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Foxy. Welcome to Halftime Report. I'm Scott Wapner. This hour's focus is on why one prominent market strategist says the much-discussed AI trading will soon be back on track . We will discuss and analyze this forecast with the investment committee. With me today: Joe Terranova, Carrie Firestone, Jenny Harrington, and Steve Weiss.
Let's look at the markets: green is everywhere . Yes, SpaceX is helping, as is Super Micro and the forecast we got. Ben Reitzes of Melius posted a positive note about what this optimism means for other companies. It's all adding up to a pretty good day at this point. This is Scott Rubner of Citadel Securities saying, and I quote: "Everyone is using the midterm elections as a level that becomes a de- risking event, and I think that's where AI will be able to outperform again ." The feedback we get from our customers is: "We're happy to buy more expensive, but not to buy now before a big political event." This really fits in with what we, you know, were talking about, and you're looking at me in disbelief, like, "Where's the praise, Scott?" This is Yes, this is You should have seen this view.
I mean , it was skeptical. As I said, one famous strategist, and he's like, " So, am I going to be on Closing Bell or Halftime tomorrow?" If I add shares of a semiconductor equipment manufacturer. "Because I think tomorrow I'm going to add shares of a semiconductor equipment manufacturer." So, Kevin, I'll let you know when I get connected.
I want AI trading. I want AI trading because everyone has rushed to seek shelter. They rushed to seek shelter, and positioning is incredibly easy. This is the hedge fund community. This is a community of portfolio managers who work with mutual funds. They rushed to seek refuge and we see that earnings growth will be there and they will have to quickly recover positions as we go through early November and you will see the optimism come back again as we finish 2026 on a very strong level.
I want AI trading. I want the momentum factor. What about you, Karen? Do you see it the same way as Terranova and Rubner ? A de- risking event—midterm elections, and a return to AI trading again? Well, I don't know if I see it as great as our fancy markets try to describe it. Um, I would say we had a bit of a setback.
This is kind of a test of whether we have good enough returns, which we'll start to figure out tonight with Meta over the next week to see if they're worthy of investor trust on a large scale. Remember, we're talking about $30 trillion in market capitalization of the 10 largest S &P companies. And to change this figure by 10%, a lot of money is needed, which must enter the market.
It's not like a few funds are trading stocks. We should have significant market movements. Many people are also adding to their 401(k) retirement accounts, feeling confident after what they heard. Will we hear good news? Well, we'll find out tonight . We'll probably hear that the news worked great for Meta in increasing interest.
I'm not sure if this translates into profit growth. We'll hear about capital spending, which is a big factor that's been holding back some of the trade because they're spending so much, and it's draining all the cash flow. But P/E ratios have declined. The only big-name company with a three-digit P/E is Apple .
You know, Nvidia is in the teens, and Google is just above 20. They've all adjusted to P/E levels that are acceptable in this market if we hear good numbers in the next 10 days. You know, Weiss, you were the one who became a little more cautious, I think, or rather, I don't think so, you said so yourself the other day when you were speaking.
You have significantly reduced almost all of your positions related to artificial intelligence. So you disagree with Joe and Rubner from Citadel Securities? I disagree because I don't think it's that simple. It's never that simple. So, with all due respect to our Perlman here looking into the future, you know, the future that I looked into showed a decline in ownership.
However, to say as a generalization that everyone has fled this trade is simply completely wrong. And I know you didn't mean it literally, you know, with that precision. Here's what's happening. I think there has been a rationalization of positions in terms of their size and concentration. I also think there has been a rationalization regarding the quality of the names you add to your portfolio.
So, which will you choose: Coreweave or Nvidia, which is selling for 10x next year's price as of January 28th? So , I think that's exactly what's happening now. I don't think the election will clarify the situation in any way, because you'll want to see how Anthropic performs during the IPO. You'll want to see what happens with rates and ongoing funding, circular funding, and where the weak spots are.
And this will not be resolved with elections. As for the elections, if you look at Kalsi and others, it is already perceived as a fait accompli that the Democrats will take control of both the House of Representatives and the Senate. So you see how that plays out on defensive actions. So the point is, I keep saying this: I'm not saying AI is over.
I'm just saying that this is a time when the tide doesn't lift all boats, and one must be careful in choosing. So I'd rather pick companies like, you know, Meta, like Alphabet, but even in that regard, you said the other day that even in the stocks that you like, you've cut almost all of those positions.
Is n't it? That's exactly what you said . I didn't say that, I said that I reduced the volume in trading. I sold Vertiv, I sold something else. But Meta—no, I said she's still one of my biggest positions. Taiwan Semi remains, except that I shortened it about half a year ago, which turned out to be a mistake.
You know, it's not that far from the current values. This is my biggest position. So I'm still in it. I'm simply focused on companies where the valuation underpins their operations and where they've already passed the capex stage with finished products. So, look, I prefer cash flow. So I look at the EBITDA multiple, I look at the EBITDA multiple, well, let's say Nvidia, which is 10 for next year.
You don't have an EBITDA multiplier for Coreweave. You do n't have it for Anthropic. You don't have it for OpenAI. And what you have is Anthropic, who say, "We need 750 billion ." Just for the next few years for funding." So I avoid those companies. I'm not saying they won't grow. I'd just rather skip that high- momentum hype and stick with something that will stand the test of time over many cycles.
If you'll allow me, Jenny, in a second. Do you want to respond to that? Because, I mean, that sounded like a stone in your garden. Vertiv, Quanta Services, GE Vernova. I'll be very specific. I don't think they have high beta, Steve, in the context of AI trading. KLA Corp, Lam Research, Marvell, Corning, Micron.
I don't think they have high beta in the context of AI trading. It's not beta in You said "high beta." Well, I'm saying that's one of the characteristics. The other is that Can I finish? Yes, of course. Okay. So, I want to invest tactically and thoughtfully where there's been a clear lag, like in the case of the three industrial companies that I I mentioned—10-12% last quarter.
You've seen both retail and institutional positions being reduced in these large- cap companies. I don't need CoreWeave. Don't fool me. I agree with you. I don't need CoreWeave. I don't need high- beta assets because I think the market is going to narrow, which will only reinforce my thesis towards the end of the year.
The market is doing exactly what you're saying right now. We believe in the AI thesis. We believe investing in AI is the right thing to do. We're going to focus on quality. Now moving to quality means defensively oriented "magic seven." That's what I said. It's expanding as we move into the end of the year.
It's expanding , you see the growth in positions, it's moving into other large-cap AI areas that have shown results but can't be considered high- beta because they have earnings growth. Those are three industry names that I I mentioned, these are semiconductor equipment manufacturers , memory and optics.
reports tonight, right? Yeah. Beta is just one of the metrics. I'm not throwing anything out of my portfolio just because of beta, that's for sure. Otherwise I wouldn't have Moderna here, which, you know, has more than doubled since I bought it. I would n't own, I wouldn't have Vertiv here from 45 to 240, so that doesn't scare me.
But when I see the end of the cycle in terms of capital spending growth, and I see it a year from now, right? That the appetite for that will wane in these companies that just have to spend and spend and spend, right? And eventually this allocation of capital from sovereign wealth funds, which have been some of the major lenders and investors, will run out.
They have position limits too . Jenny, excuse me. I'm going to be quiet for a second. I want you to focus on Vertiv for a second. You and I know you, Steve. You you'll be back in Vertiv very quickly, as soon as you see... I'm already trading it. ... as soon as you see it go up, and it's going to go up when we get into November.
No, I'm not going to be back in it when it goes up. Joe, I buy them when they go down. So why don't you buy it now? Because I just... I've already made money on it. Pretty low. That's how I made money. Look at the valuation. When I bought this company, its P/E was 15. I don't know what it is now. 40?
But that doesn't matter, because I think the hardest part here is the earnings growth. You mentioned earnings growth, Joe, and we need to see that. And that's where there's so much skepticism. That's why Micron is up 220% year over year, but it's trading at a P/E of less than 10, because there's a lot of doubt that they can sustain that kind of earnings growth.
So even when we're talking about valuations, they can't be relied on right now. You can't just say Micron is worth 6 or 7 times earnings right now. We don't really know. What's interesting about Vertiv is that there's no volatility. But okay. I'm looking... wait. Let me give you the numbers. This is a good company that benefits from the cycle.
Listen, here's the thing. This is not just a cycle. This is a three-year period. Revenue growth over the last three years... let me finish. Vertiv's revenue growth over the last three years is 21.67%. Revenue growth over the last two years is 26%. Over the last year is 30% . Last quarter is 24%. This doesn't look like extreme volatility.
This is actually a cycle. It's very stable. It's a cycle. It's a long cycle. Three years is not a cycle. Do you think Micron is in a cycle? Not in the conditions that we're in now. We're in a strange... Why is this a strange world? Because we've never had technology like AI. So why does it have to be weird?
Why can't it be really good? Because we don't have -- we don't have a historical period where you can look back and say, "Hey, this technology came out so fast." Does that mean it's bad? I'm not saying it's bad. Nobody. But I think by choosing Vertiv, you're confirming Steve's point, because he says you can't just say, "I'm into AI." What Steve's trying to say -- sorry, Steve, I'm explaining for you -- is that you have to be nuanced, right?
Because what's happened this year, and it's really interesting, is that there's been a discernment and a selectivity in how investors are approaching AI. That's why Palantir and Nvidia are only up 14% this year, why Micron is up 200% and Oracle is down 30%. There's been a selectivity. So there's real facts and real skepticism about earnings.
And I think we all sitting here... There's a reason the S&P is trading below its 10-year average multiple right now. It's because there's a lot of skepticism not just about Vertiv's earnings, but about the earnings of all companies. It's not skepticism about earnings. It's not...it's not...it's skepticism.
First of all, it was the political headlines, the idea that data center construction is going to slow down. That's been the biggest challenge, and therefore the lag in metrics. You've seen a lot of momentum players step aside. That doesn't mean we won't need data center power and cooling equipment in the future.
There's nothing in the earnings reports that is fundamentally different and supports what you both are saying. That's the generalization that Mike is making. That's the generalization that you're making. You're generalizing it as if we think all spending is going to stop completely. That's not the case at all.
It's not going to peak. As and any other cycle, it has a peak. Do you think Micron is in a cycle, or is it going to skyrocket? I think Micron is in a more extended cycle than history has shown. So the bottom line is that it's a cycle. A cycle is defined by a peak and then a peak. Yes. I'm saying that when capital spending slows, it never goes away completely.
Vertiv won't go bankrupt. If you stop building data centers. Right. But my point is that once it peaks, valuations peak and come back down. That's been true since the market opened, right? Going back to that... I guess our disagreement is that you think we've already peaked earnings, and... I think we'll peak in a year, and markets historically price that in a year.
Yeah, he's not saying it's a peak. And that's the difference between our approaches, Joe . Your approach is to buy expensive, and then more expensive. Mine is to learn from the mistakes of the last decade. Listen, wait a second. I'm saying I'm selling high, just so you know. Well, no, he's saying "buy high, buy high" now.
I'm giving you No, actually I'm admitting right now that you're getting a correction opportunity in AI trading that I want to take advantage of. It's barely a correction. I think 15% for a company like Vertiv, it's really... Not when they went up 300%, not when Vertiv went up 500%, a 13% drop—is that a correction?
Absolutely. I was just arguing on Twitter today with this guy who wrote, "Oh , you said that when energy, when the AI sector gets squeezed, energy is going to go down." And I said to him, " How naive, young, and impressionable are you to think that was a blow?" You know, a lot of these stocks... I don't understand what that means.
It means that it's not enough. It's not enough. What happened in the last week is not a blow to the AI market. It's not... the discount is not enough. So you're basically doing the same thing I did. I'm assuming that we're at the end of this moderate correction, Steve. You're assuming that this is the tipping point and it's over.
And I'm saying that we have n't seen anything yet. Please? I'm saying that we have n't seen anything yet, and I think we all have that feeling, and it can't be more than a feeling . We all have that feeling that we're somewhere near the peak, that we were somewhere near the peak, right? Who is "all of us"?
Who, who... It seems like we all have that feeling. And then there's all these people who are bearish. Who is " all of us"? I think we're saying that the market isn't moving. If you look at the S&P, it has n't really done anything yet. months. And the main drivers of the S&P are the hyperscalers and the companies that are part of that trend.
The market is waiting. It's waiting for something, but it's fighting against those who believe in a day of reckoning because of spending too fast, earnings and stock prices growing too fast. And the people who think... The bears think that this is a bearish scenario. It's time to buy. That's why we're not moving.
Maybe then there will be some clarity. I'm going to change the subject, move away from what you were talking about. Well, not exactly where you were going, but where you were already, because I'm sorry . I was about to go. Um , Meta, okay? Meta reports tonight. Maybe you'll get some clarity from Meta today, Jenny, on where we are.
I mean, you sound pretty pessimistic about this trade in general. So you probably have low expectations for Meta, huh? No, really, and that's the whole point. The point is, I don't think you can look at AI trading as one thing, you know? I think you have to look at each company individually. And if we think about Meta specifically, I don't think there 's any other company that's using AI better because they, you know, and yeah, they have a huge operating cash flow.
They're using it to build out data centers and all that, but it's still a very profitable company. They're supposed to grow their revenue by 24% this quarter, so I'm expecting that. I'm sure they'll say something positive in the news because why wouldn't they say, well, why would they say something negative?
Um, but I think I think you can support Meta because it's trading at... wait, what's the price? It's trading at 21 right now. They're going to have double-digit revenue growth. And that revenue growth is more reliable to me than the revenue growth in other AI areas. I like the fundamental story around Meta.
What do you think about AMD? Um, I think you can probably support AMD. Okay, okay. You know, but it comes back to the nuances. You can't just say " AI trading," right? That's too general a concept. So if we hear a good report from Meta tonight, you know, what's the trading idea? AMD. Okay. 5.5% of their revenue is from Meta.
They're the ones powering the AI agents with their processors. So you have to assume, right? What's the valuation? Who are their customers if it's only 5%? Who else is there? valuation? Sorry, you need to look at the valuation. You need to figure out who the other 95% is, because maybe Meta is just doing well.
What happens, huh? What if, say, Anthropic and Open AI, what happens when they report, and we see a real slowdown in spending that's already starting to show? And what if that will it have an impact? There's a lot of what ifs. So, you know, it doesn't matter. These are all theories, which is why this is so complicated, and why the valuations are a little lower than they were before, because of the skepticism.
Yeah. Well, we're confirming that the market is both worried and excited. We're saying it's both . What are they saying? Any ideas? Yeah, and it's okay that I have some stock in this. You know, Joe wants to buy some. Okay. Hopefully it works. But don't expect everything to skyrocket overnight . Yeah, I agree.
In the near term. Real money, real debate. Lots of talk. I guess. Wise, Meta. Let's go. So you never know for sure. In the past, it wasn't earnings, it wasn't revenue, it was their capex budget . And I expect them to—I would n't be surprised, I'd say —increase their capex budget . I expect them to the stories about the company are going to be very, very positive.
And Meta is a perfect example of what I consider a correction. The stock is trading above 800. I had a core position. I bought more, doubled the position at 550, and then got out of it. Now that's a real correction. Right? Because the stock has n't done, well, done something, but not as big as the others.
So Meta is a company that I'm going to stay with, continue to hold , continue to trade around the excess share, without touching the core position, and I think, to your point, they're showing that AI can increase their revenue and capital. Why is there so much interest in trading around the position, instead of just holding it, if you believe in the company as much as you say you do, and you've only spoken highly of Zuckerberg as the founder, who's still there?
Why are you trading around it? Like I said, I'm not trading around the core position. Well, I mean the core position, this position, that position. I get it, but you don't care , so what's the other position? The other position is that the market presents opportunities, and when the S&P is actually flat, I admit that I like to make money, and I'm one of those investors who looks at absolute performance, not relative performance, and I don't get excited if the market goes down 10 and I'm only down five.
That's not my game. So if I see an opportunity in a company that I know well, like Meta, and I'm very knowledgeable about it, then I'm willing to trade around it. That's a gift. Right. And that's, you know, you're not going to be 100% right, but that's a gift. And that's where we differ. Kerry and I just hold it.
Right? We just hold it. What do you think about Alphabet, as Mizuho says today that it's giving it a near- term preference? It's one of their, it's their favorite Internet pick for the near term. Truist is up to 420 ahead of the earnings report. Everybody, absolutely everybody owns it, Joe. What , what do you say?
It was a bit of a weak link compared to the rest of the Magnificent Seven. Um, I think that in the long term, for Jenny's tenure, Alphabet is a very strong choice because of the diversification of the model. You can also justify the cost when you look at the performance of Google Cloud. Gemini 3 is a fantastic product .
It's very competitive compared to what we're seeing from Claude at Anthropic. I just think that for most of this year, the stock has been gradually underperforming because it has been relatively outperforming over the previous 9-12 months. I think the catch-up phase is coming in 2027. Let's look at Netflix.
The stock is now at its lowest level since August 2024 and has been virtually unchanged in the last 5 years since the earnings report. The outlook was weak, the lowest growth revenue over the last 3 years. That's why the stock looks like this, but if you go back, it's been like this for most of the last 6, 8, 9 months.
Can we have a year-to-date chart , please? Here, please. That shows the picture, right? Julia Boorstin has more information on what's going on here, Julie? Well, Scott, this is the sixth straight quarter that Netflix shares have fallen after reporting, and they're now down 47% over the past year. Today's drop comes on the back of a weaker- than-expected fourth-quarter revenue forecast, and Netflix also lowered its full-year ad revenue guidance to $2.7 billion from its previous forecast of $ 3 billion.
Co- CEO Ted Sarandos addressed the user acquisition issues on yesterday's call , noting that they're focused on their core businesses: original movies and TV shows, licensed content, and live events. He said the experiments on YouTube are relatively small, and they are optimistic about the impact of new chief content officer Peter Rice.
But Wells Fargo, which has an “underperform ” rating, is concerned, citing, “We believe that if engagement doesn’t improve, users will spend less time, log in less often and eventually unsubscribe.” It goes on to add, “We can’t shake the idea that changing the chief content officer is the first red flag, Scott.” Yes, Julie, thanks for the review.
This is our Julia Borsten. I don’t know. This stock is broken. Yeah, oh yeah, but the valuation is 18 or 19. So everyone who likes a cheap valuation, go buy it. Have fun. So where are you? That’s what’s happening. It’s not cheap. It’s not cheap enough. Not enough. For Netflix? Not for that. For Netflix?
Not for that kind of earnings momentum. That was the main, main growth story in online streaming. It was the only growth story. It was. Okay, because I used to love this company. You can't compare historical valuation without comparing historical growth. And they're not going to grow. They're going in the opposite direction.
100%. That's right. That's why I sold it in the '80s. And I think every one of the streaming services, including Disney, I think you should avoid all of them because I think they have serious content and cost challenges. Uh, as someone who's followed the entertainment industry for many years, I would say they've become a broadcaster.
It's not a broadcaster in the traditional sense, but that's what they do. And they need a lot of viewers. They need subscription growth. They don't really have advertising. Now it's hard work because they already have such a big market share. It's difficult. they have advertising. Yeah, I get it, I get it, but that's not what they're going to make a lot of money from.
Yeah, they don't develop it enough. And they're in a really tough spot because their costs are going up. It's getting harder for them to produce their own product. They're not paying enough people who are saying, "I'm the best, you should pay me for my content." The advertising model is even more content-driven.
Sure. Okay. We'll take a break. Top picks of the day. Okay, let's get to the picks of the day. Joe , you're paying a lot of attention to both of these stocks . Exxon's target price is $181. Although they have a neutral rating on the B of A. Valero's target price is $471 , also neutral on the B of A.
So the upside potential for both of these companies is very limited. What's your any thoughts on this? Well, first of all, I think it's most important for us to focus on Valero. Exxon is more dependent on where spot and Brent crude oil prices are headed. And most importantly, tomorrow we will hear a report from Valero.
They will report profits, but it really comes down to refining margins. This is the reason why I remain loyal to this investment even as it grows. I have repeatedly said: intuition tells me to sell a part, but I don't want to sell because I see indisputable evidence of serious problems with the supply of diesel fuel, and therefore gasoline as well.
So, if you're looking at the score, this is an indicator at the high teenage level. If you look at the balance sheet, they are generating historic cash flow, and you will soon hear from them about a historic quarter. My advice to viewers: if you already own these stocks, stay with them and gradually tighten your stop loss as the price rises.
I do n't think it's unrealistic to expect Valero to reach the $500 mark. Morgan Stanley continues to endorse Marriott, Jenny. $403 is the new target level with an “ Above Market” rating. Yes, I like this new target with the stock trading at $405. Well, that's pretty funny. You know, it's not easy for me , because we've owned them since we launched our disciplined growth strategy in 2013.
We had incredible total returns, but they are now trading at 31 times earnings, and the free cash flow yield, which is a significant headwind for us , has fallen to 2.5%. But you have a company that is growing steadily at double-digit rates, at the mid- tenths percent level. So, again, I always say—Steve always says, “eternal compounder.” It's a perpetual compounder, so we're sticking with it, but it's not worth investing new money in right now, and that target price certainly isn't too impressive.
You also have Northrop, an outperform rating from Baird, a price target of $675. So this is a more compelling option, and I think you have more options here. This stock trades at 18 times earnings and has a nearly 5% free cash flow yield. Minus 5% per year. This is not double-digit earnings growth, but high single-digit growth is expected ahead .
And the most interesting thing here is that they just raised this figure during the earnings report. They have an order book of $110 billion. So this is the case when you can be sure that the profits for the next 5 years will be very reliable. Okay, Oppenheimer is upgrading Zoom today, Joe, to " outperform market." Yes, we've talked about this before, and we're getting closer to the moment.
Target price—130. Yes, I think we're getting to the point where, if you're playing for Zoom promotion, it's worth stepping aside. There are many reasons why people are investing in Zoom, a software company in the year 2026, when software faces incredible challenges. Do you know why these stocks rose 16%?
In the 20th...I'll get to that now. In 2023. Rather. Okay, in 2023, right? They made an investment. They invested in Anthropic in 2023. They invested about $50 million in the company. Now this share is worth several billion. They will profit from this when Anthropic goes public. Okay, Frank Currid has our news today.
Okay, Meta reports after the market closes. We'll be with you all the way through the report with Stephanie Link, who owns the stock, Bryn Talkington, Dan Ives, Mark Mahaney, Courtney Garcia, and I hope you'll join me at 3:00 ET to see if the market can hold in the green for the rest of the day. The Nasdaq is currently leading, up 1.25%.
We'll see how it all ends. Mr. Weiss. FTAI Aviation—Macquarie issued a report today and began coverage of the stock. They see the price doubling in a year. This is quite impressive. I agree that they will grow significantly. Good. I sold Fortress for 50, so he's just using it to make me jealous. Albertsons—5.1% yield, very cheap, a couple of positive things happening that could provide a small boost.
Okay, Kara. NextEra is a great utility company, and if we have a change in the House of Representatives , they will bring back the word " sustainability," which will help NextEra. Joe T. What we didn't have in the third quarter was active trading volumes. You will see them return in the fourth quarter.
This brings us back to brokers. Okay, great stuff. See you all at 3:00. Now to our panel. High Towers, Stephanie Link, Spring Talkington, Dan Ives of Yorkville Advisors, Stephanie Brenner, both CNBC contributors. Greetings to everyone. Dan Ives, I'm going to go to you first. And let's start with Meta.
I think Julia hit the nail on the head, don't you ? This range of capital expenditure. Is this the main question for you? Absolutely, but I think the difference is that demand is growing through Muse, it's really starting to take off. If you think back to the last few quarters, the whole problem was that they were spending money like 19- year-old rock stars.
You haven't seen any real results. Now you see them. And I think, from an investor's perspective, this will be a strong quarter in terms of advertising growth. They could increase capital spending, but I think investors are okay with that now, given our belief in Muse. We could talk about components that will ultimately add a hundred to a hundred and fifty dollars per share to the story as it unfolds.
That's the difference between this quarter and the previous few. It's interesting that you say that. I'm thinking the same thing Steph asked. We had a conversation, you know, when? I don't know, a few blocks ago when they announced the spending and Wall Street hated it. And now some hope they will reach the upper end of the range.
What's the matter? Well, I think Dan has made the main points aptly and very well. As for the neighborhood itself, it will be wonderful. I mean, 20-25% growth in advertising revenue is very impressive, but the important part will be monetization. This will be a key point. I think, Scott, that time spent online is actually accelerating, and that's a change.
I think time spent on Instagram could grow to 19% from 14% last quarter. So this acceleration fascinates me. Advertising impressions are the same. Last quarter , 14%. I think you can even see an acceleration, given all the investment spending they've made. So the numbers...I'm not even sure we'll get capital expenditure data for next year.
They can give us a range. They may not give us anything . But the numbers range from $130 billion to $ 145 billion in capital spending this year. Next year it will be about 206 billion. The highest number I've seen is 249. I don't know if we'll ever see numbers like that, but if we do, they'll have a lot of explaining to do.
But the explanations will be related to Muse, because it really fascinates me. This is a game-changer. They are going to attract 4 billion users. They will see the return on investment, but we want to learn more about that tonight and also in the future. However, 11 million downloads in the first 40 days—that's pretty impressive.
5 million DAU, daily active users, at this point. Very impressive numbers. Now we just want to add more specificity to this question. Another question that concerns me is: will they announce an additional share issue? Because that's one of the reasons I was disappointed with stocks when I actually sold them.
So we don't know if they will announce it. Rumors say about 30 billion. We know they need a little help with cash flow. So I wouldn't be surprised, but we have to see how monetization becomes a reality. Dan, Muse—that's the reason stocks had their best month since 2022, right? They grew by 27%. But competition is looming.
Some is already here, and even more will come from advanced laboratories, and, it seems, from everyone else. So, how do we deal with this? I think the difference is in the installation base. And Steph was talking about 3.5 billion, if you look at what they have access to—that's their golden user base.
This is very similar to what Apple does. And in a way, if you think about Dario's letter and essay, it was the best thing that happened to Meta and Zuckerberg, because it empowers them. They will continue to narrow this gap. They will step on the gas. And now comes a crucial moment for Meta. Monetizing this base, show it after the last few quarters in the "penalty zone".
Do you expect to see capital expenditure figures for 2027? Steph said, "I don't know if we'll get them." Do you think we will get it? I think they might be able to talk about it in general terms. I don't think they will give exact numbers, but they may want to prepare the market to avoid surprises next quarter.
Is it okay if you don't get specifics on the 27th? I think Wall Street is fine with it if you give at least a rough idea of where the capital spending is going. But it all comes down to whether you show monetization, as in the case of Microsoft or hyperscalers; investors want to see this because you want to double your efforts in terms of profitability.
Steph, what do you think about these fines? 25 billion, New Mexico, the Cambridge Analytica affair—this news broke just a few hours ago. The stock never seems to react to the size of the fine in any of the cases Meta has faced. I know. Well, they will file an appeal, it will take a very long time, and then they will go to arbitration.
So I try to ignore that part. This is very important for people and for our entire society, but I'm putting it aside. I want to focus on fundamentals. And if they work on the fundamentals correctly, I'm sure they will be rewarded . Okay, let's talk about Tesla, okay? Let's get to this. Brenna, I'll give you the floor in a second.
Everything, as Phil said, is leading to a merger with SpaceX. Is that all you're interested in tonight ? Well, I think it's fundamentally important in terms of what they're showing, and not just in terms of Optimus, but also in terms of taking the time to do it. You're thinking about cybercabs and eventually robotaxi to show the pace of development we'll see in the coming quarters.
But it all comes down to what Musk said last night, and we've talked about this before: the probability of their merger has gone from 80% to 90 %, but it all depends on the price. I continue to believe that 500-550 is the price that is most likely to work for investors, but they need to show that through Optimus, the Optimus roadmap, and the AI ecosystem.
This is the main reason why SpaceX will eventually want to merge with Tesla. This... So, that was the CNBC Halftime Report for today. Um, as always, before we get into the analysis of the stocks mentioned in the report, we'll analyze the S&P, Nasdaq, Dow, and Russell 2000. So, the major indices. Um, so we'll start by looking at the S&P 500.
Um, you can see that they're up about 54 points today. Um, up 0.7% to about 700. Sorry, 7,766. It was steadily rising, as you can see, throughout the session, and the dips were quickly bought up. Um, the Nasdaq was the leader today, up nearly 327 points, or 1.24%, to nearly 26,750. Um, the Nasdaq pretty much set the tone for today.
Um, the Dow added about 294 points, a 0.56% gain, to about 52,790. That's a solid gain, but it lagged behind the Nasdaq, which tells us that it was an AI bullish day, not a broad rotation. And you can see at the end that the Russell 2000 was an underdog. So , it increased by approximately 0.47%. Small caps participated, but without much confidence.
Um, so the chart is unstable with a spike at the beginning and then trading throughout the day. So, let's take a look at what really drove the market, and you'll see that the heat maps here really show why. And you can see that the technology sector here is almost entirely green. Micron rose 2.5% or so.
Nvidia rose 2.4%. Apple about 1.5% or so. Um, we also have Tesla jumping over 3.5% ahead of the reports and, um... Meta up about 2% ahead of its report after the close today. Alphabet was a big red spot. Um, so that's a 1.72% drop. Healthcare was also weak, as you can see here. Um, with Eli Lilly and Johnson & Johnson at the lows.
Um, so that's why I would add a little caution. So, the headline numbers look strong, but the breadth of the market is very mixed. So, rising stocks outpaced falling stocks 53% to 44%, which is not bad, but um, look at the highs and lows. Only 94 stocks hit new highs versus 23 new lows. Ahem. And only 32% of stocks are above their 50-day average, and 39% are above their 200-day average.
Um, so the index's growth is driven by a narrow group of large technology companies, while a significant portion of the market is still under pressure. This is a divergence worth noting. Um, so all eyes will be on the reaction to the Tesla and Meta reports tomorrow. So if tech holds up, the Nasdaq lead will continue, but if they stall, um, that weak breadth could start to matter.
So, if we are technical analysts, watch to see if the S&P holds today's gains at the close and if the Russell can start to catch up. So, now I'll take a look at some of the stocks featured in today's CNBC Halftime Report. By my count, there are about 10 of them in total. Um, as always, we will analyze them using Ichimoku indicators.
Before we do that, I'll go over these Ichimoku indicators very quickly. Um, just in case you're new. Um, so here we have the Ichimoku cloud. This here represents the future Ichimoku cloud, which is usually about 27, excuse me, 26 sessions ahead. This green line here is the Chickow Span line, also known as the lag line, 26 sessions behind.
The blue line here, which runs through the center of the screen, is the Tenkan Sen line. We have a red line here, which is the Kijun Sen line. These candles here obviously reflect price dynamics. The current price can be seen on the right side of the screen, down here. And the lines at the bottom here represent trading volume.
So, we'll actually start with a review of Zoom Communications. We will do this in the reverse order that they appeared in today's report . So Zoom has actually made a strong recovery, as you can see, in recent sessions. It rose from around $93-94 towards the $101 mark . It is currently trading at $100.31.
However, after this sharp upward movement, we are now seeing a pullback . So, let's explore what the Ichimoku indicators tell us about the next potential move. So , let's start with price dynamics. Here. Zoom broke out of its previous consolidation range and rose above the psychological level of $100.
This is an encouraging development for the bulls. However, recent candles show some selling pressure after the stock approached $101.50. So let me zoom in a little bit. You can see that there was a bit of a sale here. This suggests that buyers now need to demonstrate that they can defend the latest breakout.
Looking at the Tenkan Sen line, which is this blue line, and the Kijun Sen line, which is this red line, you can see that price has recently retraced to these short-term trend indicators after a rally. The Tenkan Sen is currently near the $100.60 mark, while the Kijun Sen is near $98.82. So, at least according to the values on this chart, an important level to watch is whether Zoom can recover and hold above the Tenkan Sen.
And if buyers regain control and prices move decisively higher, it could pave the way for another attempt to reach the recent high near $100.50. On the other hand, if the price remains below Tenkan Sen, then the pullback may continue to Kijun Sen. So, if it drops below the blue line to the red one here, that would be an important area to watch for signs of support.
So , looking specifically at the Ichimoku cloud, here it is . The price is trading above the current cloud here at the top, which is a positive signal for the short-term trend. The future cloud also, here, seems to have a " bullish" nature as the predicted cloud structure grows to higher levels. This suggests that the overall technical picture remains constructive, although the recent pullback means that one should be cautious in assuming that the rally will continue immediately .
When considering the Chikou Span line, or the lagging line, this is an indicator to watch. And you can see that it is clearly positioned above the historical price dynamics. And this provides further confirmation of the bullish momentum. Although this needs to be evaluated relative to the candles further back in the chart.
So , finally, let's define key price levels. On the upside, as noted, $101.50 is the first major resistance area, right up here. And then—a recent intraday high of around $102. So, if Zoom can break through these levels and maintain momentum, it will strengthen the bullish outlook. On the downside, $100 is an important psychological level to monitor, followed by the Tenkan-sen around $100.60 and the Kijun-sen around $98.82.
Thus, a sustained movement below the Kijun-sen will weaken the short-term situation and shift attention to the upper cloud boundary. However, overall, the Ichimoku pattern for Zoom remains cautiously bullish as the price is above the cloud as you can see. And the predicted cloud here is growing. However, the stock needs to regain momentum and break through this resistance to confirm another phase of growth.
I will watch for a sustained move above $101.50 to confirm the bullish trend, while a drop below $98.82 would be a warning sign that the pullback is becoming more significant. So next we'll take a look at Marriott stock. So, as you can see, the stock price is currently at $406.70, and the technical picture shows impressive bullish momentum.
Let's analyze this using Ichimoku indicators and see what they tell us. I have identified key levels to watch over the next few sessions. Starting with the price dynamics: Marriott has been showing an upward trend throughout the entire period shown on the chart. We see a series of uptrends followed by a relatively brief consolidation before buyers come back into play and push the stock to new short-term highs.
The latest move has pushed the price to the $407 level after a strong rise from $390. So we will pay attention to these two levels here. You can see that the price is currently trading near the upper limit of the visible range, indicating that buyers remain in full control. However, after such a strong rally, we should also consider the possibility of a short-term pullback or consolidation.
Next, let's look at the Tenkan-sen line—that's this blue line. And also on the red line of Kijun-sen. Ahem. So, Tenkan-sen is at around $402.75, and Kijun-sen is at around $398.46. The price is trading above both of these lines. Tenkan-sen is located above Kijun-sen. This is a bullish Ichimoku pattern, which confirms that the short-term momentum is upward.
So as long as Marriott remains above these indicators, the bullish structure remains intact. But if the stock faces profit-taking, the Tenkan-sen line at around $402.75 would be the first area I would watch as potential support. Below this level, the Kijun-sen line near $398.46 is also becoming an important level.
A sustained break below the Kijunsen would indicate a weakening of the uptrend and could lead to a deeper correction. So, a breakout below the Kijun-sen line to this level. Cloud testing can begin . Of course, if the stock breaks through the cloud and starts trading below it, it will be confirmation of a " bearish" stock reversal according to the Ichimoku model.
So , moving on to the Ichimoku cloud itself, the picture here also remains strongly bullish. Marriott is trading confidently here, above the cloud below. Since the outlook cloud is also green, it continues its upward movement. This indicates that the underlying trend remains positive and the level of projected support is increasing.
The gap between the current price and the cloud shows how far the stock has broken away from this underlying trend structure. This is encouraging for bulls, although it does mean the stock could be vulnerable to a pullback to its short-term indicators before the next move up. So, we should also pay attention to the trading volume, which is displayed at the bottom of the screen.
The graph shows several notable spikes in volume during, sorry, the initial growth. This supports the idea that buying interest helped push the stock higher. However, the recent breakthrough should ideally continue. Er, sorry, it should ideally attract further buying activity if the rally continues.
Finally, we will look at some of these key levels. Uh -huh. So, on the upside, the immediate area to watch is the recent highs around $407, right up here. And behind them is the psychological level of $110. Sorry, $410. A break above recent highs could signal another leg of growth, but confirmation by price and volume will be important.
On the downside, the first level to monitor is $402.75, followed by $398.46 on the Kizun-sen line, so somewhere around here. Uh, if the price breaks below this second level, traders should expect further weakness towards the rising cloud mentioned earlier, which is now well below. So, overall, Marriott International is showing a strong bullish pattern according to the Ichimoku indicator.
Uh, the price is above the cloud, as you can see. Uh, the price is also above the Tenkan-sen and Kizun- sen lines. At the same time, the future cloud remains positive, and the Chikou Span line is also trading above historical price indicators, confirming the "bullish " nature of the stock. So, the big question now is whether buyers can sustain the momentum and push the stock well above its recent highs, or whether the stock needs a period of consolidation.
So I will be watching the area around $407 for a potential breakout and the $402 level as the first sign of support. Okay, next we'll look at Valero Energy Corporation. Er, so. This stock, as you can see, the price is below the Ichimoku cloud, and this is already confirmation that we are dealing with a "bearish" stock.
Uh, you can also see that the future Ichimoku cloud is red, uh, and it's moving in a downward trajectory. Uh, we also have a look at the Tenkan-sen and Kizun-sen lines. Again , the Tenkansen line is this blue line, and the Kizunsen red line is here. Regarding price movement, uh, it's here. So, the price dynamics are below both of these indicators, it is below the cloud, Tenkan- sen and Kijun-sen.
Um, so there is very little support. Hmm, this is clearly a bearish setup. It also appears that the Tenkan- sen is currently trading above the Kijun-sen. So, this is another important indicator in the Ichimoku setup that you see for bearish action. I also notice that the Chikouspan here is trading below historical price action, as well as below the Tenkansen, Kijunsen, and Ichimoku clouds.
So again , this is confirmation of bearish action within the Ichimoku setup. In fact, all of these Ichimoku indicators are converging, confirming the bearish nature of the stock. And finally, we have the future Ichimoku cloud, as mentioned, which is moving down on a downward trajectory, and it is also red.
So again , confirmation of bearish action. Next up—Exxon Mobil. So it gives very conflicting signals because the market is very oversold. You can see very quickly that the price action is above the Ichimoku cloud, which is usually confirmation of bullish action. We also have the Ichimoku future cloud here, it's green, but it's not trading, it's moving sideways.
So it's not necessarily bad, but we wouldn't say it's good. The price action was slightly above the Ichimoku cloud. It is actually difficult to see where Tenkan- sen and Kijun-sen are in this setup. It seems to me that the Kijun- sen may well be trading above the Tenkan-sen, which is one of the signs of a bearish stock.
That's why I would say this is a cautiously bullish signal. Another reason we say this is that the Chickasaw Span line here is trading below historical price action. Again, we usually associate this with bearish action. So, overall, the fact that the price is above the Ichimoku cloud allows me to say that this is a cautiously bullish signal for the reasons I just highlighted.
Next up, we have Netflix stock, which actually reported earnings last night. Um, well, actually it was yesterday after the close of trading. And you can immediately see that the price action is decidedly below the Ichimoku cloud, confirming the bearish nature of the stock. We also have the Ichimoku future cloud here, which is, um, also, um, over the price action.
It is moving in a downward pattern and is also red, confirming the bearish nature of the stock. And it creates a zone of excess resistance here. So, this is what a stock has to overcome to become "bullish." Next we have the Tenkan-sen line here and the Kizun-sen line here. The price is below the Ichimoku cloud, Kizun-sen and Tenkan- sen.
These are all signs of a " bearish" action. In fact, as you can see, there is no obvious support zone for this stock . Although there was some consolidation here at the bottom, the price is starting to move sideways. So, it's entirely possible that she's already hit rock bottom. We also have the Chico Span line, which is 26 sessions behind.
And it is below past price levels. It is also below that historic Ichimoku cloud. So this action within the Ichimoku system looks quite “ bearish”. If you've been following Netflix over the past few months, this probably comes as no surprise. Next—Meta. We have analyzed it quite often recently. The report will be after the close of trading.
So let's do this very quickly. You see that the price is currently below the Ichimoku cloud. In fact, she is on the verge of going through it. We'll see how this develops. Technically, this is a "bear " action, but I will call it " bear" cautiously because it is on the verge of transitioning to a " bullish" trend.
You can see that the Tenkan-sen line here is trading above the Kizun-sen line. This is what we usually associate with a "bullish " action in the Ichimoku system. We also have the Chikou Span line trading above historical price action, confirming a bullish setup in the Ichimoku system. Next is Core Weave, which we already analyzed this week.
Again, I would cautiously call it "bearish" because the stock is below the Ichimoku cloud, which is usually associated with a "bearish" trend. However, you can see that the Tenkan-sen line here is currently trading above the Kizun-sen line, which usually indicates a “bullish” sentiment when it occurs above the cloud.
It happened under a cloud. That's why I say she should be cautiously "bearish." We also have the future Ichimoku cloud, which is red. It is no longer moving downwards. It is actually moving sideways. Finally, the Chikou Span line of the Ichimoku indicator is trading above historical price indicators.
So, given the rather conflicting signals for Core Weave, I will emphasize again that this is a stock with a pronounced bearish trend. It has been in the news a lot lately due to debt problems and other difficulties. So this, again, should not come as a surprise. Next up is Vertiv. This is a stock that we analyzed very recently.
Let me zoom in on the graph. Since the price is inside the Ichimoku cloud, it is classified as neutral. It is neither higher nor lower than a cloud. So, this is a purely neutral action. Looking at the chart, I would probably describe it as neutral to bullish. We say this because the price dynamics occur within the chart itself.
The Tenkan -sen line crossed the Kizun-sen line from bottom to top, which usually indicates a bullish trend, especially if it occurs above the Ichimoku cloud. The Ichimoku future cloud has turned green, and you can see that although there was a decline earlier, it has now bottomed out and is rising slightly.
Next, we have the Chikou Span line, which is trading above the historical price level. So, these are all the signs of a bullish stock, except the price is inside the Ichimoku cloud, not above it. And last but not least, this is my contact. We've been analyzing this a lot again lately. Here, Ichimoku signals are much clearer.
You can see that the current price is above the Ichimoku cloud, confirming the bullish nature of the stock. The Ichimoku Future Cloud is green here, and you can see that Senkou Span A has started to move up. So, right now it's trading, well, it looks like it's about to start an upward move, confirming the bullish nature of the stock.
The Tenkan- sen line is above the Kizun -sen line, and the Chikou Span line is trading above that historical price level. So, overall I would describe this as a bullish stock on this short-term chart. Anyway, that's all for today. Stay tuned for a new video tomorrow. Thank you very much. Foxy.
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