Brian Stewart
Appearances
The Megyn Kelly Show
Petitos Speak Out About New Doc, and "Snow White" Controversies and Baldwins Red Carpet Drama, with Link Lauren and Christian Toto | Ep. 1031
Yeah, all indications are that they were aware of what was going on and immediately took steps to protect Brian rather than look after Gabby or her parents' interests. And it was really unfortunate.
The Megyn Kelly Show
Petitos Speak Out About New Doc, and "Snow White" Controversies and Baldwins Red Carpet Drama, with Link Lauren and Christian Toto | Ep. 1031
Well, that's really why this case is so instructive is because it's so well documented. You can see the injury. You can hear the witness call. You can see how the how the parties are reacting to each other. And you actually get to see the officer's thought process.
The Megyn Kelly Show
Petitos Speak Out About New Doc, and "Snow White" Controversies and Baldwins Red Carpet Drama, with Link Lauren and Christian Toto | Ep. 1031
So they admit that they know that there was an assault, that there is visible injury on both parties and that they had witnesses saying that they had hit her. And so they're aware of that, and they choose not to do further investigation, and they choose not to follow Utah law, which required them to effect an arrest and to separate them.
The Megyn Kelly Show
Petitos Speak Out About New Doc, and "Snow White" Controversies and Baldwins Red Carpet Drama, with Link Lauren and Christian Toto | Ep. 1031
And so while they know that the reason for the law is to protect domestic violence victims from the eventual murder or or worse violence that can come from not intervening in these situations, they didn't appreciate the risk. This officer Pratt said, yeah, that's the law and yeah, that's what it's intended to prevent, but I don't think that will happen here because of my experience and my biases.
The Megyn Kelly Show
Petitos Speak Out About New Doc, and "Snow White" Controversies and Baldwins Red Carpet Drama, with Link Lauren and Christian Toto | Ep. 1031
And so that's really why the lethality assessment protocol that they should have done would have been so important because understanding the law and the situation, they could have asked these questions and appreciated and helped Gabby appreciate the danger that she was in.
The Megyn Kelly Show
Petitos Speak Out About New Doc, and "Snow White" Controversies and Baldwins Red Carpet Drama, with Link Lauren and Christian Toto | Ep. 1031
Right. And that really becomes obvious, the biases that they have. They're clearly identifying with Brian. Even during the stop, they have conversations with Brian saying, yeah, my wife gets crazy too. My wife gets upset too. And so they're identifying with Brian and his situation in dealing with an upset woman. And so they're not seeing it from Gabby's perspective.
The Megyn Kelly Show
Petitos Speak Out About New Doc, and "Snow White" Controversies and Baldwins Red Carpet Drama, with Link Lauren and Christian Toto | Ep. 1031
So part of the training that officers and law enforcement need is not just you know, what are the signs and what is the law, but also to be aware of their own biases and to be aware enough to be able to put themselves in the situation of both of the participants in a domestic violence situation.
The Megyn Kelly Show
Petitos Speak Out About New Doc, and "Snow White" Controversies and Baldwins Red Carpet Drama, with Link Lauren and Christian Toto | Ep. 1031
That's correct. The wrongful death lawsuit was dismissed at the trial court level because of the Governmental Immunity Act. But the Utah Constitution says that the legislature and statute cannot infringe a person's ability to bring a wrongful death lawsuit against or to recover in wrongful death for damages.
The Megyn Kelly Show
Petitos Speak Out About New Doc, and "Snow White" Controversies and Baldwins Red Carpet Drama, with Link Lauren and Christian Toto | Ep. 1031
And so there's a conflict between the Utah Constitution and this governmental immunity statute. And that's the basis of our appeal to the Utah Supreme Court.
The Megyn Kelly Show
Petitos Speak Out About New Doc, and "Snow White" Controversies and Baldwins Red Carpet Drama, with Link Lauren and Christian Toto | Ep. 1031
There was some settlement, but I'll let Joe and Tara speak to that if they'd like.
Wall Street Breakfast
The faster you go down, the sooner you hit bottom
waiting for either the next shoe to drop or the next piece of data to send the market higher, something that's going to give some sort of idea that we've gotten all the selling out of our system. So I would look for the Fed next week as a major catalyst. Unfortunately, there's not a lot of earnings coming out, so there's probably not going to be a good corporate catalyst for the market in general.
Wall Street Breakfast
The faster you go down, the sooner you hit bottom
There might be individual stories that come out, but not something that's going to move the entire market. So you're probably looking to the middle of next week before you see anything concrete. Otherwise, between now and then, we're probably just moving on momentum and just overall sentiment.
Wall Street Breakfast
The faster you go down, the sooner you hit bottom
So Bitcoin's down today, gold's up a little bit, oil's down a little bit. So honestly, that's just sort of on brand for how the market has been lately. Crypto, along with some of the major tech names, has been sort of the big story on the down side. downside as we've been selling off lately.
Wall Street Breakfast
The faster you go down, the sooner you hit bottom
As you and I talked about last week, the Bitcoin situation is kind of interesting in the sense that longer term, if there's going to be a strategic Bitcoin reserve, if there's going to be larger sort of institutional buy-in for that, that provides a floor for Bitcoin and a long-term catalyst to push it forward. But in the near term, it moves like a high risk asset.
Wall Street Breakfast
The faster you go down, the sooner you hit bottom
So you're seeing it being treated like that in the market lately. So it was a big decliner when stocks were down earlier this week and it's continuing, it's moved down. So I think that if you're looking at Bitcoin, you should probably look at it in that light for the near term, just sort of seeing it as a proxy for overall kind of risk sentiment within the market.
Wall Street Breakfast
The faster you go down, the sooner you hit bottom
Great to be here. Glad for the extra chance to talk to everybody.
Wall Street Breakfast
The faster you go down, the sooner you hit bottom
And so if you see that turnaround, that might be a good sign that buyers are starting to step into the higher risk assets.
Wall Street Breakfast
The faster you go down, the sooner you hit bottom
So obviously we started this week with a big sell-off. There were rising inflation concerns. This was stoked over the weekend by some comments Trump made about moving into a transitionary period with the changes that he's making.
Wall Street Breakfast
The faster you go down, the sooner you hit bottom
In his administration, there's rising worry that he's going to kind of shove the market off a cliff by doing severe job cuts in the public space and by putting tariffs into place. So the general idea that Trump is OK with a recession kind of sent people in. into a panic. The market has stabilized since then.
Wall Street Breakfast
The faster you go down, the sooner you hit bottom
I mean, one of the good points about going down quickly is the faster you go down, the sooner you hit bottom. So there's the debate going on about whether we've hit the bottom or whether we've kind of just settled on a ledge somewhere, just sort of waiting for the next step lower.
Wall Street Breakfast
The faster you go down, the sooner you hit bottom
So if we just look at the markets for today, we're not seeing anything dramatic. It's down again, down about 1% on the S&P 500. So there hasn't been a major snapback yet. So there's not a wave of buyers coming back to the market. So there's generally feeling
Wall Street Breakfast
Market getting used to higher rates for longer
But I think if you're an investor, you're kind of looking longer term. impact on consumer impact, on businesses' ability to borrow, things like that. It is definitely something to keep an eye on.
Wall Street Breakfast
Market getting used to higher rates for longer
The impact on individual sectors, I would look to the traditionally interest rate sensitive sectors. So REITs is a good example of a sector that moves in accordance to how interest rates are looking. The home builders and other housing stocks are another indication. If it's becomes more difficult for those companies to book revenue and therefore can affect their bottom line.
Wall Street Breakfast
Market getting used to higher rates for longer
So I would keep an eye on those things. I would keep an eye on the treasury market as well. There's kind of the feeling that the treasury traders are the smartest traders on the financial markets. And so you can kind of get a pretty good idea of what the street thinks generally of the prospects for inflation and other aspects based on the movement. in treasuries.
Wall Street Breakfast
Market getting used to higher rates for longer
And then secondarily, I think it's interesting, another news point this week was Powell appearing in a semiannual testimony on Capitol Hill. Those conversations didn't have a lot to do with inflation. I mean, they had sort of the normal amount, but there was also a lot of conversation just about sort of the intersection of the Fed and the new administration.
Wall Street Breakfast
Market getting used to higher rates for longer
The Trump administration has been much more kind of aggressive in stating its opinions about interest rates, specifically that they should be lower. And I think that it'll be an interesting kind of dance to watch the machinations between a supposedly independent Fed and the White House.
Wall Street Breakfast
Market getting used to higher rates for longer
You had also asked about tariffs, and I think that's something that's making it much murkier when you look into sort of the crystal ball of inflation. You have sort of the normal pressures that the Fed is dealing with in terms of the economic pressure. causes of inflation.
Wall Street Breakfast
Market getting used to higher rates for longer
And then you have this sort of political possibility out there, the extent to which tariffs are going to push prices higher for consumers. And obviously, that's out of the Fed's hands. There's nothing they can't raise interest rates to a point where tariffs go away.
Wall Street Breakfast
Market getting used to higher rates for longer
It's going to be interesting how those play into the Fed's decision making, whether or not they'll kind of ignore it and try and just kind of look at the underlying inflationary pressures, or if, as the White House would like them to do, kind of counteract tariffs by keeping inflation under control. Gold has been rallying to new highs. recently driven by fear of inflation.
Wall Street Breakfast
Market getting used to higher rates for longer
It's generally seen as an inflation hedge. So I think the more that worry pops up, the more you can see people taking positions in gold as kind of a hedge for that. Looking at the bond market, looking at the gold market, I think those will give you indications about where inflation, where the impression is that inflation will be headed.
Wall Street Breakfast
Market getting used to higher rates for longer
Yeah, we're through the jobs data and this was the most recent inflation data. So we're in a bit of a quiet period in terms of actual information. So it won't be into March that we're going to get the big data points that can kind of move expectations. So I think that people should keep an eye on Fed commentary as it bubbles up in various Fed commentators speaking over the next week or so.
Wall Street Breakfast
Market getting used to higher rates for longer
They'll give you an idea of how aggressively hawkish the Fed wants to become. Like I said, right now we're kind of pricing in a rate cut sometime in the summer. So that would be the target. If you're wondering if the Fed is starting to turn extremely concerned about inflation, look for commentary that would push rate cuts past that period into later in the year.
Wall Street Breakfast
Market getting used to higher rates for longer
And also look for people who might be talking down the possibility of any rate cuts this year. In terms of a turning point, kind of a pivot point for inflation expectations, I would keep an eye on if there's ever any commentary starting to bubble up whether the next move should be a rate hike.
Wall Street Breakfast
Market getting used to higher rates for longer
Thanks. Big shoes to fill, but I'm ready.
Wall Street Breakfast
Market getting used to higher rates for longer
Right now, we've kind of talked about things in terms of whether or not there's going to be a cut and when that cut might happen. But at some level of inflationary concern, the tide might turn to worrying about a rate hike as the next move.
Wall Street Breakfast
Market getting used to higher rates for longer
In terms of data and earnings, there's not going to be much to drive trading on Friday. So I think Friday is going to be an extremely vibes driven day. So as an investor, you can kind of learn a little from that. How does the market trade in the absence of major news?
Wall Street Breakfast
Market getting used to higher rates for longer
So barring kind of an announcement out of Washington, I think that it might be a good time for investors just to watch where the momentum is and figure out whether or not they want to ride any wave that might be there.
Wall Street Breakfast
Market getting used to higher rates for longer
So the obvious big news in terms of Fed prediction that happened this week was the CPI report, which came in very hot. Pretty much took a rate cut off the table for the March meeting and pushed it back quite a ways. There's now an 86% chance of no change in May. So we're looking in the kind of June, July, September timeframe for a cut.
Wall Street Breakfast
Market getting used to higher rates for longer
Another thing to look at is the chance of no cut at all this year. has gone up dramatically. It's now sitting at about 23%. This is based on market trading. It was 11% a week ago, so more than doubled in the course of the week. And the major catalyst for that is a CPI report. So the market's getting used to the idea of higher for longer.
Wall Street Breakfast
Market getting used to higher rates for longer
that we might have these interest rates even through the rest of 2025. Though by and large, stocks took it in stride. There was a sizable dip as the news came out at the opening of trading and then the recovery. And as we said on Thursday, we're now higher than we were before the news came out. So by and large, it's been kind of shrugged off.
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
Brian Stewart, our director of news here at Seeking Alpha. Welcome back to the show as we close out almost another month and head into April.
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
not necessarily a strictly car company, but as promised last week, a stock that we may be talking about every week is Tesla, which did see some improved numbers this week, but a stock that's been in the news for its volatility and questioning of where it's headed long term or also short term and near term as well. What are you seeing out of Tesla this week?
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
Great to have you. So lots of news of tariffs. Curious what's coming in the week ahead with this April 2nd date. What are you most focused on this week and looking ahead to next week?
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
And speaking of tech names and the tech sector, what are you seeing out of that part of the market these days?
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
Well, speaking of modest ambitions, we've seen a lot of news out of the weight loss drug makers. Talk to us about what you're seeing based on some recent trial data.
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
One of the biggest, as you refer to them, turkeys of the day as it pertains to Thursday was GameStop. They had some news around Bitcoin. How would you articulate for investors what's going on over there?
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
Is the sense that GameStop is just doing a strategy, MicroStrategy slash strategy, strategy?
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
And what would you say about this Bitcoin-gold conversation? Perhaps many using as, well, I would say certainly many using as an inflation hedge when it pertains to gold, but both of them certainly come into play when we're talking about uncertainty and volatility in the markets. There were price targets thrown out this week around gold for $3,500 in the coming year. What are your thoughts there?
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
What are you seeing out of both markets?
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
Is that an academic ivory tower theorizing around what Bitcoin could be but just isn't? Is that why it gets this kind of discussion around inflation even though it's not necessarily accurate?
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
And what other macro data points are you looking at or that you think worthy of sharing some of those data points with investors that we've seen or that are coming up?
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
I suppose that's why they haven't done it.
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
Right. You got to get a baseline.
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
um let me ask you this what are you seeing out of retail it's a sector that we've been talking about especially vis-a-vis tariffs and and how those are affecting things what are you seeing from the retail space so uh no new data about retail
Wall Street Breakfast
Tariffs, tech sluggishness, gold, bitcoin, and inflation
Wait and see unless bad. We'll take it at this point. We'll take it. We'll take it every time.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
So I don't think it's a NVIDIA-specific story. I think this is a market referendum on the AI situation in general. So I think that it's kind of TBD about where things are going. I think for the most part, people are happy to just tread water at this point and wait for more data.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
Yeah, so next week we have Broadcom coming out on Thursday. We have Marvell as well. So there is going to be some data points in the chip area on the horizon. So those are two key areas to look for for next week. If we broaden the lens a little bit and look for technology in general and not just chips, we have a bunch of cybersecurity companies coming out next week.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
Great to be back.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
I think the biggest of those is going to be CrowdStrike. CrowdStrike is down... was down sharply last year after its highly publicized outage in July, but has crawled back above those levels recently. However, it reached a 52-week high early this month, but it's seen a dip lately.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
So I think those earnings are going to be key for CrowdStrike specifically about whether or not it's sort of moved past that outage and is back to sort of regular business as usual.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
And then I think just looking at cybersecurity in general, I think that's an interesting place to look for technology in general, but also as we look at the new Trump administration spending priorities, whether or not companies with strong public balance sheet, as you will, strong governmental revenues, whether those companies are worried about cuts coming up.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
It's a good time to kind of peek in on Tesla. It's down 19% in the past week. This is part of a general slide. It's down 30% year to date and 42% from its 52-week highs late last year. There's a lot of worry about the Elon Musk distraction. He's busy with Doge. And not only does that take him away from running Tesla, but it's also becoming not a great look in general. There's talk of...
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
We're professionally bound to talk about NVIDIA at the start. The earnings just came out. The stock is down about 4% after earnings. The earnings themselves were very solid, beating expectations, stronger than expected guidance, but the stock is still down a bit. To be fair, the stock was up a bit beforehand. It was up about 4% the day before its earnings report.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
of boycotting Tesla, there's just becoming a very high profile and not particularly well-liked presence at this point. There's also been data this week from a European industry group, the European Automobile Manufacturers Association said Tesla sales in Europe were down 45% in January. That could be a sign of dissatisfaction with Musk specifically.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
Overall, EV sales were up in Europe in the same data set. So the fact that Tesla was down so sharply might be something very Tesla related. The fall has brought Tesla below $1 trillion in market cap for the first time in November. So you can kind of see the upside and downside of his close association with the Trump administration.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
You saw Tesla rally sharply after the election, but now that there's much more controversy around his activities in relation to the government, you're starting to see that having an effect on Tesla.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
Yeah, United Health was down 9% this week. As you said, the proposed Medicaid cuts are starting to raise red flags. That's a big part of their business. There's also a DOJ probe of its Medicare billing practices. So the stock in general is down 14% since early February. So this is starting to seep into the market, the idea that there's less government support in general.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
Another example is Palantir. There's concerns about the budget cuts have sort of taken some of the air out of that stock. It was up 24% after its earnings report in early February, but has recently had a five session losing streak. And that was a pretty dramatic drop. Each of those five sessions, it was down 3% and then two of them or a 10% or more drop.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
So you're starting to see, even if it's individual companies or sectors, starting to see kind of the ripple effect of budget cuts that are being put into place, or at least the proposed budget cuts. And then in general, you can kind of, if we take it back to a more macro level and look at the economic data, people are starting to get worried about the economy in general.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
We saw initial jobless claims jump to a multi-month high in the most recent data. And so you're starting to see worries about layoffs. This is critical ahead of next week's jobs data, which is a little backward looking. But still, I think people are going to be looking at that really closely to see if the cut in public jobs is starting to have a broader economic impact.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
I think they're starting to lower a little bit. The job market has been one of the bright spots. As we've been fighting inflation, the fact that the job market has held up as well as it has, has sort of given the Fed permission to kind of take the inflation fight more seriously than it could otherwise if it also had to worry about the economy.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
So this is kind of just giving back that free earnings enthusiasm. I think the general feeling is steady as she goes. NVIDIA is about 20%, 25% off of its highs. So the idea is we're not in bubble territory yet for the AI, but there is sort of signs of slowing growth. The NVIDIA data center revenues, that's the area that's very AI focused. That showed 93% growth.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
But if you have an economy that's starting to show some cracks, it puts the Fed in a real bind because if it cuts rates to protect the economy, then that could unleash the inflation goblin. But if you fight inflation, you might undermine any attempt to jumpstart the economy. So you end up in a situation where the Fed is sort of stuck between a rock and a hard place.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
Troublesome data point that affected the markets this week is the Conference Board's Consumer Confidence Index dropped to 98.3 in February. This was down from a little over 105 in January. That's the biggest monthly fall since August of 2021. Anytime you're saying biggest whatever since the COVID shutdowns, you're probably in sort of frightening territory. So one of the...
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
Sub-indexes in there is the expectation index dropped 9.3 points to 72.9. That's below the 80 mark. That's usually seen as a recession red flag. So you see consumers in general are just starting to look around and see high inflation, see an economy that doesn't seem to be... be as solid as it once was, and they're starting to get worried.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
Next week, there's a lot of retailers on the earnings docket. So in terms of getting a vibe about what consumers are thinking, I think those earnings reports are going to be important. One of the key ones is Costco. They're coming out Thursday. The company is recently off a 52-week high. It's gotten a lot of run in the fact that it's a low-price company. competitor.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
And so it brings in a lot of people who are worried about inflation and looking to find deals. Those are your Costco customers. But with the increases come valuation concerns. So there's worries of whether Costco can keep up the momentum that it's had. And then elsewhere, you have a lot of department stores like Macy's and Nordstrom's and then other clothing retailers like like Gap are reporting.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
So like I said, to get an idea of the spending habits of the general consumer, I think taking those reports sort of in aggregate would be a good data source.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
Well, the biggest preliminary to the waiver reports that's coming that we had was the Walmart earnings, which sent the stock down a little bit. There was just sort of worries that it couldn't keep up the momentum it had. Walmart's in sort of a special case because it has the benefit of size plus... the low price kind of business plan kind of works well in an inflationary environment.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
So companies that have sort of a higher price level like Nordstrom's, it'll be interesting to see whether or not they can kind of still draw people in or whether people are sort of looking around for cheaper deals.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
And another data point to be drawn from that, and this will be more from the conference calls and other commentary from management, is just whether or not there's concern about tariffs and whether or not that's going to interrupt
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
I haven't seen any. The earnings reports that are coming out are obviously a little backward looking. You're looking at least like six weeks backwards as the company sort of put together their earnings reports when the quarters end. But there are some commentaries coming out. For instance, Budweiser just released its earnings. It's up about 11% in the past week.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
It jumped 7% on its earnings report. It said that it sees only limited impact from tariffs. So that's a global company saying that it probably won't see a big hit from tariffs. In the sales in general, revenue was up 3%, but volumes were down 2%.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
So you have a situation where a company is making up for lower volumes with higher prices and then getting help from cost management from keeping costs low. In that particular case, it's basically a company that's managing its business well and in a difficult environment. So you're bound to find other companies that aren't managing as well in a difficult environment.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
And so it becomes just a much, much more sensitive process trying to tiptoe through the landmine. Well, one thing to note about tariffs in general is the companies don't pay them per se. Some might make the decision just to eat as much of the tariffs as they can, but other ones are going to just pass it on
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
this last quarter, which obviously is very strong, but it's down from 112% growth in the previous quarter. And that number was in the 400% range a year ago. So you're seeing kind of the peak of AI growth passed for NVIDIA. And so the question is sort of where is that growth number going to settle in?
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
to customers so you might see a a rush of higher prices or um and this isn't tariff related related but you've seen companies put in um
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
um extra extra pricing for the eggs you know as as egg prices have um gone up so you do see companies find ways to pass these costs on to consumers so the whether or not a company can do that is going to be based on their individual business so it's really going to be kind of company specific and so if you look at like budweiser in general it seems like so far they've been pretty successful
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
And you can also see that kind of filtering through to the consumer level in the Conference Board Consumer Confidence Index report. The inflation expectations, consumers' inflation expectations jumped to 6% from just over 5% in the previous month. Just as a reference, the Fed is looking to keep inflation about 2%. So you have consumers sort of seeing a 3%. predicting a 3X to the Fed's benchmark.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
So consumers are becoming ready for higher inflation. So that might give some companies a green light to go ahead and raise prices. On an ending note, underline again the jobs data that's coming out. I think that's going to be critical, especially as you're looking for Fed policy. Like I said, the Fed is starting to find itself in a trap.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
And so that'll be sort of the key to whether or not it has some inflation fighting room left to go.
Wall Street Breakfast
Nvidia's solid earnings, jobs expectations and fighting inflation
The only thing I note in terms of just general stock performance is that chips are down generally. And this isn't even just in response to NVIDIA earnings. This is over the past week. So we have AMD down 9%. ARM is down 10%. We'd kind of flagged Arm as a good AI bellwether just because it was part of the growth plan that people had put in place. And then Broadcom and Micron are also down.
Wall Street Breakfast
Past week dominated by corporate earnings stories
And that had the stock up 18% over the past week.
Wall Street Breakfast
Past week dominated by corporate earnings stories
Yeah, I think ADI gives us a good boost to the chip sector in general. So you saw Micron up 14% in the past week and Texas Instruments up 9% in the past week. NVIDIA was up as well. I'm sure we're going to talk about that when we're looking into next week. But looking into the chips, an interesting story in itself was Intel.
Wall Street Breakfast
Past week dominated by corporate earnings stories
It got a boost after Taiwan Semiconductor and Broadcom were reported to have interest in buying parts of Intel, so breaking it up. Intel's been a long running turnaround hope. So the company is looking to kind of get off the mat. And the M&A news, I think it's an interesting test of the new administration and what its kind of regulatory oversight will be in terms of approving or not approving M&A.
Wall Street Breakfast
Past week dominated by corporate earnings stories
This one has a lot of complexities, especially with the overseas elements of Taiwan Semiconductor. I mean, there's no deal in place now, so there's really nothing for the Trump administration to say. But I think it's a good litmus test. I think if you're interested in this sector, I think watching the headlines surrounding Intel and possible M&A activity could be a good sign of the feeling for...
Wall Street Breakfast
Past week dominated by corporate earnings stories
both players within the space about consolidation as AI becomes more important, and then also what the administration is going to do.
Wall Street Breakfast
Past week dominated by corporate earnings stories
I think it's still up in the air. Generally speaking, the Trump administration was viewed as pro-business, low regulation. But obviously one of his other tenants is kind of a nationalist bent, a protectionist bent with the tariffs and immigration policy. So...
Wall Street Breakfast
Past week dominated by corporate earnings stories
While it might look the other way in terms of general antitrust concerns in terms of dealmaking, the foreign aspect of parts of this deal might be problematic. So that's why I think it's a good test to just sort of see where sentiment actually lies within the administration.
Wall Street Breakfast
Past week dominated by corporate earnings stories
I think this past week was dominated by a few corporate earnings stories. Don't know that there was a firm direction given to the market by macro. I think we're still trying to feel out the Fed, feel out the administration, the Trump administration. So I think that the back and forth of individual stocks was kind of the news for the last week. And in general, the news was relatively good.
Wall Street Breakfast
Past week dominated by corporate earnings stories
Yeah, I think Alibaba is one to look at. It was only up 6% in the past week, got a mild boost after its earnings report. It's up 7% post-earnings, but that was after already running up significantly in anticipation to the earnings. It was actually up eight sessions in a row in the days running up to earnings. The earnings announcement is up 67% since mid-January.
Wall Street Breakfast
Past week dominated by corporate earnings stories
Post-earnings boost came with strong AI-related revenue, and that's been the hope over the past month is that those results would sort of fulfill the promise that the company would show a big boost in AI. And so since that was fulfilled, there was no letdown after the huge run-up ahead of the earnings. I think that's a good sign, again, for the AI trade that there are still pockets remaining
Wall Street Breakfast
Past week dominated by corporate earnings stories
where that has not been baked into the stock price yet. There were a couple of downside earnings reports in the past week. Bedtronic was down. It fell 7% on its results. It's basically flat over the last 12 months. It beat on its earnings and missed on revenue. Investors feel that the bid to high single digit growth rates that the company's been showing are disappointing.
Wall Street Breakfast
Past week dominated by corporate earnings stories
It's kind of sluggish growth. And honestly, the stock has been in the doldrums for a long time now. It came down during the pandemic as people pushed off. It's a medical device company. And so as people pushed off some surgeries because the medical community was obviously focused on COVID that cut into its revenue and it hasn't been able to recover yet.
Wall Street Breakfast
Past week dominated by corporate earnings stories
It's basically the same levels now as it was in October of 2022. So the stock has had a hard time coming back after that post-COVID drop. So it's worth kind of looking at. You and I had talked about past couple of weeks with the pharmaceutical companies coming out that there has been a longstanding post-COVID hangover in the healthcare sector, generally speaking.
Wall Street Breakfast
Past week dominated by corporate earnings stories
So I think that's something to watch going forward is when do these companies get into the next cycle of growth? Another company that was on the downside Unilever, which is a consumer goods company, was down after its earnings. And the larger thing to note there is just that one of the worries was commodity inflation.
Wall Street Breakfast
Past week dominated by corporate earnings stories
So it's just a sign that inflation remains problematic for some of these consumer facing companies.
Wall Street Breakfast
Past week dominated by corporate earnings stories
Yeah, just using Medtronic as the jumping off point, some of the commentary after those earnings came out was just there was no visibility of when the next catalyst for that stock was, where the next wave of large growth. So the company might be executing well in terms of moving the products that it has, but it's just not clear where that sort of next jump forward was going to come from.
Wall Street Breakfast
Past week dominated by corporate earnings stories
And I think that's probably true of a lot of these companies. the pharmaceutical companies that got a big boost from COVID, that was a lot of investment that they put into those drugs. So they basically put their pipeline on hold to move over to COVID during that time.
Wall Street Breakfast
Past week dominated by corporate earnings stories
And so I think some of them have had a hard time getting back to diversifying their R&D in such a way that they can get the next big one. And I do think that the weight loss drug boost has kind of built in to the stocks. There's a lot of competition in that area now. And so data comes out and new products hit on that front. I think they're all kind of running into a crowded market.
Wall Street Breakfast
Past week dominated by corporate earnings stories
So I do think there's sort of a look of what the next big, you don't want to call it a fad or a trend, but for lack of a better word, the next big healthcare trend is going to be.
Wall Street Breakfast
Past week dominated by corporate earnings stories
So where's the next growth? And everybody...
Wall Street Breakfast
Past week dominated by corporate earnings stories
know whatever the your sort of political feelings on it everybody got the vaccine for covet everybody was um you know taking tests for covet and so there was sort of full saturation for those kind of things so what's the product that's going to tap into the broadest possible public adoption because obviously if you go through healthcare companies you're going to find a few winners you know companies that that had
Wall Street Breakfast
Past week dominated by corporate earnings stories
Putting out a few of the highlights, Applovin had a brilliant earnings report. It is benefiting from a focus shift to AI and e-commerce. It's a software platform that advertisers use to enhance the marketing in content. And so it's a good kind of B2B platform. play if you're kind of trying to get the temperature of the market in general.
Wall Street Breakfast
Past week dominated by corporate earnings stories
an excellent test for a cancer drug or something like that. I mean, it's pretty easy to find big winners in the healthcare space. But when you're talking about the healthcare space in general, you kind of need those overarching themes that are going to drive the entire sector.
Wall Street Breakfast
Past week dominated by corporate earnings stories
Yeah, Berkshire is always going to make headlines because people are going to look for Buffett's macro assessments. So it's not going to be the results of the company specifically, but more about what Warren Buffett sees generally for the market. So watch for headlines there. I think in terms of the healthcare conversation, I think HIMSS is a good...
Wall Street Breakfast
Past week dominated by corporate earnings stories
company to look at just in terms of being sort of the low price direct to customer kind of company having kind of a different business model than a Merck or Pfizer. So seeing how its results are going, especially as we talk about weight loss drugs, and that's obviously a huge part of their business. So I think that that's definitely interesting.
Wall Street Breakfast
Past week dominated by corporate earnings stories
Other than those names, NVIDIA obviously is the big one coming out. I think if you're talking about the AI trade, that'll be a good litmus test of how that's going. Especially look for commentary from them about DeepSeek specifically and growing competition in the AI space generally. Also, they might have something to say about trade concerns, both tariffs and restrictions of selling products.
Wall Street Breakfast
Past week dominated by corporate earnings stories
certain chips to certain countries. So there might be questions asked in the earnings conference call about that. So that would be interesting to look at. And then just in a totally different sector, Home Depot and Lowe's are both reporting next week. The Home Depot especially saw a lot of strength in the second half of last year, but has been choppy lately. And
Wall Street Breakfast
Past week dominated by corporate earnings stories
A lot of that is concerns about the housing market with interest rates going up and the price of loans going up. But this could go either way for Home Depot if housing stock is getting older because home building is slowing down and its home equity loans become more expensive. So people can't pay to hire a contractor to come do their addition.
Wall Street Breakfast
Past week dominated by corporate earnings stories
You might see more do-it-yourself kind of upgrades in houses, which... would benefit Home Depot. So I would look at their commentary, both about the housing market in general and just how consumers are responding.
Wall Street Breakfast
Past week dominated by corporate earnings stories
So Walmart was down after its earnings, down about 6%. The outlook was cautious. So I think the worry there was that the consumer in general is starting to slow spending. You and I talked last week about how Walmart might benefit from people... replacing some of their purchases with lower cost things.
Wall Street Breakfast
Past week dominated by corporate earnings stories
As they move down the cost spectrum, that Walmart might be the beneficiary, kind of where people land as they start squeezing their budget. However, if they're having trouble grabbing customers, even in the sort of high inflationary environment, that might be a sign that people have stopped spending in general. So I think there's an eye on the consumer.
Wall Street Breakfast
Past week dominated by corporate earnings stories
So the stock surged 24% on the earnings report and continued higher in the following session. It's off 11%, sort of a profit taking. So there are some valuation worries, but in general, its results were kind of a sign that AI is still filtering its way through company results.
Wall Street Breakfast
Past week dominated by corporate earnings stories
The recent economic news has been relatively strong, jobs report and so forth. Next week, the GDP report is coming out. That's backward looking. It's a revised data for the previous quarter. So that's not going to be any new information. But I do think that Walmart can act as kind of an economic indicator in itself. And it shows a little bit of worry.
Wall Street Breakfast
Past week dominated by corporate earnings stories
on investors part and on corporate executives part about how much the consumer is going to hold it up.
Wall Street Breakfast
Past week dominated by corporate earnings stories
No, just that next week is also going to see the PCE indicator release. That's the Fed's favorite inflation gauge. Inflation data from last week was much stronger than expected, kind of sparked a mini panic about the Fed really pushed back expectations. That's come back a little in the past week. People have sort of moderated their expectations.
Wall Street Breakfast
Past week dominated by corporate earnings stories
Still, the next meeting for the Fed is still expected to be no interest rate cut. And then the meeting after that in May, also expected to be no cut. But now in the sort of June, July framework, people are starting to think that the next cut might happen.
Wall Street Breakfast
Past week dominated by corporate earnings stories
So that PCE indicator, it's either going to confirm the sort of hot inflation that we saw a week ago, or if it gives a different indication, it might move that expectation a little bit. So if you're looking at interest rates, that's the next big piece of data coming out.
Wall Street Breakfast
Past week dominated by corporate earnings stories
And so if you're an investor who can kind of pick the next company that's going to see the big AI boost, you can still get in pre-catalyst for some of these stocks. And another one for last week that had a big move was analog devices. It had better inspected earnings and guidance. Its bookings were gradually improving and increased its share buyback program.
Wall Street Breakfast
Amid market turmoil; compelling earnings coming
Brian Stewart, welcome back to Wall Street Breakfast. Great to be here on a Friday with you.
Wall Street Breakfast
Amid market turmoil; compelling earnings coming
Yesterday, we had some discussion talking about markets going lower. What are you seeing out of the markets? What are you most focused on at week's end and looking ahead to next week?
Wall Street Breakfast
Amid market turmoil; compelling earnings coming
Along with the losses from the weight loss drug makers, we also saw some big losses from the big discount retailers. Tesla, nobody paying attention to the markets is ignoring that fact. Tesla has been down pretty consistently. Starbucks has been down pretty consistently. What would you, is there a theme there?
Wall Street Breakfast
Amid market turmoil; compelling earnings coming
perhaps putting himself out there in the zeitgeist. And as you said, making a leadership mark, I would say maybe as much for optics as for anything else.
Wall Street Breakfast
Amid market turmoil; compelling earnings coming
Looking ahead to next week, what are you focused on there?
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
One interesting theme over the last week is there's quite a few old school consumer companies that did well following the earnings. One example is Philip Morris, which jumped 14%. the past week. That was kind of an individual company story. The company is seeing a very successful transition to smoke-free products.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
And so it was moving out of the traditional tobacco cigarettes and moving into things like nicotine packages and vapes. And so that process was seen as being sort of aggressively underway in the earnings since that drove But you also have companies like Coca-Cola, which beat expectations, showed strong organic sales growth.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
There's worry still about higher costs and the prospects of tariffs affecting a large international company like Coke. But by and large, the results kind of going into the current quarter that just finished have shown that it's prospering pretty well. And the same with a company like McDonald's, which is up 6%. in the past week.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
Interestingly, it missed expectations, but there was investors tended to focus more on the strength and global sales that it showed as well as the investments and value deals. So companies like Coke and McDonald's, I think are seen as value plays in an inflationary environment. So you have these strong brands that offer low cost products.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
Great to be here, Rina.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
There's a view that those kinds of companies will prosper in that environment. McDonald's missed expectations, but still went higher. Uber dropped in the immediate aftermath of its earnings, but is up 23% in the past week as a whole. So there was a dip and then a buy on the dip. I think the main catalyst there is Bill Ackman announced a stake in the company.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
And I think a lot of people saw that as a starter pistol for a higher move up. So I think there's a lot of traders that Jumped into that just sort of on his coattails to ride that trade higher. Also, Lyft dropped after its earnings a light booking forecast. So I think Uber saw the benefit of that. I think there was the idea that Uber might be winning that rivalry.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
And in general, and this has been a theme of a lot of companies. I mean, Tesla is a great example of a company that was seen significant benefit on the prospects of future technology, especially autonomous vehicles.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
And Uber is right there getting a tailwind from predictions that eventually it'll be able to kind of stick the AV landing and be able to finally have that fuel the top and bottom lines going forward.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
Yeah, just to discuss Tesla briefly, I think that has a lot to do with the perceived distraction of Elon Musk being at the centerpiece of the Doge debates and also making a bid and then withdrawing a bid for open AI. I think people did not see that as sort of a serious attempt to take over that company and more of a publicity campaign.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
And so I think there's a sense to which he's kind of taking his eye off the ball in terms of Tesla specifically. And I also think that Tesla stock ran up significantly in the post-election timeframe. And there's a process of profit taking that's going on for that. And so it's down 11% in the past week and is at a three-month low.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
There's kind of a background radiation going on in terms of the CPI report that recently came out and the effect on the Fed. Also shenanigans out of Washington, a lot of Doge related headlines coming out recently. I think that's going to be kind of a standard background noise for trading in the foreseeable future.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
But like I said, I think that's largely Musk personality related and not really a statement about people's opinions about AI or even Tesla's underpinning prospects. If we look at Palantir, I think that's an interesting one because it rallied immediately after its earnings report had a blockbuster. financial figures and has continued to stair step higher since.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
It's been alternating up days and down days since its earnings, but the up days are all bigger than the down days. So it's sort of a aggressive buy on dip going on there. Palantir has become the symbol of, I think, the next wave of AI speculation. Web Bush said about its earnings, the AI software era is now arriving. I'm paraphrasing there.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
In the first wave, it was the NVIDIAs of the world and sort of the pickaxe and shovel type companies for this gold rush. And now we're moving into the companies that are actually putting it into effect in these products and the sort of productivity and upgrades that it can give to customer UX and based on AI. And so I think Palantir has become sort of the spotlight company for that.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
And I think it's getting a lot of the money that's come out of some of the chip makers and the other first wave AI winners. Some of that money that's being trimmed out of those is moving into Palantir.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
Just looking ahead to next week, the earnings calendar is starting to slow down. There's still a fair number of reports coming out, but the biggest names are kind of off the table at this point. If you're looking for kind of a highlight for next week, I think Walmart. is going to get a lot of attention. It's sitting at 52-week highs recently. It's up 83% in the past 12 months.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
So in a lot of ways, it's been trading like a growth stock, even though there couldn't be a more stable establishment.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
Yeah, right. But yeah, there's been sort of... a rush into Walmart. It was not even a rush, it's sort of a steady drip, drip, drip over the last 12 months. And I think that's partly the same kind of Coke McDonald's value play, the expectation that inflation is going to drive people to lower price alternatives. Walmart's also getting a lot of credit for its e-commerce gains.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
It's making a lot of inroads there and international expansion. One thing to look out for when the earnings come out is whether or not the company is worried about tariffs. Again, it's a large international company. It's low price. kind of strategy is based around getting cheap goods from overseas.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
And so if the management there is starting to sweat it a little bit about potential tariffs, I think that would be a sign that other companies might be following in those footsteps.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
Yeah, I would expect it to emerge in the earnings conference call after it. I don't expect in the press release they'll say anything about it, unless they actually temper financial expectations. Sales growth won't be as strong as we thought because tariffs. But I don't expect that to happen. I think it'll be more, like you're saying, coded.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
It seems that we're going to have to kind of rifle through the kind of bickering in Washington. However, I think the stock market itself has seemed pretty immune to any of that. There hasn't been pickup and aggressive volatility over the last several weeks. I think by and large, it's been following momentum of its own. A lot of that is sort of still the AI trade. in effect.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
And I think it'll come out in the Q&A in the earnings report, earnings conference call.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
Honestly, I would be surprised if an analyst doesn't ask about tariffs in the conference call, then I don't know that they're doing their job effectively. I think if you're a Walmart investor, I can't imagine anything else being on your mind at this point.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
On Thursday next week. Don't forget, these episodes will be up with transcriptions at SeekingAlpha.com slash WSB. And for a full suite of news, analysis, ratings, and data on stocks and ETFs, go to SeekingAlpha.com slash subscriptions.
Wall Street Breakfast
Earnings reactions and the next wave of AI speculation
And I think there's still a lot of individual stock picking. I think with the earnings season peaking in the last couple of weeks, I think investors have largely been looking at the individual company's financial results and not been too worried about the macro scene.
Wall Street Breakfast
Recession risk and pockets of strength
Brian Stewart, I call him our fearless director of news, and he better be fearless in these type of geopolitical and stock market volatility and uncertainty that we find ourselves in. Brian, welcome back to Wall Street Breakfast. And can you start off with some good news? Is there some good news to be had?
Wall Street Breakfast
Recession risk and pockets of strength
And is that why tech led the sell-off this week, is because of the higher expenses likely coming?
Wall Street Breakfast
Recession risk and pockets of strength
What would you say about Bitcoin specifically, its movement in the crypto space? I'd like to remind the audience of one of my favorite quotes that we heard from John D'Agostino at our investing summit last summer. And he said in talking about cryptocurrency that volatility is not the same thing as risk, which I think would be wise for us all to keep in the back and front of our minds.
Wall Street Breakfast
Recession risk and pockets of strength
What would you say about where Bitcoin is going and how volatile it's been?
Wall Street Breakfast
Recession risk and pockets of strength
And broadly speaking, macro wise, what are you sensing? What are you seeing based on the news that we've had this week, based on the tariffs, based on this geopolitical brouhaha?
Wall Street Breakfast
Recession risk and pockets of strength
Anything else to note for investors or any other data points or things to look for or possible catalysts or possible opposite of catalysts coming up?
Wall Street Breakfast
Trump playing chicken with the world?
Yeah, I just don't think that this month's data means much because so much has happened on a macro level.
Wall Street Breakfast
Trump playing chicken with the world?
There's been such a seismic shift in the possibilities, but I think if we look ahead, if we go to sort of beginning of May, when we're going to get the April report, businesses are going to be responding in the next few weeks to the realities of what their supply chain is going to look like, what their cost basis is going to be, and sort of setting their employment levels there.
Wall Street Breakfast
Trump playing chicken with the world?
So that would be the first data point that would involve sort of companies responding to the new reality.
Wall Street Breakfast
Trump playing chicken with the world?
Another one next week is Delta Airlines, the first airline one. I think it'll be interesting just for the airlines. It's the first marker of demand for travel. Also, CarMax is an interesting one just because we are... getting a 25% tariff on foreign-made auto and auto parts.
Wall Street Breakfast
Trump playing chicken with the world?
And so CarMax, which is a car dealer, it'd be interesting to see if there's kind of a run on the bank for cars made before the tariffs put into place. So just in terms of a macro data point, it might be interesting to check out that.
Wall Street Breakfast
Trump playing chicken with the world?
a equation related to the trade deficit that we have with various countries, a tariff rate sets. And so the highest rates on countries like Cambodia is 49%. And so I believe doing this off top my head, but I think China was 34% on top of the 20% that we'd already put in place. So extremely high in sort of normal sort of economic structures, the
Wall Street Breakfast
Trump playing chicken with the world?
the tariffs are just going to be passed on to consumers. So you can expect items that are coming in from those countries to just become 49% more expensive or 34% more expensive, depending on where they come from. So as we kind of look at the fallout today, unsurprisingly, you see a lot of declines in the retail sector, especially in the smaller cap and mid cap retail space.
Wall Street Breakfast
Trump playing chicken with the world?
So just to give some examples, like Five Below, a low price retailer that gets a lot of items from overseas retailers, China, Taiwan, Vietnam, those kinds of places. So it's down 26% as we're speaking. Gap is down 18%. Kohl's is down 24%. Victoria's Secret's down 20%. So companies that have a supply chain that's very, very reliant on those countries are going to see a hard hit.
Wall Street Breakfast
Trump playing chicken with the world?
We're also seeing a lot of tech stocks get hit. One of the standouts is Apple, which is down about 8%, getting back to levels last seen last summer. Also just kind of doing a quick check of the Magnificent Seven. We have Amazon down 7%, Nvidia down six, Meta down six. They're all kind of reaching
Wall Street Breakfast
Trump playing chicken with the world?
september levels one i guess you'd call it a standout in terms of how well it's holding up today is microsoft it's only down one percent today but it's just off a 52-week low down 10 so far this year so it's already kind of priced in some of this action so we're seeing kind of a broad-based focused on consumer and technology stocks as like i said we're just adjusting to the reality and kind of trying to figure out what the reality is going to be going forward
Wall Street Breakfast
Trump playing chicken with the world?
I mean, not economically. I think if you want to take that as a signal as to the process by which these tariffs were arrived at. It seems to be there was a spreadsheet somewhere and there was equations used and sort of spit out. And there wasn't sort of a review process to see sort of the reality of the situation on the ground and what this would mean and what this... meant.
Wall Street Breakfast
Trump playing chicken with the world?
Yeah, obviously. So we're recording this on Thursday as the markets fall following the tariff announcement last night. The tariffs were much more draconian than people had predicted. So the market is adjusting accordingly. If you're taking the optimistic view of the process that we're now involved in, Trump is in the process of doing a negotiation tactic.
Wall Street Breakfast
Trump playing chicken with the world?
And so if you want to look at it as a glimpse as to the Trump administration's process to putting these in place, and if you're an optimist, maybe that points to the idea that this is just an opening gambit, that we were setting a number. We need that number to be justified in some sort of way. So here it is. And then now we're going to talk to the individual countries.
Wall Street Breakfast
Trump playing chicken with the world?
Obviously, you can't talk to an uninhabited island, but those tariffs aren't going to affect consumers anyway. So we'll kind of see how things shake out. Generally speaking, looking back at past administrations, they've been very responsive to the stock market. That's one of the kind of main signals that...
Wall Street Breakfast
Trump playing chicken with the world?
presidential administrations have used to determine popularity in the absence of, you know, when elections are far away, if you want to sort of judge popular opinion, stock market is one of the indexes that they use. So traditionally, historically, a move like today would have the White House discussing internally next moves. I'm not sure how responsive the Trump administration is.
Wall Street Breakfast
Trump playing chicken with the world?
We just don't know. The administration's new. It hasn't changed policy much in response to previous stock market dips so far this year. So it remains to be seen exactly what the next steps are.
Wall Street Breakfast
Trump playing chicken with the world?
So just to review the action yesterday. So Tesla was down early in the day based on the delivery numbers. As you pointed out, there was a bounce back later and the stock was higher, ended higher before being down today, kind of after the tariff announcement. I think part of that was there was already an expectation in the market that the Q1 deliveries were going to be bad.
Wall Street Breakfast
Trump playing chicken with the world?
They were worse than expected. And so you saw a dip, but a lot of that had already been priced into the stock. And so I don't know that deliveries were ever going to have a lingering impact on the stock price. I think that was always going to be sort of the jumping off point for whatever was coming next. I do think that Politico story did provide a catalyst on the upside.
Wall Street Breakfast
Trump playing chicken with the world?
I'm using Dan Ives now as sort of a bull sentiments index. He's been pounding the table that... Musk's activity in Doge have been very problematic for Tesla's brands and that he needs to step away from Doge and come back to the company and take the steps necessary. He calls it a moment of truth for Musk. So if you kind of take that as sort of the bull's view of the stock, that's a necessary step.
Wall Street Breakfast
Trump playing chicken with the world?
You can see why the stock would rally on the idea that he was stepping back from Doge and moving back to sort of full-time Doge. management of Tesla. Later, after that report came out, both the White House and Musk denied that it was true. It's not clear how much of that is saving face, how much of that is truly Musk's intent.
Wall Street Breakfast
Trump playing chicken with the world?
The bottom line is it's not clear right now what Musk's plans are going forward, how much time he plans to spend at Doge, how much time he plans at Tesla. That uncertainty itself is a problem for Tesla. So a lot of the future of Tesla depends. And I'm talking about the near-term future.
Wall Street Breakfast
Trump playing chicken with the world?
If you're a long-term bull, you're betting on autonomous driving, you're betting on robots, you're betting on the building out of the green infrastructure, solar and charging stations and all the parts of Tesla that point to a bright future. But in the near term and the medium term, Musk is so tied to the company that it is dependent.
Wall Street Breakfast
Trump playing chicken with the world?
The movement of the stock in the near term is going to be very dependent on how he kind of handles the public outcry.
Wall Street Breakfast
Trump playing chicken with the world?
He's playing chicken with the rest of the world. These are sort of opening gambit to negotiations. And so over the next few weeks, we're going to see these mitigated or exceptions made to the point where they won't be as aggressive as they are now.
Wall Street Breakfast
Trump playing chicken with the world?
So you point out some bright spots today in the retail sector. So I guess TJX would be the ticker, but that grouping of companies, which TJ, TJ Maxx, Marshalls, that company, it's up 1.6% today. It was up 6% going into today in the previous week. So the stock was already seeing a boost. One of the basically buys inventory from other retailers.
Wall Street Breakfast
Trump playing chicken with the world?
So when companies have too much inventory, it'll take it off its hand and sell it at discounted prices. That's its business plan. So because it has this flexible supply chain, it's not as plugged in to... it can move around in response to these tariffs. It's also benefiting from the general move to lower price options.
Wall Street Breakfast
Trump playing chicken with the world?
So it's been one of the standout winners in the retail space today and in the near term. You also see companies like Costco and Walmart. Costco's up slightly today and Walmart's down slightly, but down much less than the market in general. Also Walmart's up about 5%. over the previous five days anyway.
Wall Street Breakfast
Trump playing chicken with the world?
Walmart took a dip back in February after it issued soft guidance, but in recent days it's reportedly been pushing its Chinese suppliers to lower costs. So I think there's a bet that companies like Costco and Walmart in a situation where all retailers are gonna be hurt by these tariffs because their supply chains are going to be affected by much more expensive
Wall Street Breakfast
Trump playing chicken with the world?
that companies like Costco and Walmart are large enough that they can negotiate better prices. So even though the entire industry is going to be a general loser relative to their competitors, Walmart and Costco can get better deals and so therefore can still offer lower prices.
Wall Street Breakfast
Trump playing chicken with the world?
So RH, Restoration Hardware, is down about 39% today. I mean, that's partially tariff-related, but it had negative earnings as well. It missed expectations and gave soft guidance. It's described the current housing market as the worst housing market in almost 50 years. It's a luxury furniture maker, retailer, luxury furniture retailer. And it's just in the perfect storm.
Wall Street Breakfast
Trump playing chicken with the world?
The pessimistic view is that Trump isn't interested in coming to any sort of reasonable terms with countries, that there's a more kind of political component to the tariffs more than economic, and that they could conceivably spark a worldwide recession in the near future.
Wall Street Breakfast
Trump playing chicken with the world?
Everything's going wrong for macro speaking for RH. And so you can see it losing a large chunk of its value today. In terms of the other tech companies, there's Besides the supply chain issues that are being affected by the tariff, there's also the fear that the AI build-out is not going to be as aggressive as originally hoped. I think there's just a general moving away.
Wall Street Breakfast
Trump playing chicken with the world?
There was already a general moving away from tech into more defensive. People were hedging their bets a little bit on tech. And so I think this has only exacerbated this. As we discussed during the sell-off that happened earlier this year, if you're bullish long-term, bullish generally, the best case scenario is that it falls quickly and finds a bottom quickly and then starts to recover.
Wall Street Breakfast
Trump playing chicken with the world?
So in a certain sense, if you want to take sort of a reversely positive look at a day when The NASDAQ at its lowest point was down more than 5%. You can say we washed out all the concerns and now we can have a better base to build on. So if you're a tech bull, this is a great chance to get tech companies at a reduced price.
Wall Street Breakfast
Trump playing chicken with the world?
If you're convinced that we're headed straight into an economic brick wall, then this is just the beginning.
Wall Street Breakfast
Trump playing chicken with the world?
So next week, we start to get the earnings season started.
Wall Street Breakfast
Trump playing chicken with the world?
churning next week is financial focus there's not a lot of tech companies on the docket but in the weeks following so as we get into the tail end of april we should start to get more tech companies reporting commentary from those tech companies is probably going to be pretty cloudy i think a lot of them are going to have to suspend guidance or sort of generalize their guidance in a way that that makes it difficult to get visibility just because they're all gonna be scrambling
Wall Street Breakfast
Trump playing chicken with the world?
to figure out the tariff situation. But within those earnings reports and the commentary that the management is going to provide, there should be kind of line items about underlying AI demand.
Wall Street Breakfast
Trump playing chicken with the world?
And so I think investors should look at that for longer term investment planning, looking for those nuggets of information that are going to come out of these earnings reports about the underlying demand for infrastructure build-out.
Wall Street Breakfast
Trump playing chicken with the world?
I feel that the market's going to be very macro focused for a while. So I think individual companies, there might be large positive surprises or large negative surprises. However, in general, I don't know if that's going to provide a catalyst to move the overall market because I think we'll be so obsessed. with political machinations that are going to surround the tariff announcements.
Wall Street Breakfast
Trump playing chicken with the world?
But I do see it as a signpost as we're going to start getting more earnings related data, financial related data in general. So I think the market's going to, over the next few weeks, start the process of kind of turning inward a little bit and taking its eyes off of Washington and more on Wall Street in general.
Wall Street Breakfast
Trump playing chicken with the world?
So next week, we got the FOMC minutes, which are going to let us know what the Fed was talking about and thinking about when it made its last rate announcements. We're also going to get the CPI and PPIs. We're going to get the latest inflation data.
Wall Street Breakfast
Trump playing chicken with the world?
I think the inflation data, even more than the jobs report or the manufacturing report, I feel that given the situation with tariffs and the possible economic implications of those, that that data is going to be seen as backward looking. It just does not describe the reality that we're living in sort of post tariffs.
Wall Street Breakfast
Trump playing chicken with the world?
So I don't know that that's going to have a huge impact on the thought process, but the CPI report might because it will kind of define the baseline as we look to whether or not tariffs are going to cause higher prices. I mean, the worst case scenario still remains that we end up in some sort of stagflationary situation. environment demand craters because everything gets too expensive.
Wall Street Breakfast
Trump playing chicken with the world?
Yeah, I think that the news flow over the next foreseeable future is going to be kind of how sticky are these tariffs? Is this the end state that we're just going to put these tariffs in place? Just to give some perspective to listeners who haven't sort of dug into the details yet, it's 10%, kind of a minimum. Every country gets at least 10% tariff. And then through a...
Wall Street Breakfast
Trump playing chicken with the world?
And so we have a recession, but prices remain sticky because tariffs are adding to already existing inflationary pressures. And so prices remain high and jobs start to bottom out. So we could see a worst case scenario brewing. So I think that the inflation report that comes out next week will be very important into sort of setting those expectations.