saccoccia energy. >> so it seems a little bit counterintuitive given the fact that oil prices have been pretty rangebound, but we have some optimism around natural gas and around the inflection of that economic activity in the second half of the year. >> jason snipe. >> evercore m&a cycle and deregulation coming back in vogue i like this one here. >> joey, with the last word. >> and that would be charles schwab, which has had a remarkable recovery from where it was in march in 2023. all right. that's going to do it for us. and halftime. thank you so much for watching. the exchange with kelly evans starts right now. >> thank you very much frank. and welcome to the exchange i'm kelly evans. ahead reaching for new records the chip comeback and the tax provisions staring investors. stocks are up again today after that. way better than expected inflation report this morning. and with progress on us-china trade talks, the s&p is now less than 2% from its all time highs. it's up only three

points today. the nasdaq by the way, has turned lower 442 on the ten year. also commerce secretary saying on cnbc that current u.s. tariffs on china are set now and not going to change again. this after the president said a deal is done but still needs final approval. now back to that inflation number. may cpi rose just a 10th of a percent on the month, helped by a big drop in energy prices. but it wasn't just that. the core as you can see there, also coming in cooler than expected. we'll circle back to that in a bit, but let's start with those marathon trade talks between the u.s. and china in london, negotiators emerging with the consensus last night. howard lutnick telling cnbc just a short while ago that we're now in a great place with china. let's get to megan costello at the white house. megan. >> hey, kelly. so there's two very long days of trade negotiations in london that wrapped up just about midnight london time last night, and both sides coming out touting a framework that they now are going to move forward to approve and then implement some details here on what we got from them. china. the top line here is going to grant u.s. companies

export licenses for rare earths. that will add just in the last few moments. the wall street journal has been reporting this hour that those export licenses will be temporary, will only last for six months. the u.s. then, in exchange, if they see china moving forward, will ease up on export controls on things like jet engines will also allow student visas to move forward. the tariff rates will remain unchanged. as you said, that's the u.s. adding 30% so far this year, the chinese adding 10%. and all of this, of course, subject to the approval of presidents trump and xi. now, here's howard lutnick describing the contours of the agreement on cnbc earlier today. >> they are going to approve all applications for magnets from united states companies right away. think of that language right away. you know, very much like the same day. and we're then as they do that, we'll take off our measures and we're in a great place with china.

>> kelly i also caught up with lutnick after this interview, just briefly, and i asked him whether and when we might be able to expect anything in writing, really solidifying this framework. and he sort of sidestepped that question. he told me, remember, what they're doing here is simply cleaning up the geneva agreement. and that's really the upshot here that, yes, this is a step in the right direction. this is positive momentum for these talks to sort of get them back on track, but it doesn't move the ball any further than it was a month ago after those negotiators left geneva. it sort of putting things back where they were. both sides now pledging to implement what they thought they had agreed to in geneva. so now it's a wait and see to make sure we get that approval and to see whether and how quickly both sides move to implement it. >> kelly, i have a lot of questions, but i will put them to our next guest, megan, for now, thanks very much. megan costello, the president, calling this a done deal, but our next guest wonders just how much the u.s. gave up to the chinese in terms of export controls. let's bring in derek scissors, asia economist at the american enterprise institute. derek. so, you know, i find it odd to say

that this is going back to the geneva framework when the rare earth issue only erupted after the geneva framework. >> there's a lot of double talk being issued. now. the president says it's a done deal, but it has to be reviewed. by who? he's the president. and i agree with you. we were told that we had a deal at the geneva framework. we never saw paper on that. now again, we have a deal reinforcing the geneva framework. and apparently secretary lutnick doesn't want to say we're going to see any text showing what that deal is either. it looks very much like this is a temporary truce. the key event here is the chinese saying it's six months of magnet exports. that doesn't mean they're going to cut them off after six months. it means that they're not committed to this after six months, because they've already seen that the deal didn't even last a month. and i think that's the way we have to understand it. on the american side, even though the administration is being coy. >> so who broke the original deal? you know, this really jumped to our attention when all of a sudden the automakers were

saying, we're not getting access to rare earth magnets. and those supplies had fallen by half. but that was in retaliation for what what what was it the simple fact that we put tariffs on the chinese? again, this all came after the geneva agreement. so why did they decide to restrict rare earth magnets all of a sudden? >> it's hard to know who broke the deal when there really wasn't a deal. at some point, secretary besson and president trump were talking about major chinese reforms, and instead we get a six month moratorium on export controls on magnets. i think what happened was the geneva deal was about tariffs, and we got the tariff agreement, and no one has broken it. but neither side thought it restricted their other behaviors. so the u.s. has a lot of complaints about chinese technology theft and coercive acquisition. we move forward on some export controls. and the chinese said, okay, you know, new front and our trade conflict, you have export controls. now we have export controls. so i don't think export controls were covered at geneva and now they've had to add them. >> right. and again, that kind

of just brings us back to this, the state of play a few months ago, because it's not as if the original u.s. tariff dispute with china erupted over their restrictions of rare earth magnets. again, that came later, that came after the fact. so a little bit of the discussion we're having yesterday asking the same question, what is the larger goal here? and if the goal, as secretary besson alluded to in testimony earlier today, is to kind of reshape or or restructure the chinese economy, are we going down that path in a meaningful way? >> i mean, i don't i don't say this lightly. secretary besson is out of his mind. if he thinks we're going to reshape the chinese economy. i don't think he actually thinks that. i think he would like it. i think he thinks there would be advantages to china for doing it. but i don't think he thinks xi jinping is going to wake up after 12 years of being, you know, of his of his cult of personality dictatorship and say, i've been doing the wrong thing on the chinese economy. so the u.s. is going to have to proceed in fits and starts changing our policy and seeing what china's reaction is. that isn't very exciting.

it's not something you want to announce to the press or tweet in all caps. but i think that's what we've seen. we up tariffs. they up tariffs. we have a higher tariff than we did in the first trump administration. so we moved changed our policy there. now we're messing with export controls saying well we're going to keep some export control changes that we've made. we're going to drop others. i think the us policy is incremental. i think that's what it has to be. i think the idea that we're going to get some big change in china is crazy. >> so that all of that said, they have achieved, correct me if i'm wrong, 55% tariff rate on china, which a lot of people going back to the campaign trail and so forth, basically forecast. they said, you know, we think tariffs will probably settle around 60%. and at the time that seemed extremely high. now it seems low. where where does the 55% tariff if it sticks, which letnick said it's not going to change. now is that enough itself to kind of prod the chinese economy in a different direction, or in the us economy as well? >> no, the 55% is the top line for us goods. so the maximum

tariff charge of 55%. ustr greer, i think, used a 49% figure. that's the average tariff. there are a bunch of exceptions in there. we could add more exceptions and keep the 55% top line rate. that is very much something that president trump might be minded to do. we have done very little to nothing public and maybe being done privately on transshipment. so chinese exports to india and asean and a bunch of other countries are increasing, and some of those goods are coming to the united states. we have a higher tariff rate. it doesn't mean nothing. it means something, but it is not nearly enough to change the direction of chinese policy. and i think when we tried to use tariffs alone, it didn't work. so i don't know that tariffs will come down. we may get more exclusions. i do know that china is going to remain the same kind of poor partner that it has been. >> well, and i know the markets are kind of agreeing with you and cheering on both sides of the pacific. it seems at kind of this deal that everything's not going to change really all that much, if we could put it that

way. derek, thanks for your time. appreciate it. thank you. scissors with aei. as all this was happening, a ten year note just went up for auction. let's bring in rick santelli at the cme. and rick, a very different tone than a few months ago when we were much more concerned about the bond vigilantes. >> yeah. you know i'm not so sure i agree with that comment. i think that many of us have been concerned for a very, very long time to johnny come lately seemed to be all vocal lately, from large industrialists to billionaires. but yeah, it's been a long road to higher debt and deficits. but this auction, well, it went pretty well. i gave it a b, as in, boy, let's go through it. 39,000,000,010 year notes. really. it's a nine year, 11 month note because we're adding to the cusip that we opened originally about a month ago. now if we look at what's going on here, the yield at this dutch auction, 4.421, the one issued market was 4.428. so about a half a basis point

improvement. okay. in the screws. it's a good thing. the exact opposite of tailing. and that really was one of the main positive features of the auction. all the other metrics were basically in line. what i did notice was the dealer take down at 9% is the second lowest. last month was a whisker under 9%, but 9% along with last month are the two lowest reads, going all the way back to february of 2023. and i think that's important. tomorrow we finish up with 29 year, 11 month bonds, 30 year bonds, and we'll pay very close attention to that. it seems pretty interesting that 30 year bond has had more attention in the last six weeks than i think it's had in the last six years. kelly, back to you. >> and the market likes it as it sees those yields deflating. rick. thanks very much. dow's up 210 points. bond yields were all over the place with the uncertainty over tariffs inflation and the economy. so what happens now let's ask bob michael. he's the chief

investment officer and head of global fixed income currency and commodities at j.p. morgan asset management. and andres garcia amaya is also with us. he's here on set with me, and he's founder and ceo of zoe financial. andres, i'll just start with you and you can kind of bring the china. you're just listening to that interview with derek there. explain how you think this all kind of moves forward from here from a market point of view. well, one. >> no news is good news when it comes to auctions. i mean, we had our scares recently, but that's obviously a positive for the markets. it's a high functioning fixed income treasury market. and putting it together with with china and tariffs, i think the market went from only focusing on tariffs to now saying it is important, but it's not the only thing that's driving action. economic numbers, the hard numbers are actually holding up just fine. so that story continues and earnings are holding up. in fact eps levels are back to where they were prior to april 4th. and i think that's not surprising that the markets are where they are now on the equity. >> so we're back i'm going to

just call. we're back to all time highs. i mean what's 1 or 2% among friends? incredible snapback. and that just what clears the way for us to continue to, you know, piece together solid gains. >> or i look at it this way. right. so the asymmetry of returns is not as extreme as it was early april. and i was here on the show saying, hey, look, the market crashed really quickly. historically, they tend to bounce back pretty quickly. it happened actually quicker than it usually does. and now then it becomes a question of if the economy, the hard numbers continue to be okay if inflation, i mean, we had a good print if we continue to see prints like that and earnings continue to deliver the momentum on the upside, maybe not the same asymmetry of returns, but it does have that momentum going. >> and underpinning this momentum, bob, has been a helpful drop in bond yields off of those highs that rick mentioned. and why do you think that is and do you expect them to continue falling? >> well, i think today was a pretty good day where you actually could have a better day. we woke up this morning and it looks like china us are coming to some sort of

agreement. the bond market always gets worried about escalation and what that would do to inflation. the cpi report that you referenced was fantastic. you had tremendous moderation in core goods and services. so the market like that. and then lastly, to top it off, you had treasury secretary besson catch a 4 a.m. flight back to the us just in time to bicker with congress. it doesn't get better for a bond investor. >> but when you say it doesn't get better, does that mean yields can't get lower from here? >> no, they can get lower. and i think we're going to see that particularly in the long end. the front end of the curve looks a bit overcrowded to us in terms of positioning. you've got two year yields below 4%. you've got the fed funds rate at four and 3/8. and in the long end you've got the ten year at 442. and the 30 year around 5%. we expect the 30 year auction to go well. it didn't surprise us that the ten year went well. the problem

auctions for the treasury have been the 20 year and the tips auctions. so all of this is good news. we would expect the long end to catch up to the front end. >> okay, so the reason why i'm just going to keep asking, you know, the treasury secretary would love us to be back at 3.90 where we were kind of before liberation day for the housing market. they would love to see yields back below 4%, maybe bring that mortgage rate lower. is all of this a pipe dream as we're up against still the one big beautiful budget bill and all the rest of it bob or does that not matter anymore? because the tone seems very, very different in fixed income all of a sudden? >> well, for sure, he would like to see 390. i'd like to see 390. i don't know how realistic it is this year, because while we all breathed a sigh of relief when we saw the cpi data, so what? we know that tariffs are in the offing. we know that effective average tariff rates are going to be in the mid to upper teens. we know businesses are going to push that through. we don't know

the level of demand destruction. and we don't know ultimately how the fed responds to that. so for now, we'll take stability in the bond market. we'll take high real yields. we haven't had those for a really long time. investors are coming in. they're buying things like corporate credit and securitized. it feels healthy to us. >> and would you agree with that andres. how important are kind of the calmness in the bond market that we've experienced. >> so there are two main drivers right. there is economic growth and then there's inflation. so it kind of if the reason that rates are staying above four is because the economy is doing fine. right. and inflation maybe is what a two and a half handle instead of lower. that's good news right? i would hate to see three and a half because we're in a recession and economic growth tanked. >> exactly. >> so from that perspective, i think i agree. it's like this is fine as long as that doesn't become the story and you see significant volatility, i think the stock market is going to like what they see.

>> quickly to both of you. the president again reiterated, i think even jd vance is now piling on saying the fed needs to cut rates because of the data that we're seeing. you know, 2.3% inflation over the past year is close to target because you subtract half a point, you're there. would you expect or anticipate, andrés, that we get lower rates here, or can they stay as is without causing too much upset? >> i think you have to give credit. this is going to sound crazy because rarely anyone knows. >> about this. i'm about to say the same thing. the number of people saying the same thing all of a sudden who were huge naysayers. go ahead, say it. >> the fed's doing a pretty good job. like it went from being the main story to a side story. i mean, if a year ago we were predicting that all of a sudden the fed was not going to cut more than 25 bips over a year, the world would have thrown mud at the fed. how dare you do that? but here we are, market near all time highs. inflation below 3%, economy doing just fine. now we'll see what they do from here. right. >> but that that would be the only follow on question because

i do tend to agree with you. but do they have to cut in order to keep that? >> i don't think so. i mean, one is look, they have a dual mandate is inflation. and then there's jobs and jobs are okay. i mean, i looked at friday's numbers. they don't look bad enough to have to cut. so they're in a pretty good spot where now they have bullets if they need to use them. but i wouldn't use them just because maybe on the political side they want by the way. and that's not a democrat or republican thing. every president wants the fed to cut. yeah, right. but we have that separation for a reason. and they've done a pretty good job so far. >> bob. same last question to you. >> we think they're going to sit on their hands until you get into the fourth quarter. the two big unknowns are the size and level of tariffs and the impact. and then secondly, what the final shape of the one big beautiful bill act looks like. is it 2.4 trillion. is it 2.6 trillion. once they have that data and see the impact to the economy, then they can respond. >> all right gentlemen, appreciate it today. andres garcia, amaya and bob michael. meantime shares of voyager

technologies. that's our ipo of the day. it started trading moments ago. the space and defense tech company priced above its expected range at 31. wow, friends. andres, do you want to comment on this? why do you tell me, is the market professional priced at 31? it's trading at 70 right now. it's up 130%. what does this tell you? >> it looks like animal spirits are are back. yes. you saw the ipo market open up a little bit earlier with circle and this. so yeah i mean look we're all time highs. it doesn't the wall of worry. we keep climbing it. >> it's gone. >> there's no the more you hate it the more it could keep going up. >> this feels like the final piece of the bull market story. yeah. now that we have voyager. and what was the other one circle the other day? you know, it's not just crypto folks. incredible. open for voyager there. we'll continue to track it. coming up the tesla bounce back that stock trying for a fourth straight day of gains. another sign that animal spirits are back. it's basically where it was before the trump musk feud. although musk is pushing back the robotaxi launch and we'll have the very latest plus. speaking of incredible rebounds, the semi etf, the chips are at

their highest level since inauguration. and look at some of these two month moves. micron up 90% nvidia up 65. we'll dig into this stunning rebound next. into this stunning rebound next. >> this is the exchange on (vo) even the life that's rich with meaning, can take an unexpected turn. and when life brings you change, we have over 100 years of navigating market ups and downs to help guide you with confidence. ♪ at&t business, we guarantee our best deals on any smartphone with your choice of our best plans. what we can't guarantee...your employees having a similar work style. you hired them. or your staff all having the same vibe...

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from the impact of that public feud between musk and president trump. musk now publicly expressing regret for some of his social media posts about the president. and this all comes as the robotaxi event has been pushed back. it's now scheduled for june 22nd, according to musk on x out of an abundance of caution. for more on the stock and drama of it all, let's bring in the wall street journal's tim higgins and financial and cnbc contributor jeff kilburg. i'm going to start with you, jeff. you can boil it down from a share point of view. i'm just curious if you see this as a as a buy or sell moment for a stock that interactive brokers says continues to be probably its single highest volume name. >> i think it continues to be a buy. kelly, if you're short, you are really going to be in trouble here because you're seeing momentum. but this has been sensational. let's go back. just a couple of weeks ago, president trump was giving elon musk a key to the white house, and all of a sudden you saw the most public slap fight of all time. it went nuclear on twitter. and now the richest man is all of a sudden being, you know, conciliatory. and president trump is maybe going to kiss and make up. so as we

see this rebound, as we see the robotaxi event, yes, being delayed, we are optimistic. i think it goes back to where it fell from at 350. but the next leg up is back to 400. so shorts are on the run. >> all right. so tim, i turn to you for the juicy i don't know i don't want to call it gossip, but if you have some feel free to pass it along. what's going on here? >> it seems like we're seeing the return of pragmatic elon musk, right? we saw really, really angry musk last week and now things are cooling off. and kind of the realization of, you know, he's got to make things work with the president. you know, one of the things i think is also very interesting is trump himself has seems to have tried to cool things off with musk. these are two people with huge egos, with mercurial kind of ways of doing things, and musk is a little bit of a threat to trump, and trump is a threat to musk. and so in a lot of ways, you want to see them both go to their opposing corners and try to mend those fences. >> so that said, is it now a non-issue? because the worst case scenario, i would think, if

you're a tesla shareholder, is a vindictive president who suddenly turns his administration against your, you know, hopes on the regulatory front vis a vis robotaxis and all the rest of it. >> absolutely. that is a huge threat that hangs out there. it might not just be the relationship between the president and musk, but what musk's actions do or have done to rile the base or to rile those folks in maga, those folks in the administration who wanted to perhaps, you know, take some vengeance for their boss. so that's one of the concerns hanging out there. and as you point out, musk needs some help here from the government when it comes to rolling out robo taxis across the country right now, there's a patchwork of regulations at the state level, and he has vocalized this desire to have a federal level kind of address, a federal level solution. and don't we don't even going to get into spacex and all the other things he needs help with. >> right. exactly. and that was already raised. so what about the delay of the robo taxi

launch? i know it's just a week in the grand scheme of things, but i don't know, it just feels like a and it's, i think level three autonomy. correct me if i'm wrong. these are not cyber cabs. they're just, you know, existing models that have full self-driving. there's going to be a huge i mean, i'm not trying to be completely underwhelmed by all of this, but how significant is this launch really for the stock, do you think? >> i think it's more significant you're giving a credit to you, but the timing of it is actually immaterial. if you talk about the tesla versus waymo, you're talking about 1500 cars in waymo and potentially 4 or 5 million future robo taxis. so this is step number one. and this may be a very long kind of journey for robo taxi. but i think a bigger deal is this kumbaya moment. i think we have to give a little bit of a hat tip to jd vance. he was the wyatt earp here. kelly. he was the peacemaker that maybe went over and talked to elon to talk to trump. and all of a sudden they're going to kiss and make up. but i think as we move forward, i just bought a tesla. full disclosure, i just bought a tesla 2026 model y, and i used

fsd for 300 miles. i was blown away, and i know i got some gray hair to show and i learned how to drive using a stick. but this fsd technology, if we see another automaker come and license it, there's another leg up in tesla that will rocket through $400. >> i would like to use it myself and i think now's a good time. i almost want to ask how much you paid because you can lease the cars pretty cheaply right now. >> yes. well, good thing i bought the tesla stock down in the one 3140. so the cars paid for itself. kelly. but what's phenomenal about the technology is that you have a little trepidation. i had to see fsd and just being a driver for as long as i've been, i had a lot of anxiety doing it. and after about five minutes i was really comfortable. and after a 300 mile trip, i don't want to ever drive again. kelly. it was remarkable. it's unfathomable. you have to take a test, drive yourself to see it and believe it. >> no, i, i'm a full believer in that as it relates to kind of personal automation, i just the idea that we're going to soon have a fleet of self-driving teslas as reliable as what we've seen from waymo. that feels a little bit further off. >> no doubt about it. but i

think tesla, as we talk about the pure play ai, once they integrate grok into the cabin of tesla, i think the data they're collecting, if they really do get folks like myself who own a tesla to put their car into that robotaxi fleet, that's where this data really goes parabolic, and it gets safer and safer out there. so i'm a believer, but i've been a combustion engine guy for a long time. but now i'm a tesla owner. >> i tried to learn how to drive a stick shift back. and it was it was very, very difficult. hats off to those of you who can do it, tim and jeff. thanks. appreciate it. jeff kilburg and tim higgins today. coming up, defense tech is on the rise in this year's disruptor 50 list. and julia boorstin is up in hudson valley new york with a look at how one firm is using ai to help tackle crime. >> julia kelly i'm here in poughkeepsie at the dutchess county sheriff's office, seeing the work of number seven on this year's disruptor 50 list. lock safety in action. we'll show you how they use drones to fight crime and improve public safety. crime and improve public safety. that's coming it's a smart move to get a second opinion. you do it when you're looking for a contractor.

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>> i guess i'm not the easiest person to please. i like things just right. that's why i love redfin's home recommendations. they know what i want even before i do a home. that's just right. >> yes. >> yes. >> at avocado green mattress, we know that we all deserve a little rest. that's why we're promoting better sleep this season with our certified organic mattresses and bedding. all made with natural, luxurious materials for a healthier planet and healthier you. start your sleep trial today at avocado green mattress.com. >> welcome back to the exchange as we are gainiut 240s now lessn 2% away from the all time highs.

nasdaq lagging somewhat up a 10th and 441 on the ten year yield after that strong treasury auction. here are some of the other movers we're watching voyager technologies popping in its debut today. the shares opened just under $70 after pricing at 31. it's up 111% right now. animal spirits like andrés garcia amaya told us. they're back in this market, it seems. but lockheed martin is among the worst performers in the s&p. on reports, the air force will request only half as many f-35 jets for its upcoming fiscal year versus last year. that's got lmt down 4.5% today and about 18% since the election. different story for nuclear start up oklo. it was conditionally selected to supply power to an air force base in alaska. that's a 25% jump on that development. and palantir hitting another record high back on top as the best performing name in the s&p this year, up 82%. sticking with defense this week, we unveiled cnbc's 13th annual disruptor 50 list, and there are four companies in the

tech space on the list that includes number seven, which is flock safety. julia boorstin is up at fox new crime intelligence center in poughkeepsie, new york, with a look at how they're using ai julia to fight crime. >> hey, kelly. this new crime intelligence center is a partnership between flock safety and state and local police, as well as the dutchess county district attorney's office, flocks license plate recognition software uses ai to help identify stolen vehicles and find missing people and wanted offenders, while it also has audio detection technology that can identify gunshots and glass breaking. >> not only do we use a license plate reader to detect the license plate, we can also detect other characteristics about the vehicle like the color, the make, the model, or is there a dent in the bumper? and that's been really helpful for detectives. >> when someone calls 911 morgan here, a drone pilot can deploy a drone as first responder to

evaluate the threat and whether or not the police need to follow up in person. they can also prepare the officers for what situation they're walking into. drones can also follow vehicles to avoid a high speed chase. >> if we have a thousand cameras, camera streams that we want to monitor, it would take essentially 800 law enforcement officers to monitor those in real time. with artificial intelligence, we can monitor those and just have essentially analysts and a single officer reviewing the alerts. >> now, flock safety is among four defense tech companies on this year's disruptor 50, including anduril, which is in the number one spot and a total of $1.5 billion, has been invested by vcs into defense tech companies just this year, including a $275 million round that flock safety raised in march at a $7.5 billion valuation. at that time, the company announced that its annual revenue hit $300 million,

up 70% from the prior year. you can read more about all of these disruptors at cnbc.com. kelly. >> am i splitting hairs here when i think, you know, we call is it a defense company or is it like a security company of which there are also i know a number of startups doing well. >> yes. so this you could say is defense tech or security tech. if you look at flock safety in particular, their audience, the customers that they're selling to is local police stations. so they're selling to state and city police. and their main, their main business is really selling to counties like this one that are trying to improve and really prevent crime in their areas. >> no. look, i'd love to hear about it. it's amazing to watch this list transform julia and kind of continue to work its way into more parts of the economy that need arguably a productivity boost, so we appreciate it. julia boorstin on site today. yeah. go ahead. go ahead julia. >> oh no i was just going to say

it's just really amazing to think about the potential to do what these police officers were already doing, but at a much broader scale with much more impact and with fewer police officers out there on the field because they have the power of ai, that just multiplies their impact. >> i know i'm trying to resist making like a classic budget high tax comment. like it could help to bring down the cost of running some of these local governments. no, julia, thank you very much. julia boorstin. also, don't miss our interview with the co-founder and ceo of number six on this, this year's disruptor 50 list. that would be eric lyman. that's coming up at 5 p.m. eastern tonight on fast money. and now to leslie picker for the cnbc news update. leslie. >> hey, kelly. yes, the trump administration is pushing mexico to prosecute current elected politicians suspected to have ties with drug cartels. reuters reporting the u.s. is seeking to extradite them if there are criminal charges in the country. the white house didment. leaders at the fbi are looking to move one of the bureau's training academies from virginia to

alabama, according to the washington post. the effort to move the national academy is part of the trump administration's agenda to shrink the fbi's presence in the d.c. area, the bureau said it is exploring options that would be more cost effective but didn't give additional details. and brian wilson, legendary musician and creative force behind the beach boys, has died. his 1966 beach boys album pet sounds, considered by many critics and music historians to be one of the greatest rock concept albums of all time, and his life, as chronicled in the 2014 movie love and mercy. his family confirmed the passing in an instagram post last year. wilson's legal team said he was suffering from dementia. brian wilson was 82 years old. such an icon in his music, of course, will live on for generations to come. but a legend to report today, kel. >> yeah, leslie, thank you very much. coming up, the semiconductors surging off of their april lows. the etf up

nearly 50% while microchip micron stm on semi and nvidia are jumping more than 50%. we'll look at how much room is left to run with the etfs. relative strength index climbing really high into overbought territory 74. highest reading since december. we're back after this. >> cnbc disruptor 50 is sponsored by the new york stock exchange. >> thank you for being innovators in the market. thank you for all you do every day to show what best in class means. >> we are incredibly proud to join the ranks, partnered with this legendary institution. this is such a wonderful place to both get back and look forward. it has been a privilege to be with you. >> is this how you're hoping to retire? well, hope isn't a good

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who can compare in terms of confidence. >> when you're steph curry, there's brand value there. there's brand awareness. >> curry the business of stephen curry. stream now on cnbc plus. >> welcome back to the exchange. we got to just keep talking about this move in the chip stocks higher this week as the us and china strike a deal to ease export curbs. the vaneck semi etf up another 4% just since monday. we've also got nvidia's gtc developer conference in paris this week, with the ceo jensen huang, announcing some new infrastructure deals with europe and making some bullish comments on the future of quantum computing. for more, let's bring in stacy rasgon, senior us analyst at bernstein. stacy, i feel like i sort of keep up with the news. and what's the catalyst for this mega chip move from the lows? >> well, i mean. after liberation. >> day, you know, the chips got hit pretty hard. they're a very global industry, if not the most global industry. and the idea of significant tariffs, not not even on the chips necessarily, but on all of the products that

contain the chips, which is basically everything had the potential to cause a lot of disruption. and so at least for now, as those tariffs have eased, that's certainly helped a lot, right. we've also had a lot of the names reporting and, you know, especially some of the more cyclical names calling for a cyclical bottom in markets like industrial. and then clearly you know you mentioned nvidia. but the ai trade which which had sort of faded is now clearly back on. and so i think it's a combination of all those things. >> i like. >> that, you know, that that that has taken the stock off the off the stocks, off the lows after they got completely whacked in april. >> let me reiterate those three. so for one, we're kind of, you know, resetting the clock and pretending, i guess, like the tariff issue never happened just on that piece of it. right. because look, i think that's a good point though. there's still 55% tariffs on china. maybe that doesn't matter. are there any takeaways from the various layers of tariffs or controls that you know nvidia for instance, the last earnings call was supposed to be all about how much it you know, its china business had struggled because of export controls. is nobody

talking about that anymore. like is that just. >> off the table. so let's talk nvidia on that. so they clearly are. and in fact the export controls have been meaningful. they're losing, you know tens of billions of dollars of business. what is helping them is that the rest of their business is so strong. it's actually okay. i mean, they took they took $8 billion out for next quarter. they guided 45 billion, which was kind of in line ish with the street. but the street hadn't taken china out. if you know if it wasn't for that, they would have guided 50. they would have printed 53 or 54. i mean, i mean, it's insane how strong that is. so that's where they're benefiting. they're they're ramping their blackwall products. i mean, the demand is there. they're going to sell everything that they can get out the door this year. and at least for now, china being taken out is i mean, now you could argue it's the risk, like anything that they can actually manage to sell into china, at least in the near term, will be upside rather than. >> you and your colleague, you know, others who follow the stock have argued. look, look at the middle east deals they just struck. look at what's happening

in the eu. so to your point, they've got that tailwind. then you're saying we also have actually a better improving economy. so simply the cycle we were worried was going to turn for the worse is actually maybe going to turn for the better. >> well, we don't know yet. i mean, what i said is like some of the cyclical names have been calling for a bottom. so take a market like industrial, which has been in a down cycle for like 8 or 10 quarters. so yes, at some point you ought to hit a bottom and hopefully channel inventories are lean. i think the question of sustainability is still still open for debate. right? i mean, because the general some of the macro data points in pmi and everything don't seem all that spectacular. and you know, the tariffs they're on pause for now. but i mean they they they supposedly they're the reciprocal tariffs supposedly come back in august and we're waiting for the 232 tariffs on semi. so we don't actually know if the current strength we're seeing is actually real bottoming or if it's not i mean it could in theory just be pull forward in front of those tariffs. i'd say for now though, things look look better than people had thought. we'll have to see how things go as, as we move into the second half of the year. i don't think

anybody knows yet. >> great point. obviously those benefits, some of the different names we talk about that aren't just i names, but that was the final piece, as you said, that has kind of worked in their favor. the i narrative is very much intact. you know, we say this all the time. i'm a heavy, heavy user of it. more so, honestly, with every passing day. what are the data points that tell you that capex is continuing a pace in that space and should continue to support those? i exposed names, yeah. >> you bet. so i mean, like earlier in the year, everybody was worried that like 25 would be a peak in capex. and like actually all we've seen is cape. budgets go up. actually most of the hyperscalers took the numbers took their capex budgets up. this year. it looks like spending in the next year is going to be pretty good. again, you've got the china dynamics. you know, we'll see if nvidia and all these guys can sell into china or not. but the general spending intentions seem to be fine. and now we have the sovereign stuff that's out there. we have the middle east. a couple of weeks ago we had we had, you know, the european stuff with nvidia out of paris this morning. so you've got that as a as a buffer. so i think

people are less worried now that 25 will be big and even the 26 will be big, i guess, you know in six months we'll all start worrying about 2027. >> oh sure. >> but but for now at least, like into year end things look pretty pretty smooth sailing for these guys. even take broadcom you know like all these guys are talking about increased insurance demand. now as we're actually starting to see usage of ai. and broadcom reported the other day. and they were suggesting some fairly material growth in their ai business not just this year but next year as well. >> right. and to your point, now that we know the three legs of that stool that have underpinned this rally, it also tells us if any of those three starts to wobble a little bit, you know, then we could see this very much go the other way. stacy appreciate that. >> semis right. yeah. that's that's. >> exactly like this is nothing stacy rasgon bernstein appreciate it. speaking of the chips, don't miss an exclusive interview with amd ceo lisa su on closing bell overtime tomorrow at 4 p.m. eastern. and coming up, more signs that ai is reshaping the workforce as google sheds workers, those details and how the industry is

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disruptor 50. >> google is now offering buyouts to employees across several divisions, but including its core search and advertising units, seems to be just the latest sign that tech is reshaping its workforce around ai. deirdre bosa has more in today's tech check. deirdre. hey, kelly. so it's layoffs like buyouts. >> and performance nudges, but that's just part of the story. big tech workforces, they are being rebuilt from the inside out to really reorient around ai. now, the telling part of google's latest buyouts is that it's reaching into its search and ad teams. still, that core profit engine suggesting that legacy roles are being phased out, maybe phased out to make room for different skills and different priorities. now that does mean exits, but also strategic hires and high level reorganizations like alexander wang to meta to lead superintelligence and sema4 just reporting in the last hour or so, google crowning a new chief architect, reporting directly to ceo sundar pichai. now his job it's a promotion. he was already

in google, but it's now to translate raw model performance into real products, and that could be seen as a signal that ai is the new operating system for the company. now, google's memo about the buyouts makes the subtext pretty clear in it, which our jen elias got ahold of, a google executive wrote to employees, if you don't feel aligned, this is your exit path. so in other words, stay. if you're on board with the strategy, or leave quietly if you're not. now, next hour, kelly, i'm sitting down with ceo of databricks at their ai summit in san francisco. he is competing with the likes of google and openai and others for talent. the talent war is heating up, so i'll ask him about how he's thinking about his own workforce in this new era. it is a great lineup here. by the way, just heard from anthropic's dario amodei and jamie dimon. i can see his on stage with ali right now. >> but would you say, deirdre, we can definitively draw the conclusion that this is ai related? that's what's so hard with all of these headlines. right. we had the years of efficiency that were happening

anyway. now you have ai. and so we all want to jump and say, you know, occam's razor. it's because of ai that they're doing that. and maybe that's the case, but do we know that for a fact? >> i would say for me, it feels like a fact because of all the people i'm talking to here and on the ground, it is the one thing that matters the most. and when you have to make way for these massive paychecks, for these white paper ai scientists that are getting, you know, up to $20 million over four years, it seems obvious. it also seems obvious when you read through the transcripts on their earnings call. it really is the thing that is moving everything, especially within companies like google and microsoft and meta and the startups. maybe for some of the others that aren't as all in, it could be used as sort of a front right for layoffs. so that changes. but i think for the ones that are moving most aggressively on this, like google, microsoft, meta, a few others, yes. yeah. but you know, that's we'll see. we'll see if that sticks. >> no, it's a great point, deirdre. for now we'll let you go and we'll see you soon.

deirdre bosa we appreciate it. sticking with integrating ai into the workforce starbucks shares are higher today after saying they're going to launch a generative ai assistant using openai's platform. and it's to help baristas the coffee giant hoping tablets with green dot assist will simplify their jobs and speed up service. so again, it's helping their workforce, which is an interesting trend. starbucks shares, by the way, up 4% for their best day in a month. still ahead on the exchange, we'll look at the provision in trump's mega bill making ripples on wall street. that is, after this quick break. >> tech check is sponsored by comcast business. powering possibilities. >> no city is immune from financial challenges, but with assured guarantees, municipal bond insurance investors bonds can be assured guarantee a stronger bond. >> it is my honor to welcome the hardest working software on

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honest, the decks have made it even better. i'm so happy with it. >> welcome back to the exchange. trump's mega bill is not just changing taxes for americans. potentially. there's a provision that could target foreign investors and it's got everybody's attention. emily wilkins is here now with more. emily. hey, kelly. well, yeah. >> it is being called the revenge tax. and basically tucked inside of the trump mega bill. it would add a tax as high as 20% on foreign capital and multinational corporations. now, the tax is meant to retaliate against not the companies, but the countries that those companies are in that have imposed taxes that the u.s. finds unfair or discriminatory.

think the digital services tax that's been put in place. now, these provisions that have been in the bill, they've really alarmed wall street banks and major companies. but treasury secretary scott bessent has really defended this measure. he just spoke at a hearing today on preventing higher foreign taxes on u.s. companies. >> many other countries would seek to pull in revenues from u.s. multinational corporations into their treasury, and rest assured that the provisions in the one big, beautiful bill to combat this are a staking out of our fiscal sovereignty. >> a lot of discussion on that during that hearing today. but of course, the play is now in the senate. and senators who are working on their tax piece of the mega bill say that it's unlikely that this provision is actually going to be removed at the end of the day. but there are trade groups for foreign

companies and investors that are pushing to make several changes here. that could include pushing back the start date for the provision to 2027 rather than 2026. that gives the treasury more time to negotiate with countries who are considering imposing the taxes. maybe try and find another way. it would also give the treasury secretary further ability to delay taxes for certain countries, to give more time for negotiations, and groups representing investors also asked senators to carve out for foreign investors. make sure make sure that some of those individual investors are not getting caught up in this. and kelly, we are expecting senators to have a meeting on this provision today. we'll of course, be keeping a very close eye on what happens with this and other portions of the tax bill. we're waiting to see that exact tax, that tax that senators are going to send. it could come as soon as this week. >> that would be great, emily. thank you again. as it's getting more and more attention and raising a lot of questions, emily wilkins stocks are off session highs but still ticking higher again today. thank you for watching the exchange. and i'll join brian sullivan to pick

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