Latest news with #WorldwideExchange
CNBC
12 hours ago
- Business
- CNBC
Traders head into the second half of the year with stocks at all-time highs, jobs report pending
Next week kicks off a new trading month as well as the back-half of 2025, and Wall Street will be watching to see if stocks keep up their recent than momentum. Stocks have made a massive comeback after seeing steep declines in early April, when investor anxiety around President Donald Trump's sweeping tariff policy put the S & P 500 near bear market territory . On Friday, the S & P 500 rose to a fresh all-time intraday high , spurred by optimism that trade deals with China and other U.S. trading partners would be announced soon. The three leading indexes are on pace to close out the first half of the year with solid gains. The S & P 500 as well as the Nasdaq Composite are up more than 5% year to date, while the Dow Jones Industrial Average has advanced more than 3%. .SPX YTD mountain S & P 500, year-to-date Yet, some on the Street, such as BlackRock's Rick Rieder, are already projecting that the market could surge even higher in the year's second half. That's because the artificial intelligence revolution could bring down inflation , thereby sending the market higher, he said Wednesday during a keynote speech at the Morningstar Investment Conference. July 'fireworks'? Supporting a sustained rally, the market is also entering a historically strong month. July has been a positive one for the S & P 500 for the last 10 years straight and is the index's best month over the last 20 years, according to Ryan Detrick of the Carson Group. He also noted that July is the best month in a post-election year. "When you're higher in May and June like we're probably going to be with June, because we're up pretty good, July does better, and the final six months of the year have been higher 15 of the last 16 times," the firm's chief market strategist said Thursday on CNBC's " Worldwide Exchange ," noting that his word of the day is "fireworks." "When these weak months are strong, like we're doing right now, that could be a signal this bull market is alive and well." However, others are more skeptical that July will be smooth sailing for the market, seeing that Trump's 90-day tariff pause is set to expire on July 9. While the White House said Thursday that the deadline " is not critical " and that "perhaps it could be extended," the ensuing uncertainty around it could pose a risk. "Elevated macroeconomic and policy uncertainty suggests that equity volatility should remain high in H2, with multiple potential catalysts for volatility such as the July tariff deadlines," Goldman Sachs analyst Andrea Ferrario wrote in a Thursday note. On top of that, current valuation levels could signal the market may be getting ahead of itself. The S & P 500 currently trades at 23.3 times earnings, per FactSet. By comparison, the index's forward price-to-earnings ratio at the peak of the dot-com bubble was at 24.4 times earnings, as said by DataTrek co-founders Nick Colas and Jessica Rabe in a recent post on X . "A bullish call on U.S. large caps therefore requires believing that we can get to 1999-type valuations," they wrote. "The good news is that 2025 has a much more positive setup than 1999 (rate cuts, cheaper oil, greater S & P Tech exposure). Even still, current valuations reflect a full glass of optimism." Jobs on deck At this point, significantly more gains for stocks depend on the U.S. economic environment remaining rather stable, said Anthony Saglimbene, chief market strategist at Ameriprise. That will come especially into view next week. With U.S. markets closed Friday and a shortened trading day Thursday due to Independence Day, a slew of economic data is set to be released Thursday morning, including June's nonfarm payrolls reading. Economists polled by Dow Jones are expecting the report to show 115,000, per FactSet, down from the previous month's reported growth of 139,000 . "I think the most important kind of data to look at right now, and especially since next week we're going to get some of it, is employment," Saglimbene told CNBC. "The only time that consumers really pull back is when they fear they're going to lose their job or they've lost their job, and if we see employment data kind of remain firm, it's unlikely they're going to materially alter their spending, which is a positive for the economy, even with all of this uncertainty around trade and tariffs." Tuesday 9:45 a.m.: S & P Global manufacturing PMI (June) 10 a.m.: ISM Manufacturing (June) 10 a.m.: JOLTS (May) Wednesday 8:15 a.m.: ADP employment report (June) Thursday 8:30 a.m.: Nonfarm payrolls (June) 8:30 a.m.: Initial jobless claims (Week ended June 28) 8:30 a.m.: International trade (May) 9:45 a.m.: S & P Global services PMI (June) 10 a.m.: ISM services (June) 10 a.m.: Factory orders (May) U.S. stock market closes at 1 p.m. Friday U.S. markets closed for Fourth of July holiday
CNBC
2 days ago
- Business
- CNBC
Tariffs top CFO concerns as recession fears grow
Frank Holland on CNBC's Worldwide Exchange breaks down Q2 CFO Survey: 41% see tariffs raising costs, 79% expect Trump tax cuts extended, and nearly 70% expect a recession by 2026.
CNBC
3 days ago
- Business
- CNBC
The bull case for small caps and chipmakers set to benefit from more defense spending
(This is a wrap-up of the key money moving discussions on CNBC's "Worldwide Exchange" exclusive for PRO subscribers. Worldwide Exchange airs at 5 a.m. ET each day.) Investors are looking for opportunities in gold as well as chip stocks to play the expected increase in global defense spending. Worldwide Exchange pick: Barrick Mining Gina Sanchez of Chantico Global sees Barrick Mining having more upside despite a recent pull back in gold prices. She added that it has an attractive valuation, trading at approximately 10.5 times forward earnings. "The demand for gold will likely continue [and] a proxy for that in the equity space is a miner like Barrick Mining," said Sanchez. "It is very well priced, while the rest of the S & P 500 is not. If you think about where we are with tariffs, margins are not exactly back to normal. … Any hit to commodity prices is going to be tough to pass through, you are going to have equities get hit and valuations come under pressure. So I think a cheaper part of the market is going to become more attractive later in the year." Barrack Mining has a dividend of nearly 2% The bull technical case for small caps Craig Johnson of Piper Sandler sees a potential 16% upside for small caps based on the technical moves in the Russell 2000 . "It has made what I would define as a pretty impressive inverted 'head and shoulders' bottom," said Johnson. The Russell 2000 is trading above its 100-day moving average and just below its 200-day moving average. Semiconductors and defense Jordan Klein of Mizuho said typically the defense sector is not a significant source of revenue, but there are a number of names that could benefit from increased spending in Europe and the potential for more spending in the U.S. "One in the analog space is Analog Devices that gets decent revenue from defense," said Klein. "Another name that is diversified is Macom , their defense business is growing very rapidly." Klein said his top picks in the semiconductor space are what he calls "The Three Horsemen:" Taiwan Semiconductor , Broadcom and Nvidia .
CNBC
4 days ago
- Business
- CNBC
Defense stocks to buy as spending bill moves through Congress; trading small caps
(This is a wrap-up of the key money moving discussions on CNBC's "Worldwide Exchange" exclusive for PRO subscribers. Worldwide Exchange airs at 5 a.m. ET each day.) Investors are looking for opportunities in the oil and natural gas space. They are also eyeing a tailwind for defense stocks in President Donald Trump's spending bill. Worldwide Exchange Pick: EOG Resources Patrick Fruzzetti of Rose Advisors said EOG Resources is a good buy despite the decline in oil prices. "It's a premium driller with a great balance sheet, good assets they have been in West Texas for a long time, they are expanding in Utica (Ohio)," said Fruzzetti. "With the environment we have been in geopolitically it's always worth having some exposure oil and gas in your portfolio." EOG Resources shares are down more than 1% in 2025. The stock pays a more than 3% dividend. Investing in defense Sheila Kahyaoglu of Jefferies said she is surprised that defense stocks haven't moved higher during the escalation of the Israel-Iran conflicts and U.S. strikes. However she said a new tailwind for the space for legacy players like RTX , Lockheed Martin and Northrop Grumman could come from Congress in the "Big Beautiful Bill," with defense spending proposed to increase by $150 billion, or roughly 13%, year over year. "If (President Trump) gets the $150 billion approved, maybe you could say it's all used in fiscal 2026, and it's clear he wants to be supportive of his 'Golden Dome' project which would literally be half of that $150 billion, $75 billion. A golden dome would be a beneficiary for existing systems because he wants to deploy it in three years," said Kahyaoglu. Two other stocks Kahyaoglu said are getting recent investor attention Israeli defense contractor Elbit Systems and Kratos Defense & Security Solutions . Investing in industrials Keith Lerner of Truist sees more upside in industrials that have been the leading sector year to date. "I think Industrials lead by defense continues to be something that will have a big," Lerner said. He added: "It is also an indirect AI play with things like cooling as an example." Lerner said FedEx earnings could have an impact on sentiment within the sector and advises investing through a diversified ETF rather than trying to find individual winners with the current trade and geopolitical uncertainty. Outlook for small caps Daniel Morris of BNP Paribas sees gains ahead the Russell 2000 . "If you increase your allocation to the S & P 500 you are implicitly betting more on that tech call," Morris said. "The appeal of small caps then becomes that you can increase your exposure to U.S. growth without increasing your exposure to megacap tech. We see it as diversified access to US growth." The Russell 2000 is more than 13% away from it's 52-week high, while the S & P 500 is 2% from a new all-time high.
CNBC
18-06-2025
- Business
- CNBC
Investors are buying Amazon and low-volatility ETFs as uncertainty reigns supreme
(This is a wrap-up of the key money moving discussions on CNBC's "Worldwide Exchange" exclusive for PRO subscribers. Worldwide Exchange airs at 5 a.m. ET each day.) Investors are looking for opportunities in the Magnificent Seven and for ways to play the potential for more volatility in the market with Middle East tensions continuing. Worldwide Exchange pick: Amazon (AMZN) Jeff Kilburg of KKM Financial said Amazon is a smart buy even in a volatile market and credits its year to date decline to profit taking. "The way they are doing custom chips, the way they are approaching AWS (Amazon Web Services) … I'm excited," said Kilburg. "Going back to Q4, Q1 of this year I was pounding the table concerned about Mag 7 being overconcentrated. What have we seen? A massive repricing, reevaluation of Mag-Seven. Right here, right now it makes sense." According to FactSet, Amazon trades just below 32 time forward earnings. On Jan. 28, it traded at nearly 38 time forward earnings. The Fed and the bond market Philip Straehl of Morningstar sees opportunity in intermediate bonds in the current market environment. "The fiscal backdrop has been a source of some volatility on the long end, we like Treasurys as an investment we, we do favor the intermediate part of the curve," said Straehl. "We continue to think the news cycle around the budget bill that is going to make its way through Congress in the weeks to come is going to provide an impetus for a bit more volatility." Straehl added the short end of the curve could become more attractive if the Federal Reserve has a more hawkish outlook than expected. Lauren Goodwin of New York Life Investments sees continued volatility in the bond market, especially at the long end of the curve due in part to foreign investors reducing their purchases. "The dynamic … is real, it is happening. We are seeing it not only among retail but the most sophisticated institutional investors even if it's just on the margin questioning their geographic allocation," she said. Goodwin added she doesn't expect the Fed to respond to this trend in the near term, but they could take action in the future. "The role that the Fed could play in the long term is a buyer of last resort. Engage in some financial repression with respect to maintaining some Treasury market volatility. We don't think we are anywhere near that stage in policy management of the issue. We anticipate that dollar depreciation will continue on the margin … Treasury market volatility especially on the long end is a reality for investors." Investing in Low Volatility ETFs Steve Sosnick of Interactive Brokers believes investors need to consider investing in low-volatility stocks and ETFs due to the geopolitical uncertainty. "Lower Beta, high divided stocks are definitely a way to stay invested while insulating yourself," Sosnick said. "High Beta is great when the market is going up, but not when the market is floundering. If you want to stay invested dividends provide a lot of ballast." Sosnick highlighted the Vanguard Russell 1000 Value ETF (VONV) along with the Vanguard U.S. Minimum Volatility ETF (VFMV) as two ways to the play the current market environment. Both have outperformed the S & P 500 year to date.
