CNBC Halftime Report
2026-05-19 · Hosted by Scott Wapner · CNBC
Executive Summary
The Halftime Report focused on rising rates as the primary near-term portfolio risk, with the 10-year yield hitting 4.63% — its highest since February 2025 — and market odds of a Fed rate hike rising sharply. Scott Wapner’s investment committee debated whether the AI earnings tailwind is sufficient to offset rate pressure, with Nvidia’s Wednesday earnings cast as the pivotal test. Key committee actions included Steven Weiss adding hedges and trimming Micron on momentum concerns, while Joe Terranova remained positioned in AI names with Apple added on Wednesday. Secondary stories covered 13F filings revealing Berkshire Hathaway’s return to airlines via Delta, ServiceNow’s agentic AI opportunity, and Regeneron’s Phase III failure. The episode concluded with an ETF edge segment emphasizing real assets as an inflation hedge.
Key Stories & Changes
1. Rising Rates — The Market’s Biggest Challenge
10-year yield at 4.63% — highest since February 2025; the S&P is tracking rates nearly 1-to-1 over the past month
Market now prices a December Fed hike at 51%, January at 60%, March at 71%
Ed Yardeni calling for a July rate hike while maintaining his S&P 8,200 target
Mike Wilson (Morgan Stanley): “bond volume rises with rising rates… we would expect a first meaningful correction in equity prices since the markets bottomed in March”
Weiss: “bond vigilantes” — deficit running $1.9 trillion vs. $1.7 trillion last year — are structural force driving rates, independent of the Fed
Shannon Sikosha (investment committee): “overreach on the rate story” — doesn’t expect Fed to hike because there’s no CPI transmission from energy to core
Only 44% of S&P stocks trading above their 50-day moving average despite index near highs
2. Nvidia Wednesday Earnings — The Key Test
“Dan Ive said it’s going to be a golden moment for the tech space”
Three price target raises the same day: Morgan Stanley to $285, KeyBanc to $300, DA Davidson to $300
Whisper revenue numbers approaching $90 billion vs. consensus ~$80 billion
Joe Terranova: critically important that Nvidia demonstrate no supply chain disruptions; $212 stock price as key support (prior 6-month range high)
Key watch items: forward guidance (most important), gross margins holding at ~70%, Blackwell server rack transition complexity
Consensus: “blockbuster quarter” already reflected in hyperscaler CapEx guidance; surprise must come from forward guidance
China contribution: limited near-term; H200 licensing “not a factor as we move forward” in the short term
3. 13F Filings — Smart Money Moves
Berkshire Hathaway re-entered airlines via a $2.5 million stake in Delta — now 14th largest holding
Berkshire also tripled its Alphabet stake; Berkshire exiting Visa, Mastercard, reducing Chevron
CEO Greg Abel’s fingerprints: pivoting toward technology while maintaining conviction in select consumer/transport names
Appaloosa doubled Amazon stake; added SanDisk in Q1
D1 Capital added to Amazon, Nvidia, Broadcom; exited Meta — Weiss trimmed Meta position simultaneously (trading position too large after adding too low)
Melius Research raised targets: Micron to $1,100, Marvell to $220, Qualcomm to $220, AMD to $540
4. Steven Weiss Trims Micron — Momentum Play Unwinding
Weiss trimmed 10% of Micron last week and sold more pre-market this morning; caught near the top tick
Entry in April at ~$350; stock ran 30-35% before he started exiting
Valuation concern: “multiple” expanded to ~8.5x — not cheap; “yada, yada, yada story” meaning it looks cheap next year but execution risk is elevated
Not exiting completely — will re-enter on weakness if momentum dies
Broadcom target raised to $490 at UBS; reports June 3rd
5. Regeneron — Phase III Melanoma Failure
Regeneron down ~10% on Phase III failure for lib-tayo in melanoma (second major failure in ~12 months)
Downgraded by BMO; target cut from $900 to $700
Joe Terranova: bought in ETF at $741 in January; now below that; momentum neutralized, below 200-day moving average at $691
12-month consensus price target still implies 70% upside from current levels — “a lot of optimism” remains
“You have to let this play out and work off some of that bullish sentiment”
6. Berkshire Enters Macy’s — Retail Call
Berkshire took a position in Macy’s; Weiss commented retail has right-sized
Macy’s down to ~350 full-line stores — “probably supportable” base
“Maybe it makes sense” — Macy’s running business better than any point in recent past
7. Housing — DR Horton and ITB Backdrop
ITB (home construction ETF) in downtrend as 10-year rises; 30-year mortgage above 6.5%
Jason Snipes owns DR Horton — “long-term bullish on affordable homes”; stock only down 4% in tough backdrop
Wapner skeptical: new home first-time buyer age now 40 (up from 30); inventory up significantly; rates won’t cooperate near-term
Home Depot reporting tomorrow morning — key read on renovation trade and consumer spending
Trends Identified
1. Rate-Driven Portfolio Repositioning
The investment committee is actively adjusting — Weiss adding hedges and trimming positions, Terranova buying more Apple while staying AI-concentrated, and the broader debate shifting from “will rates stop the rally?” to “is a hike already priced in?” The near 1-to-1 correlation between rates and equities over the past month signals the market has entered a regime where rates are the dominant factor, eclipsing earnings. The Schwab ETF segment validated this by recommending real assets (energy, materials, cyclicals) as an inflation hedge overlay on top of hyper-scaler positions.
2. AI Infrastructure Story Broadening — Semi to Software to Utilities
The AI trade is expanding its footprint: semiconductors first, then networking, then software (ServiceNow, cybersecurity), and now power infrastructure (NextEra-Dominion deal discussed in related coverage). This broadening is simultaneously a sign of health and a sign of potential froth — as more sectors re-rate on AI adjacency, the incremental return for early movers may diminish. The Halftime panel noted cybersecurity (CrowdStrike, Fortinet, Palo Alto) making new highs as money rotates within the AI ecosystem.
3. AI IPO Pipeline Momentum
With OpenAI’s legal overhang cleared and SpaceX reportedly targeting June, the AI IPO cycle is accelerating. The committee discussion of SpaceX’s potential inclusion in Nasdaq 100/S&P 500 highlights a passive-buying demand tailwind that is separate from fundamental valuation. Forced demand from index inclusion could meaningfully move markets regardless of retail sentiment toward AI or the specific companies.
4. Momentum Factor at Extreme — Orderly Rotation Underway
Jonathan Crinsky’s analysis cited by Wapner — semis had their worst single day since March on Friday — and the Halftime panel’s discussion of 44% breadth below the 50-day confirm the market is in a momentum unwinding. The key debate is whether this is a healthy rotation (software, cybersecurity, and financials catching bids as semis retreat) or the start of a broader de-rating. Most committee members lean toward healthy rotation; Weiss is the most cautious, having added hedges. —-
Sentiment Analysis
Overall Market Sentiment: Cautiously Bullish with Rising Hedges
The committee acknowledges elevated risk — rates, oil, narrow breadth — but the AI earnings thesis remains intact enough to stay largely long.
Risk Factors Highlighted
Bond vigilante pressure: US deficit at record $1.9 trillion; independent of Fed, bond market is tightening the curve.
Fed rate hike scenario: December probability at 51%; a hike “would not look like the market does” — Weiss called this scenario for record-high S&P incompatible.
Nvidia margin compression: Transition from individual GPU sales to Blackwell server racks adds labor and complexity — gross margin maintenance at ~70% is key watch.
Semi momentum exhaustion: Jonathan Crinsky noted worst single session since March; 44% of stocks below 50-day MA despite index highs.
Oil structural pressure: Two Trump options (attack, maintain blockade) both negative for oil; only diplomatic off-ramp positive — but bond market has no off-ramp.
Housing market deterioration: 10-year-driven mortgage rates making affordability worse; new buyer age now 40; renovation spending deferral (Home Depot signal).
Paul Tudor Jones commentary: PTJ suggesting AI trade is “a year or two away from the ending” — bringing forward the exit calculus for other investors.
Regeneron M&A dependency: Two Phase III failures means the fundamental growth story requires acquisitions to recover; deal risk and capital allocation under pressure.
China chip contribution absent: H200 contribution to Nvidia revenues not expected in near term; China upside optionality but not immediate catalyst.
Earnings growth concentration: S&P up 10% year-to-date but tech accounts for 85% of that; ex-tech, S&P returned just 3%.
This episode was covered in today’s The Market Signal — 2026-05-19, a cross-source synthesis of multiple podcast reports.