Nvidia’s Post Earnings Blues… And JPMorgan CEO Jamie Dimon’s Bond Market Warning 5/30/25

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Live from the Nasdaq market site in the heart of New York City's Times Square, this is Fast Money. Here's what's on tap tonight. Out of steam, shares of NVIDIA nearly giving back all their post-earnings gains. Why couldn't the chip giant turn things around with the rest of the market? We'll debate that.

The S&P and Nasdaq looking to their best months since November 2023. But will the summer months be just as sunny? And how will next week's jobs report factor in? We'll get some answers. Plus, Alta shares.

get a glow up after earnings. Netflix scored two big bullish calls from Wall Street and a literal buzzkill. Why booze stocks have been under pressure and how to trade the names. I'm Melissa Lee, coming to you live from Studio B at the NASDAQ. On the desk tonight, Tim Seymour, Karen Feinerman, Courtney Garcia, and...

I'm Steve Grosso. We start off with the latest developments on the U.S.-China trade tensions. China stocks falling amid reports that the Trump administration is planning wider sanctions on the country's technology sector. Megan Cassell is at the White House with the very latest on this. Megan.

Hey, Melissa, some back and forth between the U.S. and China today. Some harsh words on both sides. But that headline you mentioned coming from Bloomberg about midday, reporting that the administration is looking at expanding restrictions on China with new regulations that would capture this.

subsidiaries of companies that already face sanctions. So the idea here, they say this is a draft rule that's currently being considered. And the idea is if you take a company like Huawei that's already subject to US sanctions, if Huawei becomes the majority owner in a subsidiary company,

that subsidiary would also be subject to the same sanctions. It's meant to stop this sort of workaround that companies have been using to try to avoid some of these restrictions. So that put some pressure on shares, especially because it came after sort of this back.

and forth, starting with the president this morning, saying that China had violated aspects of the trade truce that was struck in Geneva just a few weeks ago. China then firing back and saying that actually it was the U.S. that was the one that was breaking the deal here.

and some questions when I was at the White House earlier about whether this might lead to further action from the administration ratcheting up some of their moves towards China. But when the president was asked about China in the Oval Office mid-afternoon, he sort of downplayed things.

He said, yes, that China did violate a big part of the agreement, but he went on to say that he's sure that he will speak to Chinese President Xi Jinping and that, quote, hopefully we will work that out. So, Melissa, no call scheduled between the two leaders that could. be the next step. But for now, the president's still seeming optimistic that they can work on some sort of deal.

Megan, were there any specifics on how exactly China was violating that agreement made in Switzerland? Did this have to do with critical minerals, which U.S. Trade Representative Greer made reference to this morning? That's exactly right. When Greer was on Squawk Box, he talked about those critical minerals. And the idea was that in this agreement in Geneva, China was meant to soften its export controls to allow the flow of critical minerals to the U.S. But remember, there was no timeline.

attached to that aspect of it. The Wall Street Journal had some good reporting just in the last couple of hours that that piece of the agreement was really hard fought in Geneva, that it came along just at the end, and that it was crucial to the two sides both agreeing to lower their tariffs.

The US now feels that China has been slow walking that and not doing enough. So that is at the center of this here. I don't think it's the only tension. We also have these fights over semiconductor export controls, of course, and student visas, among other things. So a lot of tensions, but the critical minerals really do seem to be at the heart of it.

All right, Megan, thank you. Megan Casella. And this all comes on today when we saw a sharp reversal in shares of NVIDIA, the chip giant dropping almost 3%, nearly erasing all its post-earnings gains. The stock unable to bounce off session lows, like most of the so-called MAG7 stocks. It is now up just half a percent.

percent this year, still more than 11 percent off the record high hit in January. So what does this tell you about the world's biggest chip stock that didn't participate in the rebound, especially as we do seem to have trade tensions ratcheting higher?

Well, it participated when I thought the market was reacting to the fundamentals of the release. I think the market got tired today. I mean, again, this was the best May. I think I had it the best May since 2000, up 6 percent. It wasn't a sell and may go away. It's a place where I think.

Nvidia's largely rocketed back to where it belongs. It gave a little bit back here. But what we heard from the company, I think, reiterates the dynamic that Blackwell's second half of the year, the production that we needed, supply chains eased up, and we heard no sign of a...

delay in demand. And I guess, you know, I think about the week that was also when we heard from a couple retailers gap today. We heard it from Best Buy. I mean, there are impacts already in the retail world. The consumer has proven resilient. We've also heard that I this felt like a week. If I had to characterize it as anything, I think rates ground lower.

Val ground lower we're getting through earnings season and there's a you know always a new headline every day on trade that I think the market started to become more in me or two

So I think NVIDIA, a lot of it was, I mean, look at how low it got in the low 90s, right? So for NVIDIA to move more than 50% is an extraordinary move into earnings. So we've seen how hard it is to go into big earnings and no matter what you put up that sometimes it is enough it was enough for one day i think that rising china tensions you know with so much focus on jensen's talking about how important china is to their business and

to the AI sort of us leading the AI technology around the world. So this, I don't know, I think it was a little bit ahead of itself. I don't look at it as a structural problem there. And the whole market has had a huge run.

Yeah, and I agree. I wouldn't say it's a structural problem. And I think realistically, they did so well with earnings in spite of the fact that they have all these headlines with China. And then today you get some increased rhetoric again. There might still be some issues with China. And I think yesterday there was.

some optimism that, OK, maybe these tariffs weren't legal or they weren't going to go through. There's a legal pushback. But now you're seeing that again. So I think some of that's putting pressure on Nvidia after this really good earnings release. But I don't think it's anything I would be concerned about just with some of those headlines. I think your peak.

Nvidia bullishness. You would be hard-pressed to find anything more bullish that's coming down the pike for Nvidia. To Karen's point, you had that run from 90 all the way back up to 142. That's a lot locked and loaded for what's coming down the pike. Think about all the competition. AMD, Google, things that you don't, the hyperscalers are actually the competition because Meta is coming up with their own chip. Google is coming up with their own chip.

Amazon their own chip. So I don't see anything tremendously bullish going forward. The stock is sort of range bound right now. Ninety one forty five. You don't think that there's going to be another deal signed with, you know, Saudi Arabia or some party in the Middle East, sovereign AI, for instance?

or some sort of, you know, being an exemption in the chip export restrictions. I mean, all those things could be massively bullish. Massively, and I think that's why it ran to 140 and change. I think that was all factored in. I think that was the pop-off of this. the $90 level. And if we're treating this like a trading show, not an investing show, I think you have to sell your Nvidia at this level and wait till it round trips, wait till it gets back down to 100 or so.

I'm not sure what took it back down to the 90s is going to happen again. I mean, really, we're at the worst of trade rhetoric. I think sentiment on NVIDIA is hardly bullish here. I think it's been kind of a proven story. I understand it's come back.

And I understand what they delivered yesterday was reassurance. And that should give a lot of confidence. I mean, there was no sign of weakness. And yes, gen sanity does seem to be alive and well. And yes, there are alternative export markets. And there is this sovereign AI market. And I think it's very.

important because nowhere have I heard of a fall off in demand. And then I would just take it back to evaluation at a time when we're questioning the valuation of the S&P. This is not a place where, I mean, you know, I don't think so. Not on the next couple of years forward.

We all know the growth isn't going to be there. So, you know, I hear you, Steve. I mean, it's hard to see a stock that moves from 90 to 140 hasn't had a big run. But I think the sentiment and I think the positioning of the company is important. I think they still could have.

Very good growth. I mean, we'd always talk about, you know, the cloud service providers, then we talk about Sovereign. But when you look at Dell, they talk about cloud service providers are 50% of their business, on-prem and companies, right? We don't even talk about that is 40%. and sovereigns 10 so that 40 is growing a lot and and we usually just think about how much are the you know the big three or four whoever it is core weave microsoft meta google and amazon how much they're spending

But there's a whole other giant section that's growing really fast. Just think about the four top clients for... Nvidia account for 40% of their revenues. And those are the clients that I hear what you're saying. There's replacement, whether it's going to be a sovereign angle to be replacing. But you still have four clients that I don't think are going to be buying as much or as much at this level of cost.

But let me throw the trading aspect back at you. You said, okay, if this is a trading show, you've got to take profits. I get that. But at the same time, what you're talking about is something that happens... not next quarter, not the quarter after, maybe not even the quarter after or the quarter after. I mean, in terms of replacing NVIDIA or sizable amount of NVIDIA GPUs with in-house GPUs.

That's something to happen over time. I agree with that. Can't argue with that at all. But what does the market do? It's a forward pricing mechanism. The market's usually... probably pulls forward six to nine months. So plenty of times you look on a chart and then you get to the actual event. You think, oh.

that's why it sold off 30%. It's a forward-looking mechanism. Well, I think your point on AMD is a good one, which is also the A in band, by the way, or bland, depending on how good I feel about Lyft that day. I mean, I just, I think there's a case here.

to be made for AMD picking up the pace and what we've heard in terms of their ability to deliver a chip that also people were questioning about. I think in a world where if anything, deep seek has made the playing field more level for other players and also shown that it doesn't have.

to be Blackwell all the time. All right. Meantime, another potential headwind for big tech. Germany considering a 10% digital services tax for large online platforms. Meta and Google among the names that could be most heavily impacted. For more, let's bring in fast... Money Friend and Deepwater Asset Management Managing Partner, Gene Munster. Gene, always good to see you. Hello.

So how big of an impact is this? As I understand it, other countries already have a digital services tact and Germany is sort of joining in on the party at this point. Correct Melissa, it's about two to five percent for a dozen or so countries. So Germany has not have one. So a little bit late to the game. But the news here is that the size of it is a step function bigger. It's a 10 percent.

digital tax it's also on revenue and that's important because typically you pay taxes on earnings but in this case it is an impact to revenue so think of this effectively as uh you know the impact if it was like a tax rate it would be about double that number talking about like a 20 number and so that's one piece that kind of sticks out a second is this

Rift this continued friction between US tech in Europe and we saw it with GDRP the Digital Management Act and now we're seeing it with this digital service tax and I think what is ultimately at play here is kind of the sense that some of these countries feel like an injustice and in the case of many of the countries

the europeans especially they don't get the benefit of a lot of the taxes because most of those funnel through ireland as you know it's just an awesome tax shelter for big tech and they're typically paying like a 12% tax rate and so The news here is that just the size of what Germany is talking about, and it kind of has some sounds, rhymes like what's going on with tariffs, too, is these big kind of step function numbers.

and it makes me wonder, is this just kind of all part of a trade negotiation? Hey, Gene, it's Karen. Yeah, that was sort of my... Question, which is, was that sort of a, you know, Liberation Day kind of, all right, throw it out there, 10% of revenue, but really we'd settle for five, or a percent of earnings. What would be a number that would be easily absorbable? for a meta and Amazon or Google rather.

So keep in mind, they're paying it today in many countries, kind of that two to 5%. And so I think that a number, the twos go up to fives and the five stays at fives. I think probably is something that investors largely would look past. The reason why the stocks didn't do as much today, didn't really react to the news is because I mentioned those other.

shots that EU has taken at big tech. And they have made changes to the business. I mean, these taxes have gone up for them. They have made changes to the business. GDRP impacts how Google can sell ads, how Facebook can track. but they just keep finding ways to continue to grow the business. And I think that to answer your question, how much would be absorbed from an investor perspective? I think they could probably take it up to 5%.

My guess is it is going to go up. I think that there's enough meat here and precedence that's already in place that you're probably going to see some adjustment higher. But my sense is investors will largely look the other way. Gene, when you look at the percent of revenue that comes from Germany for an alphabet, it's under 3%. And for a meta, it's just right at 3%.

is a lot of this us just you know digging through and i i get it the numbers the absolute numbers are big those numbers are 10 billion dollars but when we really look at it this doesn't change your thesis on these companies right It doesn't change the thesis. There is a piece to this. You're right on those percentage of revenue. There is a piece that the kind of governing body around these types of taxes isn't just a European, it doesn't just have European influence, it's global.

And so there is this risk that effectively they ratchet it up for just across the board. And if you wanna... take it to the most extreme level, you look at these three companies, two thirds of their revenue comes from outside of the US. And you could build a case where if it goes from two to a 5%, you get a 3% revenue hit, if all that makes sense. I agree it doesn't change the fundamental thesis of any of these companies.

But that's why this is worth attention, because it does have an effect of potentially impacting many companies beyond Germany and Europe.

So when we say that Germany is the one that's sort of late to the party in terms of any sort of digital services tax, is the real, I mean, it's surprising almost that the EU doesn't band together and say we... will all, or maybe this is going to happen at some point, we will all raise it to 10% because that will give the maximum leverage when it comes to an EU trade negotiation as opposed to Germany saying 10%.

Absolutely. I'm surprised that the fact that Germany kind of went at this alone, I would think that if this was part of more of a... an orchestrated tariff negotiation your prop would have maybe done something that was a little bit more organized and so

That does surprise me, but it's still on the table. And I think that, you know, they're probably, you know, they're going to float this out. They're going to see what the administration, the White House says about it. Germany is going to float it. They have floated it. And now they're going to see what the reaction is in Germans.

that European allies are going to, I'm sure, fast follow. Gene, to what extent are the Googles and the Metas of the world just going to be negotiating on their own? And in some sense... I kind of see this is where it's going. I mean, the revenue streams of these companies, they're like many sovereigns. And if you think about the influence they have in some countries, more important than others. So I'm tending to believe this is kind of no news.

because I think these companies are important. But I do think that ultimately the leverage lies in the sovereign. Just curious. But again, one on one bilateral. This is kind of the fallout from trade rancor everywhere. I think sometimes the U.S. government can get cut out of the middle. I think what we see over the last year, last six months, really since the election is a different answer today.

I think that just given how tech has been positioning around the White House, kind of the influence and the effort that you've seen from their leadership, there is this sense that the companies are negotiating along with the U.S. government. we're going to rewind back to six months ago a year ago i'd have absolutely agreed with you each of these companies for themselves and they have to fend and and debate them uh you know their position on their own merits but my sense is that they're

just seems to be bigger at play. Look no further than Jensen's comments last night. I mean, the White House has been having a big impact on his business, and he's spending a lot of time there to try to make sure that they're well aligned. Gene, always great to get your take. Thanks so much. Thank you. Gene Munster, Deepwater Asset Management. Courtney, does this change your thesis on these stocks?

You know, it doesn't change my thesis, but when you look at a lot of the Mag 7 or big tech companies, there are a lot of headwinds and the regulatory concerns have been one of them. And I think this is something where you've already seen a lot of regulation happening both in the U.S. but in Europe. And now you're seeing things like these taxes that are going on top of it.

And I don't think those are going to end in the near future. So you're looking at like some higher valuations. You're looking at some tariff exposure. This is just another one of those.

headwinds that I think is a big reason why you want to stay diversified. So I absolutely want to own these companies. You just don't want to be overexposed. And we find so many people are much more exposed than they have any idea. And we just really try to point that out. Yeah, it does seem that for years, years and years. The EU has been going after big tech in so many different ways. This is just another step. GDPR was going to be disastrous.

Not so much of an impact in the end. In the end. In the end. It was painful for a while. It was painful for a while. And now we're through it. Well through it. Yeah. They do. They have just they throw out. They know they can get a billion dollars for anything. Right. Right. Without even trying there. Yeah. Yeah. So I do think, though, for more for Google than Meta, there is a very large or two very large issues out there that.

are well bigger than this would be right it's the antitrust both antitrusts that's that's going to be the most important thing to happen to these talks in a while yeah yeah i i guess i just think about these companies in a place where really one of the other big themes of may was broadening of the market i i you know

We don't even need to go out there and say it was peak. It's peak mag seven because, you know, I think on some level, these kinds of skirmishes and dynamics around regulatory and change in some of the world tech order, I think it's obvious.

market is broadening. This is actually good news for investors. And I would also just say that the negotiation stance that this administration has had with China and even Russia, I think there's other parts of the world that are saying, you know, China's kind of gotten what they wanted so far. Russia's definitely gotten what they wanted so far. as well as well. I think this is healthy. They used to trade like a monolith and now you see

Microsoft up 9%, Meta up 11%. Google, to Karen's point, has a host of issues that they're facing, and that's why the stock is down 9% with an NVIDIA flat. So I think there's enough room to pick and choose which mega cap tech that you want.

much more healthy for the markets. All right. Coming up, no need to conceal. We are highlighting Alta's big jump after earnings in the profit primer. Oh, boy. Giving the stock a solid foundation. Oh, come on. Never ending. Friday, come on. And a radioactive trade.

portfolio nuclear stocks exploding this month thanks to the chain reaction from Trump's nuclear renaissance order the names powering the trade and whether the gains are sustainable don't go anywhere fast when he's back into This is Fast Money with Melissa Lee right here on CNBC. Need money for college? Down payment for a house? A nest egg? I started the club for you. The investing club is about allowing you to be in control of your own money.

We do something nobody else does. We tell you what we're going to do before we do it. We're not traders. We're about creating long-term value. You want to be a better investor? Join the club. Join the club and save at CNBC.com slash join Jim. Terms and restrictions apply.

Welcome back to Fast Money. No blemishes to cover up in Alta's latest quarter. That's a good one. Shares jumping nearly 12% as opposed to the other ones, which are marginal. Shares jumping nearly 12% on the back of yesterday's earnings. report. The beauty retailer topping top and bottom line estimates, raising its annual profit forecast, also saying lower inventory losses and new launches, especially of celebrity-owned brands, help drive demand.

at its stores. It was a very strong quarter. They're saying consumer spending really picked up in May. Yeah. Post all the tariff uncertainty. Traffic was great. I mean, this is Keisha Stillman, the CEO. She's been there, I don't know, 15 years, maybe. This is her second as CEO. This is a second. second great earnings. I mean, so many good things happened. Comps were great. The margins were good. When you have that top line growth, the margins are good. And then you leverage, you know, your SG&A.

You get great operating margins. That's happening. They took share in mass. They took share in prestige. I'm surprised they had the confidence to put out. You don't need to. right you don't need to forecast in this environment everybody sort of gets a pass and so they must feel awfully good all of that was great my only concern now is valuation right this is now a high teens multiple it hasn't been here in a while

Not quite sure what to do, but I mean, kudos to them. They did a fantastic job. I mean, analysts are saying that the raised guidance was actually cautious because of what the CFO said. They said, oh, it's a pretty dynamic environment in terms of consumer spending, what's going on with tariffs. So we thought we.

it'd be safer to take a cautious approach to guidance, which leads one to believe that the raised guidance may be a conservative raise. They have to feel very comfortable with that. Super confident, yeah.

Yeah, and I think it's great to see they're actually taking share from their obvious competitors like a Sephora, but even as Amazon or walmart starts to get more into beauty the fact that they're really able to continue that when you're ordering everything on amazon and walmart the fact they're still going to ulta is i think a really strong sign and the fact that consumer has still been picking up and you actually just saw this with the consumer sentiment numbers as people are

getting a lot less pessimistic about the economy. I don't know if they're optimistic yet, but definitely not as bad. But you are seeing that savings rates are going up. So people are still cautious on their spending, but they are still spending at Ulta. And I think that's actually a really positive sign. They have zero international exposure.

So I think that probably goes into a little bit of no headwinds for them of the current environment that we're in for the rest of the market. And if you go back to October 2023, stock was at 375, gapped up to 470-ish. in january of 2024 then it was a solid base and then it ran another 100 points higher so i think you're good here yeah

Yeah, I mean, Courtney's right. I mean, I'm getting my beauty at Walmart these days. It shows. Wow. I did set myself up for that one. You totally did. I was waiting for somebody to come in. It was intended to be. But part of what was interesting about...

this is the new brand launches and where they're incubating new brands. I mean, they are looking to stay on top. They're looking to stay in the lead. They're looking to actually have the margin associated with house brands. And I think that that's part of what works for the multiple. Given the move in the stock today, the multiple is actually north of 20 now. So it's not as bad.

No, a little higher. Oh, higher. Yesterday was 18 and change. Oh, I didn't realize that. But the stock moved up so much. A little uglier. Yes. Yeah, yeah. There's a lot more fast money to come. Here's what's coming up next. The chain reaction pushing the nuclear trade to new heights. More on the radioactive run and whether the gains in these names are sustainable. Plus, Jamie Dimon ringing some alarm bells. The cracks he sees in the bond market.

and the impact it could have on equities, the economy, and your money. You're watching Fast Money, live from the NASDAQ market site in Times Square. We're back right after this. Need money for college? Down payment for a house? A nest egg? I started the club for you. The investing club is about allowing you to be in control of your own money.

We do something nobody else does. We tell you what we're going to do before we do it. We're not traders. We're about creating long-term value. You want to be a better investor? Join the club. Join the club and save at CNBC.com slash join Jim. Terms and restrictions apply.

Welcome back to Fast Money. Uranium stocks closing out a massive month buoyed by the Trump administration's moves to boost a nuclear renaissance in the U.S., the URA ETF having its best month since 2020. But are these gains sustainable? Our Pippa Stevens has got more on this. Hey, Melissa. So the stocks did dip today, but still a big May for nuclear. First, the industry was a relative winner within energy from the House's reconciliation bill.

And then the White House has four executive orders aimed at quadrupling nuclear capacity by 2050, really turbocharged the rally. The NLR is having its best month on record and the URA gaining 27 percent, pacing for its best month since 2020. Now, retail investors also getting in on this trade, snapping up shares of the URA at the fastest rate since January. That's according to data from Vander Research. Small modular reactor companies Nuscale and Oklo, the biggest winners, up 93% and 120%.

22% respectively in May, begging the question of whether the stocks are simply now stretched, especially since neither company has actually built a reactor. Centris, another big winner this month, they're producing Halo for the Department of Energy, but not yet.

for commercial customers. So the market is clearly viewing the federal support as a positive, but as Think Tank Third Way put it, caution is warranted since the EOs will be nothing but talk if they aren't backed up by factors including real funding and robust staffing. Melissa? Pippa, for New Scale and Oak Low, neither have built reactors, but they do have contracts, right, to build reactors. So they are sort of...

you know, they have those revenues in the pipeline, so to speak. So they're in the works, but NuScale is definitely further ahead than Oklo here, because remember, NuScale is the only company that's had a small modular reactor approved by the NRC. That was back in 2020. And then actually this...

week. That was for 50 megawatts. This week, they got their reactor approved for an upsize to 77 megawatts. They had started construction on a project in Utah, but then that fell through as the costs rose. Oklo submitted an application with the NRC. for their Aurora reactor that was denied. They are now in talks once again with the NRC. They said that their application was denied because of issues during COVID. So an important distinction there. Both companies do have revenues in the pipeline.

would say New Scale is definitely further ahead here. All right. Pippa, thanks. Pippa Stevens. Tim? Well, the valuation argument against... uranium stocks is easy. They're really expensive. And if you look at Cameco CCJ, which is the one I own, and I own some Sprott Uranium Trust, I just think that the valuation is not...

equating with where the earnings are now. The dynamic here is I think there are people that believe that there are going to be major squeezes in the spot uranium market. Spot uranium is actually traded kind of lower. It's had a little bit of a bid. But if you look at it year to date and if you look at it.

in the last six months. But I think this really does come down to execution on where they are with their existing production and also how disciplined they'll be in contracting existing. And I think that's part of the story here. So a lot of volatility. But this is a five-year trade. It's been a great five-year trade for the last five years, and I think it's going to be as good for the next five.

Yeah. And I agree with that on the valuation, but I do think longer term, this is a story that's going to play out because if you saw anything from the Nvidia earnings is AI demand is not going anywhere anytime soon. And so when you're looking at AI demand and data centers, there's a huge need for electricity and new.

Clear is really the way to solve that. And especially if you are seeing this administration is more optimistic or, you know, friendly to getting these actually through and getting them regulated. That is really the biggest hurdle they have. It's not demand that's the issue.

That's going to benefit them. There's absolutely going to be a bigger, longer term story. All of these stocks, when you look at them, they all are in danger of double topping and failing. So CCJ, SMR, New Scale, that one actually shows the most constructive technicals. it broke out from that former high. But I would wait. And to Tim's point, I think they're all a little bit over their skis right now. I'd wait.

Coming up, Jamie Dimon raising a red flag for the bond market, why he thinks a crack is forming and what he thinks you should or shouldn't do about it. Don't go anywhere. More Fast Money in two.

Missed a moment of fast? Catch us anytime on the go. Follow the Fast Money Podcast. We're back right after this. Welcome back to Fast Money. Major indices flat today, but closing out a month of gains. The Nasdaq up nearly 10 percent in May. The S&P 500 rising more than 6 percent. Both seeing their best month since November 2023. The Dow is also up nearly 4 percent. To some movers today.

CBS and Cigna filing two separate lawsuits looking to overturn an Arkansas law banning PBMs from owning or operating pharmacies. CBS has said the law would force them to close 23 locations in the state. Its worst day in more than 14 years after a late-stage study of the drugmaker's experimental COPD treatment failed to meet targets. And shares of MP materials climbing today as Trump blasts China for violating trade agreements. MP has been your final trade.

time, Steve. Yes. And it's going to be, if you see where it traded to, it traded to approximately $30. And then when negotiations with China started to be a little more softer, the stock came in by a third. You're going to see this conversation just get volatile.

then peter out and the stock is going to trade right with it. So I would take profits up 10 percent. All right. Well, J.P. Morgan, CEO Jamie Dimon predicting trouble in the bond market. Dimon speaking today with CNBC's Morgan Brennan at the Reagan National Defense Forum.

You are going to see a crack in the bond market. Okay? It is going to happen. And I tell this to my regulators, some of you who are in this room, I'm telling you it's going to happen, and you're going to panic. I'm not going to panic. We'll be fine. We'll probably make more money. And then some of my friends will tell me that we like crises because it's good for JPMorgan Chase. Not really.

Classic Jamie. For more, let's bring in CNBC contributor David Zervos. He's Jeffrey's chief market strategist. David, great to have you with us. Do you think that we will see that crack in the bond market? I feel like you're a not panicking kind of guy, but should we be concerned about that?

Yeah, you know, you've had me on a number of times recently, Melissa, trying to not get people to panic about tariffs and tariffs seem to be consistently moving in a non panicky way after the initial panic. And I think. The same story in the bond market for me and the whole idea that we're going to have a loose trust moment or some sort of backup in yields because everybody's scared of holding U.S. Treasuries. I just.

I don't buy it. I think you can tell stories where the term premium is a little bit higher. And I like that story. We've steepened the curve a lot this year. And that makes sense to me. But the idea that we have some major crack does not seem like a reasonable story to me. David, I was sitting. Hey, it's Tim. I was sitting next to you on the desk and I remember your calm. And I think I guess the question I have for you is.

Where is your fear moment here for this market? And again, there still can be calm, but what is the thing that worries you most here, especially as you think about strategically a market that has come back and roared back to where we were? It's funny, Tim, I remember your comment because I went on a little diatribe and you go, wow, that felt pretty good.

I think we were in the middle of the second week of April, and that was what I was trying to do with a lot of our clients, talk them off the ledge, even some of the most sophisticated. And it was a complicated time. There's not a lot that really makes me nervous. terms of policy and in terms of.

Geopolitics, I'm always nervous because I think those events are not anything we can ascribe easy probabilities to, but they're there. There's wars going on. There's potentials for changes like what we had. COVID era, there's always those. But I do feel like we have a lot of insurance. We have a central bank that's got rates over 4%. If something goes horribly wrong, we have a lot of insurance and monetary policy that I think could be applied.

quickly and judiciously, even if the politics might initially get in the way of that. And so my worries are probably pretty low, consistent with where they've been for a while. It's Karen. Thanks for being on. You generally look like a guy who's not super worried about a lot. But let me just ask you, what do you think about the Fed? Do they need to do anything? If you were Jay Powell, what would you be doing?

Well, you know, Karen, I'm not a big fan of saying what I think the Fed should do. I'm like... I don't that doesn't make my clients any money because I'm not in control. So I try to predict what I think they will do. I think they're going to be a little sticky. I think they've been a little sticky. I thought Jay was going to play ball with the president a little more friendly.

pre-april 2nd and i think he like many others saw april 2nd and went oh my god i can't have a red jersey on this is crazy stuff and he backed away and and the markets really saw that in the second week of april when the fed didn't respond to all the the madness in the bond markets. And ultimately, I think the Treasury Secretary is the one who stepped in and stopped it. But I will say, if you push me, Karen, and you say,

What do you think you should be doing? And I think there is a CNBC group that I'm part of that we put our what we what we would do if we were in the in the FOMC or on the FOMC. I would be cutting. I'd be cutting pretty significantly. I don't think there's a great storyline here to have rates 200 basis points above neutral. And I think neutral is still somewhere in the low to mid twos.

We've got inflation all the way back. We had another great PCE report. And there just doesn't seem to be a great story for that. I think you're playing with fire and you don't need to. David, that's where I was going to go with PCE and CPI. It does seem like mission accomplished, right? So why not just take the victory and take the lap and move on?

Obviously, the dual mandate is what's getting in the way here, but I think they've done enough to check the box. You know, I think the fact that he got rid of QT early, he did that in the end of Q1, that seemed like a nod. to the new administration like he was going to play ball with them. And then I said, tariffs just got the Fed twisted up with, you know.

Typical D.C. politics where they just don't want to be seen as enabling behavior that that people consider to be reckless, whether that's true or not. I don't believe it. I think it was just negotiating tactics, but I understand where others come from. I guess where I would. come out on the debate for what they're going to do is I think Jay's got one year left. He wants to go down in the history books as the guy who

combated the great inflation without a lot of job loss. And that's a good story for him to spin. There'll be people that say he started the inflation, but I think that's a harder sell because every G7 country have the same amount of inflation. So I think he's going to be a little more stubborn. And that'll be that'll be slowly coming out of the bond market because forward guidance will lose Jay and it'll move to whoever the new candidate is. And we might learn about that new candidate.

within the next three to six months. As Secretary Besson has said, they're interviewing for the new Fed spots. probably by the summer and certainly the fall. So we're going to hear from whether it's there's lots of horse trading on these. Is it Kevin Hassett? Is it Kevin Warsh? Is it others who have been in the mix before? You know, I think we're going to start to hear a different forward guidance that really isn't Jay Powell anymore.

David, last time you were here, you said that the markets were massively overplaying tariffs, which was, in hindsight, the right call. So have the markets have processed in sort of the volatility surrounding tariff headlines?

Has the market also processed the economic impact of the tariffs, which have yet to really manifest themselves in the hard data? And I'm assuming that there will be some impact in the hard data, unless you think that there will be no impact in the hard data. So Melissa, great question. And let's decompose it into the two parts that you asked. The first part is, you know, how are we thinking about this? I came from the camp of this is a tactical art of the deal.

Classic Trump style negotiation where he's going to go big, be a little crazy, try to dislodge the opponents and get them to accept. something that actually would have been hard to get without going crazy at first. And I think many people did not see it that way. Many people thought this was some sort of actual true ask. in terms of the starting point from negotiation. And it just didn't fit the typical pattern of what we've seen with this president before.

I think if you step back and said, OK, this is all tactics, this is to try to drive a fair trade outcome, to get people to come to the table, to get them to reduce their tariffs, their non-tariff barriers, maybe strengthen their currencies like the Taiwanese have done almost 10 percent. since negotiations have started, and the dollar itself has weakened significantly on a trade-weighted basis. All of that was part of the rebalancing story. And I think that's...

largely played out and the market's more accepting of the view that I had. Whether there's an economic fallout, the second part of your question, Melissa, is a harder question. And it just depends on where we land. There could be a really positive impact.

because people just say, OK, we're done. No tariffs. We're out. We don't want it. We're going to let you sell cars and sell beef and sell soy. Come on in. We just want to make sure we have the U.S. markets open for business. We're scared we're going to lose that. Done.

And we're going to strengthen our currency a little bit so we aren't playing games with competitive devaluations and unlevel playing fields. And all of a sudden, it's actually a bigger pie that we're all sharing for global economic growth. And that's one story. And the other story is, you know, you get a little inflation, you get a little stagnation, you get a little because the tariffs stick around during that negotiation process longer than we would hope for.

David, great to have you. Thank you. David Zervos. Coming up, Wall Street still binging on Netflix. The Price Target Hike streaming in. And where are traders? See the stock heading next. Don't go anywhere. Fast Money is back in two. Welcome back to Fast Money. A couple of bullish calls on Netflix today. Evercore raising its price target on the streaming giant by $200 to $13.50. Bank of America upping its expectations to $14.90 from $11.75.

analysts citing strong subscriber growth, advertising opportunities, and newer live content. The bullish note comes ahead of Netflix's To Dumb 2025 event this weekend, where the company will announce news about upcoming. content specifically for Evercore they did a proprietary survey and basically found that a lot of folks liked live and would be more apt to continue being a subscriber if more live events were offered

And pay up. And pay up, yes. Right, $24.99 a month, I think they talked about. I mean, it's amazing how Netflix just keeps growing and growing and growing their audience and revenue and then... ad-supported tiers, growing advertising, all of that. I've always had trouble with the valuation. I am long. I've sold some 1,200 calls against it. A trade that probably would not work out great again. It's just the valuation, but they're so far ahead, it's worth it.

And I think the valuation is also my concern. It trades like 45 times forward earnings and like 34 is more like it's five year average. I mean, it's not only a premium to the market, but itself. And I think realistically, it has a pretty mature business here in the U.S. Most people do subscribe to Netflix already. So I think where the growth will come from is either international, you're going to see more ad revenue.

or increase in prices. But I think you do have a lot of a mature business. They have a higher bar. So with that and the valuation, I wouldn't be jumping in here. All right. Coming up, the teetotaling trade. Alcohol stocks going flat as drinkers go dry. Can the names get their buzz back? That is next. too.

Welcome back to Fast Money. The tap appears to be running dry on alcohol stocks. Constellation Brands, Boston Beer, Diageo and Coors closing lower again today. The stocks also down significantly for the year, but one major beer stock bucking the trend, Anheuser-Busch, surging. almost 41 percent this year, but is investing heavily in the zero alcohol beer market, which has been gaining popularity as consumers keep dry January.

going and going and going so is alcohol becoming the new tobacco stock that's what grasa said on the call today yeah i think the younger kids are drinking more non-alcoholic beer and they're also drinking more cbd infused seltzers even THC but the surgeon general is definitely taking a hawkish approach similar to what tobacco the way they did with tobacco so there's warning labels now on the back of alcohol but that might just get ratcheted up to causes

cancer seven kinds of cancer that's not going to be a great um you know tailwind to this whole whole entire sector uh look i i think there is absolutely a trend that's gone on in with younger people i also think there's a lot of cyclicality of this i think some of it's overplayed um i i steve's right though i mean in the cannabis space hemp derived thc drinks

are the hottest segment by far and are in a national footprint, and there's still a lot to be worked out with that. I guess I look at Diageo as an opportunity. I think the Bud move, some of it is, think about where Bud came from. Again, some missteps in terms of... where they had a marketing strategy. There has been a lot of consolidation in the beer space. I think the Spirits brands, Constellation and Diageo are world-class companies, and I think it's an opportunity. Up next, Final Trades.

Final trade time, Tim. It seems like the Chinese stocks are once again in the outs along with the sentiment. I think Baidu, of all of them right now, looks most oversold. And the bottom of a range here, interesting.

Karen. Yep. Ulta, I'm going to sell some upside cold. Courtney. We talked about nuclear. I like consolation energy. I think long-term, this has a play. Take profits, Netflix. Thanks for watching fast. Have a great weekend. Mad Money starts right now.

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