To fruition. What it means for the streaming and the streaming place. Im courtney reagan, in this evening for melissa lee, coming to you live from studio b at the nasdaq we will start with apples revenge. Shares jumping 2. 5 in the session and adding 65 billion to the companys market cap just today, by the way. The stock closing above its 50day moving average for the First Time Since january the latest move coming after bernstein upgraded the iphone maker to outperform, telling investors to buy the fear. The stock had been down 12 in 2024 before todays call but can the momentum carry apple into earnings coming in on thursday, will it hold through all those numbers . Many of the big tech names that reported last week were under pressure today meta is down 12 since its report on wednesday. So, should investors worry that apple will fall into the same trap after its report or will it gain some appeal as a defensive play tim, youre nodding your head. What do you make of this call . Theyre saying, look, be buffettlike tonys had a great call on apple and i think hes picked out these moments. And i think the core to his thesis is that apple is relatively cheap to the market, relatively cheap to itself but his call that china is more cyclical than structural is interesting. I think that could be challenged, but theres no challenging the fact that apple has really underperformed the market its really underperformed the other mag seven, other than tesla. And apples underperformed the nasdaq 100 by 20 . This has been a big laggard. Its certainly something thats needed a catalyst. You never count apple out. Theres certainly no a. I. Or, you know, the to the extent youre going to have a refresh on the iphone cycle and theres something coming up great. Lets see. Its certainly not a bad call, given how much apple has underperformed i like that kind of a call i was thinking, it couldnt necessarily be a bad bet, but is it defensive i mean, do we even want to count it as magnificent anymore . I think its still magnificent. You look at that balance sheet, theres still a margin of safety were trying to change our definition of what magnificent is that was out of this world growth coupled with a margin of safety given a market thats shown some ebbs and flows and some, you know, puts and takes, perhaps the margin of safety is whats going to cause you to still label it as magnificent. Im just not sure i see the upside i think the downside is mitigated. You definitely want to kind of look at those types of trades, but in terms of the upside, and thats really where the magnificent question really comes in i doubt theyre going to say, weve absolutely knocked the cover off the ball in fact, were expecting weve been keeping this a. I. Tool under wraps forever and now were going to release this and this is going to lead to a reacceleration of growth and a reacceleration of Service Revenue growth so, i dont think that you have that rabbit in the hat thats going to be a surprise what that said, i think expectations are relatively muted, and the news with tesla might bode well for them being some warm spots in whats a cold technological war. Really good points. Dan, youre not rally expecting fireworks all of this apple report, right . Listen, my panelists made some great there it is bonawyn, you kind of nailed it, too. One thing i want to say about tony, weve all followed his work for two decades, he is not afraid to make contrarian calls. Hes not afraid. He has been on the right side of tesla now for a couple of years at bernstein, they dont care about Investment Banking business tony is a great analyst. I like him getting in front of it i dont think theres any catalyst thats going to come out on the call. I dont think theres anything about their china business, some expectations, iphone is down 19 year over year, so, the fact you have that whisper number out there, thats pretty good. I would be surprised if its down more than that, but the point about generative a. I. , what they come up with, theres been lots of reports theyre talking about to openai, to license that, whatever they do will be on the phone coming out in september, october, november. I dont know if thats much of a catalyst right now i would love to see this company kind of derisk from a guidance standpoint right now maybe they give cautious guidance for the balance of the year you know you will get some announcements, whether theyre positively received or not is another story. I think the stock is kind of expensive. If you think about this, Earnings Growth at best, high Single Digits, sales growth at best, mid Single Digits for the next couple of years, trading about 24 times, its just not that cheap and i know tony spent a lot of time talking about Free Cash Flow generation, the way he looks at it from a valuation standpoint, he thinks its relative i just dont know i would rather buy it a little weaker with worse segment into wwdc guy, does it feel defensive, though it has been, without question, on horrible market days, apple is one of those stocks that will go up regardless of what it had been doing in the prior couple days or the prior couple weeks. So, at times, its very defensive. I dont think in terms of valuation its defensive at all. Throw in the fact that margins have been flat lining the last year, year and a half. This is probably expensive we get seduced by the fact that its apple any other company, we would look at valuation, say, this is expensive. And this stock has not performed since july of last year, on a Broader Market thats done rather well. And i admire tony, as well, but if the stock trades lower, they will defend that call and they will reiterate that call as they should the question is, you know, can stomach 12 to 15 of downside, or is it something you say, you know what, i want to be in it, i dont care if the stock goes lower, because this is one of those stocks that you need to be in i still think theres some room to the downside i keep thinking about a. I. , and how apple plays into this. Weve all sort of danced around this, and obviously theyve had siri for a long time what else could they possibly say about generative a. I. , or a. I. Of any kind that would really jazz up investors maybe they dont have to be first, maybe they can be best . Yeah, i think thats fair ultimately, the a. I. Trade is not directly associated with what apple is going to give you, but i do think that the handset, the ability to also have the computing power, at some point, to really deliver on a lot of the underlying ad strength, sure i get back to a company that, guys talking about its defensive nature, absolutely apple was flat on a couple of the big down days. The risk reward to apple relative to its peer group, i think, is very compelling. If you look at the dynamic around their Services Business and the gross margin support that it gives the company, and the Free Cash Flow generation that tony at least references, youre talking about 45 , 46 gross margin this is something thats really attractive the Services Business isnt as sexy of a driver, and its something that will be very defensive in difficult times i think were all saying something similar, which is that, the companys not priced to perfection, though its not cheap. And so, you have something here going into those numbers where i think the bar is very low, and i think we all know the refresh cycle as it gets into dans comment about the fall, thats when you expect this company to do something, but maybe get something in june. Bonawyn, shares are only up 3 bigger risk they go down or up after this report . Probably go up, but again, its really about order of magnitude. I wouldnt really call a 3 move the grand revenge tour no. I think its positive they have broken through that 50day, that gives you shortterm catalyst you can kind of hang your hat on and ride that momentum even he is suggesting that you trade this between a range of 25 and 30 oneyear forward numbers. This is not him saying back of the truck, the valuation, you know, compels one to add this as a core position. Hes saying, this is now an entry point, a compelling entry point for a trading position and i think if youre approaching it from that standpoint, you understand that, sure, you know, i think that the risk reward is more compelling, however, the stock has not gotten to a point where youre now reallocating and taking dollars away from Something Else ill just say this, the stocks that gapped up last week, i mean, look at google and microsoft. They look like good reports. Google was a better report and a better guide relative to expectations than microsoft was, but theyve actually filled in google is on its way to filling in the gap, microsoft has filled in that gap we saw what meta and netflix did, a few others, it was just downright horrible if apple were to have a little bit of a relief rally, because its not as bad as feared, i dont think that sticks. And i think were probably getting to a seasonally weak period were going to get a lot of color on Interest Rates this week, with the fed meeting and obviously the jobs report on friday, but if we have a tenyear thats on its way to 5 , i think this is the thing that has been a cooling agent for a lot of these big names over the last month or month and a half or so, and i think will continue through the course of the summer until we have better clarity when some investors can start to price in lower Interest Rates. I dont think its here. If this stock were to pop and get towards 180, i think you sell it and look for a better opportunity into wwdc, which, again, is not that far from here, but that phone refresh cycle is a long ways away, and anything that they do licensing someone elses technology to go on their phone, they have not been great at doing that in the past, so, i dont expect it to be a big driver for this cycle. Fair enough you opened the door to a macro discussion i want to talk about the yen, falling to another 34plus year low against the dollar the currency weakening to more than 160 yen per dollar for the First Time Since april of 1990 but retreated amid reports the japanese regulators could be intervening to prop up its value. So, tim, what do you make of the volatility in the yen . I remember in 1990 when this happened just kidding, i dont remember when that happened you cannot. You were not born. I was born. First grade. Bojs credibility is shot thats whats going on here. And to the extent that Everybody Knows an intervention doesnt work, the market then pushes as hard as they can if there was one or not, i think guy has a view there was, ill let him talk about that. The ultimate message for banks around the world is something thats scary this is not sending a lot of confidence i think yields have to go higher in japan the good news is also the bad news they want inflation. Theyve had three decades, four decades of deflation, and as weve talked about many times on the show, japan is the largest buyer of u. S. Treasuries, and that doesnt bode well here, especially when their buying power at 160, 155, 145, is not what it was. And i do think its a case where markets will push and push and push, thats whats going on in japan right now, and its not positive for the sense of volatility in markets overall. Guy something happened last night. It traded up to 160, 10 00 our time, within minutes, it was down to 156 and change, 155 and change, so whether or not it was an intervention theyre going to announce something clearly did happen, number one tim is spot on their credibility is shot. They can intervene all they want, its not going to work in order for something to work, they have to raise rates in a meaningful way, but that will crater an economy thats already sort of on the brink, so, they face a huge dilemma here their currency is going to continue to weaken, which is really bad for the people that live there, or theyre going to have to raise rates to defend their currency, which, by the way, is really bad for people who live there and his point about owning treasuries, thats one of the many reasons that u. S. Yields continue to go higher. The fact that this is the third or fourth largest economy in the world and nobody seems to want to talk about it is staggering to me. Bringing it back to u. S. And bringing it back to a company we were just talking about, apple, almost 60 of their sales come from outside the u. S just think about that. Its a very expensive, aspirational product in most parts of the world so, you have a dollar, at least the u. S. Dollar index, is up 4 year over year so, were going to start hearing constant currency. Were going to hear that again and again. We heard it a lot on the Conference Calls trying to figure out what is the organic growth and demand, but some of that can be forwarded by the dollar translation here. Thats a really good point. It isnt just earnings and the dollar on investors radar this week also the fed decision, by the way, on wednesday. The april jobs report on friday. So, for more on all of what this could mean for markets and stocks, lets bring in yungyou ma we saw some surprises with the gdp number, for example, but then the pca came in pretty pce came in pretty much bangon. What are your expectations this week, which Economic Data point is most important to the equity market great to be here, courtney. And definitely a lot of data this week. We think probably the most important thing will be some of the under the hood numbers with the jobs report. We actually think when you look at hourly earnings, when we look at labor force participation, we think thats going to set some of the tone for whether or not the market thinks that the inflation pressures will ultimately be on a downward trajectory, or if we just face a very protracted battle, which chairman powell is probably likely to point to in his messaging on wednesday, so we do think theres a lot of data thats going to come out, the fed will probably be seeing a little bit of hawkishness to the markets and the markets might reprice a little bit the prospect of having no Interest Rate cuts this year. Wow yeah, obviously, weve gone down from six and so, we are far away from those initial expectations. Were almost at the end of april, when you put everything together, when youre looking at the Economic Data points, do you think its going to be that type of year . We dont think so we dont think thats whats advisable here we think the Growth Drivers are in place for the second half of the year we think corporate spending is starting to pick up, and that will be a big driver for the year and as long as inflation can remain relatively stable, that the investors and the market can focus on that growth and profitability thats starting to improve. And we can overall see traj trajectory the more growth we get, well see lift in the treasury yields, which is going to cause tension in the market. Its not going to be a straight line, but we do think that gout is going to win the day, and provide a healthy backdrop here. Maybe thats framing the answer to my question, which, youre a cio, you are managing risk, you are thinking about allocation, seems to me the market has kind of decoupled with the reality of not only not five cuts, maybe not any, and so, do you think that, and do you think that changes the thesis for equities here you know, its not a goldilocks scenario anymore. I think it changes the backdrop. We dont expect the markets to just be this constant grind higher but i think that overall, if you think about how do we tant to allocate risk, we want to have a healthy allocation of risk, and we want to look for areas that can outperform, but no, its no longer the golly locks scenario of having falling inflation, a fed cutting rates aggressively, and strong growth. So, you heard us hopefully having the conversation about the bank of japan and yields, and you dont have to agree with us, but how important are tenyear yields . I think were on the way to 5 the market doesnt seem to care right now. Should it or where will it i do think its important i think the market will start caring if we start knocking on the door of 5 and certainly if we get beyond 5 we hit 5 in late october of last year, so, theres a little bit of experience weve had that definitely jarred the market perhaps caused the markets to be a bit immune to another trip toward 5 , but i think that if we do get a push past 5 , thats going to be much more of a wakeup call for the markets that that level that we reached before could be surpassed and perhaps substantially. So, we do think its a big risk in the market here, and it is something that we think the markets are going to be very sensitive to over the next few months a lot of factors to balance thank you for helping us try to do just that, yungyu, thank you for being with us. Bonawyn, how are you going to put that sort of into your calculus we have to balance amazon earnings and apple earnings, nvidia also coming up. I think heading into the week, this is a huge earnings week, and thats where the focus tends to shift i think weve gone from expecting five to six cuts across the board to now saying zero and theres whispers about more hawkish, or dare i say, rate hikes, so, i think that backdrop has kind of shifted. The gdp number throws in a bit of a question mark were expecting, you know, 2. 8 , 2. 7 , and we came in around 1. 8 couple that with pce, which was slightly hotter. I just think its hard for us to now say were clearly still in this soft landing goldilocks scenario, which makes me refocus on earnings. And you asked earlier if im looking at margin of safety, magnificent seven, i still am looking to that complex to an extent you know how i feel about nvidia i mentioned meta, i think thats a bit of a unique situation there, where theyre now reaccelerating spending. I do expect that to present an opportunity. You know, aapple, again, i think theres a defensive aspect and google was a surprise. I think that stock has been flat, and they had strong earnings there, new dividend i think there are pockets of the market where you can play. I just think that its going to be a lotearningdependent and not so much about a thesis and when and how much the fed is going to cut all right, well, coming up, were watching paramount shares on the move after the companys earnings report. How the ceo stepping down will impact the future of the company and the latest on deal talks, thats next. And by the way, speaking of earnings, sofi getting hit what has investors heading for the door on this heavyweight well explain when fast money returns. Were back in two. Still have a lot of show for you. Youre watching fast money here on cn