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tv   Closing Bell  CNBC  December 31, 2021 3:00pm-5:00pm EST

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reform if they choose to do so. >> thank you so much frank, what was the dog has a torn ligament in the knee? >> yeah. he is getting water therapy. so in the weeds of my life he sprained the knee or something. >> we wish them well have a happy new year's eve. we wish you well "power lunch" ends right now "closing bell" starts right now. thank you. welcome to "closing bell." i'm wilfred frost at new york stock exchange this is the final hour of trading for 2021, a year of transitory inflation, memes and the metaverse. we'll he you get the portfolio for 2022. >> welcome, everyone i'm sara eisen happy new year, dubai. we have a look at the fireworks display. >> look at this. >> at the tallest building of
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course in the world. they ring in the new year. just to give you a moment. always a good show in dubai. it is nice to see the celebrations happening again some were paused in the pandemic last year. we are optimistic. happy new year, dubai. ♪ now let's look at three things driving the action leading are real estate, industrials and consumer staples. oil under pressure despite a blockbuster year we have data overseas with china's manufacturing data better than expected. >> i like that i got new zealand and australia earlier today. >> we'll get russia later. >> you will get an extra couple with the late duty tonight i'll be watching from home we are doing our own new year's
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countdown. five top tickers of the cayear cnbc tweet us the guesses now and reveal number five on the list in just a few minutes. also coming up, will the bulls or bears be in charge of wall street in the new year different takes from jonathan golub and david rosenberg. peter boockvar will join us. >> but first up let's take a look at the market mike santoli is here wrapping up the trading year with a wimper why what a strong year overall. >> gliding into the new year keeping it almost all the gains intact the nasdaq above 4800 briefly a few times. we may get there
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remember when the s&p 500 traded below 1,000? i do in 2008 and 2009 and way before that. we added more 1,000 this year in the s&p why total return 29-ish percent. there's this line that was the april into may trajectory. that's been basically where you have defined the upper end of this rally it is gentle right here. we talk about growth versus value. it hasn't mattered that much as long as you invest in the market the equal weighted russell 1,000. yes, ofly growth outperformed. right here at the beginning of november it was a dead heat wr among the three and then with doubts of the omicron, the value
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sectors did add some pressure. it is not that significant what number is hanging off of a two handle with a one-year return. shows you that diversification and involved is what mattered the most most individual stocks did worse. what will come nobody has an idea what does history say? conflicting things but there's a boiling down of the precedents into a composite chart for 2022 with the one-year seasonal affect,the presidential calendar, the 10-year and then the 20-year telling you which year the midterm elections are in expect strength. don't worry about the percentages but about the path of the market and then the sell-off into the sumter is
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weakness before and then after a midterm election if that's relevant you get a good rally. as a matter of fact i believe in the one year following a midterm election the market is never down and then ten months or more to get to that point. >> thank you it is a defensive december check out the performance of the market since the beginning of the month. seen real estate, health care, consumer staples the worst for the year higher by 9% or more in december is this a sign of 2022 joining us by phone is david ro rosenberg. this is your call of a preview in 2022. why? >> look. because you had a -- thank you for having me on the call, sara. we are seeing a tremendous defensive rotation in the s&p 500 beneath the surface.
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everybody talks about how great december has been but when you add up utilities, the reits, staples and health care these are areas to own those areas of the market up more than 9% for the month look we can wax on about what the headlines is doing but a sense of the market you have to dig beneath the surface and this defensive rotation is in play. nobody talks about the fact that the small caps -- the small caps are the pulse of the domestic economy. the small cap stocks are down 8% from the highs they haven't been making new highs. when you add that, the defensive rotation and the flat shape to the yield curve what we are seeing next year is gdp growth downgrade. >> so you are sticking to the bearish guns
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i read the note. you have been negative pretty much all year and the economy is remarkably resill yecent of cov and the pandemic what do you think you got wrong as far as the timing >> look. it is like i said. the eye of the beholder. you can look at the s&p 500 which should be called the s&p 5. this is the most concentrated market on our hands since 1999 and before that 1969 going into 1970 and 2000 we had the same conversation. to quote rule number seven markets are strongest when they're broad. so the point i'm making is the headline index a phenomenal year where i got it wrong is basically look at the past three
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years. this is incredible the s&p 500 has risen at 20% average annual rate. sure, that' six times in the past 90 years but 80% of that heavy lifting is multiple expansion and 20% from earnings. usually both from 50-50. 80-20 in favor of the multiple maybe i underestimated the power of the fed because they had one thing in common which is that the fed is easing monetary policy and rather significantly and started in 2019 and hasn't really stopped until -- well basically now. i think next year is a year of transition and when i say transition i mean away from all the massive policy tailwinds to policy headwinds and i think that's underestimated. $2 trillion. fiscal to monetary stimulus to
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propel the market and the economy this past year i guess what i might have missed is the impact that would have epa won't be repeated next year. with a reversion to the means that's very difficult for the stock market in aggregate because when you do the arithmetic the earnings growth is no match point for point for what the multiple is going to do and the fed is tightening policy into a flat yield curve and so stimulus then next year is difficult and then brings you to i would say a flat to negative year next year that's not a consensus but that's where the numbers pan out. >> david, what about something that doesn't have a multiple at all? what about commodities, the cyclical and the protection
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commodities like gold? >> look. gold is going to have a pretty rough time in the sense that if the fed carries through on raising rates that is not good for the gold price which is inversely correlated to interest rates. look if the fed is the only game in down and raising rates more than the boe, certainly the ecb and bank of japan doesn't do anything that leads to dollar strength and not good for gold and commodities and actually again a missing link in the inflation view for next year people underestimate the extent to which commodities peaking out and they have already a couple months ago and a strzokker dollar to produce an entrenchment in 40% of the cpi called goods and trigger i think
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a much bigger decline in inflation next year than is discounted right now so my sense is that gold -- i can't see barring a major series of geopolitical risks what the story is on gold i'm negative commodities that's a disinflation new next year i think when i talked about the great transition for next year i think it is a year where inflation is going to surprise to the downside so that's why i am still very bullish. >> david, great to see you happy new year thank you for joining us. >> thank you take care. our "closing bell" new year's countdown we'll reveal the number five top searched ticker on cnbc this year plus, many on wall street predicting a comeback for health
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care stocks. a strategist gives us a top pick when we return
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included at no additional cost. all that entertainment built in. xfinity. a way better way to watch. welcome back about 45 minutes left of trading in the year. we are counting down the top
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fiver tickers of 2021. kicking off the list as the fifth most searched ticker is gamestop shares skyrocketed this year the stock on pace to end the year higher by nearly 700% but in the past month the stock down about 20%. mike santoli, the company is still seeing big losses. software sales are declining a lot to prove with the turn around but they have a new management team in place from ryan cohen the founder of chewy. what do you do with a name like this >> first i think there's so many unique circumstances surrounding the company and made it to become the phenomenon. we know about how crowded it was as a short so many retailers were priced to
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extinction it wasn't just this one but this one is as a social phenomenon unique and i think that people have tried to replicate it. remember the silver squeeze movement people thought it was easy to squeeze the shorts they get by and no debt and will survive but the 4,000 stores still i think. there's not much way in the progress and people that rushed in and paid $400 a share at this thing will they be bored or let it wallow with other retailers >> probably most of the searches in the first quarter of the year made it into the top five.
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gamestop up an astounding amount year to date more of that countdown to come in the show. we'll reveal the next one in 10 or 15 minutes. pfizer schahares getting a lift today. joining us is jared holt thank you so much for joining us why don't we cover that news is that significant and drug more broadly going to drive sales for pfizer next year >> thank you for having me i think the pfizer trade with respect to the pill and the vaccines seems like it's coming to a slower end sort to speak. i think so much of this news is anticipated. we know that the governments and the u.s. and also you mentioned the uk and europe and international countries are
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going to be buying the pills to curtail the pandemic as a defensive move but the real world use if omicron is really coming to an end and so many experts say it will over the next month or two roughly then i'm not sure what the real demand is going to be following the procurement from the governments. >> does that apply to vaccines, as well? >> i think so. we have at the point where so many have been vaccinated. we see omicron rip through the states and regions it seems like it will peak in the next four to eight weeks unless there's another variant that we are not aware of and questionable how long the boosters and the vaccines will last through 2022 into 2023. maybe a year, a couple more
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years. i would be shocked if we were here taking the vaccines i don't understand why we would be if the population is impacted or not either way and the variant d dissipates. >> why wouldn't you value similar to a tamiflu even if the extreme pandemic goes awaco vid is with us and people will need to take the pills if they get senior citizen or want to you would think and merck is testing it. if you are exposed you could take it if that works. why is there not a revenue stream for that? >> there might be. again, this omicron variant seems fairly benign for most obviously emphathetically speaking with coronavirus but
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this doesn't seem to have a severe impact on hospitalizations or death so to put patients on a pill for what in many cases is a common cold, maybe a mild flu doesn't seem logical. i received an email from a physician in new york, a primary care physician, month basically said do not take the pill. just take regular medicine. >> why >> i think they believe it's overkill based on the symptoms of the variant and what patients go through if you have very severe symptoms go to the hospital if not dreink some tea. >> it is approved only for high risk individuals we got the point it is an interesting call on how the stocks will do
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jared, thank you. >> thank you happy new year. we have just 40 minutes to go before the closing bell dow is positive in a very historically strong day. s&p 500 just barely positive the nasdaq underperforming and small caps up a little up next, why the rekrocent ralli oil prices is not helping battery powered vehicles bonds are lower across the board. there's a bid for bonds. there's some pressure on yields but the 10-year is above that key 1.50 mark. we'll be right back.
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ev stocks tend to rally when oil prices increase but that has not been the case lately frank holland here to explain why? frank? >> hey there, sara oil prices increased more than 13% in december alone and would increase investor interest in evs but they crashed in december stocks like canoe down 30% workhorse down 20% arrival down double digits and most forecast for oil in 2022 have shown at least doesn't digit increases. for example, bank of america has prices going up about 50%. raymond james with a conservative forecast of 10% but the analyst there says the potential for this kind of volatility in the market will be a catalyst for large fleet operators to increase their ev
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purchases and speed up the plan. wedbush said buy the dip on ev stocks especially coming for commercial use, like life cycle also ppg industries. they are known for paint and do the coating for batteries that need special coatings and an ev infrastructure company already working with fedex back to you. >> frank, thank you so much. gamestop was the fifth most searched ticker on cnbc. number four is next. plus, cannabis stocks have gone up in smoke down 30 pshs this year we'll ask a prominent investor which stocks he thinks look cheap amid the sell-off.
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counting down the top five tickers of 2021. number five was gamestop the fourth most searched ticker this year missing out on a medal but making it in was the dow rallying 19% year to date. the index on pace for the best year since 2019. it is up 5. %, the best of the indices so far this month. i don't know my conclusion on this, mike, oi remember when i moved why do people care so much? price weighted which is silly in my view. only 30 stocks and proven wrong many, many times including today. >> structurally not the way you
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build an index today it is not representative of the investing dollars in the market but when people say what's the market doing the average person means the dow. i think there's a reference point with general levels and the daily moves. there's a good spread and this happens once in a while. the last time the dow reshuffled the membership it cost did dow because it kicked out pfizer and exxonmobil two of the three stocks and raytheon and replaced by amgen honeywell and cost a lot with amgen in there instead of pfizer. >> dow underperformed for a decade or so there's a piece on cnbc on the stocks that wall street is bullish on in the dow.
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nike, consensus there. salesforce goldman sachs in there maybe 2022 is the year for the dow. time now for a cnbc news update with rahel solomon. >> here's what's happening at this hour. actress betty white has died at 99 she had a tv career that won eight emmys. starred in three hits. she was also a regular on many tv game shows including pooshd, match game and $25,000 pyramid president biden commented on her lasting popularity. >> it's a shame. she was a lovely lady. always wonderful. >> always loved betty white. we are so sad about her death. >> 99 years old. my mother would say god love her. incredible.
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iran said the space launch failed to put the payloads into orbit. and another new year's celebration for you. hong kong ringing in 2022 with the countdown and fans cheering on concerts by pop bands back to betty white. she was set to turn 100 in a few weeks and recently given advice about longevity and said she avoids anything green. >> green >> green. >> i hadn't heard that she was recently on the late shows. >> on the cover of "people." >> 99. incredible life. thank you s&p 500 has not closed down on new year's eve in three years. we have up 1 point tech is underperforming.
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>> first, if you look at next year's gdp numbers the real gdp without inflation is actually trailing off a bit recently. mostly because of omicron which is short lived but if you look at the nominal gdp number with inflation that's the way to measure earnings, it is going higher and is up to 7.5% next year and consensus expectations and that's almost double what a normal year would look like so our optimism is not that it's a perfect year but earnings continue to deliver. >> what about the fading stimulus from the fed and the fiscal authorities both in the mode of starting to withdraw that and that could be a headwind for growth and maybe for the marketless because no mat every how you look at the bullishness you have to look at the fed balance sheet over $8
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trillion. >> i agree with you and disagree particularly last year earnings of companies in s&p 500 grew faster than the price the pe multiples, the valuations fell and if you consider like look at where we were this point last year with the new vaccine that was going to do the wonderful things inflation is now an issue. omicron is an issue. you have this tightening that the fed is drivering but a great year in the face of that and the fact that earnings delivered looking at the economic data it understands this and economists are projecting this. it's still includes the fact that we have been withdrawing
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liquidity and forecasting 7% nominal gdp which is fantastic. >> what is more likely next year down year for the s&p 500 or another up year? >> the reality is that it's always more likely to have an up year over a down year. the world economy continues to grow. >> 20% up year is more likely >> sure. if you went back and say take all the years following 20% um years they're positive but can we deliver something that's that stellar? that's unlikely. the 5200 tarktget on the markets calling for a 9% return nest
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year and is still fantastic. >> which is more likely? >> listen. we will have a good year the economy doesn't look like it goes into recession. the fed, what we know from the behavior so far is that as much as they try to renormalize and getting off bond buying and zero interest rates they don't look to crush the economy and crush inflation. even if oin the increment they move off zero. that is what they should have done already it is a sign that things are healthy. they don't look to crush the inflationary problem in a way to damage the economy so i think it's going to be a perfectly solid year and driven not by liquidity and sentiment but by earnings and a decent economy again. >> so how do you play that sp specifically do you buy the russell 2000?
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up 14% only. >> i think sara that is russell 2000 will do great it gets to the point if you look at the last 12 months, the earnings came through much stronger in cyclical companies through strong small every companies and yet tech and big caps led the market. and i think that we're not going to see the same thing and going to be a much broader market in terms of returns it is good for cyclicals talk about small caps. i think they will have a good year and value plays a catch up. the stocks are cheap and expected to deliver like three times the earnings growth in the year ahead than tech and big growth so i think it's going to be a different tone to the market but a solid up year for the s&p. >> jonathan, good to see you happy new year. >> happy new year to you, too.
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a downgrade for peloton and the outlook for energy and crypto in the new year in the market zone and watch or listen to us live on the go with the cnbc app we will be right back.
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banks will remote work at the start of the year. we'll ask if more of corporate america should be taking a page from that strategy book. final countdown, counts down to the top searched tickers on cnbc for 2021 we'll reveal the top three names ahead coming in the second hour of the show. we're now in the "closing bell" market zone. mike santoli is here to break down the trading day and today we have barbara duran with us, as well. let's kick things off with the broader market a mixed picture but all three indexes are strong it's been a strong three-year run. mike, nice fractionally gains today to put us in the green and last couple of days of the year
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is treading water and the hard work was done a week or so ago. >> for sure. not up for the month but coming out of four shakeouts this year that did put a scare into investors, did break the impression that the market on a one way march higher and been healthy. there's been no 5% closing pullback really all year and up almost 30% on the year it was not easy and probably to the benefit and readjust >> there have been 70 record closing highs which is a tremendous number. barb, how do you feel? it's been a good year. 27% gains on the s&p for a third year in a row but some defensive
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moves to pay attention to in december where does that take us next year >> i think the overall market angst is-- action is reassuring and because with up almost 30% you are locking in profits and the high fliers were observe places to go i think that was really more what was going on and see that into the new year. people looking more stock picking for things that's a relative bargain. i think it is positive action and will continue into the new year. >> energy on track to be the best performing sector of 2021 boosted by a strong gain in prices wti crude on pace for the best year since 2019.
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the top performers -- all up more than 100% devin and marathon are the two best in the s&p 500 for the year this is the most hated sector in the market a real comeback. does that continue >> yeah. probably an understatement hated sector looking at the 3% weight in the s&p is underperformed the energy as a sector for 32 years so to have this performance is interesting. i have not been invested in oil but will continue. we'll see demand continue to expand as the economy reopens worldwide and that's been a st stutter step as we know and on supply side there's a few analysts talking about a structural change in supply side and a big thing is that
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companies -- i didn't like oil for a while and part is overinvesting, spending more money and not getting the return on capital now they have religion and focusing on the balance sheet, free cash flow and been several companies including exxon and chevron that committed to return capital to shareholders. that's a real sea change and not investing in projects you cannot see are profitable and will cut out a lot of projects. >> peloton under pressure after a downgrade at j & p securities today. there's data suggesting waning interest in the product just overall a mixed picture for the traditional pandemic winners all down significantly this year and netflix and shopify in the
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green and underperforming the broader market we have discussed this the way in which many winners peaked very early in the year peloton is continuing its weakness and it is amazing how when sentiment shifts how that can prolong and the question is whether it affects the profitable tech names. >> coming to peloton the fact that it's still relatively har hardware centric it is almost a digestion thing and had an acquisition to increase productive capacity down 80% under a $12 billion market cap we talk about it a lot for basically now just kind of a mid cap gadget stock still not on track to be profitable probably some will be
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interesting as they've been cast aside by people who felt like they were only worth owning for a particular window of time. >> what about zoom video, barb this is an i think favorite and a decent call. >> all these stocks i've owned and still own. i didn't peloton but zoom, certainly i wish i sold more at the top price and i have it and the reason is it is still a core holding for me and clients because they have big growth ahead there's pull forward they're in the middle of a transition from smaller customers. businesses underten people to the large enterprises and what's encouraging is that the quarterly report is that they
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had growth of 94% and those customers of revenue over $100,000 they're doing the room they have got huge addressable market so i think a year out, 12 to 18 months you will see 50 to 80% upside on this if not more. >> how do we frame the year or cathie wood and the ark suite of funds? consolidation after a phenomenal multiple year run or a little bit more negative than that? >> i think it is more negative to the sense that the portfolios have what look like blowoff tops in this year and swamped with so much new capital from let's say december of last year to february of this year and doesn't mean it's game over for investing in disruptive innovation i just think there's too many
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new companies came out so there was an issuance and i don't kno that it's a matter to spring back to the same hot streak that ark was on for a year and a half had a great five-yeo run and most of the in the year to february or so of this year. >> big year for crypto bitcoin surging. but the gains pale in come pash s comparison to the others higher for the second year in a row. ripple up. on pace for the best year since 2017 mike, how do you read the gains in crypto? do you putt them in the basket of the ark etfs or spacs or meme stocks >> yeah. i think they coexist on the risk
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frontier with the other types of stocks and strategies. the upside you got in bitcoin specifically this year in the books by the spring and been a challenge from year. a lot of those things as you said that big rush of hot new money that went into the things. it is tough to render on crypto the new coins did outperform and the investor base seems addicted to owning something early. bitcoin was nothing for many years and then more wealth than anything else in history i think that's unclear we don't know about the development and feverish right
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now. >> taken a turn south in the market why the s&p down. the dow down 42. we have got a little over two minutes in the trading day what do you see? >> as you would expect it's a lighter trading day. so it's not really a tremendous rush to the downside volume is skewed slightly negative see the new york stock exchange. really barely more than 2 billion shares very light day as you expect so it's a little bit of a negative tiltd. the treasury yields this year been interesting story taking a look at the 10-year you can draw a line there from january and still an up trend but not managed to get back up to 1.7 that's got the yield compressed in here and do wonder in a new year and people taking fresh eyes on the market
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very small that's rare. keep that in mind as people look for next year. volatility index is inching lower this week. the question is has we come off the low in november into a new up trend and meaning a potentially choppy year in 2022 if we can't get back down to the mid teens. >> we have just under one minute left of the trading year we have lower across the board taking a bit of a leg lower which looks pronounced on an intraday chart we are toward the bottom of the range and a decline of a quarter of 1% for the s&p. 0.6% for the nasdaq. nasdaq just dipping red for the
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week by that move. higher by 4 to 5% for december whereas the nasdaq up 0.7% for the month of december. today staples, tech and communication services we are ending with a trifecta of losses gains for the week for the s&p and the dow and of course resoundingly strong gains for all three on the year. ♪ strong december to boot. welcome back to "closing bell. i'm sara eisen here with wilfred frost and mike santoli chief investment officer peter boo ckvar on the overseas markets. we have a live shot now of moscow ringing in 2022 as we speak. with a fireworks show. should come monmentarily here the world trying to overcome the
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concerns and rising cases of omicron. >> where are the fireworks >> i don't know. we are waiting on it. >> the operator had the vodka too soon, perhaps. >> supposed to be the celebration. keeping an eye on moscow. >> we shall not -- maybe the camera is -- looking at something in the dark. >> there we go happy new year, russia. >> happy new year. >> slightly delayed. there we go. >> look at that. there we go. >> let's run through the stocks. we are going out with gains of 27% on the s&p 500 best perform ore on the game is devin. las vegas names were the worst in the dow home depot, microsoft and goldman sachs are the best
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disney, verizon and bioeing are the worst. barbara duran is still with us mike, how would you sum up the action we went out with a whimper but december was a strong month. we know seasonally strong. this is better the year overall very strong sum it up. >> the year for sure look the majority of the gains we raced ahead in the first 11 months of the year and built up a cushion. led by more aggressive sectors we have had 40 plus percent earnings growth. fresh trillions of stimulus in the year multiple reopening celebrations for the economy. i think all that carried us there. the s&p 500 more or less tracked earnings all year. it's not just the strongest year since 2019 but one of the ten best for the s&p in the last 60.
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it's actually a little stronger leaving open the question of whether there's payback or a moderation in gains. i think almost everyone expects that and taking comfort in the fact that people have a sober outlook about not getting the sights high for 2022. >> chinese tech stocks pulled back today been a rough year for u.s. listed chinese stocks. k web etf down 52% bring in peter boockvar. thank you for joining the conversation and teasing there' a market you prefer to the u.s. next year. i guess from that it will be china. >> if you look at the valuation shanghai come positive it is ten
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times earnings hang seng is at ten times earnings we know why it's trading like that not only the things that you mentioned with china regulatory crackdown and also slowdown in the economy because of what's gone on in the residential real estate market but looking at the world is much -- covid it is china and asia and hopeful after the olympics that china will realize that shutting things down doesn't end covid but temporarily slows it down and could be a different approach and may see a real reopening not in fits and starts in asia like we have had in thei u.s. and europe and looking big picture
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at five to ten years to me the growing middle class story in asia, india,indonesia that is really exciting growth story looking out further and probably quicker growth than in the europe and u.s. >> we could go off on tangents for the rest of the show on this point but while southeast asia has fantastic demographics china doesn't. there's concerns broad question of whether global growth outside the u.s. of could disappoint. >> what i mean growth in china is that the size of chinese middle class in the next five years from 300 million to 600 million people that is a power. demographic in terms of consumer spending on goods and on travel
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and going to be a very interesting growth driver. >> what about the problems in the market the evergrande debts humongous and spilling over. they have also -- i'm not sure what they accomplished. >> the real estate story is going to be a main story that's why the chinese growth rate could be in a real sense and not reported sense 2% next year as they transition away from their overreliance on that and seeing bankruptcies and cleanups and takeovers but it is sort of a needed transition to adjust so i'm not looking in 2022 for a robust growth there but which stock market to outper fortunately and the s&p 500 at 22 times earnings into a global
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monetary tightening cycle i bet that has more of a potential to outperform than the jove valued one. >> will next year be the year for gold and silver? >> why it's so disappointed in 2021 in the face of high inflation is the belief that the fed is tightening and clamp down on inflation but one thing we learned mid-december is while qe is over in three months and a big deal they could raise six times over two years and real rates will still be negative so i'm still very bullish on gold and silver thinking that real rates are negative for a while all over the world and then with central banks tightening is to going to peter
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out relative to other currencies whether it is the ecb in march. >> dollar with a gain for the year that's a strong one. peter, happy new year. >> thank you happy new year. >> barb, we want your top pick going into 2022. what is it >> yes coinba coincidentally enough it is alibaba. the stock is selling near the year low at 120 and if you look at the average earnings they're all over the place but the stock on march '23 earnings selling at 12 1/2 pe. that is cheap. we know that the chinese government slammed them hard and may do so in the future and not
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heard much for four months this is tax selling, esg had to sell this. this is the leading e-commerce company in china they have two of the most popular online shopping sides and the earliest initiatives are starting to gather speed like fintech. and they have a host of other initiatives. like amazon back in the day. investors freak out and say they'll never make money and we know what happened to amazon over the years i think alibaba is discounting the bad stuff and very attractive they have a million initiatives so i think it's probably limited
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downside from here. >> thank you very much happy new year to you. >> happy new year to you thank you. we have breaking news from d.c. ylan >> chairwoman mcwilliams will step down february 4 she led the fdic since 2018. a republican and was appointed by former president trump. she said that banks have been able to maintain robust capital levels despite the pandemic and that the koefr of the financial system is strong however mcwilliams is at odds with the democratic members of the board over climate change and financial risk and stability and the departure paves the way for president biden to reshape
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regulation with the replacement and the fed vice chair for supervision. mcwilliams stepping down effective february 4th. >> this is a surprise. reading the resignation letter nothing particular in it and came on regularly over the last year and execing her to come on again soon and comes as a bit of a surprise that's all i can't add more than that but it wasn't expected. >> yeah. absolutely sles a republican and working in a democratic administration and one would assume a point to leave but certainly the fireworks within the fic with mcwilliams and the democrats spilled out into public and fighting over whether or not to seek public comment on bank mergers, testy public exchanges between the two of them so it
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was seemingly just a matter of time before she stepped down and not getting along with her colleagues. >> i think -- or perhaps they were not getting along with her. one way or the other. >> remember when there was a time to get her to have minutes of the fdic board meetings with a who is tilt takeover in a "the wall street journal" op-ed and clashes on a partisan basis and bank mergers are a more political issue with the democrats wanting to have more public say on mergers and maybe potentially block more she was a trump appointee. possibly awkward there. >> yes thank you for that. just getting started on the second hour of "closing bell." we'll reveal the third most searched ticker on cnbc.
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plus, amazon underperformed the other faang stocks in 2021 an analyst that thinks the stock could rally nearly 20% next year
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for the foster kids who need it most— at we are counting down the top five tickers of 2021 most searched names on this year. so far gamestop at number five dow jones industrial average at four here third most searched is apple. second best perform of the faang names. rally nearly 34% in 2021, mike innovation play on the new products, a defensive play at times. you say it is not indicative of the market but what people want to see from apple next year is new products >> for sure. >> beyond the next iphone, an
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ar/vr headset and how many legs the cycle has with the upgrades to 5g phones. >> the company keeps that carrot in front of the investors with a next iteration of iphone and that story line is intact and becomes kind of a shash holder value machine. 17% is owned by the index funds. company has buybacks warren buffett is not selling any. it doesn't have to grow fast the earnings are not growing very fast. i think the question is retaining this premium valuation right now. 30 times earnings. market seems fine with that smoothing out the cycle where it seems incredibly reliable in terms of constant annuity light
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stream of revenues. >> let's discuss the mega caps more with brent thill. brent, interested to know which of the mega caps that you cover you think has the most upside next year. >> yeah. we like amazon into next year. a lot of investment pulled forward with delivery and logistics this year and hopefully take advantage of the investments in '22 short term there's overhangs on the expense base and think amazon will have a better year we like where facebook sits. especially as we've seen the oculus doing very well and can get new businesses beyond the core and showing levels of innovation i know kids fighting over the
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oculus in my house. >> >> also about 20% upside to the alpha bette price target of $3500 building on a strong year this year, as well. >> google had a phenomenal year. embrace the oddness of google. does well in odd years one thing we would note is it's highly unlikely for google to repeat the performance this year in '22 it is in a great spot. emerging businesses will start to show results with waymo google cloud is third in line and did a really nice job with large corporations embrace
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as well as a call option on the health care side and search is good for google. i don't think it's as good '22 as '21 for the stock last decade is underperformance in the even years and don't blame the messenger. >> outside the faang names what about software stocks and cloud names in particular which underperformed, disappointed people this year. >> yeah. you have a covid hangover. you have a consumption the stocks have a big move and a huge pull forward of demands due to covid so i think it's going to be more of a year of d digestion in '22
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we still really like microsoft and adobe. the pillars of the franchise we like and sticking with the names. we think they'll be grinders microsoft had a phenomenal year. but we don't expect that type of performance going into '22. >> for all the four mega caps to discuss with you, how often do you assess the multiples they have could just collapse overnight or the next year are they vulnerable or safe? >> i think short term safer. you have seen money move into large and defensible business models with microsoft with the cloud business once you go to the cloud you don't take the data out we don't think there's a collapse in multiples. we think that there is headwinds to multiples given the strong
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tailwind we had massive outperformance driven on the numbers and the multiple i don't believe the multiples have room to go on the up but i don't think you see a collapse given how good the demand environment is and the recent covid scare and the holiday plans canceled on the west coast because of this. i think you deal with postcovid hangover that will have maybe some weight on multiples beginning next year but not a collapse in tech multiples in the mega caps. in some other names absolutely seeing stocks 30 to 50 times revenue. you worry more about multiple compression than the large mega caps >> thank you for joining us. >> happy new year.
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>> happy new year. still ahead, second most searched ticker of 2021. pot stocks underperforming the broader market our next guest picks two names return to work debate. we'll discuss what employers should be considering whene w are joined by dr. patel. "closing bell" will be right back
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pot stocks up in smoke this year down double digits. canopy growth down more than 60%. for more on the cannabis play bring in shawn steefl. president biden won and democrats would control both houses for the group and for legislation. and it's been such a disappointment on the regulatory front and i would argue on the stock front. why is that? >> you had investor optimism when you had democrats sweep the senate and had no real tangible progress at the federal level and investors saying how do we find a way to get excited about it and you had that run post
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biden's win and the senate flip and didn't see follow through with the lack of progress in washington creating more questions than answers this year. >> what do you do with that next year can it improve >> it is an interesting dichotomy. if you look under the hood the businesses are more profitable than ever. companies of great management teams, been public and you know which are beat and raise and new york, new jersey and connecticut in the back pocket next year it is robust from growth and a maturation of winners and pulling away and valuations are the lowest on a multiple basis. >> so which stocks do you put in that bracket of being a win every with great management.
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>> largest position is trulieve. phenomenal ceo absolute killer. she knows the customer we think that she'll continue to distance herself from the pack and green thumb industries playing in the right spaces from the brand side, market side and we are excited about the growth prospects. we think that there's multiples of upside from here. >> what about the market share leaders in canada? >> yeah. there's a high level of the market the same size as california and multiples of the u.s. market cap in canada. the thesis didn't play out and seeing there is you had
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companies raise billions of dollars in the euphoric phase of canada and then the canadian market is oversupplied for a very limited customer base you also have an enormous amount of government involvement whether running the stores and lcbo in ontario that is the distribution government run businesses don't do so well especially talking about a new product. >> we have irwin simon on the show a lot from tilray and hope for that and saying look canada's been weak the u.s. is stagnant with regulation and he said the world coming to opening up for cannabis, europe, israel, are we seeing the kind of movement we
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need to see for the stocks to work >> i think we are years away you have development in germany but the european market is very small. south african market is very small. israel is in fits and starts the gem is the united states the u.s. is $100 billion market. 4x from where it is from today in the ten years and next year is new york, new jersey, connecticut, potentially pennsylvania, ohio and virginia moving fast here >> shawn, thank you for the lay of the land on cannabis. >> thank you happy new year. >> happy new year. time for an update with kelly evans. >> in colorado families are returning to homes destroyed by fire this couple found about the only
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thing left standing is the mailbox. the home of one of seven in a row burned to the ground no reports of deaths in the fires that destroyed 500 houses. we'll speak with colorado governor about the extent of the damage and plans to build back join me for that 7:00 eastern. president biden said he made it clear that russian president vladimir putin cannot move on ukraine yesterday and said there would be a heavy price to invade ukraine with severe new sanctions and stronger u.s. presence in the area. there's an arrest in a police shooting. one of two people are suspected and taken into custody law enforcement officials are still looking for the second suspect. back to you. >> thank you so much still to come, a slew of school districts pusher if a new
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in-person start to the new year. we'll discuss with dr. patel and the safest way to move forward first, the two top pick most searched ticker. we'll reveal it next
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throughout the show we have been counting down the top five searched tickers of 2021 on so far gamestop came in fifth. dow jones industrial average fourth apple third why the stock coming in as the second most searched ticker this year is tesla. the company posting strong gains for 2021 for what he expects to see from tesla next year let's bring in contributor tim higgins from "the wall street journal." first you must be on cloud nine. you are "the wall street journal" journalist that covers the stock that's second.
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>> congratulations, tim. >> i mean it's a big year for tesla the first trillion dollar automaker. elon musk becoming the world's richest man. they execute and getting the model 3 and y made in 2018 a question if they could do that. >> and so on that point in terms of execution, i guess we focus on the scaling up of austin, berlin and some eyes on china, too. >> yeah. 2022 is really going to be about momentum keeping that momentum going. it's a stock that's about growth and then needs to show that they can do that. musk promised 50% growth going forward and raising concerns yesterday on twit ter as he typically does claiming a recession in 2022 or 2023 so i think they want to know what he
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is thinking in january when they do their fourth quarter innings call. >> a lot of moving parts there's a battle with china getting angry at spacex for threatening they say is threatening the space station and could have an impact seen tesla in trouble in china in the past and hurt the stock and the recalls announced yesterday. >> yeah. absolutely. >> compared to tesla global delivery where the more negative stories go >> china is a thing to watch for with tesla it's definitely baked into this belief that it can fuel that growth going forward running into trouble in china with the government or with the consumer that is going to rock a lot of people's worlds because they believer that tesla can fuel that growth because of the success in china, the position
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there, because of the growing electric vehicle market there. there's a key thing to watch and then the second issue of concerns of quality of the vehicle just the government in the u.s. being aggressive about autopilot and things that tesla has to address. >> where are we on the cyber truck? >> well, it was supposed to start production this year and now end of next year this is a biggest story of tesla perhaps in the new year. pressure will continue to build until they bring it out. high expectations for it but real lay battle because next week we expect to see general motors all electric pickup truck. ford next year this is the heart of the u.s. market
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this is where the profits in detroit are made and won't cede ground to elon musk. >> beyond the trucks i would ask about competition and what to expect with the other ev players going public with excitement like rivian. >> absolutely from rivian to lucid nipping at the tesla heel just the challenge for musk to continue to bring out new product. he has said that he's going to talk about new product, a preview or an update and that's next month likely with the earnings results and a lot of people looking for that but the s cyber truck is key and a version of a tesla car out there i think analysts want to know that to fuel potentially more growth in the future getting the costs down to make it affordable.
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>> you gave us a lot to watch for. >> thank you. new high just one part of the market with record setting volumes in 2021. mike santoli here to break down the details and an expert's take on omicron and the next steps for businesses and later the big reveal, what the top searched ticker of the year is when "closing bell" comes back
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welcome back let's get over to mike looking at m&a activity which broke records in this past year. mike >> yeah. $5 trillion. that is a record volume for m&a transactions that blue line is how much of the deals were private equity sponsored and that you see is a very high percentage of the overall deal flow. i make the case it is not as high as it seems relative to the size of the economy and the market prior high in 2007 $4 trillion. up about 20% since 2017 levels here's what happened to the total value of u.s. stocks over that same period of time basically tripled. so you have 20% more deal volume
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on a base of quikt capital that's basically tripled from the 2007 levels and globally double to total value compared to 2007 and also somewhat of a lack of transformative deals the $30 billion takeover of kansas city southern not a big number with multitrillion dollar companies so the ingredients are there for a bigger year for m&a if things stay intact. but maybe we're seeing a chill on m&a activity relative to what you expect with regulatory pressure and the huge companies in each industry so dominant that the merge ores have less logic attached to them. >> that number does stand out. >> yeah. >> interestingly even though this considered if two to three
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years, the capital markets performed for the banks, these stocks perform better in the first third of the year than the second two thirds and the question for investment banks is if q1 and q2 shows that's performing to get a leg of performance in the share prices because i think people expect another record year but it can't keep on going. >> the market typically doesn't really want to pay up for the sort of fees rolling in today. it is not going to extrapolate this heavy activity and looking for fed rate hikes to help the traditional business banking lines but if a couple of quarters of heavy activity is a cushion. >> thank you.
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at least three big banks with the employees working remotely up next, whether more corporate motor vehicle should follow the lead "closing bell" will be right back
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the return to remote u.s. daily covid-19 cases averaging 300,000 new cases a day. amid the surge bank of america telling employees to work remotely the first week of january coming after similar moves from citi and jpmorgan jpmorgan saying they're not changing the plan to return to office and expects everyone back by february 1. joining us is dr. patel in washington, d.c. and fellow at the brookings institution and a nbc news medical contributor. thank you for joining us what should the companies be communicating to their employees about remote work and when it will be safe to come back? >> yeah. sara, i think this is a really important time period. january and possibly early february hopefully seeing a peak in omicron cases over four to
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six weeks but until then remote working where possible is safest oeps because i'm sure you know so many people getting this infection and while if vaccinated you are safe and trying to prevent is a lot of unvaccinated people, children who are not vaccinated and immuno compromised people and for those reasons seeing possibly a million plus cases a day with the self report we see with too much of this in the community to go back to work 100%. >> it is just staggering numbers. >> it is. >> in a day. so what about those that cannot work remotely thinking of health care workers and shortages here? already the hospitals are squeezed how big is a problem is this and
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does the cdc guidance help >> it does in our area we have anywhere from a 15 to 40% workforce shortage in health care settings largely asymptomatic but the guidance does help we we don't need any of thoeds to come into an er when we're holding things together by duct tape >> looking forward to hopefully we're past the peak of the
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omicron variant, is it less likely there will be more variants because we will have had so many people who hopefully have herd immunity by that point? >> that's what we're hoping for. we said this with every surge we had. we had omicron that seems to be breaking through the immunity. i'm hopeful we see omicron infections protecting against the delta strain i do think that sign this could be the end of the first phase of the pandemic, which about two years in, i think we're all ready for. >> amen to that. what about hospitalizations, the fact they rising how do wyou read that?
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>> i just had this conversation last night with a colleague in a hospital i said what do we know about our own hospital cases and can't we look at that pcr and look at that gene. there's only certain machines that can pick that up. we don't have an infinite supply not all hospitals have them. we can't sequence everything and we don't need to we are still seeing some delta pu more and more omicron to be honest in about two weeks it will probably be all omicron and it will be very little delta based on the pattern to your point about hospitalizations and i want to stress this, we're seeing a successful decoupling meaning a million cases a day. we're not seeing 3% of those hospitalized like we were with previous surges. we had the sheer number, the absolute numbers even with lower rates of hospitalization are still so high that it's overwhelming the system. on one hand the success of
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vaccines, on the other hand just a sheer failure because of the virus and a strain that we couldn't have predicted. >> dr. patel, the cdc director spoke of people's tolerance as being factor for why the rules were changed a bit what about people's link to that people's willingness to get boosted and be vaccinated going forward even those that have embraced the vaccine from day one. as we get into new year and we hopefully get past omicron whether people's earlier expectations that we get boosted every six months or whatever it might be might fade away because of those communication issues and people's willingness to kind of contboosted. >> there are people that are enthusists of showing up to get vaccines when they are available even for other diseases but they are tired and confused
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the messaging speaks not just to science but to your point, or the fatigue of all of it it's not as high as i'd like but i've seen more people coming into the clinics asking for the boosters it's never too late. add ng the 12 to 15-year-olds next week as we expect the fda authorize for boosters will emphasize that booster are part of the vaccine theory. i think the language needs to shift. boosters seemed optional a key point will be the cdc definition of fully vaccinated this will affect workplaces too. we hope one day we say fully vaccinated is three doses. >> thank you very much it's the big reveal.
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the top ticker of 2021 here's a hint, it's not amc despite so many of you tweeting in that as your guess. we will tell you what it is, xt ne full prescription-strength? reduces inflammation? thank the gods. don't thank them too soon. kick pain in the aspercreme.
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it is the moment we have all been waiting for the number one ticker of 2021. to recap, number five was gamestop there we go. love the sound effect. number four, the dow jones industrial average number three, apple. number two, tesla. number one only two of our viewers on twitter have guessed it correctly the ten-year treasury note the most surged ticker on it doesn't come as a huge surprise to those of us that had to read out. it's surprising. i don't mean that to be an anti- anti-climax. every time i read it out, it surprises me because it's the most boring in the world
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only two years probably more boring because it moves less it's very important, sarah why do people have to search it? it doesn't move that much. >> it's underpinning all these things you're talk about like meme stocks and tesla and apple and everything the story with treasuries was really interesting we saw yields jump by the most since 2013 we had this great bontd bull market >> there's 8,000 stocks out there to beating against each ot other. i'm going to track those five
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tickers and say what if you bought 20% in eempach one of th. a happy and healthy new year to you, mike and to all of our viewers. >> happy new year to every one here is to 2022. fast money begins now. tonight, we just closed out a monster year on wall street. we await the ball drop do you stick with what is working? is it without the old or in with the new strategy diz nig disney very bad year is a magical turn around going to work. a true sign of the times


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