Tariffs, tariffs, tariffs.
It's tariff Friday on Wall Street. And so far, Wall Street hates it. Stocks across the globe have come under pressure and the VIX Index, Wall Street's fear gauge, has sprung to life. The market has rotated back into bonds, despite the hawkish Federal Reserve meeting this week (telling as to the growing nervousness on Wall Street). The Trump administration levied a 25% tariff on $50 billion worth of Chinese products Friday. An announcement is expected later Friday.
These 50 stocks are at risk in a U.S. trade war with China, which must not be ruled out. Top names on the list include Micron (MU - Get Report) , Qualcomm (QCOM - Get Report) and Nike (NKE - Get Report) . Honorable mention to Walmart (WMT - Get Report) since it sources roughly 75% of its merchandise from China. Said TheStreet's founder Jim Cramer on Real Money ahead of Friday's trading: "It looks ugly. Long day ahead. But remember, this is not a shocker. A known-known that's bad is a lot less dangerous than an unknown-known, and that's exactly what we have on our hands."
Nowhere is trade risk priced into stocks, and that should worry the bulls.
Names on TheStreet
Hat tip to former hedge fund manager Whitney Tilson for getting Anthony "The Mooch" Scaramucci down for a small chat to his Kase Learning students this week. For 43 minutes, The Mooch talked about himself and tried to impart some wisdom to the crowd. Pretty entertaining performance. You can watch the full video here. Meanwhile, Stifel's veteran deal-maker, Victor Nesi. told me he is bullish on the outlook for M&A in the back half of this year.
Nesi does voice a touch of concern on the amount of debt being used to finance deals.
Around the Horn
(1) Struggling General Electric (GE - Get Report) will see its shares open around a two-month low Friday. The stock is down 7.3% in the last month. Talk about a no-confidence vote in CEO John Flannery's actions to extract value from the company. Along the same lines, talk about Trian Partners Nelson Peltz's (who has long-time partner Ed Garden on the GE board) inability to pump up the stock at TheDeal's corporate governance conference last week. When asked about General Electric, Peltz said that he believed that a breakup is possible. "Well, when a man says everything is on the table, I mean you got to take him at his word and I would definitely take him [Flannery] at his word," Peltz said when asked by TheStreet's Jim Cramer if GE was seriously considering a breakup. Nevertheless, Peltz is still a market mover but even he can't jack up a stock before what is a likely dreadful second-quarter earnings report in July
(2) In the "Just Sayin" category, darn-near-dying J.C. Penney (JCP - Get Report) said Thursday evening it will sell its three corporate jets and take a $50 million impairment charge to do so. Impending cash crunch for JCP? Signs of more store closures (less aircraft, fewer store visits)? Probably both at a time iwhen the company is looking for a new CEO
(3) Qualcomm's (QCOM - Get Report) stock has been stuck in the mud for some time in large part over concerns about its NXP Semiconductors (NXPI - Get Report) deal and pricing war with Apple (AAPL - Get Report) . But in light of news of Chinese regulators reportedly clearing the deal, Qualcomm could turn into a pretty hot stock. Wall Street will have to go back to the drawing board, big-time, on their profit forecasts for Qualcomm. That will probably push up the stock even if the company's core business continues to show mixed results.