Stocks Wrap Up A Volatile Week… And Playing Defense Amid The Market Swings 4/2/26

22:40We haven't gotten any official word about what's happening there. And then the RoboTaxi network, will it expand? They gave us some incremental news in the first quarter about things improving, especially with the Austin service. But generally speaking, it's been quiet, which raises the question, when do we get a catalyst? One other note, when you take a look at shares of Tesla, they also report their energy storage deployed on a quarterly basis. The street was expecting 14 gigawatt hours. That's not what they got. In the first quarter, energy storage deployed was 8.8 gigawatt hours. That's not a huge factor for traders to look at, but it has been a growing part of the Tesla business.

23:20One other note, when it comes to electric vehicles, Rivian also reported its Q1 deliveries today. And one reason that it's up 3%, a little bit better than expected, coming in at 10 ,365. Though, of course, the story with Rivian is R2 production and deliveries. And that's expected here in the second quarter. Guys, I'll send it back to you. All right. Our Phil LeBeau with the very latest on the EV space. Phil, thank you very much. Dan, coming over to you. All right. Tesla missed on deliveries. Does it actually matter for the long term narrative for this company? Elon Musk has basically ceded the EV market to the Chinese and kind of given up.

23:54He's focused on robots and robo taxis. Does this number today really, really matter? No, I don't think so. But I'm surprised it was down five and a half percent on it. And especially, you know, given the way some of these other mega cap tech stocks rallied off of their lows. This did not participate in any means. And I think, you know, we were talking about a little bit last night on the desk. I mean, you know, with SpaceX filing confidentially, I mean, if you're an investor and you love moonshot sort of stories, you know, you're probably going to have to pick. And I think the Tesla story is pretty well picked over.

24:22And I think a lot of folks are maybe going to raise cash in Tesla and kind of move it into SpaceX. But that's a couple months away. All right. Karen, first, your thoughts about deliveries and then obviously the longer term trajectory of the Elon Musk economy, if you will. It's sort of amazing that this, it doesn't matter anymore, right? Jan has talked about this for a while. It's not a car company. It doesn't matter. It's a future earnings company. And I agree with you. I'd rather SpaceX seems far more interesting than Tesla to be right here. I'm, you know, somewhat skeptical of the time frame and the ramp for autonomous vehicles.

24:55The whole part of that story, the SpaceX part of the story, seems a lot more tangible. So that's where interesting to me, I agree that I think it's likely to siphon money away. I don't know. They'll do$75 billion raise. I don't know. So now they're talking about$2 trillion potential IPO. $75 billion, I guess, is enough to trade for people to trade out of this into that. That's what I would do. All right. We do have to move on, but I want to ask you about competition for SpaceX. There was some news today that Amazon bought a competitor, I guess. Did they buy them or were they worried about Global Star?

25:32Yeah, Global Star. Global Star, right. So are you worried about competition in the space? And maybe there'll be some other entrants in there that want to try to get some of this market share. And while Elon Musk and SpaceX are the leaders, there can always be new entrants. I mean, I think it was about a year ago we thought that Chad GPT was the leader. And now we think it's Claude. SpaceX is really, really far ahead. I mean, when you look at the scale of Global Star, I mean, they've got a tiny number of things that they've put into orbit relative. I mean, SpaceX is really far ahead. It's early.

26:01They're kind of where NVIDIA was on chips three years ago. All right. There's a lot more Fast Money to come. Here is what's coming up next. A good defense is the best offense. Why our next guest is prioritizing protection in these market swings and her top safety plays to weather the storm. Plus, a mess in shares of Microsoft, the tech giant leading the Mag 7's losses this year, the underlying issues, and what the company needs to do to turn things around. You're watching Fast Money, live from the NASDAQ market side in Times Square. We're back right after this.

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28:28All three indices snapping five-week losing streaks and posting their best week since all the way back in November. WTI accrued, meanwhile, selling more than 11 % higher, closing at$111 per barrel. That is the highest since June of 2022. And with that set up, Morgan Stanley directing its high net worth investors towards cash and other defensive assets as it waits for the Iran war to end. Kathy Enwistle is managing director at Morgan Stanley Private Wealth Management, and she joins us now right here at Studio B. So cash, you want to get out of the market or is it just a short term situation? Are you advising people to wait for an opportunity?

29:03Yeah, it's more like waiting for an opportunity with the war and the uncertainty of it. We have clients who have already established themselves and they're in the markets. But with new money or cash that's coming in, we're just taking our time. And again, you've got to get in before the war ends. But it's a little bit tricky right now because the volatility is up and down. And it's about trying to find that sort of magic spot to start reentering. All right. We were bouncing this around earlier. I'm sure all these guys have a few questions for you. But do you believe today was a sign that we are at the bottom or near the bottom with the bounce that we saw midday?

29:36You know, I would like to say yes, but it's unclear still, because I do think there's still a lot of uncertainty in Iran and with the war. And even though there's things that are starting to come together, there might still be a little bit longer that we have to wait and be patient. And when you have clients with patient capital, you don't want to take undue risk. You want to think a little bit more thoughtfully about how you deploy their cash at this point. Kathy, energy is one of the sectors you like. It's had a year's worth of move in the last couple of weeks. Is it still a place to be? Is there still more room?

30:07I think there's just a little bit more room there. I don't think there's too much more room, but especially when you're seeing oil barrels going up to 111 and so forth, we're really at a high peak right now. A little bit longer, but I would be a little bit more cautious about entering into that right now. Kathy, by the way, great color scheming. Excellent. Nice to have you next to me in pink. And my name's Biff apparently today, too. So you said something that I think is fascinating, though, especially from the advisory communities. is you have to get in before the war ends. That sounds to me more tactical than I might expect to hear the advisor community say.

30:40I mean, you know, people want to know if there's opportunity here. At the same time, there's many different cliches that are used, but no one gives you the dinner bell to come in and out. So just talk about that feeling some need to get in before the war ends. Well, once the war ends, the markets will have already moved, and then you have missed that movement, right? And so Frank and I were talking earlier even about software. We're still taking our time a little bit with that. But it is down like 33 percent, I think, since October. There's other areas of the market that are ripe for the pickings.

31:14The PEs look good. The opportunities look good. But it's still being a little bit more cautious and taking your time getting in. Because if we do have some more disruptions in the war and politics, that can really hurt a client's portfolio if we do it too soon. For sure. So the market's not a monolith, right? We've had some things that have responded this week. Really, you know, the Mag 7 have had a huge bounce back. Are there other areas that are still pretty down and out where you would get started? I would say we still like financials. We like health care. There's definitely long term opportunities there.

31:50And of course, if you are a long term investor and you've got some time to wait, investing back into tech and things like this is still a great opportunity. The issue is people were worried that AI was going to take over certain roles. And maybe now we're starting to think maybe it's not going to take roles over or positions over or areas over. Maybe it's going to do more of a complement and be more of efficiency rather than replacement. All right. Kathy, we're wrapping up the interview. But before you go, we know we have to ask you one more question. Nickname. Today's the day. Nickname? Nickname.

32:24What's my nickname? Yes. Oh, gosh. Well, my maiden name is McNicholas. I shouldn't even say this. But when I was little, all my friends in middle school called me Pickles because one of the dads called me that. I know. I don't know why. You know what? That's real trust, Kathy. Thank you for helping. It's not like anybody's watching. Honestly, I don't know if I would have done that trust fall. I wasn't prepared to that question. I would have just stayed up. Yeah, I don't know. Good job. Good for you, Kathy. We're going to leave it there. Pickles, it was a pleasure. Great holiday. Thank you. Tim, coming over to you.

32:53One thing she mentioned was AI over software. And we were talking about this earlier. She mentioned software is outperforming since the Iran conflict over the Mag-7, over the market. Cyber security is outperforming. It was kind of interesting that she saw AI over software. What was your take on that part? Well, to me, I'm not ready to jump into software. I still think as a group, there's still a lot of questions. But as we look at AI, I don't think we're questioning demand. I just think the picks and shovels parts of the AI trade are actually clear. It doesn't mean you have to be chasing the higher beta part of the semiconductor space.

33:23But I mean, whether it's a even with an arm or an NXPI or other parts of what I think are more really AI demand, there's no question. Taiwan Semi doesn't scare me here. So I get that. All right. I'm seeing you on my peripheral, Dan. You were nodding a lot. So you agree with that thesis? I agree with everything Tim says usually. The one thing I'll say is if you have disruption of supply chains, if you have disruption of this helium and building this or whatever, you know, semi cap equipment names like continue to work. And I think that's something they caught a bid in the last six to seven months or so.

33:52And I think you think about Taiwan Semi, you think about global foundries, you think about Intel, you know, building fabs. I think it continues to be good for the semi-cap equipment needs. All right. Coming up, the problem with Microsoft. What's behind the drop in the worst performing Mag 7 name this year? Gene Munster, he joins us next to lay it all out. Fast Money back in two.

34:14And welcome back to Fast Money. named Microsoft managing a gain today, but still the worst performing MAG7 name this year, down almost 23 % since January. The tech giant's been pulled down with just the rest of the software sector. The stock coming off six straight months of losses, its longest monthly losing streak since the financial crisis all the way back in 2009. Let's bring in Fast Money friend Gene Munster to break down Microsoft. He's the managing partner at Deepwater Asset Management. Gene, good to see you. Hi, Frank. All right. So what's going on here? Why is Microsoft taking it just so badly out of all the Mag7.

34:48And why are so many doubts about Microsoft kind of developing around the software business when it does have so many other businesses? I mean, it's most basic level. Microsoft is an iconic software company. It's even predates, of course, Salesforce and the whole SaaS business. And so it is that software piece that really strikes a note. There is a little bit of a narrative just around what's happening with cloud. Obviously, Azure is doing exceptionally well, but it has been losing shares lately to Google Cloud. But the real substance of this is around the software business. And just to kind of zero in on that, your previous, Kathy, in the previous segment was kind of talking about the impact of the software world.

35:27But the market is really struggling with what does this mean for seat growth? And ultimately, if knowledge workers do decline, I'm in the view that ultimately that knowledge work will decline. I think it could be substantial declines. If we just look at over the last six weeks, what we've seen from Oracle to Block to Morgan Stanley, Atlassian, those companies on average have cut their workforce by 15%, 1.5. And so, Frank, to answer your question is that what's going on with Microsoft, it's this looming risk that I think that there's that piece of it that's out there. But I also want to inject one other view about why Microsoft has been struggling.

36:09And I think that beyond the conversation about software and knowledge work and what happens with seats, I think there's a more fundamental question about can they make compelling AI products. And if we go back and look at Google last year when it had, it was a year ago, it basically bottomed out. The change was that they came out with a new Gemini model that was beneficial to search, and they really showed that they had the chops in AI. And right now, Microsoft's products are weak when it comes to AI. Co-pilot is marginally useful at best. And I think they really need not only to show that the seat growth is there, but also stand up and say they can create great AI products.

36:51They just simply haven't done that. And the market's reflecting that in their valuation. All right. We talk a lot about AI. A lot of smart people I talk to, they say everybody's got it wrong. They got it totally wrong. AI actually expands the software sector. It doesn't make it contract. And then also I was talking to Robert Smith from Vista Equity Partners last week. He told me the exact same thing. In fact, he said not only does AI expand the software sector, when we're talking about this vibe coding and the use of AI there, that's great when it comes to code. But what about maintaining workflows, testing them, defining them?

37:19There's no way that vibe coding can replace that. Do you agree with that thesis that software certainly still does have a place and it could expand in the world of AI, but maybe it's just the operators that people go to that shifts? Well, I think if you look at just the software world, we're going to see something where the kind of the top 20 % of producers, it used to be this concept that like a great software developer in Silicon Valley was a 10X. They could do 10X what a typical person could do. Now with these tools, those great need to be a thousand X. I think that that potential is there, but just to kind of put some more substance around this is that I think what you're going to see is this kind of thinning out of the need for knowledge work that is just the kind of the essentially the people that are average, I mean, for lack of a better way of saying it.

38:10And so I think that those number of seats are going to go down. I think the people that really embrace these tools, that 20%, is going to find superpowers around their productivity, around some of the vibe coding and other tools that are coming out every week. And so I do believe that when we have the conversation about software relative to the number of seats, seats are going to decline. I mean, I find it hard to imagine a world where two years from now there's more knowledge workers than there is today. Ten years, that probably changes. The education kind of realigns with what the technology is at, but there is going to be a disruption.

38:46And I think that does create this narrative around software, not just Microsoft, and that's not going to go away. All right. Got to ask you one other question. SpaceX, a possible IPO, your view of it, not only the company and the idea of SpaceX being a public company, but about it being an investment, you would imagine it would be in a lot of index funds. I think a lot of people would race out there to buy it. How do you view this potential IPO coming up? Just really exciting. We are investors in it. That's not the reason why it's exciting. The reason why it's exciting is that this company has some of the most unique assets.

39:19Google has some similar views around its unique assets, everything from the silicon to the cloud to distribution, but no one really has these unique assets that ultimately SpaceX has. This is going to be a wild ride. It's going to be a roller coaster right out of the gate because of some of that indexing, but don't let all that noise kind of change the fundamentals here, the opportunity. This is a generational company. if you have the luxury. This is a company to own it and own it for the next decade. All right, Gene Munster, we're going to leave the conversation there. Gene, thank you very much.

39:51Have a great weekend. Thank you. Coming up here on Fast Money, defense on and off the court. Fans locked into the March Madness Final Four this weekend. But there's also a surge in team betting that's causing a lot of concern. The troubling trend on the rise as the sports betting space continues to grow. More fast coming up in two. Also, don't miss our next CBC Pro Live event, Wealth for Women. It's May 28th. right here at the NASDAQ Market site in New York City. Speakers include our own Karen Finerman right here to my right. Limited tickets are still available, so scan the QR code on your screen or visit cnbcevents.com slash wealthforwomen.

40:26Fast Money, back in tune.

40:36And welcome back to Fast Money, an action-packed weekend of college basketball with the March Madness Final Four games on deck. However, there's also a troubling trend on the rise. More teens that get involved in online gambling and sports betting. Our Sharon Epperson has that story. In this personal finance class, the teacher is playing offense. So would it be a good idea to bet if you have only a 4 % chance of winning? Making sure his students understand what's at risk with gambling and sports betting. When it comes to stocks, you can accumulate your money over the years. It's not as risky. A survey of high school teachers from around the country found 83 percent reported observing or hearing of students participating in sports betting or online gambling.

41:25FanDue and MGM Sportsbook. Wow. Sports betting has grown rapidly since 2018 and is now legal in a majority of states. Yet less than a handful of states have adopted academic standards for how to teach the risks and consequences of gambling. Red, how are you feeling right now? I just lost everything. You just lost everything. And if we're not teaching about this to our students, to our most vulnerable students, when are you going to teach it to them, even though they're losing? They're like, this is fun. And to try to get across that gamification of gambling is a very difficult thing to do, because they're just looking at it as entertainment.

42:03They're not looking at the long-term effects of it. Red! Oh, you see? So now you won your points. Yup. High school teacher Brian Suchofsky says if his students understand the financial consequences of gambling, it'll increase the odds of their future success. Sports Betting Alliance President Joe Maloney says the legal industry has zero tolerance for underage illegal betting and supports efforts to raise awareness around responsible gaming. Now, April is Financial Literacy Month. It's a great time to subscribe to my Money 101 newsletter series and share it widely. Use the QR code on the screen or go to CNBC.com slash money 101.

42:44All right. Well, first of all, Sharon Epperson. May I ask you a question? Is there a silver lining here? Understanding that people can get just learning math skills and learning different things potentially. Learning about risk. I mean, on every financial literacy standards survey that's out there, risk is where people, adults, teens, everyone falls short. They don't understand the risk. So I think learning that is really important. And what was interesting in this class was to watch them talk about gambler's remorse, say, you know, what's what's the problem here? Only a four percent chance and you didn't win.

43:21Well, how do you feel? And they're saying I'm disappointed. But really, they're understanding that this remorse has repercussions. All right. Guys looking for the silver lining. It is financial literacy month. Are they also learning about just investing? I mean, they're learning about gambling. What about investing? They're learning about budgeting. They're learning about credit cards. They're learning about investing. And as one of them said, you know, they know the long-term impact of investing is going to be a lifelong impact. They know that there's a quick fix to make money. That's what some of them said.

43:50They think it's free money. They know it's easy money or they think it's easy money. But what they really need to focus on is stocks. That is the next lesson. Oh, wait. Every gambler thinks it's easy money. Sharon Epperson, great story. Thank you so much. Great to have you. Coming up here on Fast, another leg lower in Bitcoin. The token hovering right around 67 ,000. What our traders are watching in the crypto space when Fast Money returns. Stay with us.

44:18And welcome back to Fast Money. Bitcoin under pressure once again, trading with about a 65 handle at its lows of the day. Now at about 67 ,000 crypto connected stocks like Mara Holdings and Riot Platforms. Those were higher today, while CoinShares was just de-SPAC'd yesterday. It sank another 24%. Guy, you're watching a lot of these moves. You're actually worried about not only the moves, but the sentiment, what it means for them. I am, but the worries have been unfounded. But, you know, we thought for a while that Bitcoin, the price, would reach where strategy's holdings were. That happened at 76 ,000.

44:49We're obviously through it now. I thought once that happened, you'd see a follow-on, a knock-on effect in a lot of these AI semiconductor stocks. So I thought the crossover between AI enthusiasts and people that own those stocks are significant. That has not happened. But I think further weakness in Bitcoin at some point is market negative. Dees, I feel like if this was Louise Yamato's looking at this chart, Dees, that she, I mean, we're building a base in Bitcoin for a volatile security or whatever we're calling it. I could almost make an argument that this is exactly the kind of base that Bitcoin wants to put in.

45:23Yeah, by the way, I just want to be clear. D is short for diesel. Yeah. You were going to some West Coast stuff before. They should add subtitles. You've got to make sure. Karen, any thoughts about these moves in crypto? Also, Guy was also worried about the sentiment, the risk-off sentiment, the fact that we're seeing this pressure on crypto. Do you believe that's a bigger concern for the market, the fact that everybody's risk-off? For obvious reasons, though, but still risk-off. Well, the one thing, one of the things that was driving Bitcoin, driving long and I've been long for a very long time.

45:49It's been a rough go this year, or less for more than just this year. But the Clarity Act was really the driver of that huge run. And then at the last minute, you know, it got pulled. And I thought there was going to be a resurgence there. But I think that seems to be off the table. Maybe not fully off the table, but not front and center at the moment. Yeah, at least at this moment. All right, coming up, final trade. Stay with us. We'll be right back.

46:26All right, final trade time. Tim, you're up. Oh, boy. Diesel, Pickles, and Biff, and J &J. Karen? Yes, a firm which has gotten annihilated this year. I think it's way overdone. And thank you for being here, Frank. It's great to be here. Guy? Thanks for being here, Frank. I like Walmart, WMT. Dan, you got the last one. Yeah, volatility is CME Group's friend. All right, thanks for all of you. Thanks for the warm welcome. Thank you for watching Mad Money. Oh, excuse me. Fast money. Mad money. That starts right now.

47:23and it should not be relied upon as such. To view the full Fast Money Disclaimer, please visit cnbc.com forward slash Fast Money Disclaimer.

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