It was really the trading view u that got goldman. Bank of america on fixed income, up 30 . Goldman sachs flat only up 1 . On the earnings call, new incoming cfo is first to deal with. He said there was particular focus on weak commodities where they have a higher exposure. In general, he said it was lower volumes, not because of specific positions. He said it was a volumes things and said no quarter particularly defines the franchise. This doesnt mean our franchise is broken, but a big outliar. On the other conclusion, i spoke to one investor and he cited the fact they dont have the big commercial bank to off set things and therefore, they werent getting the flow coming in from other areas. We did see that in terms of jpmorgan citi. Which is something to bear in mind. I thought it was interesting on the Conference Call from marty chavez say thag the vix when it comes to u. S. Dollar euro was low and the Oil Volatility was very low so it was a cc and the thick that really got Goldman Sachs. At this point, weve seen the Bank Earnings come across and youve been following these carefully. You take a look since data where they report ed last week or tody and all of them are lower expect for wells fargo. What do we take away from that . I think its Goldman Sachs specifically. I dont think you buy right here. I think the franchise sh you have to question high whooi is fixed down income gwen for a second First Quarter. When you look at the revenue, a third of their total yearly revenue is comprised in the First Quarter, so its a problem they have underperformed here. As o opposed to the second. So i think its definitely a problem. I think clearly today, its overshadowing what has been a lot of strong bank earnearnings specifically bank of america and its evolving into an ugly take. I think you cant underplay how big a surprise this is for Goldman Sachs. That doesnt have to mean it means an unwind in the banks trade more broadly. If you think about this, the its been more focused on the yield curve sensitive parts and pnc, jpmorg, all devered well in terms of net interest income. Citigroup didnt really, and thats more of the trump trade. I guess my point in bringing up the price action is even with with banks with the good earnings, they are trading lower from before when they reported the good earnings. The banks cant catch a bit of this. Thats the point. Rates are going down. Banks are not goiup. They may not collapse. Theyre down 10 to 12 from the march 1st high, but a lot of them are still up 20 and 30 from the lech, so you can see why theres this turmoil going on, but as long as rates are going down, this is going to be a top, top group. I think there was a lot of other things in bank of america. There are a lot of things in jpmorgan. At gold man, three out of four businesses saw double digit growth, but obviously, people trade goldman oncapital market, that was a dispoim. I think the group will take a pause until rates stabilize. You said you were interested in financials, but you would be on the sidelines for now. Is this the bullback you buy . I think right now, theres three things driving banks lower, the first is weaker data and we continue to see the data in the u. S. Get revised down. I think were at close to the bottom. I want to wait until after the French Election because if you come out of sunday with a good result, makes it to the second round, ipg youre going to see cyclicals bounce significant and financials bounce on the back of that. When im looking at bank of america, that number is incredible. Every category. What happened to it . Look at the price action today. Look at where it started . I think it stunk a little. They didnt stink. Look at wra wr the stock started today. The rest of the market and global new, Everything Else starts to pull down. I think goldm man stax started n acceleration to the downside. Equity trading was so disappointing there. It was incredible when you look at what Goldman Sachs, jpmorgan kicked it off. Then suddenly, we hear from Goldman Sachs and its the one outlier thats so bad. Youve got to wait on goldman. The others are a good idea. In fourth quarter, goldman crushed it. You have to say this is a one quarter thing. It was a whole bad that should be the home run quarter. That name in my opinion is the one name that has been accelerating more so to the downside as the bank have been going. Look where the high was for goldman and where it is now. Its been trading poorly. I governor go love Goldman Sachs. The sentiment was down, but it was flat versus a very weak First Quarter 16. So didnt look good at all. Theres no sugar coating this quarter in trading revenue u for Goldman Sachs a and it will be interesting to see what Morgan Stanley do tomorrow in case that was a single stock thing or shigtly wider. Back to the biggest beneficiary of the trump trade, even though moving big on the dow. Theyve delivered again on net interest income, the key thing linked to that. Their guidance for q2 was that it would be softer, but continue to improve. Qfo saying that yes, longterm yields have come down, therefore, the improvement next quarter wont be as good, but it will get better. As opposed to quarter on quarter training. Dr. Jay . I like whats going on with bank of america of course. Prz and i do think when youre robbing from peter to pay paul, which is a lot of wapd here with Goldman Sachs, i think a lot of, it wasnt the gold man traded badly, they didnt get the revenue, the sales through their desk they expected to get. That the street expected them to get. So, whether thats j ppmorgan tt pulled it away, ubs, whoever it was, i think goldman is still doing what they do well. They didnt get as much flow. Was some of that because Goldman Sachs is such a trump trade, not to the extent that wilfred just outlined . Clearly, bank of america. But, when goldman runs to 260 or nearly 260 and makes this dramatic pullback to 215, was some of that because people were backing away because bannon, some of these folks that had strong tied to goldman back in the day. Was that a vote against doik some business there. One is is Goldman Sachs. Is that because they dont have a big Corporate Banking franchise . Therefore, they missed out. The other big loser, wells fargo, when you thought loan growth was ed the debt capital. And the universal banks in the middle are the ones that have really performed, particularly the ones like bank of america. Its interesting and ironic that wells fargo is trading slightly above where it was trading before it releases its bad earnings. I think it is the one thats okay. I think if people thought that was the kitchen sink clutter. In terms of expenses, were so high and actually, i thought the ceo of sloan were going to get their rate down, which is not close, hey to 59 , but they are having an analyst meeing in may. A pd the stock is on a valuation basis, its attractive. I was buying it on friday. Who else was buying financials here . I dont know if they translate directly into Morgan Stanley. For Morgan Stanley, i think more than gold man saks. I thought the earnings call, it was a little bit dismissive, like dont worry about it. Regions financials, rf, the stock isnt trading well. The buying, they were going out to august when they were buying the call, they went out and bought some time. Expecting to see the stock take time, but recover and go back, test 16. Clearly, Morgan Stanley is the closest companion. The big difference between the two is who has been committed to their fixed income training business over the last decade. Goldman sachs is the one that didnt pull out of it. Well, thank you for breaking it down. More questions are being raised about the potential for tax reform as Steven Mushin saying the its likely delayed. We opened the paper so see an article saying democrats are going to demand trump release tax reforms before they can get on board to tax reform. What does this mean for tax reform and also for deregulation . All the things that follow tax reform . Why . Ipg thats ridiculous. It has nothing to do with the president s tax returns so theyre going to obstruct the business of the people because of a person bias against something theyve been arguing about for the last six months. What is important is when you look right now and you expect the one thing that wall street and the markets want, which is tax reform, when we will deliver on that and the further that gets pushed back and pushed and pushed. Again. It is going to happen late in fourth quarter. At best. And probably be put in place in january of next year. I think what we want to see is a clear budget plan from the frump administration, which would provide details in may with regard to what the tax policy is going to look like. Quarter adjustable i right now for the time being looks dead in the water. Theyre probably not going to be able to bring the rate down to 20 or 15 . Theyll probably bring it closer to 25 , so we get light tax reform and tax cuts and thats going tok beneficial. We saw it particularly respond to the notion that border tax as is is off the table, so pete, what do you do with consumer discreche nation . They reacting ooefb though people thought it was dead any way. I think we are so coupe econy everything and every news story is bigger than the other one. We just continue this whole process. One day its taxingses, one day, repatriation, the border adjustment tax. Im still going with the concrete facts. I look at these earnings and other than fwold mann sax, they knocked it out of the park, so i think there are opportunity, and if were going to see lislides the market, i think that creates tupts. I think theyre good counselors to the president as far as people who look at it and say what about the health care and why does that tie into this. We know on the business side it ties into it because if if taxes get adjusted to pay for health care and or they change something about the 3. 8 tax, then that impacted how much mr. Minutin has to account for as hes saying im not going to have enough revenue in to make these kinds of adjustments. So, i think those two gentlemen are key to getting this done and thats why hes being a realist. Saying what aaron said, which is late in the second half of this year, we should get manager done. August was ambitious. Unless health care was addressed and it has not been. Got to take a break here. Heres whats coming up u on the halftime report. The calls of the day. Jeffreys initiation on consume every staples. Kimberly clark, colgate and clorox. Plus, the netflix trade. Marks take on the subscriber slowdown and whats next for the stock . And a brother versus brother debate on united. John and petes bull versus bear case on the airline. We want to hear from you. Go vote in our twitter poll. At halftime report. Were back in two minutes. Big moves on the street today. Mcdonalds hitting a new high, this after the stock was upgraded. The second in as many days. Pets are you on board . They have a price target of 160. That seems high and i think that multiple will be b high unless they can grow into that. But theyre going to have slush slu slush slushies and technology. Theyve got to improve the menu and drive through. Thats what theyre doing and where theyre ahead of the game. They also talk ed about some international. Strength in japan, in the european markets. I think 160 is a pretty aggressive target. Im not in in it now. Around these levels, it is a little lofty. We havent seen it. We get a pullback, thags going tong a great opportunity. I related to cmg trading at revels not seen since april 2016. I mean, i can see why its going higher. Comps are getting less bad and they took this price increase, which shows theyre confident in the recovery, so i totally see why this stock works. 18 months into this thipg. The food thing. Would you rather chipolte or mcdonalds. Cmg. Cmg . Its a more conservative play. Erin . Cmg. Interesting. All right. Lets continue here, kimberlyclark hold rating, joe. Hate those neats. These are the valuation is getting rich, which in the Consumer Staples sector, it is 21 times dividend yield still strong around 2. 91, but speci c specifically, with kimberly, about troubles in the emerging markets. The only problem the they are recover, rebounding, healing. If you are in the name, what do you do with this call, maybe put a stop down below. Buy some put, sell half. Maybe you dont want to dedicate new money to it. There are other places you can x go. Tyson foods. Thats coming around lately i like cvs. Finally stabilized. Thats moving forward, so if you want to reallocate into other areas, fine, but overall, i dont think like notes when they say, okay, valuations full. How do you know that . Thats a good point. This is another related call here. Rating, 78 price target. Ditto. Because of what joe said . Its a great quality company. It just trades at 23 timed forward estimates. Thats lot of money to pay for a 1 kind of organic growth number. Colgate is interesting. Great brands and that would really build out the global scale, so i wouldnt be negative on this name, just dont know if i want to add to it right here. So, you dont hate these calls. Joe is saying these are phony calls. Who says valuation is is full, who knows that, but youre saying 23 time, you know that. What im willing to pay for after 23 times forward is not 1 organic growth. Possibly even negative because there are so many challenges right now, so thats bwhy i hav time addeding here. If theres pullback, i like this one because there may be so some takeouts. Clorox gets a hold out. Bold call. Also shlgs bay clays. Came out with something, everybodys kind of neutral on this one. Its not a terribly exciting stock. Not at this level. Froms it is sort of interesting that these three stocks are up. Because of the defensive environment. Its hard to get really excited. If its overvalued, these stocks may not be defense. If you start to see the tenyear backing up, youre going to start to see people taking money out of these things. Up after strong earnings. Johnson and a johnson falling. Second worst performer in the dow today. Pete, on j j, concerns on the diabetes franchise. Thats the issue you love the fact j j offers you so many different pieces of the puzzle when talking about what they do and their different businesses, but thats whats hurting them right now. Obviously. I think the unh thing, im looking at j j, unh, what a great performance. The numbers. Unbeliev unbelievable. Minnesota company of course. Theyre managed so well and across every industry, they seem to be able to perform. Up 31 in the last 12 months and while huma na and aetna were trying to get together, then anthem with sigona and theyve got issues with their merger, its look k like they could focus United Health on growing the base. They did that. They added 1 million. The network is upful . Theyve had clear vision. Theyve pulled out. Theyre still gaining business from the government. Not necessarily from the afford b bable care act. Theyre pulling from there. Absolutely. They stepped out of there. And that looked like a right move, but this is a winner. This is a 169 that looks like it wants to go 175, 180. Love united. I own it. Happy to see it raised, but i think csigona is where your goig to see more upside. Netflix down today, but mark still a believer in the stock. His reason, why. But first, a check on the dow 30 and unh. Speak of the devil. Top performer on the dow. Dont forget to go vote in our twitter pole. Is n is now the time to buy United Airlines . Halftime report back after this. . I need the temperature for pipe five. Ask the new guy. The new guy . Jack trained him. Jacks guidance would be to maintain the temperature at negative 160 degrees celsius. That doesnt sound like jack. Actually, jack would say, hey mate, just cool it to minus 160 and were set. Good on ya. Oh yeah. Thats jack. The power of innovative thinking. The power of 100 of the worlds top companies. The power of an etf. The power of qqq. The thinking we put in, clients get out. Power your clients portfolio at powershares. Com qqq. Before investing, consider the Funds Investment objectives, risks, charges and expenses. Call 8009830903 for the prospectus containing this information. Read it carefully. Distributed by invesco distributors inc. Containin this information. Read it carefully. Im dr. Kelsey mcneely and some day you ghbe calling me an energy farmer. Energy lives here. Check out shares of netflix. Down by two and a quarter percent. Expects growth to pick up in the second quarter. Is this enough reason to buy the stock . Mark is joining us live from facebooks f8 conference. Weve got to start with netflix. I dont mean to be a Glass Half Full kind of dwirl girl, but when i look at comment prosecutor the Conference Call, little harder than the last 10 million. I thought those were surprising comments from them. The number one metric on the metric is subs. What i found most interest, i thought this was a push quarter. I thiought there was something n there for the bulls an bears. I thought the outlook, essentially implied is theyre going to add more International Subs this year. It tells how hutch momentum they have in a wide variety of markets. This is becoming a global media company. The success is proving out. We like the stock. But every single sub they add, international or u. S. , its going to be a subscriber that is going to be more costly to acqui acquire. That seems like a lot of money to spend and im interesting in the differentiation between the marg margins on the u. S. Versus international sub. I was under up the impression that the International Subs had a lower margin. They do now. Internationals in launch mode. Theyre not, this last quarter, they generated their first ever international profit. The losses have been coming down over time. I think the single biggest miss that the street has that wall street has on netflix is the inability to see how profitable international could be. Its a very hard thing to prove, but their oldest mark