tv Fast Money CNBC March 25, 2022 5:00pm-5:30pm EDT
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restaurants. >> we love olive garden, unlimited bread sticks, everyone will want to go to restaurants, there's huge pent-up demand for that they're reasonably price with a lot of different restaurants in there. awesome place to be. the stock has got hit because of the earnings didn't come in as good as expected because of omicron so there you go. >> gotta go. have a good weekend. "fast money" starts now. live from the nasdaq marketsite in time square, this is "fast money", i'm melissa lee. tonight's trader lineup tim seymour, steve grasso, brian kelly and pete najarian, co-foudner of market rebellion. ahead on fast. rates rapidly rising inflation under pressure we chart the sector plus wild week for weed looming legislation by congress could now be the time to come back to
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cannabis and later, gamestop up over 60% this week. chairman scooped up more shares. are we breathing new life in this trade start with rising interest rates and 10-year spiking 2.5% today and -- oil back up today crude getting bump after attack on saudi energy depot and finished up 8.5% and second executive week up s&p led by energy, tesla and apple how can the market hold up with rates and inflation grinding higher, tim? >> we had consumer confidence restating to 10-year low on consumer confidence. color me very surprised as someone who seen rates move 40
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basis points on the short ends and the long end and at least 45 basis points in the last nine sessions since we were told what's on colin's minute and vix falling 40%. what equities is doing is extraordinary. doesn't surprise me right now we're seeing flight to quality into mega cap tech 2345i78s -- names where there is digestable valuation. i talked about how great a valuation i think google is. i think there's places to play and parts of the market even in a higher rate environment that you don't have to run for cover. insurance companies are doing well look at ki e, the insurance etf about to set new highs all state announced they will set price hikes 1.2% higher for their entire space i think it's difficult for stocks but not difficult for all of the stocks. >> we like to play lots of games here o"fast money." one of hur favorite games, many, if i told you what was going to
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happen on any given day or series of days what would you guess with the market reaction would be bk, i will go to you on this one. i told you all of a sudden markets are pricing in maybe citi group calls for four consecutive half-point hikes what would the market reaccess be would guessed higher >> i am going to give the same answer my lawyers give me, it depends. it depends on the mood of the market to me here's what is going on. there's a narrative in the market, what young kids call a meme the narrative is this, stocks are treasury inflation protected security tips with pricing power. tim mentioned all state raising prices and melissa, you mentioned inflation. everybody thinks stocks be able to weather this inflation airy storm because they have pricing
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power. the flaw is the consumer what we need to see is the consumer balance sheet is still well we still have good employment. what you saw with oil today, soon as it started to spike up that's when equities came down now we know that that's the trigger for the sell offs is higher oil prices. but as long as we have oil, let's call it racnge-bound aroud 100 to 120 dollars a barrel, the tips meme is enough given the sentiment how bad it was is enough to get people buying equities again. >> when tim said insurance companies, made me think of berkshire, insurance companies are collecting on that premium and now earning money on that premium so they have to pay a hit to their insurance play so i think you're okay with insurance plays. i think you're okay with people that have pricing power.
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utility companies. >> uh-huh. >> how about mcdonald's. i know pete likes the fill a fish. >> isn't it about the dollar menu. >> is going to be $1.25 menu. >> they have some pricing power, another thing, general mills, they have pricing power. jeff but they still conduct business in russia, maybe there will be a boycott of general mills >> i get the pricing power thing, i totally get it. >> i'm just looking at the stock charpts and utility companies. >> sure but how much can companies raise prices, they've already -- >> utility -- >> yeah, utilities that's different. >> different. >> pete, how many more ties are you going to pay up more for coffee >> and filet-a-phish fish >> i will pay a lot for coffee something to be said about pricing power, no doubt about it
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general mills, doing an outstanding job. i'll really impressed what's going on remember, also, when we stalk about employment, we talk about wages rising as well, there's a bit of a back-and-forth that we miss sometimes. i think the reality is this, we're seeing rates, the rates are rising, they're rising, maybe, the real key is at what rate will they rise? that's part of what would potentially hold us back, mel, is when you bring up half-point moves, i think that's something that will actually slow down the markets to some degree i think obviously the financials will probably do pretty well but i think that would slow things down in a rapid pace if they did four in a row! oh, i can't imagine. i think that would really, really be something that would effect the markets in a very big way >> in the meantime with -- i mean, we were talking on the 12:30 call, wage inflation has been a huge driver of higher input cost with inflation rising you to can have more people in
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the workforce to bring a better balance to the labor force, tim. >> i think that's right but i'm concerned the jobs aren't going to be there. the labor cost are a lagging effect the services inflation is a lot stickier there will be a lot of employers especially if we see follow through from $130 oil prices and where we where with the inflation chain. i think some employers will hold back on those jobs, people living off the government right now will not see those jobs later in the year. >> i asked the question earlier in the show, not sure i got clear enough answers for the audience to process. can the markets continue to go higher with inflation looming and rates rising, et cetera. show of hands, please can the markets go higher with this back drop okay [ overlapping speakers ] >> you got to give a qualification though >> is a back drop that citi
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portrayed today where there is going to be four 50-base point increases, then no it can't continue. can we go with quarter point increases and balance sheet reduction, yes. >> yeah. >> the move we've seen in apple, microsoft and google this week tells you i think there's a place liquidity can go and next 150 basis points of tightsening in the short-run i think you can see outperformance, we acknowledge the move off the lows you have to give me a time horizon on this. i think it will be tough to trade significantly higher from here and i think you have a case if you listen to powell last week he used the word expeddishously how quick they need to normalize inflation. they care only about 2% inflation target the world should feel good in terms of the credibility of t federal reserve but not great for long-term stocks
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>> pricing power, mega cap tech have outperformed in the most run up, a lot of them are technology companies would you say, yeah, that's the way to go here >> i actually -- no, i think you go to the energy sector. that's the heart of the matter because look at exxonmobil with 4% dividend yield and tailwind from higher oil prices and does certainly have pricing power to me that's where you want to put your money the risk of course is ultimately the administration is not very friendly to the oil companies an don't want them to make much money so they are hit with windfall task. that's the risk. meantime i think you stick to the energy sector. >> yeah, pete your playbook here >> yeah, i agree with bk, you actually trade the energy sector through options, don't do it through the stocks, you are getting absolutely unbelievable moves right now in the options world when you are talking about energy
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i've been talking about this for a long time. last night as well what we're seeing in the energy sector every single day, and added even more today to it in the calls side of things, boy, the results are absolutely almost immediate it's amazing how much they're going to the upside. you're just shaking your head whether it's occidental or apa, anthony marathon oil, go through the big beta names it's an unbelievable rush to the upside, granted they go down just as far as they go up, so there that's side of it but as far as a trade it's a great opportunity for energy when you look at big tech cap names i'm absolutelied loaded up in technology and energy right now. probably more than i should be third, i'm looking at the banks as well because the banks have been doing very, very women well
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with 10 year specifically. >> energy, record gas prices hitting consumer bottom line off the charts cost -- a come worth the pain, let's get to carter worth what are you looking at >> think about what would the worse possible thing one could be in right now? a boat company like brunswick or polaris or harley davidson, winbago. they are purchased with leverage and you drive it around with high cost with gas soaring and then you have foot locker, mcdonald's, urban outfitters, you can see the pressure in the stocks let's look at some tables. first, this is a trailing 12-month fact. s&p despite it's volatility is still up 16% the consumer consumer
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discretionary sector is up 11. and the equal weight sector down 1.7. that really tells the tale look at the kpcomparative chart, s&p, compared to spider with everyone from james amazon, wall mortgage to foot locker. look a walmart to foot locker but look at the divergence, something is wrong. another table. 6-month trailing performance. k rox, foot wear down 50% nothing to do with each other. these are random stocks to make a point. that's bad action. compared to bottom xrt down only 18% that is much worse than the s&p. it's a bad set up. let's look at two more charts.
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first comparative chart nike versus lulu. you see lulu is up against the down trend line and the question is is worth it i were long i'd sell cows against my position calls against my position. i had a critics' choice critics' choicehoice >> i would do exactly what carter said. i own the stock and selling calls against it multiple years and continue to do so. because i think there is upside. i think there's significant upside to lulu and it's gotten to an interesting pe level after the big drop it made but when you look, athleisure is still there. when you look at e-commerce and
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online sales, in-store pick up, and everything, i think lulu is doing the right thing and i think they'll have pricing power at some point, don't know if they have it now, they are still works like many others through the supply chain, don't want to use that as an excuse but i think that's something that's loosening up and we'll see the stock start to soar again. >> if you look at high-end names like ralph lauren i talk about capri holdings all the time up 20% off the recent low i would invest in what pete said, pricing power, that's the theme. higher end names is where you would want to invest. i would buy lulu at these prices if they follow the same pattern are only up 5 or 7% from the low. they are bouncing off technical levels where even though he's saying they are on the way down, what was the way down? supply chain interest rates, right?
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so are they going to be there in the future >> are you wearing lulu's right now? i'm sure pete it he loves his athleisure. >> these are definitely stretchy, but tim, seriously, the supply constraint will be loosening, that's the last leg of the downward flush. >> i'm not sure what they are but they're moss green coming up, marijuana madness -- don't see that color often especially in man's pants -- will these stocks go up in smoke or light up your portfolio. that trade and many more puns next. and the chart of the week has been in monster rally mode since mondays. stick around, we'll reveal the name much more fast in two. what if it's a company that's pursuing 100% renewable energy in our operations. and aiming to protect millions of acres of land.
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fly higher, tim, just earlier this week mna, you said that any sort of federal move to decriminalize all this is not a reason to invest. >> i just believe there's growth, there are real companies. they're going to get the tailwinds. the big ones are getting bigger, crest co and others, the deeper the moa t the more you push away others and better their business the new jersey vote a little bit disappointing. they will be in the game in a big tway we know about new york. this week about mna where you reset expectations the moore act you need to see senate approval to get cannabis legal in this country. what you did have the senate approved a research bill unanimously so the fact the senate is agreeing to look at the plant and study the plant, gives a lot of constituents in the senate an olive branch to get off the ledge that's what
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the market saw canopy growth up 60% in nine days it's the names that people can buy. not necessarily the u.s. names with the big week. again, i think some of that is short covering that alone is not fundamental. it's part of a change in character here and a lot of these stocks are well above 50 these were big buy in moves this week let's see. >> tim brings up an important point you can't invest hoping it will be federally legalized tomorrow i don't think it will get in front of the senate, not because they don't want to, i don't think it will get out of the house. i don't think the people supporting it agree on how to get it out of the house. the senate, way too much in front of them to get it in front of the senate. >> pete, i wasn't on the show last night but i believe the final trade was cgc how will you play this with 10% pop on the day. >> right only through options i kind of view these stocks as extremely volatile like other
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names in the space, we talk about chinese names, so forth. in this case these could move up fast and also to the down side, i'd rather be in options we saw options in just about every single cannabis stock yesterday in the final hour of trade and even toll till ray calls being bought, it had a monster day to the upside. how about 300 million shares, tim, that's a monster day, i mean a monster day, that's about ten times normal volume. gives a little bit of an idea how excited people are right now in the cannabis industry and they're all looking very, very short-term for this move they're all looking at expiring options that expire next friday, looking for these moves really quick today as well as next week, mel. >> all right coming up, take a last look at the chart of the week, here's a clue, it is up more than 60% this week, flat on the year.
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up this much in a stock that is a meme stock, you gotta take some off the table here. pressing against the 200-day moving average at 165 or so, i think it's a tough buy at this place. let it settle down a bit if there really is something to this story and there's legs to it you will have all kinds of time to buy this. >> pete, how happens the options volume been on some meme stocks, we certainly see the price action in the stocks. >> yeah there's been some great volume in the options, mel, no doubt about it i think when you look at gamestop obviously the insider buying was a trigger let's not forget this is still a stock that fits into almost what it once was, in terms of it still has a high short-interest, nothing like it was but still 16% of outstanding shares are short. so there's plenty of rooms for squeezes i agree with bk if i were lucky enough to have been in it this week i'd probably be out right now. >> think about the week we had,
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tells me where the market is, bk's bitcoin had a run quietly look at the vix pressing low 20 maybe breaking 20. again, there's other things, dollar yen we could spend a whom show on this but the fact dollar yen is getting near record high is risk aggression market. this is last gas on meme stocks. what's going on with rates will be painful on revolving debt. i don't think there's that kind of cash lying around. >> so margin. >> yes. >> time to go around the horn, "final trade", pete najarian. >> i like the iron ore from brazil i think they're going higher. >> brian kelly >> i'm going to give you exxo exxonmobil like that oil from texas xom. >> what about you tim? >> mexico as an oil economy also has reasonable outsources with north america, currency is a
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tailwind, i like eww. >> steve grasso. >> i'm going with capris you know what their color is, moss green. the color of the year. be on the look out, everything, this color is coming back or getting in, i don't know if it was ever there but it's there. pray. >> only on your pants. that does it for us here on "fast money" do not go anywhere, i'll give you "options action" up next thanks for coming. now when it comes to a financial plan this broker is your man. let's open your binders to page 188... uh carl, are there different planning options in here? options? plans we can build on our own, or with help from a financial consultant? like schwab does. uhhh... could we adjust our plan... ...yeah, like if we buy a new house? mmmm... and our son just started working. oh! do you offer a complimentary retirement plan for him? as in free?
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it's friday and it's time for "options action", i'm melissa lee, live at the nasdaq marketsite in time square here's what's coming up. >> carter worth completes his offensive/defensive trifecta with one of the lowest data longest established health care names that can be found. then tony zhang takes an opposite, but still complementary tact on a staple name that might be about to lose its defensive fizz finally, earnings season never really
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