Stock market at the moment: S&P 500, Nasdaq notch immense gains as Tesla kicks off ‘Gorgeous 7’ earnings

hello and welcome to Market domination I'm Julie Heyman jar blicker in for Josh Lipton today live from our New York City headquarters we are giving you the ultimate investing Playbook to help tune out the noise to make the Right Moves for your money and here's your headline Blitz getting you up to speed 1 hour.

Before the closing bell rings on Wall Street our pricing is held up um very strong uh across the board uh we saw uh average transaction pric is essentially flat and while incentives have ticked a little bit higher we've actually seen uh pricing improve uh April month to date so far so um really a lot of momentum.

That's fueled by the great products that we're producing and the strong customer demand for them double digigit Revenue growth double digit operating profit growth beat earnings expectations it it it's an awesome story and the company's really benefiting from uh some Tailwinds in the industry it's a.

Good time right now for GE Aerospace and it was a good time for GE uh to focus on just that business investors are going to want to to see how this emerging technology is going to fold into not just the tech sector but other sectors as well um it's going to be something that's a longer term theme and investors are going to.

Want to know how these companies are going to fold that in we've got one hour to go until the market close so let's take a look at the major averages sponsored by tasty trade we've got the rally continuing here today the Dow right now up about 235 points 2/3 of 1% the S&P up better than 1% and setting up for its biggest.

Two-day gain since February the NASDAQ though is the leader today it's up by 1.6 6% so earnings are a part of the story today but also a part of the story is what's going on in the bond market because there we see a little bit of a relief on yields not a big move downward but there was a record setting in terms of size to your auction today that Drew.

A better than estimated demand and so that demand pushing prices up across the yield curve and pushing yields down a little bit that is mainly benefiting what we're seeing in big Tech that's something we've seen right also we know big Tech sold off especially sharply last week so it is coming back today so the two best performing sectors.

Communication Services as well as technology consumer discretionary also playing their materials though uh in the lagging position and if you look at the NASDAQ 100 you see a lot of green here on this screen as a lot of these big cap stocks and tech stocks generally bounce back from some of the losses that we had last week Nvidia up 3.3% alphabet.

Microsoft Apple Amazon meta all of them are trading higher today and of course we are awaiting a lot of earnings from these large cap tech companies as well to see where things are going to go from here Jared that's right Julie and we're an hour away from Tesla's first quarter earnings report comes at a crucial time for the company with shares trading near.

52e lows as investor sentiment and EV demand it slides and with more on this and what to expect we're joined by PRI super Manan thank you for joining us here all right 1 hour to go uh we're hoping it's on time f cross here but what should we expect yeah you know so Top Line here right adjusted EPS 52 cents a share and then Topline Revenue.

Sorry sorry sorry EPS adjusted EPS bottom line 52 cents a share Topline revenue of 22.3 one billion got I got ahead of myself there uh that would be the uh the first Revenue decline in four years for Tesla uh also looking at one and a half billion in operating profit a 40% slide from a year ago so you mentioned that possibly demand issues.

Demand concerns there might see that in the r figures um all these cost cutting all these different initiatives there might might see that in the profitability coming down cash flow kind of coming down concerns there for investors we saw the earnings I'm sorry the Q and deliveries Miss uh with the not only demand I'm not sorry not only.

For um deliveries down but production high and that there's a big kind of Swing there in terms of the buildup and inventory another concern of a possible demand issue as well we seeing that those inventories pile up uh last thing product road map are we going to hear more about that that mod model 2 vehicle is it is it truly dead is it just on.

Hiatus is it is it going to come back is it just something that Elon mus no longer wants to do and focus more on Robo taxis which is a more of a concern for are you willing to wait till how many X number of years for those vehicles to come out and also be profitable so just to put things in context though for in terms of whether.

We're going to learn more on that what do Tesla's earnings calls tend to be like does he tend to address that kind of stuff typically they'll say we don't talk about future products in our earnings calls but because of the fact that he did tweet out that the robot taxi is going to be supposedly seen or or or launched or revealed on August 8th.

I think he perhaps will owe investors and and obviously analysts some more detail on that potentially what are we going to see is it going to be a drawing is it going to be an actual car we'll see what he says it could be could it's a drawing be design sketch for that it could be um now in contrast to Tesla which as we know has not set up well for.

The earnings in terms of how the stock is doing General M actually came out with a pretty decent report today yeah yeah I mean look boosting their guidance here strong profit strong decent Revenue here uh for the for q1 coming off that Q4 where they were impacted by UAW strikes and things like that so GM sort of on a roll here some analysts had.

Expected they would boost uh their full year guidance and they did and so that's pretty good for them uh they're seeing that prices sort of stayed the same year-over-year um which is interesting because Revenue went up and sales were kind of flat so that's kind of they're talking about how Fleet Sales are down but but enthusiasm at the retail level.

Is still still pretty high and and you know this is in the face of high rates right the consumers are still wanting their cars we saw a little bit of an inventory pile up GM says that that's not a concern uh they still see their their buyers as wanting to kind of replenish their car supply and things like that so uh looking good so far.

There for GM as of right now thanks Pros looking forward to the numbers from Tesla thanks so much for all of that well stocks are climbing with investors preparing for a fresh wave of big Tech earning highlighted by Tesla later today the EV maker will set the bar for more Mega cap stocks this week though some suspect the momentum might be fading for.

More on earnings and the best ways to be positioned let's welcome in Phil blancato Chief Market strategist at OIC and chief executive officer at lenberg Asset Management thanks so much for being here so we were just talking about Tesla but more broadly of course we saw the slump in the so-called magnificent 7 or five or two or however you're cting.

Them these days big cap Tech got hit where do you think we go from here and how are we set up going into some of these companies earnings it's interesting if you went kind of old school did argue today was an offensive play for Market versus a defensive play last week but I would argue in the other side of this when.

Things get rough like I think the second quarter is gonna be a pretty tough quarter for a lot of reasons slower earnings even though so far they've been fine but politics geopolitics all these things are going to make this quarter hard tradition a tough quarter I think sometimes we forget the mag s are very defensive Microsoft in of itself Makes.

Three and half billion dollars on cash alone with 150 billion in cash the same for Apple the same for a few of the other mag sevens that they make so much on Cash add that their revenues are exceptional think about the explosion in nvidia's Revenue tells you these companies not only are the leaders of the marketplace but are the ones who act.

The most defensive and the market realized that today and that's why you're getting a reflective Bounce from it it's really a a a normal trade at a time of volatility pivot to your best names Phil could you dive into a little bit more detail on some of these headwinds that you're expecting in the second quarter here as you knowe we're.

Early on here but we are in the midst of the busiest earnings week of the calendar so what should be we beware uh what should be aware of as we head into this and where do we put our assets as a result of these beliefs so I'm gonna argue that most of your investors on this already own those big mag seven names and while if you say say it to say.

And I would say if you if you have money there and you haven't taken any profits especially a little bounce like this I I do have moving some of that money away in the traditionally more defensive sector why I want to see you earn a dividend I think the energy sector is really under priced the financials are really come back and quite strong I've.

Hung in here real well so the other parts of the market that have better valuations are going to get you through the next two quarters the next two quarters are difficult because we are seeing a gradual slowdown in the labor market for example you look at the number of open jobs versus the number of job people looking that numbers.

Continuing to narrow you look at things like flash PMI stage why the 10 years sold off a little bit there's some weaknesses again in manufacturing even in Services you're starting to see this concern around earnings every company going to meet expectations if they do it's still only 3% so when you look at the value of stocks that price provided.

By how much they're earning it's still too expensive with three three to four points above historical averages so there's you got to have a lot of believability when you're going into traditionally very difficult months in the market April's usually the best month this year was the worst followed by the months to come remember August.

And September are really challenging months mixed in all the geopolitics we're dealing plus an election plus a Slowdown in earnings which we expect going through this quarter into next and suddenly the Market's going to trade very sideways how do you defend yourself earn a dividend get paid the way to round but don't sell out of the mag.

Sevens you want balance right now and that's why I suggest your investors go if you only been in Gross stocks and you've made a bunch of money it's okay take a little profit here and pivot to where you get better valuations and a better dividend it's interesting Phill you haven't talked that much about rates and where rates are going is this sort.

Of a rate a NOC view in terms of when we're going to get Cuts how many Cuts we're going to get Etc so I'm in a camp that there's only one cut this year if not it's probably zero but I'm gonna be a bit provocative for you what I want your folks to do is I actually think a balanced portfolio is the winner this year and the reason why.

I do expect a rally in bonds when we get this expectation of the FED is just finally going to get around to it whether it's one cut or no Cuts but at least talking about it that fourth quarter of the year is going to be a gigantic quarter for the bond market like last year I toly call this the Yogi Bear Market it stays LEL all over again.

A good first couple of months a very difficult summer a rant into the year especially in the bond market because remember the yields cooling off a bit as inflation eventually cools off it's not quite there yet we still got a little bit of ways to go you'll get a significant rally in the bond market so I would tell your investors don't be.

Afraid to go buy bonds here and I would tell you to put 25% on the short end of the curve 50 in the belly of the curve of the middle and 25% long and as we go through the year start to shift to the long end of the curve go out 10 years Plus in in bonds why because not only do you get tremendous price appreciation but you still got a pretty wonderful.

Yield there a great opportunity in the bond market besides being balanced in your Equity portfolio pH we we got time for one more just want to stick with the FED here for a second what if the inflation data starts ticking to the upside and we've seen some of the the three month some of the six-month and even the yearly uh comps now inflect to.

The upside including super Core X housing just wondering what is the O what are the odds here that we don't even discuss a rate cut potentially a month two months from now but we're thinking about rate raises because of that inflation data is that on your radar at all it is but that's exactly I want to describe it as 25 50 25 or even.

50 25 25 meaning where you place your bet you don't need to go too out too far and take risk yet but let's not forget if you're earning four to five% depending on where you make your bond bet you're gonna make up for any hurt you get in Rising rates remember as rates go down your prices go up but as rates go up your prices go down so my.

Point is even if rates go up a bit because you're right we don't get there we got to go another quarter point higher I don't think you're going to feel it really significantly look at this year the Barkley zag is only down about 2% two and a half percent on the year and yet we've had a move from call it 375 to 4% really since the end of the.

Year and December forward so we've already felt a significant move higher in rates really hasn't had a impact on prices why because you're getting that wonderful yield so to your point it could happen we're not there yet but but eventually the FED is going to get there why because they're overweight the credit card debt the overweighting the.

Auto loans what's happening in the housing market and most importantly corporate earnings will suffer once you have this debt wall this number of corporate bonds that are going to start to mature this year and into next year mature at a higher rate that'll put pressure on earnings that puts pressure on the labor market eventually the fed's.

Going to get their way you're going to see consumers get tired of spending more corporations get tired of having to pay up more and to protect earnings and how they do that is they cut expenses by laying people off So eventually the FED will get their way it's just taking longer than we expected that's why I think you'll talk about it in November.

Maybe get a a first cut if I'm right the inflation slowly cools down here and we go into next year if I'm wrong you're still going to be okay by having a longer bond duration and winning eventually on that price appreciation remember the a or the tol the 20-year Bond index B your bond ETF was up 20% in the last two months of the year I really.

Like that trade if you want to take a little risk on interest rates here Phil lots of stuff to chew on really appreciate it thank you thank you we're just getting started here on Market domination coming up shares of Roblox getting a boost today following an upgrade at JP Morgan we will be checking on that stock as well as other trending.

Tickers on the other side plus the FTC has moved to block the luxury fashion tie up between tapestry and Capri Holdings we'll be joined by a fashion veteran later in the hour to break down the deal and the latest surrounding the luxury industry plus earning seasons in full swing we'll get you all the numbers from the likes of Tesla Visa Mattel and.

More stay tuned more Market domination coming right up n.

IBM reportedly nearing a deal to acquire Cloud software provider Hashi Corp that's according to the Wall Street Journal the Takeover of Hashi Corp.

Reportedly could come together in the coming days and Julie this is a a software company uh that helps I guess companies build up their Cloud infrastructure I wasn't familiar with them if we can go to the Wi-Fi interactive I'll just chart it real quickly because this is a company which listed it looks like they came to Market.

As a public company at an unfortunate time this is the very beginning of the 2022 bare market so big slump there and just kind of finding their footing maybe as they consolidate at the lower end of this range for IBM here's a chart that goes back to the 1960s that's a pretty longterm chart here's a 20year chart but you can see this is a very very very.

Long forming potential Cup in handle but it would probably take another two years for this to complete IBM is just a very slow moving stock it's a legacy stock um but it's just always funny to me how these patterns they hold whether it's intraday or on a chart back to the 1960s yeah it's a legacy stock it's also a very acquisitive company right it has I.

Mean it is a a huge company right of over $150 billion do in market cap so the Hashi Corp deal for what around before this story came out the market cap was just under 5 billion right so you know it's not a huge deal in IBM terms but this is it's made a lot of Acquisitions to sort of build it up into the IBM that we see today so we don't.

Know if this one is actually happening but the stock at least of Hashi Corp is behaving as yes lifting off to lower bounds yes all right let's talk about our call of the day here JP Morgan upgrading Roblox to overweight from neutral raising the price Target to $48 from 41 shares of the online gaming platform are indeed higher today uh by.

The way Roblox is going to be reporting its full earnings on May 9th the stock is down about 20% year-to date coming into this and of course that's part of the reason why um the JP Morgan folks like roblo they think it has been underappreciated here and they said right now you've gotten a compelling entry point for the company because it's.

Growing bookings by 20% it's exiting a heavy in investment cycle and it's ramping two new revenue streams in terms of advertising and commerce there's been a lot of yeah there's been a lot of concern about Roblox sort of turning over its fan base right that they're going elsewhere that's the debate where well that's also probably why they don't.

Want to monetize too quickly because turns off users um but there's there are some comments here from JP Morgan regarding that there's a significant monetization opportunity for Roblox uh we're expecting developers to embrace advertising given the revenue share opportunity as well as 80% of ours that are currently not monetized so um it.

Doesn't actually give the percentage that are not monetized but just seems like a little bit we expect this support sustaining uh sustain 20% plus bookings growth which combined with roadblocks coming out of a heavy investment cycle so that's planning for the future should result in free CL free cash flow FCF compounding at 40% plus through 2027 40%.

Plus is going to compound really quickly if all this investment in their company uh works out as planned you know that's something to hope for the future let me just chart it real quickly if we can go to the Wi-Fi interactive I have since their IPO I was just charting another company hashy Corp that 2022 bar Market took a lot of the wind out of sales in.

Roadblocks here but you can see it's just been treading water for the last couple years yes it has after it had its direct listing a few years ago yes well the Federal Trade Commission is moving to block the luxury fashioned tie-up between tapestry and Capri Holdings the FTC says the deal would give tapestry a dominant share of what it calls the.

Accessible luxury handbag Market former lvmh chairman of North America Pauline Brown is joining us now to discuss that and more of what's going on in the industry what do you make of this um you know of this objection to this particular deal Pauline well I was surprised uh that it was blocked on that front um I was.

Surprised number one because we've never really seen this at least in my career in fashion um fashion is so broadly defined and what they're calling aspirational luxury is sort of Il defined um if you look at competitors like lvmh where I worked or caring or richmont I mean they're consolidators much more.

Aggressively than these two companies uh they're just not us-based so I was surprised uh I was surprised also i' say the closest comparable would be some of the rollup we've seen in in a department store like Macy's and to me that's a much more aggressive example the last reason I guess I was surprised is the argument that was made by Lena Khan was.

Not one that was around protection of the consumer and the pricing but more around employees uh that this would really put a lock on um their hiring power or their um negotiating power to be part of the industry Pauline I I also find this especially interesting at a time when it feels like that this um industry is sort of more wide open than.

It used to be I mean just speaking anecdotally as someone on social media as many of us are you get bombarded by ads for just this category this sort of EX well maybe that maybe I'm telling on myself by saying this but you know you get a lot of ads for startups for brands that that have a bigger reach do you think that those kinds of brands do face.

Do present more of a competitive threat to a tapestry Capri than they used to look I think most of these brands are right now just trying to survive uh fashion at the luxury end in particular is uh is a very unforgiving business uh there are not too many I can think of where 100% of your product line turns over every few months um and economies.

Of scale do play in in a way that can be very very hard for these upstarts I think the advantage that many of them that you're referencing may have is that they can get to the customer directly they don't have to go through wholesale accounts which can be prohibitively expensive they don't have to open their own store the way they did in decades.

Past so there more there's more access to the market but there's also a lot more noise in the market and there's a lot more uh I would say uh demand from the customer base customers are very difficult uh when it comes to selling fashion uh even when they love a brand they're quick to move on to the next thing yes and their tastes have changed.

Considerably over the years especially over the pandemic just wondering uh could you spot could you tell us of any Trends you've noticed and some of the companies perhaps that have been able to capitalize capitalize on these Trends and maybe just outline who's missing the boat and why for instance well um I I focus mostly on the.

Um on the luxury side of the Market um and I would say uh it had an unprecedented uh growth wave from I would say from 2008 really through the pandemic above and beyond what anyone would have expected and it is finally catching up so if you um may have noticed today caring came out um had a really really weak quarter and actually.

Was uh cautioning investors that its profits uh for the first half will be down 40 to 40 5% so I would say with with regards to that segment uh we're seeing that the parties have coming to an end doesn't mean it's going to crash there's still a market for luxury goods and luxury fashion it just means that it's um I.

Think it's very saturated and to answer your question about Trends I mean one of the trends at the high end of the market that I think is catching up with it is uh price inflation the um cost of um uh many bags by Brands like vuon and Ste and Chanel are 50% up from 5 years ago and that is not a cost of goods issue I guarantee it's just that the there's.

Been a lot of appetite for these Brands and and the appetite's now cooling off Pauline when you say the party is come perhaps coming to an end in certain places would you say that is uh in particular in China it's coming to an end which is something um that karing called out or do you think that globally we're seeing a Slowdown in some demand.

Well it's most acute in China and you know this is really a business where China catches a cold and we're all sniffling but us is soft too us is not um you know not not showing nearly as much uh extreme in its its tempered approach um but but I would say here where I'm seeing a pullback is more resistant to the pricing uh that even uh.

Ultra affluent consumers are starting to say you know what it's just not worth it I think in China you have some bigger macro issues that you know were inevitable I mean it could not have kept growing at the size that it is and now the level of competitiveness that it is it could not have kept growing as it has the last few.

Years um but I think everyone deep down probably wanted it to continue for a few more years all right we have to leave it there really appreciate you joining us today Pauline Brown thank you good to see you and coming up the FDA is approving immunity bio's new combination therapy to treat a type of bladder canc.

Cancer and the shares are soaring today company's executive chairman joins the show on the other side stay tuned more Market domination still to come.

now the FDA is approving immunity bios new.

Combination therapy to treat a type of bladder cancer this is the first product approval by a Heth Authority for the company and for more we're bringing the executive chairman for immunity bio into the program Dr Patrick sun xang and Yahoo finances Angelie camani thank you so much for being here um so talk to me about this drug about your expectations.

For it and how soon you're going to be able to get it to patients well the excitement about us for this drug I think it's the Next Generation immunotherapy our expectations is that you know um as you know about K TR and Neo the checkin Inhibitors have made a Major Impact but unfortunately the.

Patients still fail after that and this drug is the first drug as far as I know that activates the natural killer cell that talks to the the te- cell and generates complete remission that is completely durable at this point for 47 months and longer Patrick unel here really good to talk to you again I know that this has.

Been quite a road for the company you had to go back and forth with the FDA a uh last year regarding some manufacturing issues talk to me about now that you've got this approval in hand what that really means for the company sort of financially and and how you anticipate this is going to help the bottom line what is the addressable.

Market here well what's exciting as you know unfortunately we we're not manufacturing this product ourselves we're using a contract manufacturer but we solved that problem and um what's exciting is that this is a backbone We Believe to not only BCG but to checkpoint Inhibitors and since 2017 we've initiated trials.

Across multiple tumor types the concept here is rather uh completely different in the sense that the natural killer cell in your body addresses all cancer types regardless of the of the anatomy so we've now in Phase 2 and and completed some trials in Lung Care cancer and we Face twos in triple negative breast cancer mercal cell.

Cancer pancreatic cancer head and neck cancer and you begin to sort of see by us getting this first approval for bladder cancer which itself is a huge unmet need the opportunity to use this as a fundamental platform across all tumor types in which we are in clinical trials um and we'll be holding a conference call on Friday to announce uh.

The the next indication for which we really have a meeting with the agent Patrick uh certainly it sounds exciting from medical perspective again though I want to sort of reiterate what what un asked which is financially what this means for the company I think investors would I mean certainly they're bidding up the shares of the company today but I.

Think we're trying to get our arms around what this means I mean when you got the first rejection for this drug there were questions being raised about immunity bios cash position so can you confirm that you're now on solid position on that front and where you're going from here well what what we did when that.

Happened was I personally invested uh together with our other companies over $400 million at that point in time so that we would have a firm standing and then oing made a non-dilutive investment and again we will announce on Friday yet another hundred million is coming in U in a non-dilutive way so no the the balance sheet is very strong and.

What's important is that we believe we will have commercial launch available drug by May so this will put us not only a strong financial footing uh but as I said by us being the the Next Generation platform um K truda has $30 billion in Revenue but the patent life of that going off by 2028 this is now putting us in the.

Position to be the company that's going to take uh all checkpoints and put it into this next Generation so this first approval is fundamental because all the issues regarding manufacturing they been settled the clinical data is very strong and that's why last year we made a commitment of 400 million oing put in 300 million and so the company's.

Completely um stable in terms of cash capabilities copy that um I would like to switch gears and ask you about one of your other hats that you've and that's his owner of the Los Angeles Times um the paper has had a number of layoffs that was were announced earlier this year how do you make money in the journalism business right now in.

Particular in the newspaper business well I think we just have to be honest that the platforms of usurping the hard work of reporters taking it for free and utilizing it and actually usurping all the ad money and if you look at Google then ad Revenue what 130 billion in minutes or half a day they make more ad Revenue than the entire LA.

Times so that's not a sustainable um system if we really want to protect democracy if we really want freedom of the press we really want uh organizations with Integrity or talk truth to power so you're right it is a challenge Australia and Canada sorted out that challenge where they asked and forced these platforms to pay a fair use.

It's not that we don't want we want the platforms to use it but really to fairly compensate the hardworking journalists so that's how we need to sort of sort this through but we committed I'm committed um um to actually support the LA Times and we'll be coming out in fact this week I'll be announcing a whole new uh publishing organization within the.

Ear times called ear time publishing the thing called ear time dream our food festival Book Festival viig part of the last weekend 150,000 people attended in Los Angeles and we went live um it was one of the experiments was to test and there was a live um feed throughout at Book Festival so we have to actually find innovative.

Ways to become a media platform not just a newspaper well I I hope we can continue this conversation about all of this soon thank you so much Dr Patrick Sun Chong and are underly kamani thank you both you're welcome thanks for having me thank you and checking in on the shares of GE.

Aerospace the company reported its first quarterly results since becoming an independent company following the spin-off from General Electric shares AR Rising after the Aerospace developer raised its 2024 forecast and Julie I was just looking at this uh stock on the Wi-Fi interactive I think it was uh interesting here let's see if I can find.

This um GE has had quite the transformation and it's recently come up on a number of my scans here just because of the strength now this is a Max chart what you see here and this is another chart that goes back to the 1960s but uh what we have here is a series of lower highs and lower lows but the trend just reversed and this is a.

Multi-decade trend so but but but does it still apply if it's a different company now well you know this go I don't know I don't know enough about charting okay that's a good Phil opical question because sometimes companies do m&a and they just inherit another company's price history people people trade off of charts so there somewhat.

Self-fulfilling but a valid point you know Jack Welch's GE was Far Cry from what we're seeing today so uh but on that on that front though I would just say that the uh the runup here that's finally changed the trend has just been a a big momentum Surge and so it probably has uh uh probably has a ways to go although I'd expect some backing.

And filling well I mean it sounds like that most analysts said that the basically that GE Aerospace is off to a better start for this year than had been anticipated the company said it's going to generate more than 5 billion dollars worth of free cash flow this year remember yes free cash flow is that metric a GE that has always been an.

Important one and I guess it's still important now that it's a GE for years Aerospace exactly um also just looking ahead GE vnova which is the renewable energy spin-off from GE is going to report its numbers on April 25th yeah and I just had had that up on the Wi-Fi interactive real quick ticker gev is now positive 3 and half% in the green after.

Falling in the red after its debut there Julie yes let's talk about one more stock that we are watching that is Kimberly Clark those shares Rising after beat on the top and bottom line for the first quarter it also posted upbeat guidance for the full year here um and basically analysts pointing to product volume trends that are better than had.

Been anticipated remember kimly Clark makes um products for your house yeah Staples Staples there you go it's a consumer staples company that's what the word I was looking for yeah what I found interesting here um a couple of a couple of notes Here have picked up on hyperinflation talk and they actually have explosure because um they supply.

Products in emerging markets and developing markets and here's bernsteen saying that the Big Beat on organic sales growth was supported by the hyperinflation and Emerging Markets that's a that's a change from it's been a detractor in past but I guess it can go both ways however history tells us that these periods of gross margin.

Strength on the back of commodity cost Cycles tend to be shortlived um and we see no we see no obvious reason to believe that it's different this time so a little bit of Doubt there interesting well but it's interesting that it is being backed up by volumes at the same time that they're benefiting from price because that was the thing that was sort.

Of missing for a lot of these companies over the past couple of years as prices were going up that's where all the profit was coming from and the sales were coming from but volumes were kind of lagging but it seems to be now Kimberly Clark's volumes are picking up at least in these developing markets yes all right rate cut expectations just.

Aren't what they used to be after three straight months of unexpectedly hot inflation readings several banks have scaled back their forecast for interest rate Cuts in recent commentary from fed officials has supported the idea that policy adjustments they could become later in the year if at all now economists at City Group are holding.

Their call for Ray cuts to come as early as June or July joining us now to discuss City Economist Veronica Clark and Veronica thank you for joining us here today uh you've probably been asked this question many times but we're here to discuss it again you're standing by your call um just explain it for us please yeah yeah we have been asked that.

Question many times of course so I think we we maybe are some of the last people expecting that the FED will be cutting um we have a base case for June still it very well could be July um but I think the the fundamental difference for us is that you we really do see this fed as having a more doish reaction function um it's not that we see some you know.

Magical slowing in the inflation data if anything we think inflation is pretty sticky um but we think this is a Fed that is looking at some of this you know labor market data even survey data like we had this morning the the PMI services employment number um and really getting worried that you know we might be entering a you know a weaker labor.

Market and really wants to prevent that so at the same time what we seem to have heard from JP palal most recently is that the Fed was sort of willing to rate to wait or is that not how you took his commentary no I mean I I think the you know most fed officials are are certainly paying lip service to this idea that you know maybe we don't have.

Enough confidence yet you know certainly the the March data you know just as strong as we had in February isn't giving them for their confidence um and if that is the the trend you know if we did have you know stronger consistently stronger inflation data then you would have to wait longer um but I think the the bar for what the FED will consider.

You know more easing in inflation is is relatively low and it was actually a bit interesting to hear that that fed officials expect March core pce inflation on Friday um to be at 2.8% year on year that's the same as it was in in February um but that's actually higher than what we're forecasting that's what you know higher than a lot.

Of other forecasts and and they might be delivered a downside surprise on on Friday so that alone might be able to give them a bit more confidence that year on year inflation is coming down inflation is is slowing a bit more that's interesting and we'll keep an eye out for that on Friday just thinking about the two sides of the fedcoin we.

Talked about inflation you also talked about the labor market and a couple of cracks that you might be seeing there can you go into some detail and and tell us what we should be aware of and maybe alerting alert for in the labor market if there are in fact some of these cracks appearing yeah yeah absolutely I mean it is still true that of course you.

Know headline job growth payrolls are running very strong um we really don't see the signs of of big layoffs yet initial jobless claims which we get every Thursday are still very low um but we're definitely seeing indications that businesses are pulling back on hiring um we've seen that in survey data um we've seen that in the hiring rate in the jolt.

Survey we'll get that next week um and so it is true that that hiring is really pulled back um and and markets today are reacting to you know a weaker um Services PMI you know measure for employment um and so all these signs that hiring are is pulling back that that could result in some weaker you know headline job growth you know and.

Not not too distant future you know Q2 you really are expecting to hire a bunch of people um and seasonal adjustment you know we know there's been issues with seasonal adjustment we might be in for a weeker payroll print at some upcoming month and what about the pce report on Friday what are you kind of expecting there yeah I mean we have most of the.

Components of of pce inflation um from CPI and N PPI um we're expecting a three month on month it's a a0 26 unrounded that's the same kind of increase monthly increase that we saw in February um but really is that year- on-year reading I think that's most important um the FED is expecting that year- on-year inflation for core PC is is flat at 2.8%.

We're expecting it comes down to 2.7 that's where the consensus is also um if that's true then then maybe for fed officials that looks like a bit you know cooler inflation than they were expecting Veronica good to see you thanks so much thank you first quarter earning season is in full swing with plenty of opportunities for investors.

We'll discuss how to play the latest on Market moves next on Market Domin ation.

sh now with earning season in full swing we're taking a look at the sectors and names that provide opportunities for investors.

In the Yahoo finance Playbook with more we're joined by Nicole Webb wealth enhancement group senior vice president and financial adviser alongside Michael Green simplify Asset Management Chief strategist thank you both for being here appreciate it Nicole let's start with you um because it's been an interesting earning season thus far obviously stocks.

Fell last week but we have also not necessarily been seeing companies that beat reward be rewarded this by the same um magnitude that they have been in recent quarters and even companies some companies that beat are getting punished so what do you make of it yeah you know I think it's interesting all of last week we kind of had this thesis among.

Ourselves that you know the market was kind of looking for a new bottom this place where you know we could level set and have upside from here and I would say in some of the action today it looks like we might have found that footing um you know and when we think about kind of Netflix is my favorite story um of last week just the the punishment for forward.

Guidance and some of what they're going to claw back in terms of what they give us um you know starting next year to us it's just all this playing out of where does the earnings growth for the rest of the year come from and we had anticipated a a deceleration from those Mega Tech names in the back half of this year and so kind of below the.

Surface we see this turning the broadening that everybody's talking away about and then some of that relative outperformance from places like the equal weight and P all right Michael just uh your your overview how has earnings proceeded so far where do you expect it to go well I think the biggest surprises that have come out of earnings.

In general have been things like General Motors announcement today that was accompanied by an astonishing buyback where they shrank the quantity of shares by around 17% you know this is in contrast that level of buyback is unprecedented for many of these companies for that to be happening in open markets um and it's just highlight.

That the exceptionally cheap areas of the market as long as there's a little bit of support that's coming in through the interest rates base that really looks like that could be an area of focus now of course if the mega cap names continue to disappoint and I find it somewhat ironic that you know in a in a time period in which we announced this.

Morning we heard announcements this morning that Apple was having its worst quarter in China since 2020 um and we've seen some similar data that comes in to support similar dynamics that we're very focused on the idea of where the earnings for the market is coming from clearly the earnings for the market is coming from cheap stocks that have been.

Buying back their shares and if we can get some of a backdrop in terms of a reduction in interest rates of backing off of the fears of inflation or the potential for the FED to hike there are areas of this Market that are outright cheap um Nicole it's interesting when you're talking about you know the valuation conversation if you will.

Because you me mentioned Netflix for example which is not one the folks with think of as a cheap stock per se um so how are you sort of waiting valuation right now yeah I think this all comes down to um what side of strategy you're on and that really don't mean that as a cop out I think there's a place for being a Trader and there's a place for.

Being an investor and so in you know one of the mandates that we look at most specifically is you know how are we tracking to the S&P key in terms of Are We owning best-in-class management best-in-class business across sector and so this just is a unique opportunity I would say and maybe unique is a bigger word but it's just one of those periods.

Of time where you look at some of these Mega cap companies and they've almost been like your piggy bank and so now you're seeing kind of this shaving off this redistribution broadening of the market you can say this in so many ways but I do think if you're looking at you know your own portfolio and you say I'm underweight in certain sectors then.

Yes Netflix is cheaper to buy today than it was similarly meta would be of the same vein and so it's just you know if you missed it in semis and you were underweight in the last run of Nvidia you were fortunate enough to take some of that opportunity over the last couple of days to shore up your Holdings that's more where we're operating from Michael.

I want to jump back uh you said you mentioned some cheap sectors before and you were also talking about interest rates um could you go specifically what you're thinking there how does your view of the interest rate structure where you see it now where you see it going what does that cause you to think might be an opportunity here well the areas that.

We're seeing strength today areas like Automotive for example when you talk about cheapness I understand that these are cyclicals I understand that we have come through a cycle at this point that many people were concerned about the idea that we could go into a recession but when you see a company like General Motors trading at five times earnings in.

Contrast to some of the larger names obviously trading at much much higher multiples um it sets the stage for them to do the exact same thing that they just did which is to buy back an extraordinary amount of shares we've seen this in Coal companies we're seeing this now in the old Industrials um and despite all the headlines about you know.

The chaos uh caused by a new UAW contract at high levels of of uh compensation increase it really is not slowing these companies down what is slowing these companies down is the level of interest rates and the inability of consumers to finance the products and so if there are solutions to that in the form of lower interest.

Rates or even just relief and a time period of adjustment which people can get used to much higher interest rates then these companies could be well positioned um that's really going to be the key question do we get any interest rate relief that gives consumer a little bit of extra spending power for these companies to continue to buy back the.

Extraordinary shares that they've been buying back and Nicole it sounds to me like well what what is your position on interest rates and where they're going and how much that's factoring into your investment decisions yeah and so I think Michael has made just some great points during this conversation um and to piggy back on something he was just saying you.

Know about the rate of financing a name that we added to one of our strategies fairly recently would be John Deere so of that same vein they also have done some interesting work adding starlink um you know we've seen a lot of Agriculture go to South America where starlink is going to be you know bring internet two combines that you're not going to get.

From 5G networks because they don't exist there and so you know I do think that there's room for some of these companies if we if and when we do get that First Rate cut to us we've been the market as a whole did a really great job of moving from six Cuts priced in to three Cuts priced in with barely a hiccup there's a little bit of this now.

You know churning towards okay what if we get zero to us it's still a little bit early to say that cuts are off the table for this year there has been no doubt in our minds that wealthy individuals right so going back to this bifurcated Market the bifurcated consumer were actually being rewarded by interest rates being as high as they are.

They weren't using debt to finance second third homes flying Delta 1 I mean there's just this this population of people is concentration of wealth that's keeping the economy very stimulated and has not been slowed down by higher rates and so we do believe that the FED wants to make that First Rate cut and at the same time the data over the last three.

Months and some of the data that's come to to light just in the last couple of days you know continues to cause concern for the Slowdown isn't really happening the way that has had been anticipated and yet I still do think there's a lot of sensitivity to who is that consumer because we have to make sure that we don't crush the bottom you know in.

Support in continued support of the top yeah we got to go here but really appreciate you both stopping by Nicole and Michael and coming up it's a closing bell on Wall Street and that means it's almost time for Tesla's latest quarterly earnings we're going to break down those numbers on the other side and get you caught up on everything you need to know.

From today's action stay tuned for Market domination overtime.

w there's the closing bell on Wall Street and now it's Market domination overtime let's get you up to speed on the action from today's session uh as we look at.

What's going on Jared what do we what do we got you got the map up yeah I'll tell you what we got some pretty solid gains here Russell 2000 leading the way 1.61% just a hair above the NASDAQ and then S&P 500 up 1.2% in the Dow the uh lagered here but still up 7/10 of a percent just want to highlight the 10e yield coming down a little bit but it's.

Really just stalled out over the last few days in the bond market not pressuring equities markets guess what got a bit of a rally on our hands and here is a sector breakdown only materials in the red today down about 8/10 of a percent but communication services and Tech where by Far and Away the winners also Industrials healthc.

Care consumer discretionary all of those outperforming all of those up more than 1% just a quick look at the NASDAQ 100 so we can get sense of the mega cap action here check out Nvidia up 3.65% some other chip stocks in the green here and not a whole lot of red uh Julie no not a whole lot of red when it comes to large cap Tech um and that.

Market check sponsored by tasty trade well a strong batch of earnings this morning driving gains on Wall Street for a second straight day for a look at the takeaways of our trading day our own miles udland and Josh Schaefer are here as we await Tesla earnings guys miles let's start with you well I think uh you know when you have an earnings week like.

This you know what's the zag and I think the proper zag is that the most important week of earnings is actually when Nvidia reports in a month but I say what you wrote in the morning brief WR in the morning brief but so it's my only take that I have it's the only thing I've had time to think about in the last 36 hours um but no I think when you look.

At the way that the market acted today where you had kind of just a smattering of news you had plenty of stocks I mean look at Jet Blue down almost 20% today plenty of bad news out there Spotify comes out with marginally positive news that sucks up what 12 14% um it's a little bit overwhelming a lot bit overwhelming I think for like where's.

The macro take in this amount of earnings and that only intensifies starting tonight in a few minutes with Tesla and then certainly when we get into Wednesday and Thursday of this week and I I think ultimately yeah Microsoft is probably Microsoft and meta that's probably the bid if there's going to be like this is.

The macro take but I think the volume of earnings makes it challenging in these moments to know for sure what the reaction is as Jared mentioned rates go down stocks go up so I I think that trade feels to me at least like that's still the predominant you know story in markets and that stuck out to me miles just the move we saw in the tenure Jared.

Highlighted it was sort of a minor move and not necessarily big but what stuck out to me today from that perspective was just the timing that we got it it came right at 9:45 was when we saw the tenure move down 945 is when the S&P pmis came out the pmis came out soft for the first time in a couple months now we know we also measure pmis from the ism.

And that's usually actually followed more closely but I did find that move sort of interesting that it came right as we sort of saw a little bit of weakness in some economic data and that has not necessarily been the trend for the last couple months I think maybe the the flip side of that is you know the markets okay so stocks are up two days.

This week great okay you know everything's good again I'm not sure the Market's in a great place when preliminary S&P pmis are moving the market around that's usually not the kind of data that you want to see catalyzing moves in the market if we're on let's call it firmer footing which it feels right now like investors are.

Looking for some kind of ground to stand on that's a little bit more solid than you know the way we entered um you know trading in April so so Miles you kind of brought up that you feel like the Nvidia earnings week that we're going to get at the end of May right is sort of the most important week that we're going to see and one thing that I thought of off of.

That was it kind of depends on what part of the rally you're talking about right so to me sort of the counter to that take that I thought of was you highlight we're getting a smattering of things and it's hard to kind of take away maybe have a broad take away from this week or next week but isn't that sort of what the the market rally and the broadening.

We were pitched over the last couple months like isn't that where you want to see the earnings and see what's going on and yes Nvidia matters but when you look at sort of what drove the market at least the rally we saw in February March it was kind of the other sectors and so in some ways if we want the broad rally to continue in 24 you'd care a little.

Bit more about some of the other earnings for sure for sure you want to see that but the the story coming out of the first quarter into April was that that rally was not working anymore right you still have this rate sensitivity and I think you know the Nvidia Story the importance of those earnings um and really the importance of the AI trade.

Overall in the market essentially just shows that we are we remain I mean we remain in a narrative driven Market where yes earnings are getting better but most of those earnings still come from not not just magnificent 7 Nvidia specifically like they are literally the most important driver of Runnings by far on a single company basis and so if the.

Broadening thesis is also one driven by earnings well the earnings for the other 493 are going to be down right and they're going to be up if you include in video so you kind of it's like this very weird sort of um you know challenge I think for for strategists and for investors to square so let's get to one other company that's reporting earnings.

Right now thank you guys for talking while we could look at the uh earnings by the way so Tesla coming out and missing um pretty broadly here both on the top and bottom line first quarter adjusted earnings per share from Tesla 45 cents that is versus the 52 cents that were estimated uh the first quarter Revenue at 21.3 billion uh the estimate.

For $22.3 billion however the company said it is going to accelerate the launch of more affordable models so this is the news that the market had been waiting for remember Reuters recently reported that the company was going to be pushing back the release or perhaps even abandoning entirely the release of its more mass Market its cheaper vehicle.

Um Elon Musk had you know sort of tried to push back against that but without a lot of specificity and so did not convince the market and instead said oh in fact we're going to give more details on our Robo taxi project in August and so the market took that to mean the cheaper car isn't coming um I had have to look at the actual letter and what.

Exactly he says here but um the yes please miles miles has a letter all right here you go we have updated our future vehicle lineup to accelerate the launch of new models ahead of our previously communicated start production in the second half of 2025 so to your point Julie not only so it's going to be sooner not only is Elon Musk um you know.

Doubling down on the idea that reporting a couple weeks ago was not accurate with respect to the model 2 or whatever that um you know new product whatever you want to call it uh but that they are going to accelerate that timeline um they go through these new vehicles including more affordable models we utilize aspects of NextGen platform as.

Well aspects of our current platform etc etc last sentence of this section our purpose built robotaxi product will continue to pursue a revolutionary quote unboxed manufacturing strategy so I almost see this as not only are we you know reversing back to no no no don't worry this is about the lower cost vehicles but also maybe softening some.

Of the messaging that it's really the robo taxi event apparently happening in August that will be the next Catalyst for the stock and if we are to take what some analysts had said last week that the notion Tesla was pairing back its aspirations for lower cost models as a thesis changer for the company maybe with stock up 5 six% after hours that.

Puts the original thesis as it were back in play a more comfortable place for investors but so stocks down what 50% in the last several months up 5% today so I you know call hasn't happened we'll see yeah so this is just a the disruption trade it's a a levered bet on the future revenue streams from IP that you know a new business model that really hasn't.

Been seen yet um I don't know if you have any comments on that but that's the way I see it well it's to me that's kind of been the the Tesla Model for as far far as what makes the stock work right is sort of talking about things that are going to come in the future at some point in times and make our business better but maybe aren't necessarily.

Happening tomorrow and we don't have full clarity again we haven't had the call yet I'm sure analysts are going to ask for more clarity on exactly when the vehicles are going to be launched sort of expectations and be able to model around it but it reminds me a little bit of when we started talking about the Cyber truck and people get excited and.

Then it's when does this actually impact the bottom line of the company TBD well when has musk ever said something was going to happen at a certain time and it actually happened at that time I actually don't know the answer to this I don't think investors care right maybe not well they haven't cared until recently.

I mean his track record is not fantastic of meeting deadlines so I wonder if it just is enough that it's going that he says it's going to happen and it doesn't really matter when to your point miles that investors don't care is it I don't know it's the right time to do it right when you talk about GW just the numbers that you highlighted off the top not.

Necessarily impressing anyone maybe it's the right time to just sort of steer the conversation in a different direction or maybe the right time to do it would have been when Reuters came out would that report and actually come out and make a concrete statement yeah and something else I note in here kind of right at the top of their letter um they you know.

Talk about doubling down you know we are investing in future growth including a infrastructure so they're defending their capex spending here um you know which was $2.8 billion in the first quarter uh also talking about the recent job cuts which you know hit um you know just within the last couple of weeks company writing we recently undertook CA.

Cutting exercise to increase operational efficiency and in this environment uh speaking of why 2024 is 2023 companies still get a lot of credit for coming out and saying that we're you know being more efficient or we are looking at additional efficiencies I mean we'll get um you know again I think alphabet's probably the one you're looking at later.

This week along those lines and um obviously stocks been volatile here but now back up on my 7% but he does say the the update talking about the new vehicles may result in achieving less cost reduction than previously expected so they're still committed to cost reduction but it might not be as much as they thought would be before trying to.

Thread that I was going to say I feel like of all the things we've pulled out so far from the from the letter it's been both ways it's been both we're doing this and then doing less of that but we're spending a lot of money we're saving money but not as much money as you thought um and I think that it's a this explains everything about the Tesla.

Story at this point in time which is that it's everything to everybody well you it it has always been everything to everybody but it feels like unlike a lot of stocks when they go down 50% everyone agrees like this thing is broken it doesn't work with Tesla it really only gets murkier as it goes further down because the way the company's history.

Has played out the way the stock has acted over time to our where we started this it has never been true that what the company says or doesn't say is you know necessarily something that you know animates the truest of True Believers yes yes it's true so we'll never sit here and be like I'm sure I know what the Tesla story.

Is the Stock's up 6% you know so that's the answer well guess what we're going to we're going to for now for now it's sub six% it could change we're going to talk more about it guys thank you very much appreciate it joining us now with more on Tesla's quarter is Craig Irwin Roth mkm senior research analyst forget about the corner for quarter for a.

Minute Craig obviously we want to talk about what they're saying about these new vehicles um after that Reuters report did Elon sort of scramble and say well we you know did they abandon the model 2 project and now then then they resurrect resurrected it after that came out what happened so you know I've been talking about the mini car since 2019.

The biggest strategic bungle at Tesla the entire time I've known the company just like more than more than 15 years um was when they actually when they decided to punt on on the launch of the mini car right so what happens when you go into production is you do a Bake Off you do a bake off between different sites to figure out which sites can it.

Give you the best uh ramp trajectory um have the best economics um be well positioned for the associated markets and to me it sounded like Reuters got hold of a group that lost a bake off right so there's a bunch of people in an echo chamber that's relatively small saying the same thing they're not going to cancel the mini car they're committed.

To the mini car that the the engineering has been done for three four years now the question is whether or not they're going to use this super modular approach which uh you know could save them a lot of money they think you know maybe as much as you know a 30 40% reduction in manufacturing costs I doubt it um but they they need to just get them rolling.

And adopt technology over time that's what they're going to do they're doing the right thing they're you know better late than never it's the right thing for the company what do you think we can expect from the call today oh man so they're they're gonna give it they're gonna give it a shot to uh to get us uh excited about Robotics.

And and AI on the call right you know elon's got some explaining to do you know FSD the price was only ever supposed to go up and we got you know 12,000 to 8,000 this last week and I guess subscriptions you know are no longer 200 a month or 100 a month um they're really pushing hard on FSD you know personally I'm I'm a bear but there.

There are people out there that like it we need to see a patch rates go up um and for there to be some elasticity of demand here um I'm kind of skeptical right everybody knows that but they're gonna they're going to do a work hard to to to sell that robotics um you know I don't see how you get this front center in the Tesla story uh you know they're.

Trying um but you know it's all about cars it's about the great technology and the market penetration um the most important thing is the discussion around Thailand um you know I think Thailand is kind of an alternative to India or to you know three million units in in uh in Shanghai which I think was nixed so you know if you can get a China like uh.

Supply chain where you get really low costs and and great manufacturing volumes um you know Thailand could be a big winner for the company they may they may make an effort to sell us on that cybertruck uh yeah I mean a lot of a lot of complaints out there they're probably going to address them head on um and uh they're probably going to sell us on.

This uh Robo taxi um which may or may not need to be called a cyber taxi and and also um let's talk about the the first quarter just for a second here because they did Miss they missed on earnings they missed on Revenue I'm now seeing at least Bloomberg's calcul ation of Automotive gross margin X regulatory credits at.

16.4% which is another um you know narrowing of that Automotive gross margin does it matter if they're saying the mini car is coming well let's let's let's talk about the positive point in there right 16.4 16.4% is what we calculated it at um that actually beat the um the consensus number I have a 158 it actually beat it and I've seen other.

Consensuses that different groups put around that were lower than that so you've got a 60 60 basis point beat um with all these issues around uh you know price cuts and challenges with manufacturing and an outage in ger Germany this is a big deal 60 60 basis point beat on Gross margins is a very good thing they absolutely missed this.

Quarter I mean eight and a half per year-over-year drop in units they need to start growing again uh the mini car is what can allow them that path to grow again um and they need to get there as fast as they can how fast can they get there I mean so so they're out today they're talking about bringing up the release date what kind of I mean this is.

Something I don't know if you heard our conversation before what kind of credibility Does Elon Musk have when it comes to deadlines his track record is not fantastic oh man you pick pick pick a vehicle they've all been late and it's usually not you know three months it's six months to a year to two years I mean.

Robo taxes were promised how many years ago right you can update the soft Ware and uh you know the car will go make money for you at night I mean this is this is a credible a credible Target that they're setting um you know I think when you're willing to put more manual content into assembly um and less uh large automation tooling your costs are.

Going to be higher so you're going to wrap some dollar bills around the first Vehicles which you do anyway um but you can start sooner and learn faster and get things out and get Market excitement going that's top priority for Tesla they need to do that right now I mean if if they could make some by the fourth quarter they should do it it would be.

The right thing for the company Craig anything that you saw in that letter today that is changing your opinion I believe you're at a neutral on the stock anything you heard today that that would change things yeah I'm I'm neutral with an $85 price Target I'm I'm I'm very bearish on the the valuation right I think it should not be valued at a.

Premium to Toyota there's nothing they have that Toyota does not right you know people were looking for a potential adjustment around the uh cyber Tru Outlook um doesn't look like we have that it might happen on the call um I think there have been more challenges there than anyone hoped for um you know this is still a very difficult year for.

Tesla it is a big negative setup you know you will see more margin pressure over the course of the year um you know 6 7% price Cuts just this last uh last weekend is a big deal you know and uh doing a u-turn on India is not smart they did that as well in 2019 19 they should have started then if they'd have actually gone into India in 19 the.

Supply chain would be mature uh and their cost would be great and uh you know they wouldn't be scrambling for an alternative to uh Shanghai so you know there lots of issues uh for them to address at Tesla nothing fundamentally changes the way I'm looking at this I think the consumer is not um open arms for EES right now I think the EVS have.

Got to come down in price um and they've got to be a compelling um a compelling proposition for consumers cheaper cars they get the same mile safer better technology that's the proposition that they're that they're maturing into but we've got more price Cuts ahead to get there hey one last question sorry Craig because somebody just flagged me to an.

Additional headline here that has to do with the cash flow at the company apparently first quarter free cash flow was negative $2.5 billion the consensus were was looking for positive free cash flow of about $650 million what's what's up what's up there yeah so yeah like I'd have to go through that very carefully but to me you know um the.

Facts set consensus uh for uh the quarter was 457,000 units um immediately before the uh the print right so the uh the whisper number was you know 430 420 so they I mean pick your number they missed by you know 35 to 70,000 units that's a lot of money you got to spend um um and the production was there for them to actually make that that that.

457,000 um original consensus forecast so they themselves thought they were looking at a better quarter than than what they posted um and it cost them some money so they're going to have to bleed down inventory um over the next couple quarters again that's why they're putting price Cuts in uh because the consumer is not as strong as they had.

Projected Craig really helpful stuff thank you so much appreciate it thank you well still to come we've got more earnings we'll be talking about the latest numbers from Texas Instruments those shares also higher in the after hour session more Market domination overtime coming up.

.

A now let's get you up to speed on the action from today's trade sponsored by tasty trade uh we're looking at the Dow with gains of about 710 of 1% the S&P 500 up.

About a buck 20 that's 1.2% the NASDAQ the leader of the three up 1.59% and the Russell 200000 outshining them all but just by a little bit up 1.61% Julie let's talk about Texas Instruments the company reporting first quarter numbers beating Topline estimates guidance for the second quarter also coming in better than.

Expected and the shares have been higher in after hours trading now Texas instrument biggest maker of analog semiconductors and has been undergoing something of a slump here this might be a sign that things are improving to some extent if you look at that forecast it says sales in this current quarter are going to be $3.95 billion analysts had.

Been looking for $ 3.78 billion um and the company the midpoint of its earnings per share forecast also leaving it perhaps a little bit of room to beat potentially here um and the company said Revenue in the first quarter was down 16% it what fell to its lowest level since 2020 but that forecast again raising some hopes that a rebound could.

Be coming yeah I'll tell you what I'm looking at the W the long-term chart on the Wi-Fi interactive um here to date this is sideways let's go to two years because remember the AI hype and this is not a a Texas instrument play but I want to make the connection here that this is a stock that has traded sideways for several years in fact you got to go.

Really far out this is a 20-year look and all you see is it's consolidating in a flag here so funny that all right Spotify shares jumping today on better than expected earnings ahead of the open the company turning a profit thanks to a recent focus on efficiency joining us now is Andrew Merck Raymond James Andel and Andrew thank you for.

Joining us here today um you re reiterated your stance on the company and I believe that is an outperform and correct me if I'm wrong your price Target is $335 what's behind your call yeah correct and and thank you for having us on today um you know the the first quarter results for Spotify quite strong this morning and what we're.

Really seeing at the company for the first time that we can really recall is a double focus on not only growing users not only growing the engagement of those users but also profitability and margin benefits this is a a story that's kind of been stuck on the gross margin side for a couple of years and now is actually gaining some significant.

Leverage on the operating income side of things after some headcount reductions and a more companywide focus on being cost conscious so that's really a sea change in how investors are looking at the stock and and how the numbers are flowing through the statements so that's why we still remain positive on the stock and this quarter was another data.

Point in that favor it's so interesting that Spotify the way you frame it is just coming to this I feel like you know at least in techland like everybody got religion a couple of years ago in terms of cost and in terms of that focus on profitability what took Spotify by so long and do you think that this will be sustainable so I think there's there's.

Two things behind this so yes Spotify is very much a tech company but it's also a media company and it does not create its own content it is dependent on content from other creators and other publishing and Industry bodies who own the rights to that content and I think that puts Spotify in a unique position relative to other companies in the tech industry I.

Think what we saw this quarter that gives gives us confidence that there's sustainability behind this gross margin trajectory and not just kind of the oneoff um little adjustments that we've seen in the past is that the reasoning behind the gross margin jump this quarter were things like cost efficiencies on streaming delivery which.

Was a result of Greater revenue from their pricing increases it's better focus on their Marketplace products which are data enabled services that provide um insights for for labels and musicians those things are core parts of the business that can be utilized indefinitely and so that's why we think that the uh the margin Outlook coming.

Out of this quarter is better than we've seen it in the past yeah I happen to be one of the few uh Google uh red music YouTube Red excuse me uh users that uh exist um this is a service that is a competitive Spotify where I'm trying to go with this they recently raised my prices I think they're just being competitive they're kind of matching.

Spotify maybe they were waiting but is the industry these price Cuts seem to be these price hikes seem to be absorbed by the consumer um are there is there room for further price hikes I mean we've seen this play out in streaming on TV where people are are starting to get a little cost conscious here because of all the options admittedly streaming.

Music a little bit different here but I guess the bottom line do these companies still have more pricing power in the market and maybe as a as a day one user of Spotify in the US I I might be the wrong person to ask um in terms of uh the typical user Dynamics but what we would say is that digital music services and Spotify specifically have kind of.

Industry low churn rates when it comes to digital media or Digital entertainment and as a result of that we do think they have pricing power when you compare it to streaming video for instance uh the content between streaming music Services is going to be very similar so once you sign up to a service build your playlists tune the.

Algorithms to know what kind of music that you like your switching costs tend to be relatively high and so you just don't do it and so as a result you tend to lock yourself into a platform and that leads to pricing power and and when we compare Spotify on an absolute basis in terms of dollars to Netflix or or other forms of.

Streaming or Digital entertainment it's still quite attractively priced and at the same time if Spotify isn't going to make me pay more because I don't listen to audiobooks that would be nice too which I guess is part of the the various tiered pricing Andrew thank you very much appreciate your time thank you time now for what to watch Wednesday April.

24th starting off with earnings another big slate on top for tomorrow meta IBM service now they're all reporting after the close meta announcing first quarter earnings after the Bell analysts expecting ad targeting from generative AI to be a focal point of tomorrow's earnings call and we're also getting earnings ahead of the open tomorrow from.

Boeing Hilton and Humana Boeing f facing its share of bad headlines this year and analysts are expecting more bad news for the airplane maker as first quarter deliveries are expected to be affected by continuing expe inspections on multiple Boeing aircraft Ford also reporting tomorrow the automaker announcing first quarter earnings after.

The Bell amid the struggling EV Market analysts expect the company to meet first quarter ebit expectations but they see a declining operating margin in its EV business and finally we're going to get some economic data tomorrow number for durable goods are coming out in the morning economists forecasting that the number to go up giving us some more.

Insight on the broader state of retail sales in other words it's going to be a busy day that'll do it for today's market domination overtime be sure to come back tomorrow for all of your coverage leading up to and after the closing bell but stay tuned we've got more Yahoo Finance on the other side.

n.

new home sales rebounding in March an encouraging sign for the real estate market but for those still looking to place a new place to call home there's a different option on the market to.

Consider the commercial to residential transformation now for more on this let's get to Yahoo finances Danny Romero who is at a recently transformed office to residential space on Water Street in New York Danny you're in my you're in my stomping ground down there in the financial district what's going on Jared welcome to my crib this is a.

One studio bedroom apartment on Water Street in the financial district and the average rent here for this apartment is about $5,000 now this apartment building was in office space and has been converted to 588 apartment units again the average rent is about five grand so there is some opportunity here 38% of this.

Building has been leased out so far but again this building comes with a plethora of amenities including a hot tub a bowling alley a kids room uh and in a gym of course obviously we got to work out a little bit but look New York City bottom line has an affordability problem data from the Department of Housing and preservation and development.

Shows that renters have less than a 1% chance in finding an apartment that that costs under $2400 a month in the city now the median rent right now is about $4,200 as a 20% increase from prepandemic levels in New York though if you want to buy a home and you're considering buying a home the median income that you do need is about.

Uh you need to make is about $150,000 dollar that's an annual income and according to city data 30% of households in New York City own their homes now the income does range within the those households bottom line mayor Eric Adams uh created a a goal to build 500,000 new homes over the next decade but there's been a series of.

Complications obviously a big debate AB uh among State lawmakers going on right now but again this is just one option that that is here in the city this is being this is really helping the inventory front uh Jared so far but again such a nice crib right here I mean and the ameni is great at a price though Danny thanks a lot appreciate it.

Yes well it's not just in New York City affordability remains a pain point for prospective home buyers in many areas High rates creating little opportunity for entrylevel buyers such as Millennials and gen Z the shifting housing landscape lending to a shift in trends among the different Generations here to discuss as part of our weeklong.

Special real estate the new reality we have Dave liner Remax co-founder and author of The Perfect 10 thanks for being here appreciate it D thank you so we just heard uh Danny talking about affordability here in New York City obviously this is an issue in many areas um around the country what are you seeing from this gen Z Millennial cohort.

In terms of whether we are going to see the same level of home ownership that we want St did well currently you're not going to see it housing affordability is a terrible challenge for everybody interest rates have gone up and that uh means a bigger down payment or a higher monthly payment and so with the limited amount of inventory we got a tremendous.

Demand for Real Estate uh real estate prices keep going up you know and I want to talk about some of the trends that you're noticing here with jenzi in particular uh they are shunning College in in small numbers for trade school and just maybe outline some of the benefits there and reasoning why they might doing this and how it fits into your housing.

Uh thesis well there's a couple factors number one we don't have enough of the trades and the trade income has skyrocketed uh and so a lot of times the younger generation is taking a look College the cost uh borrowing money and paying on it for 10 or 20 years uh for maybe a good income when you can get a great income right now in the trade.

I mean there are welders that are making $100,000 a year within 2 or 3 years of trade school so uh practically speaking why go into debt if there are trade jobs that you want to do and you can make just as good of money so does that mean then that maybe the spending power of this generation will actually be a little bit stronger than some of the.

Worst predictions are are saying yeah I think the predictions are wrong the uh um Millennials and the Y Gen especially are much thriftier than any previous generation uh I believe that comes from watching their parents struggle in 2007 and on and all the foreclosures and the things that happened I think it's made them much more frugal about their money.

And so their savings are doing much better than previous generations did well that's impressive I I want to switch uh gears a little bit talk about the National Association of Realtors settlement and the impact that may have for anybody who's buying considering buying or selling a home now it's hard to tell what it will do uh part of the.

Settlement is uh more transparency uh on the part of the realtor part of it is that if a realtor is a a buyer agent and he's representing a buyer he has to have an agreement in writing with a fee structure in writing that has been agreed to by both parties uh over the past decades uh the seller paid most of the commission split it.

Between compan ianes and so the buyer agent was saying basically you're getting my service for free now the buyer agent it does not necessarily have that and the buyer agent's going to have to justify what did I pay you for what you did I mean even though the change is still the exact impact is still sort of TBD with this I mean you just wrote a.

Book called The Perfect 10 I imagine you've been reflecting a little bit on the what you've seen over your career in the industry how do you sort of situate this amongst the other big changes we've seen over the years in the housing market well I think the litigation explosion is certainly going to have an impact on the.

Industry um whether it's going to have a huge impact on uh the cost of buying and selling property nobody knows for sure yet uh the one thing it will do is it is going to start eliminating the massive numbers of low producers and part-timers in the industry Dave we got time for one more here anything uh want to talk to us about give you the floor here well I.

Think the thing is that uh interest rates will come back in line but do bear in Mind Over the 50 years of remix's History the average interest rate 7.78% exploded to 17% back in the early 80s uh the last 15 years are unreal oh well what does what does back in line mean I think you're going to see uh 6% mortgages uh the mortgage rate of the.

Future all right well we'll have to have you back and see if that comes to fruition here appreciate you coming by here Dave thank you all right coming up toy maker and entertainment giant Mattel reports its first quarter results we'll have the numbers for you after this break.

a.

Visa reporting its fiscal SE second quarter numbers the credit card giant reporting better than expected results on the top and bottom lines say shares up about 3% here credit card spending in the US up 6.2% worldwide payments volume up 8% total process transactions up 11% people are still charging it on the car.

They are and in fact payments volume at 3.17 trillion is up 7.4% year-over-year two your point Julie from 3 point the estimate was for 3.2 trillion so they actually didn't quite make it uh but fairly close there payments volume at constant currency you might have said that up 8% the the estimate was right there I don't see a lot of surprises.

Here I will chart the stock briefly on the Wi-Fi interactive uh first here is a 2-year chart and this pretty much goes back uh Visa bottomed with the General Market in October of 2022 you can see up about what is that 35 40% from the low uh net it's up about 31% and by the way extended hours it's up 3% here's the longer term Trend and it's from the.

Lower left to the upper right that is a very steady looking chart and also another another interesting development was this was classified as a tech company recently got classified as a finance company a financial company at least in the GI system which is a global industrial classification system a little bit Arcane but it it determines.

What sectors various companies are in the S&P 500 and how what their comps are so basically the tech multiple they're saying okay no Visa has a financial multiple which is going to be a bit lower yeah um MasterCard by the way I think is also catching a bid I should mention Visa shares up a little more than 5% year to date which is.

Underperformed the market so we'll see if this uh helps them catch up a little bit let's also talk about Mattel it also reported its numbers it's first quarter coming in mixed here um and uh we're watching the shares here as well to see how they're reacting they're up about 3% here the quarterly loss at Mattel at 5 cents a share that's excluding some.

Items analysts have been looking for a loss of 12 cents say that's better than estimated first quarter Revenue fell uh a little bit less than a percent to $ 89.5 million that was short of estimate so uh loss was better than estimated but Revenue was a little bit worse than estimated and you had a comment I think is quite relevant over the break which.

Is you know with all the hype for Barbie we're not seeing that necessarily refle reflected in the current quarter results certainly not beating expectations here's do dolls gross bookings 20 94.5 million but the estimate was for 306 million that's a that's about $10 million difference infant Toler in preschool gross buildings that was light.

At 135 million expectation was for 143 Vehicles beat uh so 297 versus 285 action figures that was light as well so just a number of metrics here yeah Hot Wheels when you say Vehicles we're talking about Hot Wheels okay Hot Wheels yes and apparently um there's a new animated series hot Wheels Let's Race it's one of the few toys I have like 500.

Of those little cars my mother a lot of credit here has save them over the years they take up some space um and yeah maybe I'll break them out in a few de maybe maybe they're coming back here it sounds like so they've got and inan CH who is the CEO of the company said that that helped the hot whe s wheels sales that um that series he also said this.

Year is all about profitability he told Bloomberg that so learning a little bit about toys here yes we are all right coming up the CEO of cannabis infused Beverage Company can joins the show to talk the about the Brand's partnership with barol sports that's next on yahooo finance.

now.

no more hangovers that's what one company is promoting with its cannabis infused beverages one of the fastest growing sectors of the Cannabis industry and today we have one of the champions of the so-called C sober lifestyle co-founder and CEO of can that's two and c and Jake bolock Jake thank you for.

Joining us here today give us an overview um I I understand you have a new partnership with bar stool sports that's relatively new just tell us about your product and what you're doing with it yeah definitely so we make a range of micro do infused THC and CBD products they're really alcohol Alternatives so people are trying to drink less booze um.

They turn to our products and they give you a similar Buzz it's sort of the same strength as a glass of wine or a beer uh but no hangover from alcohol the next day and that's really starting to get into the mainstream so you mentioned Barcelo Sports uh a partnership we just launched with them over the last week and they're really coming to us saying.

Hey we're excited about this category we're seeing what and they came to you they came to us and um you know we've been doing this for a while so we've been at it for 5 years we've grown the business and um people really like the products they like the taste of them and so um you know we're trying to reach a broad set of customers we started the.

Company in Venice Beach in California and that was great and now we're trying to talk to people in Kentucky and Texas and Tennessee and barcel is an amazing platform to do that across their various media properties and so we're partnering with them to really get the word out about can and um and and the way that it can impact your life in a positive way.

So how does the partnership work do they invest in can do they what is what are the terms of the partnership yes so the biggest thing that we're doing is we're advertising on their platform so if you think about bars Sports is um this massive media conom which has all of these really interesting media properties predominantly their podcasts.

And their talent that that you know are on those podcasts um and their social media accounts and then they have social media accounts that even reach into you know various parts of people's lives there's you know barol Duke where I went to college as an example and so there's a lot of touch points to reach customers that we would not otherwise not really.

Get I guess what I'm trying to understand how is it a partnership quote unquote different than you buying advertising with them or like is it is is that all is that what it is or that's predominantly it is but the thing that's unique about this um is they've never done this before with a THC drink so this is the first time that they're.

Coming and saying we're willing to take a bet on this category we're willing to even allow this this is really hard in the industry how big how how big is that leap there um is are there were there legal barriers before were there concerns about that I mean with the banking industry the way it was with the Safe Act hasn't been passed what are.

Some of the details there yeah so it's really really hard to advertise cannabis products as as I'm sure you know um there's marketing restrictions there's restrictions in in all of the states in which we operate have very strict rules think about alcohol but even more restrictive and then you have some of the big digital advertising properties.

Like meta Google that in their terms of service they restrict this type of advertising so we have to be very careful we built this brand on the back of a lot of celebrity investors that had big megaphones people like gwenneth peltro Kate Hudson doing ads for us talking to their followings about it barcel is a similar approach it's.

Finding those big megaphones places where they will actually take the risk and say oh yeah we will work with a THC brand THC drink nonetheless to get the word out it's a growing category um and the sort of alcohol alternative category more broadly is growing a lot how do you stay competitive when there are more more other other choices that are.

Popping up it's really challenging I mean we started in dispensaries where we were competing against other cannabis products that was you know it felt really hard at the time but that was a small box now we're in Total Wine and Spirits which one of the biggest alcohol retailers in the country and we're competing for shelf share against some.

Of the biggest alcohol Brands not just non and are you guys only sold in states where it's recreationally legal or can it be sold nationally now yes so we're available for sale online in a number of states about 30 um we're also available in some states in liquor stores about 10 states and then we do sell in dispensaries with recreational programs.

About four or five um we got just a minute to go what about some of the naysayers saying well this promotes uh not true abstinence because you have alcohol you have the effects of alcohol but then you have also have the potentially addictive product properties of cannabis what do you what do you say to that yeah look this is not vitamins.

Right it's another product which if you drink a lot of it you're going to feel the effects and they intoxicating effects um you know one of these is probably not but but a few of them would be and so this is not swapping out your alcohol for nothing but it is we think a a healthy choice to make to drink a little bit less booze and to drink these.

Instead and and the science really does back that up in in a lot of ways we're learning more about it a lot of the work that's been done the past about smoking this is a product that doesn't require you to smoke it doesn't require you to vape and and those are also you know negative potentially negative Health impacts and so that along with the fact.

That it's only 2 milligrams our High boys have 5 milligrams it's really really low potency and you have to drink the whole thing to get the full dose so there's a lot of things working in our favor to keep people from overc consuming or for having a bad experience Jake real quick what's the long-term plan IPO to sell yourselves to a bigger.

Company what are what are you planning yeah we are seeing incredible consumer demand for for these products and so we're heads down growing the business we don't know how big it can be we just launched in places like Texas and Florida and so those are really big markets and and we're going to learn and and evaluate along the way all right.

Jake thanks for being here appreciate it thank you and that'll do it for today's yaho Finance live be sure to come back tomorrow at 3 p.m. Eastern for all of your coverage leading up to and after the closing though.

E e e

Sharing is caring!