Transcripts For CNBC Fast Money Halftime Report 20160912

The tape in the hour ahead. Joe is today a day to sell stocks . On this rebound of sorts . If you are an investor, then i think over the first couple of weeks of september, you want to take cash levels in terms of equities holdings, somewhere 20 , 30 . Im fine with that. I think the market is in a vacuum right here for an investors portfolio, yes, i would be modestly raising cash. If you are a trader, and i think what land on friday and whats happening today is a trading event. Then youll be using options and hedging etfs on volatility and things of that nature. The play of the market over the next couple of weeks. I think thats more a trading circumstance, and i think whats going on in the market right now is a trading event. Lets just put this out right on the table right now. I any yellin has the votes. I tried to dissect them. Its up behind ow the wall. Foels, what we are looking at is my best guess of who is where, if there is a rate hike on the table. I would is stan fisher and eric likely saying yes. Ive got janet yellin based on her one comment at jackson hole about how something could happen next couple of months. Bill dudley could join her and James Bullard could go either way. He is possible. I have i dont know where jay is. Your headline is liesman, cole, and i think they might do it. I wish i could be more definitive. Can i ask you a question . Sure. You thought it was a trading event. Are you saying it was not a fundamental event . You say it was just traders weak positioning or was it a reaction to the fed . I think it was i think its clearly traders repositioning market right now in terms of volatility. The feeling on friday was that the fed could hike a quarter point and the world as we know it would end. Thats the way the markets seemed to act. The market is not acting assist if it anything. Its machines trading with machines, and then at the fringes you see some people reacting to what the machines are doing. You are not forced at gunpoint. You are not at gunpoint forced to react to one days tooit, and i will remind everyone here at the table, probably you know this as well, we have had 30 instances of negative 2. 5 days in the s p going back to 2010. Every single one of them so far has been a buying opportunity. The market has doubled since that time. If you are going to take one down 97 day, so 97 of all volume friday took place in stocks that were down on the day, youre going to take that and say everything has changed . Historically you would be very wrong. That days of points Means Nothing to getting asset the incremental move Means Nothing. The Bigger Picture view means everything. It means they are now on the path towards tightening policy in a more meaningful way than theyve been in eight years. Well, we know theyve been on the path anyway. Theyre just continuing down a path. I think the path is going to be shorter than what theyve led us to believe. What i go back to i know you spoke to this. This isnt reason alone to tighten, but the average peak in rates to drop in rates during recession is 550 basis points over the last be lucky to get half of that. It will cost them we dont have it. Brainerd speaks in less than one hour. 1 15. Okay. In a little more than an hour. Is she a Voting Member . She is. Shes a governor. Shes a permanent Voting Member. Shes also one of the most dovish people. His point this morning of whats the rush doesnt mean as much . He radio he flekts a view on the board that doesnt i only have the voters there. I dont have the nonvoters. Heres the other thing. If it yellin decides she wants to hike, she probably has nine or ten votes nine votes to go with her because i think the governor is more or less the governors will fall in line. Its been since 2005 that a governor descented rather than a president. In general, theyve descented when they have on the side of being easier. What are the chances of looking at your spreadsheet there. You think people would change their mind before the official i dont think the chair will be on the wrong side of the vote. I think she will create a vote that puts her on the right side. Let in other words, give do you buy stocks or do you sell stocks . So look. Ahead of next week. Snoo heres the only concern i have about the market is that complace ece si. We saw that coming out on friday. You had rosengreen that was also very dovish tilt hawkish. You will either have brainerd come out and also tilt hawkish, and that will be definitely go in 22nd. I think theyre going 2 itnd. You have to keep some powder drive. 20 whatever it is. There is buying going on out there. People are waiting for the dips to throw money at this. Whether its Portfolio Managers behind their benchmarks with too much cash. The fact that it reversed like that indicates that stocks are going higher at 25 basis points. I think its the machines. Its even better than that. Look whats recovering today. Youve got sphb, which is the s p high beta etf outperforming the low version. You have a bullish engulf willing candle at ibb, which is pure Risk Appetite going into biotechs here. The banks held in friday better than all of those dividend plays and mobile plays. You have a lot of things beneath the surface that maybe dont make the headlines. It tells you this is the market adjusting. It is not the markets freaking out with their hair on fire. What happened last time when the Federal Reserve hiked . What happened to the market . The market over the next 30 days went down 20 , and then proceeded to rally throughout the remainder of the year. Did you want to follow along with that trade in the 30 days . The question that you wanted to be in the position the benefit of that trade, in that if you were all in before the meeting what is important to understand is the you come out of the earnings recession in the next three to six months, the market is going to skyrocket. Craig johnson 2350 is the tech market. You dont think that the fed is going to raise next week and its going to cause some kind of panic in the market of greater proportions than were used to . Absolutely were holding the line at 2350, and i would add to this conversation of where are the Portfolio Managers at this point in time . A lot of the Fund Managers are slightly behind their benchmarks for the year, so any of these little shortterm call them selloff ins in the market, theyll view that as an opportunity to be buying stocks. What you are seeing today is some of the higher beta stocks getting purchased right now, and theyre trying to play a little bit of catchup. I suspect theyre going to try to play catchup into year end, and youre going to see this market move higher. I think 2,350 is in the cards. What happens in theyre afraid the market will go down even more, and they dont step in when you think they should . Well, today is evidence that they are stepping in. We have a 7 down day in terms of the advanced decline on from friday. You got good support on the s p, and below that you are rising 200 day moving average, and the longer term secular trend of this market is intact. I would also just add, i agree you got to look at the longterm trend of this market. We were at a 13year secular bear market. We broke out. What we saw in february was a pullback retest, and were starting another leg higher. Craig, its josh brown. In addition to price, what would you say would be the second most important indicator . Are you looking at it for example, percentage of Stocks Holding up trends above the 200 day . What should investors watching the show and trying to follow along some of the things youre talking about at home, what should they throw up on their screens . Absolutely. I mean, watching the breadth of this market, and its amazing. Coming off the february lows, we had 6 of all the stocks in the market above their 40beaweek moving average. Were in the 80 range now. Typically you get up into the 90s and right now that breadth is still expanding. Excludeing what you have seen on friday. Directionally its still improving. I would be watching that, and i would also be watching the overall trend of this market and trying to relax. Follow that primary trend in the market. Higher highs and higher lows what we want to focus on. Is this poorly a technical call . Evaluation doesnt really warrant you getting up there. Valuation on 2016 or on 2017 . The numbers for 2017 look pretty good. Kind of seems to me like its exiting out of this. If you can holding multiple flat, you can justify that 2,350 number or perhaps even more. You think stocks are cheap or expensive here . As you roll out into next year, again, theres going to be opportunities to see that stocks move higher, and not see a lot of multiple expansion. I think you continue to stay kind of around this 60, 60. 50 numbers. If i get the fed going now, and i do believe i think theres very little chance they dont go in september, and i get them going again in december, ive got a stronger dollar, which means that ive got weaker s p earnings than where theyre forecast right now. Thats 40ers approximate of the s p thats under pressure. I dont see how i get the earnings forecast that perhaps youre looking for, which means that theyre overvalued based upon where were seeing the s p. Well, i guess the question comes down to you look at the kind of job owning from the fed. Dovish. Hawkish. Back and forth. What i think youre ultimately trying to see happen is how much of this is already baked into the market . Is this 25 basis points baked in . The last thing the fed wants to do is surprise this market and push it meaningfully lower. As long as we stay in a trading range for the dollar between about 92 and 100 on the trade to the dollar index, i think equity will be fine. You wont get a big head wind to the earnings estimates, and i think youll be fine as you move forward into 2017. I appreciate the time very much. Well talk to you soon. Craig johnson with piper jaffray. Biggest price target on the street. One of the issues i guess the fed has to deal with is if they do hike, they must not believe perhaps that if they hike, its going to cause a big hit to the market, which will in turn cause a potential hit to the economy. What i think theyve tried to do is to create the option to hike by getting out there with the series of comments, yellins comment followed by fishers comments and comments from dudley, comments from guys like lockhart who said that the fed would try to compare the market for this. I want to push back against steve here. Steve, the way i look the athings is the fed is in play when it makes a mistake. I think the odds of that are what are low here. I think you can get a quarter in september. Maybe a quarter in december. I dont think you get much more than that unless the economy is showing that it can with stand that. I dont think you get this kind of move to the turn theyve been over the top. Ive said before, you can trade the fed up on raising rates or lowering rates, but the real way the market trades the fed is on the chance of ae mistake. Isnt it better some will say after the ism reports, both of them were ugly, and the jobs report was below expectations. Isnt it better to wait and see what the jobs report is next time and see what the isms are next time . Whats the rush . You could wait, and the reason why ive changed my view talking about the possibility of the rate hike is because i appear to have overestimated how much the fed is thinking about the isms. They clearly seem after the is came out and guys like rosen is looking through them and not i dialled that back. The big difference with the comments was that he was specific in not being dataspecific. He said im worried about the economy overheating. That was as you pointed out after the ism survey. He was in my mind the first guy who said to heck with data dependency. Im worried about it overheating the dollar. These kinds of conversations are why this really big Money Managers that i have talked to say this market is impossible. Its an impossible market. Possibly from an alltime high. Whats impossible . Its possible because theres an absence of volatility that active managers need. You are finally getting a little bit of that back which is a good thing. You dont know if the fed is going to go or if theyre not going to go. Let me finish this one point. The first cut the first raise that hurts, all the other raises of history shows us dont really matter. The market goes up through them over the next year. The first half slowdown. Rise in overseas risk. They have seemed to have passed. Looks like the Third Quarter is doing better. Theres a bit of a rebound in the beta. The rapid rebound for the current quarter. I would just caution do not make the uncertainty surrounding the fed a proxy for your uncertainty surrounding earnings and the economy because those things are uncertain, scott. We dont know where the economy is going. Nobody at this table is definitively told me they think the earnings recession is over. If you tell me thats okver, i will tell you the fed doesnt matter worth a hill of beans relative to a double digit possibility of accelerating. When we used to analyze the size of the guys briefcase, we never had a headsup. Not ju the fed, but uncertainty surrounding the economy and earnings and whats happening overseas. All of those are the major uncertainties. The fed to me is a quarter point were going to wrap it up where, good stuff. Steve liesman. Halftime report just getting started. Back after this. One analyst. Two big calls. Why one of the top retail watches on wall street thinks its a no brainer in the battle between walmart and target. One is a winner. One is a loser. Jeff gudlochs double line is one of the most successful bond firms. A Top Executive there says the market is flashing warning signs. See what he is telling his clients to do next. Friday is rebalancing day for the s p. According it our partners at kencho, u. S. Markets historically trade lower one week after the 500 rebalances. With the dow and s p fairing the worst. For more on this, go to cnbc. Com pro. More halftime with scott wapner coming up. Theres a lot of places you never want to see 7. 95. [ beep ] but youll be glad to see it here. Fidelity where smarter investors will always be. If only the signs were as obvious when you trade. Fidelitys active trader pro can help you find smarter entry and exit points and can help protect your potential profits. Fidelity where smarter investors will always be. Zblienk the tenyear note yield hitting its highest level since the brexit. Have they bottomed with talks that they could raise rates. With more on where the bond trade stands today, lets welcome in robert coern, with Jeffrey Gundlachs firm. He is exclusively with us today. Its his first tv interview as well. Its new is to see you. Thanks for coming over here. Where are we in the markets . Jeffrey made this comment last week that bond yields have probably hit bottom. That its the start of something, and its time to be defensive. Elaborate on that, if you would. Thats right. I hear a lot of bullishness on tv here today. We see a lot of emerging risks that we think that you are supposed to Pay Attention to, and think of it more strategically than tactically. There is one metric that we look a lot at. I think theres a chart available. Enterprise value to cash flows. The stock market is comfortable or used to looking at p. E. Ratios the way to value companies. The debt market likes enterprise value ebida. I this i it reflects a growing concern that evaluations are getting stretched. You are making the case by the chart that the market is expensive, that valuations are too stretched. Exactly. S p valuations. Exactly. By extension that bleeds into the debt markets because high yield, for example, its a loan to value analysis. If you have a high enterprise value, then you can put more debt on the company. If thats stretched, that puts the high yield market at risk as well. Sflo what does lets say a bond yields have hit bottom. We said its at 16 have 68. The start of something. What does that mean . The start of what . The start of a gradual process of rates rising. Probably gradually for a while. Then rapidly. Were already seeing the bond market question maybe that with the political season now both candidates talking about fiscal spending, maybe that drives inflation. Cpi number inching up a little bit. You see the short rates are clearly off a bottom. If you look at the chart over a long period of time, they clearly look like theyre ridesing. Are you making the case that the fed could lose control of the curve . Absolutely. The bond market is doing then you are saying they shouldnt hike. What should the fed do . The fed shouldnt hike. Shouldnt hike, but they could lose control if wage growth gets faster than expected. Whats the right answer. Not that you guys are policymakers, but sounds like theres nothing they can do. Theyre losing control. That doesnt suggest you raise rates in that environment, but, you know, when were talking about rising Interest Rates, were talking about over an extended period of time. Were not talking about next week. These are issues that are developing over time, and it might take several years to really play out. Its possible that we have really no movement for a while. So, robert, yeartodate, investors have been able against consensus to find opportunities in the high yield markets, to find opportunity in the emerging debt market. Do you think that the situation that will present itself here that you are describing suggests, okay, its now time to look elsewhere outside of those select Asset Classes and to hold back significantly. I think youre supposed to derisk. If you have an allocation to risky assets like we do at double line, you that i that risk down. You dont get out. You cant just stay uninvested. You take your risk exposure down. Even just a slowdown. In high yield, for example, theres sector that is we like, Like Health Care and technology. I think those are places to be if things start to weaken. Robert, how much would it matter if the fed goes whether its september or december, 25 basis points, and much like this past year is on hold for lets call it nine months. Maybe six months. Is it really the psychology that perhaps were entering a more hawkish fed that you are worried about . I think that, you know, with the what happens if they do . He saw in december a small move. It may be 25 basis points, but it caused a visceral market reaction. If you have a fed that wants to do this, arent they looking at the s p 500 at 2,140 and saying weve got the green light . If it goes down, you know, 5 , 7 , were really not that bad off. Were back to the trading range of the last two years. Yeah. I mean, i dont know that were making i dont know if were making a call over the next, say, few months. Lets say investors are in the market as fundamental investors and are coming up of high yield the last couple of weeks despite the spread to the tenyear, which is pretty thin, historically very sthin, okay, and that means youre not getting paid for the risk. What percentage investors in your world in the debt world are searching for yield versus fundamentals . Well, thats the key question. The real pitch for why it should be credit markets is the flow. Its that negative Interest Rates are driving a search for yield and where can you find yield . You find it in u. S. Securities. I liken it to saying you should invest in housing because thats where all the money is flowing. Its not fundamental. Fundamentally the we mentioned the ebida or the enterprise value cash flow number. Credit metrics like covenants and the things that protect borrowers are and investors are weakening. He know you are all grieving the loss of benny baja. I want to wish you well. Thanks for coming on, robert. Robert cohen is with double line capital. We do have breaking news out of d. C. Ayman has that for us. Hillary clinton spoke and brian fallon just wrapped up an interview with nbcs andrea mitchell. He said a couple of important things about Hillary Clintons Health Incident yesterday. He said that Hillary Clinton is going to be putting out further details about her health background. More information she has released to date. He she also said there is absolutely no undisclosed condition that Hillary Clinton is suffering from other than the pneumonia that the Clinton Campaign disclosed yesterday in the wake of her wobbly moments there at the september 11th memorial in new york city. Finally, he said that he is not able to provide exactly the details of what kind of pneumonia Hillary Clinton is suffering from. We know Hillary Clinton is recoup rating and resting at home today, and shes canceled several eths in california as well brsh. Thanks so much. Shares of pandora are jumping today fog a big upgrade and a new version of its service. Walmart versus target. The name one Analyst Thinks has room to run. The one that he thinks will fall flat. Its our call of the day, and it is next. What powers the Digital World . Communication. Like centurylinks Broadband Network that gives 35,000 fans a cutting edge game experience. Or the network that keeps a leading hotel chains guests connected at work, and at play. Or the it platform that powers millions of ecards every day for one of the largest greeting card companies. Businesses count on communication, and communication counts on centurylink. Jake reese, day to feel alive jake reese, day to feel alive jake reese, day to feel alive its a very specific moment, the launch window. We have to be very precise. If were not ready when the planets are perfectly aligned, thats it. We need really tight temperature controls. Engineering, aerodynamics a split second too long could mean scrapping it all and starting over. Propulsion, Structural Analysis Maple Bourbon caramel. Thats what were working on right now. From design through production, Siemens Technology helps manufacturers meet critical deadlines. I think thisll be our biggest flavor yet. When you only have one shot, you need a whole lot of ingenuity. Welcome back. Cowan and Company Making a call on retail today and a big one. Walmart upgraded to outperform. Target, meantime, has been downgraded to market perform. Oliver chen making those calls. What do we think of the deal here . They say that walmart is a comeback story. The trend is your friend. It is coming back. It is coming back, and the trend is your friend. I agree with that part. I think the target has been getting a lot of bad press recently, and you know what, for years its been up and down. Its in a bit of a down cycle. This is probably the time you want to buy it as it mz kooz out of favor. The walmart to me is an obvious call. What about valuation here . The Stock Performance is no contest. Walmart on every metric that i could read you whether its a month, sixmonths yeartodate, one year has blistered targets for the most part. Walmart is up 15 . This call is consistent with the performance here to date. I do see the turnaround story. You are stepping back for a second when we talk about whats going on in retail right now. You think of the hyper markets. You think in 2008 and 2009 how the hyper markets really were the only investment in the retail space. If were entering an environment economically where it sounds as though retail is in the same place, then, yes, were going to like walmart, target, were going to like costco. Ranking the three, ill put walmart first and target second. Im not necessarily sure. Why would you put amazon first or second . Well, i think thats part of the problem. It a defensively or yebted market, and i think that rich valuation for amazon, i think it gets generally exposed. I want to be more defensive in retail, and i think it takes you back. Unless you think that walmart is a defensive play. It is. Its a staple at the end of the day. The last time it closed on a earlier 2015. It went from the 80s to the 50s. Target looks much worse, obviously. A little bit of a basket case. Walmart i think it had a huge run off the summer lows. To me theyre not cheap stocks. I dont think you buy defensive stocks like premium multiples to the market. It will probably go march. Its got that momentum to it. You got to have an opinion on whether amazon continues to steal share from the brick and mortar retailers. If you feel like that trend possibly has run its course, possibly people want to shop in stores again, then any and all of these stocks are buys right here. Thats a pretty bold call. Thats why they bought jet a few weeks ago, and even that is being panned as really not enough on the online side. They have a good online presence, but it doesnt move the needle compared to the stores. How much can it grow . I mean, its so u you have a relatively new ceo in there, and he has people excited and revved up, but, look, its not going to grow to the sky. I would rather buy these stocks like a macys, which i didnt buy, which it has a 5 yield. Stock was 59ish a couple of woeks ago. I think thats on sale. Lets talk about apple because it was a rough week. Market not so thrilled with the next generation of products today. A big turnaround. Apple on pace for one of its best days in weeks. If you have been watching the stocks, is it time to make a move . There it is up 1. 5 . First, though, Brian Sullivan has whats coming up on power. Thanks very much. Coming up at the top of the hour on power, a lot of fed speak today. Is a september rate hike looking more likely . Well have more breaking news from the fed. The headlines will cross during the hour. They could be market moving. Well have them for you. Hillarys health scare. Just how serious is it . How might it shape the race from here . And an exploding problem. Will samsungs big phone issue be a big gift to apple . A stock you just referenced. Maybe thats why its higher today. Were going to dig in more on that side of power lifrm. However, laugh time report back right after this short break. But once its sold, there usually isnt a way to keep improving that product. Today, whirlpool can analyze iot sensor data from connected appliances on the ibm cloud. So they can continuously learn how customers are using their products. And how the machines respond. Harnessing data to make great products better thats what the ibm cloud is built for. Sfliefrm. Im shue herrera. The ceasefire has just gone into effect. Earlier defiant syrian president Bashar Al Assad vowed in a statement to take back all of syria. He visited a damascus suburb long held by the opposition but which was recaptured last month. Two gunmen exchanged fire with Security Forces at a hospital in southern afghanistan before both were killed. Officials say the apparent target was the Deputy Governor who intended to visit the hospital. A security official was also killed. Former british Prime Minister David Cameron announcing that he will step down as a member of parliament. He earlier resigned as Prime Minister after failing to convince voters to stay in the european union. He said at the time that he would remain in parliament. And u. S. Rider cup captain davis love has chosen ricky fouler, j. B. Holmes, and matt for three of his picks. He will make a final pick on september 25th. Five days before the ryder cup begins. Thats the news update this hour. Ill see you again in one hour. Halftime report is back after this. The Halftime Report with scott wapner is the place for marketmoving interviews. You dont call a company a sewer because the company made a mistake. Real money. We are short both tesla and solar city. Real debates. People think that globalization hurts business. It is not. It is technology thats hurt businesses. The s p around 2,165. The market is fairly but fully valued. The most profitable value of the trading day. All i do is get to tweet about the show. Im on the show. This is like the greatest moment of my life. Our debt problem 19 trillion and growing money for programs like education will shrink. In just 8 years, interest on the debt will be our Third Largest federal program. Bad news for small businesses. The good news . Theres still time for a solution. Ask the candidates for a plan to secure our future. Okay, so you launched your banks app. Now what . How will you keep up with the new demands of todays Digital Economy . The fact is some believe they wont need a Traditional Bank down the road, so at cognizant, were helping banking and Financial Services Companies Think digital, be untraditional, and reimagine what the bank of the future can be. Our clients can now leverage customer intelligence to predict their financial needs and provide more contextualized products and services. Were creating new platforms across channels so customers can effortlessly invest, borrow, lend, transactwhereverwhenever they choose. And were digitizing the way banks run, driving efficiencies and delivering new value for their customers in return. Digital works for banking and Financial Services. Lets talk about how digital works for your business. We have a story developing new at noon. Jp morgue al arian ceo jamie diment speaking this hour at the Economic Club of washington. Will fred frost monitoring the event and has a headline for us. Will fred. Yeah, thats right, scott. He just said that rates should be risen right now 25 basis points. Just a small move. This is after being asked whether u. S. Economy was asked if the u. S. Economy is doing okay. When should we raise rates. Heres his response. My own personal view, and she did not call me for advice, by the way, but 25 basis points is a drop in the bucket. You know, we own we say to you 25 basis points go really slow. Dont worry about it. Lets just raise rates. As for when they should be rizern between september and december. He went on to say go sooner rather than later. Scott. Will fred frost, monitoring that for us. Thanks so much. Sooner rather than later. Next week . Be a dovish hike, correct . Yeah. Just get it on. If how do they deal with that . I actually think that the market will embrace that. You dont know. I was at a Conference Last Week and one very, very well known Hedge Fund Manager estimated that 70 of trading is done machine to machine. Algarhythms. You just dont know how theyre set up in correlation by the crude, in correlation to rates, in correlation to currenciecurr. You dont know. You have to let that get out of the way. We dont know if todays action is reverting to the mean. In other words, that it got oversold so now were bouncing back. You have to take the longer term view so that it resets fundamentally. Wave heard from some that are waiting, almost hoping for pullback to a point where the market looks more opportunistic. Well, i also think you have to Pay Attention to consensus. If you think about 2016s consensus at the beginning of the year, the market was not expecting to see positive performance from high yield or the reversal that we saw in oil or even rates to be where it is, and the currency. You need to identify trends. U. S. Dollar. Where does the u. S. Dollar go from here . Why its gone yeartodate is not if the dollar goes up lets just say the dollar does go up on a rate hike. Do you want to buy things like industrials . Sf do you want to buy those in that environment . Im concerned if the dollar goes higher. I am concerned if the dollar goes higher because it pushes back exiting the earnings recession. I think thats a problem. . Youre sieming, though, that the dollar really rallies hard, and i this i what a lot of us, including you that was a problem before. Not that it went up. Its the speed in which it went up. It became the high yielding currency. We are talking about a 25 basis point hike. I think most of us think that, you know, the fed got it wrong at the beginning of this year and said it was going to hike four times. That looks laughable now. Probably same in the coming year they raise once, and thats it for a while. Now, in that context everybody is looking at january, february of this year and saying, along, it could happen again. Down 10 . The fact that everybody is looking for that pattern almost certainly means its not going to happen. There would be some selloff if the fed raises entomorrow excuse me, next week. Of course, there will. The idea that its going to lead to this correction, i dont think its the correct by the key point its not the dollar in a vacuum. Its the dollar euro. Its the dollar yen. I think anyone thats basing the rest of their year predicated on getting that paris trade right is probably set up for some disappointment because we have not seen any linearity after the taper or the first rate hike. If we get another a followthrough of whatever fridays tantrum was, what would be the first thing that you would buy, jim . Where would you look . You mentioned cyclicals. A lot of them are really dirt cheap. Whether you are looking at the airlines or the auto manufacturers. Even going into some of the old line technologies. The intels and ciscos of the world. I think just to sythecize what we are all saying and what you are incident hadding at, if its 25 basis points, what will matter is not this hike, but earnings. Weve been talking about this earnings recession possibly being over. We need to see some proof of that in the upcoming Third Quarter earnings season. I go to the credit card names because if the fed is hiking, i think it gives you some sense that they believe that you are going to see wage increases. You are going to potentially see an uptick in inflation. That does very well for companies that master card and visa who are basically making money off of the size of the trend. The dollar size of the transactions on those fees. Take a look at the chart of master card. This is set up for an imminent breakout. This is a stock thats being accumulated by ted and todd at brookshire hataway. You have one of the strongest financials and a company that is not necessarily a rate bet. Its more a bet that Consumer Spending around the world is ticking higher. I think that that might be an interesting place to go. Youll notice didnt really get beat up too badly on a day like friday. How about you . Im stockspecific. Im not looking to play a theme. I think the airlines got cheap. I think theres a way for them to get cheap again. I Like Health Care quite a bit. I would wait for biotech. 2 today. Yeah, yeah. If you bought it on friday, you did very well. I think some retail names look very attractive. Its where the most cards will be done now. It will be very, very specific. You take a look. Lets say theres a lot of carnage in utility, telecoms. Stay away center those you cant do enough carnage on one or two days to make those attractive again. Snoo give me your answer too. L 68 , lets call it, in equities, 20 catch, the rest in silver, volatility, japanese yen, etf. I look for a significant pullback to give the equity rating but i want to be a winning type of equity names. I dont want to have at this late moment in the year ownership of equities that have to prove to me that theyre going to reverse negative performance year to date. I want to buy names that have already done well and are s p oriented. How about gold . What about gold today . Not silver. If theyre raising rates, i dont want to be in gold. Im disappointed in the way gold and silver has been trading over the past two weeks. Well follow the market. A quick break. And well come back with more trades. People get anxious and my office gets flooded with calls. So many things can go wrong. Its my worst nightmare. Every second that power is out, my citys at risk. Siemens digital grid manages and reroutes power, so service can be restored within seconds. Priority number one is keeping those lights on. It takes ingenuity to defeat the monsters that live in the dark. Its not just a car. Its your daily retreat. Go ahead, spoil yourself. The es and es hybrid. This is the pursuit of perfection. Great time for a shiny floor wax, no . Not if you just put the finishing touches on your latest masterpiece. Timings important. Comcast business knows that. Thats why you can schedule an installation at a time that works for you. Even late at night, or on the weekend, if thats what you need. Because you have enough to worry about. I did not see that coming. Dont deal with disruptions. Get Better Internet installed on your schedule. Comcast business. Built for business. Yesterday marked the 15th anniversary of the september 11th terrorist attacks. Today canter fitzgerald, which lost 658 of new york employees on that day is continuing the tradition of giving back with help from big names as well. Dom chu joins us from the event with a very special guest. Dom . All right, so, scott, new york sports fans are going to need no introduction to d dd grigorio. Thank you for joining us here from the cantor relief day. What charity are you supporting . Im, first of all, im here for the helping Hand Community and it is something you got to give back to the community, not just were here, but not we only play baseball, we got to give back, talk to people, give back and got to raise money for some good causes. With these causes, tell us how you got involved with Cantor Fitzgerald. I met jolie, the sister from one of the people that passed away in that tragedy, 15 years ago, and, you know, thats why they raised the event and make it everything in this name, and, you know, it is something they do for underprivileged kids, give them a chance to do all the talents, all the stuff, having a chance to do stuff on their own. A little bit independence, teaching that, so it is something really great. So they hand it out and doing a great job with it. Make the case, tell our audience why they need to call in and start trading with you. You got to call in and helping is for a good cause, good charity, a lot of people here, you get a chance to talk to me or one of your favorite athletes thats here. I mean, it is something really good. Thank you so much for joining us on the Halftime Report. It is a great thing that Cantor Fitzgerald does and yanks making a nice run as well. Dom, thank you. Final trades just ahead on the Halftime Report. The highly advanced audi a4. Or keeping a Hotels Guests cuttinconnected. I to 35,000 fans. Businesses count on communication, and communication counts on centurylink. Our customer is a our 21yearold female. Heavily into basketball. Wait. Data just changed. Now shes into disc sports. Ah, no shes not. Since when . Since now. Shes into tai chi. She found disc sports too stressful. Hold on. Let me ask you this. Whats she gonna like six months from now . Who do we have on aerial karate . Steve. Steve. Steve. And alexis. Uh, no. Just steve. Just steve. Just steve. Live business, powered by sap. When you run live, you run simple. Were less than 24 hours away from the sixth annual delivering alpha investor summit produced by cnbc and institutional investor. Were going to be there live tomorrow in new york city and we will be joined by the investor jim chanos, founder of kinikos associates. Were excited about that. Oh, yeah. Lets do our final trades. We were talking about the fed possibly raising rates and what sectors to be in. I didnt mention financials. Josh did. But i think there is a lot of places in financials you can look. One of them being citigroup, below book value, we talked about this a lot, potential for dividend raise. A lot going for it. And if the fed raises rates, thats good for it too. Yep. I like the financials as well, be they wells fargo. I think any of those two stand out, b of a where relatively large position. Look, the market is about seven years old and nothing wrong with taking a little bit off the table, keeping dry powder and staying there. If the fed centers out, throw some water on the rate increase and the end of september, thats one thing. Thats not my bet. To me thats going to be the key. Lockhart will speak later. We know what hes going to say. He already said it. So im going to watch her and take my cue from everybody will be watching all along the curve during that speech as well. 1 15. 15 minutes away. I like mastercard. I mentioned earlier in the show. This is a stock with resistance above 100. Looks like it wants to challenge. I think it gets through. Fxy, i mentioned consensus before, the yen is going in a direction that no one thought it would, it is good, safe haven defensive play. I noticed the nasdaq is up 1 here. If you can dow, s p 500 on pace. A nice rebound today. Dow at the highs of the day. You got brainerd 15 minutes away. Power starts now. Scott, thank you very much. Gentlemen, appreciate it. Tyler matheson here. Power lunch coming your way. Moments away from potentially market moving news as scott just mentioned coming from fed governor lyle brainerd. Donald trump on the attack saying janet yellen should be ashamed of what shes doing to the country. More on his comments ahead. And Hillary Clintons health, front and center, following her abrupt departure from a 9 11 Memorial Service and the disclosure she is suffering from pneumonia. Is this a turning point in the race for the white house . Power lunch starts right now