Power Lunch - S&P 500 slips in volatile trading ahead of tariff rollout 4/1/25

Episode Date: April 1, 2025

The S&P 500 is pulling back amid another volatile session, as markets await clarity from President Trump regarding his tariff policy rollout. Wall Street also faced pressure from weaker-than-expected economic data. We’ll tell you all you need to know. Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

And welcome to Power Lunch, everybody. Tariff confusion whipsawing your investment. Stocks mostly up, at least for now. But remember with tariffs, nobody knows exactly what's going to happen. But we do know that tomorrow is supposed to be the day. And we're going to set you up for everything we still know. Endo? Let's talk about what stocks are doing right now.

We have the Dow down 150 points, but we're well off the session lows of down more than 400. The S&P is down about four. The NASDAQ is still positive by about a third of one. So bucking the trend of the first quarter for sure. One Dow stock dragging things lower is Johnson and Johnson. After a judge tossed out the company's plan to settle talent lawsuits by shifting liability, they filed for bankruptcy on that issue. The third time, shares are down 6% worst day since 2020.

But six of the seven, Mag 7, are higher today. Contributing to those gains we've seen in the NASDAQ, Tesla up nearly 6%. Apple also just turned lower, but was one of those green names just a moment ago. And look at the 10-year yield continuing to fall down to about 4.15%. Unfortunately, on not so great news. Economic data this morning, bad ISM overall number back in contraction, the employment number in particular, Brian, we'll have a lot more on that coming up. Yes, all right.

We've got a lot more to do this whole hour, but why don't we begin the hour with your money? And it's a decent start to a new quarter, and you could probably use a fresh start because the S&P 500 and NASDAQ are coming off their worst three-month period, their worst quarter in over two years. But that was the past. The question now is what comes next. The data shows it's about 50-50, historically on the markets going up or down after a quarter like this.

Got a lot of earnings coming out. Let's bring in now some friends to help you navigate through all this. That is RBC's Lori Calvesina. She just cut her S&P 500 year in price target to 6,200 from 6,600. But is that maybe even too optimistic given all? the, dare we say, uncertainty. Lori Calvacina is head of U.S. Equity Strategy at RBC Capital Market. She is on set.

Jeff Kilberg, founder and CEO of KKM Financial and a CNBC contributor. Lori, good to have you on. I tweeted out something tongue-in-cheek a few moments ago. Okay, I've been listening to CNBC all day, and all we hear about is uncertainty. I've been doing this since 1996, almost 30 years. I'm trying to remember when I had certainty at all,

multiple boom bus, 9-11, multiple wars, global pandemic, you name it. How uncertain of a time is this right now? So it's a great observation, Brian, and maybe we should be using the word angst instead of uncertainty. But I would say uncertainty feels worse when valuations are expensive and sentiment has been frothy. And while that's not exactly where we are today, that was the setup coming into the year. So I think we're still dealing with some of those residual effects right now. The other thing I would just say on the uncertainty point, I'm really eager to hear what companies say in this next reporting season because in the last one, I felt like all I was hearing was uncertainty, uncertainty, uncertainty, and not a lot of useful information. But Jeff, I love, love, love, love, that's four

loves, what Lori just said, because you ever heard the thing like if it's always somebody else, it's you? Right? You just, Lori just highlighted this is a stock market problem. What I mean by that is because we were valued at certain almost price to perfection, that adding any uncertainty is going to sort of kneecap the markets, and we're down, what, 5 or 6 percent. So how do you see things playing out from here? And how would you gauge the level of, quote, uncertainty we have right now? Well, if we were playing a game in college and took a sip every time we heard uncertainty,

so we'd all be on the ground by now. We drunk by noon, Jeff. Drunk by noon. I think Lori is really correct and smart to bring up the fact that where did we come from? We came from back to back years in the S&P 500 of up over 25%. So to see this repricing, this revaluation of the MAG 7, it doesn't feel good to see the S&P 500 come down 10%. But I'm going to lead on Fed Chairman Powell here. I can't believe this, but I'm actually going to use his word transitory.

He talked at the last Fed meeting about tariffs being transitory. I'm optimistic. I think we are overpriced to the downside here. I think the souring sentiment is providing an opportunity. And I'm not a contrarian, but I look at the VIX, you know, just here at 2021. And I think people have overpriced or potentially book profits. Maybe all this month of March's March Madness was more of a disguise to book profits from the last two years. So I think once we get some certainty tomorrow and get rid of our anxiety or our angst, like Lori said,

I think the market has the ability to have a little bit of a 2 to 4% kind of rapid. to really kind of reprieve everyone's anxiety. Lori, it seems like that's the message from the market right now, right? This whole week it's been almost saying, okay, we've priced in some of the worst case stuff, maybe it'll, but is there uncertainty going to be resolved tomorrow? What if there's a phase in? What if there's just, you know, the next day break? And we have to see how all the trading partners react, and then if we react to them,

I'm just curious. No, I think that's a great point. You know, the market sort of had that couple of days now where we've traded down and then we've shown some resilience and moved back up. So I think the market is trying to stay calm and take a wait and see approach, but there's still a lot of that angst under the surface. And I think you hit the nail on the head. I mean, is the uncertainty that's concerning markets going to be resolved tomorrow?

I feel like the conversations two weeks ago where, yes, the conversation over the past week is no. And I think that's really what's crucial for markets. The problem at this point in time, right, it's not the tariffs themselves. It's sort of that plus all the residual impacts, right? And this sort of uncertainty, the pause it's created in business activity, the potential for pullback in consumer spending. we don't have answers those questions yet. And so I think, number one, investors want to know how much damage has been done. And two, are we going to have the potential for more damage if we don't dial down some of that uncertainty?

So that's really what the market's struggling with right now. Although we also, Kilberg, have a couple of interesting data points today from Israel and Vietnam, where they've tried to kind of get ahead of this and maybe lower some tariffs. And is that message kind of, yeah, behind the scenes, our trading partners, maybe even the White House have been working on kind of saying, okay, you don't want this to happen? Like, here's how to get these barriers to mutually come down. And all of a sudden, you could look through and say, hey, we could come out to, you know, a better situation than we feared. Potentially, yes. Does the headwind of tariffs become a tailwind in the U.S. economy?

And I think there's rumors coming out of India about reducing tariffs. But I think ultimately, to look at the glass half full, you have to have the ability to realize what's been priced in. We're about to go into earnings season, Kelly. And earnings season has really been knee-capped. When you talk about the expectations for growth in Q1, it was up at 12.2. It's been revised, 35, 40 percent lower to 7.7 year-over-year growth. So when I see people lowering their targets like Lori, and I understand you have to lower your targets. When we talk about all the reconfiguring of forecasts just over the last month or two

when you really see the potential teeth of these tariffs, that's what President Trump wanted. He's been a historical negotiator. I think his bark is a lot louder than his bite. Well, you know what, guys, sit tight. We're going to keep you both around. We're going to go to Rick Santelli, but Lori and Jeff are going to come back to you. So we're not saying goodbye because Rick Santelli, all the stuff we just talked about and more. We've actually got a little bit of a move, not a little bit, maybe more than a little bit of a move in the bond market right now.

Oh, absolutely. There's little doubt that what's going on with equities, you know, we have the equity markets, anomalies going on, and we have shadow boxing by the interest rate complex. Let's look at an intraday here of 10-year note yields. And you can see that the 845 data was pretty good. We saw S&P global PMI's improve. So rates started to move up. And then right around 10 o'clock is when the weak ISMs came out,

PMI ISMs came out. And you could see the market moved lower. And if we look at two weeks, Brian, with the S&P, the two-year and the 10-year, we could see the shadow boxing going on. And actually, the two-year is tighter than the tenure. The tenure gets a little bit out of whack sometimes, and that makes sense, considering all the deficits we're carrying.

But maybe the most underappreciated move, and I think Jeff and others will agree with this. We've always asked what's going on with the Fed put. Okay, this next chart's really fascinating. This is a year-to-date chart of December Fed Fund futures on top of the S&P 500. And do keep in mind that these Fed Fund Futures are very close to making new highs for the year. The higher they go, the more easing were put in.

The Fed Fund Futures are decent, implying three rate cuts. And as you look at S&P coming down, you see Fed Fund Futures going up. That's your Fed put in action. And has the S&P only climbed a little bit and went sideways, Fed Fund Futures once again, the last several sessions have been moving higher. Listen, I don't know how all this is going to turn out, but I could tell you whether you're monitoring inflows the equity ETFs or monitoring what's going on with the relationship with rates, fed funds, and equities, it certainly seems to me that many investors are so much more comfortable with the uncertainty than many that report on the uncertainty. And I think Kilberg would totally agree with that statement. Back to you.

Calvesina. I love that. Let's go back. He's the smart guy in the room, Sully. He's the smart guy in the room. It goes back to the 1990s. I used to watch the Rickster when he was running the Sandwood desk, lobbing in trades in the bond pit. But he's absolutely right. Look at the bond yields in the 10 year. For the last month of all that March madness we saw in equities, the bond yields really moved plus or minus 10 basis points. So that calmness actually could be potential optimism for the overall equity market. Lori could lower interest rates. If we get them, we don't know. The bond market, been doing something different than the Fed.

has been saying, if we get lower rates, does that change how you perceive your S&P target, for example? So it impacts our valuation model primarily. What I would say generally, and we started focusing on this maybe about a month or so ago when the talk started to be that Treasury was really going to focus on pushing 10-year yields lower. We looked at it, and if you get lower yields and lower GDP in the same quarter, you typically see the market sell off pretty hard. So what we think it was a good reminder of is the idea that what goes on economically and the reason why yields may be moving does end up mattering. You know, if I kind of go back to my own modeling, if you push 10-year yields lower,

it pushes valuation multiples up on the S&P 500, so that's a positive. But again, we have to kind of go and look at what's happening underneath the surface. And if we take GDP forecasts down, for example, that flows through in a negative weight our earnings model. So there are puts and takes. But you're still, even with a S&P cut, you're still above where you were. I mean, you're bringing it down from 66 to 6,600. I got a D-minus and third grade math, but 6200 is still above where we are right now.

Yeah, so we've got a 6,200 target on the end of the year. You know, we assume with that pricing that the market low from mid-March is going to hold. Now, I would tell you, our confidence around that is not as high as I would like it to be. So we have been watching a bear case as well for 550. And if you... That's a new sound effect that we have. Whenever somebody cuts their price target, we should run. that sound.

Whatever that was. I felt like I was on the prices, right? That was amazing. Kilberg, was that you? It was me. I got a lot of people coming at me right now. Terrace are hot. That was your ring tone?

That's like a text tone? That was the bat phone. I thought that was a price target cut alert. If you're on the radio, you're like, something just happened. You get the point, though, Jeff. I mean, Lori is less optimistic than she was, and you could still take it down again, correct? Yeah, we've said basically, If the market holds in here, and we think this is really crucial for determining market sentiment,

if we break too far below that March low, you know, by like a percent or so, right, like it doesn't have to be an infantismal amount. But we're going to start to worry that markets are pricing and a growth scare. We're not in the recession camp, but if you look back historically between the GFC and COVID, we had a bunch of these growth scares in kind of the 14 to 20 percent drawdown range where people feared a recession or big crisis but didn't happen. And Jeff, you're very good at the – we're all of a certain age here. Let's be polite.

through a lot. And so you have a good way of sort of saying, you know, listen, we don't know where we're going to go. Okay, the markets could fall another 20% for the next five years economic catastrophe. I have no idea. That's why we have people like you on. This is the fifth biggest decline for the S&P 500 in a year. It's the fifth biggest decline in a year. It certainly could get worse. But we've lived through a lot on your, on the Kilberg scale, how big are Are these tariffs potentially? Are they, they're not COVID big, right? In terms of the economy, the impact on the economy, where do they rank?

They're pretty low on the tone pole because I don't think the priority is there. I'm more focused to Lori's point. What does that GDP look like? And I think it's interesting is that if you look at that 10-year, no yields are coming down. We're talking about two to three interest rates. The Fed just put another little chewy kind of process in where they're not letting their balance sheet run off. The balance sheet, historically, it's hard to really kind of compare. slowing growth and lowering yields because we've never had a balance sheet as large as we've had.

So I guess I'm just more optimistic because I've seen scenarios. We have not seen exactly this scenario. But when you see this souring sentiment, this political influence, I think it really provides an opportunity. And DeLore's point at 6200 under her new target, that's actually a new all-time high in the S&P 500. I believe if we do hit that 6200, you're going to see a lot of underinvested folks and we're going to see her go back to her original target of 6,600. So I just just look through the lens solely that we've been here before. It doesn't feel good. This is where you have to reallocate. You have to get out the shopping list and really be positioned because things are going to happen so much more acutely and all these algorithmic trading programs

that brought us down here in the SB 500. They can bring us right back up. Final positive comment, Lori? Well, so, look, I think he just gave you some love. I think he did. Look, I do think it's early in the year, right? And I think that's what's challenging. And we know that as fast as things move on the downside, they can move on the upside. If you look, at sentiment on the AAI survey. It's down around GFC in 2020 lows. That's the best reason to try to be optimistic in here right now. But I would push back a little bit on something that was said earlier. I don't think that companies generally have done the work yet of putting tariffs

into their earnings estimates yet. I've been spending a lot of time with my consumer analysts, and this is something they've been very focused on, that they've just not been getting good color from their companies. And frankly, the companies don't even know what color to give when we don't have final rules and regulations in place. I think you just defined uncertainty. It's also uncertain why Kilberg has that ringtone. Jeff Kilberg, thank you very much. And Jeff will see in a few minutes on Market Navigator and Lori Calvacina.

Thank you. And we are just getting started. Dan on deck, if you wanted a totally different investing idea, we're going to show you an ETF built around corporate competition. That's next. All right, welcome back. I think the previous segment said it best. Let's be crystal clear around the potential tariffs, and they still are potential tariffs. Nobody really knows exactly what's going to happen.

But one thing is clear. If they are enacted and if they are enforced, costs are likely to rise, particularly for specific companies in specific industries. Every analyst on Wall Street right now is trying to figure this out, and maybe every CEO as well. Even one Elon Musk, take Tesla, for an example. In a response to a tweet about tariffs last week, must grow back, quote, important to note that Tesla is not unscathed here. The tariff impact on Tesla is still significant, end quote. So all everyone is trying to figure out exactly what's going on, your next guest has a rather creative way to play the potential tariff trade, whatever happens. Joining us out of talk about this is the co-founder and CEO of Defiance, ETF's Sylvia Jablonsky.

Sylvia, what is that way? Hi, Brian. Well, I think, you know, with Elon, the opportunity is here, the opportunity here is just around momentum trading, right? So this is for the traders that are diehard Tesla fans. And they think that over the long term, the technology, the leadership, you know, the FSD potential, self-driving cars, all of this type of tech opportunity that lies within Tesla, the company, lies within Elon, is going to be the old guard, you know, kind of the old leadership in company. in the auto industry. So that's really what we do here. We kind of take the new guard, high-tech versus the older way of thinking, you know, within the automobile space. You know, I love being able, I mean, do you see our companies want to Comcast? You know, there's chill where you're long and Netflix and short Comcast, I think, is the pair trade. Where are you going with us? I'm saying, Comcast and chill? No, well, you should. But Sylvia, here's the thing. As fun as they are for us to cover and to use as like a story,

these are usually terrible investment products. They just degrade over time. Isn't the Elon one down like 70% since inception? Yeah, I mean, but since inception is pretty much since Tesla has been down, right? So if you look at Tesla in 2024, when it was up over 60%, I mean, this ETF would have absolutely knocked it out of the park that year, right? And here we are up off of the March 11th, up 20% over the March 11th lows, but the stock is still down 30% years to date.

So to your point, the trade's not working. But, you know, when do you get into trades like this? Like, when do you get into a Tesla if you're a dip buyer? Probably, you know, now, right? When it's down towards that 200-day moving average and, you know, kind of breaking its way out of that March 11th low, it's kind of what investors do here. You've got Amazon versus Macy's. And the tickers in here are also quite humorous with ticker Bezo. Coin versus WFC, RIPB, you know, it's like a little puzzle in all these.

Is one of these with micro strategy also? I mean, that's like leverage. on top of leverage, on top of, I don't even know what. Yeah, so, you know, there are all different ways to do this in terms of the battle shares. I think what we're going to do is let the investor and let the market tell us what they want to see. There's so many different and creative pairs that you can think about here. So this is a really new concept that we're bringing to the market. You know, you can think about this in so many different ways.

And I think, again, like, we'll wait and see what happens with the market and let the market dictate what we do. And, you know, I just heard your last guest talking about the S&P 500, where we think the year, will end. You know, if S&P 500 is over 6,000 this year, Tesla's going to be a big participator in that, right? And this trade is going to work. If it's not, then investors have things like XMAG where they can look at the, you know, S&P 500 minus the top seven stocks and not, you know, add exposure to the mag seven, but add exposure to the next seven and 493 after that that are actually all positive for the year. So there's different ways to trade and, you know, short-term investors might want to look at that X-Mag. Longer-term investors might love the battle

between Elon and Ford. Right. Are you, how frequently are you going to keep launching ETFs in this series? I think, you know, they'll be launched as frequently as the market tells us that they have appetite for them and they like them. To your point, you know, we fully acknowledge that not every trade that you put out there works. And, you know, so we'll kind of see how it goes. But we have a lot of great ideas around this and different types of battles and different creative ways to present the battles. And, you know, we'll be bringing those to the market as we see interest for them. Today would, you'd want like a tariff, some sort of tariff war.

I don't know if it would be like, you guys are more clever than I am. But those kinds of products or something about this shift to value and defensives or quality. I don't know. That feels like where the market's attention is at. Yeah, you can do all sorts of stuff like that, like growth versus value, you know, small cap, large cap, domestic international artists of things like that. But I think the tariff is an interesting play too. You can also look at Elon as the Maga trade, right?

Are you kind of like Eon might be long MAGA, right? Or where he might be a beneficiary from tariffs. Granted, they will affect Tesla, as he said in his tweet, but they do have factories in Austin and they do a lot of, you know, the FSD work here in the States. So maybe in that sense, they are better off than the classic American automaker that, you know, is actually building offshore and is exporting offshore and things like this. So there's different ways to think about these trades too. Yeah. Is the MAGA ticker up for grabs?

because that could advise a whole. You know, you have Newsmax is at like 200. I could do Newsmax versus the New York Times. You have the New York Times versus Google, of course, from a different point of view. But, oh, no, MAGA is the Point Bridge America First ETF. So that one's already taken. That exists.

We have some other kickers. We're pretty clever with that. Yes, you are. Sylvia, thanks for joining us today. Thank you for having. Sylvia Jablonski with Defiance ETFs. Could have an ETF based on your shremper? That's right.

The AC. AC, he would probably love that. He was the best. He's like, well, let me. explain. Well, when people heard about the imported steroids, that caused some attention. That scared me. When he said that at the end of the interview, like, well, Steve, I haven't answered.

A bunch of filth in the shrimp that you're getting overseas. I thought, well, maybe I better buy American after all. Up next we'll do needs versus wants. Investors seeing a split in the consumer space, market navigator, we'll tackle that. Stay with us. All right, let's get a quick check in the markets. We are now negative. We were positive earlier today.

Yesterday we were negative. Then we turned mostly positive. today we are positive, then we turn mostly negative. If you follow that, the Dow is down 277. Some of the losses accelerating a little bit. NASDAQ is down two-tenths of 1%. So Dom Chu, we talked about it earlier, uncertainty, volatility. Those do appear to be the watchwords, but for now, the other watchword is Navigator.

It is. We're going to navigate through the worst performing sector in the entire S&P 500. That's the consumer discretionary side of things. So far this year, it's been terrible. And at first glance, you might think it has. most to be concerned about when it comes to things like tariffs, especially for some of those car companies and other consumer-focused names. But our next guest says, once we get some more clarity on President Trump's tariff policies, if the tariffs end up being less bite than expected,

that sector could actually overcome what he calls the tariff tantrum that's happening right now and make a decent comeback. So we're going to turn back now to Jeff Kilberg, the founder and CEO over at KKM Financial. And Jeff, I know that this consumer discretionary trade is one that is overwhelmingly tilted from a mathematical standpoint towards Amazon and Tesla. But it's not just about that particular set of names. It is also about the move in consumer discretionary overall. Why do you think it bounces? Well, I believe, Dom, that we are going to have better than expected, or I should say, I think more fear has been priced in to the overall marketplace. And if you look at from a sector dispersion perspective, once again in 2025, we've seen great sector dispersion. We're seeing technology down a

but it's a close second to consumer's discretionary. And to your point, XLY is heavily weighted in Amazon and Tesla, but also has McDonald's and their Home Depot and booking. So those top five names which represent more than 50% of the portfolio have the ability to really snap back. Think about a rubber band in Tesla or even Amazon, which is down. All of those top five holdings, except for McDonald's, are down here to date.

So I am in the camp that President Trump is used as a negotiating tactic. He may even throw a caveat on tomorrow saying that they have X amount of time for these tariffs. So there's going to be a couple of curveballs tomorrow. I know we're seeing the market oscillate right here around $5,600 and the S&P 500, but XLY has the ability to snap back if I'm right. All right. So if you are right, hypothetically, how exactly do you express that view, Jeff? Do you use it with the options market? Do you kind of play the individual names? And what exactly is the trade set up for you? Well, that's the beauty of options, Dom. And that's where I want to be a call buyer. I wanted to

find my risk because if I'm wrong on the tariffs, we're going to see the market move lower and XOI will continue its dissent. But I want to be a buyer and I bought on the open this more. I know we're a couple dollars higher in XLY. XLI was actually up at 201 just about an hour ago, but I bought the 200 calls expiring at the end of April, April 25th. I paid about $4.50 for those calls. They're trading about $5.30 right now. But it gives me the opportunity to break even if XLY goes above 204.50. If it reclaims that moving average and goes up and tests the moving average of the 50 day in XLY 215, that's where there's unlimited upside. But in options, you have the ability to define your risk. So by defining what I'm paying for these calls, if we do see XY go down,

I'm not going to lose money like I would if I actually own XLY in the underlying ETO. All right. One contract worth 100 shares, so $4.50 turns to 450 for possibly unlimited if it goes above 20450. Jeff Kilberg, thank you very much for the trade on consumer discretionary. We'll see you again soon, sir. See you, pal. So super plain, lame in English. What is Jeff betting on? Jeff is betting on upside in the consumer discretionary sector ETF, ticker XLY. It's right around 200 right now. If it goes above 204.50, that option starts to make money, unlimited money if it keeps going higher. But it has to go above 204.50. To break even. But if it goes lower, all you miss out on is the $4.5.5.

and 50 cents per share you paid for the option overall. Thank you. There you go. Thank you. Thank you both. The airlines are closing out a rough March. United having its worst months since the pandemic. Will declines in the travel space continue if global trade war kicks off?

We'll explore that next. Welcome back to Power Lunch. I'm Courtney Reagan with your CNBC News Update. The defense team for Luigi Mangione called an attorney, Attorney General Pam Bondi's call for the death penalty day. A move from the dysfunctional to the barbaric. They called Bondi's decision to direct federal. prosecutors to seek capital punishment in the killing of United Healthcare CEO Brian Thompson, a political move. Bondi said the shooting was a cold-blooded assassination. The Trump administration

admitted it had mistakenly deported a Maryland man to El Salvador because of an administrative error. A 29-year-old had protected legal status. The White House said this afternoon the administration maintains he was a member of the MS-13 gang and involved in human trafficking. Princeton University said today the Trump administration pulled several federal research grants, from the institution. Princeton's president says the rationale was not fully clear, but it comes after fellow Ivy League school, Columbia, agreed to several demands from the federal government after it pulled millions of dollars in funding over its response to anti-Semitism on campus. Kelly, back over to you. And now Princeton. Courtney thanks. Courtney Reagan. Let's get to one of the big

calls of the day on the street. Jeffrey's downgrading Delta and American to hold, knocking Southwest to underperform and cutting its price target by almost 50% on United, although it's still a buy rating on that one. They say the consumer sentiment is at a four-year low and the potential tariffs have already hampered business confidence. You can see here that a couple of the airlines are among the biggest losers of the day in the S&P. And take a look at the travel stocks not faring much better on concerns about Europeans and Canadians reducing travel to the United States. Our next guest thinks escalating trade tensions may be creating some isolationist behavior among travelers. joining us now as Barclays analyst Trevor Young. Trevor, it's good to see you. So how much of an impact is from tourism? How much is American kind of consumer slowing down a bit? What do you see?

Yeah, thanks for having me. So we actually see a variety of factors contributing to what we consider a slowdown and travel demand right now. Obviously, trade uncertainty is weighing on consumer sentiment. Hopefully we get some transparency on that tomorrow and in the coming weeks. But at the end of the day, travel is consumer discretionary spend. And when people see capital market, volatility, trade uncertainty, they tend to pull back in discretionary areas like travel. And we do think that's happening right now. Which is interesting. We spoke to a Norwegian cruise lines analyst who said cruising was relatively recession-proof in 2008 and 2001 and that that could be a safer place to look this time around. I don't know if you have an opinion on that. But I guess the larger

question is, what is travel telling us? And is it a leading indicator? Or could it recover after we get through this tariff uncertainty? Sure. So my coverage specifically is on the internet name, so like booking holdings, Airbnb, and Expedia. So I'll focus on those. And we do think it is a little bit of a leading indicator, but to your comment a moment ago,

you know, we do think actually we should wait and see how 1Q shapes up. One Q is a key quarter for bookings. That's typically when consumers, you know, start planning their summer travel. So as we start getting into 1Q results into April and early May, that'll be really indicative of how,

consumer demand is shaping up for the rest of the year. So Expedia booking Airbnb trip, anything that you can glean from following what's happening there? Yeah, sure. So we do think that, you know, US exposed names and airfare exposed names may have a tougher time for some of the reasons you mentioned before. So that would be more of an impact zone for a name like Expedia, whereas booking holding is much more Europe focused. 40 to 50% of their bookings come from Emia region and they have lesser airfare exposure, it's only about 15% of their bookings per our estimation, whereas Expedia is more like 25% from airfare. So there's certainly some geomix and product mix considerations here, and we do favor booking over Expedia. Trevor, what's going on with the airlines? I mean,

they had this monster 2024. United Airlines doubled. Now it's down whatever 30% in 2025. These are not airline-like moves. Yeah, so I'm not the airline analyst, so I'll shy away from answering, you know, specific to those names. How about this? What's going on with travel stocks? How about that? Sure. Because I could have thrown cruise lines in there as well.

Yeah. So, look, last year, we, particularly in the back half of the year, we saw surprising resilience and travel demand after what we would consider kind of a growth scare in that July, August, time frame. And that just proved short-lived. And we could be going through a similar kind of growth scare right. now. It's too early to make that call. It's something we're very cognizant of. But this is pro-cyclical industry. This is consumer discretionary spend. And in tougher times, this is where

consumer pulls back. All right. Trevor, thanks. Appreciate you joining us today. Great. Thank you. Trevor Young of Barclays. All right. On deck, more on the markets and your money as stock struggle. They're now all the major indexes are red. They were in the green earlier. We'll give you the latest trade. Plus, if you're out West, come on. The CNBC change, make. Summit is in Los Angeles next week, April 8th. Still tickets available. Go to CnBC Events.com slash change maker. All right, the media, we love to talk about the media.

But this is an incredible. Kelly, you pointed this out yesterday. You pointed this out. Well, we're both pointing this out. Everyone's pointing out. Everybody, because in our industry, the media is, eh. We're watching Newsmax, okay. Newsmax, the TV channel, sort of right, far right leaning, whatever you want to call it.

IPOed yesterday. The stock's up another $122 today. It IPOed at $10. It closed yesterday at $83. It's at $203 right now. The market cap of Newsmax is now the same as all of Warner Brothers Discovery, which, to be fair, has a lot of debt. So that brings down the market cap. And News Corp, and Thomas Pederfee, who is the number two holder, has now a $5 billion stake in Newsmax. I will just add, if it stays at this price, okay? Because whoever is buying it right now, if you're predicating this on it, you know, going up two or three X again from here or whatever, we've seen a lot of these companies rocket hire, which it's doing, and congratulations Newsmax.

Now we have to see what happens next in this story. So, yes, snapshot as of today, billions of dollars on the table. But again, this is what an 80 million revenue company, as Dan Premack told us the other day, So we have to see what happens. So it's got a $25 billion market cap, and it has $80 million in revenue. Yes. And now, look, it's only about a decade old. So even to just come on the scene in the way that they have with obviously a lot of the Trump

meme stock mania behind them, kudos to them. However, the financials certainly do not support that valuation and we'll have to see training wise. You want to see any sort of media company do well. But just keep in mind, folks, that we've seen. to Kelly's point, we've seen a lot of media stocks have, let's just call it, very volatile moves. Yeah, meme mania.

We all know, it's like you've got to tighten your seatbelt, everybody. Fat, buckle up. Our trader has three names to help you weather the market's trade tariff turmoil. We will have three stock lunch next. Dow's down 261. Okay, 170 million for new smacks and revenue, okay? 80 million in earnings. 170 revenue.

That's right. 80 earnings. Yes. $25 billion. dollar cap. Yes. And three lades, maids a leaping. Three lords a leap. The lords left. That's it. Let's do some three stock lunch today, hitting three stocks that could ride out the tariff turmoil. Quint Taitro is here with our trades. He's the founder and president of Jewel Financial. Quinn, let's start with Alibaba. That's your first pick.

And I'd love to know why and what you do with it. It's actually a 50% year to date. Yeah, sure, Kelly. Thanks for having me back. First of all, if you want to avoid the tariffs, you can avoid them very easily by just going abroad. And Alibaba is a great example of that. This is a company where 80 to 90% of the revenue comes from within China. It's estimated that less than 5% comes from the United States. So they'll really be isolated from any tariff talk. Now, from a fundamental perspective, this is an unbelievable stock here,

trading 13 times forward earnings. They've got basically $50 billion in new AI investments that they're making. So they're in that sector. they have $67 billion in cash, and they're only trading two-time sales. So despite the run-up that we've seen in Alibaba of late, we're still a buyer here, and it's a great way to avoid the tariff tantrum that we're seeing in other sectors. Quint, are you also hiding out in oil because I notice ExxonMobil is your next stock? Yeah, again, another great place, right?

I mean, oil should not have any issues, especially the domestic major integrated oils. Exxon's a great play for that. You know, we do believe that even though the administration is going for lower energy prices, we think the deregulation will offset that. But this is also a fundamental champ. I mean, it is also trading 13 times forward. And the earnings estimates are for 18% growth next year. Very little debt, $20 billion in cash.

And you get a 3.4% dividend while you wait. The company or the stock hasn't really done anything in the last two years. And it's just starting to get traction. we think it goes higher here. I haven't heard that pick in a long time. All right, let's move on to Snowflake. That's not selling off. The shares are a little bit positive today, though,

but it's down about 4% since the start of the year. Why Snowflake? Kelly, I'm going to keep coming back with this one. And this is, I think, a classic throwing the baby out with the bathwater. I mean, this is a stock that's getting pin action off of all the other tech and semis and AI trades. And this is a name that is a software application company. First of all, there's no issue. with tariffs here. I mean, they deal with data in the cloud, maybe some, some, you know,

opportunity for tariffs if their customers get hit and see raising prices. But this is a company that takes data for their customer set, helps them manage and use that data in a more efficient manner to save them money. So in an environment, when they're getting squeezed, I think this snowflake business will be ramping in this environment. And I've talked about this before. From a fundamental perspective, it does not look cheap. It's trading at a rich valuation, but we feel the estimates are very low. A $1.59 for this year, full year, we think is too low for this company. And this stock, we believe, is a great buying opportunity on this pullback. Quint, we appreciate it today. Quint with the Trace for three stock lunch. And remember,

you can recap every single segment. Anytime you want, just scan that QR code on your screen or head to CNBC.com for more. And we'll be right back. All right, coming up, the NFL out with a big announcement that could change your Christmas. Well, apparently the NFL's Christmas Day experiment was success. So pro football did what many other companies do. They take something that was success and then they just milk the heck out of it. The NFL announcing there will now be three football games on Christmas Day. Hey, who needs family time and Santa when you have football?

We also have CNBC Sports and Media Reporter Alex Sherman, who has mysteriously replaced Kelly Evans. Three, that's a lot. But it's NFL. Can you blame them? There is no organization that I know of better than milking every cent out of the dollar than the NFL. They are the king at carving up media rights in as many possible ways. Like a Christmas goose. I mean, all you need to do is think about the various different services now that has NFL games.

I can't. There's too many. There's too many of them. So the Christmas games, the first two, will appear on Netflix. The third will appear on Amazon. That works out nicely. So none of the three Christmas Day games will be on what we call in business linear television. So Christmas falls on a Thursday this year. You can check your calendar.

And Amazon already has the rights to Thursday night football. So they will get their one Thursday game. Plus the two Christmas games that were promised to Netflix last year. And there's one more year on that deal. So those three games, all streaming services, in addition, of course, to all of the broadcast networks that already have football. I'm going to say this for my parents who I love very much. Dad and mom, dad, this means if you don't have Netflix or Amazon, you cannot watch football on Christmas Day. Right.

Now, they'll be at my house because we love them. Exactly. But if you don't have those services, you do not have football on Christmas Day. Right. So there are sometimes local provisions where you can still get your. game locally if you happen to live in one of those markets because there are blackout provisions where they will make the game available. Do we know who's playing? By and large, you are correct. If you are in the national audience, you need to subscribe to one of those services to watch the games.

We do not know who's playing yet. The schedule comes out later this season. It's going to be the Jets versus the Pittsburgh Aaron Rogers. I mean, the game, the Christmas games were quite good last year. So I think the league, the NFL, very much would like Netflix to be. be one of its main partners moving forward. So it may give them some, on paper, good games. Now, Christmas has always meant basketball. Yes. This is like a... So what is basketball still, are they now competing with each other? They are. Very much so. That's not going to go well for basketball. This is the Battle of the Titans. You're right. We already saw it last year. The ratings for Netflix were so good that they were actually better than playoff games that were purely streaming games.

That's how many people tuned in to watch the Christmas games last year. on Netflix. So now it is head-to-head against basketball. This is a full-on takeover of Christmas, the NFL trying to push the NBA out. And like you said, there's no question that the NFL is going to win that battle. The NFL is America's sport. It's not baseball. It's not baseball. I know. But again, yes, and I know pretty much everybody has Amazon Prime. Do they watch Prime video, though? Netflix, so do you think there will be a push for, will Netflix win? Will Netflix win Because of this, or does everybody already have Netflix? Netflix is winning.

And media reporter. Netflix is already winning. They are the dominant streaming service out there. Almost, I mean, this is what, it's 70, 80 million Americans have Netflix already. So it's kind of part of their lives. And the audience for these games was so strong last year on Netflix and was so strong for that Tyson-Paul fight that you know they can succeed with life. By the way, really enjoyed C-B-C Sport. Yes.

Good job this weekend. Alex Sherman, thank you. Thanks for watching. Power Lunch, everybody. Closing bells start playing.