BNN - Wednesday, May 22, 2024 - 03:00 p.m. (ET) - Segment #1

Subscribe now atCRAVE.CA. (Soft electronic music) >> Hello. You're watching the close on bnn bloomberg. I'm amber kanwar were 60 minutes away from the end of the trading day. Here's what we're watching as we count down to the close. And of course, it's going to be a major one with nvidia pulling back after it is set to report quarterly results are as it is set to report quarterly results coming sometime after 4:00pm eastern time. And we've got a power panel to help deal with this as well as snowflake, which is sometimes also in ai. Darling, we'll get perspective with the van until a basket from spare investors. A shareholder, matt hedberg as an analyst at rbc capital snow flakes and gil luria from da david said joining us ahead of all that though, we've got an interview with the head of osfi as they identify risks to the financial system. And a lot of big ones are coming from residential mortgages. Peter routledge will be my guest at 4:00pm eastern time. You won't want to miss that. We've also got a bunch of retail stocks in focus, big miss for target lululemon's head of product out the door, but tjx making a pretty good go of it. All this and more coming up. But first, here's a look. Some of the top stories we're tracking for you right here in the bnn bloomberg newsroom. Shares of cae are under pressure, hitting the lowest level in nearly 2 years. The maker of flight simulators reported preliminary revenue for the 4th quarter that missed analyst estimates. In addition, cae is taking nearly 700 million dollars in charges, mostly due to issues in its services to the defence industry. Canada pension plan investment board earned an 8% return in its latest fiscal year are as double-digit gains in stocks, credit and private equity made up for weaker performance in emerging markets and real estate. The fun recorded a 5% loss in its real estate holdings and live high interest rates and work from home trends. But despite the worst, the chief executive of cpp id says the fund is not abandoning the sector. >> Look at the results over the past few years logistics, huston. Well, data centres are thanks to the ai boom are doing well. Residential, especially in the americas doing well, but then that's offset by challenges in the office space, specifically in the americas and some in europe and retails been challenged for a while. So portfolio today, it's, it's a bit, you know, percent of the cpp investment portfolio. And for us, that seems about right for where we are and will continue to invest and continue real estate as part of the portfolio. >> London drugs says it is willing, unwilling and unable to pay a multi-million dollar ramps in ransom to cyber criminals have stolen data in an attack that shut down its stores for more than a week. Company says the criminals good leak stolen corporate files containing employee information and called situation deeply distressing. London drugs is providing staff with credit monitoring and identity theft protection. Well, markets have rolled over here. We're seeing the tsx down 6 tenths of a percent as we see weakness pretty broad with materials and energy. The key drag this after the materials sector in the highest level in 2 years yesterday. Tech is a bright spot, though we can thank a shares of shopify, which are higher on a goldman sachs upgrade. And as we take a look at the U.S. markets under pressure, part of it does have to do with some micro trends, retail under pressure, some high-profile misses when it came to a target that is pressuring of the broader group. You've got base metals under pressure, tesla's down. But we also got a read federal reserve minutes about an hour ago. And though show that officials are rallying around this higher for entre and around 2:00pm in those minutes came out, the markets took another leg lower, were trading around the lows of the day. (Funky hip hop music)

well, there's a look at the s&p 500 rolling over after hitting all-time highs were down about half of a percent. The catalyst seemed to come from the fed minutes earlier today, where definitely we got a sign that officials are in no rush to cut interest rates some ways it shouldn't be a surprise because we've been hearing this kind of fed cheddar well, last couple of months. And that was really emphasized again yesterday. And of course, this is ahead of nvidia. So you've got the fed on one side, you've got nvidia on the other side set to report blockbuster set of results. And I think I can say that without even knowing what the results are, because the expectation is that they're going to put out more than 200 40%. Sales growth in the quarter generating, but 12 billion dollars in free cash flow for perspective. That number the same quarter a year ago was more than 2 billion. So things have changed a lot for nvidia in the last year. Let's bring in mark sebastian, founder of option pit and cao of carbon live. The setup is intense right now. I think we're focused on the fed, though. Mark, would you agree that's kind of an excuse you know, linger versus a real fundamental reason to sell. >> Yeah, I think what you know, the told us exactly what we've been hearing from the fad. I'm not sure why anybody surprised, but we are getting a little pullback, but maybe they're using these minutes as an excuse to take some money off the table ahead of nvidia earnings tonight. They are the most important earnings definitely this season and probably of the whole year, because I believe the basically the stock market is kind of writing on it. It's nvidia's market, we're all just kind of here for the ride. And they report tonight. >> Well, which brings us to the reaction. I mean, I already said this is going to be a blockbuster set of results and they think there's no denying it will be the wild card is how are investors going to react to it? >> Yeah, I mean, we know there have blockbuster, but what is the outlook like look like, what are their margins? Those are the questions that people will be asking and really what the market is driven on, right? This market really rallied on 2 principles, one ai to interest rates are going to be caught while interest rates are not going to be caught. So now we're still writing we base are riding the ai trained. That is what has been holding up this market. We saw a little bit of weakness that out of that out of some of the other tech earnings, amd in particular did not exactly have the best earnings, even though earnings were great. It wasn't good enough. And that's your fear here with nvidia could go to 1000 on you know, it margins are 80% and they just absolutely blow the doors off could 1000. Yeah, if there are good, then maybe the market continues this path. But what if they're just not quite as good as the market wanted. What does that do? The market and that's kind of where I think the debate that case is where we turn around off these all-time highs and turned back on or under five-thousand. Nvidia disappoints the next few weeks are going to be very tough for the market. I wanted challenge that a little bit because we have seen a broadening out of the rally. Tech is not the only sector up. >> Pretty much every single sector is up, not just in 2024, but over the last month. So I mean, it maybe not as much, but there there there is some some positive returns. >> Yeah, well, since the beginning of the month, what happened? Well, van started to rally. We see interest rates pullback and you can literally run the 10 year over the dow jones industrial average and the and they looked pretty similar. So we've reits rates, pull back a little bit. Rebound. Now we're kind taking that a little bit off the table here. I continue to think there's not to be a rate cut in 2024 but the fed took all of the little bit of that, but we still have I peace. And so I think that if nvidia to point, it is going to cause serious market problems. Now they come in line, they come in a better, you know, a lot better. We could be 5500, we could be 6,000 like that. Why, you know, and decent earnings. We continue on this path of kindess midi slowly rallying bite. On a mess. It is going to be very, very how do you that the pair, what the position for? What I'm kind of position both I think that what I do know here's what I would, how I would play it. I'm not playing it in nvidia itself. I'm looking at the volatility index being 12 foot. Well, 40 and I'm looking at how inexpensive options are in the triple q or in the nasdaq. And I can actually

play nvidia earnings in the triple q rather than nvidia not have kind of that the same exposure to on, you know, that the earnings crush the comes after on an options trade. So my stocks on the nasdaq. I'm buying straight. What would be a call to strangle in our I'm long calls on that are slightly out of the money long puts that are slightly out of the money expiring either friday or on the 31st. >> And that's for an nvidia play. And you have a hedge against a broad market risk. >> Well, then that's the beautiful thing is the kid that q player that s&p play kind of takes care of both because I'm long in out of the money, long on the money call. We take off to 5500. I'm gonna make money. The bay, the bad scenario. I do even better because will see implant vie the vix go up and the market is going to drop very quickly. If these earnings are poor tonight. All right. >> U of s set us up very well. Mark. We've got about an hour to go before those a result a break. Those live for you. You go. There's mark sebastian joining karman line. We're going to take a quick break. Well, ahead of that, there are some other things to contend we've had a big rally in crypto recently, and it seems like a massive sea change is taking place. >> Not at the sec, but in washington's attitude towards crypto. W'll unpack that when Hi, I'm Jessica Katrichak. Coming up on btv. Casino right now has a full feasibility on it. It was done in mid 2022. So quite current. We're taking the project through the permitting stage. It is a very important asset globally. That's what attracted me to the company. It's about 11 billion pounds of copper, a 20,000,000oz of gold. I think this is something that could really put Yukon on the map and would be a driving force of its economy and its prosperity for a very, very long time. Watch us online or here on bnn Bloomberg. ( )Vertical farmingis on the rise. As agriculture evolves,we're harvesting value in ai. Go beyond the obviouswith a global perspective. Agf. Invested in Discipline. ( ) ( ) The infiniti qx60 exemplifies modern luxury. With powerful suv performance, three rows of comfort, and a sleek-yet-daring design. ( ) Lease a 2024 qx60 from 0.99% apr for up to 24 months. Visit INFINITI.ca. ( ) We all strive for peace of mind, whether in life or our investments. But that's not easy with today's market complexity. For over two decades, Goodreid has helped Canadians from coast to coast to achieve their financial goals, through both good times and bad. Working with our portfolio managers, you can navigate tomorrow's financial uncertainty with confidence. It's time. Take control of your wealth. I'm Gordon Reid. Invest with confidence, invest with peace of mind. To learn more,visit Goodreid.com. - [Narrator] The Ninepoint Energy Fund managed by Eric Nuttall. Generating long-term alpha in the energy sector through conviction and access. Number one Energy Fund in the Morningstar energy equity fund category for 3, 5, 10, and 15-year performance. Available under ticker nnrg. >> While the price of a certain cryptos have been moving higher, particularly if as it seem like quite suddenly, the prospect of in the etf in the U.S. was highly probable and many had written it off. And our next guest says that this less about what's going on with the sec is attitude towards the or any other crypto for that matter. And more about what's happening in washington with respect to the attitude towards crypto. Let's bring in catherine valley chief compliance officer and general counsel at bit wise asset management. Catherine, thank you so much for joining let's talk the backstory, what's been going on the last couple of weeks, what's still going on in washington that is catching your attention. >> Yeah, hi and thanks so much for having it has been the tenor has really changed and it's been a pretty dramatic shift because as you indicated, many of us in the industry had given up the thought that there might be an approval for spot east and while we don't know some of the public finds are seeing of amendments of filings coming from direction from the sec would indicate positive signs in that direction. And that's why you're seeing a lot of

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