Stocks Stage Comeback Amid U.S.-Iran Conflict… And Jamie Dimon’s Credit Concerns 3/2/26

21:42Welcome back to Fast Money. J.P. Morgan CEO Jamie Dimon speaking today with our own Leslie Picker, covering a wide range of topics, including the impact of the Iran war, inflation, AI, and his thoughts on the recent credit concerns. Here's what he had to say.

21:56Karen Finerman:So credit will have a normal cycle. I believe that it'll be worse than a normal one when it happens. So there will be one. And that's because of complacency. You know, asset prices are very high. Credit spreads are very low. I don't think a lot of people have seen a credit cycle. Not everyone who makes loans is very good at it. So those bad actors may be banks, not private credit. Sounds like you're saying nothing to see here, Karen. Well, I'd love for that to be the case. But I think we are going to see a, you know, I think we'll see the normal credit cycle. One thing that maybe people don't think about is J.P.

22:35Morgan and other banks all on the street do lend to private credit. So it's not that they're without exposure. So, you know, the smoother the cycle, the better. Yeah, and I think that was a point he made last week, right, that some people are making dumb moves. And he was talking about competition. And so it's interesting to mention that the private credit, some of the risk taking there or the lack of transparency or, you know, just kind of different quality of credit is not going to be the problem. It's going to be some of his competitors who are lending to them. You know, to me, I don't know enough about this, but when I saw the banks, the money centers in particular, kind of joined the party about a week and a half ago after we saw whatever you want to call them, investment managers, private credit, private equity.

23:14I mean, the swoon that we saw there over the last two months was pretty remarkable. And then when you had the banks start to join that weakness, to me, that was saying something different. On a day like today where you saw a big reversal, I mean, Blue Owl opened down 4 percent after this traumatic move over the last two weeks or so. Apollo, Blackstone, KKR, all of them, and then they reversed higher. It's interesting that JP Morgan did not close higher in a couple other banks. So again, it does feel like a normal credit cycle is probably going to be very different than the last couple we've seen.

23:43And maybe it's going to be a bit more engrossing because you think about how financialized the AI build out has been. And then some of the headwinds as it relates to AI on enterprise software. I mean, you put it all together and it seems like a pretty confusing sort of package. Last year, around this time, American Express made an all-time high, I think, 330-something or so. And then by April, like everything else, it had cascaded lower. Now, that was obviously for other reasons. But in terms of the credit story, look at the move in American Express over the last couple weeks. And if you want to go to the beginning of the year, I mean, the stock is probably down now 23-ish percent from its all-time high.

24:18And that one-day move is probably one of the biggest downdrafts we've seen in a while. To me, that might be a precursor to some credit stuff.

24:24Karen Finerman:I just think banks have had the perfect storm of being also part of just somehow part of an AI trade, too. I mean, banks were suddenly going to be disintermediated. I mean, I'm sorry, but this is a beneficiary for banks. I think it's creating opportunities for blown out, you know, blown out names and whatnot. Having said that, if you look over in the mortgage space, whether it's a Walker Dunlop, whether it's a Rocket, whether it's a Loan Depot. I mean, these are places where you've actually seen very much concern. And it's not software. It really gets into both the consumer and it gets into parts of the mortgage world.

24:55Karen Finerman:So I think you do have a mix. I just think it's nice for the money center banks to say, and Jamie Dimon has been largely right, and there's no question that J.P. Morgan has a position of which they can be conservative because they can be. They don't have to reach out for bad credit. And good for them, and that's why they are best of breed. But I do think a lot of the private credit players have taken a lot of scraps off the table for Wall Street, And I think Wall Street wants them back. Coming up, software stepping up, the group rebounding after its recent rough patch. But can the gains last? And should you be adding these names to your portfolio right now?

25:29You're watching Fast Money Live from the Nasdaq Market Site in Times Square. Back right after this.

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27:13Welcome back to Fast Money Rebound in software stocks today. Amid heavy volume, the IGV, which tracks the group, up more than 1 % today with volume exceeding its 30-day average by 40%. The software ETF now up almost 8 % over the past five sessions. Among the notable gainers today, Microsoft up almost 1.5%, shares up nearly 4 % over the past week. Although, interestingly, Microsoft was on lighter than average volume here, so I don't know what you make of that. Well, you know, there's been a lot of talk after that was Centrini report about how basically AI is going to rip the face off of software.

27:44Well, what's going on right now is that it's ripped the face off the valuations and the way people are thinking about the terminal value of these companies. But there's been a lot of defenses since then. A16Z had one. Bo Gurley was on a Stratechery podcast yesterday. They're saying that there's unusual values here. And people are kind of misunderstanding that there are massive moats for these companies. There's network effects, right? There's switching costs. There's a whole brand. There's a whole host of other things going on. So it really does feel like the folks that are in the trenches, even the ones that are investing most in AI, still feel like there's some great opportunities in the software space right now.

28:17So the one that I have the most exposure to is Zoom communications. And I don't know if you saw, traded down a lot in the Zoom-pocalypse, I mean the SaaS-pocalypse. But I don't know. I find between the huge amount of cash that they have, the anthropic position, when you back those two things out, it's now trading at maybe six or seven times earnings. The quarter was very good. But, you know, one could argue, all right, this quarter doesn't matter. It's irrelevant. We're going to be seeing this in the very near future. Not yet. It's sort of like, you know, being told you have a terminal disease.

28:50You might survive or maybe not. It'll be really bad. That's what that's the sort of, you know, prognosis for some of these. I sort of think of Zoom as a survivor. I want to add I'm kind of inclined to do it, though, with calls to know the downside. Right.

29:06Karen Finerman:I just think Microsoft at this point, which has been dead money for two years and, you know, a lot of pain for people that bought it significantly higher. It's not only at levels on the charts that are interesting, but when you're starting to say you've got a 23 forward handle on this thing. I mean, it's interesting. And I realize that some of their business may be different. But I feel in the broader sense of in the same way we give Apple credit for this installed base, I give the same credit to Office. It's not going anywhere. It may be they may be able to not have to charge as much, but I think they're going to still get their pound of flesh.

29:42Karen Finerman:So, again, I like Microsoft here. Glad you mentioned the volume in IGV, 33 million shares, typically trades 14. And it traded from lows to highs today, which is a good. Listen, last week we said it today helps. I think the low for the short term is in an IGV. Gamia, more market reaction to the Iran war. And why our next guest says the risks to the economy are being underappreciated. And more on that when Fast Money returns.

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30:21Welcome back to Fast Money. Stocks recouping most of their early losses as investors digest the latest developments of the war in Iran. The Dow, which had been down 600 points at the lows, ended the day down just 73 points. The S &P 500 virtually flat, while the Nasdaq gained three tenths of a percent. Paramount holding an investor conference call this morning detailing its acquisition of Warner Brothers Discovery. CEO David Ellison announcing that following the merger Paramount Plus and HBO Max will join to form a single streaming platform which could rival Netflix. And some after hours action, software company Asana topping earnings and revenue estimates, hydrogen fuel cell developer Plug Power higher after posting a beat on revenue expectations, and database software maker MongoDB plummeting after topping EPS estimates and revenue estimates but lowering KeyOne guidance.

31:07Well, even with the muted market reaction today, investors still face geopolitical uncertainty after President Trump said the U.S. is equipped to go far longer than the projected four to five week timeline in the war with Iran. Our next guest says markets are underrating the risks to the end to energy and the economy. For more, let's bring in BCA research chief geopolitical strategist, Matt Gorkin. Matt, great to have you with us. Hi, thanks. Good to be with you. What are the markets getting wrong? Because the markets shrugged it off today. Yeah, they pretty much did. I mean, a 7 percent move in oil.

31:36If you had told people five or 10 years ago that the Strait of Hormuz would be blocked and the U.S. and Israel would conduct a joint campaign to cripple the Iranian regime, they would have thought that the oil price would rise by maybe 30 percent, maybe 50 percent, maybe even 100 percent, given that this is a fifth of world oil flow and 15 or 20 percent of world natural gas in liquefied form. Is the risk, the broader risk to the economy and the markets, does that really stem from a bump in oil prices beyond what we're seeing already? Or is it something else? No, I mean, the Middle East economies make up about 4 percent of the global economy, and they will slow down as a result of slowing investment and uncertainty and some of the damage.

32:20But the real risk here is the oil channel. And the oil is reacting as if we're having a minor shock. But when you look at the profile of the war itself and the actions taking place that are preventing shipping from going through the Strait of Hormuz, that should be a major shock. So what we should see is either that the president declares an early victory and starts to negotiate with the existing remnants of the regime, or the regime is just completely thwarted and rejected in their various attacks and the market moves on, or worst case, and I think the most likely case, the price action has to move back up to price a major oil shock, which is what we seem to be having in the strait.

32:58So Matt, let's play the geopolitical game because China imports more oil than any other nation in the planet. I think it's 10 million barrels a day or something. The majority of it comes from this region. President Trump is supposed to meet with President Xi in April. Does this jeopardize that in any way, shape or form? Yes, this attack definitely jeopardizes their meeting. It could go on, but it could get canceled. There's not a lot of trust between the U.S. and China anyway. And you're correct. About 42 percent of China's oil comes from the Middle East. And this is a stranglehold that the U.S.

33:30is demonstrating that it has over the region. It's not just the direct oil supply, because, of course, the U.S. wouldn't really cut off China's oil unless they were having a war over Taiwan or something. And that's not what's happening. But what's happening is the U.S. is showing that it's the dominant player and that the Middle East will not be a block that's, you know, part of the Eurasian block of the de facto Russian and Chinese alliance that's been taking shape. And in some way, that's sort of what this war is about.

33:57Karen Finerman:But Matt, you know, you mentioned Taiwan. I mean, what does this do between this and Venezuela? The Chinese have carte blanche, right? I mean, can't, especially when we're arguing this isn't regime change and that this is actually really just about specific threats. And in Venezuela's case, they were absolutely regional threats to us. So just talk about China, Taiwan. And is this now something that you put a probability on? What is that? Well, I do have about a one third chance that China uses hybrid or quasi military action to increase the pressure on Taiwan. And that could happen this year or next year.

34:36Over the long run, unfortunately, I think we should be somewhat, we should be very vigilant and very guarded about the situation. I'm afraid that China may not see a pathway and Taiwan may not see a pathway to maintaining good relations without having some kind of significant conflict. But that's way down the road. I mean, what you're witnessing here is that the U.S. is flexing its muscles and taking low-hanging fruit regimes that have already squandered their domestic stability and flexing its capabilities. And then China, you know, invading a mountainous island that's defended by Japan and the United States, that's very costly.

35:12And they've seen the problems that Russia has faced in Ukraine, which should have been an easier invasion. Matt, in terms of what is going on specifically around the strait and the oil infrastructure, what, the strait is closed now. So what are some of the other sort of points of pain that you're looking for to actually get oil prices to spike higher? I mean, is it further hits, for instance, to specific infrastructure sites? I mean, what are we looking for? What will the markets finally react to? Because it seems like the straight-up form moves was a foregone conclusion, or maybe it's because it was de facto shut down already because insurance costs were so high for shippers going through the channel.

35:49Yeah, I think the markets believe that President Trump will wave his wand and sort of declare an early victory and start negotiating quickly like he did in Venezuela and effectively accept that the regime is going to stay in place, but they'll just be at personnel rotation. The problem is that the Iranians face a much more dire situation. And it's in great part because of their destroyed economy and the uprising that's happening there. And the fact that the U.S. and Israel are then going to be attacking the regime from the sky. So the regime is facing existential risk, and that means that they'll continue to strike infrastructure and shipping.

36:24And it could look like what we saw with Qatar. We could see facilities, refineries, ports, pipelines get damaged. That would clearly escalate, and that would push the oil price up significantly. But also just a longer duration of inactivity in the Strait of Hormuz would force the market at some point to recognize that there's going to be a big drawdown in inventories and the price needs to move up. All right, Matt, great to speak with you. Thank you, Matt Burkin of BCA. So do you think the markets are underestimating the risks or are we taking it in stride?

36:58Karen Finerman:I think there's no question that the markets today spoke. And I know tomorrow's, you know, at 930 is going to be a new day. But markets are telling you that right now they don't see those risks, that those risks were out there. Again, this was a VIX that was north of 20 going into the weekend. We kind of knew some of this was happening. I'm not saying that there's no outcome. There's an outcome here that's perfect. But right now, markets see just that four to five percent of global GDP and oil under control. You know, Karen will say, and I'm putting words in her mouth, but a VIX at 21 is sort of no man's land.

37:34And traded up to 23 today. I still think You know, you have these tremors over the last couple months. I still think there's a move north of 28 coming to a theater near you. I don't know what it's predicated on, but I think it's out there in the weeds. What do you actually say about that? I'm sort of agreeing with everything the guy says today. But also, I think we touched on it before. Trump's resolve for a long drawn out is not there. And so I think he is. I don't know what the pain point is, but he'll reach it and then he'll resolve it quickly one way or another. Coming up, cost concerns why skepticism over AI build-out expenses is spooking some data center investors with details when Fast Money returns.

38:19Welcome back to Fast Money. Oracle's five-year credit default swaps hitting levels not seen since the 2008 financial crisis. Investors increasingly concerned over the cost of the company's AI build-out. Oracle stock, meanwhile, was up almost 3 % today. The company expected to report earnings early next week. Dan, you've been sort of voicing concerns over this, particularly after CoreWeave's report last week. Yeah, I mean, listen, we're getting down to the fourth, fifth, sixth players in this thing, right? And so these are the last ones to get these contracts. I know CoreWeave in particular has a neocloud.

38:49I mean, they've had contracts for a while. Microsoft was predominantly that business, 70 % of it. And, you know, as we get to a point where Microsoft has actually, we don't know what the demand is for some of the products. Obviously, Azure is a really important part of their business going forward. But if we do see a pullback in CapEx because there is basically a flattening demand, then the guys at CoreWeave and Oracle, they're in a lot of trouble. And CoreWeave in particular, if they can't get the funding to build out the capacity and they can't fill the deals that they've done, well, then that business goes away.

39:18And I think a lot of the investment case for a CoreWeave is that ultimately they're going to get to a place of profitability and they get a lot of leverage on that build. But I just don't think that's happening anytime soon. There's an odd disconnect, then. The GE Vernova, which is very much tied to this same play, up big. You have another one, Qantas Services, up big as well. So is there going to be all this building or is there not, right? One sector is telling you, yes, absolutely. And the other is telling you, oh, wait, wait, wait a minute. Not so fast. All right. Or is it sort of the, you know, you're going to buy the stocks that are receiving the money as opposed to the ones that have to fund a build out?

39:57And so there's more safety in a GE Brinova and an NVIDIA and, you know, the memory makers, for instance, as opposed to the core weaves of the world. I don't know.

40:08Karen Finerman:Well, I don't think there's any question that safety is where investors have been leaning. And it's just the conversation we were having during the break, which you didn't hear, but we were talking about how the mega cap tech stocks weren't as defensive today or they could have been more defensive in the past when they didn't have balance sheets that had debt that had people start to at least wonder where free cash flow. With Oracle, there's no question people are concerned. Now, part of the rally in Oracle stock today, I think, is also the fact that you had a convert that was priced last week and you had a lot of people selling the underlying.

40:39Karen Finerman:And I think some of this is just kind of share class. That's not what we were talking about. Not at all. Not at all we're talking about. Glad nobody heard during the break. We're talking about Family Affair. The show. Oh, well, yeah. Of a different era. Of a different era. I don't want to. I don't think anybody wanted to really hear about Buffy and Joe. They don't. Sorry. Coming up, how AI is shaking up the investing landscape and how the growth of prediction markets is changing the trading world. The CEO of Moo Moo Trading joined us on that and for his read on investor sentiment. More Fast Money in 2.

41:14Welcome back to Fast Money. As AI's involvement in trading and predictions markets continues to evolve, investor strategy must also adapt. Moomoo is an online trading platform with over 28 million global users and$159 billion in client assets, according to its website. CEO Neil McDonald joins us here on set for more. Neil, great to have you with us. Thank you. What has the retail appetite been for stocks, particularly as there have been so many concerns about AI displacement and credit concerns? I think you'll find that our client base tends to be longer than mag seven. They tend to be very, very well-versed on AI.

41:48With the big rotation that's happened over the last month, you've seen, I think someone described it as a duck market. The index isn't moving, but everything else underneath is kind of moving furiously. You've got 120 plus stocks moved 20%, and the index hasn't moved, right? Great for dispersion traders, but confusing to investors. So that big rotation out of the tech names into the staples and energy. Our clients didn't sell. They were writing calls, writing call spreads, buying puts. But Thursday, Friday, and today, they've been lifting those hedges and using it as dip buying today. So we saw upside buying in NVIDIA, in Tesla, and Amazon today.

42:26Who is your trader? I'm just curious. It sounds like they're very active. It sounds like they use options very often. So what the returns are on their portfolios, too? They amaze me on a daily basis. So you were in the markets for a long-term guy, and retail used to be who everybody wanted to trade against. They didn't have the information, the access, or the tools. So the Internet sold the first one. Firms like ourselves gave you the access, and then social media gave you a distributed help group of people. We've got this big 28-million-person community in the global, and so it's like having a crowdsourced risk management.

43:05You say, what do I do here? And so we find our clients don't panic out. They're more long-term. We have clients who've owned NVIDIA since the end of 2022, 23, and they've never sold. They bought every dip. Liberation Day last year was our biggest single influx of cash.

43:23When I trade by myself, I get FOMO, I get panic out, all this emotional stuff. Having that community means you tend to do that less. Yeah, there's a lot of sophistication without question. And over the last couple of weeks, energy, which nobody was talking about last year, I'm sure a large percentage of your client base has found a way in energy over the last couple of months. Does that seem sustainable to you? It's never. So if I look at our top 10 list, top 10 traded underlies, oil was never there. We saw that creep in. Gold and silver went from for our option trading activity, went from gold was number 25.

43:59five, it got to number five, silver from 15 to number three in our most traded options list. So I think they're opportunistic around where they see movement.

44:09Karen Finerman:What separates you from some of the other new upstart platforms? I mean, other than apparently you love the New York Mets like I do, and you offer all kinds of incentives for people to get to games and have an enjoyable experience, Gaiadami, unlike what's happening in the Bronx. Anyway, why Moo Moo? Why Moo Moo over any of the number of legacy players? There's lots of great companies out there. There's lots of great... I think our difference is the community, which is something you can't build in a day. It's taken us 13 years to build this interactive, like an internal Reddit. I think that's our main difference.

44:42And then talk about retail investors being, when you were a trader, they were the people you'd like to trade against. The progression from having the tools, having the information now, having the risk management, the AI is the next step to really level the playing field. We introduced it last year, and I thought I'm never going to use it, and I use it every single day. Our platform and others have AI, but it's being our investors use it on a daily basis. Great to speak with you, Neil. Thanks for coming in. Appreciate it. Thank you very much, guys. Thank you.

45:13Karen Finerman:Let's go, Matt. Yes, right on. Love that. Wow. I mean, I haven't heard that on our air. Well, you haven't asked. Tim says it, but no one else. You haven't asked. What is it about Guy that everyone looks at? You've been in the market for a long time. He has. It's just like something, you know. But you have also. He's seasoned. Listen, I think what I had to say is really important. I mean, like, yeah, we're fun. We sound smart. We look great. You know, that sort of thing. But at the end of the day, I mean, you know, technology is really changing the game. And it's been democratized. And so have that, people.

45:43Have a ball. Up next, Final Trades.

45:51Final Trade time, Timbo.

45:53Karen Finerman:Yeah. So love me some energy. Love me some upside energy vol to sell calls on the XLE. That's right. Karen. Yes. So my Caspocalypse one, I'll be looking at Zoom calls tomorrow. No pun intended. Just the calls. Dan. Yeah, I'm with you guys on the Salesforce. Zoom, Caspocalypse. I think it's getting a little overdone in CRM. I think you play it, obviously, through IGV without the idiosyncratic risk. It's great that we're all back together again. It's going to be great for us to be back together again tomorrow, Melissa, isn't it? Oh, boy. Excuse me? Anyway. Okay. I'll have an energy TV in. Thank you for watching Fast Money.

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