great to be with you and adam parker as well. i knew that coming into the quarter that it was a bit stretched. we had five straight months up, a 10% first quarter and we were likely to see some type of pullback. when we had 10% first quarter you look the rest of the year, 10 of 11 times but the pullback that you see at some point is 4% and the average is deeper than that. so i think the market that is stretched, there were expectations that moved up and we saw volatility and interest rates and inflation and we are having a bit of a reset which likely has longer to go in time and price but as you discussed, the economy is still relatively resilient, every week we see-- making a new high and what does that 10 year yield that breaks this market? before the financial crisis the average since 1950 was about 6% . the average cash rate was about 5 and the equity market as i alluded to grew about 11 or 12%. i think rates moving up at a fast place really caps the upside and provides some choppiness but credit markets are really well behav

up trend that usually means you go into a consolidation, refresh and break out higher again and adam parkersut out a note that he's less bullish, because maybe china is not recovering like we expected it to, whereas you say you're becoming more strategically bullish. how so >> that's interesting. i know adam, but not his research that said, we made a tactical call on china back in early february i will be the first to say it was luckier than good. that was a tactical call sometimes that call will turn into a strategic because, because we start to see evidence the trend is changing. we saw a breakout to hong kong, the kissing cousin to china. we're seeing a 65-day breakout in the shanghai 300. the 50-day is not yesterday through the 200 day, but incrementally, build by build, we're starting to see better things happen. i think it's reflected in some of the metals we're seeing globally maybe who we're seeing is the about rates here will end up putting a lit on the inflationary pressures, but at the same time the batten gets passed to china, and they start to help buoy growth. we think the mark

now, with all due respect to tony at goldman sachs, there was a note from adam parker, enough so that i was like you have to come on and talk about this because this is a bit of a change i want my viewers to know about. adam joins us now. it's good to have you back >> good to see you >> you have made a bit of a pivot, if i can call it that i want to read the headline that i took from your note and we ask discuss. our recommendation had been that the bull case was far more probable than the bear case, driving our judgment that there was an upside to the s&p 500, but now our view has changed that got my attention. why has it changed >> the three pillars to the bull case were easing financial conditions and growth margins expanding and the belief that earnings would grow, and there were a tightening set of conditions and a china recovery. we try to mark to market our views, and i have no idea right now if the net 10% moves up or down, and so i think the way jim framed it makes sense to me, 50/50 we move in either direction. why? one, the stagflation, like i wrote in my notes, if stagflat

. >> adam parker, bryn, suggests nvidia and the earnings report is the most important data point of the entire earnings season. do you agree with that? >> first of all, adam has a long history in semis, so i always want to listen to what adam has to say in the semi space. absolutely. because the only company -- the only company outside of super micro, but the only big company that's really delivering on a.i. is nvidia, because when you get 11 trillion made up of five companies all buying the same product, you get nvidia's outcome. i think you still want to see nvidia continuing to have these really big beats and guide higher. i think nvidia is going to be incredibly important. i think microsoft is second to that because they're actually monetizing copilot. i think those are the two most important a.i. stories this quarter. >> a.i. is going to get a good test next week when the mega caps start reporting. jason, you've been trimming nvidia late. are you concerned going into this quarter at some point they're not going to measure up to where the hype machine has taken the stock? >> i don't

let's ask adam parker, the founder and ceo of trivariate research. with me once again at post nine. >> good to be here. >> new quarter, same story for the rally? what do you think? >> we looked back -- our data goes back to 1928 in our database, and there's been 12 times previously where we had double-digit returns for the s&p in two straight quarters. we were up 11 in q4 and 10 in q1. i said, what happened in the quarter after that? if you look back, the average is it worked another 4% on average and only one time were you down double digits, q3, 1975. so, the data is not a massively statistically significant sample size. >> it's not an exact science or anything, but the trend is your friend. >> 9 out of 12 times, it was up. only one time it was bad out of the previous 12 years. history doesn't say, oh, i had two great quarters, let me throw everything out. i would say, you know, the trend's your friend, and i think this week's big if we get any negative prereleases. i don't think we're going to, but everyone dots their i's, crosses their t's, and m

adam parker will be with me.t what he thinks about this choppy market, we'll call it that. keith learner, we'll have a conversation later. and brian moynihan will be with me. let's do "final trades." josh brown, start us off with a name on your mind. >> yeah, throw this chart up for me. this is applovin, the number one performing large cap stock of the year, in the midst oh of a very low volume pullback. haven't pulled the trigger yet. >> let us know if you do, but that stock is up about 2.25%, as we talk about it here. farmer jim? >> cvs. this is not a slam dunk either. it's been a terrible stock. >> call it a dunk. >> it's been dunked on multiple times. let's hear what they have to say when they report earnings next week. >> i like free port-mcmoran. >> i'll see you on "closing bell," everybody. "the exchange" is now. ♪ ♪ >>> welcome to "the exchange." i'm in for kelly evans. here's what's ahead. the bond market still keeping stock gains in check. this as we prepare to hear from fed chair jay powell and we'll b

think that will be extinguished this year >> let's throw up nvidia the stock has been i correction adam parker makes the case thi week sitting in the seat i which you are today, that this is the most important data point for this period given nvidia earnings and you agree with that. because there is no bigger booster of this stock than you and very few who come on the network have owned it as long as you have and you agree with him >> i think it is their commentary they sit at the epicenter of what is the biggest story on planet earth right now i hope jenson wang understands the weight of his words. he is a straight shooter and tells it like it is. i have been invested with nvidia from 70% draw downs. i understand what it is like when they are having a great quarter and a terrible quarter but what changed now is how high the stakes are for every other technology company based o demand for a.i products, a.i. infrastructure, a lot of it is balancing on what he is going to come out and say remember when i said semis are 9% of the s & p, nvidia is 50% of the 9%. it is 30% of the exposure in the na

. >> here's the checklist from adam parker. accommodative fed. check. gross margin expansion. that remains to be seen, but he's optimistic about it. earnings growth for several years. we have had, you know, earnings decline for three or four straight quarters and now we are coming out of that malaise and we will have earnings growth this quarter. it may be ratcheted back from 10% to now 5%, but why can't that scenario, weiss, work? you gave a look with a little skepticism. >> there's a lot of hope in that scenario. >> is there hope? >> we don't have an accommodative fed yet, do we? it's a restrictive fed and they will be restrictive when they cut two, three, four times, it's still restrictive. >> the market is anticipatory. it moves before you have. it starts to go down before you got the first hikes, and now it's going up because you are getting ahead of the first cuts. >> it discounts the cut in the market up a year in advance, and have we seen that discount already, given where the market is, number one. number two, we don't know -- we know that historically that this type

adam parker, for example, if he was here, would make the argument why he is bullish. he says margins will be much better than people think and that's what matters more. wages coming down, input costs, inflation coming down. prices are not really coming down. prices remaining up. markets are protected. stocks go up. that's what he would say. >> earnings dropped in q3 of last year. we have seen a broadening out of this rally. not just the u.s. a story but the global story. 70s percent of stocks trading above average. when we reach the end of some type of bull market, you tend to see leadership narrow. you're seeing the resiliency in earnings. we raise our earnings forecast in terms of growth we are at acting to see this year to 8%. it's not knocking it out of the park but you are seeing a much better backdrop. i do want to hit on this idea of a rate cut. i think it is important psychologically to markets. this idea that this is the trajectory that we have hit peak rates. there is a rate cut on the table. i do think it is an important signal to markets. if it's something

i'll see you at 3:00 eastern with adam parker and anastasha am rma ammarosa bryn, give me a final tradeshortage here the etf has been basing in the 50s. it's a good entry point. >> okay. steve weiss? >> meta. a penny for a pound. i think they th're going to bea the corner >> goldman sachs, i still think there's more upside ahead. soz we're still in the red across the board, but we'll have an interesting finish as we take you up to that meta release and tell you what to watch for you'll hear from shareholders, as well. "the exchange" is now. see you at 3:00. ♪ ♪ >>> we'll be there with you, scott. thank you very much. welcome to "the exchange," folks. i'm tyler mathisen in today for kelly evans. here's what we have on the docket the bull market has room to run, and the recent volatility has presented great opportunity. that is according to one of our guests today he's here with what makes him so optimistic and the three names he likes right now >>> boeing's loss may have been smaller than expected, but it was an ugly quarter. we have the latest on earnings and how quality control issues

. >> the only thing that would upset the bullish narrative from here, as lauren said and adam parker writes, the most significant challenge to that outlook, at least in the near term is tightening financial conditions that would cause a market selloff. we can agree that if you had a sudden tightening of financial conditions through the credit market, not necessarily the equity market, spreads are tight, not seeing that now, but that would be a potential game changer. >> i think so. one thing i want to point out market financial conditions are credit and equity prices. it comes down to why would financial conditions meaningfully tighten. that's all about growth, earnings coming in, meaningfully under expectations, turning negative, or the labor market starting to crack. until we see meaningful signs of those things, any sort of consolidation i think is a buy from an equity market perspective. >> the blood flow of the economy can do just fine if the stock market has a correction, for example. >> of course. >> it gets a little bit harder for it to flow if you have much tighter credit. >

i want to come to you first, because as i read your notes, you are not nearly as bullish as adam parker. why? >> i think this is just the evaluation. especially what you know about long-term yields, having increased the way they have. basically, equity is flat, right? whether you are in the tenure, the s&p, you are getting about the same yield. you could argue that the gross weight is what makes the s&p having the flight at, but i would say here in the 5000, 5200 area, you are close to fair value, so if you get a bigger pullback than what we have had thus far, i think we get interested. here, i think it is okay just to be neutral. >> you say it is time to be cautious. let's be clear, right? >> we have been saying for some time to be cautious. we are pretty much back where we were in february. we think this pullback could surprise to the downside. the market is finally coming around to what we have been saying for some time which is that the fed is either not going to cut as much as the market anticipates or they might not cut at all. i would say that is probably a much bigger risk even

add adam parker gives three reasons for the resilience of the rally, which he says accommodative fed, right, that's to your point, gross margin expansion, and earnings growth for several years. remember, we're coming off of three consecutive periods of bad earnings. we expect the tide to turn this quarter. >> that's exactly right. and when you look over -- this has really been a micro market, right? the market is now caring about earnings. we've seen earnings be the driving component of stock price appreciation this year. not so much valuations. and then i think when you look underneath the hood, right, obviously last year if you teased out the max seven earnings growth, earnings were negative for the rest of the market. when you actually forecast out to the fourth quarter this year, so fourth quarter of 2024 over fourth quarter of 2023, obviously you know, comps are going to be a bit favorable, but the rest of the market is expecting earnings growth of around 15% by the time you get to the fourth quarter, whereas again the max 7 or the fab five so to speak are actually going to be co

december of '22 let's discuss the market setup as we go into the busy week of earnings try varent ceo adam parkerrsation. >> good job. >> are you on for the review. >> are you on the lookout for brown chutes as he put it? >> is that what he called it >> yeah. >> i think the u.s. consumer g at sara's point, we take in ability 20 variables and think it's in pretty good shape but slowly eroding if i gave any of you that project for this afternoon that's what your conclusion will be when you put it in there. the reason it held in, you nailed it, the wages and jobs environment is still pretty good and when you kind of add up the income statement, income statement for the consumer, that's your revenue analog how much they're working and making i think it is the key -- one or two key things to monitor if we get a slowdown is the erosion of the consumer i remain optimistic, to be honest with you. the risk-reward still skewed to the positive where you ended the conversation, the input costs aren't a problem and gross margins go up for the average company. why do i keep liking stocks? financial conditions

but parker talks about genesis 127 that we're all creating image of god. i hate to inform him, but adam and eve were not embryos you know, they they're only part of our human tree were created as human beings to begin with. so to suggest that that line from my indicates that human life is equivalent to what adam and eve were as full grown individuals is abhorrent to me. okay. so just any if anyone has a quick thoughts about those really. so the the sort of there's always a problem with judges using the bible the way that the scottish writer andrew landes said drunks use lampposts. which is which to say for support, not for illumination, but if i could try to sort of tie this, tie that thread together, i mean the larger point. so, you know, not that long ago, the supreme court handed down a major ruling where it basically tried to get out of the business of micromanaging religion. and there was an opinion in 1990 by a crazy liberal justice antonin scalia called employment versus smith and the to that in both a of states and at the federal level were statutes to protect religion. the reli