the accelerated growth in

cyclicals that we've seen coming off the bottom in january and february so i think they're actually pretty timely names right in here apple, around the 200-day. i don't think there's a lot of downside in those stocks i'd bow putting capital there, pfizer, cme. it's all kind of the same trade. a little less accelerated growth, a little less cyclical >> any thoughts, rob, and this is a little out of the blue, on tesla since we're expecting the stock to reopen in five minutes time. >> there's another name. it's a different animal, it's not the quality defensive dividend type name but it's down a lot. i have to agree with guy, i think it's timely here. >> timely meaning. >> on the long side. >> rob, thank you. we covered a potpourri. >> big cap pharma, mel >> okay. what about it? where in big cap pharma? pfizer >> eli lilly is its own animal that has been significantly through its all-time high.

we've been bullish pfizer. look at both pfizer and merck. pfizer is within a whisper of an all-time high it made which 46.5, 47, and merck is close to its all-time high. in terms of big-time pharma you're talking about the potential for the double top of all double tops. if that were to happen, i'd say watch out below, folks. >> should we be concerned about some of these managed care stocks >> i think it's a huge political thing. so you have the hard core left liberal side pushing for medicare for all, but it's never going to pass. so the stocks react first to the rhetoric, but there could be a lot of dynamics where at least this rhetoric is heard it will never get passed, so i think this is a buying opportunity in hmos. tesla set to resume trading any minute now elon musk is speaking on a

company conference call right now. we'll bring you the latest. plus the queen of the kitchen, martha stewart, cooking up a new loin of cbd lines in canopy growth. this could spark a cbd boom. more "fast money" after this in n canopy growth. this could spark a cbd boom. more "fast money" after this e o canopy growth. this could spark a cbd boom. more "fast money" after this

welcome back we are waiting on tesla to resume trading at any moment it's been halted after announcing a lower cost model 3. phil lebeau just hopped off the conference call with the company. phil action what's the latest here >> the call is still going on, melissa. a couple of pieces of news from the call i had a chance to ask elon musk what's your estimate in terms of sales for the model 3 now that you are going to be coming out with a lower priced version starting at $35,000. which, boy t by the way, the orn fulfillment will still take three to six months. so it's going to take some time for this to get into the pipeline of vehicles being built by the company he answered that he still believes that it's going to be about a half million vehicles a year that they can build and sell of the model 3. i asked him what's that based on, melissa. he said, look, i can't give you anything specific. it's just my gut it's not like they have a reservation list that he can say we know that these people are going to buy it.

it's his gut, his feeling based on what they have seen from the model 3 so far also as you take a look at shares of tesla, which have resumed trading after hours now that it's open again, the question has come up about production he didn't get into a lot of details here remember, this is at the heart of what's going on with the s.e.c. and them believing that he should be held in contempt of court. he said, look, we believe we're going to build between 350,000 and 500,000 model 3s this year and between 70,000 and 100,000 model s. that gives you about 420,000 on the low end, on the high end as much as 600,000. that's the two pieces of news that have come out of the conference call so far. >> is this conference call just for media or financial analysts as well? >> just for media, not analysts. >> phil, hop back on and give us any updates as you get them. tesla shares reopen for trade

moments ago. it's been pretty volatile in the early going but it is down about 2.5% remember, the stock was up about 5% on the back of the twoeet tht there would be news today, so not giving up all of the gains there. it's interesting that the main focus that phil had put in front of us is the number and that he didn't violate the terms of the s.e.c. deal because the number that he gave on twitter was actually pretty correct based on the math now. >> he should stay off twitter. >> yeah. >> when you say big announcement coming, the big announcement could have been we're partnering with apple going forward that to me is a big announcement which we would have spent the hour talking about i think, though, you buy weakness in the stock and the trajectory is still higher. >> so you just said the math it's not the math, he just said it was his gut think about it he's talking about 500,000 cars, but his gut -- did you see the cover of bloomberg business

week it's talking about peak autos. it's talking about all the alternatives that people have now to own cars. we're going see lyft and uber come out to the public markets i suspect we'll be talking a lot about them in the context of some of these auto manufacturers also so that's a 2019 story. >> let's just get to what the announcement was they're cutting prices, okay, folks. do you cut prices when you have great demand do you cut prices or would you might possibly cut prices when you have liquidity issues an want to sell more cars in the short run? interesting that that 420 number came out again, by the way. >> this is not just we're putting cars on sale, this was their goal from the get-go when they launched the model 3. >> mass market >> at a negative margin. >> if you flip that around, they actually achieved the goal that they had set out for in another universe that might be praised. >> not if that car cost $45,000 to make.

they're running at a deficit you've got zero margin it just got worse. you've cut demand. you've cut all your stores why do you go all online you need cash. >> they also have to make the car. i don't have real conviction and confidence that they can make the car. i don't disagree with guy about the technicals you should be able to break it a little earlier or recently, but i would be a seller because i think guys are afraid of what was going to come out today. nothing came out today you probably see more pressure tomorrow. >> we'll continue watching this stock and how it's reacting in the after-hours session. we've got more news now this time out of hbo. let's get to julia boorstin for the details. hbo's ceo is stepping down after 27 years with the cable company. now, of course this comes about nine months after that deal for at&t to buy time warner, hbo's parent company, was competed and just a number of days after the department of justice's effort

to shut down that deal was ultimately dismissed plepler informing his staff saying it's an inflection point for the company and he's proud of what he's built i have heard from sources close to the situation that he feels like he had a great run at hbo and wasn't so eager to be part of the larger machine and under -- and with more hierarchy above him as part of the larger at&t family. now, plepler is unlikely to be the only big executive at warner media to leave the company i just spoke to a source close to the situation who weighed in on the speculation that david levy, who is currently president of the turner, another key division of time warner, is also considering leaving the company. he said there's been a lot of speculation in the company that right now he may be in the process of negotiating his exit. so obviously a lot of change at time warner. the company formerly known as time warner, now warner media as part of at&t as they go through

this restructuring process. >> obviously, julia, the timing of all of this is pretty terrible in terms of losing key executives just when they're trying to gain some traction on the service. at&t was speaking at a conference the other day did they talk about pressure and subscribers? >> well, i think at&t is talking about everything they have in the works. they're investing in content, they have this direct-to-consumer streaming service they're planning on launching towards the second half of this year, in the second half of this year an that's a three-tiered service really competing against netflix. i also think it's worth noting, melissa, that they understand that they're going to change this company just a couple of days ago there were reports that bob greenblatt, a former nbc entertainment chairman, was in talks to come in to warner media to have a senior role at that company. so just as there was sort of an expectation that some people would leave, i think it's maybe not so surprising that these departures are in the spotlight just a couple of days after those reports that there could

be a new boss at that business. >> julia, thank you so much for that context julia boorstin joining us with the latest on hbo an at&t. you were remarking, guy, that at&t has been a struggling stock. >> yeah, i used more colorful language in the commercial break and won't use it on tv here. this stock has been going basically straight down since topping out in the beginning of '17 at $45 or so it's been a tough own. people say valuation compelling, you get the dividend guess what, you've lost all the dividends you've got in terms of price depreciation so what does it mean now dan, i cheat off dan all the time i looked over his shoulder and that flush down to $28 in mid-december was quickly recouped recoup ed and here we are with the potential for a little reverse head and shoulders and this gets the stock back up to $36.50, $37. >> what is it waiting for?

you think about verizon massively outperformed at&t last year we have utilities making new highs right now. you would think that at&t would be participating so to me i think these management exits are not that surprising, given what's going on but what's really important is that they nail the content transition we know that this global phenomenon, which is "game of tloe thrones" is ending this year ten years ago when "the sopranos" was ending, they need these anchors moving forward. still ahead, tesla down 3% after it resumed trading moments ago. elon musk is speaking aon conference call right now. we'll bring you the latest much more "fast" right after this

welcome back to "fast. more headlines coming from elon musk in that conference call let's check in with phil. >> melissa, let's take a look at shares of tesla. two comments within the last ten minutes are going to get some attention here first one he was asked about the costs that are going into bringing down the cost on the model 3, selling them, an the overall profitability of tesla he says that profitability will not be happening in the first quarter, and the possibility of a small profitability in the second quarter is likely in regards to the first quarter, this should not come as a huge surprise to investors. you've got a number of things. remember, they made the announcement about counting 7% of the workforce as they try to

streamline their operations. that's a charge they'll likely take in the first quarter but we don't know to that extent. they're starting to ramp up dlefr deliveries to china. and that means there's a lag time between vehicles built and vehicles sold. put all that together and you've got a first quarter, elon musk says tesla will not be profitable >> all right, phil, thank you. phil lebeau. again, the stock down 3% remember that rbc downgrade recently of tesla. that analyst there said at that point in time that he was concerned about the more affordable model 3 and that the fourth quarter might have been peak profitability for tesla so far it is >> look, it appears that they got some numbers when they needed to do it. i think the year-end cash numbers were also a little bit window dressed, but you know that from me. >> down 3.25% here on tesla. still ahead, check out

shares of nutamix. are there clear skies ahead? traders will weigh in when "fast money" returns so with xfinity mobile

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>> salesforce reports monday after the close. today call volume was 1.5 times that of puts the call activity was actually not one trader, it was a bunch of traders it was a lot of activity in the march 15th expiration 165 calls, about 3700 of them traded for an average price of about 6.50 so you're looking for a move above 71.50 if you were buying those at the money march calls playing for the earnings event 6.5% move in either direction. on tuesday, that is rich the 4.5% move the last four quarters this thing has been an absolute monster. look at it back above consolidating that prior high here looks pretty good. let's go to the five-year real quickly. this is one of the best-looking charts on the market who cares about valuation at this point mark benioff is doing everything he needs to do to make these guys the major player in the cloud. >> thanks for that, dab. full show "options action" tomorrow at 5:30 p.m. eastern

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>> you know why i found out about it other than you? i found out about it on the twitter. >> all right that does it for us. boy the way, tesla shares down 3% in the after-hours session. we'll see you back here tomorrow at 5:00 for more "fast." don't go anywhere. "mad money" starts right now >> my mission is simple, to make you money. i'm here to level the playing field for all investors. there is always a bull market somewhere, and i promise to help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. welcome to cramerica other people want to make friends. i'm just trying to make you some money. my job is not just to entertain you, but to educate, teach you and put it in context. so call me at 1-800-743-cnbc or tweet me @jimcramer. i always say there is no room for woulda, coulda, shoulda in this business.