cup. >> the u.s. won? >> yes >> oh. >> you tried to hit me with cricket. i'm talking about usa. >> you don't usually talk about usa. >> after you watch baseball from london. >> after i watch baseball from london, i will be there. anyway, come on, england. >> you're not flying in for the red sox and yankee's game. >> anyway, that does it for the show have a great weekend. >> enjoy "fast money" begins right now. indeed, it does. "fast money" starts right now. live from the nasdaq market site, overlooking new york's times square, i'm tyler mathisen in for melissa lee traders are tim seymour, carter worth, steve grasso and guy adami. i'm calling this the xi 20. >> oh. >> i love it. >> the xi 20. >> love it. >> but the chart master says there's trouble brewing and ubs slicing its market tesla for the

third time on the year stocks closing out the best first half of the year in two decades. the s&p up an impressive 17% tech, far and away the best performing sector, up 26%. health care, the worst, up just 7%, trailing the broader market. with trade talks john going and fed cut hope still high, do you stick with what is working guy adami? >> first of all, tyler, tyler matheson. >> it is special. >> he's legend. >> as special as new year's eve. >> it was new year's eve, the last day of trading for the year this is the last day of trading for the quarter. they call me the closer! >> you're doing a great job. >> the closer! >> the ramp up late in the s&p 500. i know steve has been on back of this market is going to rally, and the market has been rallying i don't trust it but i have not trusted for quite sometime for full disclosure. i think the quarter end markup was definitely real, but to answer your question about tech, i think you have to fade it. i do not think a deal with xi

20, as you just said, i don't think it is happening. i think the chinese are stringing us out maybe president trump will come back and say what a great meeting they had and they love each other, but i don't think we'recloser to a deal today than section months ago, tyler. >> if the weekend ends with no deal as most people think but kind of a truce -- >> that's enough. >> is it enough to keep the market going >> is it priced in yet >> i don't think it is priced in yet. people were overwhelming on the s&p -- as long as xi doesn't walk out of the meeting, it is an ultra positive for the market. >> ultra positive. but remember what sent the market into a spasm in may was the idea that the talks were not going well on trade. that's what we spent all of may working through and june recovering from. >> until, tyler, the fed came in and said, we are the most important person in the room i still think it is about the fed and i think it is about july, and i think it is about 100 basis points effectively

priced into the market, certainly 70 between now and year-end i think what is interesting, first of all, positioning. when you talk about smart money, i'm talking about long/short hedge funds, the fast money community, not necessarily this desk, but people that have been essentially flat to net short, they're equity bogeys for a good part of the year frankly, this is part of the pain trade i think takes it higher you have strategists basically are bifurcated hey, we're going into resistance, a lot of great news priced in as carter says, but if we get through g20 without an announcement, i actually believe they could go higher. >> guy says fade the trade on tech what do you say? >> we know it was a great first half but it was what followed of course after the worst december since 1931 so it is the reciprocal of the sell-off is the rick owe share, but here is the important thing. right now guidance for q2 is running at a negative rate that's not seen since the second quarter of 2006. there are 113 s&p companies that have issued guidance, and 87 of

them are saying it is going to be below consensus that's at the highest negative rate in 13 years. >> i don't think -- >> that's what matters. >> and i'm not disregarding that, but to tim's point and what i feel is that the fed is the most important thing happening here, and if trade goes south you have the fed backstop you would ray green with that, right? >> right. >> we heard everything -- >> we are the world. >> powell is terrible when he speaks he does not ease the market. but if that happens and things go negative or earnings go negative, you have the fed backstop so i believe you could move higher and still buy tech. >> agree 100%. >> tech led for the last five years and will continue. >> agree 100% but he is learning how to message. >> i don't think he is learning at all. >> let's come back to tech and join the argument. >> you mentioned we are the world, something google basically sounded like cyndi lauper in her vignet, we are the world, not so good google and some of the big tech

names have held the market back, otherwise we would be well through this that's the place you want to look you want to look first at the underperformers. it is hard to call google deep value, but relative to the peer group and the top line and peg ratio, those are names that i think have been beaten up by the headlines we know and the expectations that the world was slowing. i think actually this is a great opportunity. >> how about health care guy nailed this the other night. we have two debates that were extremely painful to watch from where i stand on my ideology, but what did you hear about? single payer, medicare for all, all of this. >> health care. >> health care had been a leader, for years before this. tech has been a leader for five years. health care really had some decent performance but i think it will be mired in negative head winds prior to the election. >> it pains me to say this about faang because i want to dislike facebook for a number of different reasons and i think we all have our bias, but with that said you can't deny the stock

over the last couple of weeks at least performed really well. tim correctly will say it has underperformed, but the way the stock sets up given the backdrop and earnings in a month or so, sets up well on benign take, so facebook up to 320 which was the previous high this past fall or so makes sense out of the four names, tyler. >> and yet what we know is that the new york faang indix which was created and started trading about a year ago is lagging badly because some of the greats have faltered. so it is a selective case to be made where certain stocks are doing well microsoft is a beast, right? >> microsoft is a beast. that's one of the great stories to me of the past few years, is how this new ceo has taken that company and turned it around because it was dead money for 15 years. >> the thing about microsoft is they were the ones -- i mean the multiple of the stock was rewarded with their move to the stock, which they're already there, their recurring revenue i think what people forget is that the cloud has gotten very,

very crowded i think margins for enterprise will continue to be a drag on the guys that priced it in already. so you are absolutely right. i think microsoft was yesterday's story, but i think it was yesterday's story to me, you know, the faang that underperformed is the faang with the best fundamentals. i don't like facebook here i mentioned google i think apple and amazon, however you are spelling your faang are both places, despite the johnnie ivory news overnight -- >> doesn't trouble you >> doesn't trouble me. >> doesn't trouble you that he is leaving sorry, i cut you off. >> no, it is facebook lagged, google lagged, it is microsoft and newer tech, mid cap names that dominated the run and have not faltered but super cap names that were forming larlings and a lot faang index names are not performing. >> as you look back on the first half and ipos that have come out, how do you grade it >> i guess you probably give it

a "c" to a "b" because you had ones that dragged it down. maybe a "b" plaus becauus becaud names that have taken off. >> you had beyond meat, everybody knows about beyond meat. >> i think uber clouded it, including myself, i thought it would have a better performance out of the gates than it did i think it clouded my judgment. >> guys, uber is up. i think you have to give the ipo market the dynamic of the ipo market, whatever you want to say about the companies that aren't making money and some that structurally never will, when the fed is giving money for free, and it coincided with the time -- you have a lot of them coming out of silicon valley in an environment where money is free that don't make money -- >> carter, you have been a bad

boy. this is the point where i'm told you have to leave the desk, get up and walk over there. >> i'm going to do this. i'm going to walk over there i'm being cast out. >> he's going to walk over there and tell us why he thinks the rally is about to stall. >> here is the thing the rally stalled 15 months ago. that's the key to the entire segment we will talk about here. this is a friday, similar to today. it is 17 months ago, friday, january 26, 2018 at that moment the s&p 500 registered its highest weekly rsi reading ever recorded, higher than in 1987, higher than dotcom in march of 2000, higher than 1929. it was to that basis, one of many, but the weekly rsi, the highest registered in the history of the equity market that's excess and we have been risk off ever since. let's pull charts forward and go from there from that moment consider this line and consider what the market has done. put in the market. the market has basically been

churning now, some are making the case it is going to break out, but what is important is all during this phase, that's 17 full months, i. it's been entirely risk off even though tech has performed. let's talk about that and put it into context from that point, the blow-off top, the most overbought, the most registered, look at the results, s&p, no results gold up more, treasury up more, utility is up the most the point is the market, the rally stalled a year and a half ago and there's a great debate whether the stall is a rest before we break out or, of course, it is a stall before we roll over. both camps have good arguments to be made, but there's no confusion, right the market, as it were, stalled almost a year and a half ago that is a condition that can't be argued with now, the equal weight, which in a way adjusts for truth market breadth because we know super cap names, the top five names

are more valued than the bottom 250. if you take the s&p and make it an equal weight index, it is virtually stuck at those highs if you look at this line, it has stopped here repeatedly. again, a lot of people are calling for a breakout we would need a lot of things to happen for that to happen. most notably, a little encouraging today, banks, but industrial, energy and materials. it can't be just the super cap names, beasts like microsoft driving the way. the point is here, you know, it is anybody's guess, and both arguments are valid but there's no confusion it is entirely risk off for the past year and a half and equities risk adjusted are the worst place one could have been for the better part of -- >> that's an amazing illustration you have done your time in the penalty box. you can now come back. >> come back. >> let's take a vote. >> tyler, i mean, come on. >> let's bring him back. >> carter worth, you know, if you're on the mount rushmore of cnbc, i mean you are right -- but carter is on the mount

rushmore. >> with an empty seat, it wouldn't be great. >> wouldn't be to have an empty seat. >> let me take a pick and a choices chisel to mount rushmore for a second, because i could make the point that it has been extraordinary. we topped at 2860, 2870, then to 2930 and 2960. we are slowly moving higher. >> if you look at the value line, which is even broader equal weight, it is the s&p 500 plus the next 1200 biggest names, 1700 stocks plotted equal weight, it has stalled and more so rolled over the issue is -- and i tried to make that case there's a perfectly good case we do break out and the other is the opposite case, mine is that we roll over there's no confusion that equities risk adjusted have not been a good place to be. >> a lot of vol. >> a lot of vol. >> let me tie it off by asking this question. better than 50% chance that the

market ends the year higher than it is today or a lower than 50% chance >> i think we're higher. >> better than 50% chance we're higher >> i would say better than. >> i would say based on what we know about forward guidance, lower. >> better than 50%. >> better. >> remember card sharks? you're a fan. >> i do. >> lower. >> a less than 50% chance we are lower. >> break the tie, ty. >> i say better than 50% chance higher. >> 3-2 the supreme court has been broken the chief justice has voted. coming up, tesla in turmoil. shares have been spiraling downward and one top analyst cut his price target for the third time this year he will be here to explain why plus beer stocks are, of course, bubbling up this month there's one surprising name leading the way. we have those details, and we're live from times square in new york city. erisucmothe mh re "fast money"

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>> tesla getting reenergized over the past month, the stock up 20% in the last month but ubs is not buying it, cutting the price target for the third time

this year and reiterating its sell rating on tesla >> it is our call of the day u ought oy analyst colin languagen is behind it he has a $160 price target on tesla down from 200. welcome. good to see you again. why are you letting the air out of the tires on tesla? >> you know, we look at it as i think we're going to see a lot of the surge you have recently seen are expectations they will do well on q2 deliveries which we agree given the june surge you typically see. we highlighted that in our note today. but i think people are missing the profitability in the second quarter when they report later in july will actually miss the mark, largely because a lot of the deliveries we have seen are driven by pricing. i think people are underestimating the margin pressure that will have. >> it is pricing that is bringing in the margin pressure in >> absolutely.

what they did earlier this month and making the autopilot standard, early in april they made autopilot standard. it was a $5,000 option and they increased the price on average by about $2,000. you are taking a lucrative option, most went to margin and only increasing it $2,000. so you are talking about a $3,000 margin hit. when you blend it out we estimate about $900 in margin pressure per vehicle. >> if i'm reading you right, you expect a pop in the stock when delivery numbers come out followed by a fade, right? >> that's absolutely what we wrote in our report. we expect a pop on the delivery number as bulls are probably appeased by the recovery in the decline in q1. it was driven by the pricing that i mentioned and secondly a bit of a pull-forward because in the u.s. the tax credit fades down july 1st, so about $1900

savings so you are better off buying in june than july that's why i think we go into the second half of the year, you will see deliveries fade and you still will have the margin pressure because the price cuts probably stick through which means currently consensus is forecasting a profit and we have losses in the second half. >> colin, tim, i think the deliveries is dream. i am looking to your static weighted cost of capital and not a lack, but i would be focused on the balance sheet, all of the signals that the company -- and frankly with suppliers there's a lot of dynamics that tell me the company will have trouble making it five years. we have folks on our show who have been solid in the name, have a thesis that's a five-year thesis i don't know how you can have that. >> i think really, you know, they just raised capital they raised 2.7 billion. that puts them at dloclose to $ billion in cash. our estimate is they're safe until 2021, and i think that

will be a critical point to see where profitability is at that point. they bought themselves some time so i think it is less imminent of a catalyst. the reality is they need to push the deliveries because it is a growth stock not demonstrating growth you are pushing deliveries and, quite frankly, i think the near-term concern is where profitability will be and q3 and q4 deliveries will disappoint as well. >> thank you very much we appreciate your time. have a good weekend. >> you too let's trade tesla. he says they're good through 2021, but at that point competition is going to come audi is going to come, bmw is going to come. >> that's a factor, too. but i think the issue of having money on hand is going to be a problem. plus margin. colin was talking about margins. the tax credit goes from 3750 to 1875 on monday and evaporates to zero december 31st that's going to crimp their margins more because they have to cut prices on the car or keep them the same. people will no longer want the

car or make less on the car. either way, it is a negative for tesla. >> the rally we have seen, it is a classic rally. they jumped and now back to the point in which is plunged and resumes the down trend it is a busted stock >> this was a $375 stock in december remember, october, november, december were horrible this stock made a series of lower lows and lower highs ever since. carter had a great call a couple of weeks ago to buy the trough, but i have to tell you something, i think it rolls over i think you read tesla's levels we saw weeks ago. >> independent company in ten years? >> ten years from now, i'm like 78 years old i don't even know my name is ten years. >> all right, guys great lap track. >> we will leave it there. for more on tesla and the other big analysts calls of the day go to cnbc.com here is what else is coming up on "fast." >> beer, yum, yum, yum.

>> yes, beer stocks are soaring this month but one name could be about to tap out we have those details. plus, check out this mystery chart. this stock is having its best week in a decade but the traders think this stock ers chor too far, too fast the'mu me "fast money" right after this

welcome back to "fast money" shares of con tellation brands jumping today. strong earnings report there the company expects a sales boost from beer in 2020, and the ceo says consumers are not picking just one poison. >> one of the things that has changed in the last 20 years is today's consumer drinks across all three categories, beer, wine and spirits, much more than what had happened historically. we are perfectly positioned for that we have all of our products in the high end, whether you talk about our wine business, our beer business or our spirit business we are playing in the high

growth, high margin sectors of the business and it is paying off for us. >> constellation and some of the other beer stocks turning up for the start of the summer. is the party just getting started? >> oh, my. >> are you chugging these stocks or not >> listen to you. >> there's a problem with beer though. >> i've been working on that all day. >> beer is spiraling downhill, but modello and corona have out performed the group. the stock is up 23% year to day. they have a play as well if i look at sam boston beer company, they outperformed by 2x they have dog fish that was a mergen a couple of months ago. i think you have to have a catalyst play. >> which constellation does. >> and you have to have well versed, spirits, beer and cannabis which is what constellation has over everybody else, even if they underpurchase formed. >> what about the dog, wilson coars coores. >> and bud has some succeeding

products, michelob ultra is doing well, but the main brand, bud lite, is down. >> you had massive consolidation four years ago, and there was engineering. they were at it once again, the guys at 3g capital, big players there. the fact they group 7% on the top line was impressive. when you talk about canopy growth, they are saying a billion top line by end of 2021. the problem is in the short run it has been a hit on margins about 15, $0.20. >> time for the final trades tim, you first >> i labored long and hard on google, have a great weekend. >> carter. >> biotech and you xbi to play it long. >> mr. grass owe. >> homebuilders. you saw lennar, stay long, three-day rule buy lennar. >> ty, did you have fun? >> i had fun this is so much fun. >> typically i get out 5:30, i'm

out here like zip, bam. >> you know what, is it only if i hang out >> yeah, stick around. >> i'll put on a jacket. >> yeah, baby. >> yeah, baby. >> yes, sir. >> clf, tyler. that will get it. >> that does it for us here on "fast money" don't move "social options action" starts right after the break.

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hey there, everyone. we are live at the nasdaq in times square this is my first time ever hosting the big "oa. hang on, folks tray tables up, seat backs forward, seatbelts it could be a bumpy ride here is what is coming up. one chip stock just had its best week in ten years, but mike khouw and guy adami think the smoky semi could come back down-to-earth. they'll layout a trade in the ultimate options tag team, plus -- >> it's alive, it's alive!