Markets Rally on U.S.-Iran Ceasefire… Delta Pops, Alibaba Bounces, and Banks in Focus 4/8/26

22:39Let's get more on this big story. Christina Parts and Elvis joining us here on set with that and more. and that$5 Canadian that I just handed you. Because right now we're talking about China. And the key word, China right now, China and chips. The key word you use, Brian, though, is own. And I have that in quotations in the prompter here because Baba launched a data center in southern China powered by 10 ,000 of its own AI chips. No NVIDIA anywhere in the picture. And that's not an isolated move. DeepSeq, for example, is about to release its next model and DeepSeq's an AI Chinese startup, a V4, and it will run entirely on Huawei's AI chips.

23:16According to the information, the model could have come out sooner, but DeepSeek spent months rewriting its code with Huawei engineers to get it working on domestic hardware. Alibaba, ByteDance, Tencent have all placed bulk orders. Hundreds of thousands of Huawei chips, not American chips. And Huawei is now trying to push those chips beyond China's borders. Malaysia recently said it would deploy Huawei's Ascend chips as part of a sovereign AI program. the first time outside of China. So the risk for NVIDIA is no longer just lost. Sales in China, I know many analysts will say, oh, it's not in estimates.

23:49We've taken it out a long time ago. But it's that parallel ecosystem forming around Alibaba, Huawei, and DeepSeq, one that gives Chinese AI firms something they haven't had before, an exportable alternative. So is this everybody kind of, it's hard to keep track. You got Alibaba, you got NVIDIA, you've got all these companies, Amazon, Gemini, Google. Are they all competing now? with each other? Is there a common winner somewhere? NVIDIA still has a stronghold over the market, especially on the trading upstage. With the inference, the second part where you're spitting out the answers to your queries, like who's on this Canadian bill, that part is becoming incredibly competitive.

24:28In the case with China, though, their AI stack, even on the trading front, may not necessarily still compare to what NVIDIA's latest offering is, but they have the ability to stack on many chips because power isn't a constraint. They're also, their chips are a lot cheaper, which makes it more marketable once you leave outside of China. And that's a huge selling point, given how much companies are spending. Hold on. There's a lot of fear in the car industry about BYD of China coming to the United States or Europe and taking a lot of share. Does that also exist in the AI data center and chip market?

24:58Is there a lot of fear? Well, that's this whole story. Yeah, I know. Is that going to come in and undercut? Is that going to kill NVIDIA? It's going to eventually start to chip away at its market share around the globe. See what you did there. Chip away? Yeah. You don't have to state the obvious. You're puns. But yes. Sorry. It was a serious. Who's on that$5 Canadian deal? Who is that? No, I'm not saying it right now because I'm blanking. Go back to this chip story. Is that the existential risk? John McDonald. Obviously, not today, but to NVIDIA, the fact that Chinese can do it cheaper and seemingly more efficiently.

25:34I'm air quoting. The answer is 1 ,000 percent yes. And why? Because the CEO of NVIDIA, Jensen Wong, how many times has he said that the Chinese market is worth so much? It's, you know,$50 billion. All of these AI Chinese developers are over there. We're missing out on this important market. And he's making that statement because he wants to convince politicians in D.C. to allow or to reduce the export controls, reduce the export ban so that they can keep, you know, their market share over there or they risk to come full circle to the story, losing it to Baba or Huawei or whatever other Chinese chip firm is gaining.

26:08It is a big story. Chips, to your point earlier in the show, and Tim's yours, chips leading the way today as well. All right. There is a lot more fast money to come. Here's what's up ahead. Time for takeoff. Shares of Delta surging after earnings. How they're offsetting the rise in jet fuel costs. And how much higher can they fly? Plus, big banks ready to kick off earnings season. What Chris Verone sees in the technicals and what it says about the market's next move. You're watching Fast Money, live from the NASDAQ market side in Times Square. We're back right after this.

26:52All right, welcome back. Shares of Delta Airlines soaring as much as 13%. They reported earnings atop both the pop and bottom lines this morning. And the CEO at Bastion was on CNBC this morning talking to Phil Lebeau, said that the company plans to meaningfully cut growth plans as jet fuel costs remained elevated, of course, because the war in Iran. Higher costs, adding two billion dollars to Delta Airlines fuel bill this quarter. Here's what Ed Bastion had to say. The fuel prices are going to stay elevated. We have to be responsible. We have to find ways to get our costs covered. One of the ways we're doing it in the second quarter is we're pulling capacity down to accommodate and try to get ahead of some of that potential weakness.

27:36But we're not seeing it. The last 30 days are booking sort of double digits every day for the last 30 days. Now, Delta Airlines also joining United and JetBlue and Southwest Airlines in raising checked bag fees this week. Obviously, the whole group, Tim, today got a big boost as oil prices and thus theoretically jet fuel prices came down or will come down. Well, I mean, everything Ed Bastian does seems to be thoughtful. But the best thing he can do is reiterate that airlines are run differently than they were 10 years ago, even five years ago, absolutely 20 years ago. And that's what he's doing.

28:13He's like, when we have higher costs, we certainly can't have too many flights out there. We've got to reel in our capacity. And that has been something that airline investors have been looking at for a long time. If you look at that operating margin in the first quarter, it beat all expectations. If you look at the the essentially the net revenue number of up nine point six percent, I mean, that that was higher than the guide, which had been upgraded. So I'm a Delta bull. I'm long Delta. I also believe that airlines may now be again. We're talking about a world if we're just going to play out the scenario that we started the show with, that we've seen the worst of it.

28:47that airlines, which haven't really re-rated since COVID, and actually were starting to before war hit, Delta kissed all-time highs today, pulled back. That's fine. I think you can buy that. When you look at the one-year performance on Delta, it's outperformed the entire group. Delta's the only one that owns its own refinery. You know that better than anybody. They said they saved like$300 million. They saved$300 million? So obviously it sounds like it's 10%, 15 % of the number that they said they're going to lose. No other airlines hedges these days. So that's their pseudo hedge. If you're going to buy an airline, I think Delta is probably the best position.

29:24How do the charts look, Chris? Tim, I think you would agree. It wasn't the greatest close today on Delta. But I think as long as this kind of keeps its head above 64, 65, it gets the benefit of the doubt here. Remember, this bottomed relative to the S &P on March 11th. So long before we knew what was going to happen over the last 24 hours, I think airlines in general have actually held up pretty well the last two or three weeks. Cruise lines have held up particularly well. I think Viking made new highs today. So the whole space, travel in general, Marriott comes to mind, Hilton, Wyndham, have all acted well despite the obvious headwinds.

29:53Fair enough. Just got to say, it's anecdotal. I've been to about 10 airports in the last five weeks. They've all been empty. What was your favorite? Calgary, YYC. That's where the stampede is. It is, and the flames. But I'll just tell you, they're all. YYZ is a great rush turn. And a great airport. Yeah. Not as good as YYC as an airport. All right, coming up, big banks on deck, ready to kick off earnings season. What Chris sees in the charts and why he says the group could be nearing what he calls escape velocity. Wow. Yeah, I also made that noise. We're back right after this.

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31:50Bank of America champions U.S. men's national team member Tyler Adams and everyone who dares to ask, what would you like the power to do? Bank of America, proud to be the official bank of U.S. soccer and FIFA World Cup 2026. Bank of America and a member FDSP. All right, welcome back. Pretty much like everything but oil and gas, big banks, they caught a big bid today. Citigroup, in fact, closing at its highest level since February. The action coming as we get ready for earnings from everybody. You've got Goldman Sachs kicking things off on Monday, and then the rest kind of all line up. So, Chris Verone, what are the charts saying?

32:27Well, guys, I think actually it's probably the most important part of the market here. Because if you think about what was the story before Iran, it was all about the private credit mass. So as Iran fades into the background here, at least we hope it does, I think the big question is, can the banks actually exhibit some relative strength here and put to bed some of the concerns that were brewing in the financial sector for the better part of the last couple months? I thought yesterday was interesting. So even before today's price action, you had something like 65, 66 percent of the banking group make a new 20-day high.

32:58So groups in uptrends where the new high list is expanding is generally a pretty good sign. I think if you pair that with the strength we've seen from the transports, it's hard to make a recession call when banks are hanging in, as they have throughout this entire thing, and transports are the leadership. It doesn't sound like very recessionary leadership to us. And, you know, I think, lastly, if you're going to talk about curve shape here as well with stocks like Citigroup, Bank of New York, PNC on the outperforming list here, that sounds like steeper curve, not flatter curve. So as we look ahead, Brian, over the next really number of weeks and number of months, what the banks do from here, I think, will be essential in gauging.

33:36Is there something more sinister out there? We don't think there is, but of course. And you say, I assume you say they're the most important group, Guy Dami, because the weight that they, they're not energy. I mean, I love energy, but it's four and a half percent of the market. It's not going to drag the market up. Financial is a bit of a different story, I think. The tell, the tell in terms of what they're seeing. I mean, Bank of America seemingly has only seen great things. But I think we've been universal in our love of Citibank. Jeffries, I think, initiated our upgraded stock at the end of March,$135 price target.

34:04Our logic behind it is, one, Jane Frazier, but two, the compelling valuation that even at$122, I think it still has. You know, the city has had the move. When you look at it, all these charts look almost interchangeable. But when you think about the year that's coming up now, we're going to have a couple of hot IPOs. There's going to be probably some decent M &A. and you think about Morgan Stanley, you think about Goldman Sachs, you think about J.P. Morgan. Citi has already performed. I don't say that they're going to turn back on it, but I would look to the year that we have in front of us versus the old story about D-reg and yield curve.

34:39So if SpaceX goes really, really well, Tim, is that going to open the door for a lot more IPOs, or is it its own thing and it kind of operates in a vacuum? I think it's both. I mean, I don't look at it as a driver for bank valuations because people are now looking at the IPO market. I think people are going to see that banks, in terms of their investment banking, in terms of their capital markets business, in terms of, I mean, those numbers were fantastic in the first quarter. A little volatility goes a long way. Chris is right. I mean, we were focused on credit. I think credit doesn't happen until it happens.

35:14And I think right now we're not looking at a credit crisis. I think the world we have is actually not near a recession. I think we've talked about it, and I think we've said stocks aren't priced for that. But getting back to banks, I would argue they've kind of been walking on sunshine for the last few days, not just today. In other words, they're up almost 14 percent off the floor. You're shaking your head. But Katrina and the waves also matter. And I would just say you don't want to see them rallying that much more into earnings next week because we know what happens when they do that. Coming up, possibilities in property.

35:46what your next guest says may be the ultimate safe haven in real estate.

35:58All right, let's talk about real estate. Not the great New Jersey band, but actual real estate. Thank you. Housing stocks may be struggling, commercial REITs, though, mostly outperforming. The broader market by about 9 % this year. Your next guest says the space may be the most attractive safe haven trade in the market. Daryl Crate, the CEO of Easterly Government Properties. Joining us now on set, maybe the best ticker out there, DEA, because most of your properties go to the DEA, FBI, their government. So you would assume that is a safe haven. But we also know that D.C. is a lot of work from home.

36:34How does this get resolved? What does it mean for Easterly? Yeah, well, we built this portfolio for durability. We don't own any federal buildings in Washington. We're out where the work gets done. And it is out in the field offices of the FBI, the Drug Enforcement Administration, the Veterans Administration. The ticker is DEA because they wouldn't give us FBI. But broadly, it's all of those agencies that, dependent upon Republican, Democrat, they have an enduring mission for the United States. And we know that these buildings and the enduring mission is going to last for decades to come. What is, Darrell, let me ask you then, though, because I got a lot of friends in D.C.

37:08and the Virginia area and a lot of them, you know, they're going to hate me for saying this. They're working from home almost all the time. Yeah. The stock could use some help. It's had a tough couple year run. What is Wall Street missing about easterly government? Because somebody is missing something. Yeah, no, no, it's a great point. I mean, again, you know, in the vacancy, Doge, all these concerns have really put, you know, put a head put headline pressure on the stock. The reality is, though, that you can't catch criminals from your basement. The DEA, you can't store drugs in your refrigerator at home.

37:41You've got to do those in those facilities. And we have leases, very young buildings. They're 16 years old. A government building lasts 40 years. So we've got one lease, two lease renewals that are coming. So there's just consistency cash flow. With an 8 % dividend, we're in a fantastic place to provide durable income and an opportunity for investors. Talk about the impact of Doge, if any, and budget cuts, because my sense is that was sort of a double whammy in terms of the stock price. Yeah. I mean, Doge, again, the stock really got hit with Doge because people thought the government was going to cancel all these leases.

38:14These leases say United States of America on them. You know, they are full faith and credit of the U.S. government, just like your dollar bill. So they're not going to default on these leases. But there is confusion. There's always there's always been confusion as we're going through these transitions. So we find ourselves in a place where the stock continues to get beaten down, but the durable cash flows are there for investors. Darrell, I think it was in yesterday's Wall Street Journal or maybe this morning, there was an article about how stuff in the D.C. market on the commercial side is getting sold for, you know, 10, 20 cents on the dollar.

38:43I actually view that as bullish, that there's activity. Now we know the price and stuff is clearing. Would you view it in a similar way? Yeah, no, I mean, I think there's a lot of government buildings in Washington in particular, you know, that should be vacant. It's not really where the work is getting done. But you do have a stabilization in office in D.C., but also around the country. In the office sector, in real estate generally, it's been a little bit of a depression because fundamentally banks have withdrawn their financing from many of these buildings. Capital has been scarce, and that's really depressed.

39:11You haven't seen flows going into real estate in really a couple of years. But as interest rates are where they are, valuations are at attractive level. If interest rates come down just a little bit, inflation stays away. Real estate could be a place to be. And why not be in a place with long-term leases, high credit tenancy, durable asset? That's actually the commercial I was going to ask you. Everyone talks about the patent cliff, but there are a couple of refi walls that are coming up. And when you look at commercial real estate, these short-term rates were at 3%, 3 % and change, 4%, maybe the max.

39:41Now you're looking at considerably higher rates. And people have avoided that section. Is that a big part of why people are staying away from commercial real estate? Absolutely. I mean, you know, one of the biggest influences of real estate is interest, you know, is really interest rates. And as you think about it, a real estate real estate investment gives you bond like returns, but also gives you some equity opportunity. There's been so much uncertainty in our space, in the government, which now there's clarity. Not one of our leases was canceled during Doge. But you look in the office sector generally and you're beginning to see people understand where that is, where valuations are.

40:16And the biggest stress point is interest rates. So as we get a little more clarity on where we go as Kevin Warsh comes into into this new seat, maybe it's really a time where real estate could run. All right. Daryl Crate of Easterly Government Properties. Daryl, really appreciate you coming on set. Great to be with you guys. Thank you very much. We've got some vacancies around here, too. You might maybe move in. Tim, your take on the group? Well, I think it's always some sense of cyclicality. It's some sense of interest rate sensitivity. It's some sense, really, of where you are seeing institutions looking for yield.

40:46I mean, this is an environment where when yield has been plentiful or there have been opportunities to find either inefficiencies or there's been at least yield product out there. I think that's where the cycle runs. It's certainly a place we talk about housing market. We talk about investments there. And I don't think you need to chase that stuff here. All right. Coming up, we're going to talk inflation, oil and geopolitics. We're going to give you the read on how investors may be feeling about some of the biggest risks that still remain in the market and what that means for what you should be doing with your money as well.

41:19More Fast Money in two minutes.

41:27All right. Welcome back to Fast Money. Even before last night's Seats Fire announcement, investors feeling cautiously optimistic on the market. How do we know that? Well, we know it from Investopedia's latest reader survey conducted earlier this week. Editor-in-Chief Caleb Silver is here now with more on individual investors. And I want to say that this, Caleb, good to see you, this survey was done two days ago? Friday through yesterday. Okay, so a lot changed. Busy five days. Today felt like five days in a good way. Tell us what you learned. And then also kind of give us your editor-in-chief view of how things may change if you redid it today.

42:07Yeah, well, we've been gauging sentiment every single day. But when we ask them point blank these 25 questions, what are you afraid of? What are you buying? What are you selling? What would you do if you had some extra money? Most of the individual investors we survey say we're still pretty optimistic. Maybe they've seen this before. They have taken some shots over the past few months. And maybe they're saying that's all you got because they assumed that this might happen, what might happen today. and it might happen again. Now, maybe they're being foolish about it, but they've been right every time that they've stayed in the market and continued buying their favorite stocks.

42:38So the idea basically is that, yeah, you're afraid. It's a scary time. There's a lot of uncertainty. We don't know what's going to happen overseas. Heck, we don't know what's going to happen here. But your readers are saying you got a hodl, for lack of a better term. I know it's a Bitcoin term, but for stocks, hold fast. Hodl because these are the stocks that have brought them such great gains over the past few years. But also, we saw about half of our readers trying to buy the dip in their favorite stocks. Their favorite stocks, again, look like the top of the NASDAQ 100, look like the top of the S &P 500.

43:09About half of them said, we took an opportunity to get some of these on discount. Caleb, what has changed in terms of their approach either to Bitcoin and some of the exotic stuff that was seemingly a place they wanted to be? Even gold and gold miners placed that plenty were exposed, but we know what was going on in the momentum, and it feels like the retail investor left before the institutional did. Absolutely. When we ask our readers, where do you feel the bubbles? Where's the frothiness? They still feel it in AI stocks, and they definitely still feel it in crypto, even after a big haircut in Bitcoin and other cryptocurrencies.

43:44Maybe they never believed it, and now they really don't. Gold also, they feel, even with the drop, is overvalued. So they feel heaviness in a lot of those assets. Again, it's the stocks that they lean into, and they've been doing it all along. So when you look at this, you've been doing this for a long time, and I love this segment. Is there anything that sticks out at you where you look at it as a 50 ,000-foot-up technique? Is there anything that sticks out other than the resilience of the retail stock owner? Do you see anything where you say, OK, maybe there's a little bit of a nuance to this?

44:15Yeah, when you look at the stocks that they've been buying lately, we like to do that every single week. We're looking at stocks like Apple, which caught a pretty big bid over the past few days, despite some of the news. NVIDIA, always. Microsoft, Tesla, Micron, and Amazon. Then we ask them, what stocks do you hold? Again, a lot of those same stocks. But then what stock would you buy today and hold for the next 10 years? Same stocks. They are not willing to turn over their portfolios, even after some big sell-offs here, even after leadership has shifted to other parts. But it's interesting because I know we've got a lot of people probably driving home.

44:44They're on the radio, so they can't see you. Oh, heads up. Here we go. Sandy's off. We got the chart at 50 % of your readers said that AI-related stocks were the most likely to be overvalued. So the other half, I assume, is staying in, and the other half is like, sold to you. They may feel like they're expensive. That doesn't mean they want to sell them. That doesn't mean they wouldn't buy them if they had some extra money. We always ask them the discretionary question. What would you do with an extra$10 ,000? Buy individual stocks. That's what they've been doing. That's what they intend to keep doing.

45:17and they have been through some cycles. This last little correction shocked a lot of people just with the severity of it. But they've seen these stock markets bounce back, especially over the last five years. They're not willing to totally believe in a big dip that's going to be sustained. I love that graphic. Put it back up. What would you do with an extra 10K? And the last one was CDs. And my old brain immediately went to music. I'm like, oh, they're going to buy some music with that. Or some talent records. See, there we go. But I assume they mean certificates. What would you be buying? Like some Kaja Gugu?

45:43No, no, no. Too shy, shy? No way. Come on, you're not going to get me on this stuff. Caleb, love you, man. Thank you very much. Up next, your final trades. Cool.

46:00Quick newsletter on Anthropic. A U.S. appeals court declining to block the Pentagon's blacklisting of Anthropic. Kind of a win for the Trump administration. Defense Secretary Pete Hedgeth instituted the blacklist over Anthropic's refusal to allow the military to use its clawed chatbot. for surveillance. Final trade time. Tim, kick it off. Yeah, Chris talked about transports acting well. UPS is ready to bust a move again. You know, I like where the market gives you a tell, and you know what popped today? Quantum stocks. Inflection. More to go. I think these banks are okay. Citigroup long. Picker C.

46:33Guy. No one played the game. Nobody played the game with Tim. I played alone. It's fine. My favorite one-hit wonder is Lady in Red by Chris the Byrd. It's brutal. A lot of people are now You kind of Rick rolled us. Poison for the rest of the night. Yep, it was a Rick roll. Walmart. Walmart is your final trade. All right. Really appreciate that, everybody. Hey, have a great night. Thanks for watching. Matt starts right now. All opinions expressed by the Fast Money participants are solely their opinions and do not reflect the opinions of CNBC or its parent company or affiliates and may have been previously disseminated by them on television, radio, internet, or another medium.

47:06You should not treat any opinion expressed on this podcast as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of an opinion. Such opinions are based upon information the Fast Money participants consider reliable, but neither CNBC nor its affiliates and or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. To view the full Fast Money disclaimer, please visit cnbc.com forward slash Fast Money disclaimer. My community gives me the confidence to ask myself, what would you like the power to do?

47:35So every time I'm on the pitch, I play for more than myself. Oh, what a tackle from Naomi Gerner! They're absolutely brilliant. Bank of America champions U.S. Women's National Team member Naomi Girma and everyone who dares to ask, what would you like the power to do? Bank of America, proud to be the official bank of U.S. soccer. Bank of America N.A. member FDSE.