Before . Well, there is some catalyst pushing us around, and the catalyst and we have talked about it time and time again, over the last month or two, and the correlation with oil, and 37 to 42 is the new range that we are sitting in with oil. If oil breaks through, judge, that is because the primary catalyst in my opinion that has been moving the markets, and that is where we areal following the very closest, because you can talk about the dow or talk about the 10year or the chinaer to fed i was going to talk about the dollar. Make the can case that the dollar is the most important thing. Well, it is important, but you can almost right now close your eyes on the weekly basis and not every single day, but on the weekly basis, close your eyes and see where oil is, and you know where the market is. And rob, is this the time, maybe it is, sentiment is different than what it was in the beginning part of the year. China is maybe beter thab it was in the beginning part of the year, and oil is stabilizing from where it was in the beginning part of the world, and the dollar has come down from where it is at the worrisome higher point on earnings, and sentiment and Everything Else . Well, maybe some short run things that have come off of the table, but overall, over the long term, this is fedinduced, still. You have slow growth, low inflation and i think that in a supportive policy environment, and what that is going to lead us to is the same thing that has driven the markets over the last several years. I worry that markets are pricing in a little bit too dovish of a tone from the fed, and there could be a surprise in some of the ae yas of the market. We could have led year to date, because they are loose policy induced the recoveries whether it is utilities or the emerging market markets, so you have to be careful. I would say in the shortrun, we are probably overbought, but long term, you know, if there is a dip, i think that you still want to be a buyer. Jimmy, do you see it a different way . Well, similarly, and i want to focus in on a kocouple of things that rob rob said. We are in lowgrowth environment, and gdp is tracking 1 , and last quarter 1 here in the u. S. , and guess what . That is not large enough or big enough numbers to get meaningful stock market appreciation in my opinion. So we have osee the gdp growth in the u. S. Closer to 2, 2. 5 , and the problem is that i dont see it coming. Appreciation from the alltime highs . What is that, scott . And what do you mean stock market appreciation . Meaningful higher than the a alltime highs. And you right to point out that we are 1 away from alltime high on the s p 500 and it is possible to break through it, because the momentum is on our side, but what i said yesterday the fundamentals are lousy here, and it does have me worried. But you have to be amazed at the resilience of the market, and you looked at what happened after sunday, and no opec deal reached, right . That could have been a powerful catalyst for a negative market reaction, right . And you didnt have it, so when you have the mixture of the underinvested investors, and the low expectations, this is the type of thing that can happen. And i will tell you that in terms of the amazement, joe, from the february 11th lows and the socalled diamond bottom or whatever you call it, the materials are up 20 , and energy up 20 , and the financials up 19 , and the discretionary 17 , and industrials, and so has anything materially changed from mid february . Yes, they had a g20 meeting and went to the back room and made a deal, and they wont admit to it, but they did and that is why the Federal Reserve backed off and the u. S. Dollar is lower, and what is the risk to the whole strategy . The risk is that the s p 500 goes through the highs of last year, and keeps appreciating and then the surprise in june, because then the Federal Reserve has the free pass and the markets are great, and now we can give the extra 25 basis points that the street doesnt really expect. That is the risk, but in the near term, sentiment is incredibly bearish still, and everybody is skeptical. Pete is talking about the oil, and it is well, somebody is pushing the market higher. Those are the shorts. Those that are short are pushing it higher. And crude oil is 41. 15 and the next stop is to go through the 42. 17 high from last week, and then off to the races towards 45 and what is that going to do to the equities . That is what i said to germany gundlach and what do you think about the rally, and he said it is last man standing, and i said how long is it going to be lasting and he said well, the air is thin. You could be at base camp, and it is still thin or sell and go away this in may is the trend. And it is dramatic the speed and the velocity in front of us, but looking at the list while joe was speaking, scott, you look at the energy, and the materials, and the finance, and it has been for the most part, and now it is great participation but dash for trash, and those not performing is where a lot of the money has gone. The caterpillars. And a great one, how about the fact that ibm on february 11th their 152 stock hit 117, and they still cant make money. So what has been hit the most, the emerging markets, and brazil, and going through the list of what is the reaction and the reaction is extremely fast. And everybody is surprised by the where we were and the now where we are. Right. And people were surprised at how low we went in february. That is definitely an overreaction. And the upside is 26. Well, a lot of it was an overreaction as well, and looking at china, and everybody thought that the floor was coming out underneath the chinese economy, and you had year over year numbers announced by the government gave a 6. 7 gdp growth rate, and this week, a quarter over quarter number that indicates more like 6. 3 , and people are not paying attention to the negative numbers when they come out, and that is a negative data point, and 6. 3 versus 6. 7, but it is not being paid attention to it. And it is the momentum of the tape, and it is a sellers in the e be ingoing of the year, and now silt a buyers. And the momentum. And the buyers tape, but it is not aligning to what the overwhelming holdings were. And so think about coming into the year, everybody wanted health care, and everybody wanted the consumer discretionary, and give me some applea and the amazon, and best of breed, and to petes point, not only is it going up, but it is the wrong names. The value over growth, and we have discussed it the last two months. Worlds best values are really, really struggling this year. And intel is not. And it is a really tough environment. And there are different environments, because if you are talking about basic materials, a rnld energy and talking about the dash to the trash, that is what we are talking about, then Higher Quality values, and the cyclicals that are not tied to the commodities or the old line tech names that should be moving higher and you have to make the distinction and so far the market hasnt, and that leaves vul nrability in the basic materials and energy names. And rough shares of netflix, and the subscriber guidance is lower than expected, and Julia Boorstin is lye with us. Hey, scott. The earnings beat expectations, and the stock plummeted down about 11 , and disappointing guidance for the secondquarter subscriber numbers, and overseas growth in particular the projections are falling short of wall streets expectations a. Number of the analysts are lowering the targets as they reiterate the buyer neutral ratings. Noting that they will face difficult subscriptions over the next two quarters, but rita hastings, the ceo dismissed concerns from competition of hbo and hulu and others, saying that expansion of tv players is a good thing. Only the inhibitor of our growth is how great is the service . Can we make it so there is never buffer, and starts up instantly, and the recommendations are credible and the content is exciti exciting. If we continue to do that, we will glow globally even though hbo and dish are also growing. And the ceo ted cerando said he is not interested in acquisitions, but they want to grow the company organically, and not interested in buying sports rights right now. Certainly interesting area to watch. Thank you, julia. And speaking off buying selling, and tom najarian, you saw an opportunity, and joining us now, what is the buyin, doc . Well, i like to buy it in the afterhours and i did not sell it like an idiot at 101 and change where it opened up, but nonetheless, traded out of that stock, and got into the option position, judge. So instead of spending 300,000 which is what it would have cost to buy 3,000 shares of netflix this morning, i bought some calls, and sold some upside calls, and spent just 48,000 or 0. 06 of that the. And if this stock is over 100 but tween now and june, i will make 400 on the june. The reason i bought afterhours, is because it was on sale, and the options dont trade in the afterhour, and so i had no choice, but as soon as i could this morning, traded out of it, and got over into the options side where i can define the risk, and get in here, and love what Reed Hastings had to say, and on demand is where everything is going, and we checked with kensho and you know, nbc has a partnership with them, and checked with them, and last time that netflix has dove 5 , each time outperformed the s p 500 over the next three months, and in fact, the last time in october, it beat it by a substantial amount. Cool. Doc, we will see you back here soon. Thank you, judge. All right. Jon najarian, dr. J, and here is what is coming up on the Halftime Report. Still ahead, the ibm hope trade, and the number one analyst on the stock weighs in on the turnaround story. Dont think about it, just because he is on your show. And plus, pete najarians High Conviction buy. The Popular Consumer stock that he is liking for the long haul. And energy is on a tear. We have got your game plan on how the play todays surge and crude. It is all coming up on Halftime Report. Man 1 i came as fast as i could. Whats up . Man 2 this isnt public yet. Man 1 what isnt . Man 2 weve been attacked. Man 1 the network . Man 2 shhhh. Man 1 when did this happen . Man 2 over the last six months. Man 1 how did we miss it . Man 2 we caught it, just not in time. Man 1 who . How . Man 2 not sure, probably offshore, foreign, pros. Man 1 what did they get . Man 2 what didnt they get. Man 1 i need to call mike. Man 2 dont use your phone. Its not just security, its defense. Bae systems. Welcome back to the Halftime Report. Tesla shares are reducing after a report was released saying that model x had issues. And there is problem s wis with quality of the new version, and there are reports that the company has seen some issues with the model x builds, but the issues are not widespread and the report says that the quality issues are expected from brandnew models, and tesla just recalled model x models because of a third seat that failed safety tests. Thank you, dom. And i would like to ask you if you like the stock, and everybody says no, because i know what you are going to say. Okay. Moving on. Pete najarian is known for a nimble trader, but he has a bull ish bet that he believes is a longterm play, so why do you like it . Well, it is starbucks, scott, and we have earnings, and in the short term, i am looking at starbucks, and i like what they are looking like going into it, and option activity on april 7th, and jon and i talked about it, and the 664 strike calls that hit, and that is something that got me back into the stock. If this sells off on the earnings in terms of the catalyst, that is when i would actually shift out of the options, and obviously not going out the way i would want, but shift out of that and consider the stock, and anything underneath 660 a share, and the reason is so many catalysts Going Forward and if you break out what they are doing in the asian markets, that area could be something that is absolutely unbelievable for them, and it is not just that, but the mobile pay, an all of that as well as getting themselves involved in the right way, i think in selling the merchandise in different venues including the costcos of the world, and they serve it on delta air lines, and pa partnerships, and starbucks is reasonable under 60. Back to tesla or an second, because i have said that i believe that the tock is going to 300, and last july, 285, and 262 in the last run, and josh brown pointed out the potential for there to be a double talk, and this news of the roll over of 240, i want to take away the 300 market, because it is leaning away from what josh says. It fails at 282 high, and where it is is now, it is not looking good technically. And the reason i said what i did, is because i get tired of hearing the same old target, and from people who i am not saying that you have to like it, but the valuation, and the valuation, and i cant buy it. It looked good technically and looked like it would take out the highs, but i am with you. It is great to move on. Move on. And trader blitz with four stocks making news today. First up is ill lumina, and wow, what a disappointing forecast, jim. Yeah, and i really feel bad for the holders of the stock, because it is a terrible time, and the stock quintupled in the years 2013 to late 2015, but it is cut in half, and really what this is a story of is that if you are going to be buying a growth momentum name here, you have to have the earnings to support it, and the earnings are not there to support this multiple, and hence off 50 from the high. It is a tough stock to own right now, and id stay away. But the earnings are there for united tlt health . Yes. And getting above 130 and that is the bellwether and a lot of the commentary talked about pulling out of the obamacare state, and so i believe it is above 130, a weak long shakeout, and down the 120, 125 and long or term, it is a great secular story. Harleydavidson . Well, it ha had a nice trade of over 47. And total reversal up this morning. Yes, and usb was going to propel the north american sals,s but it did not pan out, because the strength was internationally at 4. 5 , and domestically down 1. 5 , but that is concerning, but when you look at the valuation of the stock, it is a buy and a yield, and i like it Going Forward. And freeport, robbie, they were downgraded today, and up 74 year to date and speaks to a number of things. The dash for trash stock, and what is taking place in commodities and iron ore, and what are you seeing . Well, from the macro standpoint, it is clear that the cyclical markets like dovish fed and weaker dollar. So you have seen a rally in the areas. I think that it can continue for a little bit, but you have to worry the minute that there is an inflection point, and id be careful. Okay. Coming up, debating the ibm turnaround trade. Any believers on the desk . The streets number one trader on the stock will join us after the break. And as we go to the break, the halftime portfolio. And who is in the lead . There it is, we have pete trying to work back into the green, but we are back after this. This morning i read over 4000 articles on leukemia. In less than a second. speaking japanese i can understand euphemisms, idiosyncrasy and complex metaphors. I know every detail of every public Quarterly Report in the last 20 years. And im just getting warmed up. Hello. My name is watson. Together we can outthink the limits of whats possible. Welcome to the cognitive era. I want to show you the markets here and it is a different story than what hap n happened here with the game going op, and the dow is giving up 18,000, and the s p 500 and you did have the dow with less than 2 away from the alltime hi highs and giving back at this hour. We watched the market move around a little bit, and there are a number of cross currents today, whether it is earnings or disappointments from ibm falling sharply, and this is what jim cramer had to say about the stock this morning. I would not buy this stock ahead of when tony sack is on the show. I would not do it. If you want to buy ib, in, wait until after the Halftime Report. Watch it and then see if you feel good about it, because tony could put the wood to it. He could bash it up. He gets, and he has the ability, because he is number one. So your show is going to be determining the direction of i be, m and not ig in that we say here. And all right. Lets bring in tony who is the senior analystt a Sanford Bernstein and a whole rating on the stock, and 135 price target, and tony with that buildup from cramer, the pressure is on big time, and the note says it all, the hope trade fades on q. Are you a downer on ibm . Well, look, we have been cautious on the stock for a while, because it is a very big company, and it is understood going a transformation, and there is a lot of at foot there, and when we look simplistically at it, and say, is the transformation occurring . Is the Revenue Growth improving and the answer is that we have not seen it yet. It is very difficult to make a bet on the stock that is trading at about 12 times cash flow which is very much more expep issive than the comparables without really feeling confident that a turnaround is afoot. And tony a quick question, it is pete najarian, and looking at the legacy business versus the transformational side, and the security and the cloud and all of the rest of it, but at what point does it tip the scales . I know that it is right now 37 , and that is the only growth that ibm has, but because of that, when is that going the kick in . Does it need to be at least 50 of what we are looking at right now this is well, look, that is the operative question. So if you are going back five years ago, those strategic imperties were 10 billion in revenue, and today, they are 30 billion, and if i had said five years ago that ibm would have a 10 billion going to 30 billion, you would have said that the company is going to grow, but what has happened is that the rest of the company has shrunk by 20 billion. And so the company is significantly smaller despite the fact that the initiatives are doing well. Right now, they are not additive, but simply replacing the business that is being challenged by secular forces. I dont believe there is a crossover point, and we sneed to see that ibm is going the grow incrementally, and they are capturing client wallet share, because they are simply replacing the business that ibm used to do and other kinds of products and services, but they are not net accretive to the business. So the math says that as the math is larger, the growth should improve, but it has been happening for five years, and it has not been any improvement, and the growth has gotten worse. When does ibm deserve the benefit of the doubt that the transformation is actual ly taking hold . Wel