the ibb, amgen, biogen, celgene, gilead and one other, make up 5% this is playing some catchup, new 52-week highs. those 2015 all-time highs are about 10% away that's the constructive nature i see. i like my lines here, carter if we are going to continue to make new highs, this is going to play catchup because of the weighting of these five and their valuations i think you want to look at market expiration. this is at 52-week highs i like using options to define my risk here implied volatility is relatively low. i looked at march expiration when the stock was trading, the utf, 11775 you could buy it 120130. call spread, buy one of the par 120 calls for 255 selling one at 25 cents that gives you that price of 225. that's your max risk i am targeting that and defining my risk and i may get the entry wrong. it is at a 52-week high. if you think they are going to have continued momentum, this is wait to play it. >> what did you make of those lines? >> what we are looking at is the equal weight versus the ibb, which is market cap weight if the equal weight is making new highs, the big names

the ibb, which are the top five names, amgen, biogen, celgene, gilead and one other make up about 35%. this one is playing catchup. we have a five year chart here it made new 52-we can highs but those 2015 all-time hey highs are 10% away i like my lines here carter. i think if we are going to continue to make new highs this is going to play catch up because of the weighting of the five, because of their valuations and because of this rotation to he moo, i think yought to loo out to market expeeration and the 52 week highs. like using options to lessen my risk here. you could buy the march 120-130 call spread paying 2 and a quarter. that gives you that price of 225. it is the max risk of it's 2%. what eye like is i'm targeting that prior high, near 130. i'm defining my risk at 2% i may get the entry wrong it is at a 52 week high. but if you think they are goin to have continued momentum this is the way to play night what did you think of those lines >> dan started with this, the equal weight versus the market cap weight in other words if the equal weight is making new highs -- actually

. >> gilead. sticking with the biotech thing.g, gilead >> what show is come up next >> "options action." >> 5:30 every friday >> dan nathan, mike khouw, carter bronx ton i'm going to see the eminem guy with dan nathan. he asked me to go. ♪ please stand up. >> they won't let new if you do that >> it's on the board netflix. >> does it for us here on fast we will catch you monday at 5:00 for remo fast. as guy mentioned, option actions starts right after this break. let's begin. yes or no? do you want the same tools and seamless experience across web and tablet? do you want $4.95 commissions for stocks, $0.50 options contracts? $1.50 futures contracts? what about a dedicated service team of trading specialists? did you say yes? good, then it's time for power e*trade. the platform, price and service that gives you the edge you need. looks like we have a couple seconds left. let's do some card twirling twirling cards e*trade. the original place to invest online. >>> hey there. we are live at the nasdaq market site the guys are getting

for patients going guard and that is really the story coming out of this conference is, you know, gilead is changing back into a company that for the long term will be a growth company. >> we look forward to hearing more about that in the year ahead. >> i look forward to talking to you, meg. >> guys, we got another great sbrir co intery interyou coming up in the next hour stick around for that. back over to you >> thank you, meg. see you later. thank you, mr. milligan, for joining us i truly believe, we're in the early ages golden age for biotech bnology. >> absolutely right. the kibnds of cancer people hav, lengths of time, the curing we're seeing happen is transformative interesting thing to me, as well, a company like gilead who had come out with this dramatic hepatitis "c" treatment as well but the market is relentless it wants its next act. it's been fascinating to watch them buy kite and figure out what that will be. >> great stuff. >>> all right. we have 39 minutes left in the trading session here off to the races again the dow up 130 points right now. it is the best performer of

look at gilead, and 12 sometimes multiple >> is celgene a partner? would they be an obstacle?n't think so. >> guy >> me or dan at t tesaro has had a -- what's the point? better to buy these stocks when they're down than to try to pay up for them. i think pfizerless the comes in, they have a ovarian cancer that works. >>> let's get to mike in austin to break this next one down? >> not necessarily some kind of a match, but allergan, two times the average daily call volume, the most active. over 2,000 of those traded for an average so these folks are making a bet that allergan will recovered. >> what's going on >> on the "fid hdler on the roo. >> pete knows all the shows. >> he knows all the lyrics it's amazing check on the full show on friday, 5:30 p.m still ahead everybody twitter in trouble, and now a top executive might be jumping ship. are you buying what dan nating is selling vote on our poll at cnbc.com/fastmoney much more "fast" straight ahead. you traded options. t i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well

sciences see gilead higher, higher, higher and it than really taking a hit. also higher on the amazon, berkshire hathaway health care consortium. some of the other big names in the mbi overall are affected. shery: with midterm elections coming up i can imagine this would be an important issue. abigail: and for president trump its very important. because right now republicans have in place a drug pricing mechanism that keeps the government out of the picture. insurers are negotiating with drug companies but if democrats take the house, something that's possible, i see your eyebrows will want tocrats put in mechanisms where the government will be able to take more control over the pricing situation. if that were to happen, who knows, president trump could truly become a bipartisan president around this issue, at least. shery: this is going to the markets and what the stocks do. abigail doolittle, thank you so much for that. david. david: thanks, shery. president trump covered a lot of ground last night but one thing he did not address is the robert hisler inves

. >> gilead is still cheap. >> i'm not sure i want ton overweight in biotech since hmos by the way havey lagged in the last couple of weeks. they have been great performers, but i still think there's more upside in that particular subsegment. >> united health, liked that. >> gilead with 40 billion sitting overseas. >> but no mo they got in to buy somebody. >> made a little acquisition made an acquisition and the stock popped and then pulled all the way back down again. >> i looked at insight, everything seems to hurt this group, everything. >> all right we'll see what the conference does maybe something happens happened jump starts things. >> next up, the baltimore-based brokerage stock tells one big wall street firm what to buy today. before the break, the sector check. the s&p is a fractional loser today and utilities are leading the way. we're back on "halftime" in two minute >>> we're back t. rowe price getting upgraded at bank of america to a buy increase the price target as well to 125. that's the highest call on the street and why it's our call of the day. what do we think of thi

gilead, what i like about them is yes they have made an acquisition. i think it was a catalyst for the company. what they are doing in cart t, what they are doing in the cancer space is very important because the hcv business, hiv business are ones where people question whether they are going to stay as profitable or be a victim of their own success. they are stabilizing i sense with the top four biotech stocks there is a lot of news in the stock, the valuations are good, why not own the whole thing. >> what concerns me is later in 2018 when the midterm elections come into play and the issue of drug pricing has come to the fore as we saw in 201. >> i think it's easier to make a case that the government coming after these tech monopoly is going to be a much more focus. >> the regulatory risk is bigger in amazon, google, facebook, that sort of thing, when you think about the monopolies and the power they have, the lower tax rates, cash hoards, billionaires running these companies. >> whatever you want to call it, we are at a place where a lot of the comp

it's 150 plus stocks five stocks are up 40% of the way, biie, celgene, gilead and so forth you are bettingn the big ones. the issue is this. even as equities are going higher still, does this group play catch-up? i would say yes. >> that's the bet. >> mike, final word? you want to respond to bk here >> i look at a name like celgene, that's the one thing that troubles me i probably would agree with him. that's why i'm looking at a broader basket of stocks that are doing a lot of it innovate thin ive things ibb might be one of the ways to do it. >>> still ahead, energy stocks coming back from the dead, surging nearly 10% in just the past three months. mike's got one name he says could rally even higher. i'm give us the details. >>> got a question for one of our traders? of course you do send us a tweet t to @optionsaction. see that's funny, i thought you traded options. i'm not really a wall street guy. what's the hesitation? eh, it just feels too complicated, you know? well sure, at first, but jj can help you with that. jj, will you break it down for this gentleman? hey, ian. you know, at t

other than kite, which has been purchased by juliette, -- gilead, juneau is another one that has notn purchased. mark: it is time for the bloomberg business flash. a look at some of the biggest business stories in the news now. take news in the pharmaceutical industry. they agreed to buy this drug maker for $11.6 billion. sanofi is looking for new products to offset the kleins for its best-selling diabetes drug -- declines for its best-selling diabetes drug. there are reports that the coo ofset to become the next ceo sofi. let's take a look at where you are up in markets are trending as we head to the close. stocks are mixed. the ftse lower, the dax higher, cac 40 -- check out the currency boards as well. arriving aheadu of that. mark: lime from bloomberg -- live from bloomberg headquarters in london, this is the european close. stocks finishing up the day in m ago,n trading, w london lower. most of the european boards hire. the stocks to 600 gaining for third day. highest level since august 2015. 69.s at three weeks of gains through last week. best run since october. want to tell yo

i do think the science works in this space, and i think we can own names like am again and gilead hereey with the board? power pitch? >> what show are you on for the past 11 years? >> happy anniversary, by the way. >> happy anniversary if you like the science, you have to buy the people who service biotech. >> how about acquisitions? what happened to acquisitions last year? >> and there's still all that cash on the balance sheets i think on some of the big farm oohs does pfizer decide to make a move somewhere in the space? >> like a big move >> and will they make a move or who is going to make the move if you're looking just for the stock itself to prime minister, you're looking at a biogene, a look at misother names, but no doubt about it, those are the names that are being looked at for acquisition. >> so forced to choose, i.b.b. or x.b.i i would think make you go for the x.b.i., because that's more mid cap-y. >> i like at the ibb, that's a chart that's stills off its lows i don't think this is a driver for the sector right now maybe getting rid of bad m & a, but to get that, not as

big pharma and biotech have a lot of cash to spend from gilead and amgen to pfizer and merck.aird research breaking out overseas versus u.s. cash in light of the tax overhaul here many signaled greater spending many investors expect and hope more deals who are the most likely targets? rbc took a survey last month and the results fall into the pattern we see frequently in biotech deals. companies that make drugs for cancer it could mean $2 billion and $10 billion. there is clovis oncology, kooma biotech, blue bird bio, a cancer and rare diseases and novexis with a focus on rare diseases. a lot of speculation going on in biotech. people are hoping that 2018 is a big dearly year. >> also, meg, just on your beat, there had been some reports that there would be interruptions to flu monitoring you're saying not true >> no. it sounds like the flu is going to continue the federal flu monitoring the reports getting from states and counties there was some concern as the severe flu season goes on we wouldn't have the cdc monitoring it but they are continuing with the activities even as o

then when it is too expensive like gilead charging $1000 a pill for help seek your then we tell people that show up that are infected sorry, go home, you're not close enough to just yet and you don't qualify for coverage. this is the united states of america not in the middle ages but in 2017. severe pain 70% of our gross domestic product for healthcare where all the rest of the countries that we compare with with higher life been ten-12%. ladies and gentlemen, that is a trillion dollars difference a year of jacked up prices in the united states. that is what that is. goal number three, investing in our children. you have to be pretty damn weird to not want your children to succeed. right? americans want good schools so target number one, one 100% completion of quality k-12. goal number two, past the higher education including technical training without debt, without debt back third, early childhood education for one 100% of our kids. [applause] we are earning $60000 a person a year for every man, woman and child in this country, don't tell me we can afford universal pre- k. can. so th

. >> gilead. >> just come back over. >> i'll come back over. >> oil trades from the futures pit. we'll do that next you remembered. it's good. does it make the short list? you remembered that too. yeah, i'm afraid so. knowing what's important to you... it's okay. this is what we've been planning for. thanks, bye. that's what's important to us. it's why 7 million investors work with edward jones. dad promised he would teach me how to surf on our trip. when you book a flight then add a hotel you can save. 3 waves later, i think it was the other way around... ♪ everything you need to go. expedia. >>> welcome back to "the halftime report. i'm jackie deangelis we're watching crude oil rallying today again and on pace for its fourth week of straight gains. what's your outlook here >> oil has had a huge breakout above the $60 level which is key. the technicals, huge head and shoulder bottom here listen demand is up and supply short. some geopolitical tensions going on pushing crude to the upside. seen the hedge funds add 90,000 contracts year over year and that also putting prices to th

tons of money. $41 billion for gilead, $41 billion for amgen, pfizer. baird research they have a lot more fire power than just what they have listed there. people are expecting deals will come that drives a lot of the take in biotech. >> meg, thanks very much for that. >> interesting to keep watching for the banks. those are very strong air why is. >> the banks >> you pivoted from biotech back to the banks. >> m&a. >> you're right. >> goldman, too, had a massive quarter in the trading weakens still, i always pivot to banks going to pivot to politics the senate is going to vote on a funding bill to get the lights back on in washington. ylan joins us with the effects of the shutdown at the irs. >> reporter: wilfred, washington is in shutdown limbo i am outside the headquarters of the irs. this agency employs about 80,000 people across the country. more than half of them are on furlough today now if this was any other time of the year even more people would be staying at home, but the irs says that because we're in the start of tax filing season, it will c

let's start off about the gilead, very volatile stock when you look at this chart and got into this areare it's chopping around in the mid-70s somebody came out on the may 90 call 10,000 were bought for 80cents pretty aggressive buying in there. waiting for something like that. got the healthcare conference going on right now i wanted to see something in a positive way in any of the biotechs, this is the one that stood tout for me now and is hitting. i bought the stocks. the i'll sell upside calls against my position for the next several months watching this stock hopefully making a move up around 80. bought these around 80 cents and the stock around 76.60 when they purchased the calls. got a financial on top of that though kkr. >> you better after i said you did. >> very aggressive buying in kkr as well today. this is something we always love seeing when somebody had a winning trade hand now they want to roll it up. so, in other words, the march 22 calls, they were bought today with 52-week highs those are getting taken off. 5,000 of those were sold, but they are rolling them to the mar

competition coming and a lot of pricing pressure, not just from generics, but also gene therapies and gilead you going to do about it? david: it is a $25 billion market around the world. it is growing. probably too much. somewhere around 38,000 americans knew the diagnosed this year. we have been growing very fast. we continue to invest. we are particularly investing around dual therapy. they are treated with three or four active ingredients combined in one hole or two pills. we think there is a real opportunity of patients potentially living multiple decades. could live five decades, six decades, to really focus on long-term safety. we are investing in dual pills.es, so smaller also, long-acting formulations. i mean, you are right. potential lot of new, science being looked at for long-term cures or even functional cures. they are quite experiment and early at this stage. for thereally makes up foreseeable future the backbone, but we are investing in those research programs, and we will he where they go. i think, for now, it is dual therapies, long-acting. eric: one that question before i f

stocks is and speculation that more m&a will follow the companies with the biggest piles of cash is gileadrck, j&j according to baird from clovis oncology to bluebird, which we're seeing that stock up quite a bit. people hope those deals are coming back in 2018 for biotech. >> we just said the best start to the area since 2007. >> big start. >>> up 115, record territory for all the major averages we have the closing countdown in a moment. >>> as we head to break, here's another check of those netflix shares company gearing up to report fourth quarter earnings in a few minutes. it'sp reha umo tn 3% heading into the close you're watching cnbc, first in business worldwide driving specific sectors of out performance. where a rising middle class powers a booming auto industry. a leap into the digital era draws youthful populations to mobile banking and e-commerce. trade and travel surge between emerging markets. everyday our 1,100 investment professionals around the world search out opportunities for alpha. partner with pgim, the global investment management businesses of prudential. show of ha

january first or as of this week allergan raised the price of a dozen and a half drugs by 9.5%, biogen, gileadraising prices of drugs. these are the list prices of drugs, companies like to say this doesn't include the rebates and discounts we pay back into the system they'll be getting more revenue by two to three percentage points this year probably. so drug prices are going up. >> for some drugmakers, i'm sure, drug prices are keeping a cap on how much they increase and it comes at a difficult time and we got news that allergan will cut a bunch of jobs >> allergan is in a tough place right now and they're losing xfrity and that's one of the things they've been talking about about having to cut the jobs and that's where the revenue will go to. >> thank you >> meg terrell. >> thank you >>> melissa, thank you very much here's what's coming up on "power lunch." freezing temperatures keeping consumers at home and there is colder weather on the way. we will talk to the billion dollar buyer himself about the chilling effect he may be seeing on business. he's got a lot of consumer-facing businesses

. >> it remind me to the gilead -- >> one of the by owe techs looking for an immunotherapy cancer play. juneau is midsize. >> what do you think about the price. >> looks like the way the stock traded up to the stock's recent highs, which were only six or eight weeks ago. clearly the buyers being opportunistic and saw the stock break. no tell on where it's going the settle out for a bid price. >> 40% pop on news reports >>> meantime, the results of the president's physical are in. kayla touchy has the highlights. >> reporter: whouz physician dr. jackson reiterated he is in excellent health, 75 of ins tall, 239 pounds benefitted from a life of abstaining from alcohol and tobacco. all of his tests came back recall no. all of his labs are recall no. he is on prescription medication for elevated cholesterol and has been some time he and the president are discussing an kper advertise program targeting weight loss of ten to 15 pounds in the next year the doctor also conducted a cognitive test at the president's urging and he scored 30 out of a possible 30 overall on the montreal cognitive ass