the bank showed us it's unlikely to get positive commentary on the commentary front for the earnings, microsoft obviously a huge one if they trade like netflix, surely a high chance to drag down the rest of the market didn't happen today. nasdaq closed higher we're out of time. thank you so much for watching "fast money" starts now. welcome to friday and another installment of "fast money. here's what's on the show tonight. we're going to take a look at the breaking news in shares of nikola, down by about 15% in the after market session we're getting news that nikola is selling shares into the open market let's get straight to the story here karen finerman, we noted for nikola at least, they had registered an s-1 back in the middle of june which would have paved the way for insiders to start selling and this is what we're seeing take place in the after hours session.

>> right i mean, it's not surprising given what the stock has done that insiders would want to monetize some of the extraordinary gains. i can't quite tell how much is insiders any stock associated with insider selling is fine. i don't know what price it's going to get done exactly. still, it's just enormous from where it was it hit 80 and then went down to 40 it's been a crazy ride i don't blame them for wanting to take money off the table but i wouldn't be a buyer on that offering. >> it allows insiders the sale of up to 53.4 million shares so we knew this is happening in fact, some analysts said this is a ticking time bomb hanging over investors, yet we are seeing an outsize impact on the shares on a day when neo gets rated a sell over goldman sachs

because of the run we've seen an enormous run over the entire space here. >> yeah. even within the auto, hydrogen fuel, the entire space has been a place where momentum traders have been chasing momentum they'll also be chasing on the way out. we've said for weeks these valuations are difficult to justify. we've had a lot of dialogue with the ceo on this show i think trying to understand how much of this is promised, how much of this is reality. the company has cap x needs but this is a case where people are taking chips off the table it's actually a case where people are going for liquidity it does make some sense, but it's disturbing especially in the context of a lot of promises that have been made. >> down 17.5%. some people might be taking a look at this and thinking this is my opportunity to get in. what do you think?

>> this all hinges on that clothe val growth value play. yesterday there was a headline that deutsche bank put a $54 price target on the stock. this is just, as we all know, very, very early in the story for the stock. i don't know what to do with it, nor do any of us no one can say for sure. but it does seem if growth comes back, this stock will probably rocket higher. it's way in the infancy. we're not really looking at any trucks we're not really looking at any factories. this is way in the early innings. this is a crap shoot. >> for the bulls out there, no factories is a good thing, finding a partner to manufacture as opposed to taking on that cost by tesla. i think initiation by rbc, they said this looks more like a business plan and not a business of a company in its infancy and yet being rewarded with such a high multiple. >> yeah.

i think people harken back to when tesla went public and they're like maybe i've got a shot at the next one, which may or may not be true we've had trevor milton on three times now if i'm not mistaken, at least twice i'm sure he can amplify or explain what's going on. i'll say this, if this was apple that did something like this, something like this meaning announcing a secondary on friday in july after the markets close, i'd say that's not very cool that's exactly the term of using. it's not very cool it might be fine it might be a huge buying opportunity. but the people out there that are probably long on the stock are looking at this and saying, you know what, i feel like i just got rooked. that's why people get so infuriated when they see things like this. the timing stinks in my opinion. >> should investors think there's something nefarious going on because this comes on a friday after the markets close or did we sort of know about it

because the registration was filed and so it was a possibility at that point on >> right i think to give the benefit of the doubt, right, registration was filed. i think the stock traded well above the price. if you were familiar with all of this stock, this particular instrument and the warrants, then you should have expected it but i agree with guy, the friday night thing, not cool. it's the least good day to do it. >> yeah. agreed there. let's move on and talk about the markets. transports trucking higher this week, rallying more than 6% far outperforming the broader markets. this goes to what steve grasso was talking about in terms of value outperforming growth this week what does this say about the future of the economy?

you believe transports are a leading indicator of economic activity so this should be a good thing >> i'm very familiar with exactly what, i don't think most people would admit that dow theory today means something different than it did 50 or so years ago. i don't think it's nearly as important to the economy this is not me trying to sidestep i think it's a much different economy now in terms of the transports good for tim, karen and steve. they've been on this, especially tim with federal express it's had a tremendous move the iyt 176 i think is where we close. it's smack up against levels when the s&p topped out in june. now it's proven itself now it has to prove itself to get through this level of resistance

fedex absolutely is broken out out of a 2 1/2 year down trend that's the guide sign. the iyt needs to close above 176 or so in my opinion to verify that. >> tim >> think about mid may is really when we started to see the change in the transports and the change in behavior and the outperformance of the s&p. the entire transport sector as outperformed the s&p by 10% in the last 43 days we talked about the disparity between growth and value the s&p outperformed amazon by almost 8% in this last week that we've just gone through. we've seen a lot of these storie stories. ap l a lot of the story with fedex was also lower cost case and starting to see some momentum in their ground business and call it operational efficiency in the overall business model

if you look at that chart also and carter may or may not have a view on fedex specifically, that pop from the earnings it held, it's essentially a flag pole formation. it's a stock that spent two years underperforming the market if you follow fedex, it massively underperformed the market from january 2018 to those lows well ahead of the market and much in the ways of transports were also outperformed when there's some sense some of the leading indicators have bottomed i don't know where we are with covid-19 and the real economy, but i will tell you fedex is following a script that i think it should be following right now. >> on earnings better than expected earnings, new record high in today's session. karen, are you in fedex? >> i am. i am in fedex. it just got too cheap. i agree with tim on fedex. guy mentioned the dow theory

it's a leading indicator i'm wondering if some of this strength was when the covid situation was looking a little better maybe three or four weeks ago and if we might see another little bit of a slowdown as things have sort of reclosed so i still think it's cheap certainly relative to itself it's got a long road, a lot of ground still to make up. so i'm not selling any here, but i wouldn't be surprised if we did see a little bit of a pullback some of those earnings today were up going into them and still they performed well. let's switch gears we're watching astrazeneca set to release on monday shares have climbed nearly 14% this week ahead of results on monday it was reported that the results could be positive here steve grasso a lot of this

rotation we saw this week was on the back of positive vaccine data from various companies. could we see this rotation continue going into next week, assuming the oxford study also has good news? >> yeah. i think we're going to be looking at this all the way into year end goldman sachs pointed out there's probably four vaccines in the later stages offing ready f being ready for use. we're going to hear about these headlines probably for the next couple of months on an everyday basis. i still think ibb best way to play it, up 17% year to date those are ways you're going to kind of mute your risk when you lock at stocks like moderna that was up big today and that have rallied tremendously, you're never going to get those unless you're in

the right one. i just doubt that anyone really has an inside track on all of these to know which one to pick. i think for the average person, the ibb is probably the best way to go. >> it's interesting that moderna's shares popped again today, up 16% in anticipation perhaps of azn validating some of their results there's a note that crossed my inbox today about the release on monday it basically said if it shows there was antibodies produced, that there was a t-cell response and it had pretty clean safety and side effects, this could be bad news for the smaller or mid cap biotech stocks it could show that big cap pharma is the place to be because they've got a handle on it with much bigger trials and potentially better ability to manufacture. >> in terms of azn, absolutely big cap pharma even when they

had the cross hair of both parties on their back, they've really done well eli lilly has been a monster we talked about ibb. i think it made a new all-time high again today that continues to dprie s ts to. i can't speak about moderna, the move today i still think if you've enjoyed the move higher off that 50 handle, you're taking profits. not to cast apersispersions thei think you're really playing in the deep end of the pool with ibb at least you mitigate some of the risk in a space that i still think has tremendous upside. technology falling all-time highs. amazon putting in its worst week since february what is next for this secsector? carter worth is here carter, what are you watching? >> there's a couple things it's worth noting we are in the history books with 91 sessions

without having three consecutive down days. if you look back at the history of the entire sector, sectors date back to 1989 when they changed the nomenclature, this has only happened one other time it happened in the july to december period of 2004, went as many as 108 sessions without having three days in a row down. we're at 91. in 2004 after that happened, the sector dropped about 15% in a period where the market dropped 7. so twice the rate of the market. let's look at a few charts, one of three the first is how orderly this has been this is essentially looking at the tech sector since the low. you can see here we've had six distinct drawn out you can see the duration typically two, three, days, three, two, one four, all on very short-term.

the drawdowns are between 8 and 5% almost universally. you have these dips. this is the part that's in the history book they hold and they stick and they don't follow through. so the question is this second chart. we are now right on the trend line that's been in effect since the low of march will this be like 2004 where we eke out a bit more, or are we already on borrowed time and the message from amazon is that this has reached its sort of end run. the final chart is a two-panel chart. regardless of how good this is and it's been darn good, what we do know is this, that the tech sector has still not recovered losses to the s&p since its peak you're looking at a two-panel chart. that is the entire tech sector on top on the bottom is the tech sec r

sector's relative performance to the s&p. you can see the gains are still not as much as the gains in the s&p dating back to march >> does this mean the entire index falters? does this mean a change in leadership >> remember, that has been the hope there's always trades and cyclical things but there's no enduring play in a value name. a value name is a missed pricing. someone that's winning over time is where your money wants to be. you don't want to find something you can catch a train unless you really have that kind of dexterity. there are disrupters taking market share on a long-term basis. on a three-year basis royal caribbean versus a microsoft, that's ridiculous.

>> carter, thanks. tim seymour, that sounds pretty dire >> well, once i figured out what gnome chatunomenclature means, y got kpietd abouexcited about it it's very difficult to see tech breaking this outperform relative to growth on a p.e. basis and an absolute basis. i think we'll see value come back a lot of these industrial name versus sonames have some room to grow > coming up, sheila bair send us your burning trading questions. feeling stressed? try new nature's bounty stress comfort. three unique gummies for your unique needs. find peace. boost mood. sleep well.

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welcome back to "fast money. former fed chairs sharing their views on the government's policy respond to the pandemic. their bottom line, more may have to be done in their blog post they write based on our experience in the global financial crisis, we think the fed may find it needs to go further. although banks are currently strong, it is possible the pandemic will so damage the economy that credit losses mount rapidly. what could the fed do next let's get some answers from sheila bair. you have said in the past that you hoped that banks couwould n pay dividends, that would be the responsible thing to do.

the earnings came out. you say they're better than expected but what do you think the banks are underestimating in terms of the damage the pandemic could cause? >> there's tremendous uncertainty. better safe than sorry conservative the capita conserve the capital now if it turns out better than they fear it might be, they could always pay a special dividend. traditional lenders are going to be the hardest hit we're seeing that with second quarter results. they're being hit hard by compressed interest margins and also win/losses provisions are really high. i think they should stick with the conservative because the small businesses and householdings can't access the corporate debt markets they need bank lending for the big wall street banks, yes, they did have a good quarter. let's face it. those profits are coming

courtesy of through the trading profits. i think that's not going to continue i think 1.2 trillion corporate grade debt has been announced this year. some of these companies may borrow now, but i don't think they're going to make it and those losses will eventually slide through into the banking sector everybody needs to be cautious now. i would be suspending dividends, holding capital. you can distribute it later if things turn out better. >> karen >> my question is there a way for the fed to target specifically regional and smallsmall community banks that haven't benefitted by some of the capital markets activity >> that's a really good question i think they've been trying.

they're good at infusing money into large financial institutions, supporting financial markets, getting help into the smaller institutions and direct support for main street lending is something they're not well-equipped to do. i think we need more action from congress i'm hoping they'll have another stimulus package we need more support for small businesses it really needs to come from the politicians. the fed is not well-equipped as i've spoken on this show, i think ultimately digital currency might provide a way to get support more directly to main street. their tools are just to prop up financial markets. it's very difficult for them to get help broadly into the economy. >> the former fdic chair the krcfo of bank of america sa

significant credit card losses wouldn't show up for 180 days. that's a delayed read-out of what the consumer is feeling i don't know if the loss provisions are enough, tim, for unforeseen and uncalculable losses. >> think about the loan provisions were even amped up that much more to sheila's urgings, i think jp morgan took a lot of those trading profits and plowed them into higher provisions i thought that was pretty conservative it does tell you we're very concerned. this morning moody's has a record 414 companies on their list of financial trouble. here we are seeing the fed go out and buy the debt of apple and other big companies, but those companies have no problems issuing debt that's not where the problem is. think of the retail sector, brooks brothers, j crew, jc

penney, think of all these companies that filed for bankruptcy i think the credit cycle is worsening, not getting better. if the argument is to be deserve on dividend payouts i think investors should want that too for the balance sheet of the companies they invest in you're first. first to respond. first to put others' lives before your own. and in an emergency, you need a network that puts you first. that connects you to technology to each other and to other agencies. built with and for first responders. firstnet. the only officially authorized wireless network for first responders. because putting you first is our job.

i want to stay at unh. >> steve grasso? >> i bought on semiconductor ticker symbol on it bypassed that strike price of $21. i decided to hold onto it. >> karen >> so not finding a lot new to buy. i don't want to sell what i own, but i do want to buy s&p protection the vix as near as low as it's

been since the crisis started, 25 and change today. so s&p puts. >> guy >> intel, mel. $60. feels like it's going higher. >> that does it for us "options action" is up next. just over a year ago, i was drowning in credit card debt. sofi helped me pay off twenty-three thousand dollars of credit card debt. they helped me consolidate all of that into one low monthly payment. they make you feel like it's an honor for them to help you out. i went from sleepless nights to getting my money right. so thank you. ♪

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happy friday welcome. another installment of "options action" is here. here's what's coming up on the big show tonight ♪ >> asth madonna once said, we ae living in a material world this is carter worth's world and he'll do the singing, thank you very much, singing the virtues of materials then lizzo once sang, where the heck my phone. tony zang knows. he's found t-mobile all up in his contacts he'll show you how to unlock