Right now in fast the bears getting burned the Dow posting its best ain't over a month getting within a stone throw the

35,000 mark for the first time in more than a year. All three major averages at their highest level since last April.

So is it time yet for the skeptics to start changing their tunes? Plus the ultimate full bear debate on Tesla shares up nearly

140% this year at their highest level since last September, but with earnings less than a day away has a stock come too far too fast.

And later a new all-time high for Microsoft bank stocks getting a big boost and why a once hot retail trade caught the eye of one of our traders and not in a good way.

I'm Melissa Lee. This is fast money. We're live with the Nasdaq Market site on the desk tonight. Dan Nathan, Guy Dami and a couple of guest traders.

Danny Moses of Big Short fame. He's a founder of Moses Ventures and Cameron Dawson CIO of New Edge. Well, welcome to you both.

We start off with the market melt up on Wall Street stocks surging to their highest levels in over a year.

The Dow up for seventh straight day is longest winning streak since March of 2021 tech stocks leading the charge the sector the biggest gainer in the day and now at 47% since January.

Check out this chart. Tech valuations closing in on record highs forward P E's or at levels not seen since December 2021 when the world in the market was a very different place.

So with stocks rallying and tech valuations nearing record levels when will the bears throw in the towel and I asked this in the company tonight.

Basically it's a bear down on the desk tonight. So we're going to have this conversation because it's a good one to have when do you say you got to trade the market you have when do you say I'm being too dogmatic about my stance in my predictions as to what is going to happen.

What's great to have Cameron Danny here. There's were sort of safety and numbers I guess tonight but I've been on the bear camp in the broader market for quite some time incorrectly since probably December of last year when this whole thing started but you know valuations were stretched and even more so now and you think about where the world was December of 2021 ish I mean interest rates were so effectively zero the Fed was just going to start to raise interest rates in March 500 basis points later here we are and again the markets going on it's merry way I'm

hard pressed to believe after what's going to be 525 basis points of hikes over the course of a year and a half there's nothing to it there's nothing to worry about there no ramifications nothing is broken and the market goes on it's merry way it just doesn't make a lot of sense to me Danny people came into the year short technology long energy

financials somewhat defensive as was I and over a period of time the chase began when the tech stock started to run people forgot about energy and financials obviously until the March blow up of some of the biggest banks in the country I think about two big events that happened in the first half of the year

first one obviously was Silicon Valley bank silver gate and all the banks blowing up what happened as a result of that that 95% of people didn't see coming was the Fed treasury basic guaranteed all deposits going forward in my opinion that's what they did and they injected half a trillion dollars

into the market second thing that happened was the debt ceiling crisis that happened what happened as a result of that we have an unlimited debt ceiling now through January 2025 those I did not have on my bingo card as a result of that that being said as we sit here today S&P earnings have gone down in 2023 as we've since we've started the year and in 2024 they've gone down since we started the year so it's hard pressed to quote chase the market here that being said I'm sure we'll talk about a later our names you can own and still be bearish on the overall market

right and that's sort of the sense that you take camera you're finding some pockets where you do want to invest but overall you're a little bit cautious yeah and what we've learned this year is that valuations don't matter when everybody's underweight or everybody's short and bearish already which just means that people get drawn into the market kind of regardless of what valuations are but now if we look at we're positioning stands we're at a point where you've seen huge inflows into tech you're now about 75% of the way from going deeply underweight to very overweight

so you still have a little bit of room to run to get to that max overweight position and once you get there that's probably when valuations start to matter and that's why if we're looking at positioning today we're saying we'd rather buy names that are cheaper that equal weight index for example trading out about in line with average versus growth trading well above average

so I think valuation discipline makes a lot of sense if you're looking out to three years but if you're only looking the next couple of weeks the best trends are in those growth state growth the names

yeah yeah I mean no doubt about that and I think though what like really the question is what's the pull for right and so we want to talk about valuations like I'm looking at this is facts that they track you know the forward 12-month PE of the S&P 500 trading near 19 times that's above the five-year average of 18.6 above the 10-year average of 17.4 and Danny just started this conversation by talking about S&P earnings expectations they are still I think expected to be up 2% year-to-year but they're down from where they were massively a year ago or something like that so I say to myself

here you know what are the names that are driving all this performance we know that the seven stocks make up 26% of the S&P 500 we know that they are a disproportion amount of the expected earnings growth for that index that I just told you is trading at historically high levels and then if you think of all the excitement in and around those names they are pulling forward a lot of excitement around something that might or might not materialize in the not so distant future so to your point Cameron these are great trends to invest in this is what investing in technology is all about it

...