Stocks Climb as Oil, Yields Retreat… And Impact Of Fed Rate Hike On Housing Market 9/17/26

23:06So it's not cheap. And this is a story that historically there have been these moments where Best Buy has been really cheap. But at this at this level, it's trading kind of 12 times consensus 27. I think you missed this one, even though I think it's a high quality name. And I certainly I love the store and I will be there this weekend. You don't need to be there. You can just go on chat. Yeah, that scares me, by the way. My bot would be buying more stuff than I do, I'm sure. Apple's newest phones are going on sale tomorrow as well. And that traditionally has been a great thing. Right. No, I think this is partially what's moving the stock.

23:41And right. You get people in the store for that. And who else? You know, they are people with discretionary. Money they've burned, yes. Sounds like Tim, right? Many pairs. Many pairs. There's a lot more Fast Money to come. Here's what's coming up next. nuclear stocks getting energized the group looking to bounce back after a rough ride the names that could go radioactive from here next plus the real read on real estate what a top housing analyst sees in store for the market after the feds rate hike and the impact it could have on potential home buyers you're watching fast money live from the nasdaq market site in Times Square.

24:19We're back right after this.

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26:00Welcome back to Fast Money. Move of the day goes to uranium stocks. Jumping after the House passed a bill forcing data centers to fund their own power infrastructures. The URA ETF up 3 percent, its best day of the month. Oclo, New Scale, Centris, all seeing notable gains here. CCJ also higher. What's on that chart there, Tim? Yeah, I'm a little surprised you get this kind of a reaction, even though we've known all along that the nuclear play as it relates to data centers is really important, especially places like Texas. I think this is also a case of where you have spot uranium prices now which are squeezing higher.

26:36There are people that are short. There are utilities that are short. This is a trade that has a lot of lead lag in it, but it's ultimately a very long term kind of cycle trade. And I think, you know, I think you own uranium for the next 10 years. I think you're going to look at Cameco and say, wow, that's really expensive, except for this is such a high quality name and they have production and they also they're fully integrated. So I like it. Charts don't lie. What do they say? So it's a retest. It's a retest of support. So for those that do track the commodities closely, there's something called the cloud model that's really very popular.

27:08And if you look at the URA ETF, it's on that cloud-based support, both on the daily and the weekly. And, of course, with the retracement, it is oversold. So I think good for a bounce, yeah. So I think CCJ, I agree with Tim. I pronounce it Kamiko. You said Kamiko. I don't know what the right pronunciation is. I think it's Kamiko. Well, somebody could tweet us and just sound it out. But when you look at this space, that's – How would we know? Well, they could do it phonetically. Yeah. So so this one's up marginally on year. It's basically flat on year. But this is probably the best one to play. I do agree.

27:42You want to be a nuclear. There was a Gallup poll. Fifty three percent of the public don't want a nuclear reactor next to them. Seventy one percent of the public doesn't want a data center next to them. So that's flipped. When I was growing up, no one wanted it. They were combined. Yes. So no one wanted this next to you. But now everyone has flipped on nuclear. So the push is bipartisan to push into nuclear. Expect more reactors. This is all bullish for the segment. There's also the NLR, which is it's an ETF, uranium and some nuclear. And you get, you know, you get Camico, Camico. It's Camico.

28:21They're big fans of the show. Coming up to the housing market after the Fed's rate hike, Top analyst Ivy Zellman will join us next to dig into the outlook for mortgages, affordability and much more. Fast Money is back in two.

28:42Welcome back to Fast Money. Stocks rallying after yesterday's sell-off as oil and bond yields pulled back. The Dow jumping more than 300 points. S &P 500 up more than a percent. The Nasdaq and Nasdaq 100 leading the charge, both climbing about 1.7 percent. Shares of Generac jumping nearly 20 % after a deal with Amazon to provide backup generators to the e-commerce giant's data centers. Amazon also getting warrants to purchase up to$30 million worth of Generac stock. Shares of Workday climbing 6 % after our own David Faber reported that efforts to obtain financing for a take private bid are continuing.

29:14The cloud-based HR software platform still negative for the year, down nearly 20 % over the past two years. And we are watching shares of McDonald's after hours. The company raising its quarterly dividend by 4%. Shares hit a new two-plus-year low in today's session. They've got an investor day next week as well. Meantime, the housing trade catching a bit of relief after yesterday's Fed rate hike. 30-year mortgage rates pulling back by about five basis points. Housing and real estate stocks, meantime, moving slightly higher. Diana Olek is at the Zelman Housing Conference in Boston. and she joins us now with the firm's co-founder and executive vice president, Ivy Zellman.

29:50Diana, take it away. Thanks, Melissa. And Ivy, welcome once again. You know, we were here sitting in this exact spot in this noisy room one year ago, and at the time we were talking about mortgage rates coming down and home prices coming down. What happened? Well, unfortunately, mortgage rates went the wrong way. Early in the year, in 26 in March, we actually started seeing rates come down. And really, there's always been a rule of thumb. If you have a 50 basis point change in direction of rates up or down, that could be a catalyst. And I think we did see green shoots more in the resale market.

30:24As we know, the builders are already offering$4.99. But I do think that the prices have been coming down. And that really hasn't been as significant as it might be nationally. Nationally, we're still up. But you go into certain markets today and prices are down, like in the sun of the sunbelt, as much as double digits from the peak. But we are finally seeing capitulation. Sellers are starting to lower their overall asking prices. In fact, Stuart Miller on their earnings call mentioned that the resale competition is heated up, not because there's more inventory, but they're lowering the prices finally.

30:57So there is capitulation happening. But you mentioned Stuart Miller and Lenar. They had some really rough quarterly earnings that came out yesterday, missed on everything. And margins were the problem. We talked last year about margins improving for the builders. How bad is it going to get as we know they have to buy down mortgage rates, we know they're doing more incentives, and as you said, they're cutting prices? It's a very challenging environment. And one of the good guys in 25 and early 26 was the input costs. And now with oil surging, we're seeing more price increases announced by suppliers, and it's going to be harder for them to push back.

31:30Interestingly, we've also seen a lot more chatter, heard more chatter, about raids and deportation having an impact, tightening labor trends. So right now, as weak as the market is, we're already seeing tightening in labor. So all those input costs, labor materials are not going to be friends again. And we think there's a downward bias to margin. And we talked last year about spec homes, that is, homes that are built that don't have a buyer yet. And there was kind of this difference between Pulte was saying, no, we don't want to do spec homes. Lenar saying, yes, we do want to do spec homes. and we've seen earnings from Pultigroup a bit better.

32:06How do you stand on spec homes now? Because last year you were pretty bullish on those. Well, for a while, the only thing that people wanted was new move-in ready, and it was very appealing, and that happened predominantly during COVID. There's a lot of efficiencies in building spec, but in a soft market, they're very motivated sellers, so they take the pain on margin as a result of it. I think there should be some benefit to starts pulling back, and should we see that level of spec coming down, that's going to be positive. So at this point, I don't think builders are going to pull back tremendously, but maybe on the margin a little bit.

32:39And I want to talk about single-family rental homes. Obviously, we had a big change in the law that large investors like Invitation Homes, American Homes for Rent, can no longer buy existing single-family rental homes, but they can buy build to rent. How is that going to change the dynamic in the builder sector? And also, do you think that's actually going to help make housing more affordable? Well, I think the builders need that distribution. So being able to sell to the single-family rental operators is a good thing for them so they can sell in bulk when they're having difficulty selling to the buyers, prospective buyers.

33:13But I think that because of the 21st Century Act, it's going to make rents even likely move higher because there's going to be less competition in the rental market from institutional investors buying on MLS. So it actually might hurt rental affordability rather than help it, but I don't believe that it's going to help overall affordability for buyers. It probably goes the wrong way for single-family rental prices eventually. And we did see housing starts on the single-family side go up, that report this morning, but we saw multifamily drop pretty sharply, down over 20 % month-to-month. I know those are volatile monthly figures, but where do you see the rental market going, especially in multifamily?

33:50We think multifamily will remain under pressure. There's too much inventory. Vacancies for multifamily are above trend line. We need to see those vacancies come down. The good news is there's better rental demand. Renter households are growing faster than for sale households. So I think that the level of inventory in the market will get absorbed and rental prices are going to start to accelerate. They are a little right now, but they're going to get better. Yeah, I would ask you what is going to happen next year, but I'm not going to do that this time. Ivy Zellman, always fantastic to have you on, and congratulations on a great summit.

34:25Melissa, back to you. Thank you so much, Diana. Anna, our thanks to Ivy Zellman as well. Fascinating interview. I think a couple threads come out of this, especially as we head into the midterms here about affordability, and that is the affordability of home buying. It's not going to get better. And home rentals doesn't sound like it's going to get better either. Right. That's a problem. Because one of the things that was bringing inflation down was that price going down, right? And so if that doesn't continue to go down, obviously you have more inflation beneath it. So I don't know how long it's going to take for these, you know, Steve always likes to say, you don't own a home, you own a mortgage for those fantastic mortgages to just age out if the seller just has to, even though it's so great.

35:05But it's been five years now. Yeah. Yeah. I mean, a huge percentage of people who hold mortgages are below 4%. So the magic rate is five and a half percent. We're nowhere near that. That's going to unlock existing homes. But all the home builders have done terribly. And Home Depot is better than Lowe's on just a technical basis. And you could weigh in on this, but it looks like a double bottom where Lowe's looks like there's no end in sight. What do you say? Yeah, I mean, the whole sector has been somewhat out of favor, but I would agree. I think Lowe's has decent momentum, but it's just not the place I want to be right now.

35:41I think we have better momentum in other sectors. I just think higher mortgage rates equal higher rental rates, which equaled, yeah, I mean, this is all politically unpopular, But again, I just think it leads to higher rental prices, and that's going to feed through to inflation. I think nibbling at Home Depot here is fine. I think it's such a high-quality name. It's a cyclical name. You know, buying interest rate, so strength, so higher rates, so weakness in the stock is something that I think if you're a long-term investor, this is an opportunity. There's nothing structurally broken about HD, and that's what I've been doing.

36:16Coming up, will Japan follow suit? What to expect from the BOJ as a country's central bank gets ready to deliver its rate decision and the global inflation risks everyone seems to be fighting. Fast Money is back in two.

36:34Welcome back to Fast Money. We are just hours away from the Bank of Japan's next interest rate decision. The central bank is expected to raise borrowing costs by a quarter of a percent to their highest level in 31 years. For more, let's bring in BK Traders Director of Market Strategy, Kathy Lean. Kathy, great to see you. Let's say we get what is expected. I guess a lot will be in the commentary after and whether or not they will be hawkish. So what are you expecting out of this meeting in all? I think you're absolutely right. Twenty five basis points. A rate hike is exactly what the market expects.

37:06Anything short of that, anything more than that is where we're going to get the surprise. And I don't think that's going to happen, but that's what we're looking at. And then it flips to the guidance in terms of, you know, how much more the central bank is going to get, that is really going to all determine how the yen moves. But if it's just 25 basis points, I think, you know, you're going to have an immediate yen rally followed by probably a pullback. You fade that rally, Kathy? Yes, that's basically what I'm getting at, which is that, you know, it's very tempting. We saw a little bit of that with the Federal Reserve.

37:38Whenever you have the market ready zeroing in, not only on the 25 basis point rate hike, but the fact that it's pricing in 90 basis points of tightening over the next year. Just one bout of tightening is going to end up just being a bit of a disappointment. And so oftentimes with the Japanese particular traders, they end up fading the move in dollar yen. That seems to be the most rational trade and the one that we see historically happen again and again. Hey, Kathy, it's Tim. This is an interesting time to have you. Thanks for coming. I just as they say down south, with all due respect, I don't think the BOJ has a whole lot of credibility.

38:15And so we just got through a Fed meeting where I think the Fed did a great job of I wouldn't say the Fed was even close to that lack of credibility. But I think they had a very clear statement on inflation. BOJ has not done so. Also, in the last week, we've gotten a statement out of increased defense spending of three and a half percent of GDP. I mean, all of this says we need to raise rates even more. Do you think they should be going in the world order that we have today? It almost seems as if central banks have had to move a little stronger out there on the ledge. Well, I think, you know, being more open and, you know, being more explicit about how much tightening they want to do this year is really what's going to earn them that credibility.

38:53Of course, following through that was very important as well. So, you know, last time they raised interest rates was back in June. And, you know, we saw the yen actually sell off into fresh multi-year highs off of the move instead of rallying. And that's really what they fear with this move, which is that they raise interest rates and nothing happens in terms of additional yen strength. So what they need to do in order to engineer that yen strength is to be very explicit, not only about the possibility of a one more rate hike this year, but maybe even leave the door open for October tightening.

39:24They don't want to unwind the gains that they've already seen in the yen over the past two months. Does Secretary Best in fact are into any of your forecasts in terms of his role in all this? Or do you think that he is, you know, overstating his power in this market? I think that, you know, while he is overstating his power, the comments by the Treasury, the rate checking has had an impact on the yen. It plays a very big role in the kind of unwind we saw in July and August. So I think, you know, the market is watching for comments. But at the end of the day, it's really action that speaks a lot louder than words.

40:02So we need to see physical intervention combined with BOJ tightening, combined with more aggressive tightening plans by the Bank of Japan. And they need to be very clear about the worries about inflation, about the worry about wages, about how, you know, they don't necessarily see market volatility or geopolitical risk as a concern for, I guess, stepping aside from rate hikes. Kathy, great to see you. Thank you. Always a pleasure. What do the charts say about yen? You know, you can't help but see an ABC corrective wave in dollar yen, which would suggest that. What does that mean? I know. Sorry.

40:40Come on, guys. Yes. An interruption in the long-term uptrend, not a reversal of it. So that is one thing that would suggest that perhaps a low is already in place for dollar yen. But then again, the momentum has obviously deteriorated, right, from a long-term perspective. So I'm a little mixed on it, conflicted. I just think that Japan has a huge problem if you think that you have to match fiscal policy with monetary policy. Fiscal policy in Japan is telling you that there's a lot more pressure on the currency and that it's going lower, meaning higher in nominal terms. So I don't know why the BOJ, except I do know why, why they wouldn't move 50 and make a really clear statement.

41:20The intervention does nothing. The jawboning they've done in the past also does nothing. And so if they really want to get the currency stronger, the problem is that's not great for exporters, is it? Even though they're importing inflation. So I don't think they're going to go 50, but I think there's a problem. But this clears a way to stay long Nikkei. Yeah. Yeah. I'm long Japan. And I devo, we were overweight Japan. I think the Japanese banks look the Japanese banks look interesting. And I think a number of their their kind of A.I. plays look really interesting. I'm long currency neutral Japan, which has been it's having a nice run.

41:55Sticking with it for sure. Tell me up a look at cybersecurity technicals. Katie Stockton is hacking into the charts next. And here's a sneak peek at the Kramer cam. Jim is chatting exclusively with the CEO of Snowflake. Catch a full interview top of the hour on Mad Money. Meantime, more Fast Money in two.

42:18Welcome back to Fast Money. Cyberstocks seeing double-digit gains since just the start of the week as AI security concerns have ramped up. Names like Okta, CrowdStrike, Palo Alto, and Fortinet have more than doubled in just six months. So, Katie, what did the technical say? Momentum, right? So momentum and relative performance. And I think when you look at the Amplify cybersecurity ETF, you'll see just a solid uptrend, very close to new highs. And when you look at that same ETF relative to the S &P 500, you'll see that the ratio has already reached a new high. There's no way to drive a technical objective for the hack ETF, but it does suggest that the underlying should maintain positive momentum.

42:58Names like Palo Alto, Cloudflare is a great one. Okta looks very healthy. We don't have any sell signals at this time. And for the most part, the 50-day moving averages are rising below these stocks, acting as a bit of a trailing stop loss for long positions. And today, by the way, Bernstein downgraded a number of these based on exuberant valuations is the word that they use, Palo Alto, Okta, Sentinel-1. They're all exuberant valuations. It's always been that case in cybersecurity. And you can't write a better script or a narrative right now for a backdrop in an environment where you should need these stocks.

43:35I agree. I got long Cloudflare, NET. And it's already moved on a chart, but it's the most profitable. I should say it's growing revenues at the highest rate out of the entire space right now. Well, I think this is very bullish for studies. I mean, you know, remember when software was selling off, but the cyber software names were still rallying. And I think they're treated differently. I think if you have this kind of momentum behind these names, to me, this is a sign you've got momentum ready to build in the bigger part of that market. So I'm on CrowdStrike. I like it. Valuation does not make sense.

44:08It's amazing. Once upon a time, these stocks were also believed to be AI casualties. They will be replaced by AI. And we still don't know necessarily that chapter yet either, except that these companies are presumably using AI to better their offerings. It is kind of an extraordinary backdrop for them. It's almost COVID-like to a car rental company or something like that. This setup is really good, almost regardless of what happens. So if they slow down, if they don't slow down, all of it. Yeah. However, exuberance, I don't love the exuberance usually in evaluation. And Cloudflare, sorry, just a little button up.

44:45Cloudflare just partnered with OpenAI with one of their models to point out vulnerabilities within their own infrastructure that they didn't even know they had. So to your point that they're not getting replaced by it, they're being additive to the whole entire space, making their product line a lot more attractive to enterprises. Are there individual stocks, Katie, that you like in particular? They're fairly homogenous from a technical perspective. If you look at them, they've been choppy on a short term basis, but that choppiness is yielding higher highs, higher lows. Cloudflare does stand out as a very strong one.

45:16All right. Up next, final trades.

45:33time for the final trade katie stockton well first i have to introduce we have here with us my alma mater it's the university of richmond school and business spiders students and faculty and the dean very excited to have them here today for their student managed investment fund And my trade for today is Intel, I-N-T-T. By the way, all the students here, they've already gotten jobs. It's amazing. Isn't that remarkable? That is remarkable. Tim Seymour. Yeah, I think Home Depot is time to do a job on. I just feel like there's a case where this is such a high-quality name. The home market, there are times we've argued in favor of home equity and whatnot and why this is good for Home Depot.

46:17Karen. Yeah, I'm sure they're very proud of Katie, for sure. Dell, I've got to sell some upside calls. It's been quite a run. Steve. And I think it's commendable that Katie hired them all. It was great. It's a bullish sign of her growth in her firm. So I think I mentioned Cloudflare three times last segment. I'm going to mention it one more time, Cloudflare. All right. Great to have you, Katie. Thank you. Thanks for watching Fast Mad Money with Jim Cramer starts right now.

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