slightly lower on the news. now. there's no formal tie up that we can see between trump media and telecom and trump organization. but again, that's the move that we are seeing right now. and sarepta shares are plummeting after the second death of a patient using its gene therapy drug to treat duchenne muscular dystrophy. sarepta subsequently suspended shipments of the drug for non-ambulatory patients. bmo piper sandler, h.c. wainwright all downgrading the stock guys. so keep an eye on sarepta. i'll send things back over to you, becky. >> okay, don, thank you very much. all right. that about does it for us today. we will be right back here tomorrow. make sure you join us then. right now, it's time for squawk on the street. >> good monday morning. welcome to squawk on the street. i'm carl quintanilla and david faber and sara eisen at post nine of the new york stock exchange. cramer has the morning off. futures near session highs. after a weekend in which oil facilities in the mideast have so far been spared as iran and israel trade missile attacks.

oil's back near 71. busy week with the fed decision. retail sales and the g7 summit. our road map begins with the markets digesting some of these mideast tensions, stocks coming off their worst day in more than three weeks. >> speaking of stocks, here's the us steel. they're going to be up in the premarket. why? well president trump late friday did approve the company's deal to be acquired by nippon. it does require a golden share and gives that to the us government. >> also ahead oil prices pulling back after the israel-iran conflict fueled the biggest one day gains for wti and brant since 2022. >> let's begin with the middle east, of course, on the markets radar, as we do kick off a new trading week. sarah is absolutely right. the focus is going to be on energy today. nat gas a little elevated. but after hitting 78 on friday on west texas back to 71.5. and a lot of notes this morning talking about how maybe markets are over overreacting to some of the tensions in the middle east. >> or underreacting. i mean, oil has this sort of numb effect sometimes to geopolitical risk.

that's been a constant theme for the last few years now. so it was actually a big move that we got on friday. and some might have thought coming in today, we would see oil prices elevated again today just because we're in the fourth day in a row now. it's escalated. but i guess what the market is looking at, david, is that oil supply still flows through the middle east and has not been disrupted. and worst case scenarios for the oil market, i.e. israel going after the energy, the oil infrastructure, the production in iran, which is one of the world's biggest producers, has not happened. iran has not disrupted flow of oil via the strait of hormuz, which is really important for about a fifth of the world's oil. and because that's not happening, oil prices are down again. and we continue this sort of theme of the geopolitical risk just not going into oil like we've seen in years past. >> potentially and potentially not impacting the market. obviously, oil down and the futures are up as as our viewers saw there. so yeah, i think it's

interesting because the prospect of an attack on iran's nuclear facilities, so to speak, where their uranium enrichment facilities and the like certainly has been something the market or market participants have talked about as a possibility for years. i think the expectation would have been a stronger response, a negative response, but it has not happened, at least at this point. and to your point, it's not as though things have calmed down in any way. if anything, they continue to escalate with both sides exchanging ever increasing volleys of, of bombing. >> yeah, there have been some civilian deaths in tel aviv and in haifa. but netanyahu is on the tape this morning, says there is a path to victory. they're on their way to achieving their two objectives, which is removing the nuclear threat and then removing the missile threat. so i guess there is a sense that if they can achieve their objectives earlier, that's less time under

which the markets would be under strain. >> and i think the other reason why maybe market resilient is this growing question about whether the us would participate in any more offensive way. i mean, i think the us has obviously been involved in the defensive help for israel, but the president has made it clear that he still aiming for a diplomatic solution. so maybe one of the goals here is to just pressure iran so far into getting some sort of deal to end its nuclear ambitions on, on nuclear weapons, whatever that is. the fact that the us has not entered in any more decisive, offensive way. i think that's probably calming the market. it's why, you know, you see in the research notes, it remains a limited war between iran and israel, certainly at this point. >> yeah. >> other gulf states also quiet. >> yeah. the uk will be you know, the royal air force is on standby and the uk has advised against all travel to israel and there is some rbc's a good example this morning, lori calvasina, good friend of the show, writes that if you did see

energy prices high and sustained, in her view, worst case would take you back to those april lows, which would be a return trip down about 20%. >> i think the other question, you know, is the other dominant topic that people are wondering about as far as what's next is this idea of regime change, is that what ultimately israel's going for? they have stated, look, i mean, they've called on the people of iran that that's going to be on the people to do some sort of uprising. if the leadership is really weakened further, not necessarily the stated goal here. but again, that's also, you know, how to process that kind of. >> yeah. well, there's been some reporting that netanyahu did bring up the possibility of trying to take out the ayatollah and was told by the president not to do that. so that has not occurred. but in his address, netanyahu did bring up the idea of regime change in terms of addressing the iranian people, which he's done before. >> he says 80% of the people would throw these theological thugs out. the decision to act right, 80%. do we know them? not not sure exactly. but i mean,

what you see on social media and what you hear about, certainly if you have any persian friends, is that they're very supportive. >> well, i think one, one certainly reflection is the fact that the israelis have been able to penetrate so deeply in terms of their spy craft, being able to launch drones from iranian territory. obviously, they had the cooperation of some people on the ground there, without a doubt. and so that does bring up the idea that there are those who are resistant to the current regime. but whether it results in regime change, which would obviously be a very significant deal, i think. >> that's a question. and the us involvement, there's this fordow nuclear facility that is built very deep underground, and it is thought that the us could help finish that job, that experts increasingly have said that israel doesn't have the capability. we don't know exactly. >> i think they don't have access right to those bunker buster bombs. yeah. >> so that's another question that remains. i mean, all of this against the backdrop of this g7 meeting where president trump and his fellow leaders are gathering right now in canada

amid these uncertainties surrounding trade and geopolitics. megan costello is in alberta with the very latest. megan. >> hey guys. good morning from banff here in canada. in alberta, i'm standing just about 20 miles from kananaskis where these leaders were arriving all day yesterday where president trump, we saw arrive late last night off of his marine one helicopter and where leaders were arriving throughout the day yesterday. all seven of the g7 leaders here for the summit this week. and if you take a look at these seven leaders, all of them have been to the white house so far this year, the other six to meet with president trump. so we know he'll be meeting with all of them this week, as well as some other invited officials, the leaders of the eu, for example, australia is here, mexico as well, some others not confirmed yet. so lots of meetings this week. not so many new ones for the president, but the range of issues that he will be discussing is fairly dramatic at this point. the first one, of course, is you guys were just discussing this is happening against the backdrop of everything that's been going on between israel and iran over the past few days, and the president

really trying to sort of tread a line here between steadfast support for israel, but not overtly endorsing the worst of the attacks, sometimes saying israel was acting alone, especially in that first day of attacks. and so sort of threading the needle there, we heard him last night say on his way here to canada, telling reporters that he thinks it's time for a deal. so he's still pushing for that negotiated solution. but he also said sometimes they have to fight it out. so that will be top of mind here. then. the white house has also told us that critical minerals, energy security and artificial intelligence are some of the issues that will be top of mind for them as well in some of these meetings. and then, of course, the biggest issue that we expect to be talked about here is trade and tariffs at the top of everybody's minds, as all of these leaders are looking to strike a deal with the united states before that tariff deadline kicks in. take a look here. this is the size of all of the trade deficits with the six other countries in the g7. you'll notice the uk has the only trade surplus. and it's also the only country that has struck a framework arrangement with the us to hopefully not see

its tariffs kick back in on that july 9th deadline. all of the other countries here want to see something happen, the president told reporters on his way here yesterday that he hopes to see a few new deals. those were his words. he thinks a few new deals coming out of this summit. i can tell you there are bilaterals coming up, one in the next hour with the prime minister of canada, another one tomorrow between the president, president trump and the president of mexico, claudia sheinbaum. so maybe those are the ripest for something to happen. but as for the others, we know the eu has been tricky. we thought japan was close, but those negotiators were in washington this weekend, and those readouts didn't make it look too promising. so still a long way to go. and a lot of skepticism, i would say, guys, but a lot of hope at the same time that maybe something concrete could happen. guys. >> yeah, we had the commerce secretary on a few days ago. he argued that maybe the eu would be last because of the complexity of all those countries. there isn't an indian trade official this morning on the tape, megan, telling the wires that bilateral talks are progressing and that they do

hope to at least have. i think they're calling it an interim deal by july 9th. >> that is the most likely scenario, an interim deal, a framework deal, whatever they want to call it. and we did hear scott bessent say to lawmakers late last week that as long as talks were moving in the right direction, and i believe he called them good faith negotiations, then the us was likely to kick the deadline down the road. but there's still so much uncertainty there that all of these leaders, the ones that are here and the ones that aren't, are really eager to strike some sort of a deal. but at the same time, they're all dealing with their own internal politics. at home. no one wants to look like they're capitulating to the us president. no one wants to look like they met with him in canad, and then got bullied into accepting something that wasn't good for them, for their domestic base. so that's sort of what's at play here. the president has said he wants to see deals. the white house we know wants to see some deals. they want to show that there's progress. these other countries want that as well. but no one wants to give up too much in order to get there. >> how aligned are all of these other countries, our allies, in

the support of israel and the campaign, what it's doing to destroy iran's nuclear facilities and capability? >> at this point, it seems like fairly aligned. i mean, i think most of what we've seen from european leaders over the weekend is somewhat measured support for israel, so similar to the us, and sort of treading that line of saying they support israel's right to defend itself, but also not wanting things to go further. so they're most often, i would say, pushing for a negotiated solution, wanting to see both parties get back to the table. but it's interesting because of course, that wasn't meant to be part of the agenda this week. now, of course, it's going to dominate the discussions throughout the next two days. >> megan. thank you, megan salah in obviously beautiful bamf there. and we'll get more of course as the morning and the days go by here. let's give you some news out of meta. we just got an alert on that whatsapp announcing it's going to be rolling out ads directly on its platform. now, previously, businesses could run what they call click to message ads on facebook or instagram that then linked to whatsapp. while the platform itself remained ad

free, this move is a part of a broader push to monetize that messaging app. the company says private messaging will remain encrypted and ads will not appear in personal chats. the new features will be the updates tab, which is home to both channels and status. and you know, interestingly, guys, as you see, there is a bit of a reaction to meta shares up over 3% right now. we'll see how they perform when we get started with trading about 19 minutes from now. this platform is used more widely, i think, in the business side, certainly in europe, as you know, every every time you step outside the us, everybody just wants the whatsapp. you whatever it. >> we're the only ones that are just like not part of the whatsapp club. >> yeah. so you know it is a powerful platform certainly used here to a certain extent for messaging. but i think the business aspects of it that this will apply to maybe more robust for now, at least outside the shores of the uk. >> it's always been sort of a an option, a call option for meta right to monetize it, which it really hasn't done. i think the, the one question is the privacy

concerns, because the whole thing is that it's encrypted and you don't want any ads, you know, finding out any information about what's in your chats or who's in your chat. >> and the point is to target you as among the advertisers. >> so meta in this announcement is being very careful to say that it's done with complete privacy, and they won't have any access and they won't be selling your information and all of that. but i think the second you see ads in something like this, it does raise those questions. >> promoted channels and status ads, right? >> not an individual. >> chat of your individual chats. yes. >> right. and we'll get to this partnership between roku and amazon on ads, which has roku up more than 9% this morning. when we come back, one analyst take on where oil prices may be headed in the wake of the middle east conflict. take a look at the pre-market. we'll start talking some fed. we'll get the decision friday. of course, markets close thursday, but there's retail sales and claims we'll get to that after a break.

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this morning. wti is coming off what was its highest level since february. this is of course we continue to monitor israel and iran. the continuing continuing hostility. city expects brant to trade around current levels in the near term as that conflict continues. joining us now to discuss is matt, matt slayton, he's citi's global head of commodities research. yeah. max, what do you make of the pullback. does it make sense to you? >> i had thought we would be a bit stronger today. i mean over the weekend some of the betting markets were showing a rising possibility of the strait of hormuz being affected. and yeah, i would have thought it would have been a bit stronger this morning. but clearly there was a lot of short covering, a lot of call buying on friday and no follow through with actual long positions today. >> is the strait of hormuz sort of the key here in terms of monitoring whether this the conflict has extended beyond what is the current back and

forth, and would that have a significant impact on the oil market? >> it is a key. we don't think we think it's highly unlikely that kharg island will be brought into this. and therefore strait of hormuz is the you know, the really the potentially large oil supply disruption if it does happen. i mean, i'd just like to make the point that there's already a very big risk premium geopolitical risk premium in the oil market. we estimate it's around 10 to $12 at the moment. and that risk premium is there for a reason. you know, there's been no real oil export or oil production disruption in iran. and yet the markets trading 10 to $12 higher. and that obviously reflects the potential for there to be a significant if not, you know, if temporary disruption to the strait of hormuz supply. >> what about iran's own oil production, which doesn't appear

to be targeted by israel at this point? but what is the thinking right now in the market about whether that oil will continue to flow and whether there's enough or the political will, for instance, from saudi to make it up? >> yeah. i think the broader backdrop that opec is opec plus is moving to return its barrels is really important to help to explain why there hasn't been any follow through in terms of fresh long positions in the market today. and you know, often people investors, when they're thinking about, you know, putting on a trade they they need not just the short term to be bullish. and you know there's obviously catalysts for higher prices potentially in the very near term. but they also need the medium to long run outlook to be to be bullish. and you know i think you know just just winding back the clock a couple of weeks, many analysts were calling for $50, $40. our 12 month forecast remains 65.

brant. and you know we haven't seen anything that will change that medium to long term outlook which which is still, you know, bearish from these prices. >> max. the other thing we keep looking at and we did this in 19. we did this in 20 for the long term degradation of oil intensity on the economy and as a share of household disposable income. i mean, isn't the lift isn't the bar getting higher and higher over time for oil to truly disrupt markets in general? >> that it is? i mean, i wouldn't want to play it down too much. this does have the potential to get a lot worse in the very near term. and that's why the risk premium is so big, around 15 to 20% of the total crude oil price. and yes, it's certainly fallen as a share of gdp, oil consumption and the value of oil consumption. and certainly in the us, which has shifted to a more, you know,

dramatically more service economy over the last couple of decades. having said that, the us directly consumes about $650 billion worth of oil last year. and, you know, a 10% move is $60 billion max. >> thanks for your time this morning. >> still to come this morning slapping tesla with a sell. we'll talk with the analysts from guggenheim who has done just that. take a look at the premarket here as we do bounce off those levels from friday when we close down on about a 1% pullback. don't go anywhere.

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because what does gina got? gina's got the look. that never gets old. talk about easier investing. up on cnbc plus. >> take a look at some gainers on the index. this morning we mentioned meta and this news about ads on whatsapp. but amd is right behind there. of course we had the product launches last week. today piper says they're relatively enthused about that. they raised some numbers. they go to 140. they were at 125, our opening bell coming up in just a few moments. and don't forget, you can catch us anytime, anywhere. just listen to and follow the squawk on the street opening bell podcast.

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mike, we started the hour talking about why oil is such an important lens to view. what's going on. you agree with that? yeah i do. i mean equities aren't going to overthink it. if oil is not going to add in more risk premium in response to anything like a conflict like we're seeing right now. friday's actually was interesting because the market really did attempt to minimize the impact and sort of s&p 500 trying to hold around 6000 toward the end when we got the retaliation news from, you know, iran was actually actually sending a volley in that had the market give way. and so clearly the market was building in a little bit more of a risk cushion in there. but nothing too much over the weekend has caused it to reprice a lot of risk oil obviously being the main one. and just nothing really knocked the market out of gear. and i think we're two months off of this very, very emphatic low that we got on the tariff panic. since then, risk appetites have rebuilt and the rotations in the market have

been pretty constructive. and we were within sight of the old highs. i just think it was going to take a lot to move the market off that, off that mode of saying like, we can absorb this now, obviously we could be in a position here where at the top of the range, we're looking for excuses to sell off. obviously it's a little more demanding when you get up here. we've already priced in some de-escalation on trade, maybe something on the economic economy remaining resilient. we've got some soft inflation. in other words, we're already pricing in a pretty decent scenario. but i don't think anything that's gone on the last few days fundamentally swings us away from that. >> though some are wondering if the market is complacent at this point, not just to geopolitical risk, but economic risk as well, where you're seeing signs the economy is weakening. nothing dramatic. we'll get retail sales tomorrow and hear from the fed on wednesday. but there's that there's slowing earnings growth and the market keeps making almost new highs. >> i would what i would say about that is we're we've ramped up to levels we first reached seven months ago okay. this this is the price we were trading at on november 7th. and when you

have that situation where it's like, yeah, the market's come back a lot, but it's actually not carving out new ground. and you've had two quarters of way better than expected earnings growth. and the economy has not really buckled just yet. i see why we're here. and i don't think anything in the sentiment profile says complacency. it says that there's hope that's back in the market, but it's not as if we're across the board over aggressively. mike's going to stick around. let's get the opening bell here on this monday and cnbc at the big board at your age. advisor at compliance mandated services in the industrial space celebrating its merger and up listing at the nasdaq. it's lincoln educational services, a provider of career oriented education. ice breath filling in here at the open. you mentioned earnings growth. we do have two weeks left in q2 looking for four almost 5% eps versus 13 in q1. yeah. so we have this constant story of

deceleration. the forecast keep getting eroded. it happened the past two quarters. and then, you know, we had these amazing charts of the earnings estimates are sliding. and then the reports come in and the line goes vertical. and that's happened the last two quarters. and we've gone back to where we thought earnings were going to be months earlier. now do we think that's going to be magically happening every quarter? mega-caps were really carrying the load. they're supposed to be decelerating max seven down to toward 10% earnings growth. so i do think that it's a little it's a lot to ask the market to build more into the valuation before we know whether we're going to be okay here. but so far it's not necessarily causing a lot of panic in corporate guidance just yet. so we're in this limbo state where you can just decide the glass is half full, and that we're not going to see any real impact on the tariffs that we've already seen or the confidence shock that we got in the spring. or you can say, look, it's coming. we just haven't seen it yet. yeah. although barry knapp this morning writes maybe it's maybe tariffs are bringing forward disinflation because the

demand destruction happens and then prices fall. >> i mean maybe inflation has been under pressure i think just nobody knows including the fed whether we're going to see the inflation pressure in the second half. i've read ten notes over the weekend about how inventories are elevated at retail. and so there's no incentive to pass on price increases. and that will eventually wear down over the next few months. i mean, shree kumar, who i always follow, you know, kumar srikumar, who runs his own shop on bonds. he's saying the fed should be hiking rates right now to get ahead of anticipated inflation. and then, you know, steve englander this morning at standard chartered says, well, now there's an increased chance of a 50 basis point cut in september because, you know, that's the first real live meeting and inflationary pressures down. so nobody knows i think how the tariffs are going to manifest. >> and that's why it is this eye of the beholder situation. right. it's what you're describing. and i think it does make a lot of sense even on oil. there's this counter argument that says, okay, let's say this

is what we have in terms of this conflict. let's say it sort of stops here. well, you've probably said iran back on its nuclear program. whatever you thought the risk long term was going to be is diminished. and therefore supply demand can swamp oil prices and maybe even becomes a benefit. i don't know if that's the case, but that's a storyline that's getting into the market and why people don't want to get overexcited about the bounce in in energy stocks, but also say if you look closely enough within the market, if you look at consumer goods relative to the s&p 500 stocks that are tied to consumer goods, they performed poorly. they basically, you know, they've lost whatever outperformance they had months ago. so the market is trying to take account for the fact that you are going to see tariff impacts, whether it's in their margins or it's, you know, in pricing or it's just lower volumes, and that's just the way it's going to go up. i did. >> want to transition guys to us. steel, a name that i've been talking about a lot, i know for a very long time. in fact, it's

over 19 months ago that nippon announced that it was buying u.s. steel at $55 a share. but as i've been reporting of late, despite what was a lot of perhaps confusion out there, nippon steel is going to close its acquisition of us steel at the $55 a share, and that will happen in the next few days, a couple of days. the merger agreement expires as of wednesday. assume it's done and it is done. they've received all the necessary approvals from the us government. that happened later on friday with the new executive order from the president. and this golden share provision, which is interesting and not something we've seen before, certainly not something that i can recall. but again, with all those approvals in us, steel will become a subsidiary of nippon. but it will have unique characteristics related to this golden share. namely, it will have its own board of directors, one director appointed by the us, two more independents that they will have some say on as well, and then a

bunch of commitments. and this is where the executive order comes into play, because it basically says if you don't make good on all of these commitments, nippon, then we, you know, you've signed this new national security agreement and you could be in violation of it. and so what do those mean? well, you know, you can't relocate from pittsburgh. you can't redomicile out of the us. you can't change the name. you can't transfer production. and on from there, the main thing being the $14 billion that they're putting in this is in addition to the 14 billion roughly they're spending to buy the company. so overall, it's a fairly large investment. but the 14 billion is 11 billion between now and 2028, in terms of a lot of upgrades and other 3 billion for a new electric furnace. so this agreement packages all the sort of control mechanisms the government's getting as a result of the golden share. and it's done. and that's why you see the stock up and trading so close to that 55.

not good of course to take you back for cleveland cliffs. i know it was just worth taking a look at the performance of this stock over time, because if you recall, it was cleveland cliffs that started all this off by making essentially a hostile for us steel, forcing it to go into auction mode and getting a higher bid from nippon and cleveland. cliffs has been fighting this all along. it's also been fighting a very nasty. fall in its stock price as well. at this point. it bought stelco in canada, didn't really account for the possibility of tariffs there, and obviously it's not going to succeed in what had been its hope that it somehow would be able to acquire. >> well, it wanted an all-american conglomerate here and not a japanese american takeover. as far as who wins, though, from this, i mean, us steel, nippon steel shares were up in japanese trading. they, you know, coming out happy about the situation. you would think the state of pennsylvania and the us because now it's unlikely that nippon would be able to

close any steel plants. right, with. >> this. golden share. no, they're not they're not going to. >> cut jobs or, you know, all the things that you worry about with the foreign. >> takeover, you would think, again, we always wondered about the relationship between dave mccall, the us steelworkers representative, and lorenzo at cleveland cliffs, who seemed to be so aligned. but ultimately, this would appear to be a very positive step for those same steelworkers. >> and they've been more quiet. >> lately in pennsylvania. and that is why you have, on both sides of the aisle, have seen support for this as well, whether it be the democratic governor of pennsylvania or it's senators who well, fetterman is a dem and then and then the other side. >> what a reversal though, after biden blocked it. right? i mean, they bet on the right the strategy of us steel workers. >> and again, we've been telling you it would close at 55. and it will. another big mover today guys is sarepta. this is a brutal one. the drug company had a second death tied to its disease to its treatment of

muscular dystrophy. elevatus. and this is the second one the time that's happened, the stock down 43%, said it's taking steps to focus on safety. now it's going to temporarily suspend the shipments of this treatment for non-ambulatory patients because that's where this happened. the liver failure. oppenheimer, though, for instance, says that the price target is under review following the second death, and it does raise questions about the guidance and the outlook because this is such a major drug for it. obviously the stock is getting punished. >> it's been years that this was you know, it's a one product company. it's a narrow market but one where there's no real other treatments whatsoever. so it's been this crazy, you know, a lot of hope built up into it periodically and then it drains away. >> unfortunately it does. although i'd be curious about the patient population and whether they're still willing to take the risk because it's a horrible disease. and the idea that there is at least something that can slow the progression is

certainly seen as a positive, but clearly getting getting shellacked today as a result of that death. >> some news in stablecoins. senate is working in abbreviated week, but they are looking to vote on the stablecoin bill tomorrow certainly pulls up 11%. of course, you remember this one priced at 31. first day went into the 80s. now it's i think 150. some went over 100. we had the news of walmart and amazon contemplating. so this has been a swirl of stablecoin news last 4 or 5. >> genius bill obviously is a key. and circle has really done everything to sort of have its business be the one that would benefit from compliance with so many of the provisions. sure. >> i mean, visa mastercard shares were down way more than the market on friday, which to me, i mean, you can look back over the, you know, the history of the last ten years and there would be some story about justice department is going to go after processing fees and visa, mastercard, take a big hit. and then people realize they have the entrenched network and nobody can really replicate it, and everything's going to ride on their rails. maybe the stablecoin thing is different,

but it's so far out. and when it comes to circle, i just struggle to understand what the ultimate best case scenario upside is for the business of this invisible layer of. we just take a little bit of a vig off of all of these balances, and as money sloshes in and out. and so, i don't know, it just it's sort of interesting that you got like a 20, $30 billion company built on this. maybe someday you've compared it to some of the like, if i looked at state street and it's a $25 billion, $27 billion market cap, and they have like $50 trillion under custody, and they process all of that and it trades at ten times earnings. right. it's not like people think, wow, this is a fabulous growth business. so obviously that's a real bank circles not a bank. but i just think it's fascinating that people are willing to sort of, you know, kind of bring forward all of the potential on paper to these businesses today. yeah, we do have on a higher level, this chart from david kostin over at goldman today, looking at household enthusiasm for u.s.

equities, whether it's they call it the tina phenomenon, remains in some element of the households mentality right now. this is a chart of sort of share which households just keep adding to the share of us equity ownership. yes. so this is based on the fed data mostly it's quarterly. and i think most of that increase in equity allocation is equity markets going up. so yes there's a flow effect there's no doubt about it. but i even see it be of a weekly updates their own client data. and they've hated bonds for years and they have not been penalized for that. right. i mean yeah obviously now you get some carry. you got 4 or 5% or more. but it's very interesting that there's this pretty tenacious willingness to absorb equity risk right now. and, you know, maybe 2022 just wasn't scary enough. you know, we went down 25% for a few minutes and then it was over eight months. and you've recovered it without too much damage long term. but it is kind of fascinating. i do think it does work against the

idea, though, that there's all this money on the sidelines that's about to be mobilized. just because the pile of money is big, it's not big relative to how much stock people already own. >> some of the big winners here in the early action are tied to china. wynn resorts is up. mgm tapestry, estee lauder. so the consumer names the casinos that tied to the china story. there was some data overnight in china. retail sales came in better than expected, up 6.4%. the consensus was 4.9%. so maybe some evidence that some of the stimulus measures they've been trying to put in place are working. another point on their data unemployment rate 5%, which was lower than consensus at 5.1. and industrial production came in around in line at 5.8%. >> if you look at what happened friday, though, anything related to travel, cross border, anything really got clocked because people just had that first reflex on the. >> carl you mentioned amazon and roku earlier, it is worth coming back to because roku stock to your point, is up almost 10% on what it's kind of a new partnership in which the two are

going to pool their addressable audiences via, i guess, the amazon demand side platform that sells ads. and, you know, so if you're a marketer, it's going to kind of give you a one stop shop that didn't previously exist. you're not seeing an impact on amazon shares, but roku again, up some 10% on this news given now the traffic that they get will conceivably be better monetized, i guess is the expectation there. so i did want to follow up on on your comments earlier. and also guys, you know, keeping an eye on shares of warner bros. discovery and up and down week last week. it was one week ago. of course, the announcement came again. one we've been telling you to expect they were splitting the company up initially very positive in the market, but it ended down on the day. kind of recovered some ground as last week went along. the news this morning is they have gotten the necessary consents from their bondholders to move forward with this. so there had been a risk perhaps, or a concern certainly, that bondholders could mount some

sort of opposition to movements in the capital structure, to allowing them to pursue the transaction, not an issue that's over and done with. and now the question will simply be, what does the tender look like that they're undertaking? how much debt are they actually going to buy back at a discount? many analysts out there say they may be be able to reduce their overall debt load by as much as 3 billion, from some 34 billion, down from there. that said, the 17.5 billion bridge that they're taking on from jp morgan to fund that tender, they're going to have to replace with long term financing that is going to be more expensive. but overall their interest costs will come down. their overall debt load will come down. still a lot of questions to be answered here in terms of we know it's going to most of the debt is going to be on the on the network side. but but the operating networks but but that said we don't know the exact numbers at this point. >> i mean, it's interesting how you haven't heard more about debt buybacks, you know, given what's gone on with interest

rates. right. because the face value of all the debt that was issued under 0% interest rates is much lower. in theory, there's an arb for companies to do, but maybe they feel like it's just for most of them, not necessarily worth the. >> it may not be worth the trouble. i mean, when you have a debt load like these guys do, it certainly can be, certainly as they move into a transaction like this. >> if rating agency issues you have to massage. yeah. >> this will give them more flexibility as well in terms of tailoring the duration of their capital structure. once they get all this done, that could be beneficial as well for them as they decide what they're going to buy more of back end, for example, as well. >> and palantir is up another 5.2% at the top of the s&p on seemingly no news. but obviously, you know, we're seeing the sort of future of modern warfare a little bit. >> which is interesting because a lot of the defense names are giving back their friday games. >> lockheed i saw was was lower, as israel claims full aerial control over tehran. thank you mike. mike santoli we'll see you later. before we head to break it's time for the bond report. let's check out how treasuries are faring this morning. yields

continue to be a little bit firmer here with bond selling off. it's a continuation of what we saw on friday. we get an auction later $13 billion of 20 year bonds which has been a little bit trickier to digest lately than the 30 and ten year auctions went really well last week ten year yield 4.4%. no big economic data. we get retail sales tomorrow and the fed meeting on wednesday. we'll be right back. >> the bond report is brought to you by pimco, a global leader in you by pimco, a global leader in active fixed income. every 15 seconds, someone will hear the words, “you have cancer.” at the american cancer society, we're here to help people through their entire journey.

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today. if i crossed out the word sell and i read it, i would be buying. i mean, it's that positive. it's about robotaxi and it's about the total addressable market. and initially tesla won't do that well. but i've got to tell you i would never sell tesla on this. >> as cramer on the show last week challenging this note from guggenheim on tesla this morning or actually last week, which did explore the potential risks with the robotaxi push, which we're getting closer to that june 22nd date. joining us this morning is the analyst behind the sell call, ron yevsikov from guggenheim, who joins us here at post nine. it's good to see you, ron. we've been talking more and more about the split between the price and fundamentals on this name. has that been confounding to you? >> yeah, absolutely. i think if you went back to when we downgraded the stock to sell, if you had told me 2025 earnings estimates would go to under $2. where to? $1.40 for the year from $10. when we downgraded it, i would have done it again. i think a tremendous amount of the value in the stock is embedded in the robotaxis. our issue with it is there are tremendous

technical hurdles to getting there. the ultimate ultimately, the unlocking the tam is going to be very challenging because the us is not that dense, getting the cost per mile low enough that it will displace car ownership is going to be challenging. and we think the stock is embedding something like 10% of all miles traveled. being on the robotaxi network sometime between 2035 and 2040. >> but when you're talking about the tam, it doesn't sound like you'd be that much more enthused about waymo or any other player in the space. >> yeah, we don't formally cover waymo. i think i think what we see is the near-term opportunity for robotaxis, near-term being five years plus is primarily going to be either supplementing or displacing ridesharing. and that is that is that is a big question among investors. is, is this going to be going over the top of ride hailing, or is this going to be something that ride hailing uses to augment their network? we don't cover the ride hailing industry, but i think that is that is probably a more salient investor debate right now. >> well, what are the technical problems that you believe they haven't been able to surmount?

>> yeah, i mean, i think if you look at the fsd data and it is pretty limited, tesla does keep it pretty close to the vest. but if you look at the fsd data online, what is widely available, the system does struggle in fog, rain, direct sunlight. elon on the last conference call did say that those are not technical problems he is concerned about. but the data we have available to us, and all of the kind of experts we have talked to about camera only autonomous systems, do suggest that it will struggle in certain weather conditions, and it's tough to have a robotaxi network if it doesn't work, rain or shine. because ultimately demand is highest when weather is the worst. >> and no signs that they've been able to surmount those, at least in europe, based on the data that you've been able to see. obviously, you know, he clearly says we're better than lidar and radar in terms of what waymo has and our neural network ultimately. and the data that we have is going to enable us to be able to surmount any of these issues in the near term. >> yeah. no, it's a good question. nothing we've seen in the data suggest they have solved this problem, but they are very confident that they

either have or will solve it based on their public messaging. i think where we struggle is if they cannot solve it with camera only, or if it's limited in scope and scale in terms of the times it can operate. ultimately, this this tam doesn't get unlocked, right? or it gets solved by another provider. and if they have to solve it a different way than they've promised, what they've promised historically is this generalized approach to autonomy. that's not what we're getting in austin when this launches in a couple of weeks. the approach that's launching in austin is a different version of fsd. elon has said that publicly. it has four times as many parameters. then you have questions of if the current fleet of teslas is powerful enough to computer. the inference compute on the vehicles is powerful enough to run fsd. and if the fleet doesn't benefit tesla's robotaxi argument, then we think this is something like a half $1 trillion of spend over the next 15 years to actually unlock even just 10% of this tam. and this is a cash burning business today. we think this year. >> you do think it's going to burn, especially with credits potentially going away as well. i think that's got to be another headwind for them, right? yeah.

>> yeah, exactly. the credits will certainly will certainly hurt the business. tesla's not alone in that. i think all electric vehicles it will be a headwind for their losing share in china. you're seeing tremendous amount of competition from xiaomi byd and others. and we think the business is basically ex-growth in china. i think it's a debate if it's x growth in the us and europe, but we've seen the model y, the refresh hasn't unlocked new demand, the model three refresh hasn't unlocked new demand. so we're very confident it's cash burning this year. i think the question is, is it cash burning next year? and that is before they have to lean in to spend on this robotaxi network. it's really heroic. what investors have to underwrite here is a business that generates no free cash flow valued at $1 trillion. and while we get painted as bears and i think that's fair, we have a sell rating on the stock. ultimately, i don't think valuing this as a $450 billion business that's not generating any cash flow feels that bearish to us in terms of valuation lens. >> right. >> rob i appreciate it. we're up against the clock. good to see you. rod yevsikov guggenheim. we're back after this.

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>> good monday morning. welcome to squawk on the street i'm sara eisen with carl quintanilla and david faber live as always from post nine of the new york stock exchange. we're starting the week strong again here. the s&p 500 now at the highs of the morning. and every sector is higher except for energy which may be a little counterintuitive, but crude oil giving back a lot of the gains that we saw on friday despite escalation in terms of u.s. or, excuse me, iran-israel conflict. as for the best performing sector today, that would be technology now up 1.5%. financials are coming back strong communication services to as far as the big tech winners seeing a lot of gains amd palantir is at the top of the list today. some of the other chip stocks also working well. treasuries are selling off higher yields today. get an auction of 20 year later in the day. the ten year yield. actually we've just reversed 4.4%. so a little bit of a bid

just in the last few moments or so. today, rockefeller's ruchir sharma on how global markets are reacting to israel iran as g7 leaders gather in canada this morning, where the middle east is sure to be front and center. plus, shares of biotech company sarepta therapeutics losing half their value almost this morning. we're going to tell you what's driving this decline. first up though guys big event of the week is going to be the fed meeting. we do have a holiday shortened week thursday. the market is closed and we get some important economic data before then. tomorrow we'll get retail sales also import prices which are in focus because of the tariffs. but the biggie is the fed decision. and then later on friday philly fed and leading indicators. we got a an empire fed new york regional manufacturing number. that was pretty ugly this morning. but that's a very volatile series. and the outlook wasn't as bad. so what about the fed because nobody expects any change in policy this week. but everyone wants to know how fed chair powell is going to frame the recent data and what the dots are going to look like. this is one of those exciting fed meetings where we get the dot

plot, which is the estimates for where the individual members of the fed think interest rates are going. we haven't had one since march, and a lot has changed since march, including tariffs and weaker inflation. so here are the charts the fed's going to be looking at and reflecting on cpi and ppi. so this is just straight up consumer prices. and what we have seen is they've very much softened. remember 2022. that was the peak when we were looking at like 9% or so price prices. and that was a very inflationary period. we've come down. we're still elevated above the 2% level. but again, there's been a lot of progress. so my biggest question, david, is how has fed chair powell going to frame the progress in light of the risks of higher inflation going forward because of tariffs and now maybe oil prices. i mean, look at oil prices. they've come up a little bit on the result of these geopolitical tensions. but this is a three year chart. they're still down pretty sharply over the past three years. i was just looking at a price of brant from october 2023. that was when hamas first attacked israel. we

were we were looking at 85, 85 crude oil north of that. you know, we're in the low 70s right now. so is this really a source of concern for the fed when it comes to inflationary pressure? right. that's another big question. >> yeah. well but isn't the really big question. where's the where's the pressure from tariffs. and is it going to show up and when. and obviously i know those who expect it still say it will be one time in nature. but i mean here we are. it's middle of june. yes. we haven't seen signs yet. >> we haven't seen signs in the april data or the may data. both have come in lower than consensus, showing that it hasn't really been pushed on. and then you wonder about the other side of the fed's mandate, right. they want to keep prices in check and also keep job growth relatively strong. so here's what we what they're going to be looking at in terms of the last few months of job growth. it's slowed down from last year, but it's still pretty healthy. we're still adding, you know, 100. what was the last report? 130 or so thousand jobs per month? there was a lot of

talk about business uncertainty, consumer uncertainty. >> revisions, though we should point out. so it's possible that will also get. sure. yeah. >> but so far you know unemployment rate is what 4.2% jobless claims have not gone above 300,000 per week. in terms of layoffs. there's an argument that this fed can make for wait and see, which is what the market expects them to do. i think the bigger question is what do the back half of the year estimates and dots look like? in march? the median estimate was for two cuts this year. will they change it to one because they don't know if tariffs are going to be inflationary. will they keep it at two. will they take them both away and make it none? i think those are some of the questions. and then how powell talks about those, those dots, those dots which are actually very confusing and mean nothing. >> ultimately we'll see. goldman's out today saying that the median fed dot they think will be unchanged. but we will. >> do two cuts this year. >> we will find out on on wednesday. meantime g7 leaders gathering in canada today some key meetings about to get underway. for that we'll get back to megan costello who is

live from alberta with the latest. morning, megan. >> hey. >> good morning again guys from alberta. it is starting to warm up here as the sun gets a little bit higher in the sky. leaders have been arriving about 20 miles from here in kananaskis, canada all day yesterday as well as today. it's the g7 leaders and some other invited officials from the eu, from australia, from brazil, the united nations as well. all of them going to be here for this two day summit. and as for trump's schedule today, you mentioned key meetings. he's about to sit down in the next hour with canadian prime minister mark carney. you can kind of think of that meeting as a little bit of a upside if they do manage to strike a trade deal, but a lot of downside if things go south between those two leaders. so all eyes on that. we do expect to see them on camera. we'll bring you that when we have it. right after that we have the g7 welcome. and then we have a couple of working sessions on the economic growth globally, as well as the global economic outlook as well. the backdrop to all of those conversations, guys, and for much of this week is going to be trade and tariffs. with trump's trade war really sort of being the elephant in the room here. all

of these leaders trying to strike a deal, all of them wanting to confront the president in sort of a measured way on those tariffs and try to avoid that july 9th deadline when tariffs are set to kick back into effect. and when you think about that, i want to flag one piece of news we do have out of canada so far is that canadian officials confirmed for me last night. there will be no joint communiqué coming out of this summit this week. that is one of the few concrete deliverables we tend to get from g7. all of the leaders sort of signing on in a show of unity to some shared goals, economic goals usually, as well as foreign policy, social commitments as well, in order to avoid disagreements. there is not going to be any statement. canada as the host country, is not pushing for that at all. we might see individual leaders statements, but that's it. and so when you think about that, everyone that i talk to here, when i talked to about what to expect this week, mentions this photo we can pull up for you from 2018. this is the last time that canada hosted the g7 seven years ago, and it became sort of an iconic symbol of that summit when trade and tariffs once again were the center of

conversations. it's all the leaders on one side of a table. the president, with his arms crossed pretty defiantly on the other. and you guys will remember that was the meeting when the president did sign on to the joint statement. all the leaders had signed on to it. after he left, then prime minister justin trudeau had some harsh words about the tariffs, and president trump then pulled out of the joint statement to much drama after that. so there's a lot of, you know, it's underscoring that without any joint statement this week, guys, it's underscoring just how fractured the g7 is right now. but a lot of questions about whether we'll see a dynamic similar to that 2018 photo once again, or whether everyone's going to be on their best behavior, we might be might see more signs of unity, guys. >> megan, speaking of canada specifically, and also mexico, because claudia sheinbaum, the leader of mexico, is there as well, even though they're not a part of the g7, the us, mexico, canada agreement, what is it gets reviewed in 2026? i know there's been some reporting not from you, but saying the administration perhaps is not as

enthusiastic about moving down the road there because of that. so, you know, i'm kind of curious, where does that then stand in terms of the likelihood of getting something with canada, for example, or canada and mexico together? >> yeah, i think that's a great point. yes, it's summer of 2026 that the deal was always set to be renewed and reviewed. they built that into the usmca when they signed it. the president, the white house has been considering maybe just using this current dispute between canada and mexico as a way of reopening that early. i think all three countries are open to that, if that's how they get a deal, by simply starting that review process early, they think that that's okay. one thing that's changed, though, david, is that when the president increased those steel and aluminum tariffs from 25% to 50% just a couple of weeks ago, canada is the largest supplier to the us of both steel and aluminum. mexico's high on the list as well. so that move is sort of a direct shot at those two countries. while we had seemed to be at some sort of an impasse with canada and mexico after they exempted usmca goods from most of trump's tariffs,

that increase sort of kicked things off again. now, both canadian and mexican leaders have been talking about coming up with lists of goods to hit with retaliation. so that's sort of the backdrop to these meetings this week. there is going to be a bilateral with mark carney, as i said, but also with claudia sheinbaum tomorrow, the president of mexico. so maybe they agree to put things off till 2026. maybe they agree to some sort of a truce of a truce. until then, that's what we have to see. but at the moment it looks like all of them want do want to reach something before that 2026 deadline. >> meantime, megan, we got stocks at session highs. oil briefly got below 70. the vix is lower. gold is lower. we got this journal piece crossing a few moments ago a battered iran signals it wants to de-escalate hostilities with israel and negotiate they say arab officials tehran told arab officials they'd be open to going back to the table. as long as the u.s. doesn't join the talks, anything we can add to it. >> that's going to be the biggest topic of conversation this week. and i think that that

was obviously something unexpected of how much that would be center stage for this talks. the latest that we have from the president was last night when he said, and he's continued to say this throughout the weekend, it's time for a deal. he hopes that there is a deal, but sometimes they have to fight it out. it's interesting that tehran said in that piece, according to the journal, that they would be open to negotiations as long as the u.s. doesn't actively join in the attacks, because that's been the biggest question as the u.s. and its rhetoric has been standing by israel. the question has been just how far it might be willing to go to facilitate israel as it continues these attacks. so now iran kind of laying down that red line. it seems like when i saw that story crossed just before coming on with you guys, to me, based on everything we've heard from the us side, it seems like they would be open to that because they have overall mostly been pushing for a negotiated solution, wanting to get back, wanting to get everybody back to the table. and the president for months now has said that was his preferred path. even after these attacks began. he kept saying that. so i would imagine that's something the us is open to. we haven't seen them respond. we

haven't heard them even confirm that reporting just yet. but we might hear that from the president when we see him on camera later today. >> but would the israelis be on board with that as well? they are now able to fly freely over iran, and iran hasn't exactly proved a good faith negotiating partner in the past over this issue. thank you. megan, we'll look for headlines for you and that bilateral in the next in the next hour. megan cassella. >> well, israel has struck iranian oil storage facilities and parts of iran's biggest natural gas field as well this weekend. but that's not having an impact on the price of oil. perhaps something of a surprise. let's get to brian sullivan, of course, who covers all of these markets and so much more for us. brian, what's your take in terms of the moves here? we've seen in the commodity itself, given all the news. >> the take guys is that. and by the way, let's hope that what megan was talking about some kind of negotiated peace. let's all hope that occurs. and i think the market is reflecting the optimism right now that that

indeed happens. i think the big part of this story is not that oil moved last week. it's that oil is not moving right now. so here kind of the quick headlines as we know them. oil is down. natural gas is up. opec not yet responding with more oil. and by the way they may not. side note iran is actually the rotating president of opec this year. and the critical aspect david and karl and sarah the strait of hormuz is still busy. that is critical to watch. and of course us production is at a record high right under 13.5 million barrels a day. let's quickly dig into more. all right, so as we know over the weekend, israel hitting four energy targets in iran. but here's the key. those targets were almost entirely focused on domestic energy production. it's basically meant to drive up gasoline prices in iran. one strike was on iran's south pars gas field. that's critical to watch biggest natural gas field in the world, largely offshore, and actually shared on the other side of the persian gulf by qatar. israel, for its part, shutting down two

natural gas production areas. a little risky in the long term. israel needs natural gas to make electricity. 70% of its electricity comes from natural gas power, so israel wants to get those turn back on as soon as it can. but by shutting them off, it's sending the price of natural gas a little bit higher. so why is oil down? well, as i noted, oil is down because there is no disruption to the strait of hormuz, at least not yet. this is the critical aspect to watch. cannot express that enough. if we start to see mines laid down, or missiles flying, or ship traffic impacted at all in the straits, then oil is likely going to pop by a lot. but it will not until that happens. and let's hope it doesn't. so what about opec? well opec respond guys the more oil. keep in mind eight countries in opec already previously agreeing to add 411,000 more barrels per day to the market. something else to watch, and this is interesting, seems to be a very different feeling about the current

situation between opec and the international energy agency. the iea look at this note opec put out over the weekend. they said opec confirms no developments in supply or demand that warrant unnecessary changes. in other words, guys opec doesn't see a reason to add more oil to the market right now. but the head of the iea gave a slightly different message to the market, writing this quote, the iea is actively monitoring the impact on oil markets from the iran israel situation. markets are well supplied today, but we are ready to act if needed. the iea security system, kind of their strategic petroleum reserve has over 1.2 billion barrels of emergency stocks and have proved vital to safeguarding the world economy. opec guys didn't like that tweet and added this to their communique, saying, quote, today's statement by the iea executive director regarding current market conditions and the potential use of emergency stocks raises false alarms and projects a sense of fear through talking about using emergency stocks. so a little more back

and forth between the two organizations, they rarely see eye to eye these days. this may be taking it up a notch. and again, i can't highlight enough guys. the rotating president of opec is iran. it's a guy named mohsen nejad. he is the president for this year and the head of saudi aramco recently saying that oil can help with diplomacy. maybe we're going to find out very rare once every five year opec seminar happening three weeks from now in austria that maybe in the g7 two could be some kind of scene of real diplomacy. >> a lot of information there, brian, thank you very much. running through all the all the headlines we need to know on oil which brant now down 3.2% wti same price just above $70 a barrel. we are 30 minutes here into the trading session. here are three big movers. we're watching president trump approving an offer from japan's nippon steel to take over u.s. steel $14.9 billion bid, including, quote, the golden share for the white house, which would give the u.s. government a permanent stake in the company, along with certain board and

veto powers. also watching shares of gucci owner kering gaining today on reports that they picked the outgoing ceo of renault as their new ceo. he oversaw renault's shift toward evs and the brand revamp, creating some optimism in that stock which has been under pressure there. that's the owner of gucci and then biotech player insight, a top gainer in the s&p. this morning after promising data out of the company's experimental blood disorder treatment. stiefel upgrading the stock to buy from. hold on the news, calling the results quote the best case scenario, up 3.6%. here's our roadmap for you. for the rest of the hour, rockefeller's ruchir sharma will be with us to talk global markets as the world monitors developments in the middle east. >> well, shares of meta on the move this morning, they're up about 3%. the company announcing a big change for one of its key apps. we'll give you the details ahead. >> and we'll head to the paris air show for an interview with the ceo of engine maintenance company standard aero. as the boeing crash does remain top of mind for the industry now, squawk on the street continues

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chairman for his outlook. ruchir it's great to have you back. i wonder what you make of this so strong and steady resilience after that brief, mild decline on friday. >> well, i think the markets over time have learned to brush aside geopolitical tensions. in fact, we've done some research on this. and what it shows is this is that if you look at since 1950, the 25 most significant geopolitical shocks around the world, the s&p 500 tends to decline by about 4% within 15 days, and within a month or so tends to recover that 4% loss completely. that's because in nine out of ten times, the geopolitical tension tends to be contained and doesn't spread. now the markets have become even wiser over time that these dips on geopolitical tension have gotten shallower and shallower. so i think that's what we're seeing here, which is that the markets think that. yeah, you know, this appears like a scary moment. but in its collective mind, it looks back

at history, says nine out of ten times the geopolitical tensions tend to be contained and so carries on. now there's obviously a risk that there'll always be that one out of ten times. and that's the fear that lives in most individuals minds. but as i said, that history is better remembered than it's lived, and that nine out of ten times these things just tend to fade. and like in the past two, we think that this is a very uncertain time. but in the past, there's always been uncertainty that tends to get resolved the right way. >> meantime, i wonder what you make of what some call a gradually slowing economy, one that may continue to slow into the back half. do you think that creates a backdrop where you can sort of defend against geopolitical risks that pop up, or trade disputes that pop up? >> yeah, i think that there's no doubt that the us market's resilience in the face of all that's happened this year is quite stark and quite surprising to many people. but i think that the biggest story this year has

been just how well international markets have been doing. and the dollar has been a very big factor out there. so i think that what we're seeing this year is that flows have begun to the international markets again after a long drought. that's the real story in the us. the big story remains just how smart the retail investor has been. you know, we always tend to sort of look at the retail investor as dumb money as the laggards, but something which i've also now come to appreciate is that the retail guys have really ended up being smarter than the hedge funds, because they are the ones who bought in size and in dip when this market sort of went down a lot. and it's the hedge funds who are now sort of nibbling in every time that there's a dip, because they are lagging behind the benchmarks so significantly. but the big story here is that the american economy so far has been relatively resilient, more resilient than most of us would have expected. >> so the outperformance of particularly europe, like a stock market like the german

dax, i mean, the biggest reason i hear for it when you talk to investors is it's just underperformed for so long, and it was due for catch up and that everyone was too negative. is there any fundamental reason to continue to shift money into europe from the united states? >> well, i think that, you know, this is happening across the world and it's not just europe. i mean, if you look at what's happened to emerging markets as well, they're also up double digits this year in dollar terms. so, yeah, in many ways this is a catch up trade. you know where the us market had run away far too much. it come to dominate too much. but also there has been some fundamental change. you spoke about germany i think a story that has faded now, but was a big story a couple of months ago is that they are carrying out more economic reforms. they are putting more stimulus to work, they are spending more on defense. and similarly, many other countries around the world have been reacting to the tariffs and other headwinds that are coming their way by stimulating or by cutting interest rates and also by enacting more economic reforms.

so there is a fundamental story, and it's not just about europe. stocks and latin america, in fact, have been the best performing stocks in the world this year. that region has done really well from brazil to other places, because you have more politically friendly leaders coming to power or leading in the polls as it has big elections this year. so this is a universal pattern. the most important driver of this has been the dollar, and the fact that too much capital had become concentrated in the us. and that is finally beginning to diversify after 15 years of heading one way, which is all into the us. >> all right. >> next time we'll talk about your recent piece regarding chinese consumption. really interesting picture going on over there. but for now, thanks for your time. good to see you, ruchir sharma. >> still to come, shares of sarepta therapeutics losing about half their value this morning. what investors need to know in just two, plus the latest developments between israel and iran, as a report says iran is signaling it wants

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>> we've got a number of downgrades as you might expect of sarepta today, this after the death of a second patient who received the company's gene therapy to treat duchenne muscular dystrophy. angelica peebles is here. she has more on the story for us. angelica. >> good morning david. that's right. sarepta is saying a 15 year old who received the company's gene therapy, it's called a levite is dying from liver failure. and this is the second instance in just a matter of months. the other patient was a 16 year old boy. and both of these patients who received the treatment for duchenne, that's a genetic disease that primarily affects boys, and it causes them to gradually lose muscle function. and both of the teens who died had progressed to the point where they weren't able to walk. and that's an important distinction, because originally the fda only approved levetus for four and five year olds who could still walk. and then the agency expanded the label to nearly all duchenne patients last year. and that was a controversial decision because there wasn't as much evidence the treatment would work in older, more advanced patients. now, sarepta has halted all shipments of the therapy for

more advanced patients while it explores a new safety regimen. and ceo doug ingram on a call with analysts this morning saying that sarepta is suspending its 2025 guidance and will update its full year revenue outlook when it announces second quarter results. analysts are projecting $1.5 billion in sales for the year. that's according to factset. but those projections are now, of course, in serious doubt because it's not clear when or even if, the treatment for more advanced patients will resume. it's also possible that safety concerns will cause people who are still eligible to reconsider their decision. and that, of course, is no stranger to the controversy. but those concerns and those doubts are growing even louder today. look at that stock down about 48% just today. and over the last year, about 85%, guys. >> yeah. although duchenne is a horrible disease as well. we should i mean, i don't know what the patient population, what risk they're willing to undertake, you know, if they think it's going to be effective in slowing the onset of the disease itself. >> and that was the big controversy. i remember watching

these advisory committees when the fda was deciding whether or not to approve this gene therapy at all, and they were really passionate stories from parents, particularly moms, who talked about just watching their child basically disintegrate before their eyes, no longer able to walk and jump and do the things that normal kids can do. and just speaking to the longing that they had for wanting something, if anything, to treat their children. and of course, that's one of the issues that the fda is often faced with, right? balancing the need for something for people who really have nothing with the safety and the efficacy concerns. >> angelic a tough story. i appreciate that very much. angelica peebles this morning on sarepta. let's get a news update this morning with courtney reagan. morning, courtney. >> hi. good morning carl. well, after what authorities called the largest manhunt in state history, the man accused of killing a minnesota lawmaker and her husband and injuring another lawmaker and his wife is in custody. police say they arrested the 57 year-old last night, armed and crawling in a field near his home. authorities

say he left behind a notebook with a hit list of other lawmakers, as well as people who have been vocal supporters of abortion rights. he is due to make his first court appearance this afternoon. well, juror and the sean diddy combs sex trafficking trial dismissed today about concerns over his candor after allegedly giving conflicting answers about whether he lived in new york or new jersey. he was replaced by an alternate. combs faces five criminal counts. he has consistently denied the allegations against him. and following a series of close calls in recent years, southwest airlines is adding a new cockpit alert system to help pilots avoid dangerous situations. the wall street journal reports the system delivers verbal warnings and text alarms. if a pilot is about to use the wrong one way, or take off from or land on a taxiway. sarah, back over to you. >> okay, courtney. thank you. coming up, the lead negotiator for the nuclear agreement with iran under the obama administration and former deputy secretary of state wendy sherman is going to join us. we'll ask her about some of these new

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and make official. start your will at trust and will and make it count. >> welcome back. the wall street journal reporting moments ago that iran has signaled it wants to de-escalate hostilities with israel and restart talks with the u.s. and then reuters just reporting that iran has asked president trump to press israel to agree to a cease fire and would offer flexibility in nuclear negotiations in return. joining us now is wendy sherman, former deputy secretary of state. wendy also led the u.s. negotiating team from 2011 to 2015 on an agreement that limited iran's nuclear activity. wendy, it's great to have you on the show. first of all, i mean, how much credence do you put in this reporting? does it sound realistic that iran would be trying to push the u.s. to come to the table at this point? >> well, i would not be surprised if steve witkoff and

foreign minister araqchi haven't been in touch with each other. that would not surprise me. and the wall street journal article seems to imply that through intermediaries, particularly to arab states, they've urged a ceasefire. now they've said they would offer more flexibility. but i doubt seriously that iran is ready to give up any enrichment capacity whatsoever. but i certainly prefer diplomacy over the situation that we have now, which is not in anyone's long term interest. we all don't want iran to have a nuclear weapon. the question is, how do you get there? and i think if we stay where we are right now, this fight between israel and iran and israel certainly has a right to defend itself could go on for some time. and that's not good for stability. that's not good for oil prices. that's not good for economic stability in the world. >> so do you see it as realistic, though, that iran

would agree to something that israel would agree to when it comes to nuclear disarmament? >> well, i think that prime minister netanyahu, with full support from opposition parties in israel, believes that he is on to something now to try to force iran to agree to dismantle its entire program. i think that there's no question that what israel is doing is quite punishing to iran, not only the decapitation of its military leadership, but also doing some degrading of the nuclear facilities. though the most extensive facility is underground at fordo, and israel cannot take it out without the united states help. we have the bomb that will do that. we have the aircraft that can deliver it. israel does not. so israel is going to continue to push, as are some hardliners in our own country, for the united states to get engaged. the president is

trying to not make that happen. i agree with him on that. he'd like to get back to negotiations. in my view, that is far preferable, but i'm not sure we'll see the end to this anytime soon. >> well, yeah. if israel is demanding the cessation of all uranium enrichment by iran, do you think that that is a goal that could be reached? >> i think under the current circumstances, there's certainly pressure on iran, but enrichment. iran believes, is its right under the nuclear nonproliferation treaty, other countries, including some european countries, would agree with that. the united states does not believe that it is a right. neither democratic presidents or republican presidents have believed that what president obama did in the joint comprehensive plan of action, which i helped to negotiate, said that iran might be able to maintain some very,

very low level enrichment under very extensive verification and monitoring by the international atomic energy agency. that deal was working until, of course, in 2018, when president trump decided to exit. now we are where we are. >> do you think, wendy, we're in a moment where those who have historically favored diplomacy may be a more dovish path now see the opportunity being so close that they would graduate to a to arguing that maybe we supply some of those assets that would maybe take this threat out for good. >> i think that certainly there's this wish we all have for iran not to have this capacity at all. that said, if the united states gets engaged in taking out fordo, helping to get to the underground of natanz, which israel has only been able to degrade, the on

ground part of natanz, but not the underground enrichment capability. without the us, it's not going to be possible. and if we get engaged, then i think diplomacy is off the table for quite some time. i think that you will see a lot of instability in the middle east. you may see iran then take actions like trying to close the strait of hormuz. they have cyber capabilities. they have landmine capabilities. they have terrorism capabilities. so i think it's a very dangerous step to take. president trump, i agree with him in this, is trying to be cautious about taking that step. but i certainly understand the impulse to think that one could get rid of this capability once and for all. the risks, however, are quite great. i also find myself agreeing with president trump if it is true that he told israel not to take out the supreme leader when israel had a chance

to do that, because i think that all muslim nations would have had to rise up against us, assassinate being part of an assassination of a leader of a sovereign country. >> i just the trust factor seems sort of hard to understand when it comes to diplomacy in a country like iran, when even the un atomic negotiators said that there's no peaceful use for what they have. >> indeed, sarah, i understand this. and rafael grossi, the head of the international atomic energy agency, just laid out where things are. they are quite concerned, as am i. this isn't about trust. this is always about verification. this is always about monitoring. when we negotiated the iran deal back in 2015, we had the most extensive monitoring and verification people on the ground. electronic means. you know, it's

interesting. the president is now at the g7 in canada. this was supposed to be a discussion in terms of national security issues about ukraine. zelensky and russia, head of nato, was were invited to it. i think, however, the top issue is going to be israel and iran. >> wendy, we appreciate your your expertise here and your perspective. thank you for the time. >> sure. >> take care. see what happens at g7. wendy sherman, former deputy secretary of state. >> still ahead this morning. meta tapping a new source of revenue company announcing a major change for whatsapp. and the street seems to like it. we'll get those details straight ahead later on. don't miss our interview with omega family office chair and ceo lee cooperman. we'll get his latest read on the market some of his top picks right now. so stay with us. >> as a business owner, i've got a lot on my plate. that's why i use ziprecruiter to hire. the plan was to hire two people, but the candidate quality was so

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website below. >> 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. >> never miss a moment. >> the reconciliation bill will not only give certainty to the markets about the extension of the current tax regime that exists, but it also adds new stimulus. >> i would expect inflation on a year over year basis this year to shoot up to at least 3% or slightly over because of the tariffs. >> people's anticipation. >> is like things are going to get worse, but they haven't gotten worse. >> welcome back. i wanted to note that shares of amd having a very strong session. you can see that's an unusual move for that.

stock up almost 9%. no news to speak of. there was an upgrade from piper. i am hearing some talk though that involves perhaps a gpu win for amd from aws. again, that's a rumor, but i share it because in fact, when we have situations like this in which a stock is moving sharply and we've at least are aware of what may be moving it, we want you to know that. that said, have not been able to confirm or try to or have reached out to the company's ceo, but have not gotten any confirmation of, in fact, whether that is the case. but that does appear to be why amd shares far outpacing the market and the group of which it is a part as well up as you see, some 8.7%. >> meanwhile, the paris air show, the world's largest aerospace industry exhibition event, takes place this week. our phil lebeau joins us this morning from paris with the ceo of engine maintenance company standard aero. morning, phil. >> good morning. carl. russ ford, ceo of standard aero. i think some people are watching

this right now and they say, i know a little bit about standard aero, but i don't know a whole lot. explain to people why that engine maintenance ecosystem, if you will, has become so robust. okay. >> good. thanks, phil. standard aero actually has been in business since the dawn of powered aviation 114 years. so we've been through the entire development of the whole aerospace ecosystem. that ecosystem has three main pieces and has always had those three main pieces. the first are the oems, the original equipment manufacturers that design and develop new engines or new airplanes. well, the other end of the spectrum, you have the operators, typically airlines in the commercial world, and then the bridge in between that are the companies that provide maintenance for the engines or the aircraft. and that's what standard aero does. >> and part of your success and why your stock reflects the success over the last year relative to the rest of the market. you're somewhat insulated. the planes may not

have as many passengers, they may not make as many flights, but the cycles are generally there and they do need to do that. engine maintenance, right? >> that is correct. there are several elements that impact the volatility of different pieces of the market. and if you think about the aerospace and aerospace ecosystem on the front end of the business, you have airlines that interface with the direct flying public. and every day people make choices about buying a ticket or canceling a ticket or changing flights. so you have a lot of volatility. and airlines are structured and designed to be able to handle that. but regardless of the airplane is 90% full or 70% full if the flight happens, the maintenance on the engine is required because the engine is based upon cycles of operation, not the number of passengers. >> a big part of your business is component remanufacturing or servicing a component. instead of going out and buying a new one, you guys will say to the people, look, we'll make it up

the standards and it'll cost you a lot less. has it been tougher with the supply chain the way it's been the last couple of years, or is that something that you've been able to say we can work around that. >> yeah, that's that's been a purposeful investment on standard aero's part is recognizing that the pandemic brought some additional strain on the supply chain. so what we decided to do was not sit on our hands and do nothing. we decided to provide a detour around some of the logjams, and that detour was to invest and grow our component repair business so that we can take components that can be returned to factory specifications, and then return to engine use a lot faster than in a constrained environment. >> real quick, because you have a peek into the business of your customers, the airlines. how do you feel about what we're seeing, at least domestically in the us over the next year? how do you think things will progress? >> yeah, well, look, the long term forecast is that passenger flight is continuing to grow. and as it has for the last 40

years, and it has outpacing the growth of the ability to provide new airplanes. so what that means is we need all of the airplanes we have today, plus new ones to satisfy the growth in passenger flight demand. and as as a result of that, you're going to see airplanes and engines flying a little bit longer than they had planned, and they're going to need more maintenance. and so having the ability to continue to repair engines, keep them in service longer, that is integral to being able to satisfy the demand for the public. >> russ ford, ceo of standard aero guys, they're going to send it back to you here from le bourget, france, where it's been an interesting and active first day of the paris air show. >> all right. keep it coming. thank you. phil. phil lebeau, meta announcing a big change for whatsapp. and the street seems to like it. we'll explain what they're doing next and then check out another media mover. roku jumping in early trading

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stiff all day. get 20% off using code tv at cisco.com. >> welcome back. take a look at shares of meta. they are higher this morning, after the company announced it was taking a step to bring ads to its whatsapp platform, specifically in the updates tab that will separate the advertisements from personal conversations. now, this move comes 11 years after facebook acquired whatsapp. if you recall, it was a $19 billion deal. then meta also says it will monetize whatsapp channels feature through search ads and subscriptions. and the market does seem to like the possibility of it. >> well, i mean, it's a big business. 1.5 billion people use the updates tab. so that's big. i had raised questions about whether it would lead to privacy concerns, because the whole point of these whatsapp chats, they're encrypted. it will not they will stay encrypted. it will not be sort of in in these chats. it's going to be in the channel and status at pages basically. and they'll, they'll, they'll use limited info like your country or your city, how you interact with the ads, your language, the channels you're following. so from shareholders

perspective, great chance to make money here off the, you know, billion plus people that are using this. >> by the way we keep mentioning meta being the best mag seven of the year. i was just comparing 20% year to date versus microsoft 13 nvidia sort of high single digit. it's been it's been a horse right so far this year on a on a series of news. >> it is absolutely been been a very strong performer and approaching a $1.8 trillion market value as well. also, you know, last week that was an interesting deal. the scale i deal that we did report on a bit, 14.3 billion, 49%. my understanding, by the way, is they take alexander wang, the man who founded scale ai, and they bring him over to meta, where he's going to run. it seems many of their ai efforts. he's obviously a very young gentleman. i think he's still only 28 years of age. some of the questions from his investors in scale ai, though, which actually is reported to have lost a key customer in google. and so if you're an owner there, including he's still a

significant owner of the company he's coming from, but he did get paid out to a certain extent. apparently, meta is letting him vote their shares as well in scale. i, but i don't want to overlook that deal. it was an important one for the company. i mean, 14.3 billion. it's still smaller than the one they did 11 years ago to buy whatsapp for. >> what are they getting besides alexander? is that the whole thing? it's the acqui hire. >> yeah. and the other other people from his team. yeah. i'm not. that's a good question, sarah, i don't know. it doesn't mean there isn't an answer. i just don't have it for you. >> a very expensive. acqui hire leader. yeah, yeah. >> after the break this morning, a wall street legend and omega family office chair and ceo leon cooperman is with us. we'll get his latest thinking on the market. talk about where he's putting some money to work right now. dow's up for 65. close to now. dow's up for 65. close to session highs. ♪ (relaxing music plays) ♪ (♪♪) when a last minute getaway calls... (♪♪) answer it. (♪♪) book last minute deals on thousands of stays with vrbo.

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