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tv   Fast Money  CNBC  July 1, 2019 5:00pm-6:00pm EDT

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the last dime. that was a huge deflating let down let's see what happens and what it means in the big picture. >> if you get a snap back and it's a strong number people say the three month average haven't gotten away from us. fed isn't focused on jobs right now it's focused on inflation. >> "fast money" begins right now. >> "fast money" starts right now. watching the nasdaq. i'm melissa lee. your traders are on the desk tesla, the company set to report its second quarter delivery numbers any day this week. after a 30 puerto rico rally after its low did the stocks come too far too fast. >> one china bull says it could be a good time to buy china. >> dow jumping more than 115 points nasdaq and tech up 1%. we've seen this story before the s&p 500 keeping its head above the highs and preparing to
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launch is the next leg of the rally all about the fed? >> i think it has been all about the fed. tariffs were maybe 20% of the story. i think for me it's about the fed. the fed is in the back pocket of the market the tariff story can only get better from here yes it's about the fed higher markets from here going forward. >> why can the tariff story only get better from here >> we factored in the negativity on the tariff headlines. we've already seen those at worst, right or you don't agree. i do >> tell you what i think you're right in terms of headlines, mark. it's digested months and months and years of headlines what we don't have is ceos and the real impact. when you throw the trade war into a war, leading indicators have been moving lower in the last 18 months you can make an argument this trade war has done things to
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ceos and businesses and earnings that we still haven't seen yet in terms of a market event i can agree with what steve said where are we we're at may 3rd, the last time we got some big news out of trade right before all time highs, right before president trump started to tweet so what we have is a little bit morphed in this environment. but, again, if you look at how bonds reacted today, bonds didn't tell you it's off to the races. gear mandatory bund went to fresh lows the macro data points were not good >> a lot of earnings before the next fed meeting >> unfortunately, i think this is the earnings season where you'll start to hear some of that come out on the conference calls that the ceos are a bit concerned. that they might not have the confidence they need to execute on the growth plans. my concern is if we look out to like the fourth quarter earnings estimates, we're looking at double digit year-over-year growth i don't think that will happen those are still way too high
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they have to come down as they come down the issue is, it will exert downward pressure on stocks and offset positives we're getting from trade and fed. >> depends whether you deem it to be a positive there was no there there it was a calculated situation that happened. what we saw at the end of november into the g-20 meeting and delarge he some sort of victory. it's important every time the s&p has been above the 2900 over the last year or so it had a flush lower. sentiment gets blulish more likely it is to stay up here fine then you may have a break out, you may establish a new range. this other stuff is important. steve, the most important thing to you is the fed then better think about why they have made this historic pivot in such a short period of time to dovishness and when you see this data like we saw about global pmis that should make you nervous, that to me makes the s&p 500 playing for a break out
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at 2950. >> so for me ultimately i do believe it's a negative for the fed to start cutting now i don't think they can combat anything the market has to adjust to the fed cutting now. they go to the most accommodating market a risk on play i don't believe they have enough ammo that's why powell says i'm dovish but i might cut >> july might not happen >> july might not happen best thing you could do is not let it happen. >> is that a flush >> i would think that you still have to worry about, oh, what happens when he does cut what happens when he does hit the 50 basis points. >> the market basically saying 75 basis points between now and year end basically saying 100% in july. that to me would be a major -- >> we did hear from bullard and we heard from powell last week where they are stepping off the gas a little bit on easy money and it was more than two cuts
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versus three cuts. >> do you think the market goes higher in that environment when those headlines hit the table >> knee jerk reaction is for the market sell off if the fed doesn't cut. you know that cut is coming. you just don't know when it's playing russian roulette with the short-sellers who steps in front of this train and shorts the market? >> i don't know. maybe dan. you think there's going to be a flush. >> i think there's a very good likeliho likelihood the president has proven he's a bad negotiator with a good hand and the chinese -- >> why is the market up. it what is it. when you have senators from his own party flashing him on giving away stuff you don't need to give away to get out of the g-20 thing. these are really important parts. not about a bilateral trade
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agreement. not about selling chips to the chinese and buying back the equipment and plugging it into our infrastructure >> i'm not being combative, if the market should not be at all time highs -- so the market should not be at all time highs i'm looking face forward -- so the market should not be at all time highs if he was doing such a terrible job at negotiating. everyone said the chinese had an unlimited time horizon that goes out the window the markets are out there -- >> the chinese have massive concessions. they got massive concessions that our chip guys can sell back to huawei. >> what do they have to do in return >> nothing >> so, folks, let's get to scouts it doesn't sound like anybody is terribly constructive on cyclicality. i think tech will be either
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consumer discretionary names that can be defibrillator. we've gone through fast food and things like starbucks, coca-cola. i think they will continue to work if you think about that which had an asymmetric or under perform response to june of 9% down and basically 9% up look at japan and other parts of the world. i know we'll have this chat. i'll leave that alone. exporting countries of the world if you believe there's just some short term relief should outperform and even apple. again, you can say this is a company specific under performance but most people tied this stock to the trade war. >> so get back to sep 30th of last year, this has been a defensive rotation right? money has come out of cyclicals, moved into defenses. as we start to make more and more progress on the trade deal, we see a fed cut or two, i think
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you'll see that rotation reverse course and you'll see money flow out of defensiveives and into cyclic cyclicals. >> so, which specific one? >> so the tech sector in particular the highest percentage, they have the highest exposure to revenues from china right now. that's way to play >> i would go cyclical i would go with the chemical plays. i would stick with lennar that was beaten up. so i would stick with a lot of those plays don't seem intuitive to the overall market but go back to cyclical paz >> some earns we've seen in the past month in those spaces they are not seeing a hit they are spending right now. those are some areas that look generally insulated. >> own despite the valuation >> yeah. on friday, you were not here,
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but we were talking about microsoft trailing two and a half pe to growth. you talk about apple i can't remember apple had a forward multiple in the high teens. >> it deserves it. >> but we will look back at some point when the s&p is much lower and say oh, we should have been crowding in trillion dollar market cap name that were trading in multiples that were stretched. >> so there's a lot of things that implied in your statement you say when the s&p is a lot lower apple will look like a bad trade. to me it's a defensive company again -- >> mcdonnell's >> significant capital markets offer opportune. a lot of cash. they can basically have it put under the stock. the transition is under way. the bad headlines in terms of their hand set -- >> 40 billion? >> i kind of disagree on that whole thesis because if our consumer is keeping the entire global economy afloat all those
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names you just mentioned if we go to recession, if we have risk assets come in they will get hit much harder than these enterprise companies that have massive -- apple for one >> they are not growing their hand set >> so if it's not growing and they have blockages of certain geographies they can't be like china, then you have an issue with growth. >> we can agree to disagree on apple. are you also saying the other big companies that outperformed like coca-cola, pepsi, as far as bucks -- >> coca-cola is ridiculous sugar water company trading at 25 times >> other times, we've had plenty of opportunities in the last five or six years where people thought we were getting into a recession and time to be running into defensive names and these names outperform every time. >> one of those spots you just mentioned that doubled the worst decline that the s&p has had in the last few years i mean apple sold off 40%,
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starbucks sold off all those consumer names actually get hit much harder when thing get nasty in the bond market >> i'll just move on at this point. our next guest said enjoy this rally while it lasts because this could be as good as it gets for a while. laurie, great for coming back. i was going ask you about your target in terms of this debate where you put your money in this market environment where would you go >> we like utilities, consumer staples, financials. they have dividends in common. when you're going into easy mode by the fed stocks with high dividend yields outperform the nondividend payers the consumer sector acts pretty well in an easing environment so does financials. >> coca-cola, what is it trading
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at, 25 times does that concern you? >> yes >> this is a time when you want to be in these names >> what's interesting to me abo consumer staples they look under value. pes give you sticker shock but you can come up with a valuation case pretty easily >> so, when you take a rook at sectors you like it's defensively tilted what doe that mean in terms of your view of the my. >> the financials is more of a cyclical bet it's where we see opportunity. we do within some of the other sectors like industrials machinery looks like derisk. res >> if you think about the rest of the world, is there a trade that is more interesting after -- certainly under
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performance by, i was talking about japan and ultimately you can make an argument that the earnings revision, ratios in japan, dividend pay outs are much better than they've ever been >> i didn't look at japan specifically but the u.s. if you look at global equity funds it's an extraordinary crowded trade. we saw a little bit of rotation out last year but it popped up but the premium now is at all time highs global investors are looking for other places to put their money but the catalyst has not presented themselves >> we've been for ten years in a zero interest rate and now we have a negative interest rate and maybe that's coming here and one reason to explain why coke is trading 24, 25 times. is that a massive bubble waiting to burst >> i don't think the bubble is sitting in the dividend yielding stocks by any stretch. we had a decade of growth. if there's any bubble in the market right now it's in certain
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parts like entertainment and software where you have nose bleed valuations and unbelievably high allocations in hedge funds. "fast money" trade for these areas of the market. we don't deny the fundamentals there are great but everybody is there. >> you don't think the fed will cut in july? >> so, you know, i look at it from this way. the fed has continued to tell us all they are data dependent. let's look at the data what we saw with the ism data it's slowing but not turning negative we had lousy regional fed surveys but the fed is not slipping into negative territory. they have to provide a justification. we thought our house view was maybe if the trade new york stock exchanges went badly that would for the fed's hand that was fine. i wouldn't say that was any kind of huge positive but certainly wasn't a negative. >> laurie, great to see you. thanks for coming by
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what do you make of sectors? >> i don't like the financials i think that's been -- all the picks are good but they are market perform pick. i want something outperform. >> you mean the market perform picks for you, in your view. >> yes from my view they are up about 14%, 15% the market is up 16% i like the home builders i like that play i like tech. i believe the market can go higher >> so not a big fan of defensive sectors. i can't pay 25 times for sugar water. just not of any conflict of interest to me i rather get involved in companies growing their earnings at a much faster pace, hopefully double digits. software, there's different areas we like. >> everybody is piling up on your sugar water comment >> that's a reason why the stock continues to go higher people has been questioning.
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i don't need to go to bat for coca-cola. laurie did a good job ever framing stocks that are not in a bubble on other multiples. no question coca-cola has been investing in other businesses and vitamin waters and other things maybe one day they will be in cannabis these companies that are cash flow aga flow >> chinese stocks are flying today. up sharply over the past month as trade tensions ease one says it could be your chance to buy tesla is in high gear. we'll tell you what to expect. one stock that could deliver serious gains in the second half of the year and yes that's a hint get a deliver. we're live from times square new york city. tethmoy"ig"fast ne rht afr is -driverless cars... -all ground personnel...
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. welcome back to "fast money" tesla charging ahead of its delivery numbers which is expected any day now elon musk said it will be a record quarter for the carmaker. >> reporter: they have pretty much telegraphed they expect to meet the expectations that are out there on treat
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does that mean it will come in over 90,000 vehicles and below 100,000 vehicles if it comes in at 88,000 i'm not sure people will punish them for that the expectation is for deliveries of just under 91,000 vehicles but the number of people will be focused on what happened to the model 3. the expectation there a little over 70,000 vehicles despite q2 deliveries will be in line with expectation. a real drop off in the expectations from analysts when it comes to earnings from the q2 or to the full year. went down to $4.23 terrible numbers for first quarter. dropped down to a loss of 78 cents. $1.61. now the consensus is a loss of $1.83. people have been talking about well if they make these numbers in terms of deliveries things
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should be good thing should be fantastic in eyes of investors. not necessarily. you want to see what happens with the q2 deliveries when it comes to profit margins. increasingly there's a feeling on wall street that those margins are going to be under pressure in the second quarter because of them ramping up on the production and the sales of those model 3s and as a result when those earnings numbers come out at the end of this quarter, end of this month or early next month that's the focus, what happened with those profit margins. how much were they one pressure, especially in the second quarter. >> all right phil, we should expect these numbers any day now, any moment now basically. >> yeah. you know how this goes could be tomorrow morning. could be wednesday morning could be wednesday night you're not sure. sometime in the next day or two. >> wednesday night would be interesting considering it's a day before a holiday >> get them on july 4th. >> thank you, phil the expectations are, i
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mean, the expectations are high. the stakes are very high for the company at this point in terms of its delivery numbers. >> if you think between 90 and 100,000 this is something that never happened the company guides from 360 to 400,000 deliveries per year. without rehashing the first quarter the thing that was most awful about it was s and x deliveries were down almost 40%. those are the cash cows of the company. those are the cars that make money. the model 3, the margin here is the big story. i still the balance sheet a big story. front loaded demand is really the question what happens in the second half. >> plus you have a tax credit going away or cut in half today. so 3750 going down to 1875 and then goes to zero. that's got to impact margins negatively as well and you pull demand forward.
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and they have to slash prices i assume sponsorship it will impact margins you could see a pop on a good delivery number. i would sell that. >> q3 and q4 will be a much better indicator q3, q4 right in the face of the fading tax credit. no new vehicles out. there's not any additional international tail winds helping you out. so even if this number is fantastic, i still wouldn't get too excited about it i think q3 and q4. >> dan >> it's kind of laughable. when phil was talking about the earnings or the consensus is for them to lose $1.83 in 2019 they are expected to lose $800 million. the question is can they outrun a recession for their balance sheet which you like to talk about but also the demand aspect of that. to me it just seems like, the stakes are high now because to your point the stock has gone
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from 175 to 225 in a matter of weeks. >> are you still short >> i'm still short we never talk about corporate governance or a company that should be trading at a massive discount not a prime, on a massive discount for never delivering on what they say they will do. >> for more on tesla go to trading nation you're watching "fast money" here's what else is coming up. leaving the cage >> with the trade truce the bat stocks are flying. and one strategist says now is your best chance to buy. we've got the details. plus -- >> chipotle, keep an eye on the can by world >> now you're throwing in bitcoin. >> look where that's trading >> millennial trade is heating up this year and the redent "fast money" millennial said there's one stock setting up the party that
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about to get turned. find out the name when he delivers his ft aspitch. there's much more "fast money" right after this
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♪ welcome back to "fast money" china stocks break out after the g-20 meeting and adding to a rebound. the bats stocks are all flying our next guest says this could be your best chance to buy great to have you with us. thank you. >> thank you, melissa. >> you're pointing out the discounts on a book to price basis. you said what's the cheapest relevant to u.s. shares in 20 years.
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what has that told you in the past when you reached this discount >> as much as emotionally can be difficult to buy, buying at the widest disparity ever has been a great entry point for these chinese shares we think it's a fantastic time for long term investors to take a position today >> when was the last time, you know, we've seen these sorts of discounts relative to u.s. stocks and are u.s. stocks overvalued and they should come down versus chinese stocks meet the u.s. valuations? >> it's not just on a relative basis. even in the summer of 2015, melissa, when we had a very sharp downturn in chinese equities it never got to this level on a price to book basis even on a historical basis you make a good point part of this is on a partial basis but on a historical basis we're below the long run averages which is another reason that
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validates our thesis on why we should be taking positions at these levels today >> does it matter what the economic data out of china is. if you take pmis lowest since january does it matter what they exalternatival factors say surrounding this relative to u.s. stocks? >> this gets into our thesis of the tail of two chinas when you look at manufacturing pmis they are contracting. they are affected by trade war when we look at nonmanufacturing pmi like we got last night still in expansion territory we see sales in month of mail were up 8.4% year-over-year. the chinese consumer is alive and well fiscal stimulus is geared to raising domestic consumption >> so just, you may know, but just know i'm predisposed to liking this trade. i will say you actually got the
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eem and most emerging targets trading at ten year lows relative to the s&p and every time they trade lower. why is this time going to be different because frankly you can pick stocks. sounds like you picked a few people could be cynical on this. >> you bring up a good point when you look at broad based emerging markets, etfs like eem, 50% of the exposure in eem is in financials, energy, industrials and materials. that's a value orientation to broad base emerging markets. what k webb does is break out the domesticconsumption story, the growth names those names just like here in the u.s. what's powering the market higher. break those names out you get a much better experience than buy broad based eem. >> thank you for your time appreciate it. you like the domestic chinese story. >> i do.
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i do yes. i think you have to be lettive it hasn't paid to just be in broad emerging markets over the last several years you have to be specific. you have to be selective i like alibaba i talked about that before glitches you exposure to that chinese middle class which is rising they have a bunch of underlying businesses still being viewed as this e commerce giant they do ecommerce, financing >> i like macaw casino names you saw a wynn or las vegas sands pop. i like las vegas sands even though it's up 18% wynn is up >> i like ten cent you look at the peg ratios of some of the chinese names like google and amazon. much more attractive amazon might be the biggest
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incubator in the word that has cash flow generating business. >> k webb gives you exposure to those domestic consumer days decent way to do it because you don't have the credit risk you know they are not facing competition from generally from u.s. companies there and their web market which is primarily mobile is 3 x, 4 x ours this is a place you have to be long term because some of those favorite ones you own here in the u.s. will never be in china. >> like a google >> right you actually think that what's implied in your statement is that basically google, facebook, and amazon are being shut out of china in the future. >> not ever going to have meaningful market share. >> they will isn't that a fair assumption for the immediate future, five years? >> i don't know. if you guys are telling me i should start thinking about different growth in china for all those companies, then i don't think those companies
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should be trading where they are. i don't think the market told you they will get shut out of china. >> the market hasn't told you that google or facebook -- >> it's an interesting time. >> that could be used as something with the trade war negotiate ati negotiations that could change on a dime. >> so to get the data in china this is not happening for at least a decade >> but you're telling me that the mega cap u.s. tech companies are shut out of china effectively right now? >> google. >> i think -- >> amazon. facebook >> you think that's in the valuation. >> i don't think at all. if you told me those companies have zero growth from china and china related i would say those are multiples that have significant room to the down side we all get the national champion story. made in china 2025, one belt, one road it's all about technology.
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we know that if we think u.s. tech companies are no longer going to have access to the size of that market -- >> i think it depends on which tech company i think a company like alphabet, do they want to be subject to censorship laws in china they may not be technically shut out but they may choose to shut themselves out president trump is speaking to reporters at the white house after signing the humanitarian bill let's listen in. >> no message to iran whatsoever >> any reaction to the protests in hong kong today >> i don't think it's solved i was with the president of xi of china we had a great talk, a great discussion talked about doing something and we've talked about it briefly. but it's very sad. we haven't seen a protest like that very sad to see. >> will you be delaying census
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>> we're looking at that we think a census, obviously, if you do all of this work and you -- nobody can believe this, they spend billions of dollars census and not allowed to ask, knock on doors of houses, check houses, you go through all this detail and not allowed to ask whether or not somebody is a citizen so you can other things but you can't ask whether or not somebody a citizen so we're trying to do that we're looking at that. >> why do you think it's so important that that question be asked. >> i think it's very important to find out if somebody is a citizen as opposed to an illegal. there's a big difference to me between being a citizen of the united states and being an illegal. and, you know, the democrats want to treat the illegals with health care and with other thing better than they treat the citizens of our country. if you look at a coal miner with
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black lung disease you're looking at people getting treated better than a coal miner and they got sick working for the united states and we treat people that just walked in doing better look in california how they are treating people. they don't treat their people as well as they treat illegal immigrants at what point does it stop it's crazy what they are doing icht crazy it's mean. and very unfair to our citizens. we're going to stop it but we may need an election to stop it and we may need to get back the house >> when will round of trade talks begin with china >> it's already begun. it's essentially already began it actually began before our meeting. >> do you know when robert lighthizer >> whatever it takes it has to be better for us than them because they have such a big advantage. you can't make 50-50 yield when
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somebody -- i've been talking about this for years we had a surplus, meaning they did on us, of $570 billion so obviously we can make a 50-50 deal it has to be a deal that's somewhat tilted to our advantage. and if we're not going to do that we're taking in a fortune from tariffs we're hurting china by doing that because many of their companies are leaving and going to a nontariff state. so they don't have to pay any tariffs. the other misconception about china, you read an article in the "wall street journal" today, people aren't paying those tariffs in that case, certainly. china is paying for them those companies are paying information. china devalued their currency. very substantiately. they also put a lot of money into their economy, they are pouring money. it's fake money but it's money they are pouring money into their economy to take care of the tariffs. you don't have increased
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inflation. but i'll tell you what is happening, our treasury is taking in billions and billions of dollars of money that normally would be for china. so, we'll see what happens we hope that we can make a deal but it has to be a fair deal we had a deal as far as i was concerned and then at the last moment china decided they didn't like that deal and they changed it it's all right i said will you pay 25% tariffs on $250 billion. >> president xi did he say he would move i >> i expect him to move. if he doesn't move that's okay too. i'm happy either way we have a good chance of making a deal they want to make a deal they are losing many companies that are leaving because of the tariffs. they don't want to pay the tariffs. they are losing many countries some are moving back to the united states where they belong. [ inaudible
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>> the president is doing a great job. he put 16,000 people in this weekend, and they are getting to the border and doing a great job. he has 6,000 people at the border with guatemala. so, i mean, it's been way down it's cut way down. you'll start to see the numbers. [ inaudible >> no, that's true yeah they are doing a good job. right now doing a very good job. it was because of tariffs that they are doing it, but the point is they are doing a very good job and he's very smart to do it because that's a tiny fraction, sounds like a lot of soldiers but that's a fraction of what tariffs would cost mexico. i very much appreciate it. he's doing a great job for mexico because the mexican people are very upset with all of these tens of thousands of people, hundreds of thousands of people walking through mexico and the people of mexico are just as happy as i am with what
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they are doing [ inaudible >> well, i don't know what they are saying about members of congress i know that the border patrol is not happy with the democrats in congress i will say the republicans do want border security the demonstrate want open boards open boards means tremendous crime. if you look there was a report that came out where approximately 600 people in the last caravan were serious criminals. i don't want them in our country. so the border patrol, they are patriots they are great people. they love our country. they know what's coming in you know who knows it better than anybody hispanics. hispanics love what i'm doing because number one they don't want to lose their job, they don't want to take a pay cut and very importantly, most importantly they don't want crime. they one it. the people that under the border the best are hispanics they understand it better than
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anybody. and they don't want to have to suffer crime and they don't want to take a pay cut. they don't want to lose their job. that's why my poll numbers went way up with hispanics because they really understand the border the best of anybody >> you have tanks out on fourth of july? >> we'll have a great fourth of july in washington, d.c. be like no other it will be special i hope a lot of people come. and it will be about this country and it's a salute to america. i'll be here i'll say a few words we'll have planes going overhead the best fighter jets in the world and other planes too and we're going to have some tanks stationed outside. going to be pretty careful with the tanks because the roads have a tendency not to carry heavy tanks. we have to put them in certain areas. we have the german tanks brand-new abrahm tanks we have so incredible equipment, military equipment on display,
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brand-new, and we're very proud of it. we're making a lot of new tanks right now. we're building a lot of new tanks in lima, ohio. a great tank factory that people wanted to close down until i got elected and i stopped it from being closed down. ivt the greatest tank in the world. >> do you think you'll give a speech that can reach all americans. >> i think so. i think i reach host americans most americans want no crime most americans want a strong military they want want good education. they want good health care if you look at pre-existing conditions, the republicans are going to save pre-existing conditions democrats can't do it. what democrats plan is, it's going to destroy the country and be horrible health care. horrible health care and everybody's taxes will go to 95%. by the way, that's not enough. but the taxes, they do whatever they do. your tacks go to 95% and that isn't nearly enough.
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thank you very much. [ inaudible >> do you have a message -- [ inaudible they are looking for democracy and most people want democracy. unfortunately some government don't want democracy but that's what it's all about it's all about democracy there's been nothing ever better we're the best example of it right here in the united states. thank you. >> thank you, everybody. >> thank you all >> thanks. that was president trump speaking to reporters after he sign humanitarian aid bill he spoke about a wide range of issues including those hong kong protests which took a more violent turn today on the anniversary hand over back to china. he said that was very sad to see. he spoke about the china trade deal and how china needs to make
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a deal because they are losing a lot of money he also made the point the u.s. treasury is bringing in billions of dollars in tariffs that would otherwise go to china but aside from all that let's talk about china trade. we were talking about tim cook moving production of the mac book back to china that was an interesting signal to send around the time of the g-20 but ahead of any sort of deal made. >> it's very clear we've seen this time and time again. moving to lower cost production, places don't really work the headline makes sense the idea of moving your entire supply chain to vietnam or mexico is a hard thing it will take a lot of time these announcements have just been window dressing in a time where a lot of these companies have to be very careful in their dance between the u.s. government and china because those relationships are very, very important it took them decades to make those relationships as far as their supply chains are concerned. so the idea of just kind of
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letting them go by the wayside doesn't make scene >> companies have to do their due diligence in trying to move their supply chain because they don't want to be caught on relying on china going forward if anything you see whether it's incremental, people will move their way way from china >> we saw that with cisco's earnings they said in the past six months they are working how to move their supply chain outside of china. cisco had a very good quarter with good guidance >> we've been so lost on just the trade dynamic and really haven't gotten into the details. we'll start gift certificating in to the details so see the cost on margin all great points global supply chain. it's a global supply chain so, if it's not -- you know the u.s. is being cut off from china but no one else is, at some point that will have an impact for us
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there's no question that u.s. companies, as steve and dan are talking about have to become more resilient in this environment. you're seeing that what i don't think investors have seen is impact on margins yet. they have not even come close especially in an environment where you have a deflation tail wind and that's mitigating a lot of these factors >> that truce is a good thing. longer this drags on companies are in the same position where they are battling extra costs and margins are compressed >> truce is a good thing what trump is doing is negotiating back and forthright now and it's in his best interest if he wants to get re-elected next year to get two or three rate cuts and have a trade deal done going into 2020. so he's slow playing this whole thing right now. that's my big yft takeaway >> news alert on apple tim cook spongd in a fiery email to the "wall street journal report" on jony ive's departure.
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>> that's right. so apple ceo tim cook has written this everyone mail to nbc news in response to that "journal" article. it's tough cook saying this story is in his words absurd a lot of the reporting and certainly the conclusions just don't match with reality at a base level it shows an act of understanding about how the design team works and how apple works. it distorts prescription, relations and events the design team is phenomenally talented and projects they are working on will blow you away. he's referring to this article in the "wall street journal" the departure of jony ive. it was a tough article jony ive became distant and frustrated with apple a company more focused on operations than project designs. "journal" stands by its reporting. unusual for cook to come out on this report. he decided to send this email to
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nbc news >> josh, thank you josh lipton in san francisco this raises the concern or unscores the concern that's been going on for some time that apple is losing its sight on innovation, falling behind, not as innovative as it could be >> a lot of investors have got encomfortable with the fact their products will be revolutionary, whether it's the smartphone, ipad, a mac. people want to see that rabbit they pull out of the hat every ten years. a product that will remake the entire industry. so i think that investors, if you're upset about a guy like jony ive not being there is because he's not a part of that next thing and he's been a very important part of the last few that's fine tim cook writes that letter until jony ive comes out and does it who cares. >> right if anything, tim cook has done a phenomenal job in transitioning from a leader that was impossible to follow but until cook's reputation and
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really what i think he has done a fantastic job at apple for is not around design, it's around being a chief financial officer, understanding how to run a company that's now a global company. it seems as if this is a personal thing for tim cook and clearly writing that letter to show that apple's design is a vertically integrated team and doesn't rest on one person it's important to know that apple is the one creating the design >> they haven't created any new designs in years iphone was the last big prugt they had and an ipad >> the watch >> they still don't have a touch screen laptop. that blows my mine everybody else has touch screen laptop come on, get with it plus, there are now -- they are starting to shift over to services base company anyways. that should be the main focus. >> coming up, one trader bet the group will short out
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we got details more "fast money" after this ♪ ♪♪ ♪♪ ♪♪
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welcome back to "fast money" we've been talk about trade
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truce all hour semiconductors up 3% that's the cherry on top what's been a fantastic few weeks for the group. 15% as a whole micron, nvidia, up double digits >> amd today, volume was one and a half times that of calls interesting trade that caught my eye shortly after noon today when the stock was trading 31.31. a buoy of 10,000 of the august 2nd puts that covers their earnings announcement that should come in the last week of july. but here's thing here's a stock that's massively outperformed up 70% up almost 100% from it's 52 week lows while a lot of name that we know and we talk about quite frequently have underperformed the broad market, amd has
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outperformed much smaller market cap than some others, intel and nvidia this chart has been a really nice stair step. holding that uptrend from the december lows here, the sentiment has been very positive with we know they have a lead on some chesapeake with intel releasing some new ones. by the same token bad press last week in the "wall street journal" again getting blasted by their ceo saying how they've been very cooperative with organizations or companies in china that are cozy with the chinese military this thing, obviously, looks kind of poised to go here despite a trader buying those puts this is the 20 year chart. you can see it's a very volatile name some massive moves up and lower. lastly, let just go to the etf that tracks the semiconductor group. this is how this thing opened.
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the whole day going down while it closed up 3% it closed about 2.5% from those highs. looked like traders were kind of anticipating some sort of news that would gap this thing up this is just the chart year-to-date of the smh. obviously it had a pretty nice decline here it's come back about 20% but this is really like what i think you want to focus on near term as you look at the semiconductor group as we go into earnings. just a few weeks ago we had this disappointing earnings report. last week micron had decent results. basically calling possibly a bottom in the second half of the year this will continue to be a battle ground group until we have some definitive color on trade with china and obviously global growth. >> mark, you said you like tech because it's cyclicals do you think semis >> nvidia you get best of breed exposure to the highest growth
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end markets i want to be a part of from autonomous vehicles, ai, data center, gaming. they had some problems they had some issues with regards to crypto exposure that they cleaned out at this point the risk/reward profile looks good >> i'll take the other side. i'll be a bear on micron deram is responsible for over 60% of their revenue stream. i haven't seen anything constructive happening with deram other than it's flat lined. full show, friday the day ter july 4th, 5:30 p.m., "options action" up next final trade. for your heart...
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time for the final trade >> atlanta makes carbonated drinks coca-cola. >> constellation brands one of the few staples we can get behind doing a great job innovating >> t.j.maxx. tjx. >> this sugar water thing. anti-millennial trade. on the wrong side of history
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>> who cares about that? >> plastics is not good. >> i'm a seller of the smh 113 i'm still selling. my mission is simple, to make you money i'm here to level the playing field for all investors. there's always a bull market somewhere and i promise to help you find it. "mad money" starts now hey, i'm cramer. welcome to "mad money. welcome to cramerica other people want to make friends, just trying to make ya some money call me or tweet me @jimcramer the president negotiate as seize fire with china. the average explodes higher and give uch


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